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JUDY WOODRUFF'S INSIDE POLITICS

Questionable Tactic?; Security Questions; Ralph Neas: Counting Every Vote Not Partisan Issue

Aired December 9, 2004 - 15:30   ET

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


KYRA PHILLIPS, CNN ANCHOR: Well, we're just getting word of a stunning upshot to yesterday's spectacle of a U.S. defense secretary under fire from his own troops. A reporter from a Tennessee newspaper who happens to be embedded with some of the GIs attending Donald Rumsfeld's town hall meeting in Kuwait yesterday says he planted that dramatic question about using scrap metal to protect unarmed vehicles.
In an e-mail, reporter Edward Lee Pitts says that he was told before the event, "Only soldiers could ask questions, so I brought two of them along with me as escorts." He goes on, "Beforehand, we worked on questions to ask Rumsfeld about the appalling lack of armor their vehicles going into combat have. While waiting for the VIP, I went and found the sergeant in charge of the microphone for the question-and- answer session and made sure he knew to get my guys out of the crowd."

Pitts says, "I believe lives are at stake with so many soldiers going across the border, riding as scrap metal as protection. And it may be too late for the unit I am with, but hopefully not for those who come after."

Rumsfeld, the Pentagon and President Bush himself have responded to the soldier's complaint and vow to do everything humanly possible to get armor to the troops who need it. Needless to say, we're pursuing reaction to this latest development. You'll hear it first, right here on CNN.

JUDY WOODRUFF'S INSIDE POLITICS is up next.

(BEGIN VIDEOTAPE)

ANNOUNCER: The commander in chief responds to disarming questions from a soldier in Iraq.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: If I were a soldier overseas wanting to defend my country, I'd want to ask the secretary of defense the same question. And that is, are we getting the best we can get us?

ANNOUNCER: Rethinking the third rail. Are politicians really hungry for Social Security reform?

UNIDENTIFIED MALE: Politicians are always looking for a free lunch when it comes to Social Security and, frankly, so is the public.

ANNOUNCER: A New York crime fighter runs for governor with a little help from some famous friends. Now, live from Washington, JUDY WOODRUFF'S INSIDE POLITICS.

(END VIDEOTAPE)

JUDY WOODRUFF, CNN ANCHOR: Thank you for joining us.

We begin with President Bush laying the groundwork for his second term. He nominated Jim Nicholson to replace Anthony Principi as the secretary of Veterans Affairs. And we got word from the White House that the cabinet shuffle is over for now. We have a full report on all that ahead.

Mr. Bush also addressed the monumental second-term challenge of reforming Social Security. But at the same time, he was pressed to confront current questions about resources for U.S. troops in Iraq.

Let's go to the White House now and CNN's Elaine Quijano.

Hello, Elaine.

ELAINE QUIJANO, CNN CORRESPONDENT: Hello to you, Judy. That's right. Good afternoon.

The president specifically was asked to respond to a soldier's question to Defense Secretary Donald Rumsfeld yesterday. The soldier asking about what he believed was inadequate armor for troops heading into Iraq. Well, today, the president responded in general terms, saying that the U.S. was doing everything possible to protect American forces.

(BEGIN VIDEO CLIP)

BUSH: The concerns expressed are being addressed. And that is, we expect our troops to have the best possible equipment. And if I were a soldier oversea wanting to defend my country, I'd want to ask the secretary of defense the same question. And that, is are we getting the best we can get us? And they deserve the best.

(END VIDEO CLIP)

QUIJANO: Now, the president made his comment after a meeting with Social Security trustees here at the White House. Of course the administration has made clear that Social Security reform is a major part of the president's second-term agenda. He would like to see a move towards privatizing at least part of that system, but some estimates put the cost of transitioning into such a system into the trillions of dollars.

Now, while the White House has conceded that short-term borrowing may be necessary to cover that move, the president has said that a number of possible solutions are on the table.

(BEGIN VIDEO CLIP)

BUSH: I will not prejudge any solution. I think it's very important for the first step to be a common understanding of the size of the problem. Now -- and then for members of both parties in both bodies to come together to come and listen to the options available.

(END VIDEO CLIP)

QUIJANO: Now, during the White House briefing, White House spokesman Scott McClellan was hammered on specifics of the Social Security plan. But he did not go into any detail about how the administration plans to pay for such a move. McClellan basically saying that the president has not at this particular point endorsed a specific plan out there, that, in fact, Mr. Bush, as he pointed out, has laid out a general set of principals that he says are quite clear, what he would like to see involved in Social Security reform.

One of those principals being that there would not be any change in benefits for those at or near retirement age. McClellan adding that it was best to get into those kind of detailed discussions not from the briefing podium but directly with members of Congress -- Judy.

WOODRUFF: All right. Elaine, thank you very much. Elaine Quijano at the White House.

