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Inside Politics

Inaugural Donors; Interview With Former Mayor Wellington Webb; Political Blogs

Aired January 13, 2005 - 15:30   ET

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

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


(BEGIN VIDEOTAPE)
ANNOUNCER: One week until the president's inauguration. But who is paying for the big party? We'll take a look at which companies are handing over big bugs to pay for the festivities.

Who will be the next leader of the Democratic Party? We'll speak with one of the candidates and hear his strategy to put the Democrats back on top.

UNIDENTIFIED MALE: You don't compete in only 19 to 20 states. You compete in 50 states.

CARLOS WATSON, CNN POLITICAL ANALYST: They've increased in number from about 60,000 active political blogs to about 80,000.

ANNOUNCER: They played a prominent role in the race for the White House. But with the election over, will they still be a factor?

(END VIDEOTAPE)

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

JUDY WOODRUFF, CNN ANCHOR: Thank you for joining us. The United States policy on torture is back in the spotlight today. A short while ago, the defense rested its case in the court-martial of Army Specialist Charles Graner, accused of being the lead figure in the Abu Ghraib prison scandal in Iraq.

Graner did not testify in his own behalf as his defense team had once promised. The jury could get the case tomorrow after closing arguments.

Meantime, the Bush administration is denying a published report that it tried to water down legislation aimed at preventing extreme interrogation measures like those uncovered at Abu Ghraib. The White House charges that "The New York Times" story is the result of "politics and posturing by someone on Capitol Hill." We'll have much more on that later on INSIDE POLITICS.

In today's "Security Watch," President Bush is promising to stay vigilant in the war against terror. He went to the Pentagon today for a briefing on national security and tsunami relief efforts. The president offered renewed praise for Defense Secretary Donald Rumsfeld and for America's allies in the war on terror. (BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I am pleased with the response from around the world. I appreciate so many nations understanding that we must work together to defeat these killers. I'm mindful of the fact that we have constantly got to review our plans and never lose our will.

(END VIDEO CLIP)

WOODRUFF: Stay tuned to CNN day and night for the most reliable news about your security. Tonight on "WOLF BLITZER REPORTS," another angle on security, gang violence in America. Why is it up, and what are law enforcement officials doing about it? That's tonight at 5:00 Eastern here on CNN.

Well, now a more festive story here in Washington, the countdown to the social and political event of the season, or rather every four years. Just one week to go before President Bush's second inauguration.

Of course inaugural planners have been making preparations for many weeks. About 250,000 people are expected to gather at the Capitol to watch Mr. Bush take the oath of office. And there will be more crowds for the inaugural parade and the nine inaugural balls.

Private donations will cover the $40 million price tag for all the festivities, which do not include security costs. Some people, though, inside and outside the Beltway have grumbled about the scale of the celebrations during this time of war and of national -- or natural disaster.

Right now, let's talk more about who is footing the bill for the inauguration. We're joined by Thomas Edsall of "The Washington Post."

Tom Edsall, we were just saying the cost, $40 million and higher. Who is putting out most of this money?

THOMAS EDSALL, "WASHINGTON POST": Basically, you're getting almost the same groups and individuals who have paid for the Bush campaign, who paid for the Republican convention, who have been regular contributors to the RNC coming in. The Bush major donor universe is really dominated now by financial interests, especially those on Wall Street.

A second largest group is probably energy companies. And then there are a whole group -- network of donors, all of which -- or almost all of which are various interests with the government that they pursue and find contributing to be a very beneficial part of the process.

WOODRUFF: But the difference for the campaign is in the campaign there are limits. Now there are very high limits. They can give up to, what, $250,000. And I was reading in your story today, Tom, the Marriott Corporation, three of its different organs, if you will, giving $250,000 each. EDSALL: Yes. They set a voluntary limit. There are actually no legal limits at all on what could be given. But to keep things sort of semi under control, they set a $250,000 limit. But that is per -- what they describe as per entity.

So that means, for example, with Marriott, the Marriott Vacation Club could also give, and so could Ritz-Carlton, which is another -- which is owned by Marriott. That's one of a number of companies and individuals where you have multiple people or corporations from the same interest giving far more than the $225,000.

WOODRUFF: You mentioned Ameriquest as another company. You also mention the Nuclear Energy Institute. Why are these people giving as much as they are, Tom?

EDSALL: Well, the nuclear energy guys are quite open about it. So the Bush administration has been very supportive of nuclear energy. And they want to basically voice their thanks.

The finance industry has become a real Republican constituency during the Bush years. It used to be much more bipartisan. Now it's become very Republican.

A lot of that has to do with the tax cuts that have gone through that have been very beneficial to especially wealthy investors. And now the Social Security program, the proposed privatization, would -- could shift a lot of money to accounts that could be managed by Wall Street investment banking firms.

WOODRUFF: So it's, you say, in part to say thank you, but it's also potentially to curry thank you. Do these kinds of gifts pay off, Tom?

EDSALL: I think that what they do is keep you in the -- sort of in the ball game. And a lot of them say they do this as a gesture of good will and so forth. They say.

The fact is, if you talk to most people privately, it is an economic decision they're making. They're saying that it is worth the $250,000, $500,000, whatever to do this, that the benefits flowing to their company or their trade association are well worth that investment. And it is not a -- the good will and altruism often voiced is really the cover for real self-interest, which is part of the whole way government runs in many respects.

WOODRUFF: Tom, very quickly, where -- if a viewer wants to know who is giving how much, is there one Web site they can go to?

EDSALL: Yes. You can go to the Bush inaugural Web site. And I don't know exactly the Web address, but if you do Bush Inaugural Committee through Google, you'll get there. And then right on the cover it has donors, and they will list all the donors for you.

WOODRUFF: All right. We'll find that out and we'll share that with our audience. Tom Edsall with "The Washington Post." Very good piece of reporting. EDSALL: Thanks.

WOODRUFF: Thank you very much.

Well, just a few minutes ago on Capitol Hill, Senator John McCain weighed in on the new agreement between baseball players and owners to test for steroids. The deal announced earlier today calls for tougher penalties and suspensions for players caught using steroids, including first-time offenders. Senator McCain, who has been a leading critic for baseball for not acting sooner, says the deal is a good start.

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN (R), ARIZONA: I think it's significant progress. And it certainly travels quite a ways from the almost non-enforceable regimen that existed before. But I think most of us would like to see it a little tougher.

(END VIDEO CLIP)

WOODRUFF: President Bush, as you may recall, used his State of the Union Address last year to call for tougher measures against steroid use.

Well, these are heady days for Republicans here in Washington. While Democrats, they're working to regroup. Up next, we'll talk with another candidate for the top job at the DNC, former Denver Mayor Wellington Webb.

Plus, the power of blogs. Will they be as influential in the legislative battles ahead as they were in the presidential race?

And later, Vice President Cheney takes on critics of the administration's plans to reform Social Security.

(COMMERCIAL BREAK)

WOODRUFF: As the Democrats continue to debate their next course of political action, the race for party chairman continues to expand. With Howard Dean's official entry, the field has grown now to seven people, including former Congressman Tim Roemer and Martin Frost, along with former Denver mayor, Wellington Webb. Wellington Webb is with me here in Washington this afternoon to talk about his campaign to become the next Democratic Party leader.

Welcome. It's good to see you.

WELLINGTON WEBB, DNC CHAIR CANDIDATE: Thank you very much. Glad to be here.

WOODRUFF: Thank you very much. So now you were one of the first.

WEBB: That's correct. That's correct.

WOODRUFF: You and I were just talking about this, to announce that you were seriously a candidate for the job. But lately, the publicity seems to be going to Howard Dean, Tim Roemer, Martin Frost. Are you being overshadowed by these people?

WEBB: Oh, obviously not. Those are all inside the Beltway politicians that have been running before. So it -- if you've been running in local races before, you do it the old-fashioned way.

You start on the telephone calling all 447 delegates, and you encourage their support. You get encouraged by them. And you talk about your vision and your plan.

WOODRUFF: And what do you...

WEBB: And I think we have a plan that works for the Democratic Party. I think it's in three parts. First, to reform the party by placing more emphasis and structure and money and finances at the state party level. The DNC chairs, the vice chairs and DNC members are the most important element of the party.

I think the second part is the chair of this party has to be a spokesperson, one that is not afraid to stand up for Democratic issues. One that is willing to stand up and take on issues of privatization of Social Security, where we've practically eliminated elderly poverty in this country. We should be talking about privatization of Social Security is a bad thing. Twenty-two percent of the elderly that are in poverty now, that number would jump to 57 percent.

WOODRUFF: What are you hearing from party members when you call them up on the phone?

WEBB: Well, I'm hearing that I did a great job in the debate in Atlanta and in Orlando, and they look forward to seeing me in St. Louis. And some of them have endorsed my candidacy. And we look forward to February 12, the date of the election.

WOODRUFF: You are, obviously, at this point, the only African- Americans candidate in the race. To look at the lineup of everyone but you, you'd think this was a white man's political party. A lot...

