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JUDY WOODRUFF'S INSIDE POLITICS

Karl Rove's Call; Kerry's Absence: Is his Campaign Suffering?; Interview With Karen Hughes

Aired April 1, 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: Karl Rove on the line. Find out why the president's top strategist is calling "INSIDE POLITICS" to downplay his own success.

John Kerry on the mend. Is the time off he's taking after minor surgery injuring his campaign?

The sparks fly when the chairs of the Bush and Kerry campaigns face off for the first time in our exclusive interview.

(END VIDEOTAPE)

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

CANDY CROWLEY, HOST: Thanks for joining us. Judy is off this week. I'm Candy Crowley.

To our knowledge, no one has ever accused Karl Rove of being overly modest about his skills as the president's top political strategist. So it may come as something of a surprise to learn that Rove suggests the campaign does not deserve some of the kudos it's been getting.

What's he thinking? Here's our senior political analyst Bill Schneider.

(BEGIN VIDEOTAPE)

WILLIAM SCHNEIDER, CNN SR. POLITICAL ANALYST (voice-over): Something seems to be working for President Bush. Is it the ads or is it the buzz?

On Tuesday, we reported that in our latest poll, President Bush has pulled ahead of John Kerry in the 18 states where the Bush campaign has been running ads. But the race is still neck and neck in the rest of the country.

Now the editorial cartoons are saying President Bush's attack ads are defining John Kerry. Maybe even distorting him. White House political strategist Karl Rove called CNN to say he thinks we're giving too much credit to the Bush campaign's anti-Kerry ads.

For one thing, the campaign started out in early March, with a positive ad launch in those 18 states. A 30-second silent ad, and a 60-second ad featuring the president and the first lady.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I know exactly where I want to lead this country.

SCHNEIDER: The White House claims those ads have had time to sink in. Unlike this 30-second ad, critical of Kerry that started running in mid-March.

UNIDENTIFIED FEMALE: John Kerry's plan? To pay for new government spending, raise taxes by at least $900 billion.

SCHNEIDER: "I can't see one ad driving up Kerry's negatives," Rove told CNN. But how do you explain this? Two months ago, before the ads ran, opinion of Kerry was 66 percent favorable in the 18 mostly swing states. More favorable than in the rest of the country.

And now? Favorable opinion has dropped sharply in the 18 states that saw the Bush ads. It's now lower than in the rest of the country.

The Bush campaign says it wasn't our ads, it was the buzz. People changed their views of Kerry because of what of what they saw in what's known as the earned media, news reports of the campaign, including President Bush's visits to those states where he said things like this about John Kerry...

BUSH: He's an experienced senator. And he's built up quite a record. In fact, Senator Kerry has been in Washington long enough to take both sides on just about every issue.

(END VIDEOTAPE)

SCHNEIDER: The Bush campaign did help create that buzz. Bush- Cheney national spokesman Terry Holt told CNN, "We have an extensive echo chamber of volunteers and local supporters who help us get our message out across all of the media."

CROWLEY: You know, I don't think, Bill, anybody doubts the power of the free media. And that's what the presidential candidates like. But are there other factors at play, the primary or anything else?

SCHNEIDER: Yes. Well, Rove said that he believes the Democratic campaign was truncated too early for Kerry to really benefit.

He thought it really was to Kerry's disadvantage because voters had a vaguely positive image of John Kerry as a war hero who kept winning week after week, every Tuesday night. And now a different image is setting in.

But the Bush campaign says it's not because of our negative ads. They don't want people to think it's their attack ads that are hurting John Kerry.

CROWLEY: No, I don't imagine. Attack ads sound bad.

SCHNEIDER: Yes. CROWLEY: Thanks so much, CNN's senior political analyst, Bill Schneider.

The Bush and Kerry camps are going at it again on the subject of presidential debates. The Kerry team is renewing its call for six face-offs in battleground states. But the Bush crew isn't taking the bait.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: I think it would be great if we could agree to accept the Kerry campaign challenge to debate so that people everywhere can hear the real issues in this campaign.

UNIDENTIFIED MALE: What I would suggest to you is that Senator Kerry ought to debate himself and come to a conclusion about so many different issues before he challenges anybody else. I mean, it's hard to know where he stands on a given issue on a given day.

(END VIDEO CLIP)

CROWLEY: The Bush and Kerry campaign chairs butt heads on more than that in our exclusive interview. The full fireworks are ahead on "INSIDE POLITICS".

John Kerry might be issuing that debate challenge himself if he wasn't holed up at home after some minor surgery to repair a shoulder tendon. Some wonder if Kerry can politically afford to be off the trail for several days, especially so soon after an Idaho vacation.

We want to talk now with CNN national correspondent Kelly Wallace.

Kelly, is there any worry inside the Kerry campaign that even though this is very early, that, in fact, this might be time lost that he can't afford?

KELLY WALLACE, CNN NATIONAL CORRESPONDENT: Well, Candy, no surprise. No worry inside the Kerry campaign. Advisers say they have a plan, and they are sticking to it.