Well, politicians have been talking for many years about fixing Social Security. Remember Al Gore's lock box? Our national correspondent, Bruce Morton, looks at the hard slog towards reform and asks whether it's any closer to becoming reality.

(BEGIN VIDEOTAPE)

BRUCE MORTON, CNN NATIONAL CORRESPONDENT (voice-over): Social Security is in trouble. Politicians like South Carolina Senator Lindsay Graham know it.

SEN. LINDSAY GRAHAM (R), SOUTH CAROLINA: Between 2011 and 2030, there will be a 65 percent increase in retirees and an eight percent increase in the workforce. We're short of money to pay the benefits. If we do nothing, the cost will be trillions.

MORTON: Non-politicians like Chelsea Naja (ph) know it too.

UNIDENTIFIED FEMALE: The problem is, is I'm 27 years old. And every week -- every two weeks, I get my paycheck and I see the chunk that goes to Social Security. And what worries me is I'm not going to have that there when I retire.

MORTON: The problem is all those baby boomers rushing toward retirement. But the real problem is that the obvious remedies, raise taxes, cut benefits, raise the retirement age, involve pain. And politicians hate to vote for pain. So can you fix it?

ROBERT BIXBY, THE CONCORD COALITION: What we have is a system that promises far more future benefit than it can afford to deliver. So, somehow, you need to bring the benefit promises in line with the money coming into the system. If you take out benefit cuts, if you take out tax increases, or contribution increases, I don't know how you can get from here to there.

MICHAEL TANNER, CATO INSTITUTE: I think we're closer to Social Security reform than we have ever been.

MORTON: Michael Tanner of the libertarian Cato Institute is optimistic in part because the president wants reform.

BUSH: Reforming Social Security will be a priority of my administration. Obviously...

MORTON: But you still have to get from here to there. Lindsay Graham's plan, for instance, would raise the amount of income on which you pay Social Security tax. But the president is a tax cut man.

BIXBY: Politicians are always looking for a free lunch when it come to Social Security. And, frankly, so is the public.

TANNER: There's no such thing as a free lunch. And any Social Security reform is going to have certain costs involved.

MORTON: Fixing the system will have to hurt, somehow. But not fixing it may hurt worse.

TANNER: In many way, it's like paying off your credit card. You're much better off if you pay them off today, then if you make the minimum payments forever. But you have to come up with that money now, and that's not always the easiest thing to do.

MORTON: And politicians worry about what their opponent will say in the next election.

BIXBY: It's very easy to demagogue this issue, very easy to talk about "they're going to cut your benefits," or "raise your taxes," or "Wall Street's after the money," or something like that. And so politicians have gotten away from having a rational discussion about these things.

MORTON (on camera): Experts disagree over whether Congress and the president will be able to come up with a fix for the system. They do agree that if it happens it will have to happen next year. If the debate spills over into 2006, an election year, reform is almost certainly dead.

Bruce Morton, CNN, Washington.

(END VIDEOTAPE)

WOODRUFF: Thank you, Bruce.

So, has the revolving door to the Bush cabinet room stopped swinging? Still ahead, the unexpected holdovers. How did they beat the exodus expectations game?

Plus, another candidate for DNC chairman? I'll ask Senator Byron Dorgan about his plans and who may be encouraging him to run.

And next, a close encounter in the New York governor's race.

(COMMERCIAL BREAK) WOODRUFF: John Kerry didn't win the job of commander in chief, but he's going to visit the troops in Iraq anyway. Senator Kerry will stop in Iraq next month during a swing through the Middle East.

INSIDE POLITICS will be right back.

(COMMERCIAL BREAK)

WOODRUFF: New York State's attorney general, Eliot Spitzer, made his name as an aggressive prosecutor of white collar crime on Wall Street. Now he's kicking off his campaign for governor with an equally aggressive strategy, staging a major fund-raiser just two days after announcing his candidacy.

CNN's Chris Huntington has more.

(BEGIN VIDEOTAPE)

ELIOT SPITZER, NEW YORK ATTORNEY GENERAL: Thank you.

CHRIS HUNTINGTON, CNN CORRESPONDENT (voice-over): The newly- declared Democratic candidate for governor of New York warmed up the crowd at a $100-a-plate fund-raiser by quoting the instructions from this year's Eliot Spitzer Halloween mask.

SPITZER: It said, "Wear during business hours on Wall Street Monday through Friday."

HUNTINGTON: Spitzer is hitching his campaign to his successful crusade against cronyism and conflicts of interest on Wall Street, in the mutual fund business, and now the insurance industry. In two terms as New York attorney general, Spitzer and his staff have embarrassed many of the major brokerage firms, mutual funds and insurance companies with their own e-mails into changing the way they do business and paying big settlements. Spitzer concedes those tactics might not work in state politics, but that the goals are the same.

