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CNN Newsnight Aaron Brown
GAO Set to Sue White House; Time Running Out for Kidnapped Journalist
Aired January 30, 2002 - 22:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
AARON BROWN, CNN ANCHOR: Thank you, Larry. Good evening again everyone. We are in the Twin Cities tonight and this is my hometown, at least a small city not too far from here is. I was asked to give a speech to the state legislature and their staff tomorrow, and rather than miss the program, we thought we'd just bring it here tonight.
So we're in the State Capitol Building in St. Paul. It is a beautiful old building and this is a true story. The last time I was here was the 6th grade. We were brought here on a field trip, and my teacher Mr. Larson, warned the class to behave. And as you might imagine, he took special care to emphasize that point with me. I listened.
We got off the bus. We walked up the big front steps single file, and all of us were waiting patiently for the tour guide to arrive, when my friend Eugene Gertismeyer and I ran screaming through the rotunda just a floor below me.
The acoustics are perfect. I love the sound of the echoes. They were really cool if you were 12. They were, however, a lot less cool if you were Mr. Larson and so he banished us to the school bus, while the rest of my classmates had their lesson in state government.
My parents, as you might imagine, were none too pleased, visions of a delinquent child, running through my mom's head. Well mom, they finally invited me back. It took a while, but they did and I promise this time, I've obeyed the "no screaming in the rotunda rule" so far.
As we do when NEWSNIGHT is on the road, we have a number of stories from here, Minnesota tonight, but they're not our top stories. The top story is still thousands of miles from here, and we begin our whip around the world in Pakistan, and developments in the case of Daniel Pearl, the missing reporter. Ben Wedeman is there. Ben, the headline from you tonight.
BEN WEDEMAN, CNN CORRESPONDENT: Yes, Aaron, the clock is ticking down on the ultimatum issued by the kidnappers of "Wall Street Journal" reporter Daniel Pearl, and we also hear an impassioned plea for his release from his wife. Aaron.
BROWN: Ben, thank you, now to Baghdad. Baghdad, of course, was one of the three countries the President named last night as part of the axis of evil. Jane Arraf, the headline from you tonight, please. JANE ARRAF, CNN CORRESPONDENT: Aaron, as you can probably see, it's a very foggy morning here and it sort of matches the atmosphere of what's going on. One of President Saddam Hussein's closest aides was prompted into a response on President Bush's comments. He summed them up as stupid. But underneath that headline, although there's not much apparent alarm, the Iraqi government has been making preparations for quite a while now to ward off an attack.
BROWN: Jane, thank you. We'll be back with you shortly. On to Washington now, a showdown between the White House and the investigative arm of Congress. This never happened before. Enron is a part of this story. Kate Snow has been working on it and Kate, a headline please.
KATE SNOW, CNN CORRESPONDENT: Aaron, the General Accounting Office is the arm of Congress that Congressional folks go to when they want answers, and right now what's never happened before is the GAO taking the White House to court.
The head of that agency today told Congressional leaders that he plans to file suit against Vice President Cheney, looking for more information about his Energy Task Force, the White House for its part in not backing down, the President of the United States saying, "bring it on."
BROWN: Kate, thank you, back to you and back with all of you in a moment. We'll admit we're heavy on Minnesota tonight, but what other broadcast would bring you to the Twin Cities in the dead of January, and there are certain things you must do when you come to the Twin Cities.
You must eat Walleye Pike and a Nutgoody candy bar, and you must talk with Governor Jesse Ventura, and we'll talk to the governor a little bit later. The Walleye Pike and the candy bar still to come in a bit.
And someone once said about St. Paul that it was another Siberia, unfit for human habitation in the winter. But the people who put on the St. Paul Winter Carnival here could have used a little more Siberia this year. Scott Harriet will have that in our Segment 7 later on.
And, last night's State of the Union speech and the events since September 11 as viewed not from New York or Washington but from the heartland, from here.
All that to come, but we begin with the kidnapping of Daniel Pearl tonight. It did get uglier today, new picture and new threats. The fact that Daniel Pearl is a reporter does not make this story more important. If he was Dan Pearl business executive, it would still matter. It mattered when it was two young missionaries held by the Taliban.
Reporters are no more important or less important. He is an American. He is a husband about to be a father, so all of us worry tonight about his safety. We have two reports. We begin with CNN's Andrea Koppel.
(BEGIN VIDEOTAPE)
ANDREA KOPPEL, CNN CORRESPONDENT (voice over): Upping the ante, Daniel Pearl's kidnapers delivered their latest ultimatum, like their last, via e-mail to news organizations. There were new pictures, and a new deadline.
"We have interrogated Mr. D. Pearl and we have come to the conclusion that he is not working for the CIA" the kidnappers wrote. "In fact, he is working for the Israeli Intelligence Service Mossaad. Therefore, we will execute him within 24 hours unless America fulfills our demands."
PAUL STEIGER, MANAGING EDITOR, THE "WALL STREET JOURNAL": Danny Pearl is a journalist, simply, pure and simply.
