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Inside Politics

How the White House Will Handle July Fourth Fears; Will the WoldCom Scandal Affect Voting?; J.C. Watts Will Quit After Fourth Term

Aired July 01, 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.

Americans are gearing up for a holiday of fireworks and perhaps fears. What are officials doing to keep us safe from terror on the Fourth of July?

JOHN KING, CNN SENIOR WHITE HOUSE CORRESPONDENT: I'm John King at the White House. I'll tell you whether the Bush administration is likely to place the nation on an even higher level of alert.

WILLIAM SCHNEIDER, CNN SENIOR POLITICAL ANALYST: I'm Bill Schneider in Los Angeles. Politicians are talking a lot about corporate responsibility. But is the WorldCom scandal making a big impression on voters?

KATE SNOW, CNN CONGRESSIONAL CORRESPONDENT: I'm Kate Snow on Capitol Hill. The only African-American Republican in the U.S. Congress calls it quits. I'll look at J.C. Watts' decision and the hole it leaves in the Republican leadership.

WOODRUFF: Thank you for joining us. On this July 1, the possibility of a terror attack on Independence Day is on the minds of many Americans as they begin vacations or as they start to seriously consider their plans for the fourth. For its part, the Bush administration is urging people to go ahead and celebrate the nation's birthday, but also to keep their guards up.

(BEGIN VIDEOTAPE)

(voice-over): It's a nightmare scenario that the government is taking very seriously.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: In Washington, D.C. we've got a lot of good folks who are spending a lot of time chasing down any hint or any lead, any idea that somebody might have to hurt us. We're on it.

The president's national security team met today but decided not to raise the official threat level. But the FBI is asking law enforcement agencies to be extra vigilant. On Wednesday the Bureau sent a private alert to some 18,000 state and local agencies. The FBI itself plans to monitor major events and parades. Here in Washington, as the fireworks are being prepared for another spectacular display, the mayor is promising extra security. And in New York, Mayor Michael Bloomberg urged people to plan for the fourth without fear.

MAYOR MICHAEL BLOOMBERG (R), NEW YORK CITY: The overriding message that we have concerning security in New York on the fourth is, relax and let our law enforcement professionals do the worrying for you. It will be the best way to stick it to the terrorists. It will show them that we are not afraid and that they have not succeeded.

(END VIDEOTAPE)

WOODRUFF: Our senior White House correspondent, John King, is here now. John, we reported the national security staff council advising not to raise the terror, the threat level. Why not?

KING: They say, Judy, here at the White House there's simply not enough credible specific evidence to do so. The homeland security council, Governor Tom Ridge, hosting that meeting. The attorney general was here today, other law enforcement officials across the administration.

Yes, as you pointed out, there is a concern that July Fourth could be an intriguing and perhaps irresistible target to the terrorists. But sources here tell us there is no specific or credible information at all suggesting there would be an attack on any specific site here in the United States.

Because of that, it simply does not meet the guidelines for raising the threat level, which is now at yellow, which says elevated -- there's an elevated risk, in the view of the government -- of a terrorist strike. To go up to the next level, orange, would be a high risk. U.S. officials say the intelligence data they look at, while troubling sometimes, simply doesn't meet that test.

WOODRUFF: John, is there some concern that people might not take these threats seriously and then let their guard down after the Fourth?

KING: After the Fourth is a deep concern to many folks here at the White House, especially in the homeland security apparatus. They would argue not that the government shouldn't prepare for July Fourth, but if you look at the M.O. of al Qaeda and other terrorist groups, that they are unlikely to attack what are called hardened targets, meaning when security is at its peak. Why would they attack then?

The greater concern here in the White House is that the American people will once again hear all this talk of warnings, all this talk of potential threats of attacks. And if the holiday weekend passes, as we hope it does, with no terrorist attacks, that after that people might get complacent and let down their guard.

The administration says that's one of the reasons they don't want to jump up the threat level, just to bring it down after the holiday. They want people to view this as credible when they do adjust that threat level.

WOODRUFF: All right, John King at the White House.

And now we want to go to one of the places where security is being tightened for July Fourth, and that is the national mall here in Washington. CNN's Jeanne Meserve is there.

Jeanne, is there a concern that all of this talk about the terror threat, about increased security measures, is going to keep people away?

JEANNE MESERVE, CNN CORRESPONDENT: There is some concern. I spoke to at least one official today who expressed the opinion that perhaps people would be nervous. But we've talked to many tourists down here this afternoon. Not one of them has indicated they plan to stay away from the festivities. They plan to come.