SPITZER: We as the Democratic Party need to speak to the core values that I believe we stand for, which is opportunity, integrity, tolerance, a marketplace that provides opportunity to everybody because the rules of transparency and fair deal are enforced. That is what the great names throughout our progressive history have stood for.

HUNTINGTON: Spitzer's campaign says the event raised $2 million and drew 1,100 support, including labor leader and longtime New York Democratic pals, with some star power provided by Miramax chief Harvey Weinstein...

HARVEY WEINSTEIN, EXECUTIVE PRODUCER: I think Eliot's great.

HUNTINGTON: ... and longtime New York resident, actress Glenn Close.

GLENN CLOSE, ACTRESS: I'm here because I'm an American longing for fresh leadership. HUNTINGTON: And that's just what Spitzer promises to deliver.

SPITZER: If we share our vision, our collective strength, dedicate ourselves to our economic understanding, our community -- communal understanding of how accountability and opportunity can be woven together into a fabric that defines the new politics, we will succeed.

(END VIDEOTAPE)

HUNTINGTON: Now, right now, Spitzer is the only candidate for New York governor for the 2006 race. The three-time incumbent, Republican George Pataki, has not said whether he will run again -- Judy.

WOODRUFF: Chris, thank you very much. A lot to watch up there in New York. We appreciate it.

HUNTINGTON: Yes.

WOODRUFF: Thank you.

Well, one Republican who could pose a strong challenge to Eliot Spitzer is the outgoing secretary of state and native New Yorker Colin Powell. Even though Powell has never said he's interested in running, he leads Spitzer in a hypothetical match-up in this poll done by Quinnipiac University. Earlier today, at NATO headquarters in Belgium, Secretary Powell was asked about the poll results.

(BEGIN VIDEO CLIP)

COLIN POWELL, SECRETARY OF STATE: I have no interest in political life. I will not be running for office, even in my believed home state of New York, as flattering as that poll might be.

(END VIDEO CLIP)

WOODRUFF: Secretary of State Powell making that comment.

Turning now to the race for the Democratic National Party chairman. Today on CNN, retiring Democratic Congressman Dick Gephardt praised both Howard Dean and New York businessman Leo Hindery as possible DNC leaders. Meanwhile, House Minority Leader Nancy Pelosi says she and Senate Democratic leader Harry Reid want the next DNC leader to focus not just on the White House, but on congressional and governor's races as well.

With me now from Capitol Hill to talk more about the DNC leadership race is Democratic Senator Byron Dorgan of North Dakota.

Senator Dorgan, thank you very much.

SEN. BYRON DORGAN (D), NORTH DAKOTA: How are you?

WOODRUFF: Are you interested, one of those interested in heading up the Democratic National Committee? DORGAN: Well, I'm chairman of the Democratic Policy Committee here in the Senate. I'm not a candidate for chairman of the Democratic National Committee. I have been talked to about it by a number of folks, and, you know, this is a town of great mentionables. But I don't expect that to happen, frankly.

WOODRUFF: So you're flatly not interested?

DORGAN: No, I just don't expect that I'm going to be chairman of the Democratic National Committee. We have a lot of great candidates out there who aspire to be chairman at this point, and the story that was in the "Roll Call" Magazine today was just one of those other mentionable stories. But I don't expect that to end up happening.

WOODRUFF: Well, in fact, the story indicated that Harry Reid, the Democratic leader in the Senate, talked to you about doing this. Has he talked to you about it?

DORGAN: He has, and others have. But I -- but again, Judy, I don't in the end expect this will happen.

We have a lot good candidates aspired to head this great party. This is a great political party. And just remember, a wartime president got 51 percent of the vote. The Democratic candidate got 48 percent of the vote in the last election.

And when you add the votes for the United States Senate, Democratic Senate candidates got about 2.5 million more votes than Republican Senate candidates got around this country. This a strong, great political party of ours. And while we had a setback this election, we're going to rebuild and do it quickly.

WOODRUFF: Well, who would be the right leader for the Democratic National Committee?

DORGAN: That's a choice for others to make, particularly the state party chairs. We have -- we have a lot of good folks out there. You just mentioned Dick Gephardt leaving, and talking about a couple of the candidates.

We have a lot of good folks who aspire to lead the Democratic National Committee. I think that will play out over the coming weeks. You know, that election isn't in the next week or two. It's some ways away. So we'll have time to talk about that.

WOODRUFF: Well, let me just throw out a couple of names. What about Howard Dean? Would he be acceptable to you?

DORGAN: Well, look, Howard Dean is someone on the national stage that ran a campaign for the presidency, that excited a lot of people early on. There are many others out there as well. I know that some have announced, some have not announced. But we're a party that is rich and deep in talent, in my judgment.

