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CNN LARRY KING LIVE

Coverage of Republican National Convention

Aired August 31, 2004 - 21:00   ET

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


LARRY KING, HOST: Night two of day two of the Republican National Convention, Madison Square Garden in New York. I'm Larry King and this is edition number one of LARRY KING LIVE. We'll have another one at midnight Eastern Time. During this hour we'll be talking with Elizabeth Dole. Her husband's right here. We'll also be talking with Mayor Rudy Giuliani and with Karen Hughes.
Joining us in Washington is Bob Woodward of "The Washington Post." His book, by the way, "Plan Of Attack" remains a major bestseller.

Here in Madison Square Garden is Bob Dole. He's actually here, folks. He's not in Washington. He's with us tonight. He came here to watch his wife speak.

George Mitchell, the former Senate majority leader is aboard.

On the floor is Jacque Reid, the anchor of "BET Nightly News." What was it like, Senator Dole, to watch Elizabeth on the floor tonight?

ROBERT DOLE (R), FMR. PRESIDENTIAL CANDIDATE: I thought she did a great job. I was seated with President Bush 41, and, you know, she's always very well. She's disciplined. She stays on her message. Did a great job.

KING: You get nervous for her?

R. DOLE: A little bit. But you know, she's a pro. So if I were up there I'd be nervous. But when she was up there I wasn't nervous.

KING: Bob Woodward, are they staying on message here?

BOB WOODWARD, "WASHINGTON POST": Well, they certainly are. Not only that, Bush's positives, he's the incumbent and they're exploiting that very well. And they're also developing continuously this toughness message. And it's quite remarkable, also, on the potential negatives for President Bush, they are framing the issues in a way that make them much more positive. Obviously the war in Iraq, and how it continues, and its difficulties, are a potential giant negative. But the framing has been, well, President Bush makes the tough decisions, the hard choices. He, of course, and others believe it's the right decision. But there is this sense of, well it hasn't worked perfectly now, but it's going to in the future. To a certain extent it's foreign policy on speculation. But a lot of people are buying it. And it is, in many ways, is a matter of stage craft of brilliant first couple of days.

KING: George Mitchell, tonight they're selling compassion. Is that going to work?

R. DOLE: Selling? I don't...

GEORGE MITCHELL (D), FMR. SENATE MAJORITY LEADER: Well, it worked in 2000. It will be a little more difficult to work this year because you've had the record of the intervening years. But I agree with Bob Woodward. The emphasis is on 9/11, security, the war on terror, strength during a time of conflict. That's the emphasis today. Just as Boston gave the Democrats a chance to get their message out for four nights, so, here in New York, it's four nights with Republicans having the chance to get their message out.

KING: Is the key tonight, Jacque Reid, Governor Schwarzenegger?

JACQUE REID, "BET NIGHTLY NEWS": Yes, it is, Larry. That is definitely what most people here are looking forward to hearing from. Look over here if you can. I'm in or next to the delegation from Kentucky. And everyone has on shirts that says "I'm with Arnold." They are excited about the governator coming here tonight to talk about compassionate conservatism. Now we hear when he comes up to the mic that he is going to talk about his history, his past, coming to this country from Austria and finding that American dream, you know, finding success in Hollywood, and as a businessman. And marrying into one of the most popular families in this nation. Becoming part of Camelot. So, everyone is looking forward to hearing his story and hearing what he has to say in support of President Bush.

KING: It's a great all-American story, Bob Dole, in that Maria Shriver was present at the Democratic convention in Boston. She's not here with her husband tonight. How do you explain, as a Republican, a veteran of the wars, the Schwarzenegger phenomenon?

R. DOLE: Well, I think he was new. He was a fresh face. He had this persona, people liked him whether you're Democrat, Republican, Independent. He didn't offend people. And I think he demonstrated that he also had the capacity, had the potential. He was a pretty bright guy. And he may have been underestimated early on. But I think now he's proven to be a good governor and has a lot of support across the board. Democrats, Republicans, and Independents.

KING: Bob Woodward, is he an important figure in the party? He can't be president.

WOODWARD: That's right. And it's quite unlikely that Bush will win California. But I think one of the messages he's going to send tonight is that the Republican party is open to immigrants and make that very, very strong case. I also am watching some of the recent polling. The "Washington Post"/ABC poll suggests maybe there's more voter uncertainty and volatility. Everyone was saying, well, the undecided voters seem very few. I noticed on the issue of who might be strongest in fighting the war on terror in the last month, President Bush has gone up 15 points on that issue. So I think there are a lot of sales still to be made in the campaign. That it's not over. And that the pool of persuadable voters might be much bigger than thought initially.

KING: How do you explain that, Senator Mitchell, assuming everything Bob said is true and there's no reason to doubt it. Why do we have a large disparity in terrorism, a large disparity here and a close race?

MITCHELL: Well, because there are other disparities that cut in Kerry's favor, health care, education...

KING: So you have people walking around not knowing what to do?

