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JUDY WOODRUFF'S INSIDE POLITICS

Is it Payback Time for Iraq?; Interview With John Edwards

Aired October 16, 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: Is it payback time for Iraq? Senators face off over who should pick up the tab for reconstruction.

SEN. EDWARD KENNEDY (D), MASSACHUSETTS: We were told Iraq could pay for its own reconstruction. It cannot. Week after week after week after week after week, we were told lie after lie after lie after lie.

ANNOUNCER: Is it payback time for wealthy seniors. A new move toward Medicare means testing renews the explosive debate over the right prescription for reform.

ARNOLD SCHWARZENEGGER (R), CALIF. GOV.-ELECT: There's no greater ally that this Golden State has in Washington than our president, my dear friend, President George W. Bush.

ANNOUNCER: The actor-turned-governor and the governor-turned- president discuss how they can help one another.

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

(END VIDEOTAPE)

CANDY CROWLEY, CNN ANCHOR: Thank you for joining us. Judy is off today.

At this hour, the Senate is heading toward a showdown over funds to rebuild Iraq. At issue, should the U.S. fork over billions with no strings attached, or should some of the money be in the form of a loan that Iraq would have to repay? The White House said again today it strongly opposes the loan option, but how will the Senate vote?

Which is why we have our congressional correspondent Jonathan. How are you, Jonathan? What's going to happen here?

JONATHAN KARL, CNN CONGRESSIONAL CORRESPONDENT: Well, Candy, by the end of the day or tomorrow at the latest, the president will almost certainly have the $87 billion he wants, but he's on the verge -- people up here in the Senate who are counting votes say -- of potentially a significant setback in terms of how that $87 billion will be structured.

The issue here is that between six and ten Republicans are poised to defy the White House on the critical issue of whether or not some of that money for Iraq will be given in a loan instead of an outright grant. The White House has adamantly stated that it cannot be a loan. This must be a grant.

But those Republicans are poised to vote the other way. That vote may happen later today. It could slip until tomorrow.

While all that is going on, we also have a significant number of Democrats who are saying that they will vote against the overall bill, loans or no loans. That includes the House Democratic leader, Nancy Pelosi. She is saying that she'll vote no regardless. Also, two Democratic candidates, John Edwards and John Kerry, are also saying they'll vote no.

And in a very forceful speech this morning, Senator Ted Kennedy said the same thing.

(BEGIN VIDEO CLIP)

KENNEDY: The greatest mistake we can make in Congress as the people's elected representatives is to support and finance a go-it- alone, do-it-because-I-say-so policy that leaves young Americans increasingly at risk in Iraq.

(END VIDEO CLIP)

KARL: But even if the president ultimately loses on that questions of loans, it would seem almost certain he'll win on the overall question and that's where the support of the Republican leadership up here, people like Congressman Tom DeLay.

(BEGIN VIDEO CLIP)

REP. TOM DELAY (R-TX), MAJORITY LEADER: That whole debating tactic of "I support the troops, but," it just isn't going to cut it this time. If you support the war and you support the troops, you must vote for this bill. The war that we're fighting can't be won without a safe and secure Iraq. It cannot be won without the reconstruction funding in this bill. It's just that simple.

(END VIDEO CLIP)

KARL: Now, over in the House, as many as half of the Democrats are poised to vote against this overall bill, all $87 billion.

Candy, one think for sure, it will be a very late night in the House and Senate tonight. Unclear whether or not the final vote will be tonight or tomorrow morning -- Candy.

CROWLEY: Thanks so much, CNN's Jonathan Karl, in for a late night. thanks, Jonathan.

Now, something else for lawmakers to argue about. Medicare means testing. House and Senate negotiators working on a compromised reform bill reportedly have embraced the idea of making wealthier seniors pay for more health care. As our Bill Schneider explains, some top Democrats have big problems with that.

(BEGIN VIDEOTAPE)

WILLIAM SCHNEIDER, CNN SENIOR POLITICAL ANALYST (voice-over): Means testing sounds like an idea Democrats should love. The rich pay more so the poor can pay less. Democrats are certainly eager to require a means test for tax cuts.