KOPPEL: Pearl's employer, the "Wall Street Journal," made another appeal for his release, sending out its own e-mail message and taking to the airwaves.
STEIGER: He doesn't have the power to bring about the demands of the people who have him captive.
KOPPEL: What do the kidnappers want? The release of Pakistani prisoners in Guantanamo, Cuba, the repatriation of the Taliban Ambassador to Pakistan, and payment for F-16 fighter jets ordered by Pakistan. But both U.S. and Pakistani officials say the F-16 matter was resolved years ago.
In Pakistan, the FBI has taken the lead in the manhunt, and while investigators now believe Pearl's kidnappers had orchestrated an elaborate trap, they still know precious little about who or where they are.
RICHARD BOUCHER, STATE DEPARTMENT SPOKESMAN: We're very concerned about his safety, and we hope that he can be located and freed soon.
(END VIDEOTAPE)
KOPPEL (on camera): Pearl's kidnappers have also put other American journalists in Pakistan on notice, telling them they have three days to leave the country or they'll become targets too.
Playing it safe, late Wednesday, the State Department advised all American citizens to think twice before traveling to Pakistan. Andrea Koppel, CNN, at the State Department.
BROWN: Like her husband, Daniel Pearl's wife knew the risks. She is also a reporter. She is her husband's partner. She's about to become a mom, and as we found out today when she sat down with Ben Wedeman, she is a remarkably strong woman. So back to Karachi, Pakistan, and Ben. Ben, good evening.
WEDEMAN: Yes, Aaron, as you mentioned she is incredibly strong. We spoke with Marianne Pearl. She's the wife of Daniel Pearl, and she was quite calm, quite steady in telling us what she wants. Obviously, she wants her husband released, and explaining to us what they're doing here and what they're doing here is, as journalists, they're trying to foster dialog and understanding between this part of the world and the west. And I asked her how she is coping with this ordeal.
(BEGIN VIDEOTAPE)
MARIANNE PEARL, WIFE OF DANIEL PEARL: I haven't slept for six days sine you're asking, but I have hope. I mean, you know I'm not desperate because if I stop believing in creating this dialog, then I stop believing in everything else, so I can't do that. I'm pregnant.
WEDEMAN: And if you could speak to your husband now, what would you tell him?
PEARL: I love you.
(END VIDEOTAPE)
WEDEMAN: OK. At the moment, the Pakistani authorities are focusing their investigation on a group called Jamat in (inaudible). That is a hardline Muslim group and they have taken into custody its leader, Mubarek Ali Al Jilani, who in fact was the man Mr. Pearl was going to interview the day he was kidnapped.
Now Mr. Pearl was investigating links between Richard Reid, the so-called shoe bomber, who was taken into custody in the United States, the links between Mr. Reid and Mr. Jilani.
Now Mr. Jilani, in fact, voluntarily gave himself up to the Pakistani authorities and they are describing him as "the prime suspect" in this case. Aaron.
BROWN: Ben, two things quickly; one, is there any visible sign that you see a progress in the investigation, other than taking the one man into custody? And the second question is, how is this being played in the Pakistani media?
WEDEMAN: Well as far as the actual investigation itself, everyone concerned is very tight-lipped about it. It's obviously a very sensitive topic, and they don't want to make the details of that investigation public. We know that American investigators, as well as Pakistanis, are vigorously involved in that investigation.
As far as the way it's being played in the local press, basically it's being played straight down the line, simply the facts. Really most people here obviously have very little sympathy with the kidnappers and with their ideology.
And certainly, many Pakistanis took heart from the fact that only very recently, the United States lifted its travel advisory on Pakistan, and now of course, that travel advisory is back in place. So very much a dismay here over this story, and a general desire to see Mr. Pearl released. Aaron. BROWN: Ben, thank you. Ben Wedeman in Karachi, Pakistan today for us. If President Bush didn't mention Daniel Pearl specifically by name last night, he certainly made it plain there would be no mercy shown to kidnappers, to killers, or to the nations that sponsor terrorists.
But in naming three of those nations, by calling them the axis of evil, the President did more than just write the headline for morning papers today. He's gotten everybody talking again about what comes next in the War on Terror. Here's CNN's David Ensor.
(BEGIN VIDEOTAPE)
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: All nations should know, America will do what is necessary.
DAVID ENSOR, CNN CORRESPONDENT (voice over): It was a war President, sounding like he may widen the war to cover Iraq or Iran or North Korea, calling them an axis of evil.
BUSH: I will not stand by as peril draws closer and closer. The United States of America will not permit the world's most dangerous regimes to threaten us with the world's most destructive weapons.
ENSOR: Certainly opponents of Iraqi leader, Saddam Hussein took heart from the speech, and from talks at the State Department about more U.S. aid for them.
SHARIF ALI BIN AL HUSSEIN, IRAQI NATIONAL CONGRESS: We feel that things are going our way.
