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JUDY WOODRUFF'S INSIDE POLITICS

All Shook Up: Revamped Dean Team; Crunch Time in South Carolina

Aired January 29, 2004 - 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 shook up. The Dean campaign presses on with a party insider now at the helm and one-time golden boy Joe Trip on the outs.

HOWARD DEAN (D), PRESIDENTIAL CANDIDATE: Joe built this campaign. He built this apparatus, this insurgent apparatus. I was hoping he would stay, but he chose not to do that.

SEN. JOHN KERRY (D-MA), PRESIDENTIAL CANDIDATE: And today there is great pain here in the Palmetto State.

ANNOUNCER: But John Kerry is probably feeling upbeat, heading into a debate in South Carolina with a New ally by his side.

Look who's in New Hampshire now. President Bush goes where Democrats recently tread, while Republicans set their sights on the other party's New front-runner.

(END VIDEOTAPE)

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

JUDY WOODRUFF, HOST: Thank you for joining us.

Well, you have to say this much for the Democratic presidential race, every day is an adventure. Today's thrills and spills include a debate in South Carolina and the launch of Howard Dean's revamped campaign team. Dean is in Michigan putting a New foot forward, as he calls it, after yesterday's shake-up. How is he doing with insider Roy Kneel in his camp and Joe Trip out?

Our senior political correspondent, Candy Crowley, traveled with Dean to Michigan.

(BEGIN VIDEOTAPE)

CANDY CROWLEY, CNN SR. POLITICAL CORRESPONDENT (voice-over): Five days until South Carolina, Delaware, Missouri, Arizona, New Mexico, North Dakota and Oklahoma. So Howard Dean is headed to Michigan?

DEAN: The election is not going to be decided by pundits, and it's not going to be decided by polls. It's going to be decided by you.

CROWLEY: Down but defiant, Dean is taking the road less traveled but not the one he wanted. Faced with the possibility of getting blanked Tuesday, he is looking elsewhere to keep hope alive and resources intact.

DEAN: We're going to have to win eventually. But the question was, do we have to win on February 3? Of course we want to, but we don't have to. What we've got to do is amass as many delegates as we can. That's what we're going to try to do.

CROWLEY: Michigan and Washington hold caucuses a week from Saturday. Both have more delegates at stake than any of the Tuesday states. Dean, who's high-flying, well-funded campaign is down to its last couple of million, may not even put ads up in the Tuesday states, saving his resources where there is a chance of victory and a large cache of delegates.

Dean's reversal of fortune has changed his strategy and his staff. During a tumultuous Wednesday, he brought in Roy Neel, a Washington insider and Gore confidant, to run the Dean campaign, which prompted the the abrupt departure of campaign manager Joe Trippi, the Internet guru who both wrote and became an integral part of the Dean story. At the same time, staffers were told they will not be paid for two weeks.

In Lansing, where overflow crowds showed up to cheer him on, it was clear that of all the things that have changed, one thing has not, Howard Dean.

DEAN: All my opponents now in this race are talking the talk. Even those who voted for the war act like they opposed it.

CROWLEY: Though it is the road less traveled, Dean will still cross paths with his rival. Tonight the (UNINTELLIGIBLE) and Dean will be in a debate in South Carolina.

Candy Crowley, CNN, Lansing, Michigan.

(END VIDEOTAPE)

WOODRUFF: Tonight's debate in South Carolina will be an early test for Dean's Trippi-less team. While Dean was in Michigan, several of the rivals that he faces tonight were out stumping in the Palmetto State, including John Kerry, who picked up a coveted endorsement.

CNN's Frank Buckley has more from Greenville, South Carolina.

Hello, Frank.

FRANK BUCKLEY, CNN NATIONAL CORRESPONDENT: Hi, Judy.

John Kerry finally got Jim Clyburn's endorsement. He's been going after it for quite some time. Congressman Clyburn the most influential African-American politician here in South Carolina, in a state where there will be a significant group of African-American voters going to the polls on primary day.

Clyburn was a question mark because of his close personal relationship with Dick Gephardt, who he had been supporting until Gephardt dropped out. He told me a few days ago that it was a personal blow to him when his friend Dick Gephardt dropped out of the race. He told me he was going to chill out while he decided who he was going to support in this primary today. And finally, today he made it official it's going to be John Kerry.

(BEGIN VIDEO CLIP)

REP. JIM CLYBURN (D), SOUTH CAROLINA: And so my first priority was, in fact, Dick Gephardt. And I told everybody he was always number one in my heart. And I looked at everybody to see if anybody could dislodge that. And none of them did.

But the people of Iowa did. And so I turned my energies and my well-wishes to a great American, an outstanding Democrat, John Kerry.

KERRY: I completely understood his decision, supported his decision. And I said, "If things don't work out, I hope you'll keep me in mind." And we continued to talk and here we are today.

(END VIDEO CLIP)

BUCKLEY: Now, this could be a bit of a blow for Senator John Edwards, the Senator from North Carolina, who is staking his entire run on South Carolina, saying he must win here in South Carolina if he's to continue his race. Today, he had an appearance here in Greenville at the Allen Temple AME Church this afternoon. I asked Senator Edwards if he was disappointed in the Clyburn endorsement.

(BEGIN VIDEO CLIP)

SEN. JOHN EDWARDS (D-NC), PRESIDENTIAL CANIDIDATE: I think the world of Congressman Clyburn. And that's just the truth.