SEN. JOHN KERRY (D-MA), PRESIDENTIAL CANDIDATE: We are going to roll back the high end of the Bush tax cuts.

SCHNEIDER: Democrats' big complaint about the Bush tax cuts is they're not means tested. They give too much money to the rich.

REP. DICK GEPHARDT (D-MO), PRESIDENTIAL CANDIDATE: They haven't worked. Most of it went to the wealthiest Americans.

SCHNEIDER: So why do Democrats not like the idea of basing Medicare premiums on income? Every time the idea has come up in the past, it has proved politically explosive. Sure enough, now that House and Senate negotiators have agreed that wealthy retirees should pay higher Medicare premiums, Democrats are outraged.

"I oppose means testing because it heads Medicare in the wrong direction," Senator Edward Kennedy said in a statement on Wednesday. House Democratic leader Nancy Pelosi was right behind him. "Democrats stand united in our opposition to means-testing," she said.

Democrats believe social programs should be universal.

HOWARD DEAN (D), PRESIDENTIAL CANDIDATE: Everybody's going to have prescription drug coverage.

SCHNEIDER: Insurance coverage should not be based on need or ability to pay.

GEPHARDT: My plan is the best plan. It helps everybody. It helps people that are employed and unemployed, people that are part- time and full-time retirees and active people.

SCHNEIDER: Means testing Medicare premiums would save the government a lot of money. It should help protect coverage for the poor. Why don't Democrats like it? Because they fear that while means testing would make Medicare more secure financially it would be less secure politically.

Social Security and Medicare are the most popular government programs because they're available to everybody who has ever worked for a living, to rich and poor. But that's also what makes them so expensive. The benefits go to a lot of people who don't need them. Or who could afford to pay more for them. In effect, higher income Americans are being bribed to support programs that lower income Americans desperately need.

(END VIDEOTAPE) SCHNEIDER: Democrats suspect that by imposing a means test, Republicans are not trying to save Medicare. They're trying to destroy it. How? By turning Medicare into welfare -- Candy.

CROWLEY: CNN senior political analyst Bill Schneider. Thanks, Bill.

President Bush spent the morning cultivating his powerful new ally in California, Governor-Elect Arnold Schwarzenegger. Schwarzenegger had promised to ask Mr. Bush for help in reviving California's economy. But that didn't happen this time.

(BEGIN VIDEO CLIP)

SCHWARZENEGGER: I thought that the first meeting is a -- would be much more beneficial if we start the meeting by just building a relationship and building a foundation, rather than jumping in there right away and asking about specific things.

(END VIDEO CLIP)

CROWLEY: Schwarzenegger spoke after his private and public sessions with the president. Our senior White House correspondent, John King, is traveling with Mr. Bush.

(BEGIN VIDEOTAPE)

JOHN KING, CNN SENIOR WHITE HOUSE CORRESPONDENT: Grade this one a for atmospheric but incomplete when it comes to the question of whether Governor-Elect Schwarzenegger will get all the help from Washington that he says the state so desperately needs. This is the second time the two men have met. The first one was before Mr. Bush became governor of Texas. This, of course, the first meeting since Arnold Schwarzenegger became the governor-elect of California. Before a very supportive Republican crowd here in San Bernardino, Schwarzenegger introduced the president before a speech here.

SCHWARZENEGGER: There noise greater ally that this Golden State has in Washington than our president, my dear friend, President George W. Bush.

KING: The president responded by saying he was sure Schwarzenegger would be a fine leader and strong governor for the state of California and went so far as to suggest perhaps a few similarities.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: We both married well.

(LAUGHTER)

BUSH: Some accuse us both of not being able to speak the language.

(LAUGHTER)

BUSH: We both have big biceps.

(LAUGHTER)

BUSH: Well, two out of three isn't bad.

