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JUDY WOODRUFF'S INSIDE POLITICS

Celebrex Concerns Raise Questions about FDA Approval Process; Intelligence Bill Signed, Much Work Ahead; Rumsfeld Faces Criticism

Aired December 17, 2004 - 15:30   ET

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


(BEGIN VIDEOTAPE)
ANNOUNCER: Risky business: a new warning about a popular painkiller raises questions about government oversight.

UNIDENTIFIED MALE: The watchdogs have been drugged here.

ANNOUNCER: Signed into law: will intelligence reform really make the country more secure?

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: It will enable us to better do our duty, which is to protect the American people.

ANNOUNCER: 'Tis the season to see red. But some Democrats are urging shoppers to buy blue.

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

(END VIDEOTAPE)

JUDY WOODRUFF, HOST: Thank you for joining us.

We begin with new concerns about the widely prescribed painkiller Celebrex.

Today's announcement that the drug may increase a patient's risk of heart problems is an important health story. But it is also a political story, because now even more people are questioning whether the Food and Drug Administration is doing its job.

(BEGIN VIDEOTAPE)

WOODRUFF (voice-over): Vioxx, now Celebrex, both popular drugs promising relief for arthritis suffers.

UNIDENTIFIED FEMALE: With Celebrex, I can line up my putt.

WOODRUFF: Both now found to possibly increase the risk of heart attacks and stroke. Pharmaceutical giant Merck yanked Vioxx off pharmacy shelves in September.

Pfizer, which today revealed information about the stepped up Celebrex risk, says it has no plans to pull that drug off the market.

The Vioxx/Celebrex disclosures have put new scrutiny on the Food and Drug Administration, tasked with ensuring that prescription drugs pass the safety test.

DR. DAVID GRAHAM, FDA SCIENTIST: FDA is more interested in serving its business clients than it is from protecting the American public from unsafe drugs.

WOODRUFF: The Vioxx recall prompted Senate hearings in November.

SEN. CHARLES GRASSLEY (R), IOWA: Danger signals were ignored.

WOODRUFF: Lawmakers are exploring charges the FDA caters to drug companies, rushes new drugs into the marketplace and fails to review the effects of those already available to consumers.

GRASSLEY: When the FDA approves a drug, it's considered a good housekeeping seal of approval. However, what's come to light about Vioxx since September 30 makes people wonder if the FDA has lost its way when it comes to make sure that drugs are safe.

WOODRUFF: FDA officials insist they are on top of the situation.

DR. SANDRA KWEDER, FDA: FDA has a strong drug safety program to assess adverse events.

WOODRUFF: One proposal, form a new board, specifically to evaluate drugs which have already won the FDA's seal of approval. Create a little distance between the big drug companies and politicians who have benefited from their campaign contributions.

That relationship embodied by retiring Republican congressman Billy Tauzin, who helped to broker the new Medicare drug law and is now becoming the chief lobbyist for drug manufacturers.

(END VIDEOTAPE)

WOODRUFF: We are joined now by the chairman and CEO of Pfizer, Hank McKinnell. He is at the company's New York headquarters.

Mr. McKinnell, thank for talking with us.

HANK MCKINNELL, CEO, PFIZER: Judy, good to be with you.

WOODRUFF: Did Pfizer have any reason to believe there was a heart risk associated with Celebrex before this study that just came out?

MCKINNELL: Well, when Vioxx was withdrawn on September 30, we asked the data safety monitoring board three long-term high dose studies to bring in cardiovascular specialists to look specifically at the cardiovascular safety of Celebrex in these very high dose very long term cancer trials.

What we announced today has been missed, I think, in the media. We announced that one of these studies was reviewed by this group of specialists. And they found the risk with Celebrex was no greater than the risk with placebo. The same group of specialists then looked at the second study, which was done at 400 milligrams and 800 milligrams, contrasted with the typical osteoarthritis dose of 100 or 200 milligrams. And they did find an elevated cardiovascular risk.

The company received this information about 5 p.m. last night. I first heard it -- heard about it about 8 p.m. last night.

WOODRUFF: Well...

MCKINNELL: We advised the Food and Drug Administration immediately. And we announced this morning information that we thought was important to prescribing fissions and to patients benefiting from Celebrex.

WOODRUFF: And I was simply asking was this the first indication you had. And you're answering yes, this was the first time.

But since there is this one study showing a greater risk of heart -- of major heart problems, a two and a half times greater risk, why not take Celebrex off the market?

MCKINNELL: Well, any decision to remove a drug has to be made in the context of everything that you know about that drug. The benefits this brings to patients, the medical alternatives, the medical need, and on the safety side, the total context of studies.

This is one study of three that we reported on. The other two appear to be just fine. And it also contrasts with what we know from a very large body done by -- of information done by ourselves and others, which does document the cardiovascular safety profile of Celebrex.

This was an unexpected result. It's important. It's from a large well controlled study. And we haven't yet figured out its relevance to -- to the patient taking Celebrex for arthritis.

WOODRUFF: So in the meantime, how can you be sure consumers that take Celebrex are safe?

MCKINNELL: Well, I think what we know at this point is that consumers taking Celebrex at 800 milligrams, which is four to eight times the recommended dose, should not be continuing.

And we have discontinued the dosing of patients in the study. The study itself is continuing. We discontinued the dosing.

We do know from a wealth of other information, some from FDA studies, some from our studies, some from others, that Celebrex, when taken as recommended at the doses recommended, is safe and effective.

WOODRUFF: You know, as you know, Mr. McKinnell, there's also a finger being pointed today at the Food and Drug Administration. People making the point that there's more of an emphasis now at the FDA on approving new drugs than there is on assuring the safety of drugs that do get approved and including after they are approved. Is that a problem at FDA?