MITCHELL: Different people have different subjects that they're most concerned about. Let me just say on Schwarzenegger, Larry, America is a nation of immigrants. It remains a powerful and compelling story that someone comes here with nothing, can't even speak English, and rises to the pinnacle of success. For a long time in history, Republicans were not seen as open to immigrants. They flocked to the Democratic party. That's changed now. Republicans are making a determined effort to appeal to immigrants on the issues that are relevant to their concerns. And you see the effort with Hispanics, who are, of course, now increasing dramatically in numbers. And I think Schwarzenegger will have a very persuasive message tonight as an immigrant who has succeeded. It strikes a chord with all Americans.

KING: Franklin Roosevelt's famous, "my fellow immigrants" speech. We're going to take a break and son of immigrants will join us, Mayor Rudy Giuliani who sparked this crowd last night. The entire panel will participate with the mayor. We'll be right back.

(COMMERCIAL BREAK)

KING: The big story of night one was Mayor Rudy Giuliani, the former mayor of New York. Someone called him last night, I think it was George Mitchell, America's mayor. Rudy Giuliani joins us here in his home city of New York. We have some news, Rudy comes on and tells us that Mr. Martinez is leading in Florida for the Republican Senate nomination.

RUDY GIULIANI, FORMER MAYOR, NEW YORK CITY: Right. I think it's about 60 percent of the vote that has been counted, and he's leading by somewhere between 6 and 8 percent.

KING: Is he the better candidate, in your opinion?

GIULIANI: Well, I endorsed him and raised money for him. So.

KING: I gather then...

GIULIANI: I think he is.

KING: We'll have the whole panel participate with you, Mayor. By the way, the mayor will be back with us on the night of 9/11 when we look back three years. And we thank you very much for agreeing to be with us.

GIULIANI: Thank you, Larry. Thank you for doing it.

KING: Most people are saying here tonight, did he really mean it when he said the first thing he said was, thank God George Bush is president, since he'd only been president eight months?

GIULIANI: Yeah, I did. I said it to Bernie Kerik. I grabbed his arm and I said it to him.

KING: Had you said that before?

GIULIANI: Oh, sure, yeah. Oh, you mean, had it been recorded before?

KING: Yeah.

GIULIANI: Oh, gosh, yeah. Probably August in 2002, it was in one of the newspapers in Florida.

KING: Can you remember what made you think of it?

GIULIANI: It's been reported in the newspapers maybe about a dozen times or more. And it's been on television. I maybe even said it on your show.

KING: You didn't say it -- but, remember what led you to say it?

GIULIANI: Yeah. What led me to say it was, my feeling that I had just talked to the White House. I had asked for air support for the city. And I felt, because of my conversations with George Bush, that he would have the kind of character to stick to this. That he wouldn't do some symbolic bombings and run out and walk out. That he would understand what we had been doing wrong about terrorism for about 30 years. And that he would have the kind of determination to stick to it.

And I grabbed Bernie's arm and I said to him, "thank God George Bush is our president."

It wasn't the first thing I said. Bernie and I had had, you know, a thousand words, talking about what we were covering, or -- it happened to be a thought that came into my head and I said it to Bernie. And I've repeated this story many times, so has Bernie.

KING: Our other panel members will join us. One other thing from me. Many Democrats today said you were a little rough on Kerry.

GIULIANI: Oh.

KING: You don't think you were?

GIULIANI: I thought I was kind and funny, and humorous. And I said at the beginning that I respect his service to America, and people here, Republican delegates applauded for him. Which I thought was wonderful. I thought it was -- but we have to be able to conduct a campaign here. We're not supposed to touch his record in Vietnam. I'm willing to say, fine. We'll stay away from that. But we're sure as heck going to touch his record in the Senate. I mean, it is a record of inconsistency. Significantly more than most Democratic or Republican senators.

R. DOLE: I think it's the way it was said, too.

GIULIANI: It was a fair point.

R. DOLE: The way you said it, I mean, you smiled. You had a smile on your face. You weren't, you know, like this. And that makes a difference.

GIULIANI: If I -- if I -- I'm in favor of capital punishment. Ex-prosecutor, I've been in favor of capital punishment. If I were to change my position, and now be against capital...

KING: Well, you're allowed. You can change.

GIULIANI: I could change it, but I have to expect it would be an issue that would be raised.

KING: And you could explain why you changed it.

GIULIANI: And if I change my position back again, if I was in favor of capital punishment, then against it, and now I was in favor of it again, I would expect that my opponents would say, maybe this guy has a problem with consistency. John Kerry in this campaign has been pro-war, he's been the anti-war candidate, and now he's pro-war again. It's a fair point for us to raise.

KING: And you can agree or disagree with it, right? Because you can logically change.

GIULIANI: Of course you can. But then you can also say if you do it too much, it might show a tendency to be inconsistent.

KING: Let's bring our other folks in. Bob Woodward, you have a thought or a question for the mayor?

WOODWARD: I do. Mayor, as an old prosecutor, you know you have to be skeptical. You have to -- you live like journalists, like myself, we live in a sea of doubt. We're always skeptical. And President Bush repeatedly has said publicly, and in interviews, that he has no doubt about the decisions that he has made. Have you found that to be the case? And how do you explain it? Because most people always have doubts about their decisions.

