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JUDY WOODRUFF'S INSIDE POLITICS

The Money Race: John Kerry's Decision; White House Weighs in on Marathon Senate Debate

Aired November 14, 2003 - 15:30   ET

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

(BEGIN VIDEOTAPE)
ANNOUNCER: All talk and no action. The Senate debate-a-thon ends. And what do lawmakers have to show for it?

UNIDENTIFIED MALE: We're making it impossible to do public service today.

SEN. TED KENNEDY (D), MASSACHUSETTS: My suggestion is that this president release all of his right-wing turkeys.

ANNOUNCER: Queen for a day. Hillary Clinton is set to get the royal treatment in Iowa. Will anyone notice the other big-name Democrats there?

Where's the love in Florida? Is the DNS dissing a state that can and did make or break an election?

(END VIDEOTAPE)

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

JUDY WOODRUFF, HOST: Thank you for joining us. Count John Kerry out. Not of the Democratic presidential race, but of the public financing system. A short while ago, Kerry formally announced that he is following Howard Dean's lead and foregoing federal matching funds for his primary campaign.

CNN's Dan Lothian is in Kerry's home state of Massachusetts. Dan, what is the strategy behind all of this?

DAN LOTHIAN, CNN CORRESPONDENT: Well, that's right. He becomes the second Democrat now ever to forego public financing and the spending limits. And the strategy, no doubt, is that Kerry wants to be able to be freed up to take on Dean in the critical must-win states of Iowa and New Hampshire.

He made his announcement about 45 minutes ago in Iowa. And he was in front of a diner and he said, "This was a difficult decision to make." But it was an important one he had to make.

(BEGIN VIDEO CLIP)

SEN. JOHN KERRY (D-MA), PRESIDENTIAL CANDIDATE: I wish that Howard Dean had kept his promise to take federal matching money, but he did not. He changed the rules of this race. And anyone with a real shot at the nomination is going to have to play by those rules.

(END VIDEO CLIP)

LOTHIAN: Now, Kerry did vow that he would not -- Kerry did vow that he would not spend more than $45 million before a nominee is actually picked. And he called on Dean to do the same. Dean's office saying it is a long way from making a decision on spending that $45 million -- Judy.

WOODRUFF: Does this actually mean, Dan, that Kerry has the money he needs to wage a successful campaign? And, you know, how much of his wife's money can he dip into?

LOTHIAN: Well, those are two critical questions that have been asked now for quite some time, certainly since Dean decided that he would do the same. Here is what we know, that his wife's money, the Heinz money, which is estimated at anywhere over $150 million or so, we're told that that money cannot be tapped. There are regulations, there are laws that prohibit tapping that money. She would be restricted as any other donation of some $2,000.

So he would not have access to that money. What he does has access to, though, is anything that they both own jointly. And those numbers are anywhere from $300,000 to $600,000, we're told. Some of that money is from artwork that they both own.

John Kerry himself, though, has some money as well. And once again, we don't have all the numbers, but it's any about from $1.8 million to over $2 million, we've heard. So he does have a little bit of money. His campaign said he wouldn't do this if he didn't have the money, if didn't want to spend all the money. He certainly expects to do that.

And he wants to be able to have the freedom to answer any kind of attack that may come, specifically in New Hampshire. If Dean were to launch an attack there, he wants to be able to spend whatever money he has in order to counter it -- Judy.

WOODRUFF: Not sure you can win a presidential campaign on artwork, unless it's really truly rare. All right.

LOTHIAN: That's right.

WOODRUFF: Dan, thank you very much.

Well, more on money and the presidential race. In today's "Campaign News Daily," Wesley Clark has decided not to follow the lead of Howard Dean and now John Kerry. He will accept federal matching funds because, his spokesman says, it is in the best interest of his campaign. Clark today became the latest '04 Democrat to file papers to run in the New Hampshire primary. He then flew to Washington, where he was endorsed by Senator Max Baucus of Montana. We'll talk to Baucus later on INSIDE POLITICS.

Joe Lieberman takes aim at Dean in a new ad without actually mentioning his Democratic rival by name. (BEGIN VIDEO CLIP)

SEN. JOSEPH LIEBERMAN (D-CT), PRESIDENTIAL CANDIDATE: The charges are flying back and forth in this campaign. I don't think it's right to have raised a divisive symbol like the Confederate flag or to give up on principles like limiting the amount of money in campaigns, as John McCain and I have fought for.

(END VIDEO CLIP)

WOODRUFF: Lieberman is referring to Dean's remarks about courting Democrats who embrace the Confederate flag, as well as Dean's decision to forego public financing. The spot began running today on TV outlets in and around New Hampshire.

