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Inside Politics

Attack Launched on Falluja; McGreevey Preparing to Step Down in N.J.;

Aired November 08, 2004 - 15:00   ET

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

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


(BEGIN VIDEOTAPE)
ANNOUNCER: Thousands of soldiers and Marines storm into Falluja.

KARL PENHAUL, CNN CORRESPONDENT: The tracer fire lights the sky up as the Marines move in. Tanks have been blasting away inside the city.

ANNOUNCER: The new battle in Iraq is our top story.

Back at the White House, President Bush huddles with his defense secretary.

SCOTT MCCLELLAN, WHITE HOUSE PRESS SECRETARY: He is very involved in these discussions.

ANNOUNCER: Second term blues. It's happened before. Will we see it again?

UNIDENTIFIED MALE: What happens is presidents overstay their welcome.

ANNOUNCER: They didn't capture the White House, and they lost ground in Congress. So what do Democrats do to rebound? We'll speak with a senior senator with a history of reaching out to Republicans.

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

(END VIDEOTAPE)

WOODRUFF: Thank you for joining us.

We begin with the long-awaited offensive now under way in Falluja, aimed at crushing insurgents' hold on that Iraqi city. It is a potentially risky operation for U.S. and Iraqi troops and for the political powers that be here in Washington less than a week after election day.

We have correspondents in Iraq, at the White House and the Pentagon. In a moment we will hear from our Jamie McIntyre, who is at the Pentagon where they held a news conference just a short time ago.

And now let's go quickly to the Pentagon and our own Jamie McIntyre, where they held a news conference just a short time ago -- Jamie. JAMIE MCINTYRE, CNN CORRESPONDENT: Judy, it's been some time since we heard from Defense Secretary Donald Rumsfeld and Joint Chiefs Chairman General Richard Myers.

Secretary Rumsfeld explaining that he had been requested directly by the president not to -- to lower his profile during the election campaign, but he said he was anxious to come out and talk to the press about what was going on in Iraq, specifically the offensive in Falluja, which he says is totally necessary to wipe out areas where the insurgents hold sway.

But neither Rumsfeld nor General Myers were under any idea that this was the final showdown with the insurgency. In fact, they seemed to indicate that it might not even be the beginning of the end.

(BEGIN VIDEO CLIP)

GEN. RICHARD MYERS, CHAIRMAN OF THE JOINT CHIEFS OF STAFF: There is no -- if there were a silver bullet, we would have shot that a long time ago. There is not a silver bullet. This is very challenging work.

This new interim Iraqi government has shown great courage. They're working very hard to establish their own security forces, many of whom are working with us today side by side, sharing, probably spilling their blood with our blood as we try to make a way forward in Iraq that the majority of Iraqis want to have happen. So...

(END VIDEO CLIP)

MCINTYRE: The participation of those Iraqi security forces is seen key to the political settlement in Falluja, that it be seen as a solution that was imposed by the Iraqi government.

Pentagon officials concede that the number of Iraqis in the forces, just over 2,000, but there are more than 10,000 American troops there. There have also been, apparently, a small number of Iraqi forces who either have deserted or not shown up for battle.

The secretary of defense today said that that was an isolated -- those were isolated problems, and the chairman suggested that some of them might even be, quote, "administrative." That is, some of the Iraqis on leave to go back and take care of their families had simply not returned.

But nevertheless, the performance of those Iraqi troops and how that is perceived by the citizens of Falluja is acknowledged to be a key indicator of the success of this mission and also a harbinger of what kind of success overall can be expected in Iraq as they continue to build up the security forces, which ultimately is seen as the answer to defeating the insurgency and bringing stability to Iraq.

WOODRUFF: So Jamie, just to clarify, out of the 10 or 15,000 or so U.S. troops moving in on Falluja, how many Iraqi troops?

MCINTYRE: There's just over 2,000 Iraqi troops and some 10,000 U.S. troops. So the number they gave there was between 10,000 and 15,000. If you add those together, it's 12,000, 13,000, that's about -- that's the ballpark number of troops involved.

WOODRUFF: OK. Jamie McIntyre, thank you very much.

The White House is saying President Bush is working closely with Iraqi leaders to make that nation secure enough to hold elections. Let's go to the White House now and Elaine Quijano.

Hello, Elaine.

ELAINE QUIJANO, CNN CORRESPONDENT: Hello to you, Judy. That's right. The message here at the White House is that the United States continues to be in close consultation with the interim Iraqi government regarding the situation on the ground in Iraq.

We're told that President Bush earlier today met with Defense Secretary Donald Rumsfeld to talk about the developments there. We are also told by White House spokesman Scott McClellan that last Friday the president held a lengthy video conference meeting with members of his national security team to talk about Iraq.

The White House saying that the president looks to his commanders on the ground to make the decisions on military operations. But he does not try to micromanage that process.

And again, though, officials here very carefully emphasizing that two-way discussions are taking place, between the U.S. and the interim Iraqi government. When asked about how successful it can be measured in the Falluja operation, here's what White House spokesman Scott McClellan had to say.

(BEGIN VIDEO CLIP)

MCCLELLAN: The Iraqi government is the one, as I said, who is making the decision about how to address these matters in close consultation with the multinational forces. The terrorists and insurgents rejected a political solution. And now Prime Minister Allawi has made the decision to move forward, institute additional safety measures and to bring to justice those terrorists and insurgents who continue to spread violence and fear.

(END VIDEO CLIP)

QUIJANO: McClellan also adding that the goal really is to stabilize the environment there in order to move ahead with elections, which the U.S. fully expects will happen come January.

Now, one other bit of news we should tell you about, Judy, as the speculation continues here in Washington about who will stay and who will go within the Bush administration.

Less than a week after the election, we have one name now that we can take off of that list, the speculation list. White House spokesman Scott McClellan saying that Andrew Card, the White House chief of staff, was asked by the president to remain on for a second term. He has agreed.

That's so far, Judy, the only name that we know about for sure, Scott McClellan saying that he will not speculate. But Andrew Card to remain as White House chief of staff -- Judy.

WOODRUFF: All right. Elaine Quijano with the second-term watch, thank you very much.

We're going to have more on the offensive in Falluja and how it squares with public opinion about the Iraq war ahead.

Up next, the road ahead for Democrats after a difficult election day. I'll talk with retiring Senator John Breaux about where his party goes from here.

President Bush looks ahead to another four years. Can he avoid the stumbles that struck some previous two-term presidents?

And New Jersey's governor says good-bye. Closing the book on Jim McGreevey's tenure and the unusual circumstances that led to his resignation.

(COMMERCIAL BREAK)

WOODRUFF: These are live pictures coming into CNN from the Detroit area, where a small plane has crashed on the east side of that city this afternoon, hitting at least two houses in a residential neighborhood, starting some fires.

Miraculously, the pilot and a passenger have walked away from this crash. It happened about 2 p.m. Eastern Time. We are told no other injuries so far were reported on the ground.

Again, these pictures coming in as courtesy of CNN affiliate WDIV in Detroit.

We'll be right back with more.

(COMMERCIAL BREAK)

WOODRUFF: Checking the Monday headlines in our "Campaign News Daily."

One potential presidential hopeful in 2008 has delivered a post election speech in New Hampshire. Democrat Howard Dean criticized President Bush and his own party in a speech at Dartmouth College yesterday.

Dean said Mr. Bush ran a campaign on fear, anxiety and hate. And he also said the Democrats should stop moving too far to the political center. Dean declined to say if he plans another run for the White House.

Florida Governor Jeb Bush has denied any interest in running for president and the speculation in his home state may be shifting to a U.S. Senate race. With a victory for Senate candidate Mel Martinez fresh on their minds, the "Fort Lauderdale Sun-Sentinel" reports that some state Republicans want Jeb Bush to take on Democratic Senator Bill Nelson in 2006. However, Governor Bush told the newspaper that he is not interested in the Senate race.

As a Democratic winner in a big state, Illinois, Senator-elect Barack Obama is a hot commodity in his party and on the media airwaves. The "Chicago Sun-Times" reports that Obama plans to capitalize on his popularity by signing a book deal.

A spokesman tells the newspaper that Obama has hired well-known Washington lawyer Robert Barnett to represent him. An autobiography Obama wrote 10 years ago became a best seller after his speech to the Democratic convention.

Well, with Democratic leader Tom Daschle exiting the Senate after his Tuesday defeat, White House spokesman Scott McClellan was asked today if President Bush would regard Senator John Kerry as a top leader among Senate Democrats.

(BEGIN VIDEO CLIP)

MCCLELLAN: The Senate Democrats will determine who their leader is going forward, and the president looks forward to sitting down with those leaders and talking about how we can move together on the priorities for the American people and how we can work together to bridge our differences.

(END VIDEO CLIP)

WOODRUFF: Republicans took over Senate seats in five southern states on Tuesday, including the seat held by retiring Louisiana Democrat John Breaux. Senator Breaux is with me now here in Washington to talk about Tuesday's election and some other things.

Senator Breaux, good to see you.

SEN. JOHN BREAUX (D), LOUISIANA: Nice to see you.

WOODRUFF: So, a clean sweep for the Republicans in the south. How much -- and it's 55-45. How much does that change the Senate?

BREAUX: Well, I think it changes it substantially. They were a little bit closer to having the 60-vote margin that they have, and I would think that they would find some Democrats who would cooperate with them on some big issues.

But they still have to get 60s. They don't have a veto proof or filibuster proof United States Senate yet, so there's going to have to be some crossovers. They're going to have to be working together. Otherwise, you'll have stalemate again.

WOODRUFF: Who are some people that we should be looking to cooperate with the Republicans? Ben Nelson of Nebraska is up in '06?

BREAUX: Well, I think senators who are from moderate, middle of the road, mainstream states are going to have to look for ways in which they can work together for the good of the country and not to be perceived as being too partisan. But you can do that and still be loyal to the Democratic base.

The trick of the Democrats is to maintain our base but also to expand it. Neither party has a base that's large enough to win an election, neither Democrats nor Republicans.

WOODRUFF: But how do the Democrats do that? How do they both cooperate with the president on some of these big issues, big policy questions that are going to be coming before the Congress, and maintain and figure out what their own identity is?

BREAUX: Come up with good ideas. I mean, Bill Clinton did this. Bill Clinton talked about cops on the streets. He talked about balancing the budget, talked about welfare reform. And he was able to be successful in the northeast. He was able to be successful in the deep South. You can do it if you have good ideas.

I mean, this time it seemed like we were running against the Republicans and against God. We can't let them have that advantage.

WOODRUFF: But is it -- is it the message, Senator Breaux, or is it the messenger?

BREAUX: It's both. You have to have the right message, but you also have to deliver it. I mean, going back to Bill Clinton when he won, I mean, he was able to keep the party base, which is a tradition of minorities and labor, but he was also able to expand it into moderate, mainstream individuals.

So he had a good message, good ideas, and he was able to deliver it well. The next Democratic presidential candidate will have to do both of those things if he's going to be successful.

WOODRUFF: What are some names that come to your mind?

BREAUX: Evan Bayh is out there. I mean, I think Hillary Clinton is going to want to run. Either one of those who can articulate a moderate, mainstream message can be successful.

But you can't appeal just to the base. George Bush would not have been elected if he had just got the Republican base in his party. He was able to expand to the center. So the trick is, is to maintain your base and get enough independents, moderate and middle of the roaders in order to win.

WOODRUFF: Would Hillary Clinton be acceptable in the South?

BREAUX: Well, she's going to have to be able to try and articulate that type of message. Her husband certainly did it very well. And if she discusses those campaign ideas, he's going to tell her that I think she has to move towards the center and come up with those type of ideas, but that can be done.

Any candidate who can do both of those things can be successful in the south. You don't have to be from the South to speak Southern. You can come up with ideas that are appealing down there.

WOODRUFF: But are there -- again, on this whole question of Democrats cooperating with the president, whether it's tax cuts, whether it's a constitutional amendment to ban gay marriage, which Karl Rove said yesterday the president is going to continue to push on. Should Democrats cooperate on something like this if they don't agree on it?

BREAUX: Well, you have to come up with different ideas. I would have said look -- I think other would have said the same thing -- let states make that decision. If a state wants to enact a constitutional amendment in their state, they traditionally handle marriage issues, let them do it. And I'll support whatever the state says. That would have been a way to approach the issue in the presidential campaign.

But the whole thing is being able to say that, look, we are a party of faith, as well. Here is how we approach these ideas.

Don't be afraid of talking about these issues. If you don't talk about them, they'll think you're not supportive of good, moral values. I think to a certain extent, that happened.

WOODRUFF: And you're saying John Kerry didn't do that. We need to move quickly. Senator Breaux, your name has already come up as maybe one of those Democrats that President Bush might reach out to for his cabinet. Any conversations?

BREAUX: No, we talked about it four years ago, and I made a decision to stay in the Senate. Of course, I'm not in the Senate now, so -- you know, but we have not had any discussions whatsoever.

WOODRUFF: Would you be interested in serving in a Bush cabinet?

BREAUX: I'd be willing to talk to him about it, but I'm certainly -- I'm not out seeking anything. I mean, I think there's some things that we could certainly work together on, but I'm not seeking anything in a cabinet. And they have not offered me anything or talked about it at all.

WOODRUFF: You plan to stay in Washington?

BREAUX: We're going to stay around here and then divide our time up in Louisiana.

WOODRUFF: All right. Senator John Breaux, it's very good to see you.