When you talk to some other Democrats, though, privately, one I talked to said, look, if he were running the campaign, he would have had Senator Kerry have his surgery on the first day of his vacation, and then keep his snowboarding in Idaho to a minimum. But this all being said, Kerry's advisers say they're right on track.

They are now in the process of rolling out a number of new national advertisements focusing on jobs, including one which CNN has obtained. This new ad will begin running in 17 battleground states beginning tomorrow. And it aims to hit the Bush administration on the very hot topic of outsourcing.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: George Bush says sending jobs overseas makes sense for America. His top economic advisers say moving American jobs to low-cost countries is a plus for the U.S. John Kerry's proposed a different economic plan that encourages companies to keep jobs here.

(END VIDEO CLIP)

WALLACE: The campaign also did something else. It announced today that in the first three months of this year, John Kerry has raised more than $40 million. The campaign is saying this is a record, shattering what had been a record for the Democrats, that of Howard Dean in the last three months of 2003, raising $15.7 million.

So Kerry's advisers think he has been focusing on raising money. They're also touting the latest national poll, this one in the Los Angeles Times, which says if the election were held today, 47 percent would vote for John Kerry, 44 percent for George Bush. A statistical dead heat when you look at the margin of error being plus or minus three percent.

But, Candy, this all coming, as Bill noted, the CNN poll showing that John Kerry's unfavorables have gone up. His favorables have gone down. To that, Kerry's advisers say, look, some of what President Bush and his aides have been saying is sticking, but they believe, ultimately, the more they focus on jobs, outsourcing, and the economy, that Kerry will do better -- Candy.

CROWLEY: Thanks so much. CNN's Kelly Wallace. Appreciate it.

Checking the headlines in "Campaign News Daily," the AFL-CIO has launched a new ad campaign today criticizing President Bush. The ad features clips from the president's State of the Union Address, contrasted with the comments of Americans looking for work.

(BEGIN VIDEO CLIP)

BUSH: The American economy is growing stronger.

UNIDENTIFIED FEMALE: My industry is pretty much gone, and a big chunk of the middle class is pretty much gone along with it.

BUSH: Manufacturing activity is increasing.

UNIDENTIFIED MALE: Worked at a job for 25 years. It's gone. My life's gone.

(END VIDEO CLIP)

CROWLEY: The ad is scheduled to run for one week across 11 states at a cost of more than $1 million.

Earlier this hour, President Bush signed the Unborn Victims of Violence Act into law. The measure makes it a federal crime to harm a fetus during an assault on a pregnant woman.

Anti-abortion groups, key political supporters of the president, welcomed the new law. Abortion rights groups were opposed. John Kerry, in case you were wondering, voted against the measure in the Senate.

All it takes is three numbers: 5, 2, 7, to get a rise out of top officials in the Bush and Kerry camps. Up next: our exclusive showdown between the chairs of the dueling presidential campaigns.

Plus, Democrat Dennis Kucinich will go beyond the obvious question about why he's still running for president.

And we'll talk to presidential adviser Karen Hughes as she raises her profile with a new book and a return to active duty on the campaign trail

This is INSIDE POLITICS, the place for campaign news.

(COMMERCIAL BREAK)

CROWLEY: Karen Hughes, the longtime adviser to President Bush, has written a memoir about her many years working with George W. Bush from Texas to the White House. The book is titled "Ten Minutes From Normal."

Karen Hughes joins me here in Washington.

How many minutes are you from normal at the moment?

KAREN HUGHES, PRESIDENT BUSH ADVISER: I don't know. The book is a story of what it feels like to be a normal person like me, whose boss suddenly runs for president and becomes the president of the United States. And, you know, I really think it's a fun book, it's a personal book.

I wanted to write about some of the things that we all struggle, with to balance career and family. I know you've struggled with that over the course of your career. And talk about setting priorities in life.

So it's really a bigger book than just a political memoir, I think. It's about the struggle we all face every day in our lives to allocate our time. And I also wanted to write about people in the political process in a very human way, because I think sometimes with all the headlines and political cartoons they become -- they're almost created as caricatures as opposed to real human beings.

For example, I talk about being in the grocery store squeezing tomatoes while I'm on a conference call with Colin Powell and Condi Rice. And imagine what my fellow shoppers would have thought.

CROWLEY: And what were you talking about, is what we want to know?

HUGHES: The Sunday shows. We were doing briefings for the Sunday shows.

CROWLEY: Now, you know, you obviously made a huge splash when you left. You know, the most powerful woman in Washington, and went back for family reasons. Your son wanted to be back, but you all wanted to be back there. When you went back there, how different does what -- how things play in Washington look from Austin?

HUGHES: It's very different. They call me frequently to ask me what I think. Condoleezza Rice or Dan Bartlett or the president occasionally will call me and say, "How's it look from out there?" Because it's very different.

You know, here in Washington, it's obsessive. What was said on Capitol Hill today? Or, what was said at the White House today? Or what's in the newspaper headline? Or what's in role call?