Iowa is the place for the '04 Democrats to be this weekend, unless you are skipping the contest there, like Wesley Clark and Joe Lieberman. They and Al Sharpton will be no-shows at a big Democratic dinner in Iowa tomorrow. The rest of the pact will be there, along with a certain former first lady who just may steal some of their thunder.

(BEGIN VIDEOTAPE)

WOODRUFF (voice-over): Get ready for another Clinton star turn in the Hawkeye State. The senator from New York is bringing her megawattage to Des Moines, where she'll emcee the Iowa Democrat Party's annual Jefferson Jackson dinner on Saturday. Six of the Democratic presidential candidates will be there too, trying not to fade into the background, which can be a problem any time there's a Clinton in the House.

It happened when former President Bill Clinton headlined Tom Harkin's steak fry in September.

UNIDENTIFIED FEMALE: Oh, my god. He is one of a kind, like Elvis. He really is like Elvis.

WOODRUFF: There were lots of '04 hopefuls there, too.

UNIDENTIFIED MALE: Well, even with the weather, we still have a great crowd.

UNIDENTIFIED MALE: It's a good crowd. A very good crowd.

UNIDENTIFIED MALE: Yes.

WOODRUFF: But they didn't get nearly as much attention. Still, Bill Clinton has had his turn in the White House. Hillary is the Clinton said to be harboring higher ambitions. And while she insists time and again that she won't enter the '04 race...

SEN. HILLARY CLINTON (D), NEW YORK: You know, I have no plans, no intention.

WOODRUFF: ... some people don't seem ready to believe her. The candidates will be hoping for just a sliver of the spotlight on Saturday. But Iowa bigwigs like John Kerry's state chairman, Jerry Crawford, say it's not a problem. The Clintons' glow will only help the hopefuls shine brighter.

And Iowa Democrats are clearly thrilled their annual fundraiser sold out in just 77 hours. If they don't get a chance to thank Hillary Clinton in 2004, there's always 2008.

(END VIDEOTAPE)

WOODRUFF: Well, later in the show, we'll speak with veteran Iowa political reporter David Yepsen, of "The Des Moines Register."

Well, back here in Washington, the Bush administration is trying to get in the last word after almost two days of the round-the-clock Senate debate on judicial nominations. Republicans again failed to break Democratic filibusters on three of the president's controversial choices for the federal appeals court. But the White House still is refusing to poll the nominations.

(BEGIN VIDEO CLIP)

SCOTT MCCLELLAN, WHITE HOUSE PRESS SECRETARY: Once again, a partisan minority of senators has thwarted the will of the majority and stood in the way of voting on superb judicial nominees. These obstructionist tactics are shameful, unfair and have become all too common.

(END VIDEO CLIP)

WOODRUFF: Let's bring in our congressional correspondent, Jonathan Karl. Now Jon, this thing went on for almost 40 hours. What did it accomplish?

JONATHAN KARL, CNN CONGRESSIONAL CORRESPONDENT: Judy, all talk and no action. In terms of actually breaking the impasse on the judges that have been blocked by Democrats, absolutely nothing was accomplished, because at the end of the 39.5 hours, the Republicans again tried to force a vote on three of the judges.

They only got 53 votes. They need 60. And 53 was exactly the number they had before this all started.

So nothing happened, not a single mind was changed. Nothing happened on that score. But clearly what happened here is you had raw nerves and hot tempers. After the 39.5 hours, Senator Ted Kennedy came out and referred to the filibuster judges as, "right-wing turkeys," and then he had this to say.

(BEGIN VIDEO CLIP)

KENNEDY: This chapter in the effort of our Republican friends of the judicial nominations has ended with these hours of filibuster. But what has not ended is the resolution and the determination of the members of the United States Senate to continue to resist any Neanderthal that is nominated by this president of the United States for any court -- federal court in the United States.

(END VIDEO CLIP)

KARL: That Neanderthal comment prompted a blistering response from Senator Kennedy's best friend, or one of his best friends on the Republican side of the aisle here in the United States Senate.

(BEGIN VIDEO CLIP)

SEN. ORRIN HATCH (R-UT), JUDICIARY CHAIRMAN: These are highly qualified people. You have a right, Senator Kennedy, to go against them, to argue against them with legitimate facts, not distorted facts, as has been done for months now, and especially over the last two days. But you don't have a right to smear people. You don't have the right to disparage the decency of people. You don't have a right to savage people who the Bar Association says are qualified, highly qualified.

(END VIDEO CLIP)

KARL: Senator Hatch also went on to say that Senator Kennedy's comments were "beneath the dignity of a United States senator." So although you had nothing accomplished actually throughout these 39.5 hours, at the end of it you certainly had some more name calling. And, if anything, the two sides seem more firmly dug in on this issue -- Judy.

WOODRUFF: So I guess the word "Neanderthal" is a negative term?

KARL: One would think so.