KING: Good question.

GIULIANI: Well, you have doubts about some decisions and you don't have doubts about others. If you're asking me about myself, there are decisions that I made as a mayor or as United States attorney that I was very sure of. And even when people disagreed with it, I continued to be sure of it. There are other decisions that I made that I had doubts about, and I would have to change them or admit I was wrong. So I don't think...

WOODWARD: But during the response -- during the response to 9/11, which you witnessed firsthand in many moments, did you see the president? Did he turn to you and say, you know, I'm not sure what to do here, or what's your advice? Was there any expression of doubt on his part?

GIULIANI: No, there wasn't. In fact, he was very supportive and very strong. The first time I saw him after September 11, was when he came on Air Force One -- to an Air Force base in New Jersey, and Governor Pataki and I greeted him. He came off the airplane, and it was very emotional. We had talked on the phone two or three times, but we hadn't seen each other. And he put his arm around me and he sort of grabbed the back of my head and he said to me, "what can I do for you?" And that was -- I mean, that was -- he was very supportive of me, and of Governor Pataki. I never detected any doubt or indecision, or...

KING: Senator Mitchell?

MITCHELL: Rudy, in the run-up to this campaign, both campaigns have identified about 18 to 20 states as battleground states they're concentrating their efforts there. New York and California are not among them. In 2000, before the election, the Bush campaign effectively ceded those states. What are you telling the president? Should they try to compete in New York? Does he have a chance to carry it? Or should they concentrate in Ohio and Michigan and Florida?

KING: Lay it all out there.

GIULIANI: I mean, Ronald Reagan is the last Republican presidential candidate that carried New York. So it's possible to carry New York. We have a Republican governor, a Republican mayor. Now, two in a row. Mike Bloomberg succeeded me. But this is still going to be a tough state. So maybe if the president gets a lead, and you start seeing -- like Pennsylvania now is very close. You start seeing New Jersey get close, then maybe you can start thinking about New York as a battleground state. But right now I'd have to say, you know, just to be honest, it isn't. Any more than Texas is.

R. DOLE: But if somebody gets a break in this campaign, it could be Kerry, it could be Bush, all bets are off. I mean, one day can change the whole momentum, it can change the outcome of the campaign.

KING: It could happen in the last week.

(CROSSTALK)

R. DOLE: ... something happens overseas. I mean, it can have a big, big impact. Something might happen here. But I can -- I think Kansas is looking pretty good for Bush. GIULIANI: And I have a feeling -- but this is just a feeling, that I can't prove -- I have a feeling that it's going to be a bigger victory than expected. And I believe it will be for President Bush. But, you know, I think somebody could break away here.

KING: Oh, really?

GIULIANI: I think so.

KING: Jacque Reid, one more thing on the floor. Do you have a question for the mayor?

REID: I definitely do. I was going to say that if anybody had a blueprint for winning over voters who had a strong dislike for you, it is Rudy Giuliani. Pre-9/11, Mr. Mayor, you know, these voters here in New York City were not too favorable of you. But, then after 9/11, after September 11, they fell in love with you.

KING: What's the question?

REID: What advice would you give to President Bush to win over those voters who don't really like him?

GIULIANI: I mean, every time I ran, I had to win over voters who largely didn't agree with me, since I was running in a city that was five to one Democratic. So I tried very hard to appeal to them on not being a Republican, you know, being a mayor. I used to use -- I used to use La Guardia's line, "there's no Democratic or Republican way to pick up the garbage." There's only the right way to do it. But that's a little bit easier for a mayor than a president.

KING: What about the Red Sox?

R. DOLE: Well, they're behind. Aren't they?

KING: Mitchell's Red Sox.

MITCHELL: Don't get mad.

GIULIANI: Before I came out here, the Yankees were losing 9-0.

MITCHELL: And the Red Sox are winning 6-0.

GIULIANI: That's the first thing he told me. I think it was some kind of an attempt to play with my head.

MITCHELL: Larry, during the playoffs, I took him to Fenway Park, and we had to wear a mask and a cap.

KING: See you on 9/11. Thank you.

GIULIANI: Take care.

KING: We'll be right back with Elizabeth Dole. Sitting next to her husband. Don't go away.

(COMMERCIAL BREAK)

KING: Together on the same platform, here on LARRY KING LIVE, edition number one. Senator from -- the junior senator from North Carolina, Elizabeth Dole.

SEN. ELIZABETH DOLE (R), NORTH CAROLINA: Good to be with you.

KING: What's it like to sit next to the former senator?

E. DOLE: I'll be so glad to see this guy.

KING: You two cross in the night don't you?

E. DOLE: It's been kind of like ships passing in the night, right.

B. DOLE: I'm sort of the moderate here. I'm the middle, you're the left, and the right, and the moderate.

KING: What was it like speaking up there?

E. DOLE: You know, at the last -- well back in '96, when Bob was the nominee, I went down and walked around the audience. I think that's my preference, Larry. Because the podium becomes a barrier between you and the people. You know, I like to get up close.