The security preparations here have been extensive. Miles and miles of snow fencing are being put up. That's going to create a double perimeter around the entire mall. Two-thousand federal and local police officers from 16 different agencies will be here.

They're going to be not only screening people, but looking in coolers and in backpacks. There are going to be dozens of bomb- sniffing dogs and other sorts of detection technology that's a little less obvious. They're closing the D.C. bank of the Potomac River.

The Memorial bridge, which as you know, is a major route between Virginia and D.C., will be shut down. A subway stop which has an entrance and exit on the mall will also be shut down that day. It is a huge effort.

The hope is that it will be big enough to deter terrorists, but not so big that it will deter tourists. They want people to come down and show the colors, particularly this July Fourth -- Judy.

WOODRUFF: All right, Jeanne Meserve on the mall near the Washington Monument. Thanks, Jeanne.

And now we turn to the WorldCom scandal. The embattled company told the Securities and Exchange Commission today that its accounting problems may go back as far as 1999. As new details surface, our new poll shows 20 percent of Americans think misconduct by large corporations is at a crisis level.

Fifty-seven percent say it is a major problem. Seventeen percent say a minor problem. Only 3 percent say it is not a problem. Our senior political analyst Bill Schneider is with us now from Los Angeles.

Bill, did Democrats have some advantage here on this issue of corporate responsibility?

SCHNEIDER: Well, Judy, on the surface you would say people are pretty cynical about this issue. Over 60 percent say big business has too much influence over Democrats, too much influence over Republicans and too much influence over President Bush.

In fact, in our latest poll, President Bush's job rating has been unaffected, stands at 76 percent. And 63 percent approve the way he's handling the economy. That has not changed.

But do you see evidence on one issue. We asked people, do you think that President Bush is more interested in protecting the interests of ordinary Americans, or the interests of large corporations? As you can see here, people, a majority, say that President Bush and the Democrats are more interested in protecting ordinary Americans. But only 30 percent say that about the Republicans.

So, if the Democrats want to make it an issue, they have to make it an issue against the congressional Republicans, their opponents in the midterm election this year. They won't make much headway in running against President Bush, who has just as much credibility on this issue as the Democrats do.

WOODRUFF: So, Bill, given all this, I know we're months away from midterm elections, but at this point, what role do you think all this is going to play in the elections?

SCHNEIDER: Well, we're not finding that the issue of corporate responsibility weighs very heavily in the voters' decisions. In fact, it weighs much below the economy, the war on terrorism, education, Social Security, prescription drugs. But we also know something else.

We know that corporate responsibility is an issue that affects the stock market. And our poll shows that the stock market has a very big impact on people's view of the economy and their view of their own financial situation -- much larger than in the past because 2/3 of Americans are now invested in the stock market.

Two-thirds tell us that the stock market, the current condition of the stock market, makes them less confident about the economy. Sixty-four percent say they're less likely now to invest in the market. A majority say they're less confident about their own retirement because of the stock market. And people are evenly split over whether the market makes them less confident about their own financial situation.

So what we're seeing, Judy, is a new relationship, that corporate responsibility affects the market and the market affects the way people see the economy and see their own financial well-being. The critical link here is the condition of the stock market -- Judy.

WOODRUFF: All right, Bill Schneider, fascinating, piecing it all together. Thanks very much.

The fourth-ranking Republican in the House of Representatives, charged with honing the party's political message, delivered his swan song today. Congressman J.C. Watts of Oklahoma announced that he will not seek a fifth term this year. As our Kate Snow reports, Watts' decision leaves a void in the GOP leadership and within the ranks of African-Americans on the Hill. (BEGIN VIDEOTAPE)

REP. J.C. WATTS (R), OKLAHOMA: You've honored me greatly by giving me the privilege of representing you in the halls of Congress.

SNOW (voice-over): Struggling for the words, Watts announced he would not seek another term.

WATTS: I know this will shock and amaze many, but Frankie and I have five kids. Three are still at home, ages 11, 12 and 17. And, friends, there are four reasons that I chose to retire at the end of this session: Frankie, Jennifer, Julia and Trey.

SNOW: Elected in 1994, Watts says it was never his intention to make a career out of Congress. But the former star quarterback did get his share of the political spotlight. At the 1996 convention, he was one of the first to articulate a Republican definition of compassion.

WATTS: You see, Republicans don't define compassion by how many people are on AFDC and public housing and on food stamps. You see, we define compassion by how few people are on food stamps and AFDC and public help.