ENSOR: Conservative advocates of taking the war to Iraq, also liked the President's approach in the speech.
CHARLES KRAUTHAMMER, SYNDICATED COLUMNIST, THE WASHINGTON POST: I think that between this State of the Union and next year's State of the Union, we will have a war in Iraq.
ENSOR: But asked whether the President really meant to suggest war with Iraq is likely, administration officials left it ambiguous.
DONALD RUMSFELD, DEFENSE SECRETARY: He didn't suggest anything. If there was anything about last night's speech, it was that it had near perfect clarity.
ENSOR: As for Iran and North Korea, some analysts were surprised the President put them in the same category as Iraq, after all Iran has even helped at least some on Afghanistan, and for some time now, North Korea has been offering talks and keeping its head down.
IVO DAALDER BROOKINGS INSTITUTE: He's really closed down the road to diplomacy, to engagement, to a carrot as well as a stick approach, and it's now all sticks, no carrots. You do as I tell and otherwise, we will make you.
(END VIDEOTAPE) ENSOR (on camera): While the President's language suggested to some that he's contemplating a war against Iraq, one senior administration official warned against reading too much into his words. The United States is not going to have a one-size-fits-all policy, the official said, so don't assume the President plans to repeat Afghanistan all around the world. David Ensor, CNN, Washington.
BROWN: It's a fine line the administration appears to be walking. On the one hand, putting Iraq on notice, but on the other hand not letting Iraq know what the President intends to do. And compared to his father, this President Bush may find himself in a somewhat more difficult position. Here there is no Kuwait invasion to drive an international coalition together, and so far at least, there is no link to the 11th of September.
This is a policy still evolving in Washington, but the response and the tone are as you would expect in Baghdad. So once again, here's CNN's Jane Arraf.
(BEGIN VIDEOTAPE)
ARRAF (voice over): This reaction from an Iraqi leader was as pointed as the U.S. warning.
TAHA YASSIM RAMADAN, IRAQI VICE PRESIDENT (through interpreter): The statement of President Bush is stupid and does not befit the President of a major country.
ARRAF: The Vice President earlier told a legal conference that President Bush was falsely accusing Iraq of having weapons of mass destruction.
BUSH: This is a regime that agreed to international inspections, then kicked out the inspectors.
ARRAF: In fact, as Iraq points out, it didn't kick out the inspectors. The Chief U.N. Weapons Inspector pulled them out in December, 1998, just hours before the U.S. and Britain bombed Baghdad.
There was no official reaction though to President Bush's comments, and no comment from the only one who really matters, President Saddam Hussein. Instead, the President appeared on the main evening news, discussing plans for a new monument in Baghdad.
(END VIDEOTAPE)
ARRAF (on camera): Iraqi officials seem to be taking the latest U.S. threat in stride, but behind the scenes, there are signs that Baghdad is taking seriously the possibility of a major U.S. attack.
(BEGIN VIDEOTAPE)
ARRAF (voice over): In the last month, the Iraqi leadership has taken some dramatic steps, which appear aimed at warding off a strike. Regarding the weapons inspectors, it sent a message through Arab League Chief Emir Amusa (ph) that Baghdad would like to reopen a dialog with the U.N.
Diplomats say those talks could eventually lead to the inspectors' return. And it's improving ties with old foes. Iraq's Foreign Minister flew to Iran this week for only the second visit in a decade, to discuss normalizing relations.
With President Bush listing Iran as another of the countries to be dealt with in the U.S. War on Terror, Iran and Iraq, two traditional enemies now have something else in common.
(END VIDEOTAPE)
ARRAF (on camera): As Baghdad wakes up this morning, the only thing a lot of Iraqis can be certain of is that their fate rests in the hands of two men, both of whom portray themselves in a battle of good against evil. Aaron.
BROWN: Jane, I'm curious about something you said, that the Iraqis had made overtures to the U.N. to perhaps start the inspection process again. Is it your guess that the President's assertions last night in his speech make it more difficult for the Iraqis to follow through with the inspections, or less difficult? Do they feel a gun is at their head?
ARRAF: His comments probably in Iraqi terms make it slightly less difficult, i.e. perhaps make it easier to come to that compromise. For one thing, it takes them further down that road. There's now maybe a little bit more urgency for them to be, not just reaching out to the U.N., but actually taking concrete steps to engage in what the U.N. would call a productive dialog.
The other point of that is, President Bush's use of the word "evil" and the whole approach, which does not resonate very well, not just in Iraq, but in the Middle East in general, and that always serves to shore up support for Iraq, which has been trying very hard to make its allies and its neighbors believe that this is actually war of the United States against the Arabs and the Muslims. Aaron.
BROWN: Jane, thank you. Jane Arraf in Baghdad, early in the morning there. We're fortunate that our next guest knows Iraq and she knows Iran and Islam and germs, and nukes. It's quite a portfolio.
