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JUDY WOODRUFF'S INSIDE POLITICS

Heads Roll at CBS News Over Bush National Guard Story; Powell Reports Back on Tsunami Devastation and Relief; Newt Gingrich Picking Fight with President Bush?

Aired January 10, 2005 - 15:30   ET

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


(BEGIN VIDEOTAPE)
ANNOUNCER: Heads roll at CBS News over its controversial Bush National Guard story. Will that repair the image of the network and outgoing anchor Dan Rather?

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Mr. Secretary, welcome back.

ANNOUNCER: Colin Powell reports back to President Bush on tsunami devastation and relief.

BUSH: The government of the United States is committed to helping the people who suffer. We're committed today, and we will be committed tomorrow.

Is Newt Gingrich picking a fight with President Bush?

NEWT GINGRICH, FORMER SPEAKER OF THE HOUSE: You can look at what needs to be fixed and what needs to be done better without getting into a sort of personality food fight.

ANNOUNCER: We'll find out what the former House speaker's up to and whether he has White House ambitions in 2008.

Now live from Washington, Judy Woodruff's INSIDE POLITICS.

(END VIDEOTAPE)

JUDY WOODRUFF, CNN ANCHOR, INSIDE POLITICS: Thank you for joining us. We begin with new fallout from a flawed election year news report about President Bush's National Guard service. CBS News says that it has ousted four employees for their role in the "60 Minutes" report. An independent panel found CBS failed to determine the accuracy of documents. Spurred by what it called myopic zeal to get the story on the air. Then the panel says CBS blindly defended the report despite growing evidence that the documents may have been fake.

CBS Chief Executive Officer Les Moonves says much of the September 8th broadcast was, quote, wrong, incomplete, or unfair. Moonves says no action is necessary against Dan Rather for his role in reporting the story. Since Rather apologized and plans to step down as anchor of the "CBS Evening News." But Senior Vice President Betsy West, Executive Producer Josh Howard and Senior Broadcast Producer Mary Murphy were asked to resign. And the producer of the National Guard report, Mary Mapes, was fired. The White House welcomed the action.

(BEGIN VIDEO CLIP)

SCOTT MCCLELLAN, WHITE HOUSE PRESS SECRETARY: CBS has taken steps to hold people accountable, and we appreciate those steps. We also hope that CBS will take steps to prevent something like this from happening again.

(END VIDEO CLIP)

WOODRUFF: Does this put the controversy to rest? Let's bring in Howard Kurtz of CNN's RELIABLE SOURCES and he is of course the media reporter for "The Washington Post."

Howard, does this put all this to rest?

HOWARD KURTZ, "THE WASHINGTON POST": CBS would certainly like to believe that, but it's going to take a while for the network to get over a high profile blunder taking on the president and having to back off the report -- a blunder of this magnitude. You're already having people say gee, how come if Dan Rather was at fault here he's allowed to continue as a correspondent for "60 Minutes." Rather of course has apologized on the air for his role in this. And you have people raising questions about the CBS News President Andrew Hayward who asked his deputies to make sure before this thing aired that all of this was double and triple checked, but apparently it was not.

WOODRUFF: Howard, what is at the heart of what was done wrong here?

KURTZ: It's a pretty long list, let me try to compress it for you Judy. Just about everything was done wrong. The reporting was flawed, the source was suspect. CBS didn't talk to the original source, that is the person who gave these alleged 30-year-old memos written by President Bush's former squadron commander in the Texas National Guard to the person that they got it from.

And then the vetting process was badly flawed and top executives didn't ask the probing questions they should have. The handwriting experts that they consulted had warned them about the story. They went ahead with it anyway. And finally as you alluded to at the top, for ten long days -- and I remember being on the phone with them every day -- Rather and CBS continued to defend this story even after every blogger and other news organization were raising questions about what appeared to be very suspect documents.

WOODRUFF: Howard, you, obviously, have covered the media for some time. This is sill a subjective question. Has CBS News been hurt by all this?

KURTZ: There is absolutely no question. In fact just moments ago, Judy, I talked to CBS President Les Moonves who said this is a black eye for CBS. No getting around it. Although he hopes to repair the damage with some of the steps that he has taken, including installing a new senior vice president for broadcast standards. And I think it is a blow to everybody in journalism. I said this after the Jayson Blair story in "The New York Times." I said this after the Jack Kelly story at "USA Today." This is probably the most high profile of the media meltdowns because it involves a globally famous anchor. But when something like this happens all the people out there -- and there are a lot of them -- who already distrust the media, who suspect that we have agendas or that don't check the facts carefully, they come to conclude that they're right and that our -- we are shoddy in doing our job. And CBS is make nothing attempt to dispute any of the findings in this report by former Attorney General Dick Thornburgh and former AP Executive Lou Boccardi.