(CHEERING)

SNOW: One year later, a prime time response to President Clinton's state of the union.

WATTS: I got my values growing up in a poor black neighborhood on the east side of the railroad tracks, where money was scarce. But dreams were plentiful.

(END VIDEOTAPE)

SNOW: Watts was a logical choice for the leadership when they were looking to be more diverse back in 1998. And, Judy, the person running for his job now is Deborah Pryce. She's probably the front runner. If she got the job, she'd be the highest ranking woman ever to ascend to that kind of rank within the Republican leadership.

I talked to Pryce today. She tells me that she wants to include even more people in the Republican message. She said she talked with both the speaker and Watts last week. But unclear, Judy, who they'll end up supporting. She's the front runner, but there are at least two others who will be in the race to succeed Watts -- Judy.

WOODRUFF: All right, Kate Snow, thanks very much.

President Bush has issued a statement saying that J.C. Watts will leave behind a political legacy of compassion and commitment to public service. But Democrats already are taking jabs at Watts' decision and the fact that it comes on the heels of House Majority Leader Dick Armey's decision to require.

A statement today from the Democratic Congressional campaign committee says, quote, "Entering the fourth quarter with the score tied this cycle, two Republican leaders, including their only quarterback, have walked off the field."

Well, is J.C. Watts leaving his party in the lurch? Next I'll ask the congressman about his decision to call it quits and the political pressures he's been facing.

Also ahead, what was Al Gore thinking when he took aim over the weekend at the Bush administration's war on terror?

We'll find out if a stylist to the political stars has any hair- raising stories to share.

And...

(BEGIN VIDEO CLIP)

BRUCE MORTON, CNN CORRESPONDENT: They've done it again. The rates on first class mail go up. If they've done anything mean to the junk mailers, that's the story I missed.

(END VIDEO CLIP)

WOODRUFF: Our Bruce Morton puts his stamp on the new price of mailing a letter.

(COMMERCIAL BREAK)

WOODRUFF: Oklahoma Congressman J.C. Watts is leaving the House of Representatives. The No. 4 House Republican said today he wants to spend more time with his family. As a former college football star and the only African-American Republican in Congress, Watts enjoyed a quick rise through the party ranks after his 1994 election. Earlier I asked him, given his unique stature, why he's calling it quits.

(BEGIN VIDEOTAPE)

WATTS: Well, Judy, I think that's probably the thing that puzzles many people. They can't imagine why one might do that. And what I'm about to tell you sounds like the politically correct thing to say. But the fact is, my family, I've been in public service now for 12 years, four in the state level, will be eight on a federal level after this term ends.

And so my family has supported me for 12 years and I think it's time that I pay a little more attention to them and do a few more parent-teacher conferences and dance recitals and little league baseball games.

WOODRUFF: Well, you're right, that's sounds like the politically correct thing to say. Let me ask you about a couple of things others have said. Congressman Tom Davis, who's the head of the Republican congressional campaign committee, said you told him you were frustrated with your role in the party. You weren't being asked to take on more responsibility. What about that? WATTS: Well, Judy, that's just not true. I think when you consider that my responsibility over the last three and a half years has been to handle the communications of the Republican conference -- that's been my responsibility, that's been my role. And I think when you talk to members from the moderate spectrum, from the conservative point of view, and everything in between, I think, using any fair and reasonable standard, they'd say that I have performed very well.

I think, you know, in a legislative process, Judy, you're always going to find yourself frustrated. You're dealing with 434 other egos and personalities, and people who are very driven and very opinionated. So there are some built-in frustrations. I think if you talked to any of us we would say that.

But the fact is, you know, I am very pleased with the role that I have been able to play, the responsibilities that the speaker has given me to say, J.C., we want you to build us a communications operation. And I think we've done that very well.

WOODRUFF: Congressman Davis also said that you told him you were upset because the White House did not consult with you, they didn't communicate with you before they announced the decision to cut funding for the crusader artillery system, which of course is being built in your district.

WATTS: Well, and I told, you know and, Judy, you know what, I told the White House that. I told them that they did not handle that very well. So I didn't say anything to Congressman Davis that I hadn't said to Don Rumsfeld or Paul Wolfowitz.

(CROSSTALK)

WATTS: But the fact is, Judy, you know, crusader is still on track. We just last Thursday came up with a compromise in the DOD appropriations bill to continue on in the mission. So I don't think they handled that properly. But the fact is, the mission continues, and doing what I want to do.