If you look at what's happened in previous states, I mean, Iowa is a perfect example. I think Governor Dean had virtually every endorsement. I mean, he had all the leading endorsements, and he ended up a distant third.

I think voters, if you get a presidential election, you can't tell voters what to do. They're going to evaluate each one to decide who they want to be their president.

(END VIDEO CLIP)

BUCKLEY: And just a few days ago, Congressman Clyburn told me that he thought that either Edwards or Kerry could win here in South Carolina. But Judy, clearly, he's given Senator Kerry a big boost by endorsing him -- Judy.

WOODRUFF: I thought it was curious that he said he thought Edwards would do well and he was endorsing Kerry to keep things competitive. But very interesting comment Congressman Clyburn made. All right, Frank, thank you very much.

Wesley Clark talked about jobs with textile workers in South Carolina before preparing for tonight's debate. This morning, Clark made an appeal to veterans in Oklahoma, a February 3 battleground where he is hoping to do well.

Joe Lieberman also campaigned in Oklahoma this morning before heading to South Carolina. His quest for votes on Tuesday got a boost in Arizona when he won the endorsement today of a major newspaper, "The Arizona Republic."

Just two days after the Democrat showdown in New Hampshire, President Bush is following in their trail. He is in the Granite State today talking about the economy while a campaign surrogate takes on the Democrats and their New front-runner.

Our senior White House correspondent, John King, is in Merrimack, New Hampshire.

John, you are where we were just up until two days ago.

JOHN KING, CNN SR. WHITE HOUSE CORRESPONDENT: Well, Judy, the Democrats have moved out, so no longer hostile territory in New Hampshire for President Bush, and no coincidence that he is here today. As the campaign turns a significant point here, the Republicans getting much more aggressive against the Democrats and specifically against the front-runner of the moment, Senator John Kerry, from neighboring Massachusetts.

Let's focus on the president first. The White House knows one key issue in this campaign will be the economy. And that is the president's focus here today in Merrimack.

He's at a Fidelity Investments campus here, and he had a roundtable earlier today. The White House making the case that the Democrats would do damage to the economy. All of the leading Democrats, including Senator Kerry, would repeal some or all of the 10-year Bush tax cuts.

The president says that is exactly the wrong thing to do. The president said the economy is beginning to take off and raising taxes would kill the recovery.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: We need to keep this money in the hands of the people of America. Listen, government's got plenty of money. And it needs to stay focused and principled.

We need to be wise with the taxpayers' money. But it turns out, when you're trying to keep your economy going, the best way to do so is not through government spending, but it's through the spending of thousands of individuals across our economic spectrum.

(END VIDEO CLIP)

KING: Now, the Republicans in the Bush campaign not ready to say just yet that Senator John Kerry of Massachusetts will be the Democratic nominee, but both at the Republican National Headquarters and at the Bush-Cheney campaign, they are beginning to think that is a likelihood, that John Kerry could emerge with the Democratic nomination unless he stumbles in the week ahead. So with that dynamic, increasing attacks on the Democratic front-runner.

Back in Washington today the Republican National Committee chairman, Ed Gillespie, leading a Republican attack, questioning directly whether John Kerry could lead the United States of America in the post-9/11 world.

(BEGIN VIDEO CLIP)

ED GILLESPIE, RNC CHAIRMAN: He voted for the use of force in Iraq, then later tried to say it was a vote to threaten the use of force. And then ultimately declared himself an anti-war candidate.

Ladies and gentlemen, John Kerry's record of service in our military is honorable. But his long record in the Senate is one of advocating policies that would weaken our national security.

(END VIDEO CLIP)

KING: Now, that attack will continue tomorrow. The Bush-Cheney campaign manager, Ken Melman (ph), will give a speech in Washington, as well, saying that if you look at Senator Kerry's voting record, that he has voted against virtually every major weapons system now critical to the U.S. military efforts in Afghanistan, in Iraq and in the broader war on terrorism.

Judy, the president and his campaign staff has always said there would come a point when they'd turn more aggressive. Mark today down on the calendar as the beginning of that point -- Judy.

WOODRUFF: And it's, what, not even the end of January yet. John, is it fair to say...

KING: A long way to go.

WOODRUFF: Is it fair to say the White House team is a little more concerned about John Kerry than they would have been had it been Howard Dean heading for the nomination, more clearly?

KING: Well, I think that is a fair statement. They felt that way two months ago, and they feel that way even more so now, because one of the key questions in every campaign is, can you take a punch and can you get up? And Senator Kerry has proven not only to the Democrats but to the Republicans that he can scrap back into the race.

And of course, the Republicans are well aware Senator Kerry, he might not be the flashiest candidate, but he doesn't make a lot of mistakes. He received a lot of credit even from Republicans for his debating back when he ran against Governor Bill Weld in the Senate race back in Massachusetts.

So yes, they view Senator Kerry as a formidable candidate. They do believe they can question his record. And it is quite a voluminous one. They believe they can call him a liberal, but they also believe he has a resume, including that Vietnam service, and he has a toughness to him. And they believe they better take notice of that.

WOODRUFF: All right. John King, not even February yet and it's already begun. Thanks a lot, John, back in New Hampshire turf.

Well, Howard Dean says his campaign will be leaner and meaner from now on. But can he compete with his momentum and his money depleted? I'll ask Dean's national campaign chairman, Steve Grossman.