WEBB: Well, I like to -- I like to think of it I'm the only one in the race with a mustache.

WOODRUFF: OK, we could talk about that. But, you know, you know very well there has been a lot of talk about whether Democrats have taken the African-American vote in this country for granted. Is that a problem for the Democratic Party?

WEBB: Well, the Democratic Party has to consistently go after all voters because we want to be a majority party in this nation. We know that the Democratic Party in the south has written off the South. Fifty-five percent of the voters that are African-American reside between Richmond and Houston. So we have to go after southern voters.

But I myself, I'm a westerner. We have to go after western voters. We need to be in the heartland of America everywhere from Oskaloosa, Iowa; to Manhattan, Kansas; to Mississippi. We need to be talking about the Democratic message and framing that message on economic issues. And we need to be standing up to the issues of a supreme court that will be taking on the issues that this party has valued for years. Issues of Roe versus Wade, issues of organized labor issues, issues of environmental issues. The party chair has to stand up and speak out on behalf of our constituents.

WOODRUFF: Let me quote somebody who -- from Colorado who I would have thought was a friend and a fan of yours. He's the former governor, Dick Lamm. He was quoted in the newspaper, "The Denver Post," last month as saying, "I hear a lot of doubts about Wellington Webb's candidacy. However talented as mayor, this is a pretty far stretch for somebody who needs a national base."

What do you say to him?

WEBB: Well, I say to my good friend Dick Lamm that as I surprised him as a cabinet member, we'll surprise him by winning the chairmanship of the Democratic Party. Because one thing about being from the West is people don't look for petty and greedy. They look for entitlement.

They look for do you have a vision and plan and can you cut it. And the more I talk to delegates, what they know is that we both have a vision, a plan. And I am a person who is willing to stand up for Democratic values.

We're willing to fight for labors issues, employee free choice act before the Congress. We're willing to stand up for that.

We're willing to stand up and put money in 50 states. And we need to start by focusing with working on issues in New Jersey, with their state chair, Bonnie Watson-Coleman...

WOODRUFF: Right.

WEBB: ... Kerry Donnelly (ph) in New Jersey -- in Virginia to get support for Mark Warner.

WOODRUFF: So you're counting those votes? And...

WEBB: So we're counting votes. And people have been responsive. Because I also believe that before you lead, you have to listen. And we're doing a lot of that as well.

WOODRUFF: Wellington Webb, the candidate for Democratic Party chair. Thank you very much for coming by.

WEBB: OK. Thank you.

WOODRUFF: We'll be watching your candidacy.

WEBB: All right. Thanks a lot.

WOODRUFF: Thanks very much. We appreciate it.

WEBB: Appreciate it. OK.

WOODRUFF: And a quick program note about the DNC race. Abortion rights activist Kate Michelman is also considering a run for Democratic Party leader. She will join me on INSIDE POLITICS tomorrow to talk about her plans.

We'll have a look at public priorities on the eve of a second Bush term. New poll results straight ahead.

Plus, John Kerry plans a one-on-one meeting with a European leader, a meeting that probably would not have happened during the presidential campaign.

We'll be right back.

(COMMERCIAL BREAK)

WOODRUFF: Checking the "Political Bytes" on this Thursday, add the name of Kansas Senator Sam Brownback to the list of Republicans who may be considering a run for the White House. Brownback's home state newspaper, "The Kansas City Star," notes the senator has made what it calls repeated trips to Iowa, as well as several stops in South Carolina, home to an early primary.

A poll by the Pew Research Center offers a snapshot of public priorities as we begin the second Bush term. Preventing new terror attacks is by far number one among Republicans, while the economy ranks similarly high among Democrats. The economy, Social Security and education rank next for Republicans, while Democrats place a high priority on expanding health insurance coverage, along with securing Medicare and education improvements.

It is worth noting that the president's high-profile calls to simplify the tax code limit lawsuit awards and make his tax cuts permanent all receive less than 50 percent among respondents from both parties. The president's Democratic rival, Senator John Kerry, continues his travels overseas. And tomorrow he's scheduled to meet with French president Jacque Chirac. It is a meeting that no doubt could not have happened during the presidential campaign given the spirited back-and-forth rhetoric over Kerry's ties to all things French.

The mainstream press is devoting a lot of attention to President Bush's second term agenda. And the same can be said about the Internet.

Web loggers, or bloggers, as they're called, are helping to stir up the debate. A little while ago I asked CNN political analyst Carlos Watson about the future of political blogs and how they appear to have taken on a life of their own.

(BEGIN VIDEOTAPE)

WATSON: They really do, Judy. I mean, they've increased in number from about 60,000 active political blogs to about 80,000. You now, according to at least one study, have north of 30 million people regularly reading them, and you're starting to see some key shifts in 2005 versus, say, 2004.

One key example being that instead of just focusing on influencing politics and campaigns, if you will, you now see them playing a role in big policy debates. So certainly on the issue of Social Security you're hearing a lot. Already on immigration there's been -- they've weighed in. And on the whole Abu Ghraib prisoner scandal, you're hearing them weigh in there as well. So at least that's one significant change versus 2004.

WOODRUFF: And I see you've discovered that they're not just focused on national politics and policies. It's local and state as well.

WATSON: Yes. I mean, you remember that the blogs really came to the fore with the presidential campaign and certainly even a little bit earlier with the Trent Lott scandal going back some two years in the U.S. Senate. But now you're beginning to see them play a role in some local mayoral races.

So look for their involvement in the race out in Los Angeles and maybe in New York, the big mayoral races. You also certainly will see them be very active in the New Jersey governor's race. Probably down in Virginia as well. So that's another interesting change for them.

One other thing. As they begin to have a bigger influence, they're no longer just trading words back and forth. But you're also starting to see a greater use of video clips or audio clips. You know, a clip perhaps of President Bush speaking, or a little streaming audio maybe of a Rush Limbaugh radio interview. So the blogs again are continuing to change and evolve pretty rapidly.

WOODRUFF: How do you measure their influence, Carlos? I mean, what -- is it just a matter of waiting to see what happens after a big news story breaks, seeing what the reaction is among the people who read the blogs and write for them?

WATSON: Well, you know, symbolically, you certainly have to look at what happened at CBS. It's in many ways as symbolic a changing of the guard or at least a shifting of the guard -- that may be more appropriate -- as we've seen. They were very involved in that National Guard story and in debunking it, to some extent. And so certainly CBS's announcement this past week in some ways says the blogs have stepped forward.

But I think you'll continue to see them not only share new information, but continue to analyze and "point out inconsistencies" in certain positions that people take. It's still a little bit wild and hairy if we're honest about it, and so some of the blogs are fairly credible, but others, you know, are shaky as any kind of day- old or month-old institution.

I would say that one of the folks who are becoming important here, Judy, are some of the blog search engines, like Technorati and Feedster, which are kind of the new Googles.

WOODRUFF: For those of us who are still new to the blog world, it helps to know what those search engines are. And finally, Carlos, what is -- what are these pod 'casts?

WATSON: Well, blogs were the thing that you learned about in 2003 and 2004, Judy. Let me be the first to tell people, some people about pod casting. In the same way that blogs allowed individuals from their homes to start sharing information via words, these pod casters now essentially are kind of amateur radio shows.

(END VIDEOTAPE)

WOODRUFF: You got that. Pod 'casts. We're going to get used to figuring out what that means.

Vice President Cheney makes a rare appearance before the cameras. Coming up, we'll tell you what he's up to.

Plus, is the inauguration too expensive? Should the millions of dollars needed to pay for festivities be spent elsewhere? We'll get the take from the left and the right ahead on INSIDE POLITICS.

(COMMERCIAL BREAK)

WOODRUFF: As we do every day at 4:00 on the East Coast when the markets get set to close on Wall Street, we are joined by Lou Dobbs in New York with "The Dobbs Report."

Hello there, Lou.

LOU DOBBS, HOST, "LOU DOBBS TONIGHT": Judy, thank you very much.

A late day sell-off right now in Wall Street as the market is closing, following an earnings warning by General Motors and a surge in oil prices today. Crude oil rising nearly $2 a barrel, selling above $48. As these final trades are being counted, the Dow Jones industrials plummeting down 114 points right. These numbers will consolidate over the next several minute. The Nasdaq is a percent lower on the day.

But Apple shares rallying after companies blow out earning's report. Apple's profit quadrupling from a year ago. And Wal-Mart is now on the offensive. The company has taken out full-page ads in more than 100 newspapers all across the country, the company defending how it treats its employees. The letter from the company's chief executive officer touts the company's diverse work force, its employee benefits and what it terms high wages. It also notes Wal-Mart plans to create more than 100,000 jobs in the United States this year. Wal- Mart has faced criticism, stemming from several lawsuits involving its labor practices.

