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Inside Politics

How Secure Are Olympic Games?; Former Enron Chief Pleads Fifth

Aired February 12, 2002 - 16:00   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.
JUDY WOODRUFF, CNN ANCHOR: I'm Judy Woodruff in Washington. Amid a new terrorism alert from the FBI, I'll ask Olympics organizer, Mitt Romney, if the Salt Lake City Games are secure enough.

JONATHAN KARL, CNN CONGRESSIONAL CORRESPONDENT: I'm Jonathan Karl on Capitol Hill, where senators lambasted Ken Lay, and the former Enron chief remains mostly silent.

KATE SNOW, CNN CONGRESSIONAL CORRESPONDENT: I'm Kate Snow, also on the Hill, where campaign finance reform is set to hit the House floor tomorrow. Fence-sitters the subject of a massive lobbying campaign.

WOODRUFF: Also ahead, an up-close look at the strategizing and head-counting, as we tag along with a key figure in the campaign finance reform debate.

Thanks for joining us. We begin with an update on kidnapped American journalist, Daniel Pearl. Pakistani police have indicated "The Wall Street Journal" reporter's release could be secured in the coming hours. This, after a British-born Pakistani militant believed responsible for Pearl's abduction was arrested earlier today. He told investigators that Pearl is alive and still in Karachi.

All this is happening as Pakistani President Pervez Musharraf is here in Washington. Right now he is speaking at an international forum. The White House says Pakistani officials have been very helpful in trying to find Pearl and secure his release. "The Wall Street Journal's" managing editor, Paul Steiger, tells CNN that he now is waiting for further word from Pakistan on Pearl's fate.

We are joined now by Ann Cooper. She is executive director of the Committee to Protect Journalists. Ann Cooper, do you believe these reports that Danny Pearl is still alive?

ANN COOPER, CMTE. FOR THE PROTECTION OF JOURNALISTS: Judy, I approach these reports with great caution. This is the third week of this terribly emotional ordeal. We've already gone through a couple of days sometime back of hearing reports that Danny actually had been killed. I'm very hopeful about these reports, but I think we should all remain cautious until we know with certainty what the situation is.

WOODRUFF: What is your understanding of the process under way right now in Pakistan, between the police, authorities there, and the people believed to be responsible?

COOPER: Well, I don't have any great inside information about how this is proceeding. I know that U.S. authorities, who have been monitoring this very closely, believe that the Pakistanis have pursued this very vigorously. They said that the Pakistanis have taken a very positive approach to this. And that seems to have been rewarded today with this important arrest.

There have been several other arrests. This one may be a breakthrough. I hope, you know, the word that Danny Pearl is alive is true, and I hope that he will be released safely, very, very soon.

WOODRUFF: Ann, you've had a lot of experience over the years with journalists in peril. In your experience, what would be the calculations right now, as best we can tell, on the part of the people behind this kidnapping, if they were deciding to release him?

COOPER: Well, it's very, very hard to know, because there have been so few contacts, so few messages from these people, and because there have been false messages sent out -- E-mails, you know, purporting to be from the kidnappers that apparently were false.

But, you know, I think that the message that everyone has tried to convoy to these kidnappers is: you are not accomplishing anything positive with this. No one has really paid any attention to your demands. If anything, those demands will be less listened to, as long as they're holding a journalist captive. And I hope that that message has gotten through, and that Danny will be released.

WOODRUFF: We all hope it's gotten through, as well. All right, Ann Cooper, executive director of the Committee to Protect Journalists. Thank you.

COOPER: Thank you very much.

WOODRUFF: U.S. Attorney General John Ashcroft today is calling on Americans to be on the highest state of alert, in response to a new terrorism warning from the FBI. Intelligence officials say they have information that a Yemeni man and more than a dozen associates may be planning an attack in the United States or against U.S. interests in Yemen, as soon as today. Ashcroft says the men may be associated with Osama bin Laden or the al Qaeda network.

Now we turn to Capitol Hill and the Enron hearings. There had been talk that senators did not want to let former CEO Ken Lay off easy when he refused to testify today. The result: one tongue lashing after another. Here is our Congressional correspondent, Jonathan Karl. Hello, Jon.

KARL: Hello, Judy. As Mr. Lay exercised his constitutional right not to testify against himself, he quoted a recent Supreme Court decision that said one of the basic functions of the Fifth Amendment is to protect innocent men.

(BEGIN VIDEOTAPE) UNIDENTIFIED MALE: Do you swear that the testimony that you give to this committee will be the truth, the whole truth, and nothing you but the truth so help you god?

KEN LAY, FMR. ENRON CEO: I do.

KARL (voice-over): As predicted, Ken Lay took the Fifth, but he said his silence doesn't mean he has anything to hide.