WOODRUFF: Very quickly, Howard. Are steps being taken at CBS and other news organizations, including CNN, to make sure this sort of thing doesn't happen again?

KURTZ: A lot of news organizations took steps after the Jayson Blair fiasco at "The New York Times". I don't know that this has already led to anything at any other network but CBS says that it is changing the procedures, not just appointing a new ombudsman (ph) so to speak. But for example, but not going to let the reporter, in this case, Mary Mapes, be involved in the follow up reporting after the story comes under fire. Some fresh eyes should come. Otherwise you get this defensive posture in which you justify a story that in this case at least turned out to be badly flawed.

WOODRUFF: All right, Howard Kurtz, "The Washington Post" and RELIABLE SOURCES. Howard, thank you.

KURTZ: Thank you.

WOODRUFF: Howard just mentioned CBS President and CEO Les Moonves. He will talk about the fallout at the network and new safeguards that are being put in place on PAULA ZAHN NOW at 8:00 P.M. Eastern tonight on CNN.

Now we turn to the tsunami disaster and how it may be helping President Bush politically. Our new poll shows Mr. Bush's approval rating is holding slightly above the 50 percent mark. Even though a majority of Americans disapprove of how he is handling Iraq, Social Security, health care, and the federal budget deficit. But a sizable 75 percent of those surveyed say they approve of the way Mr. Bush responded to the tsunami, which may be helping to pump up his overall approval rating.

After initial stumbles, the president went to great lengths to show his support for disaster relief in Asia. And he went that route again today during a meeting with the secretary of state and during a visit to a top relief agency. Here now our White House correspondent Suzanne Malveaux.

(BEGIN VIDEO TAPE)

SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT (voice over): Secretary Powell just back from the hardest hit areas showed Mr. Bush photos of the fields of debris and bodies during a morning briefing at the White House. Powell later accompanied the president to a visit of the headquarters of USAID -- the U.S. agency coordinating the international relief effort -- where Mr. Bush thanked those involved and pledged long-term U.S. support for the victims of the tsunami.

GEORGE W. BUSH, PRESIDENT, UNITED STATES OF AMERICA: We have made a commitment, and our commitment is a long-term commitment.

MALVEAUX: Initially the Bush administration had been criticized for what some considered a slow and psaltery response to the disaster. The White House believes its robust military relief effort and Secretary Powell's high profile visit to the region have largely erased that perception.

BUSH: There's a huge problem, but the good news is, is that the efforts, the compassion, the money, the hope is well coordinated. And that your work is making a difference in saving lives and helping people who need help.

MALVEAUX: The president said that the U.S. government has spent $78 million of the $350 million pledged for tsunami relief but held off for now in committing more.

BUSH: We've been focused on the relief effort. Now we're beginning to focus on rehabilitation and rebuilding.

MALVEAUX: That effort includes offering loans for temporary housing in the most affected areas of Indonesia, Sri Lanka, and India. On Tuesday, the administrator for USAID will attend a donor's conference in Geneva to begin the effort.

BUSH: I particularly want to thank two former presidents, 41 and 42, dad and Bill.

MALVEAUX: Former Presidents Bush and Clinton are airing public service announcements to encourage private donation. Today Clinton announced a fund he's coordinating between his foundation and UNICEF to provide clean water and sanitation.

(END VIDEOTAPE)

MALVEAUX: And this afternoon, the president will be briefed by secretaries of commerce and the interior on the tsunami warning system within the United States. Also, of course, the efforts that's being made with the international community on creating a global one. Judy.

WOODRUFF: All right. Suzanne Malveaux at White House, thank you, Suzanne.

While many Americans are applauding the U.S. response to the tsunami, they are less impressed with the way Muslim nations are helping disaster victims, many of whom are Muslim. Fifty percent of those questioned in our new poll say Muslim countries are doing less than their fair share to help tsunami victims.

In today's "Security Watch," the Bush administration awarded $12 million to the University of Maryland for research aimed at preventing terrorism. Homeland Security Secretary Tom Ridge announced the award at the school's student union. This is the fourth academic effort to bolster knowledge about terrorists, their behavior and ways to improve homeland security.

Tonight on ANDERSON COOPER 360, an in-depth look at rail safety from chemical spills to terrorism, that's at 7:00 P.M. Eastern.

Stay tuned to CNN day and night for the most reliable news about your security.

WOODRUFF: Here in Washington, could a former political player be positioning himself for a comeback? Next, we'll catch up with former House Speaker Newt Gingrich and whether he's thinking about a run for president in 2008.

Also ahead, the Supreme Court gets back to business without the ailing chief justice on the bench. Is William Rehnquist any closer to retiring?