BREAUX: Thank you, Judy.

WOODRUFF: We'll stay in touch.

BREAUX: Thank you.

WOODRUFF: Thank you very much. Appreciate it.

A strong election showing by President Bush and other Republicans is giving conservatives high hopes for the next four years, but will they have to come to terms with a second term reality? Ahead, a closer look at why some presidents have struggled after reelection.

(COMMERCIAL BREAK)

WOODRUFF: It is also midnight in Iraq, where U.S. and Iraqi forces are fighting their way into the rebel-held city of Falluja. Coming up, I'll talk with a military analyst about that fighting and what may happen next.

Plus, many on the religious right feel they helped put President Bush over the top in last week's election. So, is it payback time? I'll speak with a Christian conservative about what they expect from the president's second term.

But first let's go live to Wall Street for our own Rhonda Schaffler and an update on the financial markets.

Hi, Rhonda.

(STOCK REPORT)

(COMMERCIAL BREAK)

WOODRUFF: Jim McGreevey set off a political bombshell three months ago when he acknowledged that he is gay and admitted to having a homosexual affair. Today, New Jersey's governor bid farewell, but his departure is just the beginning of what could be next year's hot election.

Welcome back to INSIDE POLITICS. I'm Judy Woodruff in Washington. We're going to have more on today's so-long from the Garden State governor, but first our top story this afternoon.

The U.S. military assault on Falluja in Iraq is well under way. U.S. tanks are advancing on the insurgent stronghold at this hour. CNN's Karl Penhaul is reporting that explosions and heavy exchanges of gunfire are lighting up the night sky. The U.S. military advance was preceded by a heavy artillery barrage, along with aerial bombings by U.S. aircraft.

Huge explosions are also reported inside the city. Those blasts believed to be caused by roadblocks rigged with explosives.

At the Pentagon a short time ago, Defense Secretary Donald Rumsfeld said the Falluja mission would go along way towards securing Iraq.

(BEGIN VIDEO CLIP)

DONALD RUMSFELD, DEFENSE SECRETARY: No government can allow terrorists and foreign fighters to use its soil to attack its people and to attack its government and to intimidate the Iraqi people. Success in Falluja will deal a blow to the terrorists in the country and should move Iraq further away from a future of violence to one of freedom and opportunity for the Iraqi people -- General Myers. (END VIDEO CLIP)

WOODRUFF: And with me now to talk more about the assault on Falluja and the overall mission in Iraq is Michael O'Hanlon, a senior fellow at the Brookings Institution here in Washington.

Just quickly, Michael O'Hanlon, a moment ago, Jamie McIntyre was telling us that at the Pentagon they are also saying that this is just the beginning of an effort to route the insurgents in Iraq. So which is it? I think people are trying to get a handle on what this mean overall in the war.

MICHAEL O'HANLON, BROOKINGS INSTITUTE: Well, Judy, my guess is that the Falluja headquarters for this insurgency is their most important one in the whole country, and that the Pentagon says we maybe have 10,000 to 20,000 foreign terrorists, plus Iraqi insurgents throughout Iraq total, of which up to 5,000 are in Falluja. So this could be a quarter of the total resistance in the entire country, and it's certainly their most important sanctuary. So even though there may be follow-up attacks and there have been previous attacks in places like Samarra, if we get this one right, if could really make a big difference.

WOODRUFF: What is your sense of the risks here? We know they are already reporting four, I believe, is -- was Jamie -- was a report from Karl Penhaul, four U.S. casualties. What should Americans be expecting?

O'HANLON: Well, we could lose dozens of people in this sort of attack. We did back in April, even when it was called off before its completion.

The upside to this, Judy, is we are good at these sort of urban campaigns. We can take cities and we can seize particular targets, attack well-known locations of insurgents. The bad news is we don't necessarily know who the insurgents are. And they can also intersperse themselves among civilians.

So they may slip away, they may try to use innocent people as shields or hostages, and we could wind up causing a lot of public relations harm to our cause even if we wind up killing a number of them. So I am very open-minded about how this is going to turn out, hoping for the best but worried about all the risks.

WOODRUFF: What is your sense -- Jamie McIntyre reported that out of the 10,000 to 15,000 U.S. troops, there are -- I believe he said around 2,000 Iraqis, although there had been some reports of desertions. What is the significance of that?

O'HANLON: Well, that is probably a little higher number than I have seen elsewhere, but it's possible. The real significance, I think, Judy, is whether we can keep Iraqis in charge of this after it's over. Because we're going to have to police Falluja and maintain order there after this raid.

Otherwise, you have the risk of what happened before, where the Iraqis melt away, the insurgents melt away, and then just come back once we leave. Or our presence, which is now not appreciated by the people of Falluja, could be spurred to more attacks.

So what you really want is for the Iraqi security forces to help a little bit right now with this raid, but then to take the primary role after the raid is over in policing the streets. That's where I'm not sure they are even up to that job. So let's hope for the best there, too.

WOODRUFF: Michael O'Hanlon, you were saying to me a moment ago there's some likelihood that a number of these insurgents may just melt away and not fight. What is your sense of that?

O'HANLON: Well, if I were an insurgent I'd have two options. One is to melt away, because obviously I'm not going to be recognized. There isn't that kind of intelligence, and most of the population of Falluja is somewhat sympathetic to my cause.

So I can probably melt away and fight a different day, choose the time and place of the attacks. Or I can try to use a lot of civilians as shields to make sure the Americans have to kill a lot of innocent people even as they go after the insurgents.

So those are the two strategies I believe the insurgents have open to them. And frankly, they are both pretty good strategies. So again, we can certainly achieve a tactical success here, taking back certain neighborhoods, destroying certain buildings, but the overall strategic verdict on this is going to be hard to measure for a long time.

WOODRUFF: You're right. If they melt away, then where do they go from there and where does the U.S. go from there?

O'HANLON: That's right.

WOODRUFF: All right. Michael O'Hanlon, thank you very much at the Brookings Institute. Thank you very much.

O'HANLON: Thank you, Judy.

WOODRUFF: Well, here in Washington, the chief justice, William Rehnquist, was again absent when the Supreme Court convened today. Rehnquist has been working from home while he receives radiation and chemotherapy for thyroid cancer. There was no official update on his health, although there has been speculation that the 80-year-old Nixon appointee may retire soon.

Court watchers say President Bush could have more than one spot to fill on the Supreme Court before the end of his second term. There is a feeling among some analysts that the president is now in a good position to push a conservative agenda on the court, as well as in other areas. But as our Bruce Morton reports, high hopes for second- term presidents sometimes sour quickly.

(BEGIN VIDEOTAPE)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I earned capital in the campaign, political capital. And now I intend to spend it.

BRUCE MORTON, CNN NATIONAL CORRESPONDENT (voice-over): Second- term presidents usually sound like that, confident, men with a mandate, raring to go. It's astonishing how often it goes wrong.

The jinx? Well, Dwight Eisenhower had the U-2 affair, a U.S. spy plane shot down in the Soviet Union. The American pilot survived and confessed. Plus rumors the Soviets union were ahead of the U.S. in missiles. Not true, but it hurt.

Richard Nixon's second term brought Watergate. Resignation to avoid impeachment.

RICHARD M. NIXON, FMR. PRESIDENT OF THE UNITED STATES: I shall resign the presidency effective at noon tomorrow.

MORTON: Ronald Reagan's second term brought Iran Contra, news that the administration sold arms to Iran in exchange for help and freeing U.S. hostages in Lebanon, then used the money to buy arms for anti-government guerrillas in Nicaragua in defiance of a congressional ban.

RONALD REAGAN, FMR. PRESIDENT OF THE UNITED STATES: A few months ago I told the American people I did not trade arms for hostages. My heart and my best intentions still tell me that's true. But the facts and the evidence tell me it is not.

MORTON: Bill Clinton's second term was about a woman named Monica Lewinsky and impeachment.

WILLIAM JEFFERSON CLINTON, FMR. PRESIDENT OF THE UNITED STATES: Indeed, I did have a relationship with Ms. Lewinsky that was not appropriate. In fact, it was wrong.

MORTON: What goes wrong? Often they overreach.

ROBERT DALLEK, PRESIDENTIAL HISTORIAN: They lose their credibility, they lose their power to -- to dominate, to lead. They become lame ducks by the last two years of their second term. The Congress is not going to pay as much attention to them as they did in their first term, or even in the first two years of their second term. And so, conditions work against them.

MORTON: It isn't inevitable, but it is a pattern, partly because people in this very political city are already calculating "What will the ticket be in '08 and how could I be on it?"

Bruce Morton, CNN, Washington.

(END VIDEOTAPE)

WOODRUFF: Republicans add to their Senate majority. But will the president's judicial nominees face an extra hurdle within his own party? Up next, I'll ask a conservative activist about the president's second-term agenda and the potential role of Senator Arlen Specter, who is expected to become chairman of the Judiciary committee. (COMMERCIAL BREAK)

WOODRUFF: For the second time this hour, we are bringing you live pictures of a plane crash, a small plane crash. The first one in Detroit. This one in the suburbs of Atlanta, Georgia.

This plane, we are told, trying to land at Peachtree Dekalb Airport, just outside of Atlanta. So far, there are no reports of fatalities or injuries. But we are trying to get more information. These pictures courtesy of CNN affiliate WAGA. We're trying to get an update both on that crash, as well as the one in Detroit.

We'll be right back.

(COMMERCIAL BREAK)

WOODRUFF: With polls showing that voters cited values as their number one issue in this election, many social conservatives say they see last week's election as a victory for them and their agenda. I spoke just a short time ago with Jan Larue of the group Concerned Women for America. And I began by asking her what a Bush victory means for her and her organization.

(BEGIN VIDEOTAPE)

JAN LARUE, CONCERNED WOMEN FOR AMERICA: Well, very crucial for all of the values that we hold dear and try to represent here in Washington on behalf of all of our constituents. And we certainly concur that the thing that made the difference in this election in securing the reelection of our president is the vote of people who really care about moral values, and that includes issues that the Supreme Court looks at.

WOODRUFF: Well, let's tick off some of the issues that are -- that this president is likely to deal with and ask you what you expect from the president. I mean, just starting at the very top, this proposed constitutional amendment to ban gay marriage, what do you expect from the president on that?

LARUE: Well, the president has reiterated through his chief political adviser over the weekend in every show that I saw that clearly the president intends to back a federal marriage amendment. And of course an amendment doesn't require the president to sign it or anything, but certainly his endorsement is key.

And we expect that he will do that because he and we share a real concern about federal judges, and maybe even some more state judges who would declare that their state law on marriage and even a state constitutional amendment limiting marriage to a man and woman might violate equal protection or liberty under the federal Constitution. Also, we have concerns about the federal Defense of Marriage Act, which is again being challenged in several courts right now. So that's crucial.

WOODRUFF: So that's a priority. What about appointing judges to the Supreme Court, in particular where we know there may be vacancies in this term, who would seek to overturn Roe v. Wade? Is that a priority?

LARUE: Well, we agree with the president when he has said since day one over four years, and also reaffirmed in the debates, that he has one litmus test for judges, and that is whether or not they will set aside their own personal political beliefs and stick to interpreting the law rather than writing it. And we agree with that wholeheartedly. We do not see the Constitution as this living and growing document that so many hold to, but rather that it has a fixed text and the judge's job is to interpret that text.

WOODRUFF: As you are aware, I know Senator Arlen Specter, who is certainly looking at the chairmanship of the Judiciary Committee, said last week in so many words that the president needs to be mindful that there are members of the Senate who might not support a nominee like the one you describe.

LARUE: Yes.

WOODRUFF: Are you going to -- is your organization, Concerned Women for America, going to work to block Specter's -- Senator Specter's move to the chairmanship?

LARUE: Oh, absolutely. We are unequivocally opposed to Arlen Specter chairing that very crucial committee.

I mean, what a gall to on the day that the president accepts his victory to come out with a statement like this. And, you know, this is not an absolute thing for him to chair that committee. You know, the Senate controls its own rules, and the Republican leadership in the Senate could decide that, based on his statements, not only his statement on November 3, but also a 24-year record on his view of the Constitution, which he does hold to be this living and growing document, which sounds more to me like he's describing a fungus than the highest law of the land.

WOODRUFF: So you're saying that's more important than the bloc of so-called security interests?

LARUE: No, I'm saying it's equally as important to those who supported the president because they understand that what judges do effects every issue about which they are concerned. And that's not only the war against terrorism. When you look at some Supreme Court decisions last year, and, you know, the moral values issues in judges because judges effect all those things.

(END VIDEOTAPE)

WOODRUFF: Jan Larue of Concerned Women for America.

We're going to talk more ahead about the future of the Supreme Court and the abortion issue with a senator now figuring squarely in that debate, Republican Arlen Specter.

Did the president receive a mandate for tougher action in Iraq? When INSIDE POLITICS continues, we will put that issue in the "CROSSFIRE" to find out what Bob Novak and Paul Begala thinks. (COMMERCIAL BREAK)

WOODRUFF: Democrat Jim McGreevey wrote a postscript today for his shorter-than-planned tenure as the governor of the state of New Jersey. Three months after he announced that he is gay and resigning, McGreevey spoke of being a changed man who has regrets but also hope.

CNN's Jennifer Michael has more on McGreevey's farewell and New Jersey's political future.