WOODRUFF: Let me just quote a couple of other things. Our congressional correspondent, Kate Snow, interviewed a House Republican leader last week, in the last few days, who said they were -- quote -- "fed up with your pouting and whining." One, in fact, said I don't want to make myself available for any more of his pouting. How do you account for this?

(LAUGHTER)

WATTS: Judy, what I say is, you know, bless their hearts. You know, that -- I'm quite tickled at that. I'm quite amused by that. But, the fact is, you know, it is time for me to move on. And, you know, I've had a great journey. My objective -- I said I was going to run for three terms. And the speaker talked to me in the 2000 cycle and I decided to stay on. That was the right decision.

But today it is the right decision for me to leave. And so I'm sure -- and, Judy, I can assure you, there's going to be some in the conference, those folks that you quoted, I suspect they'll be glad that I'm leaving. But the fact is, I've had a great run. It's been a great journey and I've had the support of the speaker and the great, great majority of the members -- the great, great majority of the members in the Republican conference have been very supportive of me.

WOODRUFF: Did they try to talk you out of this, the leadership of the House? Speaker Hastert, Mr. DeLay?

WATTS: Judy, I've talked to everybody from, yes, Tom DeLay, Speaker Hastert, the majority leader.

WOODRUFF: President Bush, the vice president?

WATTS: President Bush, the vice president, Rosa Parks. You know, I thought that was hitting a little below the belt to get Rosa Parks involved in this. But yes, I've talked to everybody and I've told them. And they've been very respectful of why I have chosen to end this chapter in my life and to move on.

WOODRUFF: Let me just step back for a moment and ask you, what do you think it says about the Republican Party, that the only Republican African-American serving in the Congress is choosing to step down?

WATTS: Judy, I don't think it says anything about the Republican Party. I think it says that J.C. Watts is choosing to move on. I never got into politics to build a career, to build an empire, to have a long-term career. This really has been public service.

Now, I know that might shock and amaze you, but this has been public service for me. And I don't think -- and I don't think that I'm the only one that can serve the fourth district of Oklahoma. I think you need to, you know, be aware of getting off the stage while they're still applauding.

(END VIDEOTAPE)

WOODRUFF: J.C. Watts talked to me a little earlier today.

Well, who will replace him in Congress? We put that question to Amy Walter of the Cook political report. She says Republican Tom Cole looks like the early front runner. He was Oklahoma's secretary of state and is a close friend of Congressman Watts. A prominent GOP operative tells CNN that Cole is -- quote -- "definitely running."

For the Democrats, Lloyd Benson, a former Oklahoma House speaker is considered a potential candidate, along with Keith Butler, who considered a run for Congress earlier this year. The filing deadline is July 10.

An update from Afghanistan on the apparent U.S. bombing of a wedding party next in the "NewsCycle."

Plus, the return of Al Gore. New signs that he may be getting serious about another run for the White House.

(COMMERCIAL BREAK)

WOODRUFF: Among the stories in our "NewsCycle," as tourists gather in the nation's capital, White House officials say there are no plans to increase the nation's homeland security alert status over the fourth of July holiday. General advisories have been sent to law enforcement agencies across the country, however, urging them to be extra vigilant.

An Afghan government spokesman says between 20 and 30 people were killed when a U.S. bomb hit a wedding party in central Afghanistan. More than 60 others were injured. The wedding attendees were firing weapons into the sky in celebration. At the Bagram air base, a military spokesman says U.S. forces responded to anti-aircraft fire. The U.S. has offered its deepest sympathies for the incident.

Arizona firefighters have contained almost half of the huge wildfire that has consumed more than 460,000 acres in the last two weeks. More than 400 homes have been destroyed by the fires. But nearly all of the 30,000 people forced to flee the largest fire have been allowed to go back to their homes.

At a gathering of his supporters over the weekend, Vice President Al Gore challenged the success of the Bush administration's war on terrorism. Gore noted that the allied forces had not gotten Osama bin Laden, and he accused the Bush political team of using the war -- quote -- "as a political wedge to divide America."

Gore joined Senator John Kerry among potential Democratic presidential candidates to question the administration's war success. With us now, Maria Echaveste, former Clinton White House deputy chief of staff, and Deroy Murdock of the Scripps Howard news service.

Deroy, to you first. What do you make of this notion now, that you've got not one, but at least two Democrats running for president, thinking of running for president, openly criticizing the president's conduct of the war?

DEROY MURDOCK, SCRIPPS HOWARD NEWS SERVICE: Well, the president remains very popular, particularly on his handling of the war on terror. So, I wouldn't worry too much about it, if I were him.