And later, the latest Democrat to announce his candidacy for party chairman. I'll talk with former Congressman and former 9/11 Commissioner Tim Roemer.

(COMMERCIAL BREAK)

WOODRUFF: How time flies. It was ten years ago this month that former Congressman Newt Gingrich was elected speaker of the house. Today after more than six years out of office, he has written a new book and he's hinting at higher ambitions. Here's CNN's Bruce Morton.

(BEGIN VIDEOTAPE)

BRUCE MORTON, CNN CORRESPONDENT: He's back. He, of course, is former House Speaker Newt Gingrich, now 61 and the author of a book "Winning the Future." Still a Republican of course, a supporters of the president, but critical of Mr. Bush in two main areas. On Iraq, quote, I have seen no evidence that we know how to defeat the insurgents. And the decision to disband the Iraqi military was a disaster that our military warned against. And on Social Security, he favors a trust fund to pay for the costs of privatizing the system.

NEWT GINGRICH, FORMER HOUSE SPEAKER: You can fix it over 30 years, I think in a very comfortable way. You build an off-budget trust fund. It pays itself off as the system works.

MORTON: Gingrich has always loved the spotlight as a flamboyant member of the House, as the man who became speaker after his contract with America helped the Republicans take the House ending 40 years of Democratic rule. As the speaker who held a summit meeting with President Clinton in well yes New Hampshire, who famously visited the state in search of not votes of course but moose sightings he said. The speaker who shut down the government rather than yield to Clinton, a transformational figure he famously described himself. So in this political city people wonder, might he run for president in 2008? GINGRICH: I wrote "Winning the Future" in order to focus on a whole big set of ideas. We just finished a long exhausting presidential campaign. I think the country could use a year of let's talk about how do you fix Social Security, how do you fix the federal judiciary, how do you pass litigation reform? Things I think the American people would like to talk about.

MORTON: But he doesn't say no and he'll be promoting the book in Iowa and in New Hampshire. And he told the Associated Press, anything seems possible. Still he's a long shot, as a speaker whose unfavorable rating climbed to over 50 percent, whom "The Washington Post" once called the most disliked member of Congress, who resigned after being reprimanded and fined. Twice divorced, once from a wife that had been diagnosed with cancer. He has baggage for sure, but with Gingrich you just never know.

Bruce Morton, CNN, Washington.

(END VIDEOTAPE)

WOODRUFF: Well picking up on one of the issues Newt Gingrich is talking about, Social Security reform, and stepping back with a more of a big picture look at the impact of the White House budget priorities, I'm joined here in Washington by political analyst Ron Brownstein of the "Los Angeles Times".

Let's talk about Social Security, Ron. You've got an intriguing title to your piece in the "L.A. Times" today. "Bush's budget moves have made the future a voiceless victim." What do you mean by that?

RON BROWNSTEIN, "LOS ANGELES TIMES": Well I think really both parties. We're talking about the cumulative effect of all the budget decisions that we've seen over the last few years leading into this debate over Social Security. If you look at what's happened we first voted ourselves a large tax cut for this generation, then we went out and added to that, added a new prescription drug benefit for today's seniors. Now we're talking about a Social Security reform that would require future generations to accept significant reductions in their guaranteed benefits.

All in all, the decisions we're making are allowing us to increase our consumption of government services today and paying less taxes while handing the future a big national debt that they're going to have to pay off. And at the same time telling them they may have to have their benefits cut. Not a good deal for people who aren't born yet.

WOODRUFF: But we see that even right now when you ask Americans in our latest poll -- you ask Americans what do they think of President Bush's Social Security -- handling of the issue of Social Security, 52 percent disapprove, 41 percent approve. Americans already see some flaws in what the president's talking about?

BROWNSTEIN: Well the president is trying to do two things at once. Either one of which is very difficult. Putting them together makes it more complicated, although the White House hopes they will reinforce each other. He wants to create individual accounts which could help young workers in the future offset some of these benefit reductions by allowing them to invest in stocks and bonds.

On the other hand he wants to reduce the long-term gap between Social Security's finances, between the amount of money that's coming in and the amount of money promised in benefits. The problem is that to do both of these things at once create a very complex political calculations. Because some of the legislators who might be attracted to the individual accounts are resistant to the benefits cuts and vice versa. So it's a very difficult challenge. When you start with numbers like that, Judy, the credibility you have to push through a reform like this is obviously compromised.

WOODRUFF: What are the politics that the White House is counting on to get this done?

BROWNSTEIN: Well I think what they're counting on is a realization among many people that something has to be done. Part of what I talk about in my column today is that I think both parties, including Democrats, have to recognize that if we allow Social Security Medicare, and Medicaid to go on the track they're on as a society ages they will eventually squeeze out and limit the government's ability it do anything else. The president is right that in the long run something has to be done.