MCKINNELL: Well, there's two problems at the FDA. No. 1, they haven't been give the resources by Congress to fill their mandate, which is the speedy approval of drugs that are needed by Americans.

And they also don't have the resources to monitor the safety of those drugs once they are approved.

What they do in the evaluation of new medicines, both efficacy and safety, is to an extremely high standard. They certainly could benefit from more resources.

WOODRUFF: But why isn't that the responsibility of the pharmaceutical industry? I just heard our report, your company earning $3.4 billion this year on Celebrex alone. Is that correct?

And if that's the case, why isn't more of the responsibility in the pharmaceutical industry?

MCKINNELL: Well, that's the revenue of -- that's the revenue of Celebrex. For almost a decade now the industry has made what we call user fee payments to the FDA to help provide the reviewers and the resources for drug review.

So the industry has been doing that for some time. In fact today it's almost 50 percent of the resources employed by the FDA for review and approval come from the industry. The part provided by us taxpayers, by Congress, during that period has not grown very much at all.

WOODRUFF: And so my question is shouldn't the safety side of that be paid for, at least in part, by the pharmaceutical industry, as well? Why isn't it in the interest of your industry to ensure the safety of these drugs?

MCKINNELL: Well, it is absolutely in the industry -- interest of the industry, not only to monitor and ensure the safety of medicine but to have a very strong agency such as the FDA to monitor and reassure the public that the drugs they are taking are safe and effective when used as recommended.

WOODRUFF: So your answer is that Congress needs to spend -- needs to appropriate more money for FDA?

MCKINNELL: Well, that's part of the problem. We also need access to large databases. When you're talking about parts per hundred thousand, which is what we're talking about in the safety issues being described here today, you can't find those in safety studies of 10,000 or 40,000 or 50,000 patients.

You really need to look at the millions of patients that benefit from these drugs. And we just don't have access to the databases -- the systems don't talk to each other, is the problem -- to effectively monitor the usage of these drugs once they are approved. WOODRUFF: All right. We're going to leave it there for now. Hank McKinnell, he is the chairman and CEO of Pfizer. Mr. McKinnell, thank you very much...

MCKINNELL: Thank you, ma'am.

WOODRUFF: ... for talking with us. We appreciate it.

And now we turn from the Celebrex story to homeland security. President Bush suggests the nation will be safer now that he has signed intelligence reform into law. But there is still a good deal of work ahead to carry out the changes in the bill.

Now our senior White House correspondent, John King.

(BEGIN VIDEOTAPE)

JOHN KING, CNN CORRESPONDENT (voice-over): The president's signature makes law the most dramatic changes to U.S. intelligence operations in nearly six decades and marks the second major government restructuring inspired by the 9/11 attacks.

BUSH: Our vast intelligence enterprise will become more unified, coordinated and effective. It will enable us to better do our duty, which is to protect the American people.

KING: The biggest change is a new director of national intelligence, a powerful new post with the authority, on paper, anyway, to shape the intelligence gathering and budgets of the CIA, the National Security Agency, and a dozen other government spy agencies, many of them now under the control of the Pentagon.

BUSH: The director will lead a unified intelligence community and will serve as the principal advisor to the president on intelligence matters.

KING: That new post was the chief recommendation of the 9/11 Commission, which found the terrorist attacks might have been prevented, had the FBI, CIA and other agencies shared information they had about the hijackers.

The new law also creates a federal counter-terrorism center; calls for tighter border security; and sets a uniform standard for government I.D.s used to board commercial airliners.

The president initially resisted many of the major changes but at the signing ceremony, likened the intelligence overhaul to the creation of the new Department of Homeland Security.

BUSH: Our government is adapting to confront and defeat these threats. We're staying on the offensive against the enemy.

KING: Nine-eleven families and commission members were among those on hand to celebrate but also to make clear the president's work is just beginning. Signing the law won't, alone, end turf battles and inefficiencies in the intelligence community. JAMIE GORELICK, 9/11 COMMISSION MEMBER: The president will have to ride herd on this. He will have to make sure that the right people are in place and that the agencies of his administration really work together.

KING: Senior Bush aides say the president hopes to name his pick for the new intelligence post relatively soon, perhaps as early as next week.

(END VIDEOTAPE)

KING: And one way many in Washington say the president could immediately, strongly show his political support for this new director of national intelligence is to have that person, not the CIA director, give the president his morning daily intelligence briefing.

That is a debate, Judy, now underway within the National Security Council. Some officials are for it. They think it would be a good idea. Others think it would be too distracting, that this new director has enough -- a big enough job as it is.

That debate will be settled soon, we are told, along with the debate over who should get that job.

WOODRUFF: We can assume which side the CIA is on in that.

KING: Yes, you can.

WOODRUFF: In that debate.

John, what are you hearing about who they are looking at to head up this new intelligence agency.

KING: The White House is being very quite about this, as they are on most of these sensitive picks. The president has to fill this job. He has to find a new secretary for the Homeland Security Department.

We are told the search has been underway for a couple of weeks. They've known the legislation was coming, anticipating it was coming, once they got the compromise.

We've heard former military officials. John Lehman of the 9/11 Commission gets mentioned. The president's homeland security advisor, Fran Townsend, gets mentioned. Some word today even the departing deputy secretary of state, Richard Armitage, being considered.

A lot of names we're hearing, but the White House is keeping its hands off this. But they do say the president wants to make this decision relatively soon. Some say, again, it could come before the end of the year.

WOODRUFF: Two really big jobs to fill. OK, John, thank you very much. Appreciate it.