We sat with her until 1:00 in the morning last night, talking about some of this and we'll do it again tonight, only this time without the wine. Judith Miller joins us from New York. She is, among other things, an author and senior writer for the New York Times. Nice to see you again, from a distance this time.
JUDITH MILLER, "NEW YORK TIMES": Good to see you and glad to see you made it home.
BROWN: Thank you. Judy, any doubt in your mind that Iraq continues to develop the most destructive kinds of weapons, these weapons of mass destruction?
MILLER: I don't think there's any doubt in anyone's mind that Saddam Hussein has not changed his objectives and his goals, and that his desire for biological, chemical, and nuclear weapons are just as strong today as they were when he initiated his program way back before the Gulf War.
BROWN: And these weapons that the Iraqis and Saddam are developing would be used on whom?
MILLER: Well he has really distinguished himself in the region, in that he has shown that he is willing to use these weapons even against his own people. He used chemical weapons in Halaja (ph) against his own people. He has demonstrated time and time again that he will stop at nothing to achieve his goals, and I think, of course, he has threatened to use them against Israel.
The question is what will Saddam Hussein do when and if he is cornered? He did not use the weapons the last time during the Gulf War, I think because he was afraid of what the United States would do to him.
So now, the issue is if he feels that this is the last gasp and that his regime and he are going down, will he use these weapons that the U.N. and the special commission that has been monitoring or trying to monitor these activities says he has and has hidden? Will he use them and no one really knows that.
BROWN: And the Iranians, what sort of trouble are they in this? The same sort of weapons in development there? Different?
MILLER: Well, I think that, you know, Iran too is said to be seeking nuclear, biological, and chemical capability. But the evidence is a lot less clear in the case of Iran. And as you know, Aaron, there is a rather fierce power struggle within the Iranian government over which direction Iran will take. And, I don't know the effect that the President's remarks will have on that internal power struggle, and if it will have any impact at all. It probably will.
BROWN: I want to - Judy, I want to go back to Iraq because I guess I'm a little bit stuck on this question of, when you put a gun to the leader of another country's head, how they react, and I'm wondering if you think that Saddam might feel that he's losing face now if he cedes to the U.N. weapons inspectors?
MILLER: You know, I think that's no longer an issue, what he feels. The difference between the previous administration and this administration, at least in terms of the President's speech last night is that President Bush has made it absolutely clear that he intends that the U.N. resolution, which required Iraq, which Iraq agreed to, to submit to international inspection be carried out.
And I don't think that the world can say that that isn't an important resolution when everyone agreed at the time, after the Gulf War, that it was. And clearly, some people believe that the hawks in Mr. Bush's administration are trying to use this to kind of develop a (inaudible) and it will give the United States an opportunity to use military force against Iraq. And that, in fact, the administration would be very disappointed if Saddam Hussein changed his mind and said, "oh yes, welcome, come back into my country" because the new inspection rules and the new inspector monitoring regimes are much weaker than the old regime, which really produced a lot of information about Iraq's weapons of mass destruction.
BROWN: Judy, thank you. Judith Miller in New York with us, the New York Times. Thanks for joining us. Good to see you.
MILLER: Good to see you.
BROWN: On television tonight. Thank you.
MILLER: Good.
BROWN: Still to come from us this evening, the Vice President gets an unusual birthday surprise. He's sued. We'll explain in a moment. This is NEWSNIGHT from St. Paul, Minnesota.
(COMMERCIAL BREAK)
BROWN: Now Enron, the Vice President and the lawsuit. In some ways, we are looking at something without precedent here, an arm of Congress possibly suing the Executive Branch of government.
At the same time, the principles in this story go back to the Founding Fathers, and so does one of the other factors that play, which is of course, politics.
So whatever else happens, there is a possibility at least that all of our grandchildren and their grandchildren will read about this one in civics classes to come. We, of course, will have to settle for the first rough draft of history tonight from CNN's Kate Snow.
(BEGIN VIDEOTAPE)
SNOW (voice over): It probably wasn't what Vice President Cheney wished for on his 61st birthday. The head of the General Accounting Office, the investigative arm of Congress, told Congressional leaders he would file suit against the Vice President.
In a letter to lawmakers, David Walker cited the collapse of Enron as one reason Congress needs more information about Cheney's Energy Task Force. "All of our attempts to reach a reasoned and reasonable accommodation, including reducing the scope of our request, have been rebuffed" Walker wrote. "The Congress has a right to the information we are seeking."
It's the latest ratcheting up in an investigation initiated by Democrats nearly a year ago.
REPRESENTATIVE HENRY WAXMAN (D) CALIFORNIA: I can't understand why the Vice President has stonewalled this request.
SNOW: Walker says he scaled back Congressman Waxman's original request. He told CNN, "we're not after notes, not after minutes of meetings held by Cheney's task force. They just want the basics" he said "who did Mr. Cheney meet with, when, where and at what cost to taxpayers."
Legally, the lawsuit would be a first. The GAO has never sued a Federal official and courts have been reluctant to get in the middle.