LAY: Mr. Chairman, I come here today with a profound sadness about what has happened to Enron, its current and former employees, retirees, shareholders and other stake holders. I have also wanted to respond, to the best of my knowledge and recollection, to the questions you and your colleagues have about the collapse of Enron. I have however been instructed by my counsel not to testify, based on my Fifth Amendment constitutional rights.

KARL: But before leaving the hearing, Mr. Lay had to sit quietly while senators publicly berated him.

SEN. BARBARA BOXER (D), CALIFORNIA: Mr. Lay, I know you're not going to talk to the committee. You have a right to. But I have a chance to talk to you, so that's what I'm going to do, is talk to you.

SEN. PETER FITZGERALD (R), ILLINOIS: I'd say you are carnival barker, except that wouldn't be fair to carnival barkers. A carny will at least tell you up front that he's running a shell game.

KARL: Mr. Lay sat stone-faced, his hands on his knees, making eye contact with each speaker as the committee took him to task.

(END VIDEOTAPE)

I noticed Mr. Lay's expression changed only once. He briefly laughed when the chairman of that committee, Fritz Hollings, called him to the witness table, calling him Kenny-boy -- of course, the nickname that was preferred by President Bush. Bush's nickname for Mr. Lay. Meanwhile, Mr. Lay is going to have go through the same process all over again in two days, when he's called before a House committee. And he will gain, we are told, exercise his Fifth Amendment rights.

But he may be overshadowed on that day, Valentine's Day, Judy, because we've also just learned that Sherron Watkins, the Enron whistle blower, will be before yet another committee investigating Enron, for the first time up here on Capitol Hill, telling her side of story -- Judy.

WOODRUFF: All right, Jon Karl. But I have a feeling the cameras will still be there on Mr. Lay, even if he refuses to testify once again. All right, Jon, thanks very much.

Turning now to the other big story on Capitol Hill, the impending House debate over campaign finance reform. Our Kate Snow is following the strategy and the wrangling leading up to the vote. Hi, Kate. SNOW: Hi, Judy. And several of the supporters -- I just came from a news conference with them -- supporters of campaign finance reform, talking about Enron, and Enron being a big impetus for the momentum that they think they have going into tomorrow's vote. One key change of those supporters of what's known as the Shays-Meehan bill, the campaign finance reform bill on the House side -- one key change that they're going to make.

They are going to make the effective date of the changes in their bill, the effective date of the reform would be the day after the next election. That's something that's been discussed. They think it's more practical, and they acknowledge that it could help them win some votes. This just one of the changes they're making in that attempt to garner support, as we move into tomorrow.

(BEGIN VIDEOTAPE)

(voice-over): The phone won't stop ringing. Grassroots groups pushing for campaign reform, targeting the undecideds. Most of those on the fence, Republican moderates who voted for campaign finance reform in the past. Republican Senator John McCain is working closely with House Democrats to help them reach out to that group.

There are undecided Democrats, too. Democratic leader Dick Gephardt and the bill's democratic sponsor, Marty Meehan, are working that side of the aisle. On the line, Michigan Democrat Bart Stupak. He's under pressure from right-to-life groups he supports. They don't want a bill that bans TV ads in the days before an election. Moderate democrats who support gun rights are getting the same kind of pressure from the NRA.

Adding to the confusion: no one is sure exactly what they're be voting on Wednesday. Three bills, 20 amendments, it's hard to sort out where allegiances lie. The Republican strategy: convince enough lawmakers to change the bill through amendments. They called it improving the legislation. Supporters say that's a veiled effort to kill the bill.

REP. CORRINE BROWN (D), FLORIDA: Well, there are many poison pills, and you have no idea what the evildoers are going to bring to the floor.

(END VIDEOTAPE)

SNOW: And the House speaker, we're told, Judy, has not been very involved in pushing against this bill. We have just been told by his spokesmen that people know how he feels, and he doesn't feel he needs to twist anyone's arm or convince anyone or threaten anyone, for that matter. Tom DeLay, the majority whip, is working this one pretty hard.

And, Judy, they're in a bit of a time crunch. We should note that most of the bills that are going to come forward tomorrow and the amendments -- various 20 or so amendments that will come forward -- won't be written and published until about midnight tonight. And they start voting at 10:00 a.m. tomorrow morning -- Judy. WOODRUFF: Kate, it looks like you're going to have to stay most of the night at the Capitol to figure out what's going on.

SNOW: Exactly.

WOODRUFF: Kate Snow, thanks very much.

I was at the Capitol myself today, and got a firsthand look at some of the last-minute strategizing on campaign finance reform, when I spent the morning with Congressman Bob Ney.

(BEGIN VIDEOTAPE)

(voice-over): 10:15 a.m., the office of Ohio Republican Congressman Bob Ney, cosponsor of a campaign finance reform bill, an alternative to Shays-Meehan.

REP. BOB NEY (R), OHIO: I think it's going to be close, period.