And, you know, out in the country people are about their lives. And they're at the baseball game. And I remember very early after I had moved back one morning, I called the White House and they were all agitated about some story in the newspaper. And I had read the newspaper and hadn't even seen it -- I mean, hadn't even noticed. And so I was able to say, "Don't worry, I don't think too many people are really as obsessed about that story as you are."

CROWLEY: And let me look at some of the things we are talking about today. One of them is Laci's law, what's known as Laci's law, which the president has signed into law, which makes it quite an offense to harm a fetus in an assault on a woman.

A lot of people, and some of the conservatives for the president, think this is a way to go into court to battle Row v. Wade. Is that what the president has in mind?

HUGHES: Well, I'm not a lawyer. What the president wants to do is to say -- to recognize that a violent crime against a woman is also -- who is pregnant -- is also a violent crime against her child. And if a woman is murdered, there are two lives at stake here, not just one.

And the president has talked a lot about creating a culture where every child is welcomed in life. And I think this is a step toward creating that kind of culture where we value children.

CROWLEY: And that sounds sort of where people read nuance, even if it's not in Texas, that he would like to overturn Roe v. Wade, that he sees it...

HUGHES: Candy, I think the president has clearly said that he doesn't believe the country is ready for that. He doesn't think the country is at a point where that is doable or that the country would support that.

What he has said is that we need to encourage things to show respect for life. Things like the law he signed today, things like encouraging adoption. That there's a way to bridge this polarized debate by doing things that can help encourage a culture of life as a step in that direction.

CROWLEY: We have what you've seen -- I know from Texas and elsewhere -- a steady sort of decline in the polls in the way the president is viewed in the fight on terrorism. A lot of it has to do with Iraq. We've seen what happened in Fallujah yesterday, where American citizens were burned. Crowds cheering.

HUGHES: Horrible, horrible.

CROWLEY: Charred bodies hung. What is the appropriate White House response to this is? What do you do on the ground there?

HUGHES: Well, I think what we see is so sickening that it reminds us of what's at stake. It should remind us of the -- you know, these are the forces of chaos and terror that we are battling. And we're battling them there so that we don't have to battle them here.

The enemy clearly is trying to break our will or break our resolve. And my view is that incidents -- horrible, ugly, awful incidents like the one yesterday should only remind the American people of the tremendous stakes and the need to continue to relentlessly waging this war against terror, and also rebuilding a stable and democratic Iraq, because that is the path toward a more peaceful world and a more secure America.

CROWLEY: I need to get two quick answers from you. Condi Rice, when will she be testifying? Has that been settled?

HUGHES: I don't know the answer to that. I understand the White House has said they would like it as soon as possible. I think I'm reading just as you are that the idea of perhaps next week. But that's going to be announced by the 9/11 Commission.

I'm pleased she's going to testify. I think it's important that she be able to present the facts to the American people because I think, frankly, last week they got a rather distorted view.

CROWLEY: August 15, you're back as the president's adviser on the campaign trail with him. And your first piece of advice will be?

HUGHES: Let's go win the election.

CROWLEY: OK. I should have known that.

HUGHES: It's important. It's important to my family and all the families in America that he be reelected.

CROWLEY: Karen Hughes, now author, "Ten Minutes From Normal."

HUGHES: Author? Doesn't that sound funny?

CROWLEY: Yes. Now we're 20 minutes from normal. Thanks so much. We so much appreciate your coming by.

HUGHES: Thank you for having me.

CROWLEY: News from a current Democratic hopeful not named John Kerry just ahead. Dennis Kucinich is still plugging away. I'll ask him about John Kerry's all but certain nomination and why he, Dennis Kucinich, is still in the race

(COMMERCIAL BREAK)

CROWLEY: When it comes to politics, money is like water. It takes the path of least resistance. Campaign finance reform was supposed to stop the flow of unlimited, unregulated cash known as soft money. Republicans say it's simply flowing in a different direction.

Wednesday, the Bush campaign and the Republicans accused John Kerry's campaign of illegally coordinating political ads and get-out- the-vote activities with anti-Bush groups that are accepting soft money. The Kerry camp denies it, adding, "Bush and the Republicans have taken March madness and April foolishness to new levels."

Bruce Morton looks at what the fuss is all about.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: George Bush, he supported tax breaks for exporting jobs, and he raided Social Security to pay for a tax cut for millionaires. Bush's priorities won't strengthen America.

UNIDENTIFIED MALE: He ignored terrorism for months when maybe we could have done something to stop 9/11.

UNIDENTIFIED MALE: George Bush a failure of leadership.

BRUCE MORTON, CNN NATIONAL CORRESPONDENT (voice-over): They sound like campaign ads, but are they? And, under the McCain-Feingold campaign finance bill should they have to be paid for in hard money?

Well, the sponsors, Media Fund and MoveOn say no. They are what the tax code calls 527 organizations, and they're using soft money the way the political parties used to. Critics say that's illegal because 527s are exactly that, political.