KING: Vice President Cheney is arriving. He gets here early. Was here early last night.

How does this -- how does North Carolina look?

E. DOLE: North Carolina will definitely go for Bush in my view. No question. He carried North Carolina about 13 points last time. And I think they'll be right in his column.

KING: Senator Edwards will not make a difference?

E. DOLE: I don't really think so. I mean, you know, having him on the ticket means some of the issues that we care about maybe are being discussed, that's great. But people vote for the top of the ticket. And North Carolinians share the president's values. They certainly share his concerns about tax relief and making it permanent. And also his strong leadership in the war against terror and having the resources to move forward. They're in his column in my view.

KING: How do you like elective office?

E. DOLE: I'm enjoying it. I really am. It's a mission field, really. It's opportunity to make a difference. Hunger is my top priority in the United States today. We had a wonderful event today that helps people who are dealing with hunger in New York City.

KING: But you ran the Red Cross.

E. DOLE: Yes.

KING: That's administrative. Now you're one of 100.

E. DOLE: Right.

KING: What's it like legislatively versus administrative?

E. DOLE: Well, it's really a different world. You have a little more control over your schedule when you're a head of a cabinet department. You still have to stay through the office of management and budget, you still have to convince the Congress, but you're more in control of your day-to-day life.

B. DOLE: If you're a leader like George Mitchell, and then you have control of all the others.

KING: You two guys ran the Senate.

E. DOLE: That's right.

B. DOLE: Yes, it's like herding cats, Howard Baker said.

MITCHELL: Pushing spaghetti uphill.

KING: What's it like being married to a senator, senator?

B. DOLE: Well, it's nice. I don't have to work. You know, I think it works out great. And she has a good voting record.

KING: You like her.

B. DOLE: Yes.

KING: Bob Woodward -- Bob Woodward in Washington, do you have a question or a comment for Lady Dole?

WOODWARD: Yes, for Senator Dole -- Senator Dole, you served with Senator Kerry in the Senate for some time now, and it's a small group you get to know somebody, even somebody across the aisle. What's he like as a senator?

E. DOLE: Bob, I'm going to have to be honest and candid with you. He has been running most of the time that I've been serving in the United States Senate. And I've not really had an opportunity to have a lot of personal relationship with John Kerry.

KING: Do you serve on any committees with him?

E. DOLE: No, I don't.

KING: OK. On the floor is our lady Jacque Reid.

Do you have a question for Senator Dole, Jacque?

Jacque, are you there?

We've lost Jacque.

Senator Mitchell, do you have a question?

MITCHELL: A hard one. I'll ask her a hard one.

KING: Don't be rough on her.

MITCHELL: No, I won't. I was never rough on him, how could I be rough on her?

E. DOLE: We're friends.

MITCHELL: That's true. That's true. But seriously, you mentioned the presidential race in North Carolina. There's also an important Senate race.

Is that likely to be closer than the presidential race?

E. DOLE: That will be a close race. Erskine Bowles, of course, was my opponent. And he's been around that track once. He also -- he put $7 million into the race with me of his own money. Now, he has the potential to do that again. But Richard Burr is working very hard. He raised a lot of money. He started very early. He's a very knowledgeable, thoughtful person. Very highly respected in the Congress. And I think that Richard Burr will win. I think it will be a close race. We've got to work hard.

KING: You will campaign, both of you?

E. DOLE: Yes.

KING: For him. You campaign, too?

B. DOLE: Well, yes. I think a lot depends on how President Bush runs in North Carolina, too. If President Bush is strong, that's a big -- but I think Elizabeth's going to be a factor in North Carolina, too.

E. DOLE: I'm sharing his campaign in North Carolina.

KING: Before Elizabeth leaves us we all want to extend our best to Howard Baker. The U.S. Ambassador to Japan, a good friend of this show, he underwent open heart surgery yesterday in Tennessee. The prognosis is good. He's expected to go home the end of the week. And possibly return to the American embassy in Japan in October.

Nancy Kassenbaum, a former senator is his wife. We all extend our best to Howard Baker.

E. DOLE: Absolutely, we certainly do.

KING: We'll be back with Karen Hughes at the Republican National Convention.

Thanks, Elizabeth.

Don't go away.

(COMMERCIAL BREAK)

KING: Bob Woodward is with us in Washington. Bob Dole and George Mitchell are with us here. And joining us now, an old friend, Karen Hughes, special adviser to the Bush campaign. Key adviser and confidant of the president. Was counsel to him for the first 18 months in the White House. Are you glad to be back in the wars?

KAREN HUGHES, SPECIAL ADVISER TO BUSH CAMPAIGN: Is that my new title? I'm glad to know. Because somebody asked me the other day, and I was completely stumped. I didn't know what they called me now.

KING: (UNINTELLIGIBLE) you're a special adviser.

HUGHES: Well, I'm glad I'm special. That's great.

KING: You like being back?

HUGHES: I love being back. It's really a lot of fun. It's, you know, it was wonderful to be home in Texas. My family's there now. They're happy. If I had a magic wand, I would wave it and this campaign would be a year from now after my son had gone to college. But I don't have that. And this election is important. It's important for my family and it's important for all our families. So I'm very glad to be back.