(BEGIN VIDEOTAPE)

(APPLAUSE)

GOV. JIM MCGREEVEY (D), NEW JERSEY: Thank you, my friends.

JENNIFER MICHAEL, CNN CORRESPONDENT (voice-over): In front of hundreds of staffers, friends and political allies, Governor Jim McGreevey delivered the sequel to his bombshell resignation speech. Once again, the New Jersey Democrat spoke in unusually personal terms: a quote-laden reflection on his abbreviated time in office that began with an apology.

MCGREEVEY: I have to begin today with humility by simply saying I'm sorry.

MICHAEL: McGreevey did not dwell on any of the specifics today, but he has acknowledged that his tenure will be remembered first and foremost for this...

MCGREEVEY: I am a gay American.

MICHAEL: McGreevey's announcement three months ago was an unparalleled political moment; a public figure revealing his inner turmoil, spilling his deepest secret on live television. In his farewell address, McGreevey thanked those who stood by them, but McGreevey's critics are quick to note he only came forward when threatened with a sexual harassment suit by former aide Golan Cipel. And they charge his appointment of Cipel to a top homeland security post was just the latest example of his handing out political favors.

MCGREEVEY: To be clear, I am not apologizing for being a gay American, but rather for having let personal feelings impact my decision-making, and for not having had the courage to be open about whom I was.

MICHAEL: McGreevey spent surprisingly little time listing his accomplishments in office. Instead, he talked at some length about bitterness and division in American politics.

MCGREEVEY: We smile in person and then throw each other under the bus when we leave the room. In this context, public service can be reduced to a blood sport.

MICHAEL: When McGreevey actually leaves office one week from today, Senate President Richard Codey takes over as acting governor. Codey hasn't said whether he'll run in 2005 after serving the remainder of McGreevey's term, but New Jersey Senator Jon Corzine is waiting in the wings.

SEN. JON CORZINE (D), NEW JERSEY: I will look seriously in 2005 and whether I think that what I believe is an uncomfortable feeling by the people of New Jersey about how our state government has worked.

MICHAEL: By most accounts, a run for governor now seems even more attractive to Corzine after losses by Democrats around the country on Election Day. But Republicans relish the thought of reclaiming the governor's office in blue state New Jersey.

Among the possible contenders, Brett Schundler, who lost to McGreevey in 2001, and Douglas Forrester, who ran unsuccessfully for the Senate in 2002. As for McGreevey, he reportedly will announce his future plans soon, including some kind of public service.

Jennifer Michael, CNN, reporting.

(END VIDEOTAPE)

WOODRUFF: President Bush promised that he would stay the course in Iraq during his reelection campaign. So did the election results give Mr. Bush a mandate for tougher action?

That sounds like a topic for the hosts of CNN's "CROSSFIRE," Paul Begala and Bob Novak, who join us now live from George Washington University.

Gentlemen, first of all, what is the president's mandate when it comes to Iraq -- Paul.

PAUL BEGALA, CO-HOST, "CROSSFIRE": Well, it's very mixed. He did take his case to Iraq to the American people and he did win. And so, in that sense, yes, he has a mandate.

But at the same time, those very same Americans who gave him an electoral victory on Tuesday -- let me -- I wrote it down here -- 55 percent said they thought the war was going badly, 52 percent said they thought the war had made us less secure. And so I think the American people were trying to tell him they wanted to keep the president, but they wanted a new strategy. Now, maybe today this invasion of Falluja suggests there's a new strategy, but it's even more aggressive than the old strategy.

WOODRUFF: Bob...

ROBERT NOVAK, CO-HOST, "CROSSFIRE": I guess those election returns, Judy, are from the same exit polls that had John Kerry winning in a landslide. So I would take it with a grain of salt.

As a matter of fact, this -- this operation on Falluja was planned to come after the election. There would have been a tremendous uproar if it happened before the election.

But -- so it wasn't a matter of a mandate. And I don't believe any American president needs a mandate for effective military action. The American people always support effective military action. It's the ineffective military action that they don't support. So the test is in -- is how this operation turns out.

WOODRUFF: So you are saying, Bob, no connection between the results of the election and what we see in Falluja other than the fact, as you said, they waited until it's over?

NOVAK: Yes, of course. Now, this -- Judy, this was planned. This was going to go ahead if John Kerry got to be the president-elect.

BEGALA: Well, but that should be commented on. I think Bob is right.

I think that -- well, seven months ago we know that they invaded Falluja for three days and they pulled back. The general on the ground at the time, General Conway, said that he thought that his leadership vacillated and that it made the situation worse in Falluja. And so they put it off until the election.

You know, there's really something extraordinary about timing a military action, using it for political ends. And it seems to me that's -- Bob says, too, that's what the president has done.

NOVAK: I don't see how you can use -- you use it for political ends when he is already reelected. I mean, that -- the problem -- the problem is that if he -- I think this is going to be a very successful operation. Americans, meaning not some liberals around here in Washington in the blue states, but most Americans like military victories.

And this is going -- I will make a prediction. I don't make many predictions on this program. I think it's going to be a military victory. So it will have been a plus for President Bush. And the same people who are saying why did he wait until the election would have said why did he do it before the election.

BEGALA: No, my point is that if it was right to take Falluja, the sooner the better. Because now we've given the enemy seven months to fortify Falluja.

I'm sure Bob is right. We will take Falluja. And thank god we have great courageous young men on the ground who are going to do it.

But those guys are facing tougher odds today because we gave the enemy seven months to prepare after a three-day aborted invasion. They knew we were coming. They've had seven days to -- seven months to fortify their city just for political ends. And I think that's a shame.

WOODRUFF: We're going to have to leave it there. Paul Begala and Bob Novak, we're going to see you both on "CROSSFIRE" at 4:30 Eastern. Thank you very much.

NOVAK: Thank you, Judy.

BEGALA: Thanks, Judy.

WOODRUFF: And with us now on the telephone from just outside Falluja, CNN's Jane Arraf. Jane, we -- do you have an update for us?

JANE ARRAF, CNN BAGHDAD BUREAU CHIEF: Judy, we are on the outskirts still, the northeast side of the city. But other units of Taskforce 22 from the Army's 1st Infantry Division have been moving further in, as far in as 800 meters into the city.

Out here, in between, they have been blowing up railroad tracks to allow them to move further. They've also for more than an hour been detonating a series of booby-traps.

This is what U.S. forces had expected and had feared as they began to move into the city. But there was a series of improvised explosive devices, homemade bombs, laid out in patterns to try to prevent them from moving in. The Army, the units that we're with, have been firing at these with tanks, causing huge explosions.

This is a sector of the city where there are very few civilians. In fact, officials have told us that they believe insurgents have prevented civilians from moving back into this area as they have been rigging up buildings and barriers and almost everything else with these homemade bombs. They are continuing to detonate them, and they are now detonating -- the Army is blowing up railroad tracks to allow them to go further -- Judy.

WOODRUFF: Jane, can you give us any sense of what you expect in the hours to come?

ARRAF: Quite unpredictable right now. But so far, part of it at least is going according to plan, in that the Army was paving the way with its heavy armor for the Marines. It has breached the city at a couple of points, and it does have troops moving forward, as well as Iraqi troops, a very important part of this, moving forward.

Now, this will go on for a long time. It has been going on for hours.

The city is in complete darkness -- electricity has been cut -- apart from fires burning. But oddly, there is a mosque somewhere in the city that is continuing to be able to broadcast "God is greater," and that is carrying to the further reaches of the city. There is still sporadic explosions out here, and the insurgents have been firing.

The unit that we're with believes that they have perhaps killed at least 25 suspected insurgents, but that's out of possibly 2,000 or more insurgents throughout the entire city. This is expected to go on for some time -- Judy.

WOODRUFF: All right. CNN's Jane Arraf, as she said, just on the outskirts of Falluja. But she is reporting on U.S. troops moving inside the city itself. Thank you, Jane, very much.

And again, we are watching developments in Falluja. We will continue to bring them to you just as often as we get them here at CNN from our correspondents.

Coming up, with the chief justice ailing, is a political slugfest over a Supreme Court nominee inevitable? I'll ask Senator Arlen Specter when INSIDE POLITICS continues.

(COMMERCIAL BREAK)

WOODRUFF: It is just before 4:00 on the East. As the markets get set to close on Wall Street, I'm joined by Lou Dobbs in New York with "The Dobbs Report."

Hi, Lou.

LOU DOBBS, "LOU DOBBS TONIGHT": Hi, Judy.

Stocks barely moving today after the big rally that followed President Bush's reelection last week. As the final trades are now being counted, the Dow Jones Industrials up just over three points, approaching a four-point gain on the day. The Nasdaq Composite just barely higher, as well. Trading today light. Very light. Investors looking to Wednesday's Federal Reserve meeting. The Fed is expected to raise interest rates for a fourth time this year. And the dollar today hit another new low against the euro before recovering a bit. Our huge trade deficits are driving the dollar lower and there's no end in sight.

Oil prices today fell again extending the decline of the past two weeks. Crude oil price now just above $49 a barrel.

Disney and Pixar, six for six. Their animated film "The Incredibles" rang up more than $70 million at theaters over the weekend, the second biggest opening for an animated film ever. Disney and Pixar have created six blockbuster animated films together including "Toy Story," "Monsters" and "Finding Nemo." "Finding Nemo" brought in $864 million. But some analysts say "The Incredibles" may not be able to quite match that. Shares of Pixar down 6 percent in fact today. A downgrade there. Pixar has one more film under its current agreement with Disney.

Another investigation into stock trading on Wall Street. Sources tell us that the SEC is investigating as many as a dozen companies on suspicions that they didn't give their customers the best prices for stocks. Some of the biggest names in the industry are under scrutiny. Morgan Stanley, Merrill Lynch, Charles Schwab, Ameritrade, and E*TRADE included. For individual investors the amount lost may be only pennies per trade but given the millions of trades executed each day by brokers the small overcharges could boost the company's bottom line significantly.

Coming up here on CNN at 6:00 p.m. Eastern on "LOU DOBBS TONIGHT" a special report on illegal immigration. The federal government isn't protecting our borders and three million illegal aliens are expected to enter the country this year. But a Pennsylvania district attorney using local law enforcement to protect his community.

(BEGIN VIDEO CLIP) UNIDENTIFIED MALE: The message here in (UNINTELLIGIBLE) is if you come here and you're violating state law by utilizing false I.D.s and other people's Social Security cards, you're going to be arrested.

(END VIDEO CLIP)

DOBBS: Also tonight, House Minority Leader Nancy Pelosi joins me to talk about the future of the Democratic party and the role of the loyal opposition now in Washington. And former White House counsel C. Boyden Gray will join me to give us his perspective on President Bush's historic reelection and possible appointments to the U.S. Supreme Court.

And we being our series this week, "The Bush Agenda." We'll be investigating whether the president will be able to effect dramatic change during his second term. Tonight we take a look at the president's pledge to focus on economic recovery. Now back to Judy Woodruff in Washington -- Judy.

WOODRUFF: Lou, I know you're keeping an eye on the prospects for reforming or overhauling the tax code. What is your sense of the political obstacles here for the president?

DOBBS: Well, like nearly every other item on his agenda, Judy, as you know, the obstacles are significant. But it appears that there's more common ground here than might otherwise be expected. Both Democrats and Republicans alike believe that the Internal Revenue Service code is a mess. It is how they would change, how they would reform it and the devil is always in the details. But there is probably more bipartisan support for that particular idea than any other that the president is articulating.

WOODRUFF: Lou Dobbs. we'll see you at 6:00. Thank you very much. We appreciate it. INSIDE POLITICS continues right now.

(BEGIN VIDEOTAPE)

ANNOUNCER: On the move in Iraq.

PENHAUL: Parts of Falluja are now on fire. A red glow is lighting up the sky.

ANNOUNCER: U.S. forces smash their way into the rebel held city.

Did President Bush win reelection because of Iraq or in spite of Iraq? Our Bill Schneider investigates.

SEN. ARLEN SPECTER (R), PENNSYLVANIA: When you talk about judges who would change the right of the woman to choose and overturn Roe versus Wade, I think that is unlikely.

ANNOUNCER: He's been the senator in the spotlight since those comments last week. Arlen Specter is our guest this hour.

Now, live from Washington, JUDY WOODRUFF'S INSIDE POLITICS. WOODRUFF: Thanks again for joining us. Well, as Washington looks ahead to the possibility of a new addition to the Supreme Court, a possibility, one Republican has become something of a lightning rod on this issue. He joins us now, Senator Arlen Specter, Republican of Pennsylvania who is in line to become chairman of the judiciary committee. First of all, Senator Specter, thank you very much for being with us.

SPECTER: Delighted to be here, Judy. Thanks for the invitation.

WOODRUFF: Well, you appear to be in a whole lot of hot water with certain members of your party who are still angry over what you said last week about the problems the president would face if he nominated a Supreme Court justice who favored overturning Roe versus Wade.

SPECTER: Judy, I was not warning the president of anything. It was misreported. What I was saying was that when you have to have 60 votes in order to cut off debate to have cloture and you have 55 Republicans, that's an issue we have to face. And it is just a political fact of life.

WOODRUFF: Have you heard from, in the storm of criticism and we know now they are actively gearing up to block your move to become chairman, are you able to have a conversation with some of these folks who are really upset with you still?