Eli Lily is defending its Prozac drug in its own full-page ads in "The Wall Street Journal." In an open letter to patients and doctors, the company defends the safety of the anti-depression drug. A British medical journal recently printed documents from the drugmaker, allegedly linking Prozac with suicidal behavior. Lily says such results on Prozac have, in its words, "needlessly spread fear among patients." The United States may face a surge in Chinese imports. Commerce Secretary Don Evans says China's new tax on its exports is too small to protect U.S. producers from their Chinese competitors. Not much of a surprise there, really. China imposed that tariff under pressure from other nations, including the United States, as its global quotas expired at the beginning of the year and its exports began flooding world markets. Just yesterday the Commerce Department reported that the United States had posted a record $60 billion trade deficit during the month of November and our nation's largest trade deficit is, of course, is with China.

Coming up on CNN here at 6:00 p.m. Eastern on "LOU DOBBS TONIGHT," our special report, "Overmedicated Nation" tonight will investigate the increasingly close relationship between the pharmaceutical industry and members of Congress. Critics say Congress can't be trusted to put public safety ahead of large campaign contributions.

(BEGIN VIDEO CLIP)

REP. SHERROD BROWN (D), OHIO: The relationship between Congress and the industry has never been like this. We've never seen this kind of corruption. We've never seen the drug industry have the kind of influence it's had in Congress, where it always gets its way.

(END VIDEO CLIP)

DOBBS: Also tonight, there is growing resistance to President Bush's plan to give legal status to millions of illegal aliens. Tonight we take a look at the rift within the Republican party over the issue of immigration reform.

Also, we'll heading to Seattle, where a special government commission is looking into the health of our country's high technology industry. Plenty of high-tech workers warning that pre-trade with China is simply killing the technology industry in this country.

And Republican congressman is at odds with the Bush White House on at least two major issues. Congressman Mike Pence joins me tonight to explain why he opposes the new Medicare drug benefit and No Child Left Behind. We'll have all of that and a great deal more here on CNN tonight at 6:00 p.m. Eastern.

Now, back to Judy Woodruff -- Judy.

JUDY WOODRUFF, CNN ANCHOR: Thanks, Lou. Interesting to hear a member of Congress talking so openly about corruption in the influence. Thanks very much. We'll be watching at 6:00.

INSIDE POLITICS continues right now.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: The whole issue of torture has been such a blot on everything this country stands for. ANNOUNCER: New poll numbers show that Americans agree. But do you think the prisoner abuse scandal is putting our own troops in greater danger?

Is it a project out of control?

UNIDENTIFIED MALE: That has become a classic money pit.

ANNOUNCER: Or was the original price tag way too low? The Capital Visitors Center controversy is in our spotlight.

Should Laura Bush take a more active role in her husband's business? The results of our new poll may surprise you.

UNIDENTIFIED MALE: Once again, we're seeing a partisan split, even though we're asking about Laura Bush, not George Bush.

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

(END VIDEOTAPE)

WOODRUFF: Welcome back. Questions are resurfacing today about how aggressively the Bush administration has acted in protecting detainees in U.S. custody from torture. As we reported earlier, the White House is denying that it tried as recently as last month to dilute proposed rules against extreme interrogation techniques.

Our senior political analyst Bill Schneider looks at where the president and the people stand on this issue.

(BEGIN VIDEOTAPE)

WILLIAM SCHNEIDER, CNN SR. POLITICAL ANALYST (voice-over): Do Americans see any gray area on the issue of torture? President Bush does not.

SCOTT MCCLELLAN, WHITE HOUSE PRESS SECRETARY: We do not condone the use of torture period and he would never authorize torture.

SCHNEIDER: In the immediate aftermath of 9/11, however, the administration had to make some tough choices.

ALBERTO GONZALES, ATTORNEY GENERAL NOMINEE: After the attacks of 9/11, our government had fundamental decisions to make concerning how to apply treaties and U.S. law to an enemy that does not wear a uniform, owes no allegiance to any country, is not a party to any treaties, and most importantly, does not fight according to the laws of war.

SCHNEIDER: In October 2001, the CNN/"USA Today/Gallup poll asked Americans if they would allow to U.S. government to torture known terrorists who knew details about future attacks. Here was the gray area. At a time of intense fear and anger, nearly half of Americans, 45 percent, said yes. But a majority still said no. Since that terrible time, public anxiety has diminished. Moreover, people know about what happened at Abu Ghraib.

SEN. EDWARD KENNEDY (D), MASSACHUSETTS: The whole issue of torture is been such a block on everything this country stands for and what we represent.

SCHNEIDER: The public agrees. Two-thirds feel the incident has damaged the U.S. reputation around the world for protecting civil liberties. It's not just an image problem. Most Americans believe that as a result of Abu Ghraib, U.S. soldiers are now in greater danger of being tortured if they are captured. The gray area has become a little clearer. Now, nearly 60 percent say the government should not be able to torture known terrorists, even if they know details about future attacks.

(END VIDEOTAPE)

SCHNEIDER: Unlike torture, assassination of known terrorists has never been a gray area. More than three quarters of Americans accepted it in October 2001 and nearly two-thirds still do now -- Judy.

WOODRUFF: Bill, how do you explain the evolution of public opinion on this?

SCHNEIDER: Yes. Well, anxiety has diminished a bit, but interestingly, right now the endorsement of torture has very, very little to do with whether you fear additional terrorist attacks. It has a lot more to do with your basic values in politics and your basic outlook. For instance, there's a big difference between men and women.

But when we asked about all the specific torture tactics that have been reported and witnesses in Afghanistan, Iraq and Guantanamo, Americans were pretty unanimous. They rejected all of them.

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

And our polling does suggest that President Bush still has a good deal of work to do to sell Americans on his plan to partially privatize Social Security. Today Vice President Cheney took on critics of the administration's reform plan.

Let's bring in now our White House Correspondent, Dana Bash. Hi, Dana.

DANA BASH, CNN WHITE HOUSE CORRESPONDENT: Hi, Judy. And what we are seeing this week is the beginning of a massive effort by the White House to convince Americans that Social Security is a system that needs to be reformed. The president held an event on Tuesday, the Treasury Secretary John Snow went up to New York to visit Wall Street for a couple of days this week. Josh Bolten, the OMB director, is going to go to the Chamber of Commerce on Friday and, of course, today was the vice president's turn.

The White House knows, Judy, its initial task is basic, but it's really a big challenge and that is to get the attention of the American people and, of course, by extension, the attention of Congress and convince them that Social Security is going to go into the red in 2018 and that the important thing is to fix it now.

(BEGIN VIDEO CLIP)

The year 2018 may seem like a long way off and in politics, there's always a temptation to kick the can down the road, hoping that long-term problems might simply disappear or leaving them for someone else to worry about. That is not how President Bush views his job.

(END VIDEO CLIP)

BASH: Now, there are a lot of skeptical members of Congress, including those in the president's own party, who think that they could pay a political price for supporting reform, especially anything that cuts benefits. But the Bush mantra has been -- Judy, you know that he will use his political capital to push for this and push hard for it. But the White House aides understand that the president, of course, won, but it wasn't necessarily on the Social Security issue.

We have some new polling from the Pew Center that certainly backs that up. Take a look at this. Social Security, when you ask if it needs to be completely rebuilt, only 15 percent say yes. Major changes, 34 percent say yes and minor changes, only 47 percent say yes. So we don't have the graphic there, but this poll does show that the president does have a lot of work to do to convince the American people that there does need to be even minor changes in the Social Security program.

Now, political team, the communications team here, Judy, they're working on this massive effort and it's not just for the president to get out there and his top aides to travel the country, which we will see, but it's also to try employ some of the things they learned, in terms of communications, during the campaign. To use targeted media like the Internet, to use regional media and other tactics to really try to get at the American people and to try to convince them that Social Security needs to be reformed and to do it by creating private accounts for younger workers.

If you thought political ads were out with the campaign with election day, you're wrong. Of course, there are some ads coming out already on this issue. Outside groups like one you're seeing now from the Progress For America is already using ads using Franklin Roosevelt's image, something his grandson has objected to.

(BEGIN VIDEO CLIP)

AD ANNOUNCER: Washington must strengthen Social Security, no changes for those at or near retirement, but younger workers should have the option of a personal savings account. Call Congress today. Urge them to strengthen Social Security for everyone.

(END VIDEO CLIP)

BASH: And we're going to see other outside groups with other big campaign efforts like the Club For Growth. They say they're going to announce something in the next few weeks. Judy, the bottom line is the White House knows that they have major opposition and outside groups, the AARP is already saying that they are going to have a massive effort that has already started. They know that they have to have a campaign bigger even than what we saw in 2001, 2003 for the president to push his tax cut plan.

WOODRUFF: But you're right, Dana, we didn't hear nearly as much about Social Security during the campaign as we're hearing about it now. OK, Dana Bash, thank you very much.

BASH: Thank you.

WOODRUFF: With just one week and counting until inauguration day, should the Bush administration tone down the cost and the glitz of the ceremony this time around? I'll ask Bay Buchanan and Ann Lewis.