WOODRUFF: What sort of leadership does the party need right now? I mean, you know, a lot of talk about whether it should be red state, blue state. You come from a very red state. George Bush got, what, 63 percent of the vote...

DORGAN: He did.

WOODRUFF: ... in North Dakota in November. What do you think the party needs?

DORGAN: Well, I got 68 percent of the vote in North Dakota in November, just as an observation. And the point of that is this: in a state that President Bush carried with a very large margin, a Democratic Senate candidate got a much larger margin.

We ought not to give up on red states before the election begins. And that's -- I mean, part of my plea to the party has been, let's not divide this country into red and blue states. Let's see national elections for a change.

You know, we -- what happens is, our presidential candidates have not shown up in a lot of the states because they give them up. Both sides do it, but it's the wrong thing to do.

We ought to compete and contest aggressively in every state in this nation, and that includes red states. Democrats can reach out and can win in red states. But voters need to see you and hear you and be able to take your measure.

We stand for a lot of good thing, Judy. You know that. And, you know, whether it's jobs, Social Security, or health care, we stand for a lot of good things. And we're going to come roaring back.

WOODRUFF: Senator Byron Dorgan, sounding optimistic. Senator Dorgan of North Dakota. Thank you very much.

DORGAN: Thanks, Judy.

WOODRUFF: We appreciate it.

More on the DNC chairmanship ahead. And find out who is essentially saying "Show me the money." It's all inside Bob Novak's notebook next.

(COMMERCIAL BREAK)

WOODRUFF: Bob Novak joins us now with some "Inside Buzz."

All right. I understand you've been looking at this intelligence reform legislation and figuring out who the winners and losers are.

ROBERT NOVAK, CO-HOST, "CROSSFIRE": Some people think that Jim Sensenbrenner, the chairman of the Judiciary Committee, House Judiciary Committee, was a loser because he didn't get his immigration stuff in. But talking to people on the Hill, they think he was a big winner.

At the age of 63, after -- in his 13th term, he got some national publicity for the first time. People know who he is. But what's important is, he's going to get that immigration stuff on the floor next year.

And by the way, I think Speaker Hastert was a big winner, too. A lot of people in the House thought he was crazy to bring it up in the lame duck session, but he got it through and he put his imprint on it.

WOODRUFF: All right. Let's move to the -- to the Democratic Party. The state Democratic chairs meeting tomorrow in Orlando. When we talked to you earlier this week, you mentioned former Michigan governor, Jim Blanchard. What else are you hearing?

NOVAK: I -- they don't want Howard Dean the chairman. That is what they really don't want. They think this would be a disaster. And that's -- it's a "stop Dean" situation.

There's a lot of possibilities. Former mayor of Dallas, Ron Kirk; former mayor of -- of Denver, Wellington Webb; former congressman of Texas, Martin Frost; and, of course, Jim Blanchard. I think Blanchard has a lot of support.

Leo Hindery, who is a New York businessman, a lot of people talking about bring him in as a number two, sort of technical stuff, raising money. But it's going to be interesting to see if -- if they can stop Dean.

WOODRUFF: Well, we noticed that Senator Dorgan all but took himself out of it a minute ago. He didn't completely shut the door.

What else is going on in the Senate? The majority leader, Bill Frist, what has he been up to, and what's the reaction?

NOVAK: Well, this is the meaner Bill Frist, not such a sweetie pie anymore. He wants two-thirds of the budget for the Republicans, even though the Republicans only had 55 percent of the vote. And the Democrats are apoplectic out of this, because they would lose 80 staffers under that -- under that rubric.

Now, in the last Congress, the Republicans had 51 votes, they had about 51 percent of the budget. Now they have 55 votes, and they want 67 percent of the budget.

So -- but I think Bill Frist, who's running for president, has shown he is a tough guy and wants to get more than his share.

WOODRUFF: So is he going to get away with it?

NOVAK: We'll see. I don't know.

WOODRUFF: Finally, Mr. -- Senator Nelson of Florida, what are you hearing about that race? He's up in '06.

NOVAK: Bill Nelson is a -- considered a moderate liberal. But, as you know, the four Democratic seats in the South went Republican in the last election. And he is in danger.

Now, the good news for Bill Nelson is Jeb Bush. The most popular Floridian, the governor, has taken himself out of the race. But the Republican strategists here in town that I'm talking to think the strongest candidate against Bill Nelson is Katherine Harris.

Remember Katherine Harris? And she's...

WOODRUFF: We won't forget her.

NOVAK: We won't forget her. She was -- she had a reputation as a vampire or something when she was secretary of state, and got involved in the recount in 2000. That was a long time ago, Judy.

She's been a noncontroversial congresswoman. And they think that she would really be a very good candidate against Bill Nelson. That would be an interesting race to see.

WOODRUFF: It surely would. All right. Bob Novak, "Inside -- Inside Buzz." We appreciate it. Thank you very much.