STAN BRAND, FORMER COUNSEL TO HOUSE OF REPRESENTATIVES: The courts have been reluctant to enter into the fray, and referee a fight between a President and the Congress.
SNOW: It's unclear what a courtroom fight would come down to, but one central question, whether the GAO even has the power to ask for the information it's seeking.
MARK TUSHNET, GEORGETOWN UNIVERSITY: The GAO is authorized by statute to investigate various things in the Executive Branch. The issue here is whether the Vice President's Energy Task Force comes under this statutory authorization.
SNOW: The administration says it does not and argues the search for information is being driven by Democrats politically motivated. What's more, White House aides insist it would be absurd to ask an administration to make public every detail of every closed door meeting held to discuss policy.
ARI FLEISCHER, WHITE HOUSE PRESS SECRETARY: The President will stand strong on principle, fighting for his right and the right of all future Presidents to receive advice without it being turned into a virtual news release.
(END VIDEOTAPE)
SNOW (on camera): Legal experts don't agree on who has the upper hand if this goes to court, but they do agree on one thing and that is, that everyone has a lot at stake here. And so, it's quite possible that they might settle this short of court, perhaps even a political settlement.
David Walker told me today that he plans to give the administration another two or three weeks before he actually files suit, Aaron, hoping that perhaps in his word, the White House will find a way to come to a reasonable accommodation. Aaron.
BROWN: Kate, thank you. Kate Snow on the Hill tonight. Let's go to the other end of Pennsylvania Avenue and the White House view of all this. Just why is the White House choosing to make its stand on this, given the news background of Enron and the rest? At the White House for us tonight, CNN's Kelly Wallace. Kelly, good evening to you.
KELLY WALLACE, CNN WHITE HOUSE CORRESPONDENT: Good evening to you, Aaron. Well the reason why? The White House says this is all about principles, about protecting the power of this President and future Presidents, the ability to get unvarnished advice and not release that to the public. Now White House aides were putting a very confident and defiant face forward today, echoing words that President Bush apparently uttered yesterday, a senior administration official saying, the President when talking about a possible lawsuit said "bring it on."
That being said though, Aaron, Bush advisers certainly would have preferred the news of the day to be this, the President's trip to North Carolina to talk about his State of the Union address, and the creation of a new program, the Citizen's Corps to boost volunteerism in the country.
Instead though, advisers were fielding questions about the GAO's intent to sue the White House for the very first time. Along the way though, aides were firing off some salvos of their own, charging that politics is at work here.
MARY MATALIN, ASSISTANT TO PRESIDENT BUSH: We feel like it's the basis of this suit, because the suit was all put to bed. They had, they could have sued us in August. We were ready to go in August. We told them "let's go" in August. We're ready to do this and they just dropped it. So it was the reemergence of a political issue for the Democrats, Enron, which re-raises this unrelated Constitutional principle. So yes, we do feel that it's politically motivated.
WALLACE: Now as for Mr. Bush, he finished up his day in Florida. He did not address this matter. But earlier this week, his Vice President, Dick Cheney, in an interview with my colleague John King, said that Enron and its executives among the largest campaign contributors to President Bush, did not have any undue influence over the administration's energy plan.
The White House though did confirm today that the Vice President, when he met once last year with Enron's former Chairman Ken Lay, that Mr. Lay did present a policy memo to the Vice President when they were discussing energy policy.
But the White House, the Vice President and his aides saying today that Enron got no special treatment, that some things in the energy plan Enron liked and some things it didn't. Democrats, though, as you've heard in that previous report, are not satisfied.
And, Aaron, the big question then becomes, will the administrations' fight to keep this information secret and the Democrats fight to make it public, will either side face any political damage? That's the big question. Aaron, back to you.
BROWN: We'll wait another day for an answer. Kelly, thank you. Kelly Wallace on duty tonight here at the White House.
A quick note here before we go to break. We are getting late word that former attorney general Janet Reno has taken ill. She collapsed a short time ago while speaking at a news conference in Rochester, New York. She has been taken to the hospital. We do not yet know of her condition, whether it is related to her ongoing battle with Parkinson's disease or not. Again, as many of you I think are aware, former attorney general Miss Reno is running for governor in the state of Florida. Her collapse tonight was in Rochester, New York.
Coming up next, the fiscal crunch in the Golden Gopher state. A couple of segments coming up on the economy and the governor when we come back.
(COMMERCIAL BREAK)
BROWN: A Minnesota story here, although it could be New Jersey or Texas or Florida. As the country found itself in a recession, it is not just the federal budget that is out of balance. States that were flush with cash a year ago are today looking at cuts and tax increases. Indeed, as you will hear in a moment when we talk with the governor, the states, in many ways, have it much tougher than the federal government.
And so as the legislature begins its session here in St. Paul, it finds the surplus is gone and the choices are no longer easy.
(BEGIN VIDEOTAPE)
(voice-over): It's the start of another day for Brendan Nissen's (ph) fifth-grade class at Concord Elementary School in suburban Minneapolis.