Whether his solution is the right one is going to be the debate. But I think he has the potential to put Democrats on the defensive if they basically argue for no change, both because Social Security has a gap in its financing, but more broadly, can the government afford to get through a situation where 75 or 85 percent of the budget is devoted just to these three programs to the elderly. That's not a long term sustainable proposition.

WOODRUFF: What about the constituency that isn't being heard, the future generations? Your last sentence is, is there anyone who's going to speak for the future.

BROWNSTEIN: Interestingly someone answered me on Sunday. The Concord Coalition -- which is a group of deficit hawks from both parties -- put out a full page ad in newspapers saying that one principle of Social Security reform should be no new debt. Look, in the future because of the graying of society, younger workers are probably going to have to accept less benefits in Social Security or more taxes. That's inevitable.

But they shouldn't have to also pay off the debt that we are accumulating because we aren't willing to pay enough in taxes to fund the services and defense that we want. So one principle of Social Security reform might be no new debt. That would be the beginning of an agenda based generational fairness.

WOODRUFF: That would preclude the current Bush plan. But we can talk about that . . .

BROWNSTEIN: Part of the complicated politics.

WOODRUFF: Ron Brownstein, thank you very much. Always provocative, we appreciate it.

Well the Supreme Court is back in session, but will there be a new chief justice any time soon? Coming up, Bob Franken takes a look at the speculation surrounding the future of Chief Justice William Rehnquist. Stay with us.

(COMMERCIAL BREAK)

WOODRUFF: The Supreme Court opened its 2005 session today, but once again Chief Justice William Rehnquist was not present. Rehnquist was diagnosed with thyroid cancer in October. His illness has led to growing speculation about possible replacements. Our Bob Franken has more.

(BEGIN VIDEOTAPE)

BOB FRANKEN, CNN CORRESPONDENT (Voice over): He has worked briefly out of his court office in recent weeks, but the announcement from the bench was the same one that has proceeded each Supreme Court session, since Chief Justice William Rehnquist announced he had thyroid cancer. He could not be present but reserved the right to do his work at home. He's also reserved the right to swear in the president again at the inauguration in less than two weeks, and those who know him best say count on it.

JAY JORGENSEN, FMR. REHNQUIST LAW CLERK: He told the president that he would come and, you know, nobody takes their job more seriously than the current chief justice. So I expect to see him there, look forward to seeing him there.

FRANKEN: Court sources say that speculation about Rehnquist's retirement is premature, that nothing is imminent. But that hasn't slowed conjecture about Supreme Court replacements one bit. It puts the White House in a delicate spot. The president, any president, must avoid an impression he is trying to ease a justice out. But the administration has to be ready just in case. The counsel's office started a list of possible nominees early in the first Bush term. Associates past and present say no matter which name is chosen, the Democrats are ready for combat, but so is the president.

CHRIS BARTOLOMUCCI, FMR. WHITE HOUSE ASST. COUNSEL: President Bush is not afraid of a fight and will spend his political capital to see that his choice is confirmed to the high court.

(END VIDEOTAPE)

FRANKEN: Those same people who insist that Rehnquist is not about to give in to retirement without a battle agree that when the question of a Supreme Court replacement does come up, then we'll really see a battle. Judy.

WOODRUFF: But it's the when that no one truly knows.

FRANKEN: That's right.

WOODRUFF: Bob Franken', thank you very much. Appreciate it. The Democratic party is looking for a new leader. Coming up, we'll spotlight who is in the running to run the party. And I'll speak with one of the candidates, former Congressman Tim Roemer, whose stand on abortion might not sit well with some Democrats.

And later, President Bush has an ambitious domestic agenda he wants to Congress to pass, but will he be able to get any support from Democrats?

(COMMERCIAL BREAK)

WOODRUFF: It's a little before 4:00 on the East Coast 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, CNN ANCHOR: Judy, thank you. Stocks today failing to hold on to substantial early gains ending the day just barely higher. It was certainly not the recovery investors had been hoping for after last week's steep losses. The Dow last week tumbling nearly 200 points. As we near the closing bell the Dow Jones Industrials have gained 13.5 points. And the Nasdaq is a third of 1 percent higher. Investors are cautious as the market gears up for the quarterly earnings season which kicks off this week.

A bit win today for the doctors suing the HMO industry. The Supreme Court has refused to hear an appeal made by six HMOs. They wanted the justices to stop 600,000 doctors from joining forces in a class-action lawsuit against the HMOs. The justices' decision will allow the case to go to trial before a federal judge in Miami. Those HMOs include Humana, Prudential and WellPoint. They're accused of conspiring to underpay doctors for their services from 1990 to 2002.