SPECTER: Sure. I've had a lot of conversations and when I point out to them what the facts are the going gets easier. When I point out to them that I've never had a litmus test, that I voted for Chief Justice Rehnquist to confirm him and that's long after he wrote against Roe v. Wade, that I voted to confirm Justice Scalia and Justice O'Connor and Justice Kennedy and I almost lost my seat, I led the fight to confirm Justice Thomas and I almost lost my seat as a result of it in the United States Senate. And every one of President Bush's nominees I have supported in the committee and on the floor.

Listen, Judy, those are the facts. It so happens that I'm pro choice. The only pro choice Republican on the committee. But I don't make the decisions. I've supported pro life nominees because it is the function of the president to put up qualified people and a senator to support people who are qualified.

WOODRUFF: What is your view on the possibility that Roe versus Wade might be overturned in part or in whole?

SPECTER: Well, I think that it is difficult because it is a longstanding rule and very distant line, Judy.

WOODRUFF: But would it concern you if it were to be overturned in part or in whole?

SPECTER: I am very much opposed to abortion personally. But I don't think it is the government's rule. But when you talk about overturning Roe versus Wade you have to face up to the fact that it was reaffirmed in 1992 by an opinion written by three justices appointed by Republicans. And one of those justices, Justice Anthony Kennedy is very strong pro life and very conservative. And so is Justice O'Connor. The other Justice Souter not quite in the same camp but I think the reality is that it is hard to overturn. But look here. I'm giving you my opinion. Under separation of powers, that's not for me to decide. My rule is to look at what the president does, to give him deference because he's the president. Separation of power says the judiciary committee is supposed to confirm qualified judges and then what the Supreme Court does, that is their function, not my function.

WOODRUFF: But when we hear conservatives, and I interviewed earlier, Jan LaRue of Concerned Women for America, when she says that we need justices who will strictly uphold the letter of the constitution and not interpret it in some way to suit our modern sensibilities in so many words, I'm paraphrasing. In essence she and others are saying we believe that Roe versus Wade should be overturned.

SPECTER: She may be right. And there may be new appointments who will do that. Look here. I think I can help the president...

WOODRUFF: Is that something you can live with?

SPECTER: I believe in the rule of law, Judy. And if the Supreme Court makes a decision, I will abide by what the Supreme Court does.

WOODRUFF: And you're not going to stand in the way of an appointee who would vote to overturn Roe versus Wade?

SPECTER: Absolutely not. And it's not just what I'm saying. I have done it. I have not applied a litmus test. And I voted to confirm pro life judges. Judy, let me give you two Pennsylvania judges who I worked very hard to confirm. Two very conservative judges. Brook Smith (ph) and a man named Mike Fisher who ran for governor and we all knew they are pro life. Let me just finish. It is important. The Democrats opposed them. And I went to the Democrats and persuaded them on the totality of the facts that these were two of President Bush's nominees who ought to be confirmed. They didn't hold my views but they were qualified. And I fought successfully to have them confirmed.

WOODRUFF: But you have some, again, active conservatives who are very upset. Let me just quote to you one thing she said. She said, "I don't" -- in essence, she's not just opposing your move to the chairmanship because of what you said last week. She said: "But also a 24-year record on his view of the constitution which he does hold to be this living and growing document which sounds to me more like he's describing a fungus than the highest law of the land." So in essence it's your record in the Senate that they are objecting to. What do you say to these individuals who are just fiercely opposed to the idea of your succeeding to the chairmanship?

SPECTER: What I'd say to them the facts speak more loudly than those generalizations. And the facts are that I've supported all of President Bush's nominees in committee and on the floor. And I have voted to confirm strict constructionists who are pro-life judges. It is true that I do not believe you can go back to 1868 when you pass the Equal Protection Clause and look to the intent of the Senate when the galleries was segregated. So, if she's saying there that it is not what they intended in 1868 that can carry forward today, it is true -- that there are those modifications. But I don't think anybody would disagree with that.

WOODRUFF: As you sit here today, Senator Specter, how confident are you that you -- that the chairmanship will be yours?

SPECTER: Judy, confidence is a word I do not use. I've been in a lot of elections. I don't take anything for granted. I'm talking to my colleagues. I'm leaving no stone unturned. I have been training for this job for a long time. I have been on the committee for 24 years. I think I can help the president, and I think I can help the country. And that's why I've continued to run for the United States Senate.

WOODRUFF: Senator Arlen Specter joining us this week after the election. Thanks very much.

SPECTER: Nice talking to you, Judy. Thank you.

WOODRUFF: We appreciate it. Congratulations.

SPECTER: Thank you.

WOODRUFF: We appreciate it.

Well, as the assault on Falluja in Iraq continues, what happened to Iraq as a political issue? Up next, we'll have the very latest developments on the fighting in Iraq.

Plus, our Bill Schneider considers the war as one factor in this election with limited effect apparently on the voters.

(COMMERCIAL BREAK)

WOODRUFF: The White House is vowing that insurgents now under attack by U.S. and Iraqi forces in Falluja will be defeated. Ten to 12,000 U.S. troops and about 2,000 Iraqi forces streamed into the city after dark.

A medic in the field tells CNN that four Marines were wounded in one incident. The mission only underscores the challenges ahead for President Bush in his second term, as well as Americans' concerns about the conflict.

But as our senior political analyst Bill Schneider explains, those concerns were not as evident as many expected them to be on Election Day.

(BEGIN VIDEOTAPE)

WILLIAM SCHNEIDER, CNN SR. POLITICAL ANALYST (voice-over): Iraq was supposed to be the driving issue in the presidential election. It wasn't.

When asked to choose the issue that mattered most to them, only 15 percent picked Iraq behind moral values, the economy, and terrorism. Those concerned about Iraq voted overwhelming for John Kerry. Democrats can now debate whether they might have won if they had run more forcefully against the Iraq war.

Iraq was the driving issue behind Howard Dean's campaign for the Democratic nomination.

HOWARD DEAN (D), FMR. PRESIDENTIAL CANDIDATE: The administration launched the war in a wrong way at the wrong time.

SCHNEIDER: In fact, Kerry adopted that view.

SEN. JOHN KERRY, (D-MA), FMR. PRESIDENTIAL CANDIDATE: It's the wrong war in the wrong place at the wrong time.

SCHNEIDER: But President Bush hammered him mercilessly for flip- flopping on the issue. Kerry tried to maximize his differences with Bush on Iraq.

KERRY: I have laid out a different plan because the president's plan is not working.

SCHNEIDER: Bush tried to minimize them.

BUSH: My opponent says he has a plan. Sounds familiar, because it is called the Bush plan.

SCHNEIDER: The result? Iraq was diffused as a voting issue. But the issue didn't go away. Most voters on November 2nd did not think things were going well for the United States in Iraq. Bush did not get reelected because of Iraq. He got reelected in spite of Iraq.

And look at what's happened. A poll taken immediately after Election Day asked people to choose which issue should be the highest priority for Bush's second term. Guess which issue was number one? Iraq.

The pressure is still on President Bush to resolve the Iraq problem as quickly as possible. That is what Bush says he's trying to do.

BUSH: In order for Iraq to be a free country, those who are trying to stop the elections and stop a free society from emerging must be defeated.

(END VIDEOTAPE)

SCHNEIDER (on camera): So, despite Bush's majority, it is hard to read the results of this election as a mandate for his Iraq policy -- Judy?

WOODRUFF: Very interesting looking at those numbers coming out of Election Day and in the poll afterwards. SCHNEIDER: Afterwards.

WOODRUFF: OK. Bill Schneider, thank you very much.

Last week was a tough one for the Democrats, so now the inevitable question: What next? We'll be joined by pair of our regular guests to kick that question around after the break.

(COMMERCIAL BREAK)

After a strong Republican showing in last week's elections, many Democrats are scratching their heads wondering where they go from here. Joining us now to help begin to answer that question are Ron Brownstein of "The Los Angeles Times" and Dan Balz of "The Washington Post."

Dan, to you first. This whole question of what the Republicans did right, what the Democrats did wrong, we're six days out from this election. What more do we know about why this election turned out the way it did?

DAN BALZ, "THE WASHINGTON POST": Well, I think one of the things that we've learned in the past five or six days is that while moral values were certainly an element of George W. Bush's re-election victory, that is not the only answer and it's not the only reason.

I think one of the things the president was able to do was that he was able to poach, in a variety of ways, on some of the turf that is better for Democrats historically. He inched up his margins in a number of groups, among women, among Hispanics. He actually did better than he did last time among people who are less religious rather than more religious.

So he found ways to pick off inch by inch ground that the Democrats had held while securing and deepening what he had in the past.

WOODRUFF: Why was he able to do all this?

RON BROWNSTEIN, "THE LOS ANGELES TIMES": And I think the last thing Dan said there is really in many ways the most important. What I think what happened in this election is two things. The president was able to erode the edges of the Democratic coalition. He didn't really threaten the core of it. Democrats did win 18 of the 20 states, at least, depending on what happens in New Mexico.

Certainly 18 of the 20 states that they won last time. But they were simply unable, Judy, to challenge him where he was strong. If you look at the 29 states that George Bush won in 2000 and again in 2004, in 21 of them John Kerry was held to 43 percent of the vote or less. He simply never got off the runway.

And in the end, that left them with two few -- too little a margin for error as they tried to get to 270. They were contesting, at the very end of this election, only three states that Bush won last time. And you get to the end of October and you're a Democrat and you have to win Ohio, that is a very difficult position to be in.

WOODRUFF: Why weren't the Democrats able to do better on these points, Dan?

BALZ: Well, they certainly tried. At the beginning of this campaign there were people in the Kerry camp who genuinely thought they could expand the map. But I think as they tried they found that they did not have the voice, they did not have the message, they did not have, as James Carville put it earlier today at a breakfast with reporters, they did not have the narrative.

They had a litany of things that Kerry wanted to do but they didn't have a narrative that tied them together and they didn't have a way to reach beyond that traditional base that they were so secure with.

WOODRUFF: What would you add?

BROWNSTEIN: I would add, Judy, that the problem they face is that the Republican hold in the red states is deepening. Not only was President Bush enormously strong and even stronger in those states, but they moved further in a Republican direction in Congress.

If you think of those 29 states that Bush won twice, the Republicans now hold 44 of those 58 Senate seats. And they hold about three-fifths of the House seats in those red states, almost two-thirds of the House seats.

That basically says that unless the Democrats can put more of the map in play, they're going to be at a systematic disadvantage both in the presidential race and in the congressional race.

WOODRUFF: All right. So, Dan, how do they do that?

BALZ: Well, I think one of the things, Judy, is that they have to realize that they are in fact the out-party and the opposition party. The Democrats in a funny way seem to have the worst of both worlds. There are in fact the minority party at this point, but they continue to act somewhat like the Washington party.

I think one of the things they are going to have to do is get out of the Washington mentality and go out into the states and look for fresh faces who can articulate kind of an anti-Republican Washington message that Republicans have been so successful for in their out years and in the way they have come back over the last decade.

WOODRUFF: So is it finding fresh faces, Ron, or tinkering with the message itself?

BROWNSTEIN: I NEVILLE: ink it is both. But it is probably the fresh faces even more important. Look, finding Democrats who can compete in the red states is the long-term answer to both of these problems. In the long run they are probably not going to improve their congressional position in the red states unless they have a presidential nominee and more likely a president who can change the party's image and improve it in places like the South and the Southwest, but especially the South.

You know, if you consider that other than Florida the Democrats did not seriously contest any southern state this time, they effectively conceded 141 Electoral College votes to President Bush, more than half the total he needed. And I think you learned again in October that it is very hard to get to 270, if you do that. Again, if a Democrat is in a situation where they have to win Ohio, that is a very tough place to be.

WOODRUFF: Dan, are there fresh faces out there for the Democrats to discover?

BALZ: Sure there are, Judy. I mean, there are a variety of governors around the country. Governor Vilsack of Iowa who has won in a rural state, Governor Napolitano, Governor Sebelius, Governor Warner of Virginia, there are a number of people, Governor Richardson in New Mexico, a number of governors that they can look to.

And the question really is, will they look to them, will they listen to them and will those governors actually have real answers? I don't think that this is a sort of a simple solution that they have got. It is in many ways a kind of back-to-basics to reexamine who they are and what they are.

But they do have bright and attractive people around the country. The question is how they marshal them together and who -- in a sense in the way that Bill Clinton did when the Democrats were in the wilderness in the '80s, who figures out, who articulates, who digests, who synthesizes, who comes up with that new Democratic message.

BROWNSTEIN: Unless -- I think this election showed the Democrats that unless they can force the Republicans to defend more of their turf, that the Republicans can focus enormous firepower on what Dan talked about, eroding Democratic turf. The amount of time and energy that President Bush was able put on states like Michigan and Pennsylvania, even an increased vote in New Jersey I think is a real warning for the Democrats that unless they can broaden this battlefield, they will continue to be in a defensive and eroding position.

WOODRUFF: We're going to have to leave it there. I have many more questions for both of you, including how much the Democrats should be working with the Republicans. But we're going to save that for the next chat.

Dan Balz of "The Washington Post," Ron Brownstein of "The Los Angeles Times", good to see both of you, gentlemen.

BROWNSTEIN: Thank you.

WOODRUFF: Thank you very much.

BROWNSTEIN: Thanks, Judy.

WOODRUFF: INSIDE POLITICS will be right back.

(COMMERCIAL BREAK)

WOODRUFF: That's it for this Monday after-the-election edition of INSIDE POLITICS. I'm Judy Woodruff. Thank you for joining us. "CROSSFIRE" starts right now.

TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com


Aired November 8, 2004 - 15:00   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(BEGIN VIDEOTAPE)
ANNOUNCER: Thousands of soldiers and Marines storm into Falluja.

KARL PENHAUL, CNN CORRESPONDENT: The tracer fire lights the sky up as the Marines move in. Tanks have been blasting away inside the city.

ANNOUNCER: The new battle in Iraq is our top story.

Back at the White House, President Bush huddles with his defense secretary.

SCOTT MCCLELLAN, WHITE HOUSE PRESS SECRETARY: He is very involved in these discussions.

ANNOUNCER: Second term blues. It's happened before. Will we see it again?

UNIDENTIFIED MALE: What happens is presidents overstay their welcome.

ANNOUNCER: They didn't capture the White House, and they lost ground in Congress. So what do Democrats do to rebound? We'll speak with a senior senator with a history of reaching out to Republicans.

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

(END VIDEOTAPE)

WOODRUFF: Thank you for joining us.

We begin with the long-awaited offensive now under way in Falluja, aimed at crushing insurgents' hold on that Iraqi city. It is a potentially risky operation for U.S. and Iraqi troops and for the political powers that be here in Washington less than a week after election day.

We have correspondents in Iraq, at the White House and the Pentagon. In a moment we will hear from our Jamie McIntyre, who is at the Pentagon where they held a news conference just a short time ago.

And now let's go quickly to the Pentagon and our own Jamie McIntyre, where they held a news conference just a short time ago -- Jamie. JAMIE MCINTYRE, CNN CORRESPONDENT: Judy, it's been some time since we heard from Defense Secretary Donald Rumsfeld and Joint Chiefs Chairman General Richard Myers.

Secretary Rumsfeld explaining that he had been requested directly by the president not to -- to lower his profile during the election campaign, but he said he was anxious to come out and talk to the press about what was going on in Iraq, specifically the offensive in Falluja, which he says is totally necessary to wipe out areas where the insurgents hold sway.

But neither Rumsfeld nor General Myers were under any idea that this was the final showdown with the insurgency. In fact, they seemed to indicate that it might not even be the beginning of the end.

(BEGIN VIDEO CLIP)

GEN. RICHARD MYERS, CHAIRMAN OF THE JOINT CHIEFS OF STAFF: There is no -- if there were a silver bullet, we would have shot that a long time ago. There is not a silver bullet. This is very challenging work.

This new interim Iraqi government has shown great courage. They're working very hard to establish their own security forces, many of whom are working with us today side by side, sharing, probably spilling their blood with our blood as we try to make a way forward in Iraq that the majority of Iraqis want to have happen. So...

(END VIDEO CLIP)

MCINTYRE: The participation of those Iraqi security forces is seen key to the political settlement in Falluja, that it be seen as a solution that was imposed by the Iraqi government.

Pentagon officials concede that the number of Iraqis in the forces, just over 2,000, but there are more than 10,000 American troops there. There have also been, apparently, a small number of Iraqi forces who either have deserted or not shown up for battle.

The secretary of defense today said that that was an isolated -- those were isolated problems, and the chairman suggested that some of them might even be, quote, "administrative." That is, some of the Iraqis on leave to go back and take care of their families had simply not returned.

But nevertheless, the performance of those Iraqi troops and how that is perceived by the citizens of Falluja is acknowledged to be a key indicator of the success of this mission and also a harbinger of what kind of success overall can be expected in Iraq as they continue to build up the security forces, which ultimately is seen as the answer to defeating the insurgency and bringing stability to Iraq.

WOODRUFF: So Jamie, just to clarify, out of the 10 or 15,000 or so U.S. troops moving in on Falluja, how many Iraqi troops?

MCINTYRE: There's just over 2,000 Iraqi troops and some 10,000 U.S. troops. So the number they gave there was between 10,000 and 15,000. If you add those together, it's 12,000, 13,000, that's about -- that's the ballpark number of troops involved.

WOODRUFF: OK. Jamie McIntyre, thank you very much.

The White House is saying President Bush is working closely with Iraqi leaders to make that nation secure enough to hold elections. Let's go to the White House now and Elaine Quijano.

Hello, Elaine.

ELAINE QUIJANO, CNN CORRESPONDENT: Hello to you, Judy. That's right. The message here at the White House is that the United States continues to be in close consultation with the interim Iraqi government regarding the situation on the ground in Iraq.

We're told that President Bush earlier today met with Defense Secretary Donald Rumsfeld to talk about the developments there. We are also told by White House spokesman Scott McClellan that last Friday the president held a lengthy video conference meeting with members of his national security team to talk about Iraq.

The White House saying that the president looks to his commanders on the ground to make the decisions on military operations. But he does not try to micromanage that process.

And again, though, officials here very carefully emphasizing that two-way discussions are taking place, between the U.S. and the interim Iraqi government. When asked about how successful it can be measured in the Falluja operation, here's what White House spokesman Scott McClellan had to say.

(BEGIN VIDEO CLIP)

MCCLELLAN: The Iraqi government is the one, as I said, who is making the decision about how to address these matters in close consultation with the multinational forces. The terrorists and insurgents rejected a political solution. And now Prime Minister Allawi has made the decision to move forward, institute additional safety measures and to bring to justice those terrorists and insurgents who continue to spread violence and fear.

(END VIDEO CLIP)

QUIJANO: McClellan also adding that the goal really is to stabilize the environment there in order to move ahead with elections, which the U.S. fully expects will happen come January.

Now, one other bit of news we should tell you about, Judy, as the speculation continues here in Washington about who will stay and who will go within the Bush administration.

Less than a week after the election, we have one name now that we can take off of that list, the speculation list. White House spokesman Scott McClellan saying that Andrew Card, the White House chief of staff, was asked by the president to remain on for a second term. He has agreed.

That's so far, Judy, the only name that we know about for sure, Scott McClellan saying that he will not speculate. But Andrew Card to remain as White House chief of staff -- Judy.

WOODRUFF: All right. Elaine Quijano with the second-term watch, thank you very much.

We're going to have more on the offensive in Falluja and how it squares with public opinion about the Iraq war ahead.

Up next, the road ahead for Democrats after a difficult election day. I'll talk with retiring Senator John Breaux about where his party goes from here.

President Bush looks ahead to another four years. Can he avoid the stumbles that struck some previous two-term presidents?

And New Jersey's governor says good-bye. Closing the book on Jim McGreevey's tenure and the unusual circumstances that led to his resignation.

(COMMERCIAL BREAK)

WOODRUFF: These are live pictures coming into CNN from the Detroit area, where a small plane has crashed on the east side of that city this afternoon, hitting at least two houses in a residential neighborhood, starting some fires.

Miraculously, the pilot and a passenger have walked away from this crash. It happened about 2 p.m. Eastern Time. We are told no other injuries so far were reported on the ground.

Again, these pictures coming in as courtesy of CNN affiliate WDIV in Detroit.

We'll be right back with more.

(COMMERCIAL BREAK)

WOODRUFF: Checking the Monday headlines in our "Campaign News Daily."

One potential presidential hopeful in 2008 has delivered a post election speech in New Hampshire. Democrat Howard Dean criticized President Bush and his own party in a speech at Dartmouth College yesterday.

Dean said Mr. Bush ran a campaign on fear, anxiety and hate. And he also said the Democrats should stop moving too far to the political center. Dean declined to say if he plans another run for the White House.

Florida Governor Jeb Bush has denied any interest in running for president and the speculation in his home state may be shifting to a U.S. Senate race. With a victory for Senate candidate Mel Martinez fresh on their minds, the "Fort Lauderdale Sun-Sentinel" reports that some state Republicans want Jeb Bush to take on Democratic Senator Bill Nelson in 2006. However, Governor Bush told the newspaper that he is not interested in the Senate race.

As a Democratic winner in a big state, Illinois, Senator-elect Barack Obama is a hot commodity in his party and on the media airwaves. The "Chicago Sun-Times" reports that Obama plans to capitalize on his popularity by signing a book deal.

A spokesman tells the newspaper that Obama has hired well-known Washington lawyer Robert Barnett to represent him. An autobiography Obama wrote 10 years ago became a best seller after his speech to the Democratic convention.

Well, with Democratic leader Tom Daschle exiting the Senate after his Tuesday defeat, White House spokesman Scott McClellan was asked today if President Bush would regard Senator John Kerry as a top leader among Senate Democrats.

(BEGIN VIDEO CLIP)

MCCLELLAN: The Senate Democrats will determine who their leader is going forward, and the president looks forward to sitting down with those leaders and talking about how we can move together on the priorities for the American people and how we can work together to bridge our differences.

(END VIDEO CLIP)

WOODRUFF: Republicans took over Senate seats in five southern states on Tuesday, including the seat held by retiring Louisiana Democrat John Breaux. Senator Breaux is with me now here in Washington to talk about Tuesday's election and some other things.

Senator Breaux, good to see you.

SEN. JOHN BREAUX (D), LOUISIANA: Nice to see you.

WOODRUFF: So, a clean sweep for the Republicans in the south. How much -- and it's 55-45. How much does that change the Senate?

BREAUX: Well, I think it changes it substantially. They were a little bit closer to having the 60-vote margin that they have, and I would think that they would find some Democrats who would cooperate with them on some big issues.

But they still have to get 60s. They don't have a veto proof or filibuster proof United States Senate yet, so there's going to have to be some crossovers. They're going to have to be working together. Otherwise, you'll have stalemate again.

WOODRUFF: Who are some people that we should be looking to cooperate with the Republicans? Ben Nelson of Nebraska is up in '06?

BREAUX: Well, I think senators who are from moderate, middle of the road, mainstream states are going to have to look for ways in which they can work together for the good of the country and not to be perceived as being too partisan. But you can do that and still be loyal to the Democratic base.

The trick of the Democrats is to maintain our base but also to expand it. Neither party has a base that's large enough to win an election, neither Democrats nor Republicans.

WOODRUFF: But how do the Democrats do that? How do they both cooperate with the president on some of these big issues, big policy questions that are going to be coming before the Congress, and maintain and figure out what their own identity is?

BREAUX: Come up with good ideas. I mean, Bill Clinton did this. Bill Clinton talked about cops on the streets. He talked about balancing the budget, talked about welfare reform. And he was able to be successful in the northeast. He was able to be successful in the deep South. You can do it if you have good ideas.

I mean, this time it seemed like we were running against the Republicans and against God. We can't let them have that advantage.

WOODRUFF: But is it -- is it the message, Senator Breaux, or is it the messenger?

BREAUX: It's both. You have to have the right message, but you also have to deliver it. I mean, going back to Bill Clinton when he won, I mean, he was able to keep the party base, which is a tradition of minorities and labor, but he was also able to expand it into moderate, mainstream individuals.

So he had a good message, good ideas, and he was able to deliver it well. The next Democratic presidential candidate will have to do both of those things if he's going to be successful.

WOODRUFF: What are some names that come to your mind?

BREAUX: Evan Bayh is out there. I mean, I think Hillary Clinton is going to want to run. Either one of those who can articulate a moderate, mainstream message can be successful.

But you can't appeal just to the base. George Bush would not have been elected if he had just got the Republican base in his party. He was able to expand to the center. So the trick is, is to maintain your base and get enough independents, moderate and middle of the roaders in order to win.

WOODRUFF: Would Hillary Clinton be acceptable in the South?

BREAUX: Well, she's going to have to be able to try and articulate that type of message. Her husband certainly did it very well. And if she discusses those campaign ideas, he's going to tell her that I think she has to move towards the center and come up with those type of ideas, but that can be done.

Any candidate who can do both of those things can be successful in the south. You don't have to be from the South to speak Southern. You can come up with ideas that are appealing down there.

WOODRUFF: But are there -- again, on this whole question of Democrats cooperating with the president, whether it's tax cuts, whether it's a constitutional amendment to ban gay marriage, which Karl Rove said yesterday the president is going to continue to push on. Should Democrats cooperate on something like this if they don't agree on it?

BREAUX: Well, you have to come up with different ideas. I would have said look -- I think other would have said the same thing -- let states make that decision. If a state wants to enact a constitutional amendment in their state, they traditionally handle marriage issues, let them do it. And I'll support whatever the state says. That would have been a way to approach the issue in the presidential campaign.

But the whole thing is being able to say that, look, we are a party of faith, as well. Here is how we approach these ideas.

Don't be afraid of talking about these issues. If you don't talk about them, they'll think you're not supportive of good, moral values. I think to a certain extent, that happened.

WOODRUFF: And you're saying John Kerry didn't do that. We need to move quickly. Senator Breaux, your name has already come up as maybe one of those Democrats that President Bush might reach out to for his cabinet. Any conversations?

BREAUX: No, we talked about it four years ago, and I made a decision to stay in the Senate. Of course, I'm not in the Senate now, so -- you know, but we have not had any discussions whatsoever.

WOODRUFF: Would you be interested in serving in a Bush cabinet?

BREAUX: I'd be willing to talk to him about it, but I'm certainly -- I'm not out seeking anything. I mean, I think there's some things that we could certainly work together on, but I'm not seeking anything in a cabinet. And they have not offered me anything or talked about it at all.

WOODRUFF: You plan to stay in Washington?

BREAUX: We're going to stay around here and then divide our time up in Louisiana.

WOODRUFF: All right. Senator John Breaux, it's very good to see you.

BREAUX: Thank you, Judy.