WOODRUFF: They talked tactics, and how hard it is to get an accurate vote count.

NEY: You've got a lot of amendments here. You don't know what's going to pass or not pass. And some amendments may pass that may shift people towards Congressman Al Win and myself.

WOODRUFF: Opponents of Shays-Meehan are clearly hoping the weight of amendments will sink it.

NEY: Anything else to add? Any last-minute amendment ideas?

WOODRUFF (on camera): What determines what happens here?

NEY: Well, a couple things. First of all, Shays-Meehan has mutated as a bill. It's not the original, pure version. And the original reformers know that. We have an uncertainty of what's going to happen to these pieces of legislation. So as result, I think you're going to see a series of amendments, another series of amendments. And members are going to sit there and say, OK, what have we done now?

Now, it's going to be done on a bill that's going to affect American men and women for the next 25 years when they run for office, so we better think long and hard about it.

WOODRUFF: How active is the White House in all of this, and the people that speak for the White House, the Republican National Committee, and others?

NEY: I've had zero conversations with the president or the White House on this issue. I have a personal prediction. My personal prediction -- and I can't base this on communications with the White House at all -- I just personally think that whatever goes over there, I would guess the president is going to sign it.

WOODRUFF: You wouldn't fault him for signing it? if Shays- Meehan in some form comes to the White House, you don't have a problem with his signing it?

NEY: I wouldn't fault him at all for that, because why should he bail out some inappropriate actions as a Congress? We should be more responsible here in the House and Senate, to craft something that's appropriate, something that's constitutional, something that doesn't gag the American people, but has full disclosure and takes care of restricting soft money.

WOODRUFF (voice-over): As we walked to Ney's next appointment, a news conference with cosponsor, Democrat Albert Wynn, Ney says he doesn't believe there will be a backlash if Shays-Meehan fails, even with the Enron scandal fresh in the public mind.

NEY: This issue is not high in the ratings. People right now are worried about whether we're going to be attacked as a nation today, obviously, from the FBI reports. They're worried about the security of our country. We are in a wartime conflict. And we have an economy that's got a real problem. And that's what people are focused on.

Now, Enron gave a little bit of a boost, because frankly, you know, people running around, and were kind of indicating that, gee, if this had passed, Enron might not have folded. That's not true. And that's shameless.

WOODRUFF (on camera): Let me just finally ask you about the substance of your proposal. You would allow 75,000 per contribution to the parties, and unlimited to the state parties.

NEY: By the way, I have talked to Mr. Wynn early this morning, and we may bring that figure down in the bill. Right now it's at 75, which was the limit. We may bring it down.

WOODRUFF: Why would you do that?

NEY: Well, it makes it more appealable to limit more soft money, we would do that.

WOODRUFF: What number would you bring it to?

NEY: Probably down to around 25,000.

WOODRUFF (voice-over): At the news conference with Congressman Wynn, they talked about their willingness to compromise. But Ney did not repeat his offer to bring the soft money limit down to 25,000.

(END VIDEOTAPE)

And Congressman Ney's staff says that no number has finally been decided, that they're looking at 25,000, but no final decision yet.

Congressman Ney may downplay any link between the new push for campaign finance reform and Enron's collapse. But Ron Brownstein of "The Los Angeles Times" sees a clear connection. Ron?

RON BROWNSTEIN, "LOS ANGELES TIMES": Judy. Ken Lay would probably decline the honor, but if the House of Representatives approves the campaign finance reform bill it's debating this week, the Enron corporation's spectacular collapse can claim part of the credit.

(BEGIN VIDEOTAPE)

(voice-over): It was the Enron scandal that won reform supporters the last votes they needed to force the issue to the floor, which puts Enron in a long tradition of scandals that have changed the political landscape. Through American history, scandal has been the most powerful engine of reform. From the federal food and drug laws that sprang from the progressive era exposes of the Chicago stockyards, to the federal securities regulations that followed the Wall Street scandals of the roaring '20s, to the modern campaign finance laws that grew from Watergate.

UNIDENTIFIED MALE: What did the president know, and when did he know it?

BROWNSTEIN: In all these cases, scandal has propelled forward reforms that otherwise might never have overcome the resistance of special interests. Scandal doesn't always produce action. Even this week in the House, the result is uncertain.

But scandal tilts the balance toward reform, by riveting public attention and increasing the pressure on Congress to act, which reduces the influence of money and lobbyists.

(END VIDEOTAPE)

The problem for reformers is that when the outrage fades, so does the pressure on Washington. When it comes to Enron, reform delay is likely to be reform denied -- Judy.

WOODRUFF: All right, Ron Brownstein, thank you very much.

Question: is there a political lift for the organizer of the 2002 Winter Olympics? Coming up next, we'll ask Mitt Romney about his future career plans, as well as the unprecedented security at the Games in Salt Lake City.