Delta Airlines is making some desperate cuts trying to avoid bankruptcy. The carrier is reducing the number of flight attendants on some flights, but says it will still immediate or exceed FAA safety requirements. These cuts, Delta says, are designed to bring the airline's cost closer to low cost rivals. Just last week Delta ignited a fare war when it slashed ticket prices by as much as 50 percent.

General Motors is making cuts of its own as it faces rising health care costs and intense price competition. For the fourth year in a row, the car maker will slash jobs in the United States. Some reports say GM will eliminate up to 7 percent of its work force. That would amount to 8,000 jobs. GM says it hasn't decided on how many positions will be cut. Most however will be through attrition and retirement.

Coming up on CNN, at 6:00 p.m. Eastern on "LOU DOBBS TONIGHT," "Overmedicated Nation," our special report this week. Momentum building for an overhaul of the Food and Drug Administration. The latest drug problem to surface, AstraZeneca's cholesterol drug called Crestor has now been linked to a patient's death. It's just the most recent FDA approved drug to have a major problem, leading to mounting concerns about the effectiveness of the FDA and our drugs -- our nation's drug protection system.

(BEGIN VIDEO CLIP)

DAVID GRAHAM, FDA WHISTLEBLOWER: FDA is responsible for having harmed the American people, for having harmed countless number of people, having in a sense contributed to the deaths of tens of thousands of Americans because it has such a low bar on safety.

(END VIDEO CLIP)

DOBBS: Also tonight, rain and snow storms battering the west. A region plagued for years by a crippling drought. Will it bring relief? We'll have a special report.

Also new documents tonight on the United Nations Oil for Food scandal. Some of those documents show senior U.N. officials repeatedly warned that that $60 billion program was being mismanaged and in considerable trouble. We investigate. And Senator Carl Levin joins me. We'll be talking about U.S. policy in Iraq and the recent rise in violence ahead of the January 30 elections. Now back to Judy Woodruff in Washington.

WOODRUFF: Thank you, Lou. We'll be watching you at 6:00.

INSIDE POLITICS continues right now.

(BEGIN VIDEOTAPE)

ANNOUNCER: The race to run the Democratic party. Who's in, who's out and who is on the fence?

Can a politician who opposes abortion rights lead the party? We'll talk with a red-state Democrat who is in the running.

UNIDENTIFIED MALE: We must talk about our values. We must embrace people of faith in this party.

ANNOUNCER: Two crucial Middle East votes.

G.W. BUSH, PRESIDENT OF THE UNITED STATES: I'm (UNINTELLIGIBLE) by the elections and I'm also looking forward to the Iraqi elections on January the 30th.

ANNOUNCER: We'll take a look at what's at stake for President Bush.

Michael Moore and Mel Gibson praise each other. If they can get along, maybe there's hope that Democrats and Republicans can get along.

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

(END VIDEOTAPE)

WOODRUFF: Welcome back. It may not have the glitz of the early Oscar race or the roaring crowds of the football playoff, but in Democratic political circles the competition to be the next party chairman is the big event of the new year. The race is getting more interesting and crowded by the day, as party activists round out or found out that is during a meeting in Atlanta over the weekend.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: I think we lost because we didn't appear to know what we stood for.

WOODRUFF (voice-over): The Democrats, in what's becoming their quadrennial search for self, seeking focus and a new leader now that party chairman Terry McAuliffe's term is up.

A schmoozy Saturday in Atlanta where over fried chicken and greens, seven of McAuliffe's would-be successors pitched themselves to the party's southern wing, the most prominent among them, Howard Dean, who has yet to formally enter the race. Dean quickly put to rest concerns that he would use the chairman's position as a springboard for another White House bid.

HOWARD DEAN (D), FMR. PRESIDENTIAL CANDIDATE: If I get this job, I'm not running for president in 2008.

WOODRUFF: But does the Democratic party of 2005 need a northeastern liberal at its helm?

UNIDENTIFIED MALE: And I know that the Redneck Riviera is not in France.

WOODRUFF: Strategist Donnie Fowler who ran Wesley Clark's campaign and hails from South Carolina is one of several red states Dems in the running. He argues the party has abandoned huge swathes of the country.

DONNIE FOWLER, DNC CHAIR CANDIDATE: We're conceding the south, we're conceding the rocky mountain west, we're conceding religious voters, we're conceding rural voters and we're running out of voters.

WOODRUFF: The other prime red state contenders two former Congress members. Martin Frost of Texas and Tim Roemer of Indiana, who also served on the 9/11 commission. Roemer made his DNC bid official at Saturday's meeting emphasizing one of the buzz words of last year's presidential campaign.

TIM ROEMER, DNC CHAIR CANDIDATE: We must talk about our values. We must embrace people of faith in this party.

WOODRUFF: But Roemer presents Democrats with another thorny issue. He is anti-abortion rights, putting him at odds with the party's base. And therein lies the fundamental challenge for the new chairman.