WOODRUFF: We'll stay in touch.

BREAUX: Thank you.

WOODRUFF: Thank you very much. Appreciate it.

A strong election showing by President Bush and other Republicans is giving conservatives high hopes for the next four years, but will they have to come to terms with a second term reality? Ahead, a closer look at why some presidents have struggled after reelection.

(COMMERCIAL BREAK)

WOODRUFF: It is also midnight in Iraq, where U.S. and Iraqi forces are fighting their way into the rebel-held city of Falluja. Coming up, I'll talk with a military analyst about that fighting and what may happen next.

Plus, many on the religious right feel they helped put President Bush over the top in last week's election. So, is it payback time? I'll speak with a Christian conservative about what they expect from the president's second term.

But first let's go live to Wall Street for our own Rhonda Schaffler and an update on the financial markets.

Hi, Rhonda.

(STOCK REPORT)

(COMMERCIAL BREAK)

WOODRUFF: Jim McGreevey set off a political bombshell three months ago when he acknowledged that he is gay and admitted to having a homosexual affair. Today, New Jersey's governor bid farewell, but his departure is just the beginning of what could be next year's hot election.

Welcome back to INSIDE POLITICS. I'm Judy Woodruff in Washington. We're going to have more on today's so-long from the Garden State governor, but first our top story this afternoon.

The U.S. military assault on Falluja in Iraq is well under way. U.S. tanks are advancing on the insurgent stronghold at this hour. CNN's Karl Penhaul is reporting that explosions and heavy exchanges of gunfire are lighting up the night sky. The U.S. military advance was preceded by a heavy artillery barrage, along with aerial bombings by U.S. aircraft.

Huge explosions are also reported inside the city. Those blasts believed to be caused by roadblocks rigged with explosives.

At the Pentagon a short time ago, Defense Secretary Donald Rumsfeld said the Falluja mission would go along way towards securing Iraq.

(BEGIN VIDEO CLIP)

DONALD RUMSFELD, DEFENSE SECRETARY: No government can allow terrorists and foreign fighters to use its soil to attack its people and to attack its government and to intimidate the Iraqi people. Success in Falluja will deal a blow to the terrorists in the country and should move Iraq further away from a future of violence to one of freedom and opportunity for the Iraqi people -- General Myers. (END VIDEO CLIP)

WOODRUFF: And with me now to talk more about the assault on Falluja and the overall mission in Iraq is Michael O'Hanlon, a senior fellow at the Brookings Institution here in Washington.

Just quickly, Michael O'Hanlon, a moment ago, Jamie McIntyre was telling us that at the Pentagon they are also saying that this is just the beginning of an effort to route the insurgents in Iraq. So which is it? I think people are trying to get a handle on what this mean overall in the war.

MICHAEL O'HANLON, BROOKINGS INSTITUTE: Well, Judy, my guess is that the Falluja headquarters for this insurgency is their most important one in the whole country, and that the Pentagon says we maybe have 10,000 to 20,000 foreign terrorists, plus Iraqi insurgents throughout Iraq total, of which up to 5,000 are in Falluja. So this could be a quarter of the total resistance in the entire country, and it's certainly their most important sanctuary. So even though there may be follow-up attacks and there have been previous attacks in places like Samarra, if we get this one right, if could really make a big difference.

WOODRUFF: What is your sense of the risks here? We know they are already reporting four, I believe, is -- was Jamie -- was a report from Karl Penhaul, four U.S. casualties. What should Americans be expecting?

O'HANLON: Well, we could lose dozens of people in this sort of attack. We did back in April, even when it was called off before its completion.

The upside to this, Judy, is we are good at these sort of urban campaigns. We can take cities and we can seize particular targets, attack well-known locations of insurgents. The bad news is we don't necessarily know who the insurgents are. And they can also intersperse themselves among civilians.

So they may slip away, they may try to use innocent people as shields or hostages, and we could wind up causing a lot of public relations harm to our cause even if we wind up killing a number of them. So I am very open-minded about how this is going to turn out, hoping for the best but worried about all the risks.

WOODRUFF: What is your sense -- Jamie McIntyre reported that out of the 10,000 to 15,000 U.S. troops, there are -- I believe he said around 2,000 Iraqis, although there had been some reports of desertions. What is the significance of that?

O'HANLON: Well, that is probably a little higher number than I have seen elsewhere, but it's possible. The real significance, I think, Judy, is whether we can keep Iraqis in charge of this after it's over. Because we're going to have to police Falluja and maintain order there after this raid.

Otherwise, you have the risk of what happened before, where the Iraqis melt away, the insurgents melt away, and then just come back once we leave. Or our presence, which is now not appreciated by the people of Falluja, could be spurred to more attacks.

So what you really want is for the Iraqi security forces to help a little bit right now with this raid, but then to take the primary role after the raid is over in policing the streets. That's where I'm not sure they are even up to that job. So let's hope for the best there, too.

WOODRUFF: Michael O'Hanlon, you were saying to me a moment ago there's some likelihood that a number of these insurgents may just melt away and not fight. What is your sense of that?

O'HANLON: Well, if I were an insurgent I'd have two options. One is to melt away, because obviously I'm not going to be recognized. There isn't that kind of intelligence, and most of the population of Falluja is somewhat sympathetic to my cause.

So I can probably melt away and fight a different day, choose the time and place of the attacks. Or I can try to use a lot of civilians as shields to make sure the Americans have to kill a lot of innocent people even as they go after the insurgents.

So those are the two strategies I believe the insurgents have open to them. And frankly, they are both pretty good strategies. So again, we can certainly achieve a tactical success here, taking back certain neighborhoods, destroying certain buildings, but the overall strategic verdict on this is going to be hard to measure for a long time.

WOODRUFF: You're right. If they melt away, then where do they go from there and where does the U.S. go from there?

O'HANLON: That's right.

WOODRUFF: All right. Michael O'Hanlon, thank you very much at the Brookings Institute. Thank you very much.

O'HANLON: Thank you, Judy.

WOODRUFF: Well, here in Washington, the chief justice, William Rehnquist, was again absent when the Supreme Court convened today. Rehnquist has been working from home while he receives radiation and chemotherapy for thyroid cancer. There was no official update on his health, although there has been speculation that the 80-year-old Nixon appointee may retire soon.

Court watchers say President Bush could have more than one spot to fill on the Supreme Court before the end of his second term. There is a feeling among some analysts that the president is now in a good position to push a conservative agenda on the court, as well as in other areas. But as our Bruce Morton reports, high hopes for second- term presidents sometimes sour quickly.

(BEGIN VIDEOTAPE)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I earned capital in the campaign, political capital. And now I intend to spend it.

BRUCE MORTON, CNN NATIONAL CORRESPONDENT (voice-over): Second- term presidents usually sound like that, confident, men with a mandate, raring to go. It's astonishing how often it goes wrong.

The jinx? Well, Dwight Eisenhower had the U-2 affair, a U.S. spy plane shot down in the Soviet Union. The American pilot survived and confessed. Plus rumors the Soviets union were ahead of the U.S. in missiles. Not true, but it hurt.

Richard Nixon's second term brought Watergate. Resignation to avoid impeachment.

RICHARD M. NIXON, FMR. PRESIDENT OF THE UNITED STATES: I shall resign the presidency effective at noon tomorrow.

MORTON: Ronald Reagan's second term brought Iran Contra, news that the administration sold arms to Iran in exchange for help and freeing U.S. hostages in Lebanon, then used the money to buy arms for anti-government guerrillas in Nicaragua in defiance of a congressional ban.

RONALD REAGAN, FMR. PRESIDENT OF THE UNITED STATES: A few months ago I told the American people I did not trade arms for hostages. My heart and my best intentions still tell me that's true. But the facts and the evidence tell me it is not.

MORTON: Bill Clinton's second term was about a woman named Monica Lewinsky and impeachment.

WILLIAM JEFFERSON CLINTON, FMR. PRESIDENT OF THE UNITED STATES: Indeed, I did have a relationship with Ms. Lewinsky that was not appropriate. In fact, it was wrong.

MORTON: What goes wrong? Often they overreach.

ROBERT DALLEK, PRESIDENTIAL HISTORIAN: They lose their credibility, they lose their power to -- to dominate, to lead. They become lame ducks by the last two years of their second term. The Congress is not going to pay as much attention to them as they did in their first term, or even in the first two years of their second term. And so, conditions work against them.

MORTON: It isn't inevitable, but it is a pattern, partly because people in this very political city are already calculating "What will the ticket be in '08 and how could I be on it?"

Bruce Morton, CNN, Washington.

(END VIDEOTAPE)

WOODRUFF: Republicans add to their Senate majority. But will the president's judicial nominees face an extra hurdle within his own party? Up next, I'll ask a conservative activist about the president's second-term agenda and the potential role of Senator Arlen Specter, who is expected to become chairman of the Judiciary committee. (COMMERCIAL BREAK)

WOODRUFF: For the second time this hour, we are bringing you live pictures of a plane crash, a small plane crash. The first one in Detroit. This one in the suburbs of Atlanta, Georgia.

This plane, we are told, trying to land at Peachtree Dekalb Airport, just outside of Atlanta. So far, there are no reports of fatalities or injuries. But we are trying to get more information. These pictures courtesy of CNN affiliate WAGA. We're trying to get an update both on that crash, as well as the one in Detroit.

We'll be right back.

(COMMERCIAL BREAK)

WOODRUFF: With polls showing that voters cited values as their number one issue in this election, many social conservatives say they see last week's election as a victory for them and their agenda. I spoke just a short time ago with Jan Larue of the group Concerned Women for America. And I began by asking her what a Bush victory means for her and her organization.

(BEGIN VIDEOTAPE)

JAN LARUE, CONCERNED WOMEN FOR AMERICA: Well, very crucial for all of the values that we hold dear and try to represent here in Washington on behalf of all of our constituents. And we certainly concur that the thing that made the difference in this election in securing the reelection of our president is the vote of people who really care about moral values, and that includes issues that the Supreme Court looks at.

WOODRUFF: Well, let's tick off some of the issues that are -- that this president is likely to deal with and ask you what you expect from the president. I mean, just starting at the very top, this proposed constitutional amendment to ban gay marriage, what do you expect from the president on that?

LARUE: Well, the president has reiterated through his chief political adviser over the weekend in every show that I saw that clearly the president intends to back a federal marriage amendment. And of course an amendment doesn't require the president to sign it or anything, but certainly his endorsement is key.

And we expect that he will do that because he and we share a real concern about federal judges, and maybe even some more state judges who would declare that their state law on marriage and even a state constitutional amendment limiting marriage to a man and woman might violate equal protection or liberty under the federal Constitution. Also, we have concerns about the federal Defense of Marriage Act, which is again being challenged in several courts right now. So that's crucial.

WOODRUFF: So that's a priority. What about appointing judges to the Supreme Court, in particular where we know there may be vacancies in this term, who would seek to overturn Roe v. Wade? Is that a priority?

LARUE: Well, we agree with the president when he has said since day one over four years, and also reaffirmed in the debates, that he has one litmus test for judges, and that is whether or not they will set aside their own personal political beliefs and stick to interpreting the law rather than writing it. And we agree with that wholeheartedly. We do not see the Constitution as this living and growing document that so many hold to, but rather that it has a fixed text and the judge's job is to interpret that text.

WOODRUFF: As you are aware, I know Senator Arlen Specter, who is certainly looking at the chairmanship of the Judiciary Committee, said last week in so many words that the president needs to be mindful that there are members of the Senate who might not support a nominee like the one you describe.

LARUE: Yes.

WOODRUFF: Are you going to -- is your organization, Concerned Women for America, going to work to block Specter's -- Senator Specter's move to the chairmanship?

LARUE: Oh, absolutely. We are unequivocally opposed to Arlen Specter chairing that very crucial committee.

I mean, what a gall to on the day that the president accepts his victory to come out with a statement like this. And, you know, this is not an absolute thing for him to chair that committee. You know, the Senate controls its own rules, and the Republican leadership in the Senate could decide that, based on his statements, not only his statement on November 3, but also a 24-year record on his view of the Constitution, which he does hold to be this living and growing document, which sounds more to me like he's describing a fungus than the highest law of the land.

WOODRUFF: So you're saying that's more important than the bloc of so-called security interests?

LARUE: No, I'm saying it's equally as important to those who supported the president because they understand that what judges do effects every issue about which they are concerned. And that's not only the war against terrorism. When you look at some Supreme Court decisions last year, and, you know, the moral values issues in judges because judges effect all those things.

(END VIDEOTAPE)

WOODRUFF: Jan Larue of Concerned Women for America.

We're going to talk more ahead about the future of the Supreme Court and the abortion issue with a senator now figuring squarely in that debate, Republican Arlen Specter.

Did the president receive a mandate for tougher action in Iraq? When INSIDE POLITICS continues, we will put that issue in the "CROSSFIRE" to find out what Bob Novak and Paul Begala thinks. (COMMERCIAL BREAK)

WOODRUFF: Democrat Jim McGreevey wrote a postscript today for his shorter-than-planned tenure as the governor of the state of New Jersey. Three months after he announced that he is gay and resigning, McGreevey spoke of being a changed man who has regrets but also hope.

CNN's Jennifer Michael has more on McGreevey's farewell and New Jersey's political future.

(BEGIN VIDEOTAPE)

(APPLAUSE)

GOV. JIM MCGREEVEY (D), NEW JERSEY: Thank you, my friends.