WOODRUFF: All right. Jon Karl, thank you very much.

In Florida, is it the last straw for Democrats? Up next, after Florida proved its importance in 2000, we'll ask why the DNC would risk alienating state party leaders.

Also ahead, Ari Fleischer's price. Bob Novak has the inside buzz on the former White House press secretary.

And later, Arnold Schwarzenegger gets a seal of approval days before his inauguration. I'll talk to the Democrat he's replacing, California Governor Gray Davis.

(COMMERCIAL BREAK)

WOODRUFF: Yet another political power struggle is taking place in Florida. Just one party is involved this time. State Democrats are calling for a presidential straw poll despite opposition from national party leaders. The issue will be decided this Sunday, when the state party's central committee meets.

CNN's Miami bureau chief, John Zarrella, reports.

(BEGIN VIDEOTAPE) JOHN ZARRELLA, CNN MIAMI BUREAU CHIEF (voice-over): You do the math. Florida's Democratic Party leaders say if you're not loved in Florida, you can't win the big prize.

SCOTT MADDOX, FLORIDA DEMOCRATIC PARTY CHAIRMAN: You have to have those 27 electoral votes to be president of the United States. So I need help from the candidates, from the DNC, to come down, fire up our delegates, fire up our activists.

ZARRELLA: Problem is Florida's Democrats are feeling unloved, possibly irrelevant. The party's presidential candidate could be determined on Super Tuesday, which is the week before the Florida primary. Now state party officials want a non-binding straw poll of the candidate's popularity during the party convention next month. Why? They say Florida is more representative of the nation than states with earlier primaries and caucuses.

JIM KANE, POLITICAL ANALYST: Bill Clinton in 1992 has said time and time again that if it weren't for the Florida straw poll he might not have done as well as he did in Iowa. It can give the perception that there's a winner out there.

ZARRELLA: But the Democratic National Committee is against any notion of Florida making hay with a straw poll.

(on camera): For the next three weeks, the candidates would be forced to spend more time and money here than they had planned. And it would take away from time spent in the states of Iowa and New Hampshire.

(voice-over): The DNC released a letter signed by all the candidates urging Florida's Democratic Party not to hold the straw poll and stating, "It would make it impossible for us to attend the state convention."

LIEBERMAN: You know, the kids today don't believe Social Security is going to be there for them.

ZARRELLA: Senator Joe Lieberman, who has already spent considerable time campaigning here, hopes no candidate breaks ranks.

LIEBERMAN: You know everybody signed that letter and gave their word. So I hope people are going to keep their word.

ZARRELLA: The bottom line for state party officials is simple: Florida's Democrats should have more influence picking the presidential candidate who has the best shot at keeping them from drawing the short straw again.

John Zarrella, CNN, Miami.

(END VIDEOTAPE)

WOODRUFF: Well, joining us now from Tallahassee is the man you just saw in that report, Scott Maddox. He is the chairman of the Florida Democratic Party. Scott Maddox, are you still pushing for the straw poll or have you given up on the idea?

MADDOX: Well, the big thing that we want here in Florida is we want all nine of the candidates at our state convention and answering questions from our delegates. We've got issues that are different than New Hampshire and Iowa. We want to talk about Latin American policy, we want to talk about the thousands of jobs that we're losing in Florida because people are outsourcing them, big companies are outsourcing them to India.

We want to talk about voting machines that are accountable so we don't have the fiasco that we had in the year 2000. We have Florida- specific issues.

If we can get all nine of the candidates at our convention and get them to agree to do more than make speeches, actually interact with our delegates and take questions and forums, then that's all we need. We don't have to have a straw poll. But we need them here in Florida if we're going to win in 2004.

WOODRUFF: Well, it sounds like you and others are dropping the idea. That being the case, are you going to be able to -- are you dropping the idea?

MADDOX: Well, the central committee will make that decision this Sunday. But overwhelmingly, what I've heard across the state of Florida is we just want the candidates here interacting. If they expect us to knock on the doors and make the telephone calls and carry the vote in 2004, we need their help now in Florida. They have to energize our base.

They're spending an awful lot of time in the early primary states. And 28 states and the District of Columbia will make the decision for their primaries before the state of Florida has the opportunity. Florida is a key battleground state. We need them here now.

WOODRUFF: Scott Maddox, do you feel like the DNC, the national committee undercut your state in putting this boycott, in effect, saying the candidates could not come if there were a straw poll?

MADDOX: Well, the DNC -- you know, Terry McAuliffe if my friend, he's a great chairman of the DNC. But he has his constituencies and I have mine. And I think he's doing what he thinks is best for the candidates. And I don't blame him a bit.

But I know in my heart of hearts -- I mean, I was the mayor of the city of Tallahassee and served in local government for 10 years. If we're going to win the state of Florida, we have to get in Florida now with those candidates. We can't wait until after a national convention and hope to swing it between then and the general election.