KING: What does a special adviser do?

HUGHES: Well, I'm learning. I went back -- I'm traveling with the president. When I left the White House, I promised the president that I would travel with him full-time for the last few months of his election campaign. This is my fourth campaign with him now, Larry. I've been on the road with him. My specialty is the area of communications. And so I try to help him work on his message and make sure that he is able to convey the policies that he wants to convey in the way that he wants to do so.

KING: So you'll be with him the rest of the way?

HUGHES: I'll be with him the rest of the way. A few interruptions. I never miss a wedding anniversary at home. So I go home for my wedding anniversary. But other than that, I'll be with him pretty much full-time on the road.

KING: Are you going to work with him on his speech?

HUGHES: I've been working with him on his speech. It's -- I think it's...

KING: Give us a little advance.

HUGHES: Well, I think it's an excellent speech. And it really is a speech that talks about what he believes, and where he stands, and where he wants to lead the country for the next four years. It's very forward-looking. It talks about his plan to build this economy, to give workers the skills they need in this changing world. It's, you know, in many ways our world is changing dramatically. The way we live and work, Larry, in our parents' generation, our fathers went to work for one company. They stayed there for most of their lives, and the company took care of the pension and the health care. That doesn't happen anymore. I've had seven or eight different jobs in my life. I've never vested in a single retirement plan anywhere I've ever worked. And that's becoming increasingly the norm for people.

And so the president will talk about how his domestic policies seek to give people the training and the skills that they need, and the education that they need to succeed in this changing world. And then, of course, he'll talk about our national security environment and what it will take to wage and win the war against terror.

KING: Will he discuss his opponent?

HUGHES: He will -- he'll point out, in I think a very pleasant way, some contrasts between his positions and those of Senator Kerry. There's a huge philosophical difference in this election. George Bush is a compassionate conservative. President Bush is -- that is his philosophy. That has consistently been his philosophy. Senator Kerry has a voting record that makes him one of the most liberal members of the United States Senate, on issue after issue, from education to health care, where Senator Kerry wants a big government-driven plan, where -- and the president wants a plan that allows people to make their own choices and helps those who can't afford it make health care more accessible. In issue after issue, there's just a vast, philosophical difference.

KING: Why is it so close?

HUGHES: I think the country is closely divided. As we saw, none of us will ever forget those 36 days of that Florida recount. The country is a divided country. We're very -- we're very closely divided between Republicans and Democrats. Karl Rove tells me that the number of people in the middle is shrinking. That it used to be 10 or 15 years ago, that about 15 percent of the voters were truly undecided or truly swing voters in a presidential race. That number is now down to about 6 percent of the voters. So you have both -- we have people who normally vote Republican, people who normally vote Democrat, and a very small group of people in the middle.

KING: What will Laura -- sorry, I can't hear.

HUGHES: It is very hard to hear. It's noisy here on the floor, isn't it?

KING: Do you know what Laura will speak about tonight?

HUGHES: I do. I worked with the first lady on her speech, and she will give us a very personal look, I think, at what it's been like. She will talk about her personal insights as she watched the president make these profound decisions for our country.

And you know, there's no harder decision for a president than to commit the lives of young Americans to war. And she will talk about watching him make those decisions, and what it was like on a personal level.

She is the first lady. She is also a mom. And like me, I think that the number one issue in her mind, when she goes to vote and when I go to vote, is who is going to make this world safer for our children in the future. And she will talk about that issue tonight.

KING: Bob Woodward in Washington, you have a question for Karen Hughes?

WOODWARD: Yes, Karen, as you look at the election now, the issues obviously are the economy, and then the foreign affairs issues, Iraq, and the war on terror, and as things go on, one tends to be dominant. Where do you think that's going?

HUGHES: Well, Bob, I think there really are always -- the economy is always an issue in the presidential election. And I think clearly, the economic damage from September 11 hurt our economy for a long time. And it caused us to lose a lot of jobs. As you know, President Bush took office as we were entering a recession. We believe that his tax relief that he passed twice was the right prescription. It helped fuel consumer spending, that really helped give the economy a boost at a very, very critical time. Particularly after September 11, when it was precarious.

The economy is now showing steady growth. The unemployment rate is 5.5 percent, which is lower than the average of the 1970s, the 1980s and the 1990s. I've been saying for some time that I think the economy is actually a little better than people's perception of the economy...

KING: Obviously, then why isn't he ahead?

HUGHES: Well, so I think the economy -- I was going to say, I think the economy is one issue.

The second big issue, though, and the issue that I personally believe will be ultimately the deciding issue is the war against terror. Because I just believe when people go to vote this fall, they are going to walk into that voting booth and say who is able to keep my family safer? And I believe they're going to conclude that it's President Bush. He is being -- he is taking the war to the enemy. He is promoting freedom, which ultimately makes our country safer.