Speaking of big bucks project, we'll look at the controversial construction of a new visitor's center in Washington.

And later, she appeals to people of all political stripes. Does that change when Laura Bush talks about policy?

(COMMERCIAL BREAK)

WOODRUFF: With me now Ann Lewis, communications director for Senator Hillary Clinton's political action committee and Bay Buchanan, president of American Cause. Wonderful to see both of you. Let's start with Iraq. The elections. We're are, Bay, hearing more from the Bush administration about obstacles, challenges to expect -- people shouldn't expect things to go perfectly, are they deliberately now trying to lower expectations do you think?

BAY BUCHANAN, AMERICAN CAUSE: There's no question they are. Which is smart. All of us are hoping for this great turnout and a terrific statement, which shows that Iraq has moved a giant step forward. But we can't expect that. We should be expecting small steps. There are some trouble spots, maybe even more so than we hoped at this time, but we are going to take the step, which is the important thing.

WOODRUFF: Will that help them come election day?

ANN LEWIS, CLINTON PAC COMMUNICATIONS DIRECTOR: This is one more disappointing look back at what is wrong with our policy in Iraq. We went in there because there was weapons of mass destruction and now we hear finally after so many hundreds of millions of dollars were spent, no weapons of mass destruction. We were told, yes, but we will establish democracy in the Middle East, that's very important. Listen, I feel strongly about establishing democracy, but now we're walking back from the election and we're told it doesn't matter how many numbers participate. Time after time, what the American people were told and the reasons have been changed. Judy, I would call this moving the goal posts except we have more than 1,000 Americans who have lost their lives. It's not a game. BUCHANAN: That's not the case whatsoever. We are having elections and transferred power over there to the Iraqi people and we're having the first set of elections. It's a positive, positive step.

WOODRUFF: I want to talk about the cost of the inaugural. There are some critics who are saying, hey, this is just out of control. $40 million and up and that doesn't even count the security. That's for the parties, the parade and so forth. What is excessive and what is appropriate?

LEWIS: Well, I was thinking about this because there was two parts of an inaugural and the first part is solemn celebration of democracy. The oldest continuing democracy, yes, even in war-time, of course we inaugurate a president, that is very important. That must go on. It should go on that the appropriate level, but the second piece, the parties. The glitz. The three days of parties and the $40 million that's being donated by corporate lobbyists I think at a time when our government still pays the families of troops who are lost in battle what $12,000? That's a death benefit? To talk about $40 million, I think that's out of line.

BUCHANAN: Inaugurals are expensive, Clinton spent $33 million a number of years back. I believe this is not the proper time to have a $40 million inaugural, my personal opinion. I think we have a time we are at war, I think we've just seen the greatest natural disaster in our lifetimes for sure and if not longer. It's a time that I think the president should continue. He has a very good rapport with the American people and they feel comfortable with him and we realize these are tough times and I think don't think it is appropriate for him to be out there in this kind of regal ceremony. It should be much more down to earth in my personal opinion.

WOODRUFF: Social Security. It's a huge topic, but in just a few words, is it smart for the president to be pushing the kind of reform that we gather he is pushing right now, Ann?

LEWIS: I will say he's wrong. There is no crisis. Repeat the people who are telling us it is a crisis now are the people who were telling us there were weapons of mass destruction. George Bush wants to lower the Social Security benefits by 25 percent, that's wrong. The market goes down again today by 100 points. That's insecurity, it's a mistake. I don't think we'll do it.

BUCHANAN: I give the president credit. He's bold. He's got a second term here and he's coming out saying I have a lot of ideas that are fresh, I want to throw them on the table. Let's have a dialogue. Social Security is one of them. He's saying, look, I don't know the whole answer, but let's give the young people in this country a chance to invest themselves and maybe make more money than we were able to. Let's discuss the answers and all you hear from the Democrats is bad idea, no. But you don't hear any new ideas. Increase taxes so we can solve this problem. That's not the answer.

WOODRUFF: We have to leave it there, but I know this is something we will be coming back to. Well, is it the best solution for crowds of tourists or is it just a smaller version of the big dig. Up next, the rising costs of the Capitol Visitor's Center, overbudget and behind schedule. Right outside the front door of Congress.

(COMMERCIAL BREAK)

WOODRUFF: This story just in to CNN. The Associated Press is reporting that leaders of a Senate committee have directed the Department of Education to turn over records of its public relations contracts at the same time reminding the secretary of education of a federal ban on so-called propaganda.

Now this request comes after revelations that we've been reporting on for days, that is that the Bush administration paid Armstrong Williams, a prominent black media commentator, to promote the new education law that had been strongly supported by the president.

Also today, we want you to know that a commissioner, a member of the Federal Communications Commission is calling for an investigation into the Williams story.

Meantime, when Congress approved an underground visitor center on Capitol Hill, it seemed like the perfect solution for tourists and government workers alike. With the project now well under way, CNN congressional correspondent Joe Johns reports that the visitor's center has become a budget black hole.

(BEGIN VIDEOTAPE)

JOE JOHNS, CNN CORRESPONDENT (voice-over): Critics say the project is out of control, complaining that an underground visitor senator being built at the U.S. Capitol is well overbudget and behind schedule.

REP. JIM MORAN (D), VIRGINIA: It has become a classic money pit, it's frustrating, we can't get our arms around, we can't seem to figure out how to keep the costs under better control and the time and the budget deadlines just seem to continue to slip.

JOHNS: It will be the underground entry point for visitors to the Capitol, with better security and more space for both the tourists and the Congress, construction has been going on two years. The current budget for the project is $454 million and an analysis by the General Accounting Office last month suggested it could cost more than $558 million, twice the anticipated cost when the center was conceived. With completion now expected for the fall of 2006, it could come in up to six months behind schedule.

The man overseeing the project is Alan Hantman, the architect of the Capitol. He says changes in the design and scope of the project, especially to make it safer, upped the cost and delayed the completion.

ALAN HANTMAN, U.S. CAPITOL ARCHITECT: With the magnitude of the changes that have been imposed and sanctioned by the Congress in this project, it is impossible to have met the original schedules or to meet the original budget criteria.

JOHNS: But the accounting office analysis said low-cost estimates, indecision and incomplete designs also have affected the price tags. An expert on government contracting sees this as an example of how some federal projects run into the red due to lack of discipline.

STEVE SCHOONER, GEORGE WASHINGTON UNIV.: So if you're not really worried about maintaining budget discipline, if you're not worried about having an overrun, then what you do is you estimate low, you make promises that you may not be able to keep and you realize that later you'll be able to deal with it by simply saying, well, we hadn't worried about this contingency.

JOHNS (on camera): For some budget hawks in both parties, the price tag for the visitor's center is a real embarrassment, but there is no way out because so much has already been put into the project that scaling back now is not an option.

Joe Johns, CNN, Capitol Hill.

(END VIDEOTAPE)

WOODRUFF: Thank you, Joe.

Well, President Bush may be the star of next week's inaugural festivities, but it will also be an opportunity for Laura Bush to shine. Coming up, does the first ladies' appeal transcend politics? Not necessarily.

(COMMERCIAL BREAK)

WOODRUFF: President Bush is said to like to tell people how he "married up." And polling shows you don't have to be a fan of his to be a fan of hers. CNN's Jennifer Michael looks at the latest evidence of Mrs. Bush's appeal and whether she's bringing Americans together.

(BEGIN VIDEOTAPE)

JENNIFER MICHAEL, CNN CORRESPONDENT (voice-over): Her husband may be a politically divisive figure, but almost everyone seems to like Laura Bush. Our new poll shows 85 percent of Americans approve of the way she's handling her job.

KEATING HOLLAND, CNN POLLING DIRECTOR: It's higher than any other approval rating we've recorded for a first lady. But there's an asterisk on that. No poll asked ever asked an approval for Laura's mother-in-law, a Barbara Bush, so we don't know how many people approve of the first Mrs. Bush when she was in the White House.

MICHAEL: It's easy to make some guesses about why people find Laura Bush so appealing. She is attractive, always poised and rarely controversial, but occasionally she goes out on a limb and comments on administration policy. LAURA BUSH, FIRST LADY: Everyone supports stem cell research and so did the president.

MICHAEL: Should Mrs. Bush speak out on issues more often? Americans are split. And on this question the first lady is more politically polarizing. Most Republicans do not want her to get more involved in promoting policy. Most Democrats do. It's not just a party thing, a majority of men think Mrs. Bush should remain quiet about issues, a majority of women want her to be more outspoken. That could say something about the way men and women view politics or about the way they view women's roles. A decade's long discussion that probably will continue long after the Bushes leave the White House.

Jennifer Michael, CNN.

(END VIDEOTAPE)

WOODRUFF: And that's it for INSIDE POLITICS this Thursday. Tomorrow, a special inside look at a lesser known member of the Kennedy family, Rosemary, who died last week. I'll talk with Eunice Shriver, her sister, and Tim Shriver, her nephew, about the life of Rosemary and how her disability inspired the Special Olympics.