So I'm urging the candidates to come to our convention now. If they're willing to spend the time and effort necessary, then we don't have to have a straw poll. But they have to make that commitment. WOODRUFF: All right. Many people now see Howard Dean as the front-runner. If a vote were taken right now in Florida, would Howard Dean win in your state?

MADDOX: I think he would have a lot of support, but I couldn't tell you that he would win. I think Florida really is up for grabs. So many people were committed to Senator Bob Graham, our favorite son here in Florida, that opinions are just now being made about the presidential race since he has recently gotten out. So I think it's up for grabs and any one of the candidates could do well here in Florida.

WOODRUFF: So if I ask you who would do well if there were some sort of poll or voting right now, what would you say?

MADDOX: I think it would be a tossup. I think any of the candidates that have spent some time here could do very well. Many of them have very strong supporters in the state of Florida, but up until now they've been coming to Florida just to meet with fundraisers by and large part.

Every now and then they'll do a public event. We need them in Florida talking to the voters, talking to our delegates, talking to not just the givers but the workers.

WOODRUFF: We hear you. Scott Maddox, chairman of the state Democratic Party, thanks very much.

MADDOX: Thank you, Judy.

WOODRUFF: We'll wait and see. We'll be reporting on what you decide this weekend. Thank you.

Speaking of Florida, she gained fame during the 2000 election recount drama. Now some say that Katherine Harris may affect President Bush's success in Florida during the next election. Bob Novak will join us to explain.

Stay tuned.

(COMMERCIAL BREAK)

WOODRUFF: Bob Novak joins us now from the "CROSSFIRE" set at George Washington University with some inside buzz.

All right, Bob. While all of us have been focused on this tack- a-thon in the Senate over the president judicial nominations, you're saying we've missed the story going on elsewhere.

ROBERT NOVAK, HOST, "CROSSFIRE": Is the big Senate-House conference on Medicare, prescription drugs. Hot and heavy. It got so hot and heavy that Bill Thomas, the tempestuous chairman of the House Ways and Means Committee, threatened to leave. He walked out of the room.

He said he was driving to the airport to go home to California. Everybody panicked. But they found him a couple of hours later. He just didn't want to give in to the Democratic senators.

But the issue is still in doubt. They still don't have a bill.

WOODRUFF: All right. Totally different subject. One of the Democratic candidates for president, Wesley Clark, did something surprising this week?

NOVAK: It's the amazing thing of the week. On Veterans Day he made a speech in Manchester, New Hampshire and came out for a constitutional amendment against flag burning, if you will. Now, the Park Avenue liberals in New York who just love him, were shocked. They thought they had found a liberal general. Now they wonder if he's that liberal.

WOODRUFF: And we heard John Kerry say that he would punch somebody in the mouth who burned the flag, but supports the constitutional right.

All right. Moving on to Florida, newly elected Congresswoman Katherine Harris thinking about higher office. But what sort of problems does that cause for the president?

NOVAK: Well, now that Bob Graham is not running again, she's dying to run for the Senate. There's a mixed opinion on whether she would help or hurt President Bush in Florida, very important for him. The White House is say staying out of it, not taking a position.

But I am told the person they really want to run for the Senate in Florida to help the president is Mel Martinez, secretary of HUD. He's a Cuban-American, very good vote-getter locally in Orlando. And Katherine says she will not run if Mel Martinez runs.

WOODRUFF: All right. Finally, Mr. Ari Fleischer, he used to be the spokesman at the White House. What's happened to him?

NOVAK: Well, you know reporters used to get paid to ask questions to him. Now you have to pay even to shake his hand. He is doing Republican fundraisers. One in Richmond, Virginia November 24.

And Judy, you can get your picture taken with Ari Fleischer -- think of it -- for only $1,000, just $1,000. You get to go to the fund-raiser and your picture taken with him.

WOODRUFF: Just $1,000?

NOVAK: That's all.

WOODRUFF: OK. Bob Novak, we'll watch you on "CROSSFIRE" at 4:30.

NOVAK: Thank you, Judy.

WOODRUFF: Thanks very much.

Well, as of Monday, he'll be known as the Golden State's governor. So what's on Arnold Schwarzenegger's agenda once he gets sworn in? We'll take a look at his plans.

And later, who wants to marry a presidential candidate? Dennis Kucinich gets ready for a first date.

(COMMERCIAL BREAK)

(BEGIN VIDEOTAPE)

ANNOUNCER: Gray Davis gets ready to leave office three years earlier than expected.

GOV. GRAY DAVIS (D), CALIFORNIA: I have no regrets. I've enjoyed every moment. It's been nearly 30 years of public service. And I'm just anxious to get on with the rest of my life.