Later, Vice President Cheney's daughter, Liz, tells us what she's up to, politically speaking, in New Hampshire.

Plus, Jeff Greenfield on the dog-eat-dog world of pet shows, and presidential politics. This is INSIDE POLITICS.

(COMMERCIAL BREAK)

WOODRUFF: "On the Record" this Tuesday: Salt Lake City Olympics CEO, Mitt Romney. He has been a success in business. He's also tried his hand at politics. Today he joins us from Utah to talk about the Olympics and about his future. First of all, Mitt Romney, we thank you for standing there for a few minutes. We know you're hoarse, you were just telling me, from cheering for the U.S. and other teams.

MITT ROMNEY, CEO, SALT LAKE ORGANIZING CMTE.: It's been extraordinary out here. This has been one of the most fun events in my entire life. And the U.S. team has done so well, it's just hard to stop yelling. But I understand I better be quiet here for a while, or it's going to be hard for me to have any voice at all.

WOODRUFF: Did you and others on the Olympic organizing committee get any advance word about this new terror threat issued last night?

ROMNEY: We did not. We were told that this was a fact as soon as it had been announced to the public generally. We were also told that there was no mention whatsoever of Olympics or Olympic venues. This seems to be a generalized threat, not something which is targeted to the Olympics. And as you know, we have an enormous presence here from the Secret Service and other federal agencies and military, to make sure that the Games are as safe as humanly possible.

WOODRUFF: Is this new threat affecting security at the Games?

ROMNEY: Well, everybody is on high alert. We already have a very strong force in place, almost 10,000 federal agents and military officers. And with the threat in place, everyone is just being that much more careful, that much more diligent. As we look through bags and as we wand people, people are being very careful to make sure that nothing happens here.

WOODRUFF: Are the Games safe?

ROMNEY: I believe the Games are as safe as humanly possible. This is the first time I think in the nation's history that all of the federal agencies are working together on a highly collaborative basis to protect a venue as substantial as the Olympics. And they're doing that in conjunction with the Utah Public Safety Command, such that there's one command structure, highly coordinated. And the security plan is really a seamless web.

I think every possible source of threat has been identified, and has been addressed. That doesn't mean there's a 100-percent guarantee. I don't think that's possible, in the world of counterterrorism. But what there is is a confidence that everything is being considered.

WOODRUFF: To the Games themselves. Last night there was a dispute in the pairs figure skating between Canada and the Russians over who should have won. Do you believe there's ever a time when the judges' ruling should be looked at again?

ROMNEY: Well, the interesting thing about the Olympics and the sports that are here, is they're each -- each sport is governed by its own international sport federation. And they have their own rules as to whether they review judges or not. They very much have the same interest that all of us do, which is to have Games that people have confidence in, where they believe that the judging is fair.

And I think the International Skating Union is doing its very best to try and increase their credibility. And they've got a lot of work to make sure people have confidence in that. But I'm going to leave that decision up to them. WOODRUFF: Mitt Romney, there's talk in Massachusetts and probably elsewhere today, about your own future, political future, that coming off a successful Olympics, you may be taking a look at the landscape. In fact, you were you quoted yesterday or today in the "Boston Herald," as saying, "I'll take a close look at the political landscape when the Games are over, not only what's in Massachusetts, but other places as well." What do you mean by that?

ROMNEY: Well, I have spent a career in business, which I have enjoyed enormously. But I've found that this last three years of working for the Olympics has been far more satisfying and rewarding and fulfilling. And I intend to spend the rest of my life working in public service type responsibilities. And whether that's a volunteer organization or whether that's working in public life through politics, time will tell.

You know, in the world of politics you have to have a window open at the right time. I'm not sure there will be one at the right time, but I'll evaluate that very closely and decide if that's the way to go. It's something that my wife and I did in 1994 running against Senator Kennedy in Massachusetts. It was a great thrill for our family. There is more I'd like to do there.

WOODRUFF: Well, speaking of Massachusetts, the acting governor, your fellow Republican, Jane Swift, has been saying that your allies are saying that you won't run for governor, you wouldn't challenge her. Have you absolutely ruled out running for governor this time?

ROMNEY: I'm pretty careful not to absolutely rule out anything. But I do think it would take a very unusual circumstance for me to run against an incumbent in my own party. But I'm very careful to make sure that even when doors seem closed, there's always a little opening.

WOODRUFF: So you're leaving that door open?

ROMNEY: Open isn't perhaps the right word. I'd just say it's slightly ajar, as would be any possible race. I'm going to evaluate them as carefully as I can, and see whether I would be able to make a contribution and whether I'd have a chance of winning. But I must admit at this stage, I'm so consumed with these Games, and we're only five days into them. It's a long way to go before we have successful Games, and I really haven't had any time to evaluate the landscape. I hope to do that later.

WOODRUFF: All right. But if not Massachusetts, maybe Utah.