Also ahead, the latest round in the Democrats' ad war. We'll tell you who's spending what and where.

Plus...

(BEGIN VIDEO CLIP)

ANEESH RAMAN, CNN CORRESPONDENT (voice-over): The days after in New Hampshire. Can you hear that? Silence.

(END VIDEO CLIP)

WOODRUFF: Aneesh Raman on the calm after the Democrats storm New Hampshire.

(COMMERCIAL BREAK)

WOODRUFF: Can Howard Dean's presidential campaign rebound after two losses in two weeks, a top-level staff shake-up and some money problems?

Joining me from Hartford, Connecticut, is the Dean campaign national chairman, Steve Grossman.

Steve Grossman, thanks very much.

STEVE GROSSMAN, DEAN CAMPAIGN CHAIRMAN: Judy, thanks for having me back.

WOODRUFF: I want to ask you first about the staff changes. You know, Howard Dean built this campaign, calling himself the outsider, the non-Washington person who could change the country. But he's now hired to run his campaign someone who has made a career here in Washington in Roy Neel, including a career as a successful lobbyist for the telecom industry.

Does that muddy the message?

GROSSMAN: No, I don't think so at all. I think a campaign as it grows needs strong, decisive leadership, and clear decision lines. That's what Roy Neel brings to this campaign, and he brings it -- and he's a distinguished guy who's had a great record. But this campaign still has that energetic, bold, imaginative pioneering quality to it, which is one of the reasons why our supporters all over the country have contributed almost $2 million to this campaign since Iowa. They believe deeply in Howard. They continue to fund it.

We raised over $250,000 yesterday. We're having another good day today. So we may be depleted a little bit, but we're reaching out. And those small donors are very generous to Howard Dean because they believe he can pick himself up, take those punches, take that (UNINTELLIGIBLE) he took in Iowa, and go on and get this momentum back. And that's exactly what we're going to do.

WOODRUFF: All right. I want to ask you about the money, but you're saying that Roy Neel's resume doesn't fly in the face of what the Dean campaign was all about?

GROSSMAN: I think with Roy Neel's experience and his ability to take this campaign and put in place the kind of strong, decisive decision-making that any campaign needs, that's what I think Roy brings to the campaign. I don't think it muddies the message at all. Howard will continue to be the outsider running to make sure that we don't lose that message of bringing outsiders and bringing the American people and giving the American people their decision-making and their democracy back.

WOODRUFF: Steve Grossman, you know better than anyone that Howard Dean raised over $40 million altogether now. But we're hearing now that most of that money has been depleted, even after coming in third in Iowa and second in New Hampshire. Is most of it gone now?

GROSSMAN: Look, I think we obviously spent a fair amount of money in Iowa and New Hampshire. And we were disappointed not to have done better. But I think that what will sustain us in the days and weeks ahead is that base of hundreds of thousands of people.

They've been contributing during the last few days $59 each. Those are hard-earned dollars. They believe in Howard Dean. They believe that the doctor who has delivered in Vermont, the person who will make this campaign eventually, I believe, a two-man race, and a referendum on results.

They believe that strong, decisive leadership and giving every child under 18 the health care and a third of the senior's prescription drug coverage. Those are results, and we are going to contrast the results that Howard Dean achieved versus what other people have done and make this the race that people want it to be. People have not lost faith, they continue to contribute. That gives me a lot of strength.

WOODRUFF: Right.

GROSSMAN: Go ahead, Judy.

WOODRUFF: Governor Dean is saying that he does not have to win any of the February 3 states. But are your supporters buying that? We understand at a conference call with members of Congress at least one or perhaps more of them spoke up and said there have got to be some wins and soon.

GROSSMAN: I think that's right. There have to be some wins soon. But you've got -- I look at this now as a unit from now until Wisconsin on February 17.

You've got the Michigan caucuses and Michigan primary. You've got the Washington caucuses on February 7. Maine caucuses on the 8.

So yes, Howard Dean has to get that momentum back. He has to pick himself up off the deck, shake off those losses, show that he can take a punch, and make this a two-person race between himself and John Kerry by sharpening those differences. That's what this is about. But I see between now and February 17 as a decisive time for the Dean campaign.

WOODRUFF: But you believe you can do that and still not win any of the February 3 states?

GROSSMAN: I don't think it's about February 3. I think it's about this whole package of states. And I think you will see Howard Dean do well in some of those states. And I think we can put some Ws up on the board.

But it's about keeping delegates, keeping the delegate hunt, and eventually sharpening this down. With all due respect to Senator Edwards and General Clark, I think this becomes a two-person race after Wisconsin. We'll be one of those two people, and we'll be contrasting our record to John Kerry all the way to Super Tuesday on March 2.

WOODRUFF: Dean campaign nation chairman, Steve Grossman, thanks very much for taking time to talk with me.

GROSSMAN: Thanks, Judy.

WOODRUFF: I appreciate it.

GROSSMAN: Thank you.

WOODRUFF: Thank you very much.

The political ad wars after Iowa and New Hampshire. Up next, we're going to crunch the numbers on television ad spending to see where the Democratic hopefuls are focusing their efforts next Tuesday.

Also, a return to normalcy in New Hampshire. Manchester tries to recover from its political hangover.

(COMMERCIAL BREAK)

WOODRUFF: With Iowa and New Hampshire behind them, the Democratic hopefuls have to spread their message across multiple states. Our consultant, Evan Tracey, of TNS Media Intelligence, is with me now to analyze where the candidates are spending their money on television ads. TNS tracks advertising in the nation's top 100 media markets.