ANNOUNCER: So what's next for Davis? California's recall governor is our guest.

KERRY: I've changed the dynamics. And you guys watch.

ANNOUNCER: He's rough and he's tough. Call him the alpha candidate. Is this a new John Kerry?

He lost his job, but he's won our political play of the week. Stick around. We'll reveal the winner.

(END VIDEOTAPE)

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

WOODRUFF: Welcome back. California now is on the brink of the Arnold Schwarzenegger era. The secretary of state today certified the October 7 recall election result and Schwarzenegger's victory.

That clears the way for the actor turned politician to be sworn in as governor in Sacramento on Monday.

(BEGIN VIDEOTAPE)

WOODRUFF (voice-over): This is the world Arnold Schwarzenegger is used to: star-studied, glitzy and glamorous.

But Hollywood is more than 300 miles and a world away from Sacramento. So Schwarzenegger is planning a low-key inaugural, more in tune with the state capitol and the unusual circumstances that led to his election.

After he's sworn in as governor Monday morning, Schwarzenegger is scheduled to lunch with state legislators and rub elbows with chamber of commerce types. That's pretty much it. No balls, no galas. Aides say Schwarzenegger wants to send a "let's get down to business" message, especially given the state's budget mess.

Will the gesture matter? Governor Gray Davis held a frugal barbecue instead of a lavish ball to kick off his second term, and one year later, he's on the way out.

(END VIDEOTAPE)

WOODRUFF: And outgoing Governor Gray Davis joins us now from Los Angeles.

Governor, thank you very much for talking with us.

GOV. GRAY DAVIS, CALIFORNIA: You're welcome, Judy. Nice to be with you.

WOODRUFF: How would you say Arnold Schwarzenegger has handled the transition?

DAVIS: I think he's done a good job. I talk to him almost every day, and I think he has good instincts, is appointing good people and I think is off to a good start.

WOODRUFF: Is he prepared to govern the state of California?

DAVIS: I think he will be. He's made good choices so far, and I think he'll do just fine.

WOODRUFF: Is he going to be able to erase California's budget crisis?

DAVIS: Well, the economy is improving here, so we'll have the benefit of more revenue. He's still have tough choices to make. But he's got good people around him, and I think he'll do a good job.

WOODRUFF: I want to ask you about something the state attorney general said a few days ago. Bill Lockyer said he thinks there should be an independent investigation into those allegations that Mr. Schwarzenegger groped women over a number of years.

Do you think that an investigation is appropriate, or should this whole thing just be dropped?

DAVIS: Judy, from my perspective, the people have spoken. My job now is to help Governor-elect Schwarzenegger have all the information and prepare him as best I can for the responsibility he's about to assume. And I think he's in good shape.

And that whole matter will be left to other people. I'm moving on. I wish Governor Schwarzenegger well. And if other authorities want to do something, that's up to them.

WOODRUFF: You -- When I talked to you a few weeks ago in California, you, in effect, praised the women who had come forward and said you thought it was remarkable that someone would have the courage to stand up and speak what they said, speak to power, in effect.

Do you still feel that way?

DAVIS: I stand by what I said. But now, I'm in a different phase of my life. The people have spoken. They want me to hand over power to Governor-elect Schwarzenegger. I'm doing that, trying to do that in a dignified and appropriate fashion. And my job now, as I told my staff about five weeks ago, was to do everything we can to help this new team succeed.

And I know from my own experience, Judy, that when you're first coming in, you sometimes don't know the right questions to ask, and I told my staff, "Don't wait for them to ask the right questions. Just tell them all the problems and challenges that lay ahead of them and give them your best advice."

DAVIS: What about Gray Davis? I was just reading today that you're not truly ruling out running for political office again. Is that correct?

DAVIS: Well, that's what I told you when we spoke before. I say that in part because I don't know what I'm doing. Until I figure out what I'm doing, I don't want to rule anything out.

But I see Gray Davis in the private sector at least for the next few years. I do want to continue to focus on education.

Just today, there was a big story in the Los Angeles papers showing that math scores were up dramatically on some national tests. So we do have five years of improving test scores, and I'd like to keep the focus on continued investment in improved student achievement, because if these kids do better in school, they'll do better in life.

WOODRUFF: Do you think you could run for governor again?

DAVIS: I -- A, I don't -- that thought hasn't even crossed my mind. But I'm in the business of looking forward, not backward. So I just want to get on with my life, let Governor Schwarzenegger have his turn, and we'll talk to you down the road.

WOODRUFF: But you're still clearly not ruling anything out. Final thoughts, Governor, as you face your last three days in office?

DAVIS: I'm so proud of the people of this state. I learned so much about them during the recent fires, Judy. I know CNN covered them well.