Senator Kerry says that he's not even sure the war against terror is a war at all. He called it primarily an intelligence and law enforcement operation. And he's certainly entitled to that view. But I think it's very dangerous thinking, Larry. Because that's exactly the way we approached it in the 1990s, while al Qaeda was plotting and planning the attacks of September 11.

KING: Are you including Iraq in the war on terror?

HUGHES: I am including Iraq, because I think it is the central front in the war against terror. September 11, you know, it's interesting. The September 11th Commission said that the U.S. government was guilty of a failure of imagination before September 11, that we could not imagine that horror. After September 11, we cannot fail to imagine that the terrorists will do everything in their power to try to get weapons of mass destruction. And you have to look at people that we knew had the capability of making them, like Saddam Hussein.

KING: But they weren't there.

HUGHES: But he had -- they found that he had the capability, Larry, of making them. We thought they were there. And you're right, they apparently so far we have not found any. But we did find that he had the capability of producing them, and that's a very dangerous capability in the world after September 11.

KING: Thank you, Karen. We're going to have a special speech now by Maryland's lieutenant governor, Michael Steele. He's expected to talk about civil rights and to share his personal story of humble beginnings and work and success. He's the first African-American elected to statewide office in Maryland's 350-year history. He's vice chair of the Maryland Bush/Cheney '04 leadership team and a member of the African-Americans for Bush National Steering Committee. Taking the podium will be Lieutenant Governor Michael Steele, at the podium coming up now, we're told.

UNIDENTIFIED MALE: Underpriveleged and underresourced school, so that we can close the achievement gap here in America, and get our students to make significant gains.

UNIDENTIFIED FEMALE: You and I have talked a couple of times over the last couple of days, and you mentioned an interest in being...

KING: Well, apparently Lieutenant Governor Steele is not speaking as I was told he was. He's here to represent minority Americans. Karen?

HUGHES: Yes, that's my understanding. Tonight, we're talking about the compassion of America. And we're talking about issues like education, and the faith-based initiative. And you know, the decency of Americans all over our country. Governor Schwarzenegger tonight will be celebrating the great spirit of America. He's an immigrant. He'll talk about achieving the American dream, and about he's going to talk, it's a very eloquent speech, actually a very inspiring speech.

Laura Bush will talk about the ideals of our country and how long it took -- how we are still working to perfect our own democracy here in America. I think when we look at Iraq and Afghanistan, and we think it's taking a long time, we perhaps should remember how long it took in our own country.

KING: Now we understand Lieutenant Governor Steele will speak. Here's Lieutenant Governor Michael Steele. Thanks, Karen.

HUGHES: Thank you, Larry.

MICHAEL STEELE, LT. GOV., MARYLAND: Good evening. Is this a great party or what?

(APPLAUSE)

Now, I had planned to give a moving defense of the conservative principles of the Republican Party tonight. But there was one problem: Barak Obama gave it last month at the Democratic Convention.

(APPLAUSE)

I am the first African-American ever elected to a statewide office in the great state of Maryland.

(APPLAUSE)

Even more amazingly, on a ticket with Governor Bob Ehrlich of the great state of Maryland, the first Republican governor in Maryland in over 40 years, I became the first Republican lieutenant governor of my state.

(APPLAUSE)

Together, Governor Ehrlich and I made history.

I am proof that the blessings of liberty are within reach of every American. We have come an incredibly long way since the first Republican president, Abraham Lincoln, signed the Emancipation Proclamation.

And we have come a long way since another Republican president, Dwight Eisenhower, sent the National Guard into Little Rock to open the school doors to black and white children alike.

(APPLAUSE)

And we have come even further since a majority of Republicans in the United States Senate fought off the segregationist Democrats to pass the Civil Rights Act of 1964.

(APPLAUSE)

My journey to this moment has been inspired by men and women who remained forever vigilant in their pursuit of equality and opportunity. Individuals like Frederick Douglass, Martin Luther King, Ronald Reagan and Maebell Turner refused to accept the poisonous path of complacency. They each had dreams. But more important, they all had plans to turn those dreams into an American reality. America, ladies and gentlemen, is the promise of endless possibilities.

America, my friends, remains that place Ronald Reagan called "a shining city on a hill."

(APPLAUSE)

But while the promise of America is real, the challenges we face to secure that promise for every American are no less real. We must continue to be vigilant in our fight against the blight of poverty, poor education and lost opportunity. What truly defines the civil rights challenge today isn't whether you can get a seat at the lunch counter, it's whether you can own that lunch counter to create legacy wealth for your children.

(APPLAUSE)

Now, at the Democratic convention, we heard one word over and over again: hope. But there's a problem, my friends. Hope is not a strategy. Hope doesn't protect your kids from terrorism. Hope doesn't lower your taxes. Hope doesn't help you buy a home. And hope doesn't ensure quality education for your children.

As the book of James reminds us: "It's not enough just to have faith. Faith that does not show itself by good deeds is no faith at all."

(APPLAUSE)

You see, it's results that matter; and President Bush doesn't just talk about hope, he stands on a record of putting hope into action for America.

(APPLAUSE)

President Bush knows that a competitive marketplace will require providing our children with a first-rate education.