News now over at the Pentagon: is Defense Secretary Donald Rumsfeld feeling secure about his job? Coming up, we'll talk about Rumsfeld under fire. And which senators are criticizing him?

Also ahead, the presidential campaign may be over, but some of the toughest critics of John Kerry's war record are fighting on.

And later, my exclusive sit-down joint interview with Kerry campaign manager Mary Beth Cahill and Bush campaign manager Ken Mehlman. Find out what they say they would have done differently.

(COMMERCIAL BREAK)

WOODRUFF: The latest developments in the Washington state governor's race recount leadoff, our Friday "Political Byte."

King County elections officials today found 150 more misplaced ballots, bringing the total number of newly discovered ballots in the Democratic leaning county to 723.

With results from King and just two other county's still unknown, Republican Dino Rossi leads Democrat Christine Gregoire by only 74 votes.

Republicans are seeking a restraining order this afternoon to prevent these 723 ballots from being counted until more is known about how they were stored and why they were not counted earlier.

A leader of the anti-John Kerry group Swift Boat Veterans for Truth says his organization is not going away. William Frank tells the "St. Louis Post-Dispatch that the group will meet next month to celebrate its successes and to consider other ways to publicize their criticisms of Senator Kerry.

Kerry supporters who want to make a political point with their spending habits have started the web site BuyBlue.org. Using records from the FEC and the Center for Responsive Politics, the web site attempts to highlight the political leanings of PACs, their officers and employees affiliated with various businesses.

Outback Steakhouse and the Home Depot are among those labeled as pro-Republican. Starbucks and the Hard Rock Cafe are among those labeled pro-Democrat.

Mounting criticism for Donald Rumsfeld, even among Republicans. Three reporters join me next to talk about the defense secretary and the growing number of lawmakers going public with their concerns.

(COMMERCIAL BREAK)

WOODRUFF: Two more U.S. senators, one of them a Republican, have joined the criticism of Defense Secretary Donald Rumsfeld.

Indiana Democrat Evan Bayh, a party moderate who supported the war in Iraq, told National Public Radio he has lost confidence in Rumsfeld and that he thinks Rumsfeld should resign.

Republican Norm Coleman of Minnesota, meanwhile, stopped short of calling for Rumsfeld to resign, but he told the Associated Press, quote, "I have concerns about Rumsfeld's leadership."

Republican senators Trent Lott and John McCain have also recently voiced concerns about Rumsfeld's performance.

With me now to talk more about Donald Rumsfeld and some of the other stories making headlines, Liz Marlantes of the "Christian Science Monitor"; Mike Allen of the "Washington Post"; and Jeff Zeleny of the "Chicago Tribune."

Jeff, let me start with you. Is Donald Rumsfeld in some jeopardy now?

JEFF ZELENY, "CHICAGO TRIBUNE": Well, I think any time you have the White House spending more time defending someone and more time sort of fending off words from Republicans it is a sign of trouble. I mean, it's sort of one by one this past week.

So one Republican aide I spoke to said, "We can't wait for the holidays to come soon enough so it sort of goes away, the senators go out of town."

But I think he could be in trouble. It's not that uncommon for John McCain to voice concern. But when you have Trent Lott saying that he is concerned and, you know...

WOODRUFF: And Norm Coleman.

ZELENY: And Norm Coleman from Minnesota saying he's concerned, I think that is a sign that there are problems in the future and the White House is just hoping that they can get through the Iraqi elections in January and then take it from there.

WOODRUFF: Is that really what it is? It's a matter of just holding this off until they get through the end of January?

LIZ MARLANTES, "CHRISTIAN SCIENCE MONITOR": Yes, in fact, I was going to add to that, that in some ways I think you could make the argument that having Trent Lott come out and criticize Rumsfeld is, in the short term, probably going to save his job. I don't think the White House is going to look -- want to look like they're bowing to pressure.

And in that sense, I think they came out very strong defending Rumsfeld again today. And that's not a surprise. It may spell trouble over the long term. But I think we've seen in the past if you look at what happened with George Tenet, when there's a lot of heat, this White House sort of likes to stay with their man.

WOODRUFF: And so how -- at what point -- I mean, what would it take to tip the scales for this White House?

MIKE ALLEN, "WASHINGTON POST": Well, today Scott McClellan spent the first five questions of his briefing defending Senator Rumsfeld (sic). And as Jeff points out, that's not a good way to make points with the boss. But, as Liz pointed out, similarly, somebody was saying that maybe Senator McCain started this because he wanted to be defense secretary. Now, people in the White House point out to us that's about the worst way to get the job, if you want to.

But Republicans are starting to say, you know, that January 30 time would be a convenient time for the president to move him in if he wanted to. Now Secretary Rumsfeld...

WOODRUFF: Move?

ALLEN: For -- to make a change at the Pentagon.

Now, Secretary Rumsfeld wants to stay at least through the year, put his stamp on the quadrennial defense review that they're going to be doing.

But this was not a wrinkle the White House had expected. They had this very business-like rollout plan, respective of the cabinet. They thought that when they said that Secretary Rumsfeld was staying that that would be the end of it.

WOODRUFF: Well, but you have a situation now where you've got some Republicans who now have the courage to speak out. Once you get a few, does this just naturally build? Or is there going to be a holiday because of Christmas and New Year's and the rest of it?

ZELENY: I think it's certainly making it easier for the members on both sides to speak out. But the White House is sort of looking around for other Republicans to come to their aid.

Mitch McConnell was one today. He said he has confidence. Even Chuck Hagel of Nebraska has raised concerns. But he has not used the lack of confidence or step down.