UNIDENTIFIED MALE: It's important to understand the RNC is a 527. President Bush and Senator Kerry's campaign committees are 527s. It's a whole class of groups under the tax laws who have to meet the definition of your principal purpose is to influence campaigns.

MORTON: Harold Ickes, who runs The Media Fund, disagrees.

HAROLD ICKES, MEDIA FUND: The law is clear on its face. The Congress debated it. The Congress decided to sever the connection between soft money and federal officials and federal candidates.

But they left in place the existing law with respect to organizations such as The Media Fund, which permits citizens, average citizens, to come together and to express their political views and exercise their first amendment rights. That's what we're doing.

UNIDENTIFIED MALE: Which they're doing, but I would argue you not legally.

MORTON: The group has filed a complaint with the Federal Election Commission, but it is not an agency known for speedy decision making. And the Republican Party has now filed a lawsuit charging that the groups are part of an unprecedented criminal enterprise conspiring to circumvent the law and pour illegal money into the campaign.

It's complicated, but it matters. President Bush's campaign has raised far more money and spent far more on ads than Senator Kerry's. But if you add in the 527 organizations, the spending is fairly even.

Shutting them down would be a big boost for the Bush campaign. But the timing of any action by the courts or the FEC is hard to guess.

Bruce Morton, CNN, Washington.

(END VIDEOTAPE)

CROWLEY: We're going to hear more about 527s and how both campaigns feel about them in our exclusive interviews with the chairman of the Bush-Cheney campaign and the Kerry campaign coming up.

John Kerry, of course, has the Democratic nomination wrapped up, but Congressman Dennis Kucinich is still actively campaigning and still raising money. What's behind the Kucinich strategy? We want to find out with Congressman Kucinich, who joins me from Capitol Hill.

Thank you so much, Congressman.

REP. DENNIS KUCINICH (D-OH), PRESIDENTIAL CANDIDATE: Good to be here. Thank you.

CROWLEY: Let me ask you first about one of the uglier stories we've seen recently, and that is the Fallujah event, when we saw Americans burned in their cars, their bodies drugged down the streets, cheering Iraqis as they were hung from bridges. I wonder, even though you were opposed to this war -- and I understand that -- and you want us to get out, how does that sort of thing get replied to by the United States in either a military or a diplomatic way?

KUCINICH: Well, look, of course, it's heartbreaking to see it. And it points to the overall reason for, I believe, the United States to reach out to the U.N., get U.N. peacekeepers in. And we get to get our troops out of there.

I mean, we went in for all the wrong reasons. It was wrong to go in. It's wrong to stay in.

You know, the death toll of our troops is already approaching 600. I think this is a time for national discussion about a new direction. That's what I'm proposing. Bring in U.N. peacekeepers and bring our troops home.

CROWLEY: I understand that, Congressman Kucinich. I'm just wondering if that sort of atrocity, aimed directly at U.S. citizens -- these were civilians -- should go unresponded to.

KUCINICH: Well, you know, we're already present there. I mean, you can't invade Iraq again. We're already present there.

We don't need to escalate the violence. We have to find a way to de-escalate it. And so that's what I think would be served by taking a new approach, where we'd go to the U.N., give up control of the oil assets of Iraq, give up control of the contracts, ask the U.N. to handle those on an interim basis, ask the U.N. to help run the elections in Iraq, help handle the development of a new constitution, help stabilize Iraq with U.N. peacekeepers, bring our troops home. That's what I want to do.

CROWLEY: And let me turn you to some politics now. The Democratic Party is at a point where it very much wants to put on a unified front. There's been heavy pressure on Ralph Nader from all kinds of quarters not to stage a run.

What sort of pressure has there been on you to get out of this race? And what is the difference between you and Ralph Nader in terms of taking attention away to the man who seems to have the best chance between the two of you of winning the White House?

KUCINICH: Well, first of all, there's a big difference. Ralph Nader would be running as an Independent. I'm a Democrat. I'm running in the Democratic primaries.

And while I acknowledge that John Kerry has done a skillful job in gaining a majority of the delegates, and thereby on his way to the nomination, the direction of the Democratic Party has not been determined. And I'm in this race to have the Democratic Party make a strong stand for peace, for health care, for fair trade, for civil liberties, getting ready of the Patriot Act.

And it's my position in this race, which will demonstrate that the Democrats had the ability to track those people that would otherwise go for Ralph Nader. There's a home in the Democratic Party for people who would want to vote for Ralph Nader. And I'm the one who's keeping that door open for them.

CROWLEY: Congressman Dennis Kucinich, presidential contender Dennis Kucinich, still at it. Thank you so much for your time.

KUCINICH: Thank you.

CROWLEY: The furor over the Bush administration's pre-September 11 response to terrorism just won't go away. Coming up: the latest insight into what National Security Adviser Condoleezza Rice was thinking on the eve of the hijackings.

And later, another milestone for one of the U.S. Senate's most formidable figures.