He knows that too many of our children are headed for the state pen instead of Penn State.

(APPLAUSE)

He knows that the "soft bigotry of low expectations" is today's version of blocking the entrance to the schoolhouse door.

President Bush didn't just hope for dramatic education reform, he turned that hope into No Child Left Behind, and our children are learning again.

(APPLAUSE)

He didn't just hope for economic recovery, he turned that hope into action by returning money to the people who earned it -- American families.

And today, over 111 million taxpayers are keeping more of their own money.

President Bush didn't just hope for increased home ownership in America, he put his hope into action.

And today, more Americans own homes than ever before and for the first time ever, more than half of all minority families in America are home owners.

(APPLAUSE)

Now, I am, like many of you, a 20th century parent trying to raise 21st century kids. And I realize that my responsibility for them doesn't end when I bundle them up, kiss them on the forehead and send them off into the world. If we expect to succeed, if we expect our children to succeed, we must look to ourselves and not to government to raise our kids, start our businesses and provide care to our aging parent.

(APPLAUSE)

What government can do is give us the tools we need and then get out of the way and let us put our hopes into action.

(APPLAUSE)

But this requires strong leadership. Now, Senator Kerry's leadership is illustrated best by the Senator himself when he said, "I actually voted for the 87 billion dollars before I voted against it."

He also recently said that he doesn't want to use the word "war" to describe our efforts to fight terrorism.

Well, ladies and gentlemen, I don't want to use the words "commander in chief" to describe John Kerry.

(APPLAUSE)

Just a year -- just a year after the first attack on the World Trade Center, most Senate Republicans and Senate Democrats rejected an amendment to slash our intelligence budget by $6 billion, but not John Kerry. It was his amendment.

Most Senate Republicans and Senate Democrats voted to give our combat troops in Iraq and Afghanistan the funding necessary for things like body armor, but not John Kerry.

When Vice President Gore urged the Senate to "Reinvent Government" and reduce the federal workforce, most Republicans and Democrats voted for it -- you guessed it -- but not John Kerry.

Republicans and Democrats in the Senate voted to reform the product liability system that was making trial lawyers rich while playgrounds and small businesses were closed, but not John Kerry.

Most senators in both parties voted to protect the institution of marriage through the Defense of Marriage Act signed into law by President Bill Clinton, but not John Kerry.

All right, enough about him.

(LAUGHTER)

(APPLAUSE)

Now, you may have heard me mentioned Maebell Turner as one of the great inspirations in my life. Maebell is just one of many faces in America who struggled to raise a family and believed that she could offer something more for her children.

She grew up the daughter of sharecroppers and had to quit school in the fifth grade to work a farm. She married a man who died of alcoholism.

She worked 45 years in a laundromat, making minimum wage, and still managed to send her kids to parochial school.

She never took public assistance, because as she put it, she didn't want the government raising her kids.

(APPLAUSE)

Maebell always saw the hope that her kids would be better off than she was. And she channeled her hope for that legacy into action. Today, Maebell Turner has a daughter who is an accomplished pediatrician and a son who is the lieutenant governor of Maryland.

(APPLAUSE)

A lifelong Democrat, she once asked me how I could grow up to be such a strong Republican. I simply replied, "Mom, you raised me well."

(APPLAUSE)

You see -- you see, Maebell understood. She raised me to understand and appreciate some of the enduring principles that are important to all of us. You cannot bring about prosperity by discouraging thrift.

You cannot strengthen the weak by weakening the strong. You cannot help the wage earner by pulling down the wage payer. You cannot further the brotherhood of man by encouraging class hatred. You cannot help the poor by destroying the rich. You cannot build character and courage by taking away man's initiative and incentive. And you cannot help men permanently by doing for them what they should do for themselves.

(APPLAUSE)

These are the beliefs of our Republican Party. These are the beliefs and the principles that drew me to this party 28 years ago. And today, the standard-bearer of these convictions is George W. Bush.

(APPLAUSE)

So my friends, as we leave this place at the end of this great week, let's continue to work to re-elect a compassionate man who understands people's yearning for freedom, a man who knows that families make better decisions than government, and a man who turns hope into action, and moves us all toward that shining city on a hill: our president, George W. Bush.

Thank you, and God bless.

KING: You've been listening to some remarks by Lieutenant Governor Michael Steele of Maryland, who apparently has quite a future in the Republican party. Let's get down to the floor and Jacque Reid, what are your thoughts?

REID: Yes. We heard the lieutenant governor just give a little zing to John Kerry. He started out about this being the party of Lincoln, talking about civil rights, talking about, you know, education, incarceration, a lot of issues that resonate with African- Americans. And this is part of that compassionate conservatism that the Republicans are trying to sell tonight.

You know, interestingly enough, Larry, There are a lot of young African-American voters who are moving more towards independence as opposed to being with the Democratic party like their parents. It will be interesting to see if the Republican party makes more of an effort to go after them. Michael Steele is one of three African- Americans speaking here tonight. The other one was Miss America, and before Michael Steele, the Secretary of Education Rod Paige.