But I expected to see people who were mad and depressed and angry and crying and I saw just the opposite: resilience, hope, optimism, a determination to rebuild. And I leave this office knowing that the people of this state, with their optimism and their innovation and hard work, are always going to make this a great place to live.

And it's been my honor to serve them for 30 years. If I can continue to be constructive from the private sector, I intend to be so.

WOODRUFF: Are you going to be at the inaugural on Monday? DAVIS: Yes, it's a tradition for the outgoing governor to be there. And I'll be there when he takes the oath of office, shake his hand, wish him well and get on a plane and get out of Dodge.

WOODRUFF: OK. Governor Gray Davis, thank you very much for talking with us. And we'll stay in touch.

DAVIS: Thanks, Judy.

WOODRUFF: We want to be the first to know if you do decide to run again. OK?

Thank you again. We appreciate it.

And do stay with CNN for complete coverage on the inauguration of Arnold Schwarzenegger on Monday. I'm going to be live from Sacramento with a special edition of INSIDE POLITICS.

White House hopeful Joe Lieberman is wasting no time slamming John Kerry's decision to forego public financing for his primary campaign. Lieberman suggested Kerry is abandoning important principles of campaign finance reform.

Kerry made his announcement in Iowa a little over an hour ago. He said that Howard Dean had changed the rules of the money race when he opted out of the system last week.

(BEGIN VIDEO CLIP)

SEN. JOHN KERRY (D-MA), PRESIDENTIAL CANDIDATE: The decision that I am making now is based on the seriousness of this race and the importance of beating George Bush. And that's why I have decided to give up federal matching funds in this campaign. It's not an easy decision, but it's, in my judgment, the right one.

(END VIDEO CLIP)

WOODRUFF: Opting out of the system frees candidates from spending limits.

But Kerry is challenging Dean to do what he plans to do, and that is cap his primary campaign spending at $45 million in all. The senator says he's considering taking out a personal loan to fund his campaign, borrowing against what a source calls the Kerrys' considerable assets.

Let's talk more about the '04 race with an eye toward Iowa and the big dinner tomorrow night, featuring the Democratic candidates and Senator Hillary Clinton.

We're joined by veteran political reporter David Yepsen of the "Des Moines Register."

David, do you ever get tired of being called veteran political reporter?

DAVID YEPSEN, "DES MOINES REGISTER": Makes you feel old, Judy.

WOODRUFF: David, what John Kerry is doing, is this smart? Does he have the money to catch up with Howard Dean?

YEPSEN: Well, I think personally, he probably does. I don't think it's a voting issue with people.

When Governor Dean made his decision, it was a sort of thing of enormous interest to all of us in the media and people in the political community.

But I don't hear a lot of activists around saying they're concerned. They want to beat George Bush. They know money is a big factor. And I just don't see it as a big voting issue with a lot of activist Democrats.

WOODRUFF: So somebody said that this is an act of desperation on Kerry's part. Do you see it that way?

YEPSEN: Well, I think there is an element of that. I mean, Senator Kerry clearly has got problems. He's been trying to dig out of a hole here for the last few days.

And in one sense, you know, it makes Senator Kerry look bad. He's replacing his campaign manager and his press secretary and having to do this.

But on the other hand, Judy, a lot of activists have not made up their mind about what they want to do. And they won't decide until January. And it's good for Senator Kerry to put this stuff behind him now, to try to get his campaign on track in the closing days, when it matters the most.

WOODRUFF: All right. Let's talk about this weekend.

You've got six of the nine Democrats running for president at a big Democratic dinner. The emcee is none other than New York's Senator Hillary Rodham Clinton. Is she going to be upstaging all these candidates?

YEPSEN: Well, there's that danger, and certainly, some of the campaigns are a little bit worried about that. Clearly, she's going to be on the podium with them individually. And it's only natural for people to make comparisons.

I think she could eclipse them. Or if she doesn't do well in her performance, they could even maybe eclipse her and cause her some harm.

So I think there's some risk in this for everybody. But that's what makes politics interesting. And I take this not so much as something to do with '04. I think Senator Clinton is sending a big signal to Iowa Democrats about '08 or beyond.

WOODRUFF: Well, we're going to be covering it, and I want to talk about it on Monday on INSIDE POLITICS. Very quickly, David, I want to ask you about some news this past week. You had a poll coming out showing Gephardt has regained the lead, Gephardt in Iowa over Howard Dean. At the same time, Dean picked up two big union endorsements across the country.

But in Iowa, specifically, David where does this place Dean's labor support versus Gephardt's labor support? What does this boil down to in Iowa?

YEPSEN: Gephardt has a lot more labor support. He's got endorsements from 21 unions. They have 96,000 members in Iowa.