(COMMERCIAL BREAK)

(BEGIN VIDEOTAPE)

ANNOUNCER: Unconventional security. Are officials going too far to protect the Democrats' summer party in Boston? UNIDENTIFIED FEMALE: And for people who have to get back to work and get back and forth, I think it's very wrong.

ANNOUNCER: Going negative. The debate over early attack ads gets ugly.

UNIDENTIFIED FEMALE: What we've seen from the Bush campaign has been right out of the box attack ads against John Kerry.

UNIDENTIFIED MALE: First of all, John Kerry started negative ads in September.

ANNOUNCER: There's more of our exclusive showdown between the Bush and Kerry campaign chairs. And a fact check of a campaign commercial fueling the fire.

(END VIDEOTAPE)

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

(END VIDEOTAPE)

CROWLEY: Welcome back. I'm Candy Crowley sitting in for Judy this week. The Bush White House is downplaying the latest revelation about its pre-9/11 response to the threat of terror. At issue a speech national security adviser Condoleezza Rice planned to give on the day of the attacks on America. This comes as the date has been set for Rice to appear before the 9/11 Commission. More now from our White House correspondent Suzanne Malveaux -- Suzanne.

SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Candy, Rice will appear before the full 9/11 Commission a week from today. On Thursday the 8th, she will testify for about 90 minutes we are told. This comes after tremendous pressure, as well as a White House reversal to allow her to testify publicly. And White House officials are anxious to get her to come forward to make the case this president took the threat of al Qaeda seriously. It also comes on a day, as well, when excerpts from a speech that she was to deliver on 9/11, that she did not deliver, have been leaked to the press.

That speech, it's a policy speech, it's a broad speech on national security, it emphasizes the need to coordinate efforts to protect the homeland against weapons of mass destruction, but it focuses primarily on missile defense systems. It does not talk about al Qaeda. It does not talk about Osama bin Laden. But the White House insisting today, on numerous occasions, this does not mean they did not take that threat seriously.

(BEGIN VIDEO CLIP)

SCOTT MCCLELLAN, WHITE HOUSE PRESS SECRETARY: This administration doesn't measure commitment based on one speech, or one conference call, or one meeting. We look at the sum total of the strong actions that we take.

(END VIDEO CLIP)

MCCLELLAN: White House spokesman Scott McClellan and others saying that just look at the first foreign policy initiative by this administration. It was to eliminate al Qaeda. There are critics, however, who say that this is rather consistent with other press briefings and speeches given by White House officials around the same time before 9/11 that were focusing on strengthening the missile defense system -- Candy.

CROWLEY: Suzanne, let me sort of turn your attention to the Fallujah pictures, this horrific attack on U.S. civilians yesterday. What is the White House saying about that? Do you get any sense of what their response might be, other than verbal?

MALVEAUX: Well, they're certainly keeping quiet about that. They're referring us to the Pentagon if there's going to be any kind of build-up of military forces there. We did learn today that the president actually saw some of those gruesome pictures yesterday, that he was quite disturbed by it. But we are also told that it has really bolstered the case here and their drive, their initiative to go after al Qaeda, to go after those who are causing these attacks, and also to stick with the Iraqi people before they turn over power.

(BEGIN VIDEO CLIP)

MCCLELLAN: We will not be deterred by these cowardly, hateful acts. These were despicable attacks. And this administration will continue working closely with the coalition, and the international community, and the Iraqi people, to help the Iraqi people realize a better future built on democracy and freedom.

(END VIDEO CLIP)

MALVEAUX: And Candy, as you know, this personally affects the White House. Looking at some of those very disturbing pictures but also politically as well. As you know the president is running on his record as a wartime president -- Candy.

CROWLEY: Thanks so much. CNN's Suzanne Malveaux at the White House. Appreciate it.

Now to security here in Washington. Officials are floating a proposal to build a fence around the U.S. Capitol to protect from possible suicide bomb attacks. U.S. Capitol Police Chief Terrance Gainer says the fence would have gateways for visitors to be screened for weapons. But then they would have free access. The idea is getting a cool response from many lawmakers, who don't want to be seen as isolated from their constituents. As D.C. Delegate Eleanor Holmes Norton put it, "we don't want to make it a fortress."

Now to security at the summer political conventions. The New York police commissioner says there are no plans to close Penn Station during the Republican convention at Madison Square Garden. But officials acknowledge no final decision has been made about a possible cutoff of train service on September 2, when President Bush accepts his party's nomination. Meantime, in Boston, many communities and companies are angsting about the newly announced decision to close North Station and Interstate 93 during the Democratic convention. CNN's Dan Lothian has more on the fallout.

(BEGIN VIDEOTAPE)

JANE KOOPMAN, DIRECTOR, MAID PRO MARKETING: ...Boston where we service about 300 clients.

DAN LOTHIAN, CNN CORRESPONDENT: At this maid service and software company in Boston security and traffic plans for the Democratic national convention are causing major headaches.

KOOPMAN: Well, we talk about shutting down for a week. We talk about all going on vacation. Hopefully on company time. But realistically, some of us are probably going to have to work from home.