So I think, you know, there is a sense that this may be a temporary thing and it may sort of move on to other things. But, you know, it's -- it's a problem.

MARLANTES: The other point to make is that in a way this is really serving, I think, as a proxy for frustration and concern over the policy in Iraq, in general.

And I think, obviously, what happens with the election is -- what happens over there is going to have a great influence in terms of how Rumsfeld -- what happens to Rumsfeld.

WOODRUFF: Sure. In the time we have left, I want to quickly turn you all to the intelligence reform bill.

Mike, the president signed it today. How much credit can he take for this? I mean, clearly, he signed it. He was pushing it. But there were others who were pushing him.

ALLEN: I agree. Well, certainly, he's taking the credit. This is a classic example of seeing a parade and running out in front and pretending that you're leading it.

As you know, both the president -- this president doesn't like to be told what to do, whether it's putting on makeup or consulting the U.N. And they did not like the fact that this commission was pushing for this, the 9/11 widows. But they got a lot of political momentum behind them.

And the president, who initially resisted it publicly later sort of did little to help publicly. Eventually, he wanted it pushed forward.

And today, you'll get the full ceremony, 300 people, the "protecting America" signs just like from the campaign, the ceremonial pens. And you know, this has been the pattern of this White House with homeland security, campaign finance. If it becomes popular, take credit.

WOODRUFF: Because this -- they were originally against the whole idea.

ZELENY: They certainly were. And you know, there were problems over the past few weeks on the Hill getting this through.

But one thing that really sort of happened and helped this out are the widows, as Mike mentioned. They came up here, four of them in particular, with a strong, strong lobbying force. And it was very difficult to say no to.

And also Jane Harman of California and Susan Collins of Maine sort of worked on this together. So in intelligence it hasn't always been a woman's field. But they were very aggressive and worked like this, as one aide told me, in a sisterhood bond that involved late night drinks together and "how will this work out? And how will we pressure the others into getting this going?"

So I think all of them probably deserve more than the president.

WOODRUFF: The women.

MARLANTES: And there's a political dynamic to that, as well, as we learned in this election. Security moms exist. That was an actual factor. Bush shrunk the gender gap in the election, largely because of -- of security issues, national security.

WOODRUFF: Another interesting connection here.

All right. Thank you all three, Jeff, Liz and Mike. It's good to see you both. Have a great weekend.

MARLANTES: You, too.

ZELENY: Thank you.

ALLEN: Thank you.

WOODRUFF: Appreciate it. Thank you. Well, the Bush White House is still searching for a new homeland security director a week after Bernie Kerik withdrew his nomination. Still ahead, new details on why one senator took a pass on the job.

Plus, a soon to be former congressman returns to Capitol Hill, proving he is not on a power trip. More INSIDE POLITICS coming up.

(COMMERCIAL BREAK)

WOODRUFF: A little bit before 4 p.m. in 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, HOST, "LOU DOBBS TONIGHT": Hi, Judy. Thank you.

A bombshell for Pfizer today, shares of the drug maker tumbling after a government-sponsored study shows increased health risks for users of its top-selling arthritis drug, Celebrex.

Celebrex is expected to bring in $3.5 billion in sales. It's similar to Merck's Vioxx which was withdrawn from the market back in October, because it was linked to a higher risk of heart attacks. Pfizer says it's not withdrawing Celebrex at this time. Pfizer shares, nonetheless, tumbling more than $3, down 11 percent on the day. Huge trading volume. Merck shares also down. AstraZeneca and Eli Lilly sharply lower as well on two other drug setbacks. AstraZeneca's lung cancer treatment Iressa did not help patients live longer in a major clinical trial. And Eli Lilly added a warning to the product label of its key ADD medication Strattera. It says patients with liver problems should stop taking that drug.

Pfizer is one of the 30 stocks in the Dow Jones Industrials and as a result, the Dow is down 37 points. Final trades now being counted, down 47.66. The Nasdaq's losing one-third of a percent. Also pressuring the market, sharply higher oil prices today. Crude oil jumping more than $2 a barrel. Concerns about colder than normal weather in the northeast.

And coming up here on CNN at 6:00 p.m. Eastern on "LOU DOBBS TONIGHT," an in-depth look into the major problems plaguing this country's pharmaceutical industry. The Celebrex scandal is another huge blow to the drug companies, only the latest. It's already dealing with the threat from Generics, foreign competition and a poor public image to go along with its pharmaceutical problems and health risks that are being created. We'll have a special report for you tonight.

Also, from Vioxx to Celebrex, the Federal Drug Administration has approved dangerous drugs that put your health at risk. We'll be taking a look at the FDA's failure to protect the American consumer.

Also, Defense Secretary Donald Rumsfeld under fire in Washington. Several members of Congress now questioning the president's unwavering confidence in Rumsfeld. Just this week Senator Susan Collins fired off a letter to Secretary Rumsfeld regarding the lack of armored vehicles for troops in Iraq. Senator Collins is my guest tonight.

In our special report, "Broken Borders" immigration is federal law. But increasingly, local law enforcement is getting involved, because they have to. We look at the controversy surrounding the efforts by local police to arrest illegal aliens. We hope you'll join us at 6:00 p.m. Eastern here on CNN. Now back to Judy Woodruff.

WOODRUFF: Lou, this news about Celebrex has to be disturbing to many Americans. What is your sense of what's going on inside the pharmaceutical industry? I know you're going to be looking at the story tonight.