Evan, first of all, let's look at the spending by each one of the candidates. Let's start with Howard Dean, since we were just talking to his campaign chairman. What are you seeing right now?

EVAN TRACEY, TNS MEDIA INTELLIGENCE: Well, the Dean campaign has spent about $8.5 million overall in this race, with the majority of that, over $5 million, being between Iowa and New Hampshire. Interestingly enough, he's not running any ads now in the February 3 states. But he spent a lot of money in those states, even going back to last summer.

So, essentially, he's going to walk away from that ad by money in those states. And clearly, a lot of the money he had been spending in those states was pulled out to bolster the New Hampshire effort.

WOODRUFF: He pulled them out, what, just days ago to do what in New Hampshire?

TRACEY: He pulled out the ads right as we were heading into the week between Iowa and New Hampshire. He stopped his buys in New Mexico, Arizona and South Carolina. And the only difference we could see in New Hampshire was he went through a 60-second bio spot, which costs double and you're really getting the same audience. It's a tough strategy a week before an election to try and resell your campaign with a 60-second spot.

WOODRUFF: But essentially that's what you're saying he was trying to do...

TRACEY: That's seems to be where the money went.

(CROSSTALK)

WOODRUFF: ... was sort of mend his image.

TRACEY: He really had a repair job and to get back his core support.

WOODRUFF: Now what about John Kerry? He conversely had not been running ads in any of those seven February 3 states. But now, what is Kerry doing?

TRACEY: Well, the Kerry buys in the February 3 states just started yesterday. He spent about $5 million combined on his paid media in Iowa and New Hampshire. And it's really a gamble that has paid off, because by coming out of Iowa with a win and New Hampshire with a win, the press is really carrying his message into these February 3 states. So all he really needs to do is spend some money in those states to just kind of supplement what's already being written and talked about in the media.

WOODRUFF: No way to calculate how much he's going to end up spending?

TRACEY: We're sort of looking at this to be somewhere in the $500,000 range for one week, which is not going to be a heavy buy at all considering he hasn't had any paid media in these states.

WOODRUFF: All right. What about the others, John Edwards, Wesley Clark and Joe Lieberman? What are they doing in (UNINTELLIGIBLE)?

TRACEY: The Edward's strategy is consistent with what it's been all along. He spent the majority of his $5 million in Iowa and New Hampshire. But he's also spent about $1 million between South Carolina and Oklahoma, which are going to be states that he's targeted to perform well in on February 3.

The Clark campaign is really, you know, netting this Iowa dividend. They didn't spend $5 million-plus in Iowa, and we're seeing that money go directly on to these February 3 and beyond states. So by not spending all this money on paid TV and organization in Iowa like the other campaigns, you know, granted he got no bounce out of Iowa and not much of a bounce out of New Hampshire. But at least he spent that money extending the calendar.

WOODRUFF: And Joe Lieberman?

TRACEY: Finally, Joe Lieberman, he spent again the majority of his time and money in New Hampshire. But he's quietly spent about $800 so far on Arizona TV. And he's also spent in Oklahoma. So he may have a couple of surprises maybe in those states. You know, definitely keep the campaign alive and in play through February 3.

WOODRUFF: Got a big newspaper endorsement today in Arizona. That won't hurt.

TRACEY: That won't hurt at all.

WOODRUFF: People saying nice things about him.

TRACEY: Probably see that in an ad.

WOODRUFF: No doubt about it. All right. Evan Tracey, TNS Media Intelligence, thanks very much.

TRACEY: Thanks. Great to be here.

WOODRUFF: We'll be talking to you in the days ahead.

TRACEY: OK.

WOODRUFF: The Democratic political parade has finally passed by New Hampshire. CNN's Aneesh Raman looks at how Granite State residents are getting by without all the candidates, the volunteers, and us, members of the press, tromping around.

(BEGIN VIDEOTAPE)

RAMAN (voice-over): The days after in New Hampshire, can you hear that? Silence. No more chants. No more hand shakes. No more cameras flashing. Following months of campaigns, candidates and constant national attention, a monster political hangover sets in, say New Hampshire residents like Jim Whitaker.

JIM WHITAKER, NEW HAMPSHIRE RESIDENT: I go through withdrawal. I'm a city person, and I love the hubbub of the city. And there isn't too much of that here, obviously.

RAMAN: But for Lois Daly (ph)...

UNIDENTIFIED FEMALE: It's kind of exciting to have our little corner of the world in the national spotlight for -- even if it is for a day. But yes, when you guys go, we're pretty happy.

RAMAN: At the Merrimack Restaurant, a favorite of presidential hopefuls from years past and present, a rapid return to quieter times.

UNIDENTIFIED FEMALE: During the primary, we serve about 1,200 people a day. We come in like 4:00 and we get ready. And when they go, it's like (UNINTELLIGIBLE). You know, we miss them.

RAMAN (on camera): And you wait for them to come back?

UNIDENTIFIED FEMALE: And we can't wait for the next three years.

UNIDENTIFIED MALE: I do miss the business when they leave, when the families leave. But now I can serve my regular customers the best we can, like we did before. But what can you do? And I wish they were here all the time, but that's not going to happen.