I think Al Gore, rather than attack President Bush for the handling of the war on terror, ought to apologize to the American public for the Clinton-Gore administration's inability or refusal to capture Osama bin Laden when Sudan offered to turn him over to us in May of 1996. There is an excellent article in "The Washington Post" that ran yesterday by Timothy Carney and Mansoor Ijaz on the editorial page.

And they outlined how Sudan tried to turn over bin Laden and make him available to us. And the Clinton administration basically said that they were not going to bring him in because they didn't think they could get a convict before a court of law. And, of course, eventually, the Sudanese let him go. He moved to Afghanistan. And we all know what happened afterwards. So I think Al Gore ought to answer for that before beating up on President Bush for his handling of the war on terror.

WOODRUFF: Maria, an apology in order here?

MARIA ECHAVESTE, FORMER CLINTON WHITE HOUSE DEPUTY CHIEF OF STAFF: Absolutely not.

I think that this story in yesterday's paper really needs to be examined. I am not fully familiar with all that sources were based on that. But I can tell you, as a member of the Clinton administration, and especially having been in the White House when we bombed Afghanistan after the bombings of the embassy, there was no question in my mind that President Clinton and his team were committed to doing everything possible to Bring in bin Laden.

Let me say something, though, that this question about using the war for political reasons, I dare say the Bush administration has shown themselves to be a master at this. Every time there is any sort of criticism -- a few weeks ago, we were looking at the FBI, CIA, what they knew, didn't know, why it didn't work. Suddenly, that got taken off the front page because of the dirty bomber. And then we have undercutting of Cynthia (sic) Rowley's testimony on the Hill by a proposal to develop the Homeland Security Department.

So, I think that we need some political space here to question and have an open debate about how -- the conduct of the war against terrorism. That is good. That is part of our democracy. But every time Democrats seems to open their minds, it seems as if that is unpatriotic.

(CROSSTALK)

MURDOCK: I think an open discussion is helpful. And I think one place where the administration is vulnerable is on Saudi Arabia.

WOODRUFF: Deroy...

MURDOCK: We're way to warm and cozy with the Saudis, who really do behave like our enemies. And I wish we would treat them as enemies rather than our so-called moderate allies in the Middle East. They don't behave that way at all.

WOODRUFF: I want to turn you both quickly to the economy. A new CNN/"USA Today"/Gallup poll shows that the percentage of Americans who think the country is in recession is up to 52 percent, from about 45 percent last month.

Are these corporate scandals, Deroy, taking a toll now on people's perceptions about the economy? And could it eventually be a political problem for the president?

MURDOCK: Well, it's interesting. The gross domestic product actually grew 6.1 percent. I don't know anybody who actually feels that, but we're -- at least, not statistically -- in a recession.

But the falling Dow, it's almost like losing your blood pressure. Eventually, you get very faint and light-headed and maybe fall over. And these corporate scandals are both an economic problem in terms of falling stock prices and potentially a political problem for the president and Republicans, who I think need to put some distance between the sort of traditional Republican coziness with big business and these big businesses that are behaving so badly. Now, most companies are behaving well. But these are out of control.

And one way to do it is for President Bush to end corporate welfare, these tremendous handouts that go to corporations, which ought to be able to stand on their own two feet.

(CROSSTALK)

WOODRUFF: We need to give Maria a chance here.

ECHAVESTE: What I would just simply say is, this Republican administration is going to be put to the test. On the Enron scandal, this administration was very quiet, was not in favor of stricter accountability. Harvey Pitt has been described as the lapdog -- he's the head of the SEC -- as opposed to the watchdog, which is what we need.

So, in light of WorldCom and everything that's happening, we need to have the Bush administration show that they are for the little people, the small investor, the pensioners. To date, they have not shown themselves to be that.

(CROSSTALK)

WOODRUFF: We're going to leave to there. Maria Echaveste, Deroy Murdock, sorry. We're going to have to leave it there. But we'll hope to see you both again very soon.

MURDOCK: Thank you.

WOODRUFF: Thanks very much.

ECHAVESTE: Thank you.

WOODRUFF: Coming up next: more on Al Gore's latest political moves. We will get the "Inside Buzz" from a reporter who covered his weekend meeting in Memphis and from our own Bob Novak.

(COMMERCIAL BREAK)

WOODRUFF: Here now with some "Inside Buzz": our Bob Novak.

All right, Bob, first of all, what are you hearing about J.C. Watts' decision, what's really behind this decision not to run again?