DOBBS: Absolutely. And we'll be in depth in our look into this industry plagued by, first, just bringing drugs to market that are not being adequately tested over the long term, in some cases, the short- term as well. We'll be taking a look at the number of drugs about which there are great questions about their safety. That will be part of our reporting as well tonight. Dr. David Graham, the whistleblower at the FDA, deserving great credit for blowing the whistle on this problem that seems to be blanketing the entire industry. The fact is the FDA is not doing the job that it is supposed to be doing, and unfortunately, Congress has not, at least to this point, done the job it should in terms of its oversight function with the FDA and this industry as Senator Chuck Grassley is changing all of that and we'll be focusing on his efforts as well.

WOODRUFF: Lou, thanks very much. I just talked with the chairman of Pfizer who said one thing that needs to happen is Congress needs to send more money to the FDA for these drug trials. We'll see. We'll be watching you at 6:00.

DOBBS: And we'll have some advice for the CEO as well. Thank you, Judy.

WOODRUFF: Thanks, Lou.

And INSIDE POLITICS continues right now.

(BEGIN VIDEOTAPE)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Under this new law, our vast intelligence enterprise will become more unified, coordinated and effective.

ANNOUNCER: The president presides over 9/11 reform after years of political pushing and prodding.

Election hindsight. Managers of the Bush and Kerry campaign join Judy for an exclusive look back.

WOODRUFF: What were the toughest moments for your campaign?

ANNOUNCER: A series of unfortunate events. The title of a new movie could aptly describe the chain reaction that led to the political play of the week.

UNIDENTIFIED FEMALE: Maybe he just doesn't make a very good first impression.

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

(END VIDEOTAPE)

WOODRUFF: Welcome back. When President Bush signed 9/11 reforms into law today he was surrounded by more than a few people who had been pushing for elements of the bill a lot longer than he had. Our White House correspondent Dana Bash reports on the signing ceremony, and how Mr. Bush got there.

(BEGIN VIDEOTAPE)

DANA BASH, CNN WHITE HOUSE CORRESPONDENT (voice-over): The president gets credit from all involved for personally pushing the intelligence reform measure over the finish line. However, many recall he was initially a skeptic, if not a critic, of the effort.

TIM ROEMER (D), 9/11 COMMISSION MEMBER: The president was "Johnny Come Lightly" to this. Better late than never.

BASH: At first he fought creating the independent 9/11 commission, saying a congressional probe was adequate.

BUSH: My judgment is best for the ongoing war against terror that the investigation be done in the intelligence committee.

BASH: September 11 victims' families lobbied, and six months later, the president signed on. Then a series of skirmishes, from some quiet struggles over boosting its initial $3 million budget to larger public battles turned political pressure points. The commission wanted broad access to classified documents especially the president's own daily intelligence briefings, what he knew about al Qaeda's threat.

BUSH: It's important for the writers of the presidential daily brief to feel comfortable that the documents will never be politicized and/or unnecessarily exposed for public purview.

BASH: The president resisted but later compromised. Another flashpoint, whether national security adviser Condoleezza Rice would testify at commission hearings. The White House initially refused citing executive privilege. Again it later gave in, as it also did in agreeing the president and vice president would answer commissioners' questions, though that was still private.

JAMES THOMPSON (R), 9/11 COMMISSION MEMBER: Though there was controversy along the way and obviously disagreements from time to time...

BASH: But 9/11 commission's recommendations were yet another example. In the heat of the president's campaign, Democrat John Kerry embraced them immediately. Mr. Bush initially was more circumspect.

BUSH: The 9/11 commission also... BASH: But then backed the reform and after public pleas from some fellow Republicans still unsure how serious his support was, Mr. Bush eventually used his re-election capital to push the bill through Congress.

DAVID GERGEN, FMR. WHITE HOUSE ADVISER: The president faced the political necessity of not losing on this, not being overrun and not seeming to care about this intelligence. I think that's one of the reasons they came around.

(END VIDEOTAPE)

BASH: And the president's critics note he also initially resisted then embraced creating a homeland security department, but even they say that these intelligence reforms were enacted relatively quickly and they say the bottom line, it's the Bush signature on this law and that is what history will remember.

WOODRUFF: That's right, Dana. Also the president's upcoming decision to name the first head of this new intelligence organization.

BASH: That's right. And he's going to be working on that relatively quickly. You might get an answer on that as early as next week, we're told.

WOODRUFF: Dana Bash, thank you very much at the White House.

From homeland security to the safety of American troops overseas. In London, our Bill Schneider has been listening to gripping on both sides of the Atlantic. Hello, Bill.

WILLIAM SCHNEIDER, CNN SR. POLITICAL ANALYST: Hello, Judy. You know, a question asked in Kuwait last week set off a political firestorm in Washington this week. It's a political play of the week on delayed response.

(BEGIN VIDEOTAPE)

SCHNEIDER (voice-over): It all started with this question asked by a soldier at a town hall forum with the secretary of defense in Kuwait.

SPEC. THOMAS WILSON, TENNESSEE ARMY NATL. GUARD: Now, why do we soldiers have to dig through local landfills for pieces of scrap metal and compromised ballistic glass to up armor our vehicles and why don't we have those resources readily available to us?

SCHNEIDER: Mr. Secretary?

DONALD RUMSFELD, SECRETARY OF DEFENSE: You go to war with the army you have.

SCHNEIDER: That provoked criticism.

SEN. CHUCK HAGEL (R), NEBRASKA: That soldier and those men and women deserved a far better answer from their secretary of defense than a flip it comment.

SCHNEIDER: The controversy escalated quickly into a full-fledged attack on Rumsfeld.

REP. NANCY PELOSI (D), MINORITY LEADER: No CEO in America would retain a manager with so clear has a record of failure, and neither should President Bush.