NOVAK: Thank you.

WOODRUFF: Memories of Florida, speaking of Florida, weighed heavily on the '04 election. Coming up, did this year's voting really go that much better than it did four years ago? We're going to talk about problems and possible solutions.

Plus, what drove Al Sharpton to campaign for John Kerry?

More INSIDE POLITICS ahead.

(COMMERCIAL BREAK)

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

Hello, Lou.

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

Stocks moving higher today. The Dow Jones industrials earlier in the session had been down 75 points. But a rally, and as the final trades are now being counted, the Dow is up just over 54 points.

The Nasdaq is one and two-thirds percent higher, almost 2 percent higher on the day. Oil prices also higher, unfortunately, up 59 cents a barrel.

OPEC is set to meet tomorrow. Several of the cartel members are warning that they want to cut production and raise their product price range. But the Saudi Arabian oil minister says we may not need to do that, and he usually gets what he wants.

General Motors is cutting 12,000 jobs in Europe over the next two years. Most of those cuts in Germany, where wages are high. But General Motors has worked a deal to make most of those job cuts voluntary, offering buyouts, and some of them worth as much as $280,000. General Motors is battling to overcome weak sales in the United States and around the world. The securities industry trying to head off critics who say it stands to make a windfall if Social Security contributions are privatized. An industry trade group claims that contrary to popular belief, Wall Street firms won't benefit greatly but will only realize what it calls modest gains from private accounts.

Earlier in the day, President Bush reassured us that there will be no increases in payroll taxes to pay for an overhaul of Social Security.

Coffee prices going up. Industry leader Folgers raising prices 14 percent. It's usually the case that other coffee makers follow the lead of Folgers.

Coming up tonight on CNN at 6:00 p.m. Eastern on "LOU DOBBS TONIGHT" our service men and women stationed in Iraq and Afghanistan are complaining that thousands of vehicles used by our troops don't have the necessary armor to protect them from roadside bomb attacks. We are looking into what the Pentagon is doing about it.

(BEGIN VIDEO CLIP)

LT. GEN. STEVEN WHITCOMB, 3RD ARMY COMMANDER: I don't need to tell you how serious we take this. I look at the casualty reports every day. I look at how soldiers were injured. We look at that. We look at and talk to soldiers in hospitals. So we understand that none of us wants to send a young man or woman into harm's way without the adequate protection.

(END VIDEO CLIP)

DOBBS: We'll have a special report on whether the Pentagon is doing enough for the men and women it's putting in combat.

Also I'll talk with Congressman Gene Taylor of the House armed services committee. He says the Pentagon needs to do far more for our troops. Congressman Ernest Istook will also be my guest. He says the efforts by the Department of Homeland Security to create a national database of terrorist targets is a joke.

And we continue with our series of special reports tonight. Culture in decline. Tonight looking at why reality television shows that advocate plastic surgery and wife swapping have become so popular and whether they reflect the real United States. All of that and more tonight at 6:00 p.m. on CNN. Join us. Now back to Judy Woodruff in Washington.

WOODRUFF: Lou, we are spending a lot of time talking today about the president's plans to reform Social Security. He is now saying that he would not raise the payroll tax to pay for the change. But this is an expensive proposition. What are his other options?

DOBBS: Well, there are a number of options. I think the first thing though that everyone needs to do in my opinion is step back and say is any change in this system necessary right now? Most of the experts with whom I have talked, most of the analysis that I've gone through shows a problem that is 30 years to 40 years distant. The fact is that there are only two things that can really happen here, that is change some of the assumptions within the internal mechanics of the program or raise taxes or lower benefits and eligibility ages. All of those will have to be considered and will be considered, frankly. But this is something that should not be thrown into a national agenda and dealt with in one session of Congress. It's going to require a lot of thought, it will take several years, and it will have to be carefully done if we are to have responsible government policy on this.

WOODRUFF: Well, we are all watching to see what the administration does or does not do on it. Lou, thank you very much. See you at 6:00.

DOBBS: Thanks.

WOODRUFF: INSIDE POLITICS continues right now.

(BEGIN VIDEOTAPE)

ANNOUNCER: The final steps in the Bush cabinet shuffle.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Jim Nicholson is a patriot, a man of deep conviction who has answered his country's call many times.

ANNOUNCER: Who's coming, who's going, and who's staying after all?

The same-sex marriage debate. Did the '04 election convince gay rights groups to back off?

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

(END VIDEOTAPE)

WOODRUFF: Welcome back. For the second time in two days, the Washington rumor mill has been proven wrong. We learned today that Transportation Secretary Norman Mineta is staying in the Bush cabinet despite speculation to the contrary. He will serve with Treasury Secretary John Snow who defied the "he's on his way out" buzz yesterday.

White House correspondent Dana Bash has more on some of the final moves in the Bush cabinet shuffle and what comes next.