ROBERT NOVAK, CNN POLITICAL ANALYST: Well, I think he just -- he has not liked the job for a long time. You shouldn't do jobs that you don't like.

And it is OK for somebody not to make a career of it. The reason that the White House and the vice president were so upset about him not going is not that they are afraid of losing the district. That district carried 60 percent by President Bush and Watts won it easily. I think the Republicans have a good shot at keeping it. It's just that he is an African-American, the only African-American in the House.

There is no prospect for any further African-American coming in. Republicans cannot win majority black districts. They can only win in kind of fluky situations. J.C. Watts' district is 97 percent white. So, the only hope they have is if the front-runner to replace him as head of the conference is a woman -- woman in the leadership, Deborah Pryce of Ohio.

WOODRUFF: Let me ask you about reaction, Democratic reaction to Al Gore's comments about Bush over weekend.

NOVAK: You know, he came over much, much more anti-Bush than the other candidates. But the Democrats I talk to feel he has do that. He is not going to do it on his sex appeal in the Democratic Party. Gore has to really come over as anti-Bush.

What bothered some people that I talked to is that he said, "I apologize for how I ran the campaign, but the decisions were made by the consultants." Probably bashing the consultants goes over well with the public, but inside the Democratic Party, that was considered a little bit of a cheap shot.

WOODRUFF: Finally, SEC Chair, Securities and Exchange Commission Chair Harvey Pitt becoming the fall guy here?

NOVAK: I understand he is taking a long Fourth of July weekend. And he probably needs it, because he is going to get the stuff thrown at him.

Some Republicans are a little happy about that because it deflects the blame from the White House, from the president. Poor Harvey, it looks like he is going to be the scapegoat for the accounting scandals. So, he better tighten his seat belt and hook up his socks, because it is going to be a rough ride. I hope he enjoys the Fourth of July holiday.

WOODRUFF: Not to mention his suspenders. I don't know if he wears them.

(LAUGHTER)

WOODRUFF: But, all right, Bob Novak, thanks very much.

Well, for a little more "Buzz," "Inside Buzz" on Al Gore, we are joined now Jeff Zeleny. He is the Washington correspondent for "The Chicago Tribune." He covered Gore's political get-together in Memphis over the weekend.

Jeff Zeleny, after listening to Al Gore, how much closer do you think he is to a decision to run?

JEFF ZELENY, "CHICAGO TRIBUNE": Well, Judy, he was inching closer and closer almost by the hour in Memphis. He held a private retreat that was no quite so private. They invited a lot of reporters in to ask his closest friends and supporters what he had to said. And he virtually walked up right to the line, but said he will not cross that line until January at the earliest.

WOODRUFF: It sounds like some of the quotes that came out of this meeting, that he was criticizing his own staff, his own consultants, the kinds of things that Bob Novak was just referring to. Did the people around him think this is a smart thing to do?

ZELENY: I think the people around him were thrilled. If they wouldn't have been, they wouldn't not have been there. These were 60 of the closest supporters of the former vice president. And anything he said I think would have turned them on.

But, specifically, he was also acknowledging some of the blame for himself. He said he didn't follow his own instincts. He basically said he should have known better. He has been in plenty of campaigns. So, everything he said was received well by his supporters.

WOODRUFF: Are these people going to be with him if he decides to run? Did you have a chance to talk to many of the people who came, these donors?

ZELENY: Absolutely. We interviewed several of the donors. And all of them, to a person, all 60 of them, practically, said that they are with him, they support him, and they want him to run again. And if they hadn't been, those people were attending a retreat of a rival, Senator John Edwards, in Georgia the same weekend. So, all of the people in Memphis were through-and-through Al Gore supporters.

WOODRUFF: We know that Al Gore, for the first time, said specifically he is going to make a decision one way or another by the 1st of next year. How significant is that seen by the people who are watching this?

ZELENY: I think the timing is very significant. Most people were hoping he would have made some type of an announcement by the end of fall election term, by November. But he said the 1st of next year.

Specifically, it's important to Senator Joe Lieberman, who has been sort of waiting in the wings, deciding what his former nominee is going to do. But if he makes his decision early January, that is plenty of time to get these things going.

WOODRUFF: Jeff, you had both Tipper Gore and their daughter Karenna Gore saying they would love to see Al Gore run again. You had Karenna Gore saying -- it makes you -- I think her quote was sick at your heart to think what her father could be doing if he were president. Did you have the sense that some of this was orchestrated or what?