SCHNEIDER: And not just from Democrats. Senator Trent Lott said Rumsfeld should be replaced sometime in the next year. Conservative editor William Kristof wrote in the "Washington Post," "these soldiers deserve a better defense secretary than the one we have."

Why did one question from a soldier blow up into a political firestorm? Because things are not going well for the U.S. in Iraq. Many conservatives are targeting, some would say, scapegoating Rumsfeld for refusing to send enough troops to get the job done and for being unprepared.

HAGEL: We were unprepared for what we were going to face, what we are facing in a post-Saddam Iraq, and this is just one more manifestation of the problem.

SCHNEIDER: This whole thing started because a reporter from the "Chattanooga Times Free Press" suggested that the soldiers ask Rumsfeld about their grievances, since the press was not allowed to ask questions at the forum.

TOM GRISCOM, CHATTANOOGA TIMES FREE PRESS: He had a conversation with some of the soldiers who'd been talking to him about this and they decided then to go forward and ask the question.

SCHNEIDER: From a small suggestion to the political play of the week.

(END VIDEOTAPE)

SCHNEIDER: The long kniving are out for Donald Rumsfeld. There is one way he can save his job and his reputation. And that is, if things start looking better in Iraq after the election there next month. That, Judy, will be the big test.

WOODRUFF: The two things do seem to be in inextricably linked. Bill Schneider, thanks very much. We appreciate it. Bill in London all this week.

Well, you don't get a do-over in presidential race most of the time, but what if the Bush and Kerry campaign managers could go back and do something differently? Find out what they would do in my exclusive joint interview with Ken Mehlman and Mary Beth Cahill.

Also ahead, will the Senate majority leader have a surprise up his sleeve when Congress returns in January? Bob Novak has the inside buzz.

And later, a retiring congressman and his surprising new job on the Hill.

(COMMERCIAL BREAK)

WOODRUFF: These are officials in Missouri talking about the gruesome case of a woman found murdered and the fetus inside the pregnant woman missing. Let's listen.

(BEGIN LIVE EVENT)

UNIDENTIFIED NODAWAY CO. SHERIFF: We're not going to confirm this 100 percent. It's about as good as we can get, people.

UNIDENTIFIED MALE: What's the timeline on the confirmation? How long will it take to test?

UNIDENTIFIED NODAWAY CO. SHERIFF: I can't tell you. Just whatever the medical testing takes. The DNA testing.

UNIDENTIFIED FEMALE: Do you have any idea if the abductors knew (UNINTELLIGIBLE)?

UNIDENTIFIED NODAWAY CO. SHERIFF: No, we don't know that yet. I mean, we're still trying to put that together.

UNIDENTIFIED MALE: Sir, can you give us anything on how they were tracked down? How you guys found...

UNIDENTIFIED NODAWAY CO. SHERIFF: We had an anonymous tip, and that's the tip I told you this morning when I gave a news release at about 10:00. That tip is one of those that we thought we really needed to track down and we went after that one and we really focused on that hard, let some of the others go up in smoke, and I -- we was on the right track and it's really paid off.

UNIDENTIFIED MALE: Did the amber alert help?

UNIDENTIFIED NODAWAY CO. SHERIFF: Yes, it did. It really did.

UNIDENTIFIED MALE: That led to a tip?

UNIDENTIFIED NODAWAY CO. SHERIFF: That led to a tip, which led us on the right track.

UNIDENTIFIED NODAWAY CO. SHERIFF: And you're not saying which part of Kansas -- whether or not in its Drew County or where it is at this point?

UNIDENTIFIED NODAWAY CO. SHERIFF: We're going to use the state of Kansas for right now.

UNIDENTIFIED MALE: (UNINTELLIGIBLE) health of the child?

UNIDENTIFIED NODAWAY CO. SHERIFF: The child appears to be healthy and in good shape. And the child is at a hospital right now being checked out by a pediatrician. And we have no indications that the child is hurt in any way, and the child is probably going to be OK. That's the information we're getting.

UNIDENTIFIED MALE: In what kind of condition was the child found -- what was the child wearing...

UNIDENTIFIED NODAWAY CO. SHERIFF: Can't go into that right now. Because we don't know. Investigators are still working, we're just getting what information we can pass on to you. Sure.

UNIDENTIFIED MALE: Any perpetrators?

UNIDENTIFIED NODAWAY CO. SHERIFF: They're talking to two different people at this moment.

UNIDENTIFIED MALE: Have you found a red Honda?

UNIDENTIFIED NODAWAY CO. SHERIFF: The car that we put out on the amber alert is the car that was located in the driveway of this residence in Kansas. So we was right on track. Our people -- our neighborhood people that give us the description of this car was right on track on that and that really helped out on the amber alert.

UNIDENTIFIED MALE: Motive? Any intention to sell, do you think, on the part of the people you're questioning?

UNIDENTIFIED NODAWAY CO. SHERIFF: We have -- we don't know their motives.

UNIDENTIFIED MALE: Do you have anything to say?

SHERIFF BEN EPSEY, NODAWAY CO., MISSOURI: Nothing yet at this point.

UNIDENTIFIED MALE: How many people were arrested?

UNIDENTIFIED NODAWAY CO. SHERIFF: There's two people being questioned at this time. And I think that's where we'll leave it. We'll see where it goes from there.

UNIDENTIFIED MALE: These responses sound like you're sure this is the baby?

EPSEY: I could tell you we're hopeful that this is the child, yes.

UNIDENTIFIED MALE: Is the amber alert being canceled now?

EPSEY: Not that I know of.

UNIDENTIFIED NODAWAY CO. SHERIFF: We won't cancel that amber alert until we confirm that...