(BEGIN VIDEOTAPE)

DANA BASH, CNN WHITE HOUSE CORRESPONDENT (voice-over): In the Roosevelt room of the White House, some familiar choreography. The president approaches the podium and introduces a second-term cabinet pick.

BUSH: I'm pleased to announce my nomination of Ambassador Jim Nicholson to be the secretary of veterans affairs. BASH: Nicholson, a bronze star winner and West Point graduate is Mr. Bush's ambassador to the Vatican and the latest valued first-term player promoted. The White House also said the cabinet's only Democrat Transportation Secretary Norman Mineta will remain in his post and three others will stay put, too. Interior Secretary Gale Norton, Housing Secretary Alphonso Jackson and Labor Secretary Elaine Chao. Even Treasury Secretary John Snow, whom administration officials privately suggested would go, is staying for now.

With the president's team coming into sharper focus, he shifts from picking personnel to tackling massive policy changes like reforming Social Security.

BUSH: We will not raise payroll taxes to solve this problem.

BASH: A no new tax pledge even though some congressional Republicans say the president should be open minded about how to fund transforming Social Security. How Mr. Bush will pay for what he calls the program's $11 trillion liability remains just one key unanswered question. Despite saying he won't prejudge a solution, Mr. Bush renewed a campaign promise not to cut benefits for retirees but did hint some would have to sacrifice.

BUSH: The question is does this country have the will to address the problem? I think it must. I think we have a responsibility to solve problems before they become acute.

(END VIDEOTAPE)

BASH: So there are still a lot of questions, not that many answers as the president begins to look at this. So far the president has only been specific about his desire, we heard during the campaign, to create private retirement accounts for younger workers, and some estimate that could be $2 trillion. Earlier this week, the White House admitted they will likely have to borrow to pay for the transition costs for that idea.

WOODRUFF: Dana, two quick questions. First of all if there is no hike in the payroll tax, what happens to the deficit?

BASH: That's the key question. Talking to some Republicans even they are saying that they think the deficit is still very, very important. The president and his team have vowed to cut the deficit, which is nearly $5 trillion in half in the next five years. That is something that some say by doing this, borrowing it all from Social Security will make impossible, that many Republicans in Mr. Bush's own party say is the most paramount thing to focus on.

WOODRUFF: And second, you said John Snow staying for now. Anything we should read into that?

BASH: You know, that is still another very intriguing question. The White House obviously yesterday, as we reported, said John Snow will be staying. Did not give a time frame. They don't do that for any members of the cabinet. But, there has been some speculation, if you will, that perhaps he will stay just to the beginning of the administration, the beginning of the second term maybe six months or so. But everything is up in the air at this point. But the White House is saying he is welcomed in the second term and he accepted.

WOODRUFF: We will be watching along with you. Thank you very much.

BASH: Thank you.

WOODRUFF: A political lightning rod during the president's first term is calling it quits. Judge Charles Pickering today announced that he is retiring one month before his controversial recess appointment to a federal appeals court is due to expire. The president made the appointment after Democrats, who accused Pickering of racism, filibustered his nomination. An emotional Pickering lashed out at his Democratic opponents today calling them intolerant.

Checking our political bites as we call them this Thursday the Democratic National Committee paid travel and consulting fees to the Reverend Al Sharpton to cover his efforts on behalf of John Kerry during the presidential campaign. The Associated Press reports that Sharpton was paid more than $86,000. The only former Kerry rival to receive DNC payments. Sharpton tells the Associated Press he traveled to more than 20 cities to campaign for Kerry saying, quote, "what am I supposed to do? Donate the cost of airfare?"

The hand recount is well under way in the race for Washington state governor. Four counties have already finished their recounts resulting in a net gain of four votes in favor of Republican Dino Rossi over Democrat Christine Gregoire. 35 counties are still counting. A machine recount gave Rossi a 42-vote edge over Gregoire out of more than 2.8 million ballots cast. The state supreme court holds a hearing Monday on a request by Democrats to count ballots that were invalidated in the earlier recount.

There are other unanswered questions about the 2004 vote. Up next, is it a myth that the November election ran relatively smoothly? I will talk with a political activist who says yes.

Plus clashing over the future of the DNC. Donna Brazile and Bay Buchanan will take on the campaign for party chairman.

(COMMERCIAL BREAK)

WOODRUFF: Some activists on the political left say the conventional wisdom that Election Day was free of major problems at the polls is simply false. People for the American Way is among the groups collecting reports of ballot box complaints. Ralph Neas is the group's president and he joins me here in Washington.

Ralph Neas, thank you very much for coming by. People for the American Way is part of a larger group called the Election Protection Coalition doing some looking into what happened on Election Day. What are you finding?