LOTHIAN: Why? The convention's main venue is just out the window. The North Station train stop which feeds this area, and is under the Fleet Center, will be closed. And a key interstate, 93, just yards away, will be shut down during evening hours. Difficult for workers here to get in. Even harder for the cleaning staff to pick up supplies, and make house calls.

KOOPMAN: I guess Boston stays dirty.

LOTHIAN: Massachusetts General Hospital, where Senator John Kerry had shoulder surgery on Wednesday, will try to shift appointments to earlier hours and postpone elective procedures planned during the four-day DNC event. In all, 24,000 rail commuters will be displaced. Some of the 200,000 commuters who use I-93 will be inconvenienced.

STEVE RICCIARDI, U.S. SECRET SERVICE: Our goal is to provide a safe and secure environment for all event participants and the general public.

LOTHIAN: Over the past 15 months security has been the sole focus of a multiagency effort to prepare for the convention. And while the lives of hundreds of thousands of Boston area residents will be disrupted, some are banking on the business the event will bring in to help alleviate the pain.

(END VIDEOTAPE)

LOTHIAN: And some of those people would be the bars and some of the restaurants in the area. They're hoping that with all those delegates who will be coming to the convention that they will be able to make some money. But obviously the commuters who have to go in and out of that area are not pleased about the security plans -- Candy.

CROWLEY: CNN's, and a Boston resident Dan Lothian looking forward to a fun July. Thanks, Dan. They have had plenty to say about each other's candidates, and about their own campaigns. But in this election cycle, at least, they have never been on screen together until now. In their first joint appearance Kerry campaign chairwoman Jeanne Shaheen joined me from New Hampshire, and Bush campaign chairman Marc Racicot was in Washington. My first question concerned the RNC campaign finance complaint to the Federal Election Commission which may not be resolved until July. I asked Marc Racicot if there isn't a quicker way to do this.

(BEGIN VIDEOTAPE)

MARC RACICOT, BUSH CAMPAIGN MANAGER: There could be a number of different opportunities for earlier decision. That's precisely why we've asked the FEC to rule quickly, dismiss our complaint so that we can move it into court. Because the damage will be irreparable if it's not corrected without delay.

CROWLEY: Governor Shaheen, on the whole issue you've got Media Fund, which is operating with a group called Thunder Road, former Kerry campaign official, former Clinton people. Why should these not -- these groups not be under the auspices of campaign finance laws and have to use only money that's regulated?

JEANNE SHAHEEN, KERRY CAMPAIGN CHAIRWOMAN: Well, that was Congress' determination to make. I find it ironic that for a party that doesn't like frivolous lawsuits, what they've done is just run to the court with a frivolous lawsuit. The fact is, there is no connection between these groups and the Kerry campaign. But I think that what we're seeing here is an effort by the Republican party to avoid talking about the real issues in this campaign. The fact is, they don't want to talk about the number of jobs lost, the number of people without health insurance, a failed foreign policy. That's what John Kerry wants to talk about. In fact, Governor Racicot, since you and I are here today, I think it would be great if we could agree to accept the Kerry campaign challenge to debate so that people everywhere can hear the real issues in this campaign. We've said let's debate...

RACICOT: Two issues.

SHAHEEN: Six issues in six states. And that way people can really decide...

CROWLEY: Let me let Governor Racicot get in here.

RACICOT: Two responses, Jeanne. No. 1, the complaint that we filed, the complaint we filed alleges that the Kerry campaign and a number of independent organizations, 527 organizations are defiantly violating the law. It's a very serious allegation we make...

SHAHEEN: And it's just not true.

RACICOT: It's a very, very substantive issue, and we have what we believe to be overwhelming proof of that fact. You've got your former campaign manager who is guiding and directing one of these particular entities. In reference to the debate issue what I would suggest to you is that Senator Kerry ought to debate himself and come to a resolute conclusion about so many different issues before he challenges anybody else. It's hard to know where he stands on a given issue on a given day.

SHAHEEN: Well, you know that that's not the case, Governor...

RACICOT: Jeanne...

SHAHEEN: And the fact is that...

RACICOT: He's been in one...

SHAHEEN: The Bush campaign has put out a number of misleading attack ads, with misinformation, just as the suit alleges, and what we really need, you've said there's a real choice between these candidates. We believe there's a real choice between John Kerry and George Bush. So let's let the people decide...

RACICOT: Well, there will be debates. You know there will.

SHAHEEN: Let's debate the serious issues in this campaign. In six states...

RACICOT: You know there will be debates.

SHAHEEN: And see what people decide.

RACICOT: But they're already set. They're already set.

(CROSSTALK)

CROWLEY: Can I ask you, Governor Shaheen, if the shoe were on the other foot, Governor Racicot makes a point, look these are people that have prior relationships both with the Kerry campaign and the Clinton administration and they seem to exist according to how the Republicans see it, solely for the purpose of electing John Kerry, which would be to influence a federal campaign which would be in violation of the law. You say that that's not what these groups are about?