RAMAN (voice-over): The impact is immediate. Today, campaign workers off to upcoming battlegrounds. The media heading south and west. And for New Hampshire activists like Pat Morris (ph)...

UNIDENTIFIED FEMALE: Get some sleep and probably contact my family again and get back to normal. But I'm looking forward to spring. It's been a wonderful campaign, and we're exhausted.

RAMAN (on camera): A welcome respite, perhaps, but only for a few years. It's just a matter of time before the 2008 political circus comes to town.

Aneesh Raman, CNN, Manchester, New Hampshire.

(END VIDEOTAPE)

WOODRUFF: We love that town.

Well, now that New Hampshire's primary is history, as we've been telling you, the Democratic candidates have headed south and west. In a minute, we'll preview tonight's big debate in Greenville, South Carolina, and look at who was on Capitol Hill today. The former president dispensing advice. There he is.

We asked him about the presidential race. Stay with us for what he said.

(COMMERCIAL BREAK)

(BEGIN VIDEOTAPE)

ANNOUNCER: Confrontation in South Carolina. The Democrats position themselves for another debate. And prepare to take their best shots.

EDWARDS: The South is not George Bush's backyard. It is my backyard.

ANNOUNCER: From the "it" guy of the political world to out-of- work strategist. We'll look at former Dean campaign manager Joe Trippi's wild ride.

And just when everyone seems to be hopping on the John Kerry bandwagon, is a celebrity hopping off?

(END VIDEOTAPE)

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

WOODRUFF: Welcome back. Howard Dean told reporters today that campaign manager Joe Trippi's resignation was very difficult. And Dean insists he wanted Trippi to stay. But Trippi refused after Dean put former Al Gore operative Roy Neel at the helm of the campaign. It was quite a turn of events for Trippi, who masterminded Dean's unconventional campaign and made it rock.

(BEGIN VIDEOTAPE)

WOODRUFF (voice-over): Joe Trippi has left the building. And like Elvis, he's broken some hearts.

JOE TRIPPI, FORMER DEAN CAMPAIGN MANAGER: The great American myth of politics today is that I'm running the Dean campaign. I'm not. It's all these people out there.

WOODRUFF: Trippi used to call Howard Dean's campaign people- powered. Built online from the grassroots up. His vision struck a chord with scores of fresh-faced youngsters who dropped everything and moved to Burlington to work for a little-known former Vermont governor. Sure, Howard Dean was their leader. But Joe Trippi was their rock star. He tapped into their virtual reality, moving politics beyond the bounds of the traditional.

UNIDENTIFIED MALE: ...if Joe Trippi hadn't been here...

TRIPPI: I told him before you go back, he had to go home to get all his stuff. I said before you go home, I want to blog up tonight before you go.

UNIDENTIFIED MALE: Yes, it is cool.

WOODRUFF: Trippi pioneered a lot of the coolness behind the Dean machine. The meet-ups. The website.

TRIPPI: Somewhere in here it starts switching to finance... WOODRUFF: And the unprecedented online fund-raising apparatus. But now, most of the money is gone. And so is Trippi. Unable to transform virtual successes into real world wins. Meanwhile back in Burlington, the mood is somber. With one staffer describing office morale as grim and foreboding.

(END VIDEOTAPE)

WOODRUFF: A number of those pictures come from our visit to the Dean campaign headquarters in Vermont back in June.

The Dean camp might not be in such a somber place if the Iraq war had proven to be more of an issue in the lead-off Democratic contests. But it apparently was not. Here's our senior political analyst Bill Schneider.

(BEGIN VIDEOTAPE)

WILLIAM SCHNEIDER, CNN SENIOR POLITICAL ANALYST: The message from Iowa and New Hampshire is clear. Democrats do not want to turn the election into a referendum on Iraq. Sure, Democrats are anti-war. Two-thirds of the Democratic voters in New Hampshire said they disapproved of the decision to go to war. But most anti-war voters didn't vote on the basis of the war. Only 22 percent said Iraq was the issue that determined their vote. Just as many said it was jobs. Even more said health care. The candidates, like the voters, basically agree on Iraq.

EDWARDS: Everyone on the stage has been critical of the way George Bush has conducted this phase of the operation.

SCHNEIDER: Oh, sure, there are differences. Of nuance. One enthusiastic war supporter.

SEN. JOE LIEBERMAN (D-CT), PRESIDENTIAL CANDIDATE: I'm the only person on this stage who has unwaveringly supported the removal of Saddam Hussein.

SCHNEIDER: That didn't get him very far. And there's one ardent war critic who insists he should get credit for being right on the war first.

DEAN: My conclusion was that we'd successfully contained Saddam Hussein.

SCHNEIDER: But that didn't get him very far either. The capture of Saddam Hussein last month was a turning point for most Democrats. But not Howard Dean.

DEAN: My position on the war in Iraq has not changed.

SCHNEIDER: That's when Dean's support in Iowa started dropping. The signal from Democrats in Iowa and New Hampshire, where there has been a campaign is, we're ready to move on. If Democrats don't want the election to be a referendum on Iraq, what do they want it to be? A referendum on George W. Bush. After all, most Americans support the war. But they're divided over President Bush. To beat Bush they have to find a candidate who can match him on national security. So that when President Bush talks about what he's doing to protect the country, Democrats can answer...

KERRY: Bring it on!

(END VIDEOTAPE)

SCHNEIDER: After the Democrats' disastrous experience in the 2002 midterm election, former president Clinton told his party, strong and wrong beats weak and right. It looks like Democratic voters heard him.