Dean picked up the service employees and AFSCME is 13,000, 14,000 people. It's helpful to Dean, because he needs the expertise and the maturity that the AFSCME people will bring to the caucuses on caucus night. He'll have a lot of new people there. They can give him some leadership.

So I it was of help to Dean, but clearly I think it's a Dean/Gephardt race in this state.

WOODRUFF: So polls at this point a little early?

YEPSEN: Well, it is a little early. Polls show a lot of undecideds. Gephardt is way ahead among unlikely caucus goers. Dean is ahead among those people most committed to go. So this is going to go down to the wire.

WOODRUFF: All right. David Yepsen, nobody knows it better than he does. Thanks very much. Good to see you.

Another U.S. senator enlists in Wesley Clark's presidential campaign. In a minute, I'll ask Montana's Max Baucus why he's joining up.

And later, an interesting macho theme emerges in the John Kerry campaign.

And you should not miss Bill Schneider's political play of the week.

(COMMERCIAL BREAK)

WOODRUFF: More live pictures from Pawtucket, Rhode Island, where the complex involving an old mill and surrounding houses very much on fire, as you can see here. Part of the complex has collapsed. It's not known if there's anyone inside.

Officials saying they don't know yet if there are injuries or other casualties.

Police have said that this, again, an old mill complex and houses in the area are being evacuated.

These pictures coming if n from CNN affiliate, WCVB. INSIDE POLITICS will be right back. (COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

SEN. MAX BAUCUS (D), MONTANA: I'm here very proudly to endorse the candidacy of General Wesley Clark for president of the United States, and do so very enthusiastically, because I believe very strongly that he's the best person for the job.

WESLEY CLARK (D), PRESIDENTIAL CANDIDATE: I'm not here to bash the president, I'm here to replace him. And I'm incredibly grateful to Senator Baucus for his support.

(END VIDEO CLIP)

WOODRUFF: Senator Max Baucus of Montana, as you just heard, has joined the Wesley Clark for president bandwagon. He becomes the first U.S. senator from outside of Clark's home state of Arkansas to endorse the retired general.

I talked with Senator Baucus just a short time ago and began by asking why Wesley Clark?

(BEGIN VIDEOTAPE)

BAUCUS: Well, first of all, I think he's the best person, and I'm going to go for the best person.

And second I think he's more electable. When the people in our country get to know him they're going to see that this the real McCoy here. This is a real guy. This guy is good and he's going to catch on. And, I think, have better chance of eventually getting the nomination. And certainly among all the candidates, the most likely to beat George Bush.

WOODRUFF: More so than Howard Dean?

BAUCUS: I think among all the candidates, he has the best chance of beating George Bush.

WOODRUFF: One would think that the war in Iraq would be something with which you'd want to agree with the Democratic nominee. But you, in essence, supported the president on that. He says he would not have. How do you reconcile that?

BAUCUS: Well, the main thing is that I -- a lot of us in the Senate when that vote arose voted to give some spines and backbone to the U.N. We were saying if we vote for the resolution, we really want the U.N. to work harder to get more of a consensus to get Saddam Hussein out of there.

Well,frankly, the U.N. couldn't put it together. So the real question now is how to get out of this mess. And my sense is very strongly that the current administration just is -- has signals, different plans, it keeps changing all the time. But Wes Clark, given his background and experience, has a lot better idea how to get us out of this mess.

WOODRUFF: So the fact that you disagreed originally doesn't matter to you?

BAUCUS: We're different people. But I strongly trust him. I trust his sense of things. And I think the American people will too when they get to know him better.

WOODRUFF: Iowa. He has decided not to campaign in Iowa. It's clearly part of the Midwest. It's not that close to Montana, but it's out getting in your direction. And he's not even campaigning there. Does that trouble you?

BAUCUS: Well, two points. First of all, Iowa's not the West.

WOODRUFF: Midwest. I meant to say Midwest.

WOODRUFF: Second, the more important point is that's a decision left to his strategists, to his people and to him as to what's best for him. I don't get into all that. I just think as a person, as a man, as a candidate, he's the best person for the job.

WOODRUFF: I interviewed the president of the AFSCME Union -- American Federation of State, County and Municipal Employees, Gerry McEntee the other day.

He said the reason they took a hard look at Wesley Clark, they waited on their endorsement until they had a chance to talk to him. Ultimately, they were troubled, among other things, by the fact that they didn't think his organization was all that strong.

BAUCUS: I think he's going to catch on more quickly than people think. He is starting late, there's no doubt about that.

But this is -- it's partly a matter of organization. But it's more a question of who is going to connect best in the long-term and who has the best chance of beating President Bush? My sense, my judgment that it's not going to take too long to be starting late, that people will see him for who he is -- a great guy -- who -- has the greatest leadership potential qualities in the long haul to be our nominee and to be our president.