RALPH NEAS, PEOPLE FOR THE AMERICAN WAY: Well, the good news is that so many Republicans and Democrats and independents turned out, and so many tens of thousands of citizens were part of Election Protection and it made it better for millions of Americans.

The bad news is there's a whitewash going on with respect to what actually happened on November 2nd because there were many, many Americans who were disenfranchised, voter suppression, voter intimidation, absentee ballot problems, provisional ballot problems. The thing that we are finding out the most in our "Shattered Myth" report, that we put out with the NAACP and the Lawyers Committee, is these long lines could be very much attributable to there not being enough machines in the urban poor areas or faulty machines.

If this is true, if there's for example one machine for every 200 African-Americans or Latinos and one machine for every 100 or so people in the suburbs, that means there could be an equal protection argument. We could be going to court, suing the state of Ohio for suppressing the urban vote.

WOODRUFF: You are talking about problems that disadvantaged the Democrats, disadvantaged John Kerry, is that right?

NEAS: Actually, these could be problems that disadvantage many others in addition to Democrats. We have 40,000 incidents reported, and we were only in 2 or 3 precincts across the country. This is just the tip of the iceberg. There's no question however there's a pattern that the Ken Blackwells and the Jeb Bushes and the Linda Hoods were responsible for more of this voter suppression than elsewhere throughout the country. But it was a national problem but primarily with respect to unfortunately certain Republican state officials.

WOODRUFF: And this study or investigation is going to continue. You just put out preliminary findings. Ralph Neas, how do you address, though, the criticism that this appears to be a partisan vendetta, a purely partisan effort to call into question the results of November 2nd?

NEAS: Again. I'm not sure when we look and make sure that every vote that has been counted there's going to be any difference in the election. We are nonpartisan. We represent the people of the United States. We want every Republican, every Democrat and every independent to have access to the ballot box and to have that vote count. That's our only mission. It is not a partisan mission.

WOODRUFF: But you still have that perception. Let me just ask you about something, there's a Republican Congressman, Bob Ney of Ohio, who is now calling -- who says his committee, the House Administration Committee, is going to hold bipartisan hearings in the new year to look at the management of federal elections. Is that something you welcome?

NEAS: Absolutely. We would hope that the Republicans and the Democrats at the national level and at the state and local level will do something about it. We have got to be the model democracy, not be the model of hypocrisy. Whether you are in the Ukraine or in the United States, you have a right to vote and that vote should count.

If we could have a bipartisan measure that would address the problems, that would provide uniform standards, that would make sure that there is an equal distribution of resources throughout the United States and within these states, that would be tremendously helpful. It would be helpful to have voter verified audit trails so that we don't have these questions regarding electronic voting machines.

WOODRUFF: But again, you are not calling for an overturning of the election result.

NEAS: No, no, we are calling to make sure that every vote is counted. That's our mission. We want to help Republicans, Democrats and independents.

WOODRUFF: Ralph Neas, People for the American Way, thank you very much. It's good to see you. We appreciate you coming by.

NEAS: It's great to be back, thanks, Judy.

WOODRUFF: Thank you.

In this year's election there was evidence that the gay marriage issue worked against Democrats. Up next, what tack should gay rights groups take now?

(COMMERCIAL BREAK)

WOODRUFF: There was a landmark ruling today from Canada's supreme court in favor of gay marriage. The court cleared the way for the Canadian government to redefine marriage to include same-sex couples. Paul Martin says his government will introduce a gay marriage bill in parliament soon. With this ruling, Canada's political fight over gay marriage apparently is ending much differently from the recent debate here in the United States.

With me now, Bay Buchanan, president of American Cause. And in Orlando, former Gore campaign manager, Donna Brazile.

Donna, this decision by the court in Canada and what is expected to be a change in the law there, will that have bearing here in the U.S.?

DONNA BRAZILE, DEMOCRATIC STRATEGIST: Probably not in the short- term or perhaps even in the mid-term. But I'll tell you what, what is happening here is the gay and lesbian community has decided to shift their tactics and their strategy, focus on individual needs for gay and lesbian couples. They have decided to really go back to educating the public about benefits, and just what full equality would mean in this country.

WOODRUFF: Is that a good move -- a smart move, I should say, on their part, Bay?

BAY BUCHANAN, CNN CONTRIBUTOR: It's very smart. Basically what has happened by their focus on gay marriage, they have energized social conservatives so that now we have 17 states with an amendment that forbids gay marriage, we are going to have 25 in the next couple of years, so it's moving in our direction. And it really gave reason for millions of Americans to get out and to vote to stop any kind of movement towards a more permissive society than we have today. And that has hurt the Democrats and it has hurt the gay movement, I believe.

WOODRUFF: And yet, Donna, today in The New York Times, a professor at the University of Chicago is quoted as saying it is inescapable, he said, that marriage is the central issue facing the gay movement now and given the strength of the right wing, he says there is no way the movement can run away from it.