WOODRUFF: And former president out there dispensing advice again today. We're going to hopefully have a little reporting on that. Bill, thank you very much.

When the '04 Democrats debate tonight in South Carolina, John Kerry may have the most to prove. Sure, Howard Dean and his newly shaken up campaign are angling for a comeback but Kerry has to live up to the great expectations set by his wins in New Hampshire and Iowa. Then there are those nagging questions about his appeal in the south. CNN's Kelly Wallace is in South Carolina covering Kerry and his latest endorsement. Hi, Kelly.

KELLY WALLACE, CNN CORRESPONDENT: Hi, Judy. One of the biggest challenges right now for Senator John Kerry is trying to build an organization and support here in South Carolina, because the last time he campaigned here was in early September. But as you said, he got a very big boost earlier this morning, and that is when he won the endorsement from Congressman Jim Clyburn. He is the state's most popular African-American lawmaker, and he could help John Kerry appeal to African-Americans who could make up to 50 percent of those going to the polls on Tuesday.

Now John Kerry is trying to do something else here, too. He is trying to prepare for possible attack that could come from his Democratic opponents at tonight's debate. He is also dealing with attacks that are already coming from the Republican party. Earlier today, the Republican party chairman Ed Gillespie criticizing Senator Kerry's record in the Senate, saying his record shows he can be weak when it comes to national security issues. That his policies would not make the United States any safer. We asked Senator Kerry about that today, and he seemed to enjoy firing back.

(BEGIN VIDEO CLIP)

KERRY: With respect to Mr. Gillespie. Listen, it's the greatest form of flattery. Bring it on. Let's have this debate.

(END VIDEO CLIP)

WALLACE: And there's one other challenge for John Kerry. And that is he must prove that he is not writing off the south. Not too long ago in New Hampshire, he said that Democratic candidates often make the mistake of, quote, "looking south." He was asked about that today and he said what he was talking about is how he believes that Democratic presidential candidates could win the presidency even without winning southern states. But he said that does not mean he won't be campaigning aggressively here. He says he intends to do that. And Judy, he says if he's the nominee, he hopes he can win some states in the south -- Judy.

WOODRUFF: I can imagine, Kelly, they were asking for a little clarification down there. Thanks a lot.

WALLACE: Yes, they were.

WOODRUFF: Well, what does Bill Clinton think of this presidential race right now? He was on Capitol Hill today talking politics. And we couldn't resist asking about the race for the White House. His answer coming up.

Also ahead, I'll ask the governors of Arizona and New Mexico about their state' unusual chance to have a big say in the race for the nomination.

And just ahead, in the campaign news daily, a roundup of some interesting endorsements and a surprising nonendorsement on the campaign trail.

(COMMERCIAL BREAK)

WOODRUFF: The race for endorsements leads the headlines in our campaign news daily. There's a strong effort to win congressional support for Senator Kerry's White House run. Massachusetts representative Ed Markey and Kerry's fellow Bay state Senator Edward Kennedy are leading the charge to sway undecided lawmakers. Kerry picked up two newspaper endorsements today. The Santa Fe "New Mexican" and the "Detroit Free Press."

The Detroit paper says that while Kerry is, quote, "neither the most dynamic campaigner nor the smoothest speaker, he is an effective leader with the credentials and ideas to be the party's strongest national candidate."

New Mexico's primary is Tuesday. Michigan's caucuses will be held four days later. A source who has spoken with Michigan labor leaders tells me that the United Auto Workers will not endorse John Kerry or anyone else before this Tuesday's contest. UAW's leaders described as favoring John Edwards over John Kerry because of Edwards' working-class background, as well as his views on trade. The union is expected to reconsider making an endorsement after it looks at next Tuesday's results. INSIDE POLITICS will be back in a moment.

(COMMERCIAL BREAK)

WOODRUFF: Democratic lawmakers invited former president Bill Clinton to come up to Capitol Hill today and talk politics. The private strategy session was supposed to last about 90 minutes. It stretched on for more than three hours. A source who was in the room says Clinton suggested that Democrats need to do a better job defining the issues, And suggested that they get a campaign manager to run their message machine. After the meeting, reporters asked the former president about the current race, and especially about senator John Kerry.

(BEGIN VIDEO CLIP)

WILLIAM J. CLINTON, FMR. PRESIDENT OF THE UNITED STATES: All I know is, when I was trying to reverse 12 years of what we've had for the last 4, where we were taxing less and spending more, it's fun in the short run. But it's a recipe for disaster. And we were running this huge deficit. He was there to help. And so, I think it's going to be -- he was good on security, good on fiscal responsibility, good on welfare reform. And I still think we got a good feel.

And by the way, you may know what's going to happen, but I don't. And I like all these people. I admire them. They made a contribution to whatever good I was able to do for the American people, and I'm not going to get involved in it. But I don't think it's fair to say he can't be elected or that he's too far to the left.

(END VIDEO CLIP)

WOODRUFF: Bill Clinton on John Kerry.

Races for presidential nominations are usually long decided by the time western voters get to have a say. But for Democrats in Arizona and New Mexico, this year is different. The Arizona primary and the New Mexico caucuses are on the same day, next Tuesday.

I'm joined now by the governors of both states, and they are both Democrats. Arizona Governor Janet Napolitano, she joins us from Phoenix, New Mexico Governor Bill Richardson is in Santa Fe. Governor Napolitano, let's start with you. Arizona has, what is it, 55 delegates up?