I'm Judy Woodruff, "CROSSFIRE" starts right now.

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


Aired January 13, 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: One week until the president's inauguration. But who is paying for the big party? We'll take a look at which companies are handing over big bugs to pay for the festivities.

Who will be the next leader of the Democratic Party? We'll speak with one of the candidates and hear his strategy to put the Democrats back on top.

UNIDENTIFIED MALE: You don't compete in only 19 to 20 states. You compete in 50 states.

CARLOS WATSON, CNN POLITICAL ANALYST: They've increased in number from about 60,000 active political blogs to about 80,000.

ANNOUNCER: They played a prominent role in the race for the White House. But with the election over, will they still be a factor?

(END VIDEOTAPE)

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

JUDY WOODRUFF, CNN ANCHOR: Thank you for joining us. The United States policy on torture is back in the spotlight today. A short while ago, the defense rested its case in the court-martial of Army Specialist Charles Graner, accused of being the lead figure in the Abu Ghraib prison scandal in Iraq.

Graner did not testify in his own behalf as his defense team had once promised. The jury could get the case tomorrow after closing arguments.

Meantime, the Bush administration is denying a published report that it tried to water down legislation aimed at preventing extreme interrogation measures like those uncovered at Abu Ghraib. The White House charges that "The New York Times" story is the result of "politics and posturing by someone on Capitol Hill." We'll have much more on that later on INSIDE POLITICS.

In today's "Security Watch," President Bush is promising to stay vigilant in the war against terror. He went to the Pentagon today for a briefing on national security and tsunami relief efforts. The president offered renewed praise for Defense Secretary Donald Rumsfeld and for America's allies in the war on terror. (BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I am pleased with the response from around the world. I appreciate so many nations understanding that we must work together to defeat these killers. I'm mindful of the fact that we have constantly got to review our plans and never lose our will.

(END VIDEO CLIP)

WOODRUFF: Stay tuned to CNN day and night for the most reliable news about your security. Tonight on "WOLF BLITZER REPORTS," another angle on security, gang violence in America. Why is it up, and what are law enforcement officials doing about it? That's tonight at 5:00 Eastern here on CNN.

Well, now a more festive story here in Washington, the countdown to the social and political event of the season, or rather every four years. Just one week to go before President Bush's second inauguration.

Of course inaugural planners have been making preparations for many weeks. About 250,000 people are expected to gather at the Capitol to watch Mr. Bush take the oath of office. And there will be more crowds for the inaugural parade and the nine inaugural balls.

Private donations will cover the $40 million price tag for all the festivities, which do not include security costs. Some people, though, inside and outside the Beltway have grumbled about the scale of the celebrations during this time of war and of national -- or natural disaster.

Right now, let's talk more about who is footing the bill for the inauguration. We're joined by Thomas Edsall of "The Washington Post."

Tom Edsall, we were just saying the cost, $40 million and higher. Who is putting out most of this money?

THOMAS EDSALL, "WASHINGTON POST": Basically, you're getting almost the same groups and individuals who have paid for the Bush campaign, who paid for the Republican convention, who have been regular contributors to the RNC coming in. The Bush major donor universe is really dominated now by financial interests, especially those on Wall Street.

A second largest group is probably energy companies. And then there are a whole group -- network of donors, all of which -- or almost all of which are various interests with the government that they pursue and find contributing to be a very beneficial part of the process.

WOODRUFF: But the difference for the campaign is in the campaign there are limits. Now there are very high limits. They can give up to, what, $250,000. And I was reading in your story today, Tom, the Marriott Corporation, three of its different organs, if you will, giving $250,000 each. EDSALL: Yes. They set a voluntary limit. There are actually no legal limits at all on what could be given. But to keep things sort of semi under control, they set a $250,000 limit. But that is per -- what they describe as per entity.

So that means, for example, with Marriott, the Marriott Vacation Club could also give, and so could Ritz-Carlton, which is another -- which is owned by Marriott. That's one of a number of companies and individuals where you have multiple people or corporations from the same interest giving far more than the $225,000.

WOODRUFF: You mentioned Ameriquest as another company. You also mention the Nuclear Energy Institute. Why are these people giving as much as they are, Tom?

EDSALL: Well, the nuclear energy guys are quite open about it. So the Bush administration has been very supportive of nuclear energy. And they want to basically voice their thanks.

The finance industry has become a real Republican constituency during the Bush years. It used to be much more bipartisan. Now it's become very Republican.

A lot of that has to do with the tax cuts that have gone through that have been very beneficial to especially wealthy investors. And now the Social Security program, the proposed privatization, would -- could shift a lot of money to accounts that could be managed by Wall Street investment banking firms.

WOODRUFF: So it's, you say, in part to say thank you, but it's also potentially to curry thank you. Do these kinds of gifts pay off, Tom?

EDSALL: I think that what they do is keep you in the -- sort of in the ball game. And a lot of them say they do this as a gesture of good will and so forth. They say.

The fact is, if you talk to most people privately, it is an economic decision they're making. They're saying that it is worth the $250,000, $500,000, whatever to do this, that the benefits flowing to their company or their trade association are well worth that investment. And it is not a -- the good will and altruism often voiced is really the cover for real self-interest, which is part of the whole way government runs in many respects.

WOODRUFF: Tom, very quickly, where -- if a viewer wants to know who is giving how much, is there one Web site they can go to?

EDSALL: Yes. You can go to the Bush inaugural Web site. And I don't know exactly the Web address, but if you do Bush Inaugural Committee through Google, you'll get there. And then right on the cover it has donors, and they will list all the donors for you.

WOODRUFF: All right. We'll find that out and we'll share that with our audience. Tom Edsall with "The Washington Post." Very good piece of reporting. EDSALL: Thanks.

WOODRUFF: Thank you very much.

Well, just a few minutes ago on Capitol Hill, Senator John McCain weighed in on the new agreement between baseball players and owners to test for steroids. The deal announced earlier today calls for tougher penalties and suspensions for players caught using steroids, including first-time offenders. Senator McCain, who has been a leading critic for baseball for not acting sooner, says the deal is a good start.

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN (R), ARIZONA: I think it's significant progress. And it certainly travels quite a ways from the almost non-enforceable regimen that existed before. But I think most of us would like to see it a little tougher.

(END VIDEO CLIP)

WOODRUFF: President Bush, as you may recall, used his State of the Union Address last year to call for tougher measures against steroid use.

Well, these are heady days for Republicans here in Washington. While Democrats, they're working to regroup. Up next, we'll talk with another candidate for the top job at the DNC, former Denver Mayor Wellington Webb.

Plus, the power of blogs. Will they be as influential in the legislative battles ahead as they were in the presidential race?

And later, Vice President Cheney takes on critics of the administration's plans to reform Social Security.

(COMMERCIAL BREAK)

WOODRUFF: As the Democrats continue to debate their next course of political action, the race for party chairman continues to expand. With Howard Dean's official entry, the field has grown now to seven people, including former Congressman Tim Roemer and Martin Frost, along with former Denver mayor, Wellington Webb. Wellington Webb is with me here in Washington this afternoon to talk about his campaign to become the next Democratic Party leader.

Welcome. It's good to see you.

WELLINGTON WEBB, DNC CHAIR CANDIDATE: Thank you very much. Glad to be here.

WOODRUFF: Thank you very much. So now you were one of the first.

WEBB: That's correct. That's correct.

WOODRUFF: You and I were just talking about this, to announce that you were seriously a candidate for the job. But lately, the publicity seems to be going to Howard Dean, Tim Roemer, Martin Frost. Are you being overshadowed by these people?

WEBB: Oh, obviously not. Those are all inside the Beltway politicians that have been running before. So it -- if you've been running in local races before, you do it the old-fashioned way.

You start on the telephone calling all 447 delegates, and you encourage their support. You get encouraged by them. And you talk about your vision and your plan.

WOODRUFF: And what do you...

WEBB: And I think we have a plan that works for the Democratic Party. I think it's in three parts. First, to reform the party by placing more emphasis and structure and money and finances at the state party level. The DNC chairs, the vice chairs and DNC members are the most important element of the party.

I think the second part is the chair of this party has to be a spokesperson, one that is not afraid to stand up for Democratic issues. One that is willing to stand up and take on issues of privatization of Social Security, where we've practically eliminated elderly poverty in this country. We should be talking about privatization of Social Security is a bad thing. Twenty-two percent of the elderly that are in poverty now, that number would jump to 57 percent.

WOODRUFF: What are you hearing from party members when you call them up on the phone?

WEBB: Well, I'm hearing that I did a great job in the debate in Atlanta and in Orlando, and they look forward to seeing me in St. Louis. And some of them have endorsed my candidacy. And we look forward to February 12, the date of the election.

WOODRUFF: You are, obviously, at this point, the only African- Americans candidate in the race. To look at the lineup of everyone but you, you'd think this was a white man's political party. A lot...

WEBB: Well, I like to -- I like to think of it I'm the only one in the race with a mustache.