JENNIFER MICHAEL, CNN CORRESPONDENT (voice-over): In front of hundreds of staffers, friends and political allies, Governor Jim McGreevey delivered the sequel to his bombshell resignation speech. Once again, the New Jersey Democrat spoke in unusually personal terms: a quote-laden reflection on his abbreviated time in office that began with an apology.

MCGREEVEY: I have to begin today with humility by simply saying I'm sorry.

MICHAEL: McGreevey did not dwell on any of the specifics today, but he has acknowledged that his tenure will be remembered first and foremost for this...

MCGREEVEY: I am a gay American.

MICHAEL: McGreevey's announcement three months ago was an unparalleled political moment; a public figure revealing his inner turmoil, spilling his deepest secret on live television. In his farewell address, McGreevey thanked those who stood by them, but McGreevey's critics are quick to note he only came forward when threatened with a sexual harassment suit by former aide Golan Cipel. And they charge his appointment of Cipel to a top homeland security post was just the latest example of his handing out political favors.

MCGREEVEY: To be clear, I am not apologizing for being a gay American, but rather for having let personal feelings impact my decision-making, and for not having had the courage to be open about whom I was.

MICHAEL: McGreevey spent surprisingly little time listing his accomplishments in office. Instead, he talked at some length about bitterness and division in American politics.

MCGREEVEY: We smile in person and then throw each other under the bus when we leave the room. In this context, public service can be reduced to a blood sport.

MICHAEL: When McGreevey actually leaves office one week from today, Senate President Richard Codey takes over as acting governor. Codey hasn't said whether he'll run in 2005 after serving the remainder of McGreevey's term, but New Jersey Senator Jon Corzine is waiting in the wings.

SEN. JON CORZINE (D), NEW JERSEY: I will look seriously in 2005 and whether I think that what I believe is an uncomfortable feeling by the people of New Jersey about how our state government has worked.

MICHAEL: By most accounts, a run for governor now seems even more attractive to Corzine after losses by Democrats around the country on Election Day. But Republicans relish the thought of reclaiming the governor's office in blue state New Jersey.

Among the possible contenders, Brett Schundler, who lost to McGreevey in 2001, and Douglas Forrester, who ran unsuccessfully for the Senate in 2002. As for McGreevey, he reportedly will announce his future plans soon, including some kind of public service.

Jennifer Michael, CNN, reporting.

(END VIDEOTAPE)

WOODRUFF: President Bush promised that he would stay the course in Iraq during his reelection campaign. So did the election results give Mr. Bush a mandate for tougher action?

That sounds like a topic for the hosts of CNN's "CROSSFIRE," Paul Begala and Bob Novak, who join us now live from George Washington University.

Gentlemen, first of all, what is the president's mandate when it comes to Iraq -- Paul.

PAUL BEGALA, CO-HOST, "CROSSFIRE": Well, it's very mixed. He did take his case to Iraq to the American people and he did win. And so, in that sense, yes, he has a mandate.

But at the same time, those very same Americans who gave him an electoral victory on Tuesday -- let me -- I wrote it down here -- 55 percent said they thought the war was going badly, 52 percent said they thought the war had made us less secure. And so I think the American people were trying to tell him they wanted to keep the president, but they wanted a new strategy. Now, maybe today this invasion of Falluja suggests there's a new strategy, but it's even more aggressive than the old strategy.

WOODRUFF: Bob...

ROBERT NOVAK, CO-HOST, "CROSSFIRE": I guess those election returns, Judy, are from the same exit polls that had John Kerry winning in a landslide. So I would take it with a grain of salt.

As a matter of fact, this -- this operation on Falluja was planned to come after the election. There would have been a tremendous uproar if it happened before the election.

But -- so it wasn't a matter of a mandate. And I don't believe any American president needs a mandate for effective military action. The American people always support effective military action. It's the ineffective military action that they don't support. So the test is in -- is how this operation turns out.

WOODRUFF: So you are saying, Bob, no connection between the results of the election and what we see in Falluja other than the fact, as you said, they waited until it's over?

NOVAK: Yes, of course. Now, this -- Judy, this was planned. This was going to go ahead if John Kerry got to be the president-elect.

BEGALA: Well, but that should be commented on. I think Bob is right.

I think that -- well, seven months ago we know that they invaded Falluja for three days and they pulled back. The general on the ground at the time, General Conway, said that he thought that his leadership vacillated and that it made the situation worse in Falluja. And so they put it off until the election.

You know, there's really something extraordinary about timing a military action, using it for political ends. And it seems to me that's -- Bob says, too, that's what the president has done.

NOVAK: I don't see how you can use -- you use it for political ends when he is already reelected. I mean, that -- the problem -- the problem is that if he -- I think this is going to be a very successful operation. Americans, meaning not some liberals around here in Washington in the blue states, but most Americans like military victories.

And this is going -- I will make a prediction. I don't make many predictions on this program. I think it's going to be a military victory. So it will have been a plus for President Bush. And the same people who are saying why did he wait until the election would have said why did he do it before the election.

BEGALA: No, my point is that if it was right to take Falluja, the sooner the better. Because now we've given the enemy seven months to fortify Falluja.

I'm sure Bob is right. We will take Falluja. And thank god we have great courageous young men on the ground who are going to do it.

But those guys are facing tougher odds today because we gave the enemy seven months to prepare after a three-day aborted invasion. They knew we were coming. They've had seven days to -- seven months to fortify their city just for political ends. And I think that's a shame.

WOODRUFF: We're going to have to leave it there. Paul Begala and Bob Novak, we're going to see you both on "CROSSFIRE" at 4:30 Eastern. Thank you very much.

NOVAK: Thank you, Judy.

BEGALA: Thanks, Judy.

WOODRUFF: And with us now on the telephone from just outside Falluja, CNN's Jane Arraf. Jane, we -- do you have an update for us?

JANE ARRAF, CNN BAGHDAD BUREAU CHIEF: Judy, we are on the outskirts still, the northeast side of the city. But other units of Taskforce 22 from the Army's 1st Infantry Division have been moving further in, as far in as 800 meters into the city.

Out here, in between, they have been blowing up railroad tracks to allow them to move further. They've also for more than an hour been detonating a series of booby-traps.

This is what U.S. forces had expected and had feared as they began to move into the city. But there was a series of improvised explosive devices, homemade bombs, laid out in patterns to try to prevent them from moving in. The Army, the units that we're with, have been firing at these with tanks, causing huge explosions.

This is a sector of the city where there are very few civilians. In fact, officials have told us that they believe insurgents have prevented civilians from moving back into this area as they have been rigging up buildings and barriers and almost everything else with these homemade bombs. They are continuing to detonate them, and they are now detonating -- the Army is blowing up railroad tracks to allow them to go further -- Judy.

WOODRUFF: Jane, can you give us any sense of what you expect in the hours to come?

ARRAF: Quite unpredictable right now. But so far, part of it at least is going according to plan, in that the Army was paving the way with its heavy armor for the Marines. It has breached the city at a couple of points, and it does have troops moving forward, as well as Iraqi troops, a very important part of this, moving forward.

Now, this will go on for a long time. It has been going on for hours.

The city is in complete darkness -- electricity has been cut -- apart from fires burning. But oddly, there is a mosque somewhere in the city that is continuing to be able to broadcast "God is greater," and that is carrying to the further reaches of the city. There is still sporadic explosions out here, and the insurgents have been firing.

The unit that we're with believes that they have perhaps killed at least 25 suspected insurgents, but that's out of possibly 2,000 or more insurgents throughout the entire city. This is expected to go on for some time -- Judy.

WOODRUFF: All right. CNN's Jane Arraf, as she said, just on the outskirts of Falluja. But she is reporting on U.S. troops moving inside the city itself. Thank you, Jane, very much.

And again, we are watching developments in Falluja. We will continue to bring them to you just as often as we get them here at CNN from our correspondents.

Coming up, with the chief justice ailing, is a political slugfest over a Supreme Court nominee inevitable? I'll ask Senator Arlen Specter when INSIDE POLITICS continues.

(COMMERCIAL BREAK)

WOODRUFF: It is just before 4:00 on the East. As the markets get set to close on Wall Street, I'm joined by Lou Dobbs in New York with "The Dobbs Report."

Hi, Lou.

LOU DOBBS, "LOU DOBBS TONIGHT": Hi, Judy.

Stocks barely moving today after the big rally that followed President Bush's reelection last week. As the final trades are now being counted, the Dow Jones Industrials up just over three points, approaching a four-point gain on the day. The Nasdaq Composite just barely higher, as well. Trading today light. Very light. Investors looking to Wednesday's Federal Reserve meeting. The Fed is expected to raise interest rates for a fourth time this year. And the dollar today hit another new low against the euro before recovering a bit. Our huge trade deficits are driving the dollar lower and there's no end in sight.

Oil prices today fell again extending the decline of the past two weeks. Crude oil price now just above $49 a barrel.

Disney and Pixar, six for six. Their animated film "The Incredibles" rang up more than $70 million at theaters over the weekend, the second biggest opening for an animated film ever. Disney and Pixar have created six blockbuster animated films together including "Toy Story," "Monsters" and "Finding Nemo." "Finding Nemo" brought in $864 million. But some analysts say "The Incredibles" may not be able to quite match that. Shares of Pixar down 6 percent in fact today. A downgrade there. Pixar has one more film under its current agreement with Disney.

Another investigation into stock trading on Wall Street. Sources tell us that the SEC is investigating as many as a dozen companies on suspicions that they didn't give their customers the best prices for stocks. Some of the biggest names in the industry are under scrutiny. Morgan Stanley, Merrill Lynch, Charles Schwab, Ameritrade, and E*TRADE included. For individual investors the amount lost may be only pennies per trade but given the millions of trades executed each day by brokers the small overcharges could boost the company's bottom line significantly.

Coming up here on CNN at 6:00 p.m. Eastern on "LOU DOBBS TONIGHT" a special report on illegal immigration. The federal government isn't protecting our borders and three million illegal aliens are expected to enter the country this year. But a Pennsylvania district attorney using local law enforcement to protect his community.

(BEGIN VIDEO CLIP) UNIDENTIFIED MALE: The message here in (UNINTELLIGIBLE) is if you come here and you're violating state law by utilizing false I.D.s and other people's Social Security cards, you're going to be arrested.

(END VIDEO CLIP)

DOBBS: Also tonight, House Minority Leader Nancy Pelosi joins me to talk about the future of the Democratic party and the role of the loyal opposition now in Washington. And former White House counsel C. Boyden Gray will join me to give us his perspective on President Bush's historic reelection and possible appointments to the U.S. Supreme Court.

And we being our series this week, "The Bush Agenda." We'll be investigating whether the president will be able to effect dramatic change during his second term. Tonight we take a look at the president's pledge to focus on economic recovery. Now back to Judy Woodruff in Washington -- Judy.

WOODRUFF: Lou, I know you're keeping an eye on the prospects for reforming or overhauling the tax code. What is your sense of the political obstacles here for the president?

DOBBS: Well, like nearly every other item on his agenda, Judy, as you know, the obstacles are significant. But it appears that there's more common ground here than might otherwise be expected. Both Democrats and Republicans alike believe that the Internal Revenue Service code is a mess. It is how they would change, how they would reform it and the devil is always in the details. But there is probably more bipartisan support for that particular idea than any other that the president is articulating.

WOODRUFF: Lou Dobbs. we'll see you at 6:00. Thank you very much. We appreciate it. INSIDE POLITICS continues right now.

(BEGIN VIDEOTAPE)

ANNOUNCER: On the move in Iraq.

PENHAUL: Parts of Falluja are now on fire. A red glow is lighting up the sky.

ANNOUNCER: U.S. forces smash their way into the rebel held city.

Did President Bush win reelection because of Iraq or in spite of Iraq? Our Bill Schneider investigates.

SEN. ARLEN SPECTER (R), PENNSYLVANIA: When you talk about judges who would change the right of the woman to choose and overturn Roe versus Wade, I think that is unlikely.

ANNOUNCER: He's been the senator in the spotlight since those comments last week. Arlen Specter is our guest this hour.

Now, live from Washington, JUDY WOODRUFF'S INSIDE POLITICS. WOODRUFF: Thanks again for joining us. Well, as Washington looks ahead to the possibility of a new addition to the Supreme Court, a possibility, one Republican has become something of a lightning rod on this issue. He joins us now, Senator Arlen Specter, Republican of Pennsylvania who is in line to become chairman of the judiciary committee. First of all, Senator Specter, thank you very much for being with us.

SPECTER: Delighted to be here, Judy. Thanks for the invitation.

WOODRUFF: Well, you appear to be in a whole lot of hot water with certain members of your party who are still angry over what you said last week about the problems the president would face if he nominated a Supreme Court justice who favored overturning Roe versus Wade.

SPECTER: Judy, I was not warning the president of anything. It was misreported. What I was saying was that when you have to have 60 votes in order to cut off debate to have cloture and you have 55 Republicans, that's an issue we have to face. And it is just a political fact of life.

WOODRUFF: Have you heard from, in the storm of criticism and we know now they are actively gearing up to block your move to become chairman, are you able to have a conversation with some of these folks who are really upset with you still?