GOV. JANET NAPOLITANO (D), ARIZONA: Yes, 55 delegates up on Tuesday.

WOODRUFF: Now that the presidential candidates are heading to the West, to the Southwest, what is it that they are -- your voters are looking for? How is a contest for votes going to be different than what we've seen in Iowa and New Hampshire?

NAPOLITANO: Well, I think some of the issues will be the same. Our voters are looking for candidates who have a positive plan on the economy, on creating jobs, on health care, on education. They're looking for candidates with a strong record in foreign policy, but they're also are going to be looking very carefully to what the candidates say about issues such as immigration that particularly impact the border states.

WOODRUFF: And what about this whole question of electability, who can beat President Bush? How much of a factor?

NAPOLITANO: Oh, for Democratic primary voters in every state, I think that's a very important factor. Ultimately the nominee is going to be someone that we put in the field, who will be running a very strong race against the incumbent.

WOODRUFF: Governor Richardson, New Mexico, 26 delegates up for grabs. What are voters in New Mexico looking for here that's different from what we've seen in New England and Iowa?

GOV. BILL RICHARDSON (D), NEW MEXICO: Well, as Governor Napolitano said, New Mexico voters care about jobs, health care, foreign policy, Iraq. But what is different at least about New Mexico is a majority of those voting in the caucus are going to be minorities, primarily Hispanic, a little sprinkling of Native Americans, close to 55 percent. So this won't be the first time the presidential candidates, with both Arizona and New Mexico, will face significant number of Hispanic voters. So issues relating to bilingual education, immigration, issues relating to civil rights are important, border issues, trade with Mexico, NAFTA-related issues. But also in our state, we've got four military bases. So, a good national security background is important.

WOODRUFF: Governor Napolitano Arizona, how would you size up the state of the race in Arizona?

NAPOLITANO: Oh, I think it's wide open right now. The latest poll that came out had half the voters still undecided. To dovetail on a point made by Governor Richardson, a lot of our primary voters are going to be veterans, so the military issues are important. I think that's why General Clark made Arizona his first visit after New Hampshire.

WOODRUFF: But you've already had some, what is it, General Clark spending money on ads there.

NAPOLITANO: Yes, he's had a lot of media. Senator Lieberman has purchased a lot of media. Howard Dean purchased a lot. I understand Senator Kerry has a buy in. So, there's a lot of activity in Arizona right now. It's very exciting.

WOODRUFF: And Governor Richardson, what about the state of play in New Mexico? How would you size it up right now?

RICHARDSON: Well, enormous interest. Record number of request for absentee voters, a lot of signs, TV up. I would say right now, General Clark and Governor Dean are perhaps the top at this very moment. But with Senator Kerry surging dramatically, and at the same time Senator Edwards, too, has been here many times, a big organization. But I would say it's going to be between the three, General Clark, Governor Dean and Senator Kerry. But the explosive momentum that Senator Kerry has at this moment here in New Mexico is quite noteworthy.

But it's going to be very close. I would say in the three top tier candidates are at about 20 percent, with close to 40 percent, undecided at this very moment.

WOODRUFF: Governor Napolitano, we're now hearing Governor Dean say that he does not have to win any of the February 3rd states, that he can look beyond that. He can wait for Michigan, Wisconsin, later on down the line in February. Is that a smart strategy from your perspective?

NAPOLITANO: Well, I'm not going to second-guess Governor Dean's strategy. I think he may be leading the predicate in case he doesn't win any of those February 3rd states that he's going to keep going on. But in my view on February the 3rd you have a great test of a national race. You've got a state in the south, you've got a large Midwestern state, and then you've got two states in the Southwest with burgeoning Democratic populations, but also burgeoning minority populations. So I think Tuesday the 3rd gives us the first true national test of who will be the national nominee.

WOODRUFF: And Governor Richardson, on that point, can Governor Dean afford to wait for a win until after February 3rd? Can he afford to put more of his eggs in the February 7th and 17th baskets?

RICHARDSON: No, I believe he needs a win. He's been in second place in the last primary. He needs a win here in the seven states on Super Tuesday.

But I would, at the same time, agree with his strategy that this is going to be protracted nomination battle. There are other important primaries. But, he needs a win here. I do think that Senator Edwards needs a win somewhere in the seven-day primaries. But, again, Arizona and New Mexico, two barometer Western states, battleground states. I think they're the two that are going to be most closely watched.

WOODRUFF: And just quickly Governor Napolitano, momentum. Governor Kerry -- I mean, sorry, Senator Kerry coming into your state having won Iowa and New Hampshire. Does that help him and if so, how much?

NAPOLITANO: Oh, I think it does help him. I think it helps him materially. He is going to have momentum from those two major victories. No doubt about it. Particularly with the significant percentage of the voters who are still undecided.

WOODRUFF: All right. We're going to have to leave it there. Governor Janet Napolitano of Arizona, Governor Bill Richardson New Mexico. We appreciate both of you joining us this afternoon. We're going to be watching both your states on Tuesday. And always.

NAPOLITANO: Thank you.

RICHARDSON: Thanks.

WOODRUFF: Appreciate it.

Coming up next, Donna Brazile and Bay Buchanan standing by to take issue on Howard Dean's campaign shake-up and to look ahead to February 3.