WOODRUFF: OK, we could talk about that. But, you know, you know very well there has been a lot of talk about whether Democrats have taken the African-American vote in this country for granted. Is that a problem for the Democratic Party?

WEBB: Well, the Democratic Party has to consistently go after all voters because we want to be a majority party in this nation. We know that the Democratic Party in the south has written off the South. Fifty-five percent of the voters that are African-American reside between Richmond and Houston. So we have to go after southern voters.

But I myself, I'm a westerner. We have to go after western voters. We need to be in the heartland of America everywhere from Oskaloosa, Iowa; to Manhattan, Kansas; to Mississippi. We need to be talking about the Democratic message and framing that message on economic issues. And we need to be standing up to the issues of a supreme court that will be taking on the issues that this party has valued for years. Issues of Roe versus Wade, issues of organized labor issues, issues of environmental issues. The party chair has to stand up and speak out on behalf of our constituents.

WOODRUFF: Let me quote somebody who -- from Colorado who I would have thought was a friend and a fan of yours. He's the former governor, Dick Lamm. He was quoted in the newspaper, "The Denver Post," last month as saying, "I hear a lot of doubts about Wellington Webb's candidacy. However talented as mayor, this is a pretty far stretch for somebody who needs a national base."

What do you say to him?

WEBB: Well, I say to my good friend Dick Lamm that as I surprised him as a cabinet member, we'll surprise him by winning the chairmanship of the Democratic Party. Because one thing about being from the West is people don't look for petty and greedy. They look for entitlement.

They look for do you have a vision and plan and can you cut it. And the more I talk to delegates, what they know is that we both have a vision, a plan. And I am a person who is willing to stand up for Democratic values.

We're willing to fight for labors issues, employee free choice act before the Congress. We're willing to stand up for that.

We're willing to stand up and put money in 50 states. And we need to start by focusing with working on issues in New Jersey, with their state chair, Bonnie Watson-Coleman...

WOODRUFF: Right.

WEBB: ... Kerry Donnelly (ph) in New Jersey -- in Virginia to get support for Mark Warner.

WOODRUFF: So you're counting those votes? And...

WEBB: So we're counting votes. And people have been responsive. Because I also believe that before you lead, you have to listen. And we're doing a lot of that as well.

WOODRUFF: Wellington Webb, the candidate for Democratic Party chair. Thank you very much for coming by.

WEBB: OK. Thank you.

WOODRUFF: We'll be watching your candidacy.

WEBB: All right. Thanks a lot.

WOODRUFF: Thanks very much. We appreciate it.

WEBB: Appreciate it. OK.

WOODRUFF: And a quick program note about the DNC race. Abortion rights activist Kate Michelman is also considering a run for Democratic Party leader. She will join me on INSIDE POLITICS tomorrow to talk about her plans.

We'll have a look at public priorities on the eve of a second Bush term. New poll results straight ahead.

Plus, John Kerry plans a one-on-one meeting with a European leader, a meeting that probably would not have happened during the presidential campaign.

We'll be right back.

(COMMERCIAL BREAK)

WOODRUFF: Checking the "Political Bytes" on this Thursday, add the name of Kansas Senator Sam Brownback to the list of Republicans who may be considering a run for the White House. Brownback's home state newspaper, "The Kansas City Star," notes the senator has made what it calls repeated trips to Iowa, as well as several stops in South Carolina, home to an early primary.

A poll by the Pew Research Center offers a snapshot of public priorities as we begin the second Bush term. Preventing new terror attacks is by far number one among Republicans, while the economy ranks similarly high among Democrats. The economy, Social Security and education rank next for Republicans, while Democrats place a high priority on expanding health insurance coverage, along with securing Medicare and education improvements.

It is worth noting that the president's high-profile calls to simplify the tax code limit lawsuit awards and make his tax cuts permanent all receive less than 50 percent among respondents from both parties. The president's Democratic rival, Senator John Kerry, continues his travels overseas. And tomorrow he's scheduled to meet with French president Jacque Chirac. It is a meeting that no doubt could not have happened during the presidential campaign given the spirited back-and-forth rhetoric over Kerry's ties to all things French.

The mainstream press is devoting a lot of attention to President Bush's second term agenda. And the same can be said about the Internet.

Web loggers, or bloggers, as they're called, are helping to stir up the debate. A little while ago I asked CNN political analyst Carlos Watson about the future of political blogs and how they appear to have taken on a life of their own.

(BEGIN VIDEOTAPE)

WATSON: They really do, Judy. I mean, they've increased in number from about 60,000 active political blogs to about 80,000. You now, according to at least one study, have north of 30 million people regularly reading them, and you're starting to see some key shifts in 2005 versus, say, 2004.

One key example being that instead of just focusing on influencing politics and campaigns, if you will, you now see them playing a role in big policy debates. So certainly on the issue of Social Security you're hearing a lot. Already on immigration there's been -- they've weighed in. And on the whole Abu Ghraib prisoner scandal, you're hearing them weigh in there as well. So at least that's one significant change versus 2004.

WOODRUFF: And I see you've discovered that they're not just focused on national politics and policies. It's local and state as well.

WATSON: Yes. I mean, you remember that the blogs really came to the fore with the presidential campaign and certainly even a little bit earlier with the Trent Lott scandal going back some two years in the U.S. Senate. But now you're beginning to see them play a role in some local mayoral races.

So look for their involvement in the race out in Los Angeles and maybe in New York, the big mayoral races. You also certainly will see them be very active in the New Jersey governor's race. Probably down in Virginia as well. So that's another interesting change for them.

One other thing. As they begin to have a bigger influence, they're no longer just trading words back and forth. But you're also starting to see a greater use of video clips or audio clips. You know, a clip perhaps of President Bush speaking, or a little streaming audio maybe of a Rush Limbaugh radio interview. So the blogs again are continuing to change and evolve pretty rapidly.

WOODRUFF: How do you measure their influence, Carlos? I mean, what -- is it just a matter of waiting to see what happens after a big news story breaks, seeing what the reaction is among the people who read the blogs and write for them?

WATSON: Well, you know, symbolically, you certainly have to look at what happened at CBS. It's in many ways as symbolic a changing of the guard or at least a shifting of the guard -- that may be more appropriate -- as we've seen. They were very involved in that National Guard story and in debunking it, to some extent. And so certainly CBS's announcement this past week in some ways says the blogs have stepped forward.

But I think you'll continue to see them not only share new information, but continue to analyze and "point out inconsistencies" in certain positions that people take. It's still a little bit wild and hairy if we're honest about it, and so some of the blogs are fairly credible, but others, you know, are shaky as any kind of day- old or month-old institution.

I would say that one of the folks who are becoming important here, Judy, are some of the blog search engines, like Technorati and Feedster, which are kind of the new Googles.

WOODRUFF: For those of us who are still new to the blog world, it helps to know what those search engines are. And finally, Carlos, what is -- what are these pod 'casts?

WATSON: Well, blogs were the thing that you learned about in 2003 and 2004, Judy. Let me be the first to tell people, some people about pod casting. In the same way that blogs allowed individuals from their homes to start sharing information via words, these pod casters now essentially are kind of amateur radio shows.

(END VIDEOTAPE)

WOODRUFF: You got that. Pod 'casts. We're going to get used to figuring out what that means.

Vice President Cheney makes a rare appearance before the cameras. Coming up, we'll tell you what he's up to.

Plus, is the inauguration too expensive? Should the millions of dollars needed to pay for festivities be spent elsewhere? We'll get the take from the left and the right ahead on INSIDE POLITICS.

(COMMERCIAL BREAK)

WOODRUFF: As we do every day at 4:00 on the East Coast when the markets get set to close on Wall Street, we are joined by Lou Dobbs in New York with "The Dobbs Report."

Hello there, Lou.

LOU DOBBS, HOST, "LOU DOBBS TONIGHT": Judy, thank you very much.

A late day sell-off right now in Wall Street as the market is closing, following an earnings warning by General Motors and a surge in oil prices today. Crude oil rising nearly $2 a barrel, selling above $48. As these final trades are being counted, the Dow Jones industrials plummeting down 114 points right. These numbers will consolidate over the next several minute. The Nasdaq is a percent lower on the day.

But Apple shares rallying after companies blow out earning's report. Apple's profit quadrupling from a year ago. And Wal-Mart is now on the offensive. The company has taken out full-page ads in more than 100 newspapers all across the country, the company defending how it treats its employees. The letter from the company's chief executive officer touts the company's diverse work force, its employee benefits and what it terms high wages. It also notes Wal-Mart plans to create more than 100,000 jobs in the United States this year. Wal- Mart has faced criticism, stemming from several lawsuits involving its labor practices.