SIMON ROSENBERG, DNC CHAIR CANDIDATE: We have to represent that we share America's values and we know we do. We cannot at the same time run away from our base.

WOODRUFF: Because says former Denver mayor, Wellington Webb, the only African-American in the running...

WELLINGTON WEBB, DNC CHAIR CANDIDATE: You don't compete in only 19 to 20 states, you compete in 50 states.

(END VIDEOTAPE)

WOODRUFF: Well, one other candidate of note we want to mention, former Ohio Democratic party chairman David Leland. Democrats will choose their new chairman next month.

Joining me now the latest Democrat to join the race for party chair, he is former congressman and former/11 commissioner Tim Roemer. Good to see you.

WOODRUFF: You talk about the need to Democrats to connect with the values of Americans. Which values are you talking about? Obviously, Americans across the country don't agree on everything.

TIM ROEMER, DNC CHAIR CANDIDATE: Judy, I don't want our party to be led by somebody that will veer it to the left and I don't intend, if I were to win, to steer it to the right. I think we need to connect the values that unite us as a Democratic party to the American people and talk to them about values like national security. The Bush administration has not caught Osama bin Laden, the axis of evil is stronger than ever, the Iraq war gets worse every day. That's not national security.

What about job security? What about good-paying jobs for American families. What about protecting Social Security and not letting people saw off the third leg of this stool of retirement and dismantle a system that Franklin Roosevelt put together for us. Those are security issues, Judy, that in 97 of the 100 fastest growing counties across the United States Democrats lost. We lost in those 97 fastest growing counties. We have to be able to talk about those principles and values and I think we need a better messenger, a better message and we need to work hard at modernizing our parties.

WOODRUFF: You are from the state of Indiana. It doesn't get much redder than that. Indiana is long gone Republican. Is the Democratic party really going to be comfortable with someone from a state that is so identified with the Republican party?

ROEMER: Listen, Judy, we need to win. We need to win elections and we can win elections on our bedrock principles and on our values even in states like Indiana. I beat a Republican incumbent in 1990, I held that seat for six races and then I went on to 9/11 commission and...

WOODRUFF: But when it comes to voting for the presidency, your home state consistently votes Republican.

ROEMER: But our party, Judy, our party voted for a Democratic governor in that state for 16 years. We had eight out of ten members of Congress. We have the same thing happening in Arkansas where we have two great United States Democratic senators and three out of four members of the House of Representatives as Democrats. We seem to be able to win in some local elections, but we can't convey the values and our principles in national elections.

WOODRUFF: Your position..

ROEMER: We need to do that in all states. Churchill said you don't win wars by evacuation. You can't evacuate the south and the midwest and you cannot give up on voters in the suburbs and subdivisions like the Democratic party has.

WOODRUFF: We hear you. Let me ask you about your position on abortion rights. You are anti-abortion rights. Are you in favor of overturning Roe versus Wade?

ROEMER: I'm very cognizant of the fact that our party, my party that I love is overwhelmingly pro-choice. I respect that position. As a Democrat that worked with the Clinton administration all through my years in Congress, I worked on ways to try to make sure that when a woman is in the position of an unwanted pregnancy, personal security, economic security issues are profoundly important. How do we support health programs? How do we support counseling programs? how do we support adoption programs that will encourage that birth into the world? And 11 percent of -- the abortion rate went down by 11 percent during that time period.

WOODRUFF: Are you in favor of overturning Roe versus Wade?

ROEMER: As the DNC chair, the DNC chair's position is not to go out there and overturn Roe v. Wade, it is to support Democratic candidates to win in elections and ultimately to support the people who vote for the platform of our party.

WOODRUFF: So you're not taking a position. Let me quote to you very quickly what Kate Michelman who formerly headed the pro-choice organization, NARAL. She said "Tim Roemer's candidacy for chairman of the party threatens the very principles for which the Democratic party has stood for many years. His views and record are closer to those of George Bush." She said, "We don't need a Republican as chair of the Democratic National Committee." She may run against you for party chair.

ROEMER: I welcome more voices in our party to talk about our values and our principles and how we can win elections by modernizing our state party organizations and being more competitive in more states. I think, Judy, we make a profound mistake as a party if we litmus test our candidates for office in the south or the midwest on one issue and say you can't be this member of our party.

All I want is a conversation. I don't want to try to change the party's principal direction on every single issue that Kate Michelman is worried about here. And lastly, Judy, I think the Democratic party, we're very good at attacking each other. We've got to make sure that we are fighting for our voters and fighting to win elections.

WOODRUFF: We hear you. Former Congressman Tim Roemer, running for chair of the Democratic National Committee. We thank you very much. And we'll be following the campaign. ROEMER: Always a pleasure to be with you.