ROMNEY: Again, I don't want to rule anything out, nor do I want to indicate something is being considered, because at this stage, I really have not considered any one of those political options. My time is really focused on the Games. As you can imagine, this is a huge responsibility. And when the Games are over and when everything is settled, then I'll sit down and see where from there. And I think that's probably the way people would expect me to take my responsibility for these Games. WOODRUFF: Mitt Romney, CEO of the organizing committee for the Salt Lake City Olympics, thank you very much for joining us. And take care of that voice.

ROMNEY: Thanks, Judy.

WOODRUFF: Thank you, we appreciate it.

The former chairman of Enron arrives on Capitol Hill. The INSIDE POLITICS news cycle is next.

(COMMERCIAL BREAK)

WOODRUFF: A quick check of the stories in the INSIDE POLITICS "Newscycle": Emergency crews are on scene in Pittsburgh this hour where part of the city's new convention center has collapsed. At least one person is reported dead. The collapse was reported about an hour ago in phase two of the project, which was still under construction. CNN will continue to follow this story and bring you developments as they happen.

Investigators say a British-born Pakistani militant arrested today is believed responsible for the kidnapping of reporter Daniel Pearl. Police quoted the suspect, known as Sheikh Omar, as saying Pearl is still alive and still in Karachi, the city where he disappeared three weeks ago.

Also, at the Capitol, Democrat senators blasted Republican TV ads now running against five Democrats facing reelection. All five of them voted against the president's economic stimulus package. The ads, which feature President Bush, accuse the senators as putting partisan politics ahead of national interests. Senator John Breaux, who often votes with the president, was among those who criticized the ads.

(BEGIN VIDEO CLIP)

SEN. JOHN BREAUX (D), LOUISIANA: It doesn't behoove anybody to target people who have shown a willingness to work together and be cooperative with a cooperative spirit. If anything can kill the effort to work together, it's politics as usual.

(END VIDEO CLIP)

WOODRUFF: A Democratic strategist is telling CNN that the senators who were targeted by those ads plan to defend themselves with television ads of their own within days.

Well, the president's relations with House and Senate members are among the topics we want to deal with in today's "Taking Issue" segment. And joining me here in Washington: Peter Beinart. He's editor of "The New Republic." And in New York: Deroy Murdock of Scripps Howard.

Deroy Murdock, to you first. The Democrats now complaining to the president directly about these National Republican Senatorial Committee ads running against five Democrats who voted against the president on the economic stimulus. They're running for reelection. What should the president do here?

DEROY MURDOCK, SCRIPPS HOWARD: What he should tell them is that it's an election year and this sort of thing is bound to happen sooner or later.

There were ads that the House Democrats put on earlier this year, I believe, in which Congressman Nita Lowey made some comment, I believe, about how President Bush was unpatriotic. She referred to the Bush recession. So this is not something that the Bush side started. This is going to be a campaign year, an election year. And this sort of thing is going to start and continue all the way to November.

WOODRUFF: Peter Beinart, should the president just ignore this request from Senators Kennedy and Breaux?

PETER BEINART, EDITOR, "NEW REPUBLIC": He probably will ignore it. But I think he should probably pull the ads, because, even by the standards of election-year politics, they are deeply disingenuous.

The truth is, the Bush administration doesn't want the stimulus package either and for a good reason, because, as Alan Greenspan has said, the economy looks like it's recovering. And to stimulate it now would probably overheat it and lead Greenspan to raise interest rate. So I really think it's in bad faith, these ads.

WOODRUFF: Let me turn you both to Capitol Hill, Ken Lay today testifying before a Senate committee.

Let's listen to something that we heard today from Senator Peter Fitzgerald, Republican of Illinois.

(BEGIN VIDEO CLIP)

SEN. PETER FITZGERALD (R), ILLINOIS: And, you Mr. Lay, you have every reason to stand and speak, but you will walk away. You will raise your right hand, you will take the Fifth, and then you will walk out that door. And when you walk out that door, it will be a stunning coda to the collapse of Enron.

(END VIDEO CLIP)

WOODRUFF: Deroy Murdock, without the testimony of Ken Lay, are these hearings really producing anything?

MURDOCK: Well, I think what they are producing, really, is penance for both Republicans and Democrats. Enron was very generous in giving both to Republicans and Democrats. And by beating up on Enron now, they have the opportunity to run away from this financial disaster.

Enron now is being pitched as sort of a Republican scandal. But during the Clinton administration, Enron got a lot of help from the Overseas Private Investment Corporation. Other parts of the Clinton administration do investments in India. And you don't hear very much about that.

I will say, if the White House is smart, they will put out the list of names of people who met with Dick Cheney. If they have something to hide, they should get it out now, not a little bit before November if a court decision says they have to release that information. And if they have nothing to hide, it would be very smart for them just to bring it in the sunshine and get that entire issue behind them.