Eli Lily is defending its Prozac drug in its own full-page ads in "The Wall Street Journal." In an open letter to patients and doctors, the company defends the safety of the anti-depression drug. A British medical journal recently printed documents from the drugmaker, allegedly linking Prozac with suicidal behavior. Lily says such results on Prozac have, in its words, "needlessly spread fear among patients." The United States may face a surge in Chinese imports. Commerce Secretary Don Evans says China's new tax on its exports is too small to protect U.S. producers from their Chinese competitors. Not much of a surprise there, really. China imposed that tariff under pressure from other nations, including the United States, as its global quotas expired at the beginning of the year and its exports began flooding world markets. Just yesterday the Commerce Department reported that the United States had posted a record $60 billion trade deficit during the month of November and our nation's largest trade deficit is, of course, is with China.

Coming up on CNN here at 6:00 p.m. Eastern on "LOU DOBBS TONIGHT," our special report, "Overmedicated Nation" tonight will investigate the increasingly close relationship between the pharmaceutical industry and members of Congress. Critics say Congress can't be trusted to put public safety ahead of large campaign contributions.

(BEGIN VIDEO CLIP)

REP. SHERROD BROWN (D), OHIO: The relationship between Congress and the industry has never been like this. We've never seen this kind of corruption. We've never seen the drug industry have the kind of influence it's had in Congress, where it always gets its way.

(END VIDEO CLIP)

DOBBS: Also tonight, there is growing resistance to President Bush's plan to give legal status to millions of illegal aliens. Tonight we take a look at the rift within the Republican party over the issue of immigration reform.

Also, we'll heading to Seattle, where a special government commission is looking into the health of our country's high technology industry. Plenty of high-tech workers warning that pre-trade with China is simply killing the technology industry in this country.

And Republican congressman is at odds with the Bush White House on at least two major issues. Congressman Mike Pence joins me tonight to explain why he opposes the new Medicare drug benefit and No Child Left Behind. We'll have all of that and a great deal more here on CNN tonight at 6:00 p.m. Eastern.

Now, back to Judy Woodruff -- Judy.

JUDY WOODRUFF, CNN ANCHOR: Thanks, Lou. Interesting to hear a member of Congress talking so openly about corruption in the influence. Thanks very much. We'll be watching at 6:00.

INSIDE POLITICS continues right now.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: The whole issue of torture has been such a blot on everything this country stands for. ANNOUNCER: New poll numbers show that Americans agree. But do you think the prisoner abuse scandal is putting our own troops in greater danger?

Is it a project out of control?

UNIDENTIFIED MALE: That has become a classic money pit.

ANNOUNCER: Or was the original price tag way too low? The Capital Visitors Center controversy is in our spotlight.

Should Laura Bush take a more active role in her husband's business? The results of our new poll may surprise you.

UNIDENTIFIED MALE: Once again, we're seeing a partisan split, even though we're asking about Laura Bush, not George Bush.

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

(END VIDEOTAPE)

WOODRUFF: Welcome back. Questions are resurfacing today about how aggressively the Bush administration has acted in protecting detainees in U.S. custody from torture. As we reported earlier, the White House is denying that it tried as recently as last month to dilute proposed rules against extreme interrogation techniques.

Our senior political analyst Bill Schneider looks at where the president and the people stand on this issue.

(BEGIN VIDEOTAPE)

WILLIAM SCHNEIDER, CNN SR. POLITICAL ANALYST (voice-over): Do Americans see any gray area on the issue of torture? President Bush does not.

SCOTT MCCLELLAN, WHITE HOUSE PRESS SECRETARY: We do not condone the use of torture period and he would never authorize torture.

SCHNEIDER: In the immediate aftermath of 9/11, however, the administration had to make some tough choices.

ALBERTO GONZALES, ATTORNEY GENERAL NOMINEE: After the attacks of 9/11, our government had fundamental decisions to make concerning how to apply treaties and U.S. law to an enemy that does not wear a uniform, owes no allegiance to any country, is not a party to any treaties, and most importantly, does not fight according to the laws of war.

SCHNEIDER: In October 2001, the CNN/"USA Today/Gallup poll asked Americans if they would allow to U.S. government to torture known terrorists who knew details about future attacks. Here was the gray area. At a time of intense fear and anger, nearly half of Americans, 45 percent, said yes. But a majority still said no. Since that terrible time, public anxiety has diminished. Moreover, people know about what happened at Abu Ghraib.

SEN. EDWARD KENNEDY (D), MASSACHUSETTS: The whole issue of torture is been such a block on everything this country stands for and what we represent.

SCHNEIDER: The public agrees. Two-thirds feel the incident has damaged the U.S. reputation around the world for protecting civil liberties. It's not just an image problem. Most Americans believe that as a result of Abu Ghraib, U.S. soldiers are now in greater danger of being tortured if they are captured. The gray area has become a little clearer. Now, nearly 60 percent say the government should not be able to torture known terrorists, even if they know details about future attacks.

(END VIDEOTAPE)

SCHNEIDER: Unlike torture, assassination of known terrorists has never been a gray area. More than three quarters of Americans accepted it in October 2001 and nearly two-thirds still do now -- Judy.

WOODRUFF: Bill, how do you explain the evolution of public opinion on this?

SCHNEIDER: Yes. Well, anxiety has diminished a bit, but interestingly, right now the endorsement of torture has very, very little to do with whether you fear additional terrorist attacks. It has a lot more to do with your basic values in politics and your basic outlook. For instance, there's a big difference between men and women.

But when we asked about all the specific torture tactics that have been reported and witnesses in Afghanistan, Iraq and Guantanamo, Americans were pretty unanimous. They rejected all of them.

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

And our polling does suggest that President Bush still has a good deal of work to do to sell Americans on his plan to partially privatize Social Security. Today Vice President Cheney took on critics of the administration's reform plan.

Let's bring in now our White House Correspondent, Dana Bash. Hi, Dana.

DANA BASH, CNN WHITE HOUSE CORRESPONDENT: Hi, Judy. And what we are seeing this week is the beginning of a massive effort by the White House to convince Americans that Social Security is a system that needs to be reformed. The president held an event on Tuesday, the Treasury Secretary John Snow went up to New York to visit Wall Street for a couple of days this week. Josh Bolten, the OMB director, is going to go to the Chamber of Commerce on Friday and, of course, today was the vice president's turn.

The White House knows, Judy, its initial task is basic, but it's really a big challenge and that is to get the attention of the American people and, of course, by extension, the attention of Congress and convince them that Social Security is going to go into the red in 2018 and that the important thing is to fix it now.

(BEGIN VIDEO CLIP)

The year 2018 may seem like a long way off and in politics, there's always a temptation to kick the can down the road, hoping that long-term problems might simply disappear or leaving them for someone else to worry about. That is not how President Bush views his job.

(END VIDEO CLIP)

BASH: Now, there are a lot of skeptical members of Congress, including those in the president's own party, who think that they could pay a political price for supporting reform, especially anything that cuts benefits. But the Bush mantra has been -- Judy, you know that he will use his political capital to push for this and push hard for it. But the White House aides understand that the president, of course, won, but it wasn't necessarily on the Social Security issue.

We have some new polling from the Pew Center that certainly backs that up. Take a look at this. Social Security, when you ask if it needs to be completely rebuilt, only 15 percent say yes. Major changes, 34 percent say yes and minor changes, only 47 percent say yes. So we don't have the graphic there, but this poll does show that the president does have a lot of work to do to convince the American people that there does need to be even minor changes in the Social Security program.

Now, political team, the communications team here, Judy, they're working on this massive effort and it's not just for the president to get out there and his top aides to travel the country, which we will see, but it's also to try employ some of the things they learned, in terms of communications, during the campaign. To use targeted media like the Internet, to use regional media and other tactics to really try to get at the American people and to try to convince them that Social Security needs to be reformed and to do it by creating private accounts for younger workers.

If you thought political ads were out with the campaign with election day, you're wrong. Of course, there are some ads coming out already on this issue. Outside groups like one you're seeing now from the Progress For America is already using ads using Franklin Roosevelt's image, something his grandson has objected to.

(BEGIN VIDEO CLIP)

AD ANNOUNCER: Washington must strengthen Social Security, no changes for those at or near retirement, but younger workers should have the option of a personal savings account. Call Congress today. Urge them to strengthen Social Security for everyone.

(END VIDEO CLIP)

BASH: And we're going to see other outside groups with other big campaign efforts like the Club For Growth. They say they're going to announce something in the next few weeks. Judy, the bottom line is the White House knows that they have major opposition and outside groups, the AARP is already saying that they are going to have a massive effort that has already started. They know that they have to have a campaign bigger even than what we saw in 2001, 2003 for the president to push his tax cut plan.

WOODRUFF: But you're right, Dana, we didn't hear nearly as much about Social Security during the campaign as we're hearing about it now. OK, Dana Bash, thank you very much.

BASH: Thank you.

WOODRUFF: With just one week and counting until inauguration day, should the Bush administration tone down the cost and the glitz of the ceremony this time around? I'll ask Bay Buchanan and Ann Lewis.

Speaking of big bucks project, we'll look at the controversial construction of a new visitor's center in Washington.