BRAZILE: Well, Judy, perhaps there are other ways to get at the same goal, which is equality. And I think what the gay and lesbian community will have to do in the coming years is to begin to educate the population about the needs -- and the individual needs of gay families. And perhaps it's time to go back to the basics. And that's what the human rights campaign will do along with their other allies.

BUCHANAN: Judy, the professor is absolutely correct. You have it on the table now. You have it discussing -- you have a national amendment being proposed here in Congress. So the national debate will be gay marriage. And the Democrats are going to have to take a stand one way or the other. And when they...

(CROSSTALK)

BUCHANAN: ... it hurts them.

BRAZILE: Bay, we have taken a stand. The problem is, is that we are not going to develop wedge issues to win elections.

BUCHANAN: Well, the problem is you are being defined as a party. And you're right, Donna, there's no question a lot of the Democratic leaders are not for gay marriage, but you have been defined as the party that is for it because inside your party is the group that is pushing it. And therefore it is damaging to the party as a whole.

BRAZILE: Well, we have a big tent. And we're not about to shrink our tent to allow some bigots to have their day and public opinion. This is an issue that is about equality for all Americans, and we are against discrimination against anybody.

WOODRUFF: Let's talk right now about the -- speaking of the Democratic Party, about the race for the chair of the party. Donna, you're down in Orlando where the state party chairs are meeting tomorrow. What are you picking up down there about the chairmanship run?

BRAZILE: Well, you know, the winning team gets to go back to the White House and the losing team gets to come to Disney World. So what I'm hearing down here is of course people are very excited that we have really a bunch of talented men -- right now, only men, who are seeking the chairmanship of the party.

We are going to hear from all of them. They are going to outline their platform. We know the party is under construction but we are waiting for new management because this is a great party. A lot of great resources. Great, talented people. And we are ready to get back out there, roll up our sleeves and give those Republicans a fight.

WOODRUFF: Well, we know that women really have no place in politics -- just kidding.

(LAUGHTER)

WOODRUFF: Bay, as you watch the contest from your side of the street, is there something -- advice -- is there advice you would give the Democrats?

BUCHANAN: There's no question there's advice because right now, as I said, they are -- they have been defined as a party that's very socially liberal and anti-war. That's what the association is. And as long as that stands, they will lose. So I think they need a leader who is much more neutral and a nationally prominent person, articulate who can voice a lot of middle America's problems and concerns and is not identified with the left wing of their party. If it is Hollywood and Michael Moore, if it's Hillary and the gay rights movement, they will continue to become a less and less significant party.

BRAZILE: Well...

WOODRUFF: So Donna, does that -- go ahead, does that sound like a description of Howard Dean?

BRAZILE: No, I don't think so. Look, I think what we are trying to find is a leader of our team, a quarterback who will lead a great team on the political battlefields ahead. This is not about choosing one leader. We have many, many distinguished leaders of our party in the House and the Senate, of course, in state houses across the country. And what we are looking for now is somebody who can keep this party unified and energized and prepare this party for elections next year.

BUCHANAN: I could help out if I flew down there and nominated Donna Brazile. And then we'd have a woman and somebody who could really do quite well for them I believe.

BRAZILE: Well, I took my hat out of the ring, as they say. Thank you, Bay, but come on down, Minnie is a good person as well as Mickey.

WOODRUFF: Donna did take her hat out of the ring. And we did report that. Thank you very much. But Donna, we are going to try to pin you down on what is going on after this meeting, thank you very much.

BRAZILE: Will do, thank you.

WOODRUFF: Donna Brazile, Bay Buchanan. INSIDE POLITICS will be right back.

(COMMERCIAL BREAK) (BEGIN VIDEO CLIP)

SEN. JOHN EDWARDS (D-NC), FMR. V.P. CANDIDATE: I don't know. That's a decision we'll have to make down the road. And we have got other priorities right now.

LARRY KING, HOST, "LARRY KING LIVE": Would you like him too, Elizabeth?

ELIZABETH EDWARDS, WIFE OF JOHN EDWARDS: I think that he is a unique and powerful voice. And I think that it's a voice we need on the national stage. So I'm glad that he's going to continue to be involved, continue the conversation he has been having with America over the past four years, and I hope he'll be having that in the future.

KING: So if he ran for president again he would have your full support?

E. EDWARDS: Whatever he chooses to do, he's going to have my full support.

(END VIDEO CLIP)

WOODRUFF: You can hear more from John and Elizabeth Edwards about politics and about her battle against breast cancer on "LARRY KING LIVE" tonight at 9:00 Eastern. That interview taped today.

Well, that's it for this Thursday's edition of INSIDE POLITICS. I'm Judy Woodruff. Thanks for joining us. "CROSSFIRE" starts right now.

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


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