WOODRUFF: We appreciate it. Thank you.

Overseas, Palestinians have cast their vote for a new leader. Up next, how the Palestinian election and the upcoming vote in Iraq provide crucial tests for President Bush.

Also ahead, how hard will Democrats butt heads with Republicans now that their minority status is even weaker than before?

And later, two movies, popular but polarizing. Are the filmmakers sending a message about political healing?

(COMMERCIAL BREAK)

WOODRUFF: Some election news from overseas. CNN can tell you that in Ukraine, the central election commission late today declared the western leading reformer candidate Viktor Yushchenko the winner of the presidential election in that country over Viktor Yanukovych, who of course was the Kremlin favorite candidate. The commission announced that the final tally of the voting that took place on December 26th was Yushchenko with 51.99 percent of the vote, Yanukovych 44.2 percent. So the election commission making it official in Ukraine.

As the United States, meantime, looks to the secure the scheduled election in Iraq at the end of the month, another high-profile Middle East election happened over the weekend. CNN's Bill Schneider has more on the election of a successor to Palestinian leader Yasser Arafat.

(BEGIN VIDEOTAPE)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: The month of January, 2005, is an extraordinary month.

WILLIAM SCHNEIDER, CNN SR. POLITICAL CORRESPONDENT (voice-over): Is President Bush talking about his inauguration? No. He's talking about two elections, both outside the United States. The Palestinian election last Sunday and the election in Iraq on January 30th. Those elections provide crucial tests of the Bush doctrine.

BUSH: See, free societies do not export terror.

SCHNEIDER: Can Sunday's Palestinian election be counted as a breakthrough for democracy? It looked like a real election.

HANNA NASSER, PALESTINIAN ELECTORAL COMM. (through translator): Mahmoud Abbas, Abu Mazen, representative of Fatah, received 483,039 votes, 62.3 percent of the vote.

SCHNEIDER: Although it was held under unusual circumstances.

SAEB ERAKAT, CHIEF PALESTINIAN NEGOTIATOR: This is an election under Israeli occupation. We're not an independent state. SCHNEIDER: Voting was difficult.

LORD KILGLOONEY, ELECTION OBSERVER: Nearly 200,000 Palestinians were denied the right to vote in East Jerusalem and that's bad.

SCHNEIDER: The election was supposed to be a choice between Hamas, the radical Islamic movement that embraces terrorism and refuses to recognize Israel, and Mahmoud Abbas, also known as Abu Mazen, who represents secular Palestinian nationalism. But Hamas did not participate, so how could the election have been a real choice? Because an estimated 60 percent or more of eligible Palestinians did vote and more than 60 percent voted for Abbas, whose position was clearly known.

SHIBLEY TELHAMI, UNIVERSITY OF MARYLAND: He, in the campaign,, ran on the nonviolence issue even if he knew it wasn't the one that's going to win him the election, given how divided the Palestinians were. But the fact that he did it and won anyway is going to give him the moral authority when he negotiates with Hamas to say I have the backing the people.

SCHNEIDER: In other words, a mandate. It was also a mandate for the Bush administration.

TELHAMI: Abu Mazen is singing the administration's songs, nonviolence and reform. He was seen as America's man. Certainly they have to cooperate with him.

(END VIDEOTAPE)

SCHNEIDER: The Palestinian election took place in a virtual country under military occupation with a major political force that refused to participate and it seems to have worked. The test will be similar, but a lot tougher, three weeks from now in Iraq. You know, our new poll shows President Bush losing support for his effort there. Just after the November election, 51 percent of Americans disapproved of the way President Bush was handling Iraq. Now, 56 percent disapprove.

WOODRUFF: And you're right, it's going to be a lot tougher in Iraq.

SCHNEIDER: Yes.

WOODRUFF: All the people who are over there and have reported back firsthand are to be believed.

SCHNEIDER: That's right. It's a lot more violent.

WOODRUFF: Bill Schneider, thanks very much.

Former president Jimmy Carter, by the way, was among the international observers monitoring yesterday's Palestinian elections. You can hear what he has to say on "WOLF BLITZER REPORTS" at 5:00 Eastern. Right here on CNN.

The Democrats are pledging to unite in opposition to the president. That story ahead on INSIDE POLITICS.

Up next, court battles keep hope alive for the write-in candidate, who almost won the race for San Diego mayor.

(COMMERCIAL BREAK)

WOODRUFF: Two reports from California lead off a new week of political bites. The widow of Congressman Bob Matsui is expected to announce this week that she will run for her late husband's seat in Congress. Doris Matsui is a Washington lobbyist and a veteran of the Clinton White House. A special election will be held to fill the seat. It was occupied for 26 years by her husband who died on New Year's Day.