UNIDENTIFIED BOY: It took one small step at me than made a (UNINTELLIGIBLE).
BROWN: Twenty-four students here, just about the maximum school administrators believe a teacher can handle and still provide a quality education. But soon, things are likely to change at Concord and at schools all across the state of Minnesota. Those changes will not be for the better.
KENNETH DRAGSETH, SUPERINTENDENT, EDINA, MINNESOTA SCHOOL DISTRICT: The burden of a lot of this financial situation in the state of Minnesota we feel is falling on the students and the families of Minnesota and we don't think that's right.
BROWN: Like his colleagues across the state, Edina school superintendent Ken Dragseth is wrestling with a reality of a state- wide budget that is suddenly $2 billion in the red.
What that means to him is more kids per classroom and fewer teachers to teach them. Only a year after Governor Jesse Ventura and the state legislature had promised a surplus of just about the same number.
DRAGSETH: You know, you can say, well, blame the governor or blame the legislature. But I think it's a combination. I think that obviously they didn't expect the economy to take such a turn and 9/11 obviously had some effect on that. But everybody kind of jumped on the bandwagon for tax cuts and we as, you know, schools, we were saying, now be careful here.
BROWN: But they weren't careful in Minnesota and in many other states as well, at least not in the eyes of people who run schools. Because of a flush economy prior to September 11, Minnesota changed the way it funds schools. It abandoned the traditional property tax, placing all school revenues in the hands of sales and income taxes. The timing, it turns out, could not have been worse.
JIM RAGSDALE, "ST. PAUL PIONEER-PRESS": The cornerstone of Governor Ventura and the Republican tax reform plan of this current -- the 2001 session was to use, as you said, use more state revenue to pay for local schools. And again, it's something that looks a lot better in good times than it does in bad times.
BROWN: Jim Ragsdale spent years covering Minnesota politics for the "St. Paul Pioneer-Press".
RAGSDALE: The state lost a lot of good jobs, income went down and the projections on which a lot of the budgets were crafted suddenly meant nothing anymore. And everybody is dealing with projected deficits instead of projected surpluses.
BROWN: Scenarios like this, of course, are playing out all over the country as a new year gets under way. State by state, it's hard to find anywhere that is immune to the twin disasters of both a physical hurricane and a financial one. So why is Minnesota especially hard hit?
SUNG WON SOHN, CHIEF ECONOMIST, WELLS FARGO BANKS: If you look at the jobless rate in Minnesota, we have gone up faster than the U.S. average. So in that sense, we have suffered more than the U.S. average.
BROWN: Economists say because Minnesota produces so much and depends on high-tech jobs to create wealth, that when the bad times hit, and they have hit, this state gets hit hard.
SOHN: Revenue sources for the state tend to go up faster than the U.S. and tends to fall faster than the U.S. So we need to really fix our tax structure so that we can stabilize the revenue sources.
(END VIDEOTAPE)
BROWN (on camera): The economic picture, and in a moment, Minnesota's Governor Jesse Ventura as NEWSNIGHT continues from the state capitol in St. Paul, Minnesota.
(COMMERCIAL BREAK)
BROWN: So much has been written and said about Jesse Ventura that we won't waste a lot of your time introducing him tonight. Surely, you know he used to be a pro wrestler, "The Body" and all of that. But for Minnesotans, the novelty is very much old news. Jesse Ventura has been governor three years now, and as you saw just a few minutes ago, he has got plenty of problems on his plate tonight.
We spoke with the governor late this afternoon.
(BEGIN VIDEOTAPE)
The state's economy is vastly different today than it was when you took office, and even a year ago.
GOV. JESSE VENTURA, (I) MINNESOTA: Yes.
BROWN: Are you going to ask for a tax increase?
VENTURA: We are going to -- I looked at balancing the budget structurally four years out, which is way it should be done, and in doing that, it's very difficult to put almost $2 billion just simply into tax cuts. So there will be tax increases, but they're targeted in only consumption taxes, which is something that I believe strongly in. I'm a great believer in sales taxes. I'm an advocate for the national sales tax, and to abolish the income tax.
So any increases that I do decide to favor will be consumption type taxes, where you pay as you go on what you consume.
BROWN: But a lot of things that you consume, you don't have many options. You need gas for your car or...
VENTURA: Oh, but you have options. I mean, you can buy a car that gets better mileage, you can drive less. You know, you still have options, even though you are buying a consumer tax. And one thing is raising the price on tobacco -- and that's a simple one, quit smoking, and you don't have deal with it at all.
BROWN: And that's an easy tax?
VENTURA: No, that's not an easy one, because you feel raising any tax I don't think is easy. Because in fact, it hits me, I'm a cigar smoker, and I include in it cigars and smokeless tobacco also. You know, it's a matter of everyone what I'm trying to instill in the public in Minnesota is that we are at war, and a war, as well as the recession, both play a great deal in our current economic situation.