WOODRUFF: Peter Beinart, the hearings worthwhile?

BEINART: Not these hearings. I think the hearings with the former Enron executives are really meant for politicians to grandstand and, as was said earlier, to kind of divert attention away from their own culpability.

The important hearings I think are the ones that don't get as much attention, the ones that actually focus on legislation, questions of pension reform, the accounting industry. And that's where you really see that a lot of politicians haven't learned the lessons of Enron at all. They are still fighting for the same old giveaways to corporations.

MURDOCK: Absolutely correct.

(CROSSTALK)

WOODRUFF: Sorry.

I just want to quickly finally ask you both on about this new congressional investigation disclosing a little more detail about the gifts received by former President Clinton and now Senate Hillary Rodham Clinton, some $75,000 worth of gifts in furniture and housewares.

Deroy Murdock, is this new? Her office says it isn't.

MURDOCK: Well, I think we are getting further detail. And what we are getting is just another confirmation that they left the White House looking pretty much like Ferdinand and Imelda Marcos leaving the Malacanang Palace.

And, sadly, there has really been no consequences and no repercussions for the way the Clintons behaved over an eight-year period, whether it's Whitewater or the pardon scandal, which seems like it has gone nowhere in terms of the investigation, the sort of looting of the White House as they left. And they just have laughed all the way to Chappaqua. And I think that's a shame. I really would like to see some consequences, some price paid their part for their behavior.

WOODRUFF: Peter Beinart.

BEINART: Yes, I really couldn't disagree more. The truth is, if these people who were giving these gifts don't have an agenda or business before Hillary Clinton as a senator, it's actually no worse than much of what the Republicans are fighting to kill this week, which is campaign finance reform. And I don't think it's any coincidence that this came out just at the time that the Bush administration is having trouble with Enron.

The fact is, the administration got a lot of benefit from the hangover of Clinton scandals last year. They want that same benefit to divert attention from their own problems.

MURDOCK: And, again, you saw lots and lots gifts from people who got pardons and other kinds of -- all sorts of favors, public favors, from the Clintons. So I think there is a lot of quid pro quo. And I think that deserves investigation and prosecution...

WOODRUFF: Sorry. I didn't mean to cut you off. Finish your point.

MURDOCK: The point is simply that this should be investigated. If there's culpability and some quid pro quo, there should be prosecution for this.

WOODRUFF: All right, Deroy Murdock of Scripps Howard, we thank you. Peter Beinart of "The New Republic," good to see you both. We appreciate it.

MURDOCK: Thank you.

WOODRUFF: And when loyalty seems in short supply in Washington, presidents often turn to man's best friend. Just ahead: Jeff Greenfield on the political lessons learned from canine companions.

(COMMERCIAL BREAK)

WOODRUFF: Joining us now with the latest "Inside Buzz," our Bob Novak.

First of all, Bob, what are you hearing about the fight over campaign finance reform?

ROBERT NOVAK, CNN POLITICAL ANALYST: The thing that is moving around it that it appears that the House Democratic leader, Dick Gephardt, who will have the last motion just before final passage, called a recommittal motion, is going to put out a motion which would restore the bill to its original form.

Now, what that means is, the Republicans and the critics who may pass some amendments, amending the bill, maybe anti-labor and so on, all of this will be changed in the final version, which then would, in effect, go straight to the president without a conference. What that means is, somebody could vote for the Republican amendments and vote for the final bill and they could get the vote each and every way. The vote on the Gephardt motion, I'm told, will be very close.

WOODRUFF: Is this definite that Gephardt is going to do this?

NOVAK: No.

WOODRUFF: We're not sure yet.

Unusual plans for Dick Cheney, going to the Middle East soon?

NOVAK: Vice presidential trips have turned into circuses because very little business is down. Remember Lyndon Johnson's -- well, you are too young for that.

WOODRUFF: Much too young.

(LAUGHTER)

NOVAK: But he has very spectacular -- I remember it well. And you do remember the Spiro Agnew and the Dan Quayle trips were circuses.

Dick Cheney is going on 10-day trip to the Middle East. And his staff is considering whether they really want to take any press along, no members of the media whatsoever, to avoid all these made-up stories. They are very serious about it. No decision has been made, but they may say, hey, this is a business trip and we don't need the media. After all, he goes to undisclosed locations without the media.

WOODRUFF: That would be almost unprecedented.

NOVAK: Without precedent, absolutely.

WOODRUFF: The Global Crossing bankruptcy, new information bubbling out of that politically.

NOVAK: Well, in the first place, the workers in Global Crossing were members of the Communication Workers of America. And I'm told by labor sources that they have been flooding the AFL-CIO headquarters. They want the union to say something about that as they are saying something about Enron.