(COMMERCIAL BREAK)

WOODRUFF: With us now former Gore campaign manager Donna Brazile and Bay Buchanan, president of American Cause. Bay, I'm going to start with you. Howard Dean shaking up his campaign, bringing in a former Gore man to run it. Is this going to fix things for him?

BAY BUCHANAN, PRESIDENT, AMERICAN CAUSE: First of all, he's got to figure out what happened to all that money. He's pulling ads off television. I understand he's not up anywhere right now. This is very bad news for a guy that was a front-runner 30 days ago. He's got to shake up something and turn things around. But I think it's a long shot for him to recover.

WOODRUFF: Donna Brazile, you know Roy Neel very well. What's going to happen in the Dean campaign?

DONNA BRAZILE, FORMER GORE CAMPAIGN MANAGER: Joe Trippi was the architect of the Internet movement, the really ground-savvy campaign. Roy Neel is more of a carpenter. He's a builder. He can build an infrastructure around Dean and begin to harness a tremendous grassroots support that the Dean campaign has generated and turn it into a campaign and remove it from being what I call a bunch of individuals running a campaign but now it will be more like a presidential campaign.

WOODRUFF: Is it a problem, Donna, Howard Dean has talked about he's the quintessential outsider. Roy Neel, however much you may like him personally, has been in Washington for many years. He was a major lobbyist for the telecom industry. Is that in any way muddy up the Dean message?

BRAZILE: I don't think the personnel that you hire necessarily translate into the type of person you are, and where you hope the country will be. It is true that Roy Neel is an old, experienced Washington hand. But you know what? The Dean campaign could use a steady hand right now. Someone who understands the political landscape. And really, Roy is a grown-up. He's mature. He can do it.

BUCHANAN: Donna makes a good point. They've been run by media people. And they really need organization. Somebody who can bring the media in together with a strong organization. That's where they were missing out there in Iowa. That really was a major flaw in the campaign.

WOODRUFF: I'm going to ask you both the question I just put to Governors Napolitano and Richardson, and that is can Governor Dean get away with not so much focusing or at least saying that he's not focusing on February 3rd states and just essentially saying it's okay if we don't win one of them, we can afford to wait until Michigan, Washington state and Wisconsin?

BUCHANAN: No. It's absolutely foolhardy. I'm astounded that anyone could come up with this idea as a possible strategy that could win. I think what they're doing is doing the only thing they can. They have no money for seven days from now. That's why they're not worrying about next Tuesday. They're going to try and hopefully pull this thing back out in 14 days but I don't think they can do it.

Judy, I think you've got two guys out there with some real momentum, especially Kerry. Enormous momentum. That's like a locomotive gone down that train. It's going to pick up more speed and on Tuesday, and you've got some guy that's going to try to stop it halfway down the track. It's going to be impossible in my opinion. I think Edwards could pick up some momentum on Tuesday and you're going to have a hard time stopping either of them.

BRAZILE: Without the ability to pay for media, he needs some free press and good free press. In order to get that he has to win next week.

WOODRUFF: So in other words for him to say I can wait until Wisconsin and Washington state, Michigan...

BRAZILE: That's a fantasy. You've got to win one. I don't know any campaign manager that can go that long without a win underneath their belt. He needs to win and he needs to win next week.

BUCHANAN: He's allowed someone else to get all the momentum, and they're moving down there, picking up delegates, appearing like he's an absolute winner of this thing or else the challenger to the front- runner.

BRAZILE: He can win the North Dakota caucuses. I know that's small. It may not come in until after midnight on Tuesday. He can also go to Delaware and compete with Joe Lieberman on the ground to get those votes. The last thing he should do is just pin his hope on Detroit and Seattle. Those voters will not save him if he loses next week.

WOODRUFF: And we just heard Governor Richardson say in New Mexico that Dean does have some strength in his state but it remains to be seen. Very quickly, could these candidates next Tuesday be scattered all over the lot with one winning Delaware, one winning South Carolina, another Oklahoma, another Missouri and we have a completely mixed up outcome?

BUCHANAN: There's no question that could happen. But I think the key for Kerry is to go right there to South Carolina. Because I believe the strongest opponent is Edwards. Edwards is a sleeper in this race. He could come out of this, get some real strength.

BRAZILE: He better look over his shoulder in Missouri because Edwards is coming on strong in Missouri. They could all win next week and we could have a whole new race the following week.

WOODRUFF: And we would love that, wouldn't we?

BRAZILE: Yes.

WOODRUFF: Donna Brazile, Bay Buchanan, we like those stories.

He performed at a John Kerry fund-raiser. But, he could be having second thoughts. Political ramblings from technorock musician Moby and the latest candidate to catch his attention.

(COMMERCIAL BREAK) WOODRUFF: Technorock musician Moby gave John Kerry a certain hip factor last September when he performed at a Kerry fund-raiser in Boston. Kerry even took the stage and played a little guitar at the event. Recently, however, Moby posted a note in his web journal praising another candidate, Democrat Al Sharpton. In Moby's words, quote, "Al Sharpton is the Democratic candidate who would, in many ways, be the best nominee. If Al Sharpton actually had a chance, I would support him in a heart beat."

Moby went on to add that he will support whomever wins the Democratic nomination but he calls Sharpton the most compelling candidate.

Well, that's it for INSIDE POLITICS. We make music as well as politics. I'm Judy Woodruff. Thanks for joining us. "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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