So we'll see what happens with African-Americans after tonight.

KING: From my vantage point I couldn't tell at all, George, but we're told that he's getting about attention from half the audience. What's your read?

MITCHELL: I think that's about right. The delegates in the center of the hall, right directly in front of him appear to be paying attention. On the sides, and around to the rear, not. That's not uncommon at conventions, Larry.

KING: No?

MITCHELL: No. It's only a few speakers that get the attention. It's a very long grind. Four days and nights of listening to speeches, it's hard to pay attention to all of them, entertainment, things going on. Only a few people get the full attention of the crowd.

KING: Senator Dole, your party, though, has a long way to go with regard to the black community.

R. DOLE: We've got a long way to go. We've got a good record. You look at the record of Republicans in the House and Senate on civil rights, issues going way, way back. We've got a solid record. But we've got a long way to go. That's why somebody like Michael Steele -- Senator Mitchell is right. You never get all the audience unless you're the president or the candidate for president, but he's done pretty well. I've turned that way to look. And he's got a pretty good section there listening, and getting a great ovation, and making a powerful speech. He's really doing a pretty good job.

KING: Bob Woodward, what's your read on black America and the Republican party? WOODWARD: I don't know. They're working on it. They have a long ways to go. I think we ought to say that we'd be distressed to know how many people might have the television on watching CNN and not paying attention. It may be even less than half. So I don't find that particularly unusual. Certainly might be.

I thought Karen Hughes, what she said was very important. But in the end, she thinks this campaign is going to get down to the security issues, the war on terror, Iraq, foreign policy. Those are the commander-in-chief issues. And Senator Dole and I were speaking last night about this. This is the vacuum in the Kerry campaign or the comparative vacuum.

Where he's got to be more specific, and tell us what he would do, what his principles are, what the responsibilities would be for a secretary of state, a vice president, and so forth in a Kerry administration. I've no doubt he has very strong answers on those questions. But you can't concede the foreign policy, security election in this campaign and win. I think Karen Hughes is right in the end. Unless there's some big economic shock, that's what this campaign is going to be decided on.

MITCHELL: Larry, if I could just express a contrary view to Bob. I don't think Senator Kerry has in any way conceded it, nor do I think he will. I think he'll address it vigorously as he did at the convention. Secondly, Karen Hughes didn't say Iraq, you said Iraq. He said the war on terror. I don't think that the president can emphasize Iraq because it's a real mess there, including the tragic events of today. I think the emphasis will be on the war on terror and security. That's the whole theme of this convention. That's the whole theme of this campaign.

WOODWARD: That's a fair point.

MITCHELL: What she expressed was the intention of the Bush campaign to make that an issue. Kerry's going to have to...

KING: Bob Woodward and then Bob Dole.

WOODWARD: Real quickly, Senator Mitchell, Larry King did ask her do you consider Iraq part of the war on terror, and she said most emphatically yes. And of course the president has made that point. You're making a fair point. But their argument is that it fits in to the overall umbrella war on terror. You certainly can argue with that.

KING: Bob Dole, where do you stand in this disparity view here?

R. DOLE: Well, I've been trying to listen to the speech. I think we're hearing one of the better speeches we've had so far. And Michael Steele, is now getting a great ovation now pretty much from all the crowd. So I think he's hitting a nerve. I do believe it's going to be foreign policy. The war on terror is going to be a big issue.

KING: Will Iraq be hooked to that? Can the president sell Iraq-terror?

R. DOLE: I think so. I think so. I think you can make the case pretty easily.

KING: And you can hook him?

You think -- you don't think so?

MITCHELL: Well, obviously they're going to try. But, it will be difficult to make. And the other thing he'll try to do, Larry, is not to let the events in Iraq be the determining factor. Because, it is a mess. That's not a success. That's the problem they have.

KING: Jacque Reid, you want to give us a summation?

We only have about a minute left of Michael Steele.

REID: Yes, yes, Michael Steele he just left the stage. We've got a musical group up here. Now, Michael Steele, like you said, a moderate response from the audience, standing ovation towards the end. Again, most people here are excited about hearing the first lady, and then, of course, the "Governator" Arnold Schwarzenegger coming to the stage. That's what most people down here are talking about. We're right in front of the California delegation. They have their Arnold shirts out. They're excited about seeing the governor tonight.

KING: Thank you, Jacque. We'll be seeing you at midnight.

Bob Dole, you'll be back with us tomorrow night, of course. Senator Mitchell, you'll be back with us. And Bob Woodward, you'll be back with us tomorrow night, as well.

They're our regular panelists. We do have two editions of LARRY KING LIVE every night, at 9:00 and then we're back again at midnight. Mo Rocca joins us. We'll have some laughs. And comments on the speeches upcoming from Governor Arnold Schwarzenegger of California, and the first lady of the United States, Laura Bush.

I'm Larry King at Madison Square Garden. Hope you enjoyed this hour. Stay tuned. We'll have complete coverage of both speeches. Wolf Blitzer, Judy Woodruff and Jeff Greenfield will be aboard. I'm Larry King. See you at midnight. Don't go away.

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