KING: The two men spent about 45 minutes together in private. Both camps described it as a very warm and productive meeting. Schwarzenegger said Mr. Bush recalled his own experience as governor and said he fully understands the plight of California now in the times of a tough economy.

Schwarzenegger also said he is convinced the president will do all he can to help California, although White House officials say there's not much Mr. Bush can do, especially in the short term because of federal budget constraints.

There is no question that the Schwarzenegger victory has the Bush camp rethinking California in terms of the 2004 election. Mr. Bush lost California last time, won only 42 percent of the vote. And the state has gone for the Democrats in the last three presidential elections.

But the White House looks at it this way. It says add up Arnold Schwarzenegger's vote and the vote for conservative State Senator Tom McClintock and more than 60 percent of Californians picked a Republican for governor.

The question now is whether that can be translated over for Mr. Bush next year. His aides say they still predict the state will be tough for a Republican to win. But they also note that since Schwarzenegger's victory, Republican fund-raising is up, Republican enthusiasm is up. And best of all from the White House perspective, Republican voter registration is up as well.

John King, CNN, San Bernardino, California.

(END VIDEOTAPE)

CROWLEY: In the race for the White House, the battle lines are drawn over Iraq and the $87 billion question. Up next, I'll ask senator and '04 Democratic contender John Edwards about his newly announced position and the pros and cons for his campaign.

We'll also check the reviews of Wesley Clark from his military colleagues to his ex-campaign manager and whether something is missing.

And, 9/11 grief gives way to frustration. We'll ask leaders of the commission investigating the attacks about the criticism they're getting from victims' relatives.

(COMMERCIAL BREAK)

CROWLEY: The House and Senate battles over the president's $87 billion aid package for Iraq are dividing the Democrats running for president. Senator John Edwards of North Carolina announced he will vote against the measure.

Senator Edwards is with me now from capitol hill.

Thanks for joining us, Senator.

SEN. JOHN EDWARDS (D-NC), PRESIDENTIAL CANDIDATE: Glad to be with you.

CROWLEY: You know -- look, you voted for this war. It seems to me that people are going to look at this and say, Well, wait a second. Part of winning this war is winning the aftermath and the president can't do it without money.

EDWARDS: Well, here's what I believe.

First, I thought it was very important to address the threat of Saddam Hussein. That's why I voted for authorization for that. But Candy, I said both then and have said consistently since that time that for this stage, going forward, to be successful, it was critical, number one, that we have the help of our friends and allies so that we're not carrying this burden alone. And number two, that we have a clear plan for how we were going to get where we were trying to go. And both those things are still missing.

I mean, today, we had a unanimous U.N. resolution. That's a good thing. I'm worried that because of the way it's been done and the lead-up to it, it may not lead to the kind of results that we need. But we're still completely absent a plan. And this is a chance for me and others to stand up and say to the president, Yes, we are -- we support our troops. Yes, we believe that America has a responsibility in going forward in Iraq. But the way you're conducting this post- military conflict period is not correct. We have to change paths. And we need to send a clear signal to this president.

CROWLEY: Senator, if I could -- you know, it's very clear that the primary voters in your party are very much against this war and it's also clear that you voted for it. If we look at this in the political sense, this looks like a way to kind of backpedal this. You know, it was a war you were for. Why not step up to the plate and say here's the money?

EDWARDS: A very simple reason -- because this policy is failing. The way this president is conducting this period of the work in Iraq is not being successful. You know, we don't have a plan, we don't know how long we're going to be there. We don't know even an estimate of the longterm costs. When is the transition from our security force to the Iraqi security force supposed to take place?

There are so many unanswered questions. And before we just give this president a blank check going forward, we need answers to those questions. More importantly, the American people need answers to those questions.

I have not backed away one iota from the importance of getting rid of Saddam Hussein. But I want this mission to be successful. And in order for it to be successful, we have to change the course that we're on right now.

CROWLEY: I have two questions to ask you and we're running out of time, so yes or no on this -- if they did attach an amendment that called for Iraq to pay back half of the loans for reconstruction, would you vote for it then?

EDWARDS: No, because that would not -- that would not give us the plan that we need.