But there are very strong Democratic connections with Global Crossing. Terry McAuliffe made a lot of money on stock. And so there is some hesitancy by John Sweeney, the AFL-CIO president, to do anything. Now, the Republicans want -- they want to start using the Global Crossing as a Democratic scandal. But the truth is, there are lot of Republicans who made money on Global Crossing as well.

The trouble with these scandals and these investments, they are bipartisan.

WOODRUFF: All right. Well, yes, we have heard that before. Bob Novak, thanks very much. We will see you later this week.

NOVAK: Thank you.

WOODRUFF: They travel with the president and they accompany him in his most private moments, but they are not even on the government payroll.

Senior analyst Jeff Greenfield has some thoughts on the most loyal of White House residents in today's "Bite of the Apple." JEFF GREENFIELD, CNN SR. ANALYST: It is one of the most famous bits of political lore in Washington: Harry Truman's observation that "If you want a friend in Washington, you better get yourself a dog."

Well, today, right across the street from CNN here in New York, the Westminster dog show is wrapping up competition. And therein lies a political tale with some very significant lessons.

(BEGIN VIDEOTAPE)

(voice-over): Lesson No. 1: No sane politician would own one of those exotic doings, no chow chows, no Maltese, no American Eskimo. Ah, now, this is more like it, a Scottish terrier, like FDR's Fala, who gained immortality when Roosevelt knocked Republicans for attacking his little dog, or like George W. Bush's Barney, a Scottish terrier, or Spot, springer spaniel.

Springer spaniels run in the Bush family. Barbara made a best- selling author out of Millie. Or think of Richard Nixon's famous Checkers, the dog he promised his kids could keep back in '52. If Checkers had been some frumped-up Pomeranian, Nixon never would have survived.

But, later, things turned ugly for Nixon on the canine front. King Timahoe, the presidential Irish setter, never took much of a shine to Nixon. So the president had to stuff his pockets with appetizing dog treats for the right photo-op.

President Clinton, his approach to pets reflected his whole third-way philosophy. Socks the cat obviously didn't appeal to dog lovers. So enter Buddy, the chocolate lab retriever. Now, if you think presidents and their aides don't pay a lot of attention to all this, take a look at this scene from "Dave," the classic satire about an evil president replaced by a good guy double. We know the president is a louse even before the opening credits end. How.? Because as soon he enters the White House, out of public view, he contemptuously dismisses the dogs.

(END VIDEOTAPE)

GREENFIELD: So you get the point here. If the president doesn't like dogs, he must be a creep. And, by the way, keeping dogs of the politically powerful happy is very important. Back in 1968, RFK aide Dick Tuck was mocked by reporters when they saw him walking one of Robert Kennedy's dogs. "Hey," Tuck said, "to you guys, these are dogs droppings. To me, it's an ambassadorship" -- Judy.

WOODRUFF: Jeff, do you have a dog?

GREENFIELD: No, ma'am. I have a cat. So I guess I can never be president.

(LAUGHTER)

WOODRUFF: For deep discussion, tell us about "GREENFIELD AT LARGE" tonight. GREENFIELD: We span the globe tonight, Judy. We are going to talk about Iran and why the administration came down so hard on Iran in the State of the Union. We're also going to talk about the Oscar nominations with veteran handicapper and cinema genius Roger Ebert. So we're cutting a wide swathe tonight.

WOODRUFF: All right, Jeff Greenfield, we will be watching. Thank you.

GREENFIELD: Thank you.

WOODRUFF: We will ask Vice President Cheney's daughter, Liz, about her political venture in New Hampshire when we come back.

(COMMERCIAL BREAK)

WOODRUFF: At a time when the U.S. is engaged in a war on terrorism, the activities of radical environmental groups are under new scrutiny on Capitol Hill, especially those known to engage in destruction of property.

With today's "Back Page," here is CNN environment correspondent Natalie Pawelski.

(BEGIN VIDEOTAPE)

NATALIE PAWELSKI, CNN ENVIRONMENT CORRESPONDENT (voice-over): The United States' biggest ski resort, an Indiana subdivision, a biology lab at the University of Minnesota: a few of the targets considered torch-worthy by radical environmentalists.

CRAIG ROSEBRAUGH, FORMER ELF SPOKESMAN: They are trying to protect those very elements we all need to survive on this planet: clean air, clean water and clean soil.

PAWELSKI: Craig Rosebraugh is the former spokesman for the shadowy Earth Liberation Front. On its Web site, the ELF claims credit for about $40 million worth of destruction since 1997 and offers like-minded people tips for setting fires.

ROSEBRAUGH: The Earth Liberation Front is around to threaten commerce of those industries that are bent and focused on profiting off the massive destruction of the environment. But, as far as a threat to national security, being that of the public of the physical harm that may come to the public, no, they pose no threat, and they have never posed any threat.

The congressman whose district saw the ELF's most expensive attack, fires set at the Vail ski resort that caused $12 million in damage, sees things differently.