Well, at a time of war, everybody is going to feel a little pain. And so, what I'm trying to do is spread the pain out, as lightly as I can, to encompass as many people as I can, rather than focusing on just certain areas.
BROWN: What the president said yesterday and what the president said before is that in times like this it's the worst time to raise taxes. The worst thing you can do in time of a recession is to raise taxes.
VENTURA: Well, he may -- I don't know. I have no idea if it's better or worse. I just have do what I have to do. You have to remember something; the president is given great leeway. He can deficit spend. We at states can't do that. Put him under my rules and see what he can do. You know? Make it so that the United States government can't have a deficit. We can't have one at state government, so that's apples and oranges, and I don't think it's a fair question to ask under both the elements that we work under. He can deficit spend, I cannot.
BROWN: Are you going to run again?
VENTURA: I don't know. I'll decide after the session is over.
BROWN: What will be -- what will you use to determine whether you'll run again?
VENTURA: I will not run just to be the governor. Something will have to be there of unfinished business, something I want to accomplish, something to motivate me to run again. I'm not going to just run to be governor for four years and spin my wheels and feel big and powerful and all of that stuff. No, I will move on before I do that, because -- so if something is there that I want to accomplish, that would be the most driving factor.
BROWN: Would you agree that people who have been governor during the time you have been governor, people who have been mayor during these times up until very recently have had it easy in this way: There has been money. The economy has been good, people have been working. It's much tougher now. You don't agree with that?
VENTURA: No, I don't.
BROWN: Really?
VENTURA: Yeah. Because I've learned through times of surplus, it doesn't change anything. Then you have every special interest group in the world here fighting to get the money, and the fights are even worse and more vicious.
I find that in a time of deficit, you can also incorporate much more reform into government, because people won't reform the way they do things if they are fat, sassy and happy, with plenty of money. But when there's not the money there, then people will look at doing it a different way. And I find that very challenging, the ability to reform government and change the way it does its business.
So if you had been here during my three sessions of surplus, you'd have seen some of most bitter fighting you ever saw. An example: Last year, we had a huge surplus. The deficit hadn't set in yet. They couldn't finish their work on time. I had to call a special session, and they took me to three hours of shutting down the government. Now, why would that happen with all this money and this surplus? And I bet you we won't have a special session this year with a deficit. So it was worse last year than it is this year.
BROWN: Last question: Any regrets?
VENTURA: Never! I don't live life with regrets. You can't go into this life and regret things you have done, because you can't relive them over again. I don't do that. I don't regret anything. I'm who I am, and what I did yesterday I can't change for what -- from yesterday I can't change it, so you move ahead. I'm a person that thinks ahead and moves forward.
BROWN: Nice to see you, sir.
VENTURA: Thank you, Aaron.
BROWN: We appreciate your time very much.
VENTURA: My pleasure.
(END VIDEOTAPE)
BROWN: The governor, Jesse Ventura. He's not the only Minnesotan with things on his mind. We'll hear from others in just a moment. This is NEWSNIGHT, from the Twin Cities.
(COMMERCIAL BREAK)
BROWN: Well, an awful lot has happened in the country and in the state since we left here a long time ago. We wanted to talk a little bit about how the events of the last few months have played out in the middle of country, here in Minnesota. Katherine Lanpher does a talk show on Minnesota Public Radio. And we thought we'd chat a bit.
I'm curious about a lot of things. Minnesota politics traditionally has been kind of mildly progressive. Fair description?
KATHERINE LANPHER, MINNESOTA PUBLIC RADIO HOST: That's how it's perceived nationally, yes.
BROWN: How did the president's speech play on the program today?
LANPHER: I was just going to say, we did an hour of that today. And I think what you heard actually from most of the callers was a consensus that in his stance as a wartime leader, the president is doing OK, but people were very, very nervous about the fact that he named, as you referenced earlier in the show, "the axis of evil," those three countries. They didn't like him naming names. They thought maybe he was moving too fast.
BROWN: This was a Gore state?
LANPHER: That's right.
BROWN: Right.
LANPHER: Although I have to point out, we have a Republican- controlled House in our legislature. We have, of course, an independent as governor -- boy, is he independent.
BROWN: Yeah.
LANPHER: You know, I don't know if you can go anymore by the old stand-by that this is definitely a progressive Democratic state. It's a lot more diverse than the last time you were here.
BROWN: It is remarkably more diverse than the last time I was here. And that's part of the -- it is part of the challenge for educators. For example, it's more expensive when you have Somalis in schools as they do here now, people from Southeast Asia. It's a more expensive business to educated children.
LANPHER: We literally have between 60 and 80 languages in the two urban school districts.
BROWN: Any -- honestly, it used to be that it was just Swedes and Norwegians.
LANPHER: Oh, don't go into that battle.
(LAUGHTER)
BROWN: Right. It's not that way anymore. Are they happy with -- are they happy with the ability for the president to handle the economy, do they believe in the president's ability to handle the economy?