(END VIDEOTAPE)

WOODRUFF: Montana Senator Max Baucus.

And New York State Democratic Congressman Anthony Weiner also endorsed Wesley Clark today. Clark now has endorsements from 11 House members and three senators.

Well, it turns out there are plenty of women who want to be President Dennis Kucinich's first lady. Time will tell. But one of them may get an interesting consolation prize. Details next in "Campaign News Daily."

(COMMERCIAL BREAK) WOODRUFF: It's time to check the headlines in a special he-man edition of the "Campaign News Daily."

Presidential candidate John Kerry is scheduled to play ice hockey tomorrow with firefighters in Des Moines, Iowa. Earlier this week, Kerry rode a Harley-Davidson motorcycle onto the set of "The Tonight Show." He also said if he ever saw anybody burning a U.S. flag, he'd punch them in the mouth.

Hockey, Harleys and fisticuffs. Maybe there's a pattern here, harkening back to the 2000 race and Al Gore as the alpha male.

Running for president may not get Dennis Kucinich to the White House, but it turns out to be a good way to get a date. Kucinich how says that he will have dinner with the lucky winner of the "Who Wants to be a First Lady" contest on the PoliticsNH.com website.

The contest started after the unmarried Kucinich told an audience that his ideal first lady would be a dynamic, outspoken woman with a fearless desire for world peace, a full employment economy and universal single pair healthcare.

That's what he said.

Still to come on INSIDE POLITICS, he defied the government, polarized the nation and lost his job. So why did he make our "Political Play of the Week"? We'll tell you after the break.

(COMMERCIAL BREAK)

(WALL STREET BREAK)

WOODRUFF: He's out of his job, but now he could be on his way to becoming a rising political star. Bill Schneider joins us now with more on this political figure -- Bill.

WILLIAM SCHNEIDER, CNN SENIOR POLITICAL ANALYST: Well, you know defying the law and getting fired for it is not a conventional way to score a political play, unless you make it a statement of principle. Then it becomes the "Political Play of the Week."

(BEGIN VIDEOTAPE)

SCHNEIDER (voice-over): Judge Roy Moore of Alabama has made the Ten Commandments a political career.

In 1995, Moore was sued by a civil liberties group for displaying a homemade plaque of the Ten Commandments in his courtroom. He became the Ten Commandments judge and got elected chief justice of the Alabama Supreme Court.

Two years ago, he installed a granite monument to the Ten Commandments in the court rotunda. This August, a federal court ordered him to remove it. He refused.

ROY MOORE, FORMER ALABAMA CHIEF JUSTICE: I did not obey the edict of a federal judge who said we could not acknowledge God.

SCHNEIDER: This week Moore stood trial for judicial misconduct.

JUDGE WILLIAM THOMPSON, COURT OF THE JUDICIARY: This court hereby orders that Roy S. Moore be removed from his position of chief justice of the Supreme Court of Alabama.

SCHNEIDER: Moore sees himself, and his supporters see him, as a martyr, persecuted for his religious beliefs.

MOORE: It's very wrong for a public official to be excluded from his office because of religious beliefs and the acknowledgment of God.

RICHARD COHEN, SOUTHERN POVERTY LAW CENTER: He simply decided that he would defy the law. And when you're the chief justice of the state, that's not one of your options.

SCHNEIDER: The religious right usually takes up highly divisive causes like abortion and gay rights. But how many Americans are offended by the Ten Commandments?

Seventy-six percent of Alabamans support putting the Ten Commandments on display on government property. So do 77 percent of all Americans.

Could Moore have political plans?

JUSTICE TERRY BUTTS, ATTORNEY FOR ROY MOORE: He'll be back. He'll be back as a United States senator or he'll be back as chief justice, because he can run again. Or he'll be back as governor.

SCHNEIDER: Moore could challenge Governor Bob Riley in the GOP primary in 2006.

Remember Riley? He sponsored a tax hike plan that Alabama voters soundly defeated in September.

MOORE: I'll be making an announcement next week which could alter the course of this country.

SCHNEIDER: That's next week. This week, he gets the "Political Play of the Week."

(END VIDEOTAPE)

SCHNEIDER: Moore deliberately sought the showdown, and he invited media attention. He wanted his trial held in a sports arena, with thousands of spectators witnessing his martyrdom.

Doesn't sound like he feels disgraced.

WOODRUFF: Sounds like we should keep an eye on him to see where he's going next.

SCHNEIDER: Exactly, we should.

WOODRUFF: OK. Bill Schneider, thanks very much.

Well, that's it for INSIDE POLITICS. I'm Judy Woodruff. Have a great weekend.

Don't forget to join me on Monday. I'll be live in Sacramento for Arnold Schwarzenegger's inauguration as governor of California.

"CROSSFIRE" starts right now.

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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