REP. SCOTT MCINNIS (R), COLORADO: This is not a freedom of speech. And it's time that we take away the Robin Hood mystique. These people are criminals and they are terrorists.

PAWELSKI (on camera): At a time when terrorism has proven deadly on a grand scale, some question attaching the terrorism label to a movement that targets property, not people's lives. Then again, these days, destroying buildings for ideological reasons seems an unlikely way to win support for any cause.

Natalie Pawelski, CNN, Washington.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

WOODRUFF: Checking our "Campaign News Daily": Al Gore takes another step back into the political spotlight tonight with a speech in New York on terrorism. Sources tell CNN's Candy Crowley that Gore will make clear he supports President Bush's policies -- quote -- "so far." The speech is one of several policy speeches Gore says he plans to make this year as he campaigns for Democratic candidates.

Well, many Republicans across the country take part in a political tradition today: annual dinners marking Abraham Lincoln's birthday. At the Lincoln dinner in Nashua, Vice President Cheney's will be a featured guest.

And Elizabeth Cheney Perry joins us now from New Hampshire.

Ms. Perry, thank you for being with us.

ELIZABETH CHENEY PERRY, DAUGHTER OF VICE PRESIDENT DICK CHENEY: Thanks, Judy. It's great to be here.

WOODRUFF: Did you volunteer for this or did they have to twist your arm?

PERRY: No, I'm happy to be able to do it. It's a real pleasure to be up here in New Hampshire and to be talking at Lincoln Day dinners about the important things that are going on now with this administration and the leadership of our president. So I'm thrilled to be here.

WOODRUFF: What is your main message to Republicans in New Hampshire?

PERRY: You know, I'm talking about the president's agenda as he laid it out in his State of the Union address and about what this means for our children. As the mother of three daughters, I think it's really important to talk about the fact that this president and this administration are really shaping the country that they will inherit, and the extent to which our national security is so important, and his with efforts with respect to education and the economy also.

So I'm really talking about where the president is leading the country.

WOODRUFF: Do Republicans have a problem with the women's vote?

PERRY: I don't think we have a problem with it, but I think that we could do better. We could do more to encourage more women to vote for the Republican ticket. And I think that this president has already made impressive inroads in that respect.

And I think that you will hopefully see some results of that. But his emphasis on things like education and on working in a bipartisan effort to enact legislation that moms and young women care very much about I think are something that is in fact drawing interest from women around the country.

WOODRUFF: We know that there is going to a challenge, a primary challenge in New Hampshire in the race for Senate, Bob Smith being challenged by Congressman John Sununu. Which of the two, Liz Cheney Perry, is stronger to go up against Governor Jeanne Shaheen, who now says she is running for the Senate?

PERRY: You know, I think that New Hampshire has probably the strongest history of any state in the nation of exciting primaries. And I think that we should leave that to the people of New Hampshire to decide.

WOODRUFF: So you are not going to pick which one?

PERRY: I'm not going to wade into that one, Judy.

(LAUGHTER)

WOODRUFF: All right.

Let me also ask you about this standoff we're all well aware of between your father, the vice president, and the General Accounting Office over whether he should, the White House should release records of the energy task force. Is your father reconsidering his position on that?

PERRY: My father has a very, very strong commitment and belief in the principles at issue here. He has served in I think five administrations now. And he and the president feel very strongly about the need to ensure that they are able to get unvarnished advice from people. So I think that you will see them sticking by their principles on this one.

WOODRUFF: All right, Elizabeth Cheney Perry, who is in New Hampshire to speak to the Republican Lincoln Day Dinner, we thank you very much.

PERRY: Thanks, Judy.

WOODRUFF: And we'll see you back in Washington.

Keeping in it the White House family, Laura Bush's late-night adventure next on INSIDE POLITICS.

(COMMERCIAL BREAK)

WOODRUFF: First lady Laura Bush is getting kudos for her light touch during her appearance on "The Tonight Show With Jay Leno" last night. Mrs. Bush took on a topic that Leon and others late-night comics have had a field day with.

(BEGIN VIDEO CLIP)

LAURA BUSH, FIRST LADY OF THE UNITED STATES: I know you've been doing a lot of jokes about a pretzel, so I thought I would actually show everyone in the United States what the pretzel looked like.

JAY LENO, HOST: Wow, oh, ooh, that's a nice...

BUSH: You can tell it isn't really a sissy pretzel.

LENO: No, no, not a sissy. Not a sissy pretzel. Only Texas would have a word like sissy pretzel.

BUSH: Yes. But now you will be glad to know the president will practice safe snacks.

(END VIDEO CLIP)

(LAUGHTER)

WOODRUFF: OK. Laura Bush last night.

CNN's coverage continues now with "WOLF BLITZER REPORTS." Thank you for joining us. I'm Judy Woodruff.

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