Down the coast in San Diego, two lawsuits have been filed by supporters of mayoral write-in candidate Donna Frye as Mayor Dick Murphy prepares for tonight's state of the city address. The lawsuits claim that the city registrar was wrong to disqualify ballots on which voters wrote Frey's name but then failed to darken an adjoining oval. More than 5,000 write-in ballots were thrown out. Frey lost though by about 2,000 votes.

Here in Washington, Democrats are fewer in number than they were four years ago, but there are signs that they are more determined than ever to try to resist major planks in the president's second term agenda. Dan Balz writes about this in today's edition of the "Washington Post." He joins me now from the "Post" news room. What are you hearing from Democrats, Dan, in terms of their attitude toward the second term of President Bush's administration?

DAN BALZ, "WASHINGTON POST": Very interesting, Judy. Right after the election we talked so much about how Democrats were in disarray, how they were in a period of introspection and reflection and soul searching and to some extent that is all true but one of the things that's happened over the last six weeks or so is the Democrats have come together with the idea that the best thing they can do because they are such a minority party in the Congress right now is band together and unify in opposition to President Bush's major second term agenda. I think that their goal is to try to resist at every turn. There are a number of reasons for this, but out of this has come greater determination to bring the kind of energy and fervor that we saw during the campaign at the grassroots and that sort of anti- Bush sentiment that was so consistent through the campaign and now apply it to the legislative strategy going forward.

WOODRUFF: Dan, what's going to give them the heart to go after Bush when they've been beaten back worse than they were four years ago?

BALZ: I think one of the things that has happened is that they have seen from all the polling that has taken place over the last month or so that President Bush got very little bounce out of his re- election victory, that he's gotten no real honeymoon with the public. His approval ratings are about where they were throughout the campaign, which is to say not terribly strong, his policy on Iraq is now net negative in terms of public opinion approval. Similarly on his economic policy. So that they look at President Bush and they say, yes, he did win the election and he did beat us, but he has not significantly changed public opinion and so, therefore, they think he may be somebody that they can go after with political impunity.

WOODRUFF: So this is their wish, how well equipped are they to actually carry this out?

BALZ: That's the really important question. At this point, as you talk to Democrats, they acknowledge they're not terribly well equipped to do that. They've had a leadership change in the Senate, Senator Harry Reid is still getting his feet on the ground, that office is expected to be a locust of activity but they are not quite up and running yet. The House Minority Leader Nancy Pelosi intends to be active on this, but that House is run very tightly by the Republicans. The Democratic National Committee as you had on earlier this hour is in the middle of a leadership fight. There is no person at this point who can take that over and so they have got real leadership problems in trying to organize themselves.

WOODRUFF: And very quickly, Dan, they're not worried about looking obstructionist?

BALZ: They're worried a little bit, but I think one of the things they're worried about is not looking tough enough to their own supporters. They learned after the 2002 election that by not being tough in contesting those elections that they paid a price.

WOODRUFF: Dan Balz, we always appreciate you being on the program.

BALZ: Thanks.

WOODRUFF: From the "Washington Post" news room.

Well, you'll be hard pressed to name two movies more different than "The Passion of the Christ" and "Fahrenheit 9/11." Filmmakers Mel Gibson and Michael Moore have become poster boys for partisans on the right and the left. But do they have more in common than we think?

(COMMERCIAL BREAK)

WOODRUFF: In the quest for political healing after the 2004 election, there may be a new reason for optimism from a somewhat unlikely source. CNN's Jennifer Michael (ph) has more on Hollywood and the people's choice.

(BEGIN VIDEOTAPE)

JENNIFER MICHAEL, CNN CORRESPONDENT (voice-over): Two popular but controversial films spoke volumes about America's election year divide. "Fahrenheit 9/11" and "The Passion of Christ."

Could it be that the men behind those movies are fans of one another? Michael Moore and Mel Gibson crossed paths last night when their films both won top honors at the annual People's Choice Awards. "Fahrenheit 9/11" won favorite movie.

MEL GIBSON, ACTOR/DIRECTOR: I saw the film, I liked it. You know, I feel a kind of strange kinship with Michael.

MICHAEL: The "Passion of Christ" won in the favorite drama category.

MICHAEL MOORE, FILMMAKER: I saw it twice. I thought it was a powerful piece of filmmaking. I took my dad to see it.

GIBSON: They're trying to pit us against each other in the press but this is all just a hologram. We're used to some kind of divisive left/right thing.

MICHAEL: It may be easy to Moore and Gibson to be magmaninous both came out winners which never happens in presidential elections. But you didn't subtitles to get their message that maybe we can all get along. Jennifer Michael, CNN.

(END VIDEOTAPE)

WOODRUFF: And maybe we can. That's it for INSIDE POLITICS this Monday. 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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