And later, she appeals to people of all political stripes. Does that change when Laura Bush talks about policy?

(COMMERCIAL BREAK)

WOODRUFF: With me now Ann Lewis, communications director for Senator Hillary Clinton's political action committee and Bay Buchanan, president of American Cause. Wonderful to see both of you. Let's start with Iraq. The elections. We're are, Bay, hearing more from the Bush administration about obstacles, challenges to expect -- people shouldn't expect things to go perfectly, are they deliberately now trying to lower expectations do you think?

BAY BUCHANAN, AMERICAN CAUSE: There's no question they are. Which is smart. All of us are hoping for this great turnout and a terrific statement, which shows that Iraq has moved a giant step forward. But we can't expect that. We should be expecting small steps. There are some trouble spots, maybe even more so than we hoped at this time, but we are going to take the step, which is the important thing.

WOODRUFF: Will that help them come election day?

ANN LEWIS, CLINTON PAC COMMUNICATIONS DIRECTOR: This is one more disappointing look back at what is wrong with our policy in Iraq. We went in there because there was weapons of mass destruction and now we hear finally after so many hundreds of millions of dollars were spent, no weapons of mass destruction. We were told, yes, but we will establish democracy in the Middle East, that's very important. Listen, I feel strongly about establishing democracy, but now we're walking back from the election and we're told it doesn't matter how many numbers participate. Time after time, what the American people were told and the reasons have been changed. Judy, I would call this moving the goal posts except we have more than 1,000 Americans who have lost their lives. It's not a game. BUCHANAN: That's not the case whatsoever. We are having elections and transferred power over there to the Iraqi people and we're having the first set of elections. It's a positive, positive step.

WOODRUFF: I want to talk about the cost of the inaugural. There are some critics who are saying, hey, this is just out of control. $40 million and up and that doesn't even count the security. That's for the parties, the parade and so forth. What is excessive and what is appropriate?

LEWIS: Well, I was thinking about this because there was two parts of an inaugural and the first part is solemn celebration of democracy. The oldest continuing democracy, yes, even in war-time, of course we inaugurate a president, that is very important. That must go on. It should go on that the appropriate level, but the second piece, the parties. The glitz. The three days of parties and the $40 million that's being donated by corporate lobbyists I think at a time when our government still pays the families of troops who are lost in battle what $12,000? That's a death benefit? To talk about $40 million, I think that's out of line.

BUCHANAN: Inaugurals are expensive, Clinton spent $33 million a number of years back. I believe this is not the proper time to have a $40 million inaugural, my personal opinion. I think we have a time we are at war, I think we've just seen the greatest natural disaster in our lifetimes for sure and if not longer. It's a time that I think the president should continue. He has a very good rapport with the American people and they feel comfortable with him and we realize these are tough times and I think don't think it is appropriate for him to be out there in this kind of regal ceremony. It should be much more down to earth in my personal opinion.

WOODRUFF: Social Security. It's a huge topic, but in just a few words, is it smart for the president to be pushing the kind of reform that we gather he is pushing right now, Ann?

LEWIS: I will say he's wrong. There is no crisis. Repeat the people who are telling us it is a crisis now are the people who were telling us there were weapons of mass destruction. George Bush wants to lower the Social Security benefits by 25 percent, that's wrong. The market goes down again today by 100 points. That's insecurity, it's a mistake. I don't think we'll do it.

BUCHANAN: I give the president credit. He's bold. He's got a second term here and he's coming out saying I have a lot of ideas that are fresh, I want to throw them on the table. Let's have a dialogue. Social Security is one of them. He's saying, look, I don't know the whole answer, but let's give the young people in this country a chance to invest themselves and maybe make more money than we were able to. Let's discuss the answers and all you hear from the Democrats is bad idea, no. But you don't hear any new ideas. Increase taxes so we can solve this problem. That's not the answer.

WOODRUFF: We have to leave it there, but I know this is something we will be coming back to. Well, is it the best solution for crowds of tourists or is it just a smaller version of the big dig. Up next, the rising costs of the Capitol Visitor's Center, overbudget and behind schedule. Right outside the front door of Congress.

(COMMERCIAL BREAK)

WOODRUFF: This story just in to CNN. The Associated Press is reporting that leaders of a Senate committee have directed the Department of Education to turn over records of its public relations contracts at the same time reminding the secretary of education of a federal ban on so-called propaganda.

Now this request comes after revelations that we've been reporting on for days, that is that the Bush administration paid Armstrong Williams, a prominent black media commentator, to promote the new education law that had been strongly supported by the president.

Also today, we want you to know that a commissioner, a member of the Federal Communications Commission is calling for an investigation into the Williams story.

Meantime, when Congress approved an underground visitor center on Capitol Hill, it seemed like the perfect solution for tourists and government workers alike. With the project now well under way, CNN congressional correspondent Joe Johns reports that the visitor's center has become a budget black hole.

(BEGIN VIDEOTAPE)

JOE JOHNS, CNN CORRESPONDENT (voice-over): Critics say the project is out of control, complaining that an underground visitor senator being built at the U.S. Capitol is well overbudget and behind schedule.

REP. JIM MORAN (D), VIRGINIA: It has become a classic money pit, it's frustrating, we can't get our arms around, we can't seem to figure out how to keep the costs under better control and the time and the budget deadlines just seem to continue to slip.

JOHNS: It will be the underground entry point for visitors to the Capitol, with better security and more space for both the tourists and the Congress, construction has been going on two years. The current budget for the project is $454 million and an analysis by the General Accounting Office last month suggested it could cost more than $558 million, twice the anticipated cost when the center was conceived. With completion now expected for the fall of 2006, it could come in up to six months behind schedule.

The man overseeing the project is Alan Hantman, the architect of the Capitol. He says changes in the design and scope of the project, especially to make it safer, upped the cost and delayed the completion.

ALAN HANTMAN, U.S. CAPITOL ARCHITECT: With the magnitude of the changes that have been imposed and sanctioned by the Congress in this project, it is impossible to have met the original schedules or to meet the original budget criteria.

JOHNS: But the accounting office analysis said low-cost estimates, indecision and incomplete designs also have affected the price tags. An expert on government contracting sees this as an example of how some federal projects run into the red due to lack of discipline.

STEVE SCHOONER, GEORGE WASHINGTON UNIV.: So if you're not really worried about maintaining budget discipline, if you're not worried about having an overrun, then what you do is you estimate low, you make promises that you may not be able to keep and you realize that later you'll be able to deal with it by simply saying, well, we hadn't worried about this contingency.

JOHNS (on camera): For some budget hawks in both parties, the price tag for the visitor's center is a real embarrassment, but there is no way out because so much has already been put into the project that scaling back now is not an option.

Joe Johns, CNN, Capitol Hill.

(END VIDEOTAPE)

WOODRUFF: Thank you, Joe.

Well, President Bush may be the star of next week's inaugural festivities, but it will also be an opportunity for Laura Bush to shine. Coming up, does the first ladies' appeal transcend politics? Not necessarily.

(COMMERCIAL BREAK)

WOODRUFF: President Bush is said to like to tell people how he "married up." And polling shows you don't have to be a fan of his to be a fan of hers. CNN's Jennifer Michael looks at the latest evidence of Mrs. Bush's appeal and whether she's bringing Americans together.

(BEGIN VIDEOTAPE)

JENNIFER MICHAEL, CNN CORRESPONDENT (voice-over): Her husband may be a politically divisive figure, but almost everyone seems to like Laura Bush. Our new poll shows 85 percent of Americans approve of the way she's handling her job.

KEATING HOLLAND, CNN POLLING DIRECTOR: It's higher than any other approval rating we've recorded for a first lady. But there's an asterisk on that. No poll asked ever asked an approval for Laura's mother-in-law, a Barbara Bush, so we don't know how many people approve of the first Mrs. Bush when she was in the White House.

MICHAEL: It's easy to make some guesses about why people find Laura Bush so appealing. She is attractive, always poised and rarely controversial, but occasionally she goes out on a limb and comments on administration policy. LAURA BUSH, FIRST LADY: Everyone supports stem cell research and so did the president.

MICHAEL: Should Mrs. Bush speak out on issues more often? Americans are split. And on this question the first lady is more politically polarizing. Most Republicans do not want her to get more involved in promoting policy. Most Democrats do. It's not just a party thing, a majority of men think Mrs. Bush should remain quiet about issues, a majority of women want her to be more outspoken. That could say something about the way men and women view politics or about the way they view women's roles. A decade's long discussion that probably will continue long after the Bushes leave the White House.

Jennifer Michael, CNN.

(END VIDEOTAPE)

WOODRUFF: And that's it for INSIDE POLITICS this Thursday. Tomorrow, a special inside look at a lesser known member of the Kennedy family, Rosemary, who died last week. I'll talk with Eunice Shriver, her sister, and Tim Shriver, her nephew, about the life of Rosemary and how her disability inspired the Special Olympics.

I'm Judy Woodruff, "CROSSFIRE" starts right now.

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