SPECTER: Sure. I've had a lot of conversations and when I point out to them what the facts are the going gets easier. When I point out to them that I've never had a litmus test, that I voted for Chief Justice Rehnquist to confirm him and that's long after he wrote against Roe v. Wade, that I voted to confirm Justice Scalia and Justice O'Connor and Justice Kennedy and I almost lost my seat, I led the fight to confirm Justice Thomas and I almost lost my seat as a result of it in the United States Senate. And every one of President Bush's nominees I have supported in the committee and on the floor.

Listen, Judy, those are the facts. It so happens that I'm pro choice. The only pro choice Republican on the committee. But I don't make the decisions. I've supported pro life nominees because it is the function of the president to put up qualified people and a senator to support people who are qualified.

WOODRUFF: What is your view on the possibility that Roe versus Wade might be overturned in part or in whole?

SPECTER: Well, I think that it is difficult because it is a longstanding rule and very distant line, Judy.

WOODRUFF: But would it concern you if it were to be overturned in part or in whole?

SPECTER: I am very much opposed to abortion personally. But I don't think it is the government's rule. But when you talk about overturning Roe versus Wade you have to face up to the fact that it was reaffirmed in 1992 by an opinion written by three justices appointed by Republicans. And one of those justices, Justice Anthony Kennedy is very strong pro life and very conservative. And so is Justice O'Connor. The other Justice Souter not quite in the same camp but I think the reality is that it is hard to overturn. But look here. I'm giving you my opinion. Under separation of powers, that's not for me to decide. My rule is to look at what the president does, to give him deference because he's the president. Separation of power says the judiciary committee is supposed to confirm qualified judges and then what the Supreme Court does, that is their function, not my function.

WOODRUFF: But when we hear conservatives, and I interviewed earlier, Jan LaRue of Concerned Women for America, when she says that we need justices who will strictly uphold the letter of the constitution and not interpret it in some way to suit our modern sensibilities in so many words, I'm paraphrasing. In essence she and others are saying we believe that Roe versus Wade should be overturned.

SPECTER: She may be right. And there may be new appointments who will do that. Look here. I think I can help the president...

WOODRUFF: Is that something you can live with?

SPECTER: I believe in the rule of law, Judy. And if the Supreme Court makes a decision, I will abide by what the Supreme Court does.

WOODRUFF: And you're not going to stand in the way of an appointee who would vote to overturn Roe versus Wade?

SPECTER: Absolutely not. And it's not just what I'm saying. I have done it. I have not applied a litmus test. And I voted to confirm pro life judges. Judy, let me give you two Pennsylvania judges who I worked very hard to confirm. Two very conservative judges. Brook Smith (ph) and a man named Mike Fisher who ran for governor and we all knew they are pro life. Let me just finish. It is important. The Democrats opposed them. And I went to the Democrats and persuaded them on the totality of the facts that these were two of President Bush's nominees who ought to be confirmed. They didn't hold my views but they were qualified. And I fought successfully to have them confirmed.

WOODRUFF: But you have some, again, active conservatives who are very upset. Let me just quote to you one thing she said. She said, "I don't" -- in essence, she's not just opposing your move to the chairmanship because of what you said last week. She said: "But also a 24-year record on his view of the constitution which he does hold to be this living and growing document which sounds to me more like he's describing a fungus than the highest law of the land." So in essence it's your record in the Senate that they are objecting to. What do you say to these individuals who are just fiercely opposed to the idea of your succeeding to the chairmanship?

SPECTER: What I'd say to them the facts speak more loudly than those generalizations. And the facts are that I've supported all of President Bush's nominees in committee and on the floor. And I have voted to confirm strict constructionists who are pro-life judges. It is true that I do not believe you can go back to 1868 when you pass the Equal Protection Clause and look to the intent of the Senate when the galleries was segregated. So, if she's saying there that it is not what they intended in 1868 that can carry forward today, it is true -- that there are those modifications. But I don't think anybody would disagree with that.

WOODRUFF: As you sit here today, Senator Specter, how confident are you that you -- that the chairmanship will be yours?

SPECTER: Judy, confidence is a word I do not use. I've been in a lot of elections. I don't take anything for granted. I'm talking to my colleagues. I'm leaving no stone unturned. I have been training for this job for a long time. I have been on the committee for 24 years. I think I can help the president, and I think I can help the country. And that's why I've continued to run for the United States Senate.

WOODRUFF: Senator Arlen Specter joining us this week after the election. Thanks very much.

SPECTER: Nice talking to you, Judy. Thank you.

WOODRUFF: We appreciate it. Congratulations.

SPECTER: Thank you.

WOODRUFF: We appreciate it.

Well, as the assault on Falluja in Iraq continues, what happened to Iraq as a political issue? Up next, we'll have the very latest developments on the fighting in Iraq.

Plus, our Bill Schneider considers the war as one factor in this election with limited effect apparently on the voters.

(COMMERCIAL BREAK)

WOODRUFF: The White House is vowing that insurgents now under attack by U.S. and Iraqi forces in Falluja will be defeated. Ten to 12,000 U.S. troops and about 2,000 Iraqi forces streamed into the city after dark.

A medic in the field tells CNN that four Marines were wounded in one incident. The mission only underscores the challenges ahead for President Bush in his second term, as well as Americans' concerns about the conflict.

But as our senior political analyst Bill Schneider explains, those concerns were not as evident as many expected them to be on Election Day.

(BEGIN VIDEOTAPE)

WILLIAM SCHNEIDER, CNN SR. POLITICAL ANALYST (voice-over): Iraq was supposed to be the driving issue in the presidential election. It wasn't.

When asked to choose the issue that mattered most to them, only 15 percent picked Iraq behind moral values, the economy, and terrorism. Those concerned about Iraq voted overwhelming for John Kerry. Democrats can now debate whether they might have won if they had run more forcefully against the Iraq war.

Iraq was the driving issue behind Howard Dean's campaign for the Democratic nomination.

HOWARD DEAN (D), FMR. PRESIDENTIAL CANDIDATE: The administration launched the war in a wrong way at the wrong time.

SCHNEIDER: In fact, Kerry adopted that view.

SEN. JOHN KERRY, (D-MA), FMR. PRESIDENTIAL CANDIDATE: It's the wrong war in the wrong place at the wrong time.

SCHNEIDER: But President Bush hammered him mercilessly for flip- flopping on the issue. Kerry tried to maximize his differences with Bush on Iraq.

KERRY: I have laid out a different plan because the president's plan is not working.

SCHNEIDER: Bush tried to minimize them.

BUSH: My opponent says he has a plan. Sounds familiar, because it is called the Bush plan.

SCHNEIDER: The result? Iraq was diffused as a voting issue. But the issue didn't go away. Most voters on November 2nd did not think things were going well for the United States in Iraq. Bush did not get reelected because of Iraq. He got reelected in spite of Iraq.

And look at what's happened. A poll taken immediately after Election Day asked people to choose which issue should be the highest priority for Bush's second term. Guess which issue was number one? Iraq.

The pressure is still on President Bush to resolve the Iraq problem as quickly as possible. That is what Bush says he's trying to do.

BUSH: In order for Iraq to be a free country, those who are trying to stop the elections and stop a free society from emerging must be defeated.

(END VIDEOTAPE)

SCHNEIDER (on camera): So, despite Bush's majority, it is hard to read the results of this election as a mandate for his Iraq policy -- Judy?

WOODRUFF: Very interesting looking at those numbers coming out of Election Day and in the poll afterwards. SCHNEIDER: Afterwards.

WOODRUFF: OK. Bill Schneider, thank you very much.

Last week was a tough one for the Democrats, so now the inevitable question: What next? We'll be joined by pair of our regular guests to kick that question around after the break.

(COMMERCIAL BREAK)

After a strong Republican showing in last week's elections, many Democrats are scratching their heads wondering where they go from here. Joining us now to help begin to answer that question are Ron Brownstein of "The Los Angeles Times" and Dan Balz of "The Washington Post."

Dan, to you first. This whole question of what the Republicans did right, what the Democrats did wrong, we're six days out from this election. What more do we know about why this election turned out the way it did?

DAN BALZ, "THE WASHINGTON POST": Well, I think one of the things that we've learned in the past five or six days is that while moral values were certainly an element of George W. Bush's re-election victory, that is not the only answer and it's not the only reason.

I think one of the things the president was able to do was that he was able to poach, in a variety of ways, on some of the turf that is better for Democrats historically. He inched up his margins in a number of groups, among women, among Hispanics. He actually did better than he did last time among people who are less religious rather than more religious.

So he found ways to pick off inch by inch ground that the Democrats had held while securing and deepening what he had in the past.

WOODRUFF: Why was he able to do all this?

RON BROWNSTEIN, "THE LOS ANGELES TIMES": And I think the last thing Dan said there is really in many ways the most important. What I think what happened in this election is two things. The president was able to erode the edges of the Democratic coalition. He didn't really threaten the core of it. Democrats did win 18 of the 20 states, at least, depending on what happens in New Mexico.

Certainly 18 of the 20 states that they won last time. But they were simply unable, Judy, to challenge him where he was strong. If you look at the 29 states that George Bush won in 2000 and again in 2004, in 21 of them John Kerry was held to 43 percent of the vote or less. He simply never got off the runway.

And in the end, that left them with two few -- too little a margin for error as they tried to get to 270. They were contesting, at the very end of this election, only three states that Bush won last time. And you get to the end of October and you're a Democrat and you have to win Ohio, that is a very difficult position to be in.

WOODRUFF: Why weren't the Democrats able to do better on these points, Dan?

BALZ: Well, they certainly tried. At the beginning of this campaign there were people in the Kerry camp who genuinely thought they could expand the map. But I think as they tried they found that they did not have the voice, they did not have the message, they did not have, as James Carville put it earlier today at a breakfast with reporters, they did not have the narrative.

They had a litany of things that Kerry wanted to do but they didn't have a narrative that tied them together and they didn't have a way to reach beyond that traditional base that they were so secure with.

WOODRUFF: What would you add?

BROWNSTEIN: I would add, Judy, that the problem they face is that the Republican hold in the red states is deepening. Not only was President Bush enormously strong and even stronger in those states, but they moved further in a Republican direction in Congress.

If you think of those 29 states that Bush won twice, the Republicans now hold 44 of those 58 Senate seats. And they hold about three-fifths of the House seats in those red states, almost two-thirds of the House seats.

That basically says that unless the Democrats can put more of the map in play, they're going to be at a systematic disadvantage both in the presidential race and in the congressional race.

WOODRUFF: All right. So, Dan, how do they do that?

BALZ: Well, I think one of the things, Judy, is that they have to realize that they are in fact the out-party and the opposition party. The Democrats in a funny way seem to have the worst of both worlds. There are in fact the minority party at this point, but they continue to act somewhat like the Washington party.

I think one of the things they are going to have to do is get out of the Washington mentality and go out into the states and look for fresh faces who can articulate kind of an anti-Republican Washington message that Republicans have been so successful for in their out years and in the way they have come back over the last decade.

WOODRUFF: So is it finding fresh faces, Ron, or tinkering with the message itself?

BROWNSTEIN: I NEVILLE: ink it is both. But it is probably the fresh faces even more important. Look, finding Democrats who can compete in the red states is the long-term answer to both of these problems. In the long run they are probably not going to improve their congressional position in the red states unless they have a presidential nominee and more likely a president who can change the party's image and improve it in places like the South and the Southwest, but especially the South.

You know, if you consider that other than Florida the Democrats did not seriously contest any southern state this time, they effectively conceded 141 Electoral College votes to President Bush, more than half the total he needed. And I think you learned again in October that it is very hard to get to 270, if you do that. Again, if a Democrat is in a situation where they have to win Ohio, that is a very tough place to be.

WOODRUFF: Dan, are there fresh faces out there for the Democrats to discover?

BALZ: Sure there are, Judy. I mean, there are a variety of governors around the country. Governor Vilsack of Iowa who has won in a rural state, Governor Napolitano, Governor Sebelius, Governor Warner of Virginia, there are a number of people, Governor Richardson in New Mexico, a number of governors that they can look to.

And the question really is, will they look to them, will they listen to them and will those governors actually have real answers? I don't think that this is a sort of a simple solution that they have got. It is in many ways a kind of back-to-basics to reexamine who they are and what they are.

But they do have bright and attractive people around the country. The question is how they marshal them together and who -- in a sense in the way that Bill Clinton did when the Democrats were in the wilderness in the '80s, who figures out, who articulates, who digests, who synthesizes, who comes up with that new Democratic message.

BROWNSTEIN: Unless -- I think this election showed the Democrats that unless they can force the Republicans to defend more of their turf, that the Republicans can focus enormous firepower on what Dan talked about, eroding Democratic turf. The amount of time and energy that President Bush was able put on states like Michigan and Pennsylvania, even an increased vote in New Jersey I think is a real warning for the Democrats that unless they can broaden this battlefield, they will continue to be in a defensive and eroding position.

WOODRUFF: We're going to have to leave it there. I have many more questions for both of you, including how much the Democrats should be working with the Republicans. But we're going to save that for the next chat.

Dan Balz of "The Washington Post," Ron Brownstein of "The Los Angeles Times", good to see both of you, gentlemen.

BROWNSTEIN: Thank you.

WOODRUFF: Thank you very much.

BROWNSTEIN: Thanks, Judy.

WOODRUFF: INSIDE POLITICS will be right back.

(COMMERCIAL BREAK)

WOODRUFF: That's it for this Monday after-the-election edition of INSIDE POLITICS. I'm Judy Woodruff. Thank you for joining us. "CROSSFIRE" starts right now.

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