SHAHEEN: No. I'm saying there's no connection between the Kerry campaign and those groups. We're not working with them. They're working on their own. Just as so many groups on the Republican side are working on their own to support George Bush.

RACICOT: There is coordination.

SHAHEEN: And there is no coordination. No, I'm sorry, you're wrong, Marc. That is not true.

RACICOT: The rule of law...

SHAHEEN: This is another effort to attack John Kerry and to throw up a red herring. Because you don't want to talk about what's really facing this country. And about the failed policies of this administration. RACICOT: That's a delusion, Jeanne. The fact of the matter is this is a very, very substantive issue. It's very serious...

SHAHEEN: Oh, it is and it's totally incorrect.

RACICOT: Now, wait just a minute, Jeanne. Let me finish here. The fact is if you read the law, I would commend it to you, if you read the law, there are (UNINTELLIGIBLE) violations. In other words you can't have people like Jordan who are involved as your campaign manager, guiding and directing a 527, spending illegal soft money on behalf of a presidential campaign. That's what the law says. That's what you're doing. That's why we want it declared unlawful.

(END VIDEOTAPE)

CROWLEY: We'll have more of the clash of the chairmen coming up on INSIDE POLITICS.

Records were made to be broken but it may be a while before anyone equals a feat today in the U.S. Senate. That story is also coming up. And also ahead, Howard Kurtz puts the Bush campaign's latest attack ad in the spotlight looking for the facts behind the claims.

(COMMERCIAL BREAK)

CROWLEY: Months before the heat of the summer conventions, the Bush and Kerry camps are embroiled in attacks and counterattacks. I asked campaign chairs Marc Racicot and Jeanne Shaheen if they're worried that voters are going to tune out and be turned off. Here's more of our exclusive interview.

(BEGIN VIDEOTAPE)

SHAHEEN: I think people in this country want to hear what the candidates are proposing. Where they would take this country. John Kerry's been very clear. He thinks we need to turn this country around. We need to have somebody who's got a plan, who can create good jobs. This administration has lost 3 million jobs since George Bush has been president. We need somebody who's going to do something about health care. We've got 4 million more people without health care.

CROWLEY: But the question, I guess, is, can they hear any of those messages, Governor Shaheen, if so much of this seems to be awfully bitter back and forth negative things?

SHAHEEN: Well, you know, we would like to run a positive campaign. Again, that's why we've issued the debate challenge. Because we think it's important to talk about the issues facing this country. And what we've seen from the Bush campaign has been right out of the box attack ads against John Kerry. They've got another one running this week.

CROWLEY: Let me let Governor Racicot in on that. And on the negativity. Whether you worry that over a long, hot summer you're going to lose a lot of people's interest?

RACICOT: First of all John Kerry started negative ads in September, last September. And a majority of his ads were negative against the president, even though he wasn't running against the president at the time. We have talked about his agenda because it's not clear, that is Senator Kerry's agenda. He's for No Child Left Behind, then he's against it. He's for the Patriot Act, then he's against it. He's for the effort in Iraq, then he's against it or he doesn't fund the troops or provide them body armor so the fact of the matter is he doesn't have a clear agenda. The American people have a right to know and understand what these candidates are about. That's precisely why it is that we're focusing upon what it is that are his positions. If they were clear they'd be more easily understood.

CROWLEY: Governor Shaheen, let me move you on. I've got two last questions for each of you on slightly different subjects. We have seen since the end of the primary season in the USA/CNN/Gallup polls a drop of Senator Kerry from eight points up, to four points down. What do you think has happened that has caused basically a 12- point spread for Senator Kerry in those polls since the end of the primaries?

SHAHEEN: Well, I think there's going to be a long time from now until November. And we're going to see the polls show a lot of different things. But the fact is the Bush campaign has been attacking John Kerry since -- since before Super Tuesday with negative ads. They're sending about $6 million a week on that. And we think it's important wherever possible to correct the record, and to point out that Governor Racicot is just wrong when he says that John Kerry hasn't been clear in his positions...

CROWLEY: There has been some criticism of John Kerry that he hasn't been out there with a blueprint. That part of the problem is people aren't really sure what his vision of America for the next four years is. I take it you don't buy into that?

SHAHEEN: I don't. In fact last week he came out with his plan to create 10 million jobs in the next four years if he were elected. It starts with incentives to keep companies creating jobs at home. He would reduce taxes on those companies. And end the incentives that encourage them to create jobs abroad. What we've heard from the Bush administration is that they think outsourcing is a good thing for the economy. We totally disagree with that. We've got 1 million people who are going to lose their unemployment benefits today. We need to help those people. We need somebody with a plan to create good jobs. John Kerry is talking about that. He has a plan to do that.

CROWLEY: I know you're going to want to respond to something in there but let me just...

RACICOT: The most interesting number in your poll, Candy, is the one that says John Kerry will tell people what they want to hear. There was a substantial increase in the numbers where people indicated that they thought John Kerry was willing to assume any position that people wanted to hear about or that would gain them favor with him. That's what the American people are finding out about John Kerry. (CROSSTALK)

CROWLEY: Let me ask you about something in the poll, also about George Bush, which is, that when we asked seniors about the Medicare and prescription drug plan, the majority of them thought it would be bad for them. It was a negative for George Bush. And seniors. And seniors, in fact now favor John Kerry more than they do George Bush.