UNIDENTIFIED MALE: Are these two people two men? A man and a woman? Or two women?

UNIDENTIFIED NODAWAY CO. SHERIFF: Just two individuals.

UNIDENTIFIED MALE: Has Mr. Stenett (ph) been notified?

UNIDENTIFIED NODAWAY CO. SHERIFF: We're in the process of doing that right now.

UNIDENTIFIED MALE: What was the initial condition of the baby that you heard personally?

UNIDENTIFIED NODAWAY CO. SHERIFF: What come across to me is that the baby is fine. They're going to take it and have it checked out. The baby appears to be fine.

UNIDENTIFIED MALE: Going to be healthy?

UNIDENTIFIED NODAWAY CO. SHERIFF: Appears to be that way.

UNIDENTIFIED MALE: (UNINTELLIGIBLE)?

UNIDENTIFIED NODAWAY CO. SHERIFF: This is a two-day old baby that we're talking about now. Because it happened yesterday.

UNIDENTIFIED FEMALE 2: Sheriff, do you have (UNINTELLIGIBLE) the baby is? You know, eight months...

UNIDENTIFIED NODAWAY CO. SHERIFF: That's the closest information we got. It's eight months. Approximately one month premature.

UNIDENTIFIED MALE: Did the husband know that the child was going to be a girl?

UNIDENTIFIED NODAWAY CO. SHERIFF: The family knew this.

UNIDENTFIED MALE 15: And did the child have a name?

UNIDENTIFIED NODAWAY CO. SHERIFF: I don't -- I couldn't answer that.

UNIDENTIFIED MALE: Do you anticipate the arrest of more people coming in on this circle?

UNIDENTIFIED NODAWAY CO. SHERIFF: That's just -- that will depend on the investigation and that's people that's beyond us right now and they're unable to give us a lot of information. We're giving you what we have, which I think is really, really good information that you can take with you.

UNIDENTIFIED MALE: What about anything on (UNINTELLIGIBLE), do we have autopsy results or any results from that?

UNIDENTIFIED NODAWAY CO. SHERIFF: They're still in the process of doing an investigation on that.

UNIDENTIFIED MALE: Any funeral arrangements?

UNIDENTIFIED NODAWAY CO. SHERIFF: We don't know on that.

UNIDENTIFIED MALE: Will any of this investigation lead out of the country, or is it all going to be in states surrounding this?

UNIDENTIFIED NODAWAY CO. SHERIFF: We don't know. We don't know.

EPSEY: Wherever the investigation takes us. At this point, there's no way to predict that.

UNIDENTIFIED NODAWAY CO. SHERIFF: We don't anticipate that, but it won't be ruled out.

UNIDENTIFIED MALE: Thank you.

UNIDENTIFIED NODAWAY CO. SHERIFF: Thank you all.

(END LIVE EVENT)

WOODRUFF: What started out as a truly horrible story about a woman eight months pregnant in Skidmore, Missouri, we're told it's about 35 miles north of St. Joseph, Missouri. She was found murdered yesterday by her mother, and the woman -- the woman had been literally cut open and the fetus inside her removed and police, as you just heard, and the sheriff's deputy there in the Skidmore, Missouri, community, saying that the baby has been found two days old, apparently in good health. They have received a tip based on a car that was seen parked in the woman's driveway. They found that car, a red car in Kansas, and they found the baby. And as you just heard him say, it does appear to be in good health. Just a truly horrific story, but with somewhat of a good ending for this baby.

INSIDE POLITICS will be right back.

(COMMERCIAL BREAK)

WOODRUFF: CNN's congressional producer Ted Barrett has learned from congressional sources that the date of the president's State of the Union address will be Wednesday, February the 2nd. It is expected that the White House will make a formal announcement this coming Monday.

Time now for some inside analysis of the 2004 White House race with two people who helped shape the campaign strategies. I spoke just a couple days ago with Bush campaign manager Ken Mehlman and his counterpart from the Kerry campaign Mary Beth Cahill. They were at Harvard for a seminar on the 2004 election. In the second part of my exclusive interview I asked both of them if there were times in their respective campaigns when they thought they had reached an important turning point.

(BEGIN VIDEOTAPE)

MARY BETH CAHILL, KERRY CAMPAIGN MANAGER: I think the morning of the Iowa caucuses. Michael Hooley (ph) who ran our turnout operation in Iowa handed me a piece of paper and said, OK, this is how many households we have. Of course, there had been so much in the press and around about you know, what was actually going on, and I looked at the number. It tracked very closely with our polling. I felt like, this is fabulous. And then I thought, if we win this, we're going to be at this for, you know, another ten months. So I was thrilled and, you know, sort of horrified at the same time.

WOODRUFF: What about for you, Ken? Was there a moment that was just...

KEN MEHLMAN, BUSH CAMPAIGN MANAGER: I want to say was a participant in the 2004 Iowa caucus, I feel both your pain and also your joy at that result. I think that the last night of the convention when the president gave a speech where he laid out that vision for the future. And when Senator Kerry ended up at around midnight where he attacked the president, attacked the vice president for what they did during the time of the Vietnam War. I thought that was a very important moment. It showed a real difference in one campaign that was focused on the future and another that seemed to be somewhat trapped in the past. I thought that was a very important moment.

I thought that the Grand Canyon moment when for so long Kerry had been attacking President Bush on Iraq and President Bush finally framed the question and said, knowing everything you know now, what would you do, he said same thing. In terms of the vote, I felt that was also an important moment in the campaign. Obviously, there were a lot of important moments. I don't know that it comes down to one moment.