(PHONE RINGING)

ZELENY: The retreat was closed to the press. And they made very specific references, saying that it was not open. But several reporters like myself had no problem getting the news out of this. There were several aides to the campaign and aides to the vice president who were more than happy to recount exactly everything that went on in the meeting. So, it was not difficult at all. There were several family members around and there were several former supporters who were more than happy to share the new transformation by Al Gore.

WOODRUFF: All right, Jeff Zeleny, "Chicago Tribune," thanks very much for being with us.

That noise you were hearing was Bob Novak's three or four cell phones. They all went off at once. This is a man who is following the news.

Thank you, Jeff. And thank you, Bob, once again.

Checking the headlines now in our "Campaign News Daily": Political activist Jane Fonda put her money behind North Carolina Senate candidate Erskine Bowles, but Bowles has decided that he can do without her help. Federal records show Fonda gave Bowles $500 for his Democratic campaign to take on Republican Elizabeth Dole. But Bowles returned the check about a month later. A Bowles spokesman says the campaign was -- quote -- "not comfortable accepting the contribution."

The Iowa Senate race between Democratic incumbent Tom Harkin and Republican Greg Ganske appears to be tightening. Harkin holds a nine- point lead in a new poll of likely voters. Back in December, Harkin led Ganske by 23 points in a hypothetical head-to-head matchup.

Georgia Democrat Max Cleland has picked up a cool endorsement. The Orange & Scarlett's ice cream shop in Atlanta plans to name a new flavor for Cleland. The flavor: Max madness. The shop has created special flavors for other Georgia Democrats as well. I wonder who did that drawing. We'll find out.

Straight ahead: Postage rates are up again. Does the post office need a real competitor?

(BEGIN VIDEO CLIP)

MORTON: Competition? That would be a great way to get out of paying your bills: "Gee whiz, you didn't get my check? We must be using different carriers."

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WOODRUFF: Our Bruce Morton on why it costs so much to pay your bills.

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WOODRUFF: As you probably know, first-class postage rates have risen another 3 cents.

Our Bruce Morton thinks the cost of mailing a letter has climbed high enough, thank you.

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MORTON: Did you notice? Did you notice they have done it again? While you were sipping coffee or surfing the Internet or whatever, your friendly neighborhood Postal Service has gone and raised the rate on first-class mail. A letter was 34 cents. Now it's 37, an increase of 3 cents, just under 10 percent. Not only that, but when I went to the post office last week to get stamps to pay my bills with, they tried to sell me the new expensive ones. The 34s were, of course, still good. I would call that postal greed.

So, there they go again. The Postal Service seems to raise it rates a lot. You could argue that they have got some new competition nowadays. Many of us e-mail our friends instead of writing letters. Some of us pay our bills on the Internet. And there's FedEx and UPS and all that.

Still, there's a Web site called PostalFacts.com run by some organizations that use the mail, the American Bankers Association, the National Consumers League, the Newspaper Association of America, among others. And they argue that high-tech is not the problem. Postal volume, they say, didn't go down when e-mail came along. It went down only after the anthrax scare of 2001 and seems now to be going back up.

The problem, they say, is simply bad management. And they want the president to appoint a special commission to take a hard look at the post office, figure out what it ought to be doing and how it ought to do it. Deregulation, they say, is not the answer, because the Postal Service is a monopoly. And unregulated monopolies tend to be mean to their consumers. Remember the old Lily Tomlin line when she was a phone operator: "We don't care. We don't have to. We're the phone company"?

Competition? That would be a great way to get out of paying your bills: "Gee whiz, you didn't get my check? We must be using different carriers." No, in fact what will probably happen is, we'll just keep grumbling for six weeks or so. Then we'll get quiet and forget about it. And, in six months or a year and a year and a half, they will raise the rates again.

Paying your bills is hard. The people who take the water bills in are just next door to the CNN bureau here. I could hand-carry that one. Credit cards are harder. They tend to hang out in Delaware. I suppose you could Amtrak your way to Wilmington, but they are talking about closing Amtrak. Even if you have the money nowadays, paying your bills can be tough.

Bruce Morton, CNN, Washington.

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WOODRUFF: Where would we be without Bruce?

Well, are politicians good tippers? Up next, we'll ask a man who styles the hair of several top public figures.

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WOODRUFF: And now we hear from a man who puts style over substance in his dealings with some of the biggest names in American politics.

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WOODRUFF: We're here talking with Ian McWilliams of Bravado Hair Design in Washington.

Thank you for talking with us.

IAN MCWILLIAMS, BRAVADO HAIR DESIGN: Pleasure.