CROWLEY: OK.

I want to talk about your fund-raising numbers and what to make of them. You're one of those that spent more than they took in. I remember talking to some of your campaign aides earlier in the summer, saying, Talk to us again in the fall, you know, if we're where we were. You know you've had trouble in the polls. What's next for your campaign?

EDWARDS: We feel great about the campaign. We've raised almost $15 million in three quarters. We're exactly on budget, where we expected to be. We want to be at about $20 million by the time we get to the first primary and caucuses in January and February.

And second, we are moving. We're moving in all the early primary states. We're now up in the double digits and in the leadership group in Iowa. We're ticking up in a very hard state for -- which is New Hampshire, because there are two -- three New England candidates in that race. But we're continuing to steadily move up. And in South Carolina, which is the third primary state, I have a double-digit lead.

So we're making enormous progress. Actually, more importantly than any of those polls or fund-raising numbers, I see the response on the ground when I'm spreading this message. To me, my message -- and it's been unbelievably enthusiastic.

Senator Edwards, we'll let you end that on that upbeat note. Thanks very much from Capitol Hill. We'll see you on the campaign trail.

EDWARDS: Thank you, Candy.

CROWLEY: Are some of the Democrats running for the White House in the red? We'll take a look at their campaign cash or lack of it when INSIDE POLITICS returns.

(COMMERCIAL BREAK)

CROWLEY: More than two years after the September 11 attacks, memorials and promises aren't enough for many victims' relatives. They want answers, and some charge that the independent commission investigating the attacks hasn't pushed the White House hard enough.

Joining us now, the committee chairman, former New Jersey governor and Republican Tom Kean and the vice chairman, former Indiana congressman and Democrat Lee Hamilton. Thank you all both. I -- this is a -- this is a tough job, emotions mixing with politics, mixing with facts.

How much of this was because you're getting pressure from the outside and relatives? And how much of this is that the FAA is hiding something?

TOM KEAN, 9/11 COMMISSION: Well, the problem we had with the FAA is that they'd told us they'd supplied all the documents they had to meet our requests. And then we find out months later that there's a whole cache of documents that are very, very important to our investigation that our staff found. They didn't find them. Our staff found them.

And so we can't have that. We had boxes and boxes come in, and it delays our inquiry and we've got to move ahead so we issued a subpoena to make sure the FAA is giving us everything that we need.

CROWLEY: Congressman Hamilton, what do you make of it? Did they lose the boxes? Did they not know that's what you wanted? Are they trying to keep information from you? What?

LEE HAMILTON, 9/11 COMMISSION: I don't think we know. The explanation we've heard from the FAA is that the central office here in Washington was informed about our request for documents, but that the regional offices were not. They claim it was just inadvertent, that the regional offices did not have the information. We accept that. We have to proceed.

We assume now that the boxes that we have will answer our questions, will give us all of the documents we need to proceed with the investigation.

But as Chairman Kean said a moment ago, the delay here as impeded us, and all of us on the commission, to your earlier question, are generating our own sense of urgency because we see that May deadline by which we must report looming. And a lot of work needs to be done.

CROWLEY: Governor Kean, let me ask you about the White House in general and the various agencies. You said in your release you'd seen some progress. But you also talked about being kind of angry. What do you suppose is behind this? Do you think you need the president to come out and say get this done? What's the hold-up?

KEAN: Actually, we're very grateful. The White House has just issued a statement as of yesterday asking all federal agencies to be sure they cooperate and treat any requests from the commission with the same force as a subpoena. We're very grateful for that statement.

Actually, we've had cooperation from most of the agencies. We have access now to over two 2 million documents, 400,000 in our possession.

CROWLEY: What accounts for some of the complaints from relatives of 9/11 victims who think that you're dragging your feet, not being forceful enough to the White House? Where's that coming from? KEAN: They're impatient and certainly, if you suffered the kind of loss they've had, you understand that impatience. We're impatient too, but we hope we'll be judged best by our final product.