RACICOT: Well, John Kerry and the Democrats sat on their hands for a generation and did nothing about Medicare. This president had the courage to carry it forward. The Republican Congress carried it off. John Kerry wasn't there for a lot of the votes that took place on the Medicare discussion throughout the course of it finding its way through Congress.

Just a minute now, Jeanne. In the end, of course, voted against it. What they're going to find out is when 8 million senior citizens who are challenged economically have a new prescription drug card with a $600 credit, and when there's new prevention opportunities for them and new treatment options and new competition, you're going to find that the American public and those senior citizens across the country find great favor with the Medicare reform bill.

(END VIDEOTAPE)

CROWLEY: Well, it was just a matter of time probably before high gas prices landed in a campaign ad. Up next, Howard Kurtz checks the facts in a new Bush commercial and sorts through the competing claims between the two campaigns.

(COMMERCIAL BREAK)

CROWLEY: In the battle over gas prices the Kerry campaign is blasting President Bush for failing to stop OPEC leaders from cutting production. Democrats note Bush suggested in 2000 that his experience in the energy industry would help him influence the oil cartel. The Bush camp contends gas prices would be even higher if Kerry were president. Howard Kurtz of CNN's "Reliable Sources" has been analyzing the latest Bush campaign ad attack on Kerry's record.

(BEGIN VIDEOTAPE)

AD ANNOUNCER: Maybe John Kerry just doesn't understand...

HOWARD KURTZ, CNN CORRESPONDENT: As attack ads go the latest Bush assault is kind of funny.

AD ANNOUNCER: Some people have wacky ideas, like taxing gasoline more so people drive less. That's John Kerry.

KURTZ: But it's no laughing matter to the senator's campaign which has been getting hammered on taxes by the president's advertising blitz.

AD ANNOUNCER: Kerry's plan will raise taxes by at least $900 billion his first 100 days in office. KURTZ: And the new spot contains a misrepresentation that's no joke.

AD ANNOUNCER: He supported a 50 cent a gallon gas tax. If Kerry's gas tax increase were law the average family would pay $657 more a year.

KURTZ: Hold on. The "Boston Globe" quoted Kerry in 1994, that's ten years ago, saying a 50 cent gas levy would be a good idea for cutting the budget deficit. But there was never any vote and Kerry soon changed his mind. The Bush ad makes it sound like Kerry wants to raise gas taxes today. Which isn't the case. What about this claim?

AD ANNOUNCER: Raising taxes is a habit of Kerry's. He supported higher gasoline taxes 11 times.

KURTZ: Kerry did vote for a four cent gas tax increase as part of President Clinton's deficit reduction package in 1993. And voted several times against repealing that. Here's what's not in the ad.

BUSH: The short-term solution on the -- is to get the price of crude oil down.

KURTZ: The president promised four years ago to cut gasoline taxes. But he hasn't even made a proposal. Instead Bush pushed an energy bill to boost production by drilling in the Alaska Wildlife Refuge, which Kerry opposed and which the Republican Congress rejected. The Bush ad team has done a skillful job of stealing Kerry's thunder. But in this case, Kerry struck first. The Democratic candidate was scheduled to unveil his plan for lowering gas prices in a California speech Tuesday. When Kerry strategists learned Monday afternoon about the coming tax ad they leaked the speech to the "Washington Post," "New York Times," "Boston Globe," and the "AP," among others, so the stories appeared Tuesday morning just as Bush's gas attack was hitting the airwaves. By then Kerry was trying to seize the offensive.

SEN. JOHN KERRY (D), PRESIDENTIAL CANDIDATE: The Bush administration's launched a new set of attack advertisements. This administration has done nothing with OPEC to reduce the gas prices.

KURTZ: With gas prices surging, both sides are trying to pump up their case on energy costs. But the high octane Bush campaign seems to be clicking according to polls, driving up Kerry's negatives in the 17 battleground states where these ads have been airing. The Kerry team, lacking the same financial fuel, has responded on the airwaves only once. This is Howard Kurtz of CNN's "Reliable Sources."

(END VIDEOTAPE)

CROWLEY: What's a fellow got to do to get a standing ovation in Congress? The answer and the picture ahead on INSIDE POLITICS.

(COMMERCIAL BREAK)

CROWLEY: Senator Robert Byrd of West Virginia is in his sixth decade on Capitol Hill. Closing in on his first half century as a U.S. senator. Today, Byrd cast his 17,000th vote. Hard to say, much less do. He already holds the record for the most votes cast. This one is just a nice, round number. It sparked a rare moment of bipartisanship. Both Majority Leader Bill Frist and Minority Leader Tom Daschle congratulated Senator Byrd. The vote, by the way, was the procedural motion on a welfare bill.

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

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