WOODRUFF: Now, you do the hair of some political figures. Tell us some of the people you have worked with.

MCWILLIAMS: Well, it's kind of strange talking about that, because, normally, I am rather discreet, which is funny having this interview with you.

But it all started off in 1990 with Al Gore. And then he referred me to President Clinton. And from there, just word of mouth, the way we build the business, other names have come through the salon.

WOODRUFF: Who were some of the others?

MCWILLIAMS: Senator Daschle, John Edwards, and Senator Evan Bayh, and a couple of other people as well. But these are the ones who have been in print before, so I can feel comfortable mentioning their names.

WOODRUFF: Now, you have named only Democrats. Does that mean you don't do Republicans?

MCWILLIAMS: No, I did Republicans. I came here during Reagan- Bush. And I still have those clients coming in. But it just seems to be the high -- the other side of the fence is who are coming into the shop, the more high-profilers.

WOODRUFF: Is there something different about doing a politician's hair than doing somebody's hair?

MCWILLIAMS: Not really. They are -- they just want to have a good, quality-cut appearance. The only difference they do is, I try and advise them to have a hair cut on a regular basis, so it doesn't look as though it is needing to be cut -- but nothing much else. We will work with the base foundation of how their face is and what hair quality and stuff like that.

WOODRUFF: Now, what about this idea of there are hairstyles that are avant-garde, if you will? Do you have to be careful not to be too sort of with it with the style?

MCWILLIAMS: Yes, I would probably say I am not really an avant- garde hair stylist. Mostly, I am somewhat conservative in that action, but just getting a good look that really matches what they want, because we deal with all kind of professional people here. So, we can go from artists to stay-at-home moms to politicians and all sorts. So, it is a real nice cross-section that we have on Capitol Hill.

WOODRUFF: Now, if you had to describe what it is like to cut, say, Al Gore's hair -- I don't know if you are still cutting his hair or not.

MCWILLIAMS: Yes, I am.

WOODRUFF: But what did you think when he grew his beard? Did you...

MCWILLIAMS: Well, that was nothing new to me. And, whenever -- even when he was in the White House, he would always go away on vacation. And as soon he came back, he always had a beard. He just didn't want to deal with having to shave every single day. So, I didn't seeing anything wrong with that. It's just that the media kind of took a big story on it, which was a shame, really, because it was just being himself, as he always is.

WOODRUFF: Did you give him any advice about it one way or another?

MCWILLIAMS: On the beard? Yes, we trimmed it a little bit, shaped it up. That's my job.

WOODRUFF: Do politician talk politics when they are here or do they -- what?

MCWILLIAMS: Sometimes. But I try and make this an oasis for them to get away from it all. So, I will talk about what movies they have seen or travels they've been on -- which, of course, they are all over the place -- but just kind of ease away from the politics and just let them relax a little bit while they're in the chair.

WOODRUFF: What are your politics?

MCWILLIAMS: I don't have any. I can't even vote in this country.

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MCWILLIAMS: So I just -- I think that might be another nice thing, is that I am very neutral.

WOODRUFF: Are they all good tippers?

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MCWILLIAMS: Tipper is a wonderful lady. She really is very nice.

(LAUGHTER) WOODRUFF: Sounds like you are avoiding -- ducking the question.

MCWILLIAMS: I have never discussed it with anybody. Even my mother can ask that question, and I haven't even told her.

WOODRUFF: A favorite among all of them?

MCWILLIAMS: All of them? They're all great. I suppose my heart goes out to Al Gore. He was my first. And I think we have developed into a nice friendship.

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WOODRUFF: Ian McWilliams did tell me, share with me that a prominent former politician used to let his hair get too long, didn't come in often enough for haircuts, but I'm not at liberty to give you that person's name.

I'll be back in a moment, but now let's take a look at what is coming up on "WOLF BLITZER REPORTS" -- hello there, Wolf.

WOLF BLITZER, "WOLF BLITZER REPORTS": Hi, Judy.

A U.S. bomb goes astray in Afghanistan, with deadly consequences. We'll take you there live. And a disturbing report about airport screeners: You will want to see how they are doing at some of the nation's major airports. And a mysterious letter from Osama bin Laden may -- repeat, may -- hold a clue to his fate.

All that coming up at the top of the hour, right after INSIDE POLITICS.

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WOODRUFF: That's it for INSIDE POLITICS. "WOLF BLITZER REPORTS" is next. Thanks for joining us. I'm Judy Woodruff.

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