CROWLEY: Congress Hamilton, you want to take a whack at that one?

HAMILTON: The governor is right. These people have suffered enormously. They're very frustrated. They know an awful lot about what occurred, but they also have a lot of questions.

And so their impatience is understandable. All of us appreciate that and I think their impatience has been transferred to members of the commission. And we're impatient. And we don't want any further delays in producing the information that we are seeking.

We must have it and we must have it soon if we're going to get our work done in the time allotted to us.

CROWLEY: Governor Kean, last question to you, because we're running out of time. Have you seen anything yet that you didn't know the day you took this job? Are you unraveling surprising things, or give me the nature what was you've seen?

KEAN: Yes, we are seeing -- we are seeing some things that I -- at least I wasn't aware of in classified documents and in some of the materials were getting. We're getting an idea of the timeline and getting -- answering questions in that area.

I must say, though, you read some of these classified documents, 200 pages long, and you've put them down and figure why is that classified? I've seen everything in that already in the newspapers.

But yes, there have been some things we've learned and will continue to learn things as the investigation goes on.

CROWLEY: Thank both of you so much. Former New Jersey Governor Tom Kean, a Republican. Former Congressman Lee Hamilton, a Democrat. We appreciate it so much. Hope to talk to you both again.

In politics, it's all about following the money. Up next, I'll look at the red ink spilling from some of the Democratic presidential candidates' campaigns.

(COMMERCIAL BREAK)

CROWLEY: Democrat Wesley Clark leads the headlines in "Campaign News Daily." He's released more than 180 pages of records detailing his military career, including glowing reviews by senior officers through the years but no endorsement from his years as NATO commander and leader of the war in Kosovo. He was forced from his post ahead of schedule to make room for a general more in favor with Pentagon brass.

Clark;s former campaign manager Donny Fowler has written a letter to Clark advising him to pay less attention to his Washington-based advisers. Fowler left the Clark campaign after two weeks at the helm. As reported in "Roll Call" his letter criticizes some of Clark's advisers who have kept other clients even after signing on with the Clark campaign. Fowler also warns Clark could lose his appeal as a political outsider.

The third quarter fund-raising numbers tell some intriguing stories about the various presidential hopefuls that go beyond political spin through the hard realities of dollars and cents.

(BEGIN VIDEOTAPE)

CROWLEY (voice-over): Push has come to shove and three of the big names in the '04 presidential race have crossed bottom line, Senators John Kerry, John Edwards and Congressman Richard Gephardt spent more money than they raised in the third quarter. Still with one exception, the three have more cash on hand than anyone else.

About that exception. Howard Dean scores best where it matters most. The most money raised this quarter, $14.8 million. Three times more than No. 2 John Kerry, and a record for any Democrat ever. Yes, even him. Most cash on hand, also goes to the former governor of Vermont.

SEN. JOE LIEBERMAN (D-CT), PRESIDENTIAL CANDIDATE: Wes Clark, welcome to the Democratic presidential campaign.

CROWLEY: Quite a flurry around newbie Wesley Clark, whose records show he raised $3.4 million, collecting in two weeks nearly as much as Gephardt, Kerry or Lieberman raised in three months and out- raising John Edwards.

In the interesting asterisk category, two former FOBs, Friends of Bill, Ted Danson and Mary Steenburgen, are now FOCs, Friends of Clark, putting in $2,000 per to the Clark campaign. Danson also ponied up $2,000 for John Edwards.

Barbra Streisand, FOAD, Friend of Any Democrat, also kicked in a thousand for Clark. She's given to other campaigns as well.

And finally, this: $49.5 million, the third quarter take for George W. Bush. The president with no primary opponent has over $70 million in the bank.

(END VIDEOTAPE)

CROWLEY: As compared to the $12 million the Democrats' top dog has on hand, begging the question will Howard Dean or any or Democrat refuse those matching federal funds in order to stuff their coffers for a long hot summer against a well financed president?

That's it for INSIDE POLITICS. I'm Candy Crowley and "CROSSFIRE" starts right now.

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