LANPHER: I think, you know, first of all -- and again, you're referenced this earlier -- we have a $2 billion projected deficit in our state budget, so we are very used now to looking at red ink. So when the president says permanent tax cuts, let's have the highest defense budget in twenty years and by the way, we are going to double the peace corps, people were scratching their heads, working the calculators at home and saying how does this add up?
BROWN: Different subject: Do you think people here are still in shock from the 11 of September? Those of us who live in New York or in Washington and experienced it in a somewhat different way and see it literally every day, how about here?
LANPHER: I don't know if the shock registers on day-to-day basis the way it would with a physical scar like you have in the skyline, but we all, as I suspect, every American state does, we all have our connection to that story. Of course the so-called 20th hijacker tried to train here for his flight education. We have other connections, and people also -- we had droves of volunteers who went out to New York to help.
BROWN: Someone said to me the other day that they thought the state was not so much in shock but that it was carrying still a very heavy heart.
LANPHER: I think that is true. I you flew over the holidays and it was interesting to see the gentle way that people stood in line. With each new disruption there was almost a sort of, OK, stoic, this is what we have to do, this is what we will do.
BROWN: Minnesota nice.
LANPHER: Minnesota stoic.
BROWN: Thank you. Nice to meet you. We will be right back.
(COMMERCIAL BREAK)
BROWN: There aren't a the lot of places in country where jokes about cold could be a genre all to themselves. Minnesota, the exception. Minnesota closed for glacier repairs, Minnesota where visitors turn blue with envy. These are the jokes I grew up with. Here is the big joke this year: it hasn't been all that cold, at least not the kind of deep freeze hard-core Minnesotans are used to, which has been a problem this year as you will hear from Scott Harriet.
(BEGIN VIDEOTAPE)
SCOTT HERRIOTT, CNN CORRESPONDENT (voice-over): St. Paul, Minnesota is home to the oldest and largest winter celebration in the U.S.
We went to check out the local culture and while there we learned a lot about ice. Apparently it melts when temperatures rise above freezing.
(on camera): For some reason it seems to be frozen.
UNIDENTIFIED MALE: It could be the weather.
UNIDENTIFIED MALE: When the sun hits the ice.
HERRIOTT: All hell breaks lose.
(voice-over): Bob Viking -- yes, Bob Viking -- the president of the St. Paul festival and heritage foundation took us on a tour of what just a few days earlier had been a glorious display of high-brow ice art.
(on camera): These are trees. That is some kind of Gumby expose.
BOB VIKING, PRESIDENT, HERITAGE FOUNDATION: No, they kind of look like gumbies now, but I think originally they were trees.
HERRIOTT: And what is that on top of this one? Is that a gnome or an elf?
VIKING: You know, I'm not really sure, it looks like maybe at one time it was a gnome, but I'm afraid the gnome has melted.
It's a disservice to the artist when the ice carving begins to melt so badly that it's no longer recognizable at all.
HERRIOTT: Yes and it ends up looking like a stalk of celery or something and it was supposed to be a swan.
VIKING: Right.
HERRIOTT (voice-over): It's been an unseasonably warm winter in Minnesota.
VIKING: Warming up are you?
HERRIOTT: The sculptures that started to melt had to be taken out of their misery before they hurt any humans, or each other.
(on camera): What do you yell when it falls? Glacier?
VIKING: Oh no, not really, it doesn't fall that fast. We use bobcats. HERRIOTT: Really? Live bobcats?
VIKING: No, mechanical bobcats.
VIKING (voice-over): Though the heat wave has caused cancellations of some of the festivities, it certainly hasn't crushed the spirit of the warm blooded people of Minnesota.
(on camera): Now if I just stood here, how long do you think before I would die.
VIKING: Oh, I think you'd be rescued long before you'd die.
HERRIOTT: That's the people of St. Paul for you.
What do you think of the snow sculptures?
UNIDENTIFIED MALE: Man, oh, they're wonderful!
HERRIOTT (voice-over): Those that live in the Twin Cities are clever and they are proud of their carnival, such as it is.
UNIDENTIFIED FEMALE: It looks like an ex-boyfriend of mine, actually.
HERRIOTT: Even the governor of the Gopher state is into it.
(on camera): Is Jesse coming out to the festival?
UNIDENTIFIED FEMALE: I don't know, I haven't looked for him.
HERRIOTT: Does he still wrestle?
(voice-over): The biggest attraction at this year's carnival is the giant snow slide, built and supervised by seasoned army reservists.
(on camera): What do you advise?
UNIDENTIFIED MALE: Stay on the sled.
That and keep your hands inside.
HERRIOTT (voice-over): Having received the official instructions from the U.S. government, I decided that when in Minnesota it's probably best to do what Minnesotans do.
(on camera): I'm going to die.
UNIDENTIFIED MALE: That was Scott Herriott, from CNN.
(END VIDEOTAPE)
BROWN: Nice to be home and assuming I don't get caught running through the rotunda again, we will be back here tomorrow. Good night for all of us at NEWSNIGHT.
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