WOODRUFF: Do you have a perspective on that?

CAHILL: I think that there are lots of high and low points in the campaign. I really agree you can't point to one given moment. For me, the fact that when we came out of our primaries, I think it would be March 18, we had $2.3 million and the Bush/Cheney campaign had $114 million. They did exactly what you would expect them to do which was unload on John Kerry and we had to play catch-up in order to really get into the general election. That was an enormous moment. The other one for me, as I said, is August, when we were spending very precious general election funds, and they were still able to spend from the primary. So for me, those are the two really big things.

WOODRUFF: Tough, tough times.

CAHILL: Very tough times.

MEHLMAN: One of the other things you all did incredibly well was raise resources. This is a campaign where the DNC outraised the Republican National Committee. Their 527s outraised ours by more than $100 million. And when you look how well funded the Kerry campaign was and the efforts your team made, it was incredibly impressive.

WOODRUFF: What were the toughest moments for your campaign?

MEHLMAN: I think that we approached the election from the beginning realizing and thinking this would be an election that was very close. We always said we thought it would be a three-point race at the most. So obviously, there were times when news was difficult, like the spring of this past June, when the Abu Ghraib prison scandal was going on, the numbers were tougher and obviously, that was a tough period. WOODRUFF: Is there one thing that you would have done different? You have already kind of talked about this, and you at one point thought you were running against Howard Dean and not John Kerry. That was before, what happened in Iowa. But is there one thing you wish you had done differently that would have made a difference, do you think?

CAHILL: I think we took advantage of every opportunity that offered itself to us, and we made opportunities. And I think actually John Kerry's performance in the debates was very much a high moment for us. And the fact that we put so many eggs in that basket, that he performed at such a level was, for me, a very high moment in the campaign.

MEHLMAN: I felt good about the campaign we ran. I was one of -- one of the things I wish we had done more aggressively was answer the false charge about a draft. That's something that I think ended up hurting us a little bit with the young folks, and I think when you look at the president's agenda, it's so powerful for young Americans. We should have answered that more powerfully. But I felt great about the campaign we ran and they ran a great campaign. These were two good campaigns. It was a good campaign for the country and now we're going to come together and work on policy.

(END VIDEOTAPE)

WOODRUFF: Ken Mehlman and Mary Beth Cahill in their first joint interview since the election. They were more than polite toward one other, but it was clear there are still real disagreements over tactics used by the other campaign.

Bob Novak joins us now with his inside buzz. First of all, Bob, what is this about Senator Bill Frist maybe trying to change the rules when the Senate comes back in January?

BOB NOVAK, CO-HOST, "CROSSFIRE": It's been clear that he wants to change the vote on the confirmation of appellate judges to a majority vote so that they can't filibuster it by a parliament...

WOODRUFF: It's called two-thirds?

NOVAK: Yes. It's called a nuclear option. Now the question that has been buzzing around over on the Hill all week is, will he do that on the opening day of the Senate? January 4, because the Democratic leader Harry Reid says he will screw things up, and the normal ceremonial first day will turn into a bloodbath. Senator Frist is not saying anything, but my understanding is, he's not going to do it the first day but it's going to happen sometime in the session. Maybe wait until a judge confirmation comes up on the floor.

WOODRUFF: And on that day, we may see the steam coming out of that dome sitting behind me. All right. Behind the scenes, feelers put out from the administration to Joe Lieberman about heading up homeland security. What have you learned?

NOVAK: The story I heard is, he first was felt out about the U.N. ambassadorship. Ambassadorship to the United Nations. And I'm told that the president talked to him himself, he asked if he'd be interested. Lieberman said, well, I'll think about it. According to my sources he went to two Republican senators, Senator McCain of Arizona, and a senator from Maine -- I'm having a...

WOODRUFF: Susan Collins.

NOVAK: Susan Collins. And Susan Collins told Joe, that's a good idea. McCain says don't take it. You won't have any authority. That's what my sources say. Anyway, he turned it down.

WOODRUFF: So McCain said don't do it. The Bernard Kerik nomination, a lot of publicity about Mr. Kerik, but what about Rudy Giuliani who strongly recommended him?

NOVAK: The question is, would this hurt Rudy Giuliani's chances to be president of the United States which is a job he wants. I checked around with Republicans, and the answer is, yes, it sure does hurt. There's a lot of problems for Rudy Giuliani in the Republican party anyway, because he's liberal on a lot of social issues, abortion, gun control, gay rights and so on. But he's so charismatic and so popular with the rank and file, this was really a serious blow that he recommended this man, was just a terrible appointment, it turns out, kind of vouched for him and Republicans say, boy this is a black mark on Rudy Giuliani, that he may not be able to get over.

WOODRUFF: Finally, Bob, tensions between the United States and the Bush administration and the United Nations. What are you hearing?

NOVAK: Carol Bellamy, who you may remember, she was the president of the New York City council, ran for mayor once. She, a very, very liberal Democrat, was named head of UNICEF by president Clinton, had a very liberal record there, and the story I get is that when she finishes, because President Bush is not going to reappoint her certainly, that Kofi Annan may appoint a non-American as the head of UNICEF. That has always been an American slot, but they're worried about Bush putting in a, conservative maybe Ann Veneman, the outgoing secretary of agriculture and it would change policies and it really would add to the tension that the bureaucracy of the U.N. dumped an American out of UNICEF which has always been an American enclave at the U.N.

WOODRUFF: We're glad to have you, Bob Novak. Inside buzz. And that's it for INSIDE POLITICS this Friday. Have a good weekend. Now we're going to go to that show that Mr. Novak often appears on. "CROSSFIRE" is next.

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