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Inside Politics

The Kerry Bandwagon; Dean's Dilemma in Wisconsin

Aired February 06, 2004 - 15:30   ET

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

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


(BEGIN VIDEOTAPE)
REP. RICHARD GEPHARDT (D-MO), FMR. PRESIDENTIAL CANDIDATE: And I'm proud to endorse him to be the president of the United States of America.

ANNOUNCER: Closing ranks. Ex-candidate Dick Gephardt hops on the John Kerry bandwagon.

SEN. JOHN KERRY (D-MA), PRESIDENTIAL CANDIDATE: Dick, you may think that you and Jane have earned yourselves a vacation, but we've got a lot of work for you to do.

HOWARD DEAN (D), PRESIDENTIAL CANDIDATE: I think it was a brilliant ploy, and I certainly stand by it.

ANNOUNCER: Do the polls bear him out? We'll have the latest on Howard Dean's Wisconsin or bust strategy.

The president gets ready for a grilling. What's behind his decision to do a Sunday talk show?

(END VIDEOTAPE)

JUDY WOODRUFF, HOST: Thank you for joining us.

Well, the power of endorsements has been debated and debated in this presidential campaign. Just ask Howard Dean and Al Gore. But Dick Gephardt's embrace today of former rival John Kerry provides at the very least a timely image of Democrats coming together. Not to mention the labor support that Gephardt brings to the table in places like Michigan, where the big announcement was made.

CNN's Kelly Wallace joins us from Flint, Michigan -- Kelly.

KELLY WALLACE, CNN NATIONAL CORRESPONDENT: Judy, what Dick Gephardt does, just as you were noting, is gives John Kerry immediate clout with industrial union workers, especially in a state like Michigan, which lost 170,000 manufacturing jobs in three years, according to the state's governor. Many union workers have been somewhat concerned about John Kerry's record, especially his support in the past of trade deals, including the one linking the United States, Mexico and Canada.

And so the choice and the setting for this endorsement no coincidence. The very union town of Warren, Michigan, and there Dick Gephardt said, of all the Democratic presidential candidates he believes John Kerry is the best qualified to win in November.

(BEGIN VIDEO CLIP)

GEPHARDT: That leader is John Kerry, and I'm proud to endorse him to be the president of the United States of America.

(END VIDEO CLIP)

WALLACE: And CNN has learned that Dick Gephardt convened a conference call on Wednesday with the labor presidents who were supporting him, urging them to back John Kerry, and that some of these presidents met with John Kerry yesterday in Boston. No word yet, though, of any endorsement, although others could come, we are told, next week.

There is one tough question, though, for Dick Gephardt. He made opposition to the North American Free Trade Agreement, the centerpiece of his presidential campaign, and this is a trade deal that John Kerry supported. He was asked about that during a news conference with reporters, and he says he believes that John Kerry now believes in the future. Trade deals need to include labor and environmental standards, and he says that is a position much closer to his own -- Judy.

WOODRUFF: And, in fact, that's one of the things I asked Dick Gephardt about. We're going to be running that interview in just a few minutes.

Kelly, separately, what is the Kerry camp saying about this report -- Associated Press Report today -- that he gave -- in return for recommending people for federal positions on federal commissions, he received political contributions?

WALLACE: Right. This report saying that there were three times where just before or right after he nominated people to federal positions he received political donations. Well, the campaign is responding very, very aggressively, saying there is really no "there" there to this story.

Stephanie Cutter (ph), the senator's press secretary, saying that these were all people who were in high standing, big-time supporters of John Kerry. That they were professionals, and that they are deserving of these posts. That there was no connection at all, entirely coincidental to these political donations. Well, some of the senator's own rivals, including Wesley Clark, are coming out with statements of their own.

Wesley Clark commenting about this report and others this week, saying that John Kerry is really representing inside Washington, putting, in his words, political interests ahead of national interests. The Kerry campaign responding very aggressively. Again Stephanie Cutter (ph), the president's press secretary, saying that Wesley Clark earned more than $1.6 million as a lobbyist last year. So she's pointing fingers at him, saying if he wants to change the way Washington works, then he should look at his own career choices, as well -- Judy. WOODRUFF: All right. Kelly Wallace following the Kerry campaign today. Thank you very much, Kelly.

And picking up on that comment Kelly made, one of the questions is, were the disagreements between John Kerry and Dick Gephardt -- did they make it any harder for Gephardt to go ahead and endorse the Senator? Well, that's one of the things I asked Dick Gephardt. And we'll be running that interview in just a few minutes.

Now we go to Howard Dean's New home away from home, Wisconsin. The latest Wisconsin poll suggests that Dean's must-win focus on that state's February 17 primary is going to be an uphill battle. It shows John Kerry far and away the leader in Wisconsin, with Dean a distant fourth place. Now, this poll was taken before Kerry's wins this past Tuesday.

CNN's Joe Johns is with Howard Dean in Wisconsin. He's on the telephone with us now from Milwaukee.

Joe, in essence, how is Howard Dean's Wisconsin strategy going?

JOE JOHNS, CNN CORRESPONDENT: Well, Judy, Dean has apparently raised a lot of money to fight for Wisconsin, according to his campaign. In their do-or-die e-mail, the one they sent out yesterday asking for $700,000, we've got to win Wisconsin, in fact, the paper advertising, as of early this afternoon, today, they said they had raised about $900,000. We have obviously no way of independently confirming that, but they say it gave them a jump-start.

Now in the campaign events this morning, Dean went to a coffee shop, shaking hands with people, pressing individual voters. Last night he hit the telephones. So the campaign is clearly trying to create moments for this candidate in front of the cameras where he's making a very direct appeal personally for their support.

Going forward, what they expect him to do is run biographical ads that will lay out Dean's resume and his record. We're being told there are no plans to go negative, because they think that's what hurt them in Iowa. But Dean did say last night at a news conference that he believes people have decided to vote for Senator Kerry without knowing anything about him, and he says he wants to contrast his, Dean's record, with Senator Kerry's -- Judy.

WOODRUFF: And he certainly has been doing that out on the campaign trail, even if he's not doing it in his ads. Joe, separately, this so-called Wisconsin strategy became public in an e- mail that the Dean people sent to their supporters. Dean called it a brilliant ploy last night. Any follow-up on that?

JOHNS: Well, the follow-up really is that it was another one of those unusual choices of words that has gotten him in trouble before. He got a number of questions on that, what did he mean by that. The campaign continues to get questions. Of course, his point is when he used the word "ploy" he was talking about a strategy.

On the other hand, there were some other things that stuck out, you know? He has portrayed himself as a very plain-spoken candidate. A straight talker, if you will. But when he was asked, if you lose here in Wisconsin, what happens, his answer was anything but direct. He said I'm kind of avoiding that question by just saying we're going to win. So it's really an issue of choice of words -- Judy.

WOODRUFF: It's one of those questions candidates have a hard time asking directly almost under any circumstances. All right. Joe Johns, thank you very much.

Well, John Edwards appears to be trying to lower expectations for his performance in Tuesday's primaries in Virginia and Tennessee. Even as he continues to campaign hard in those states, Edwards says he does not believe he has to win there, just finish in the top two. We'll get a report from the trail on Edwards' strategy a little bit later.

Over at the White House today, President Bush named seven members to a bipartisan commission to review U.S. intelligence, including information used to justify the war in Iraq.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: The commission will compare what the Iraq Survey Group learns with the information we had prior to Operation Iraqi Freedom. It will review our intelligence on weapons programs in countries such as North Korea and Iran. It will examine our intelligence on the threats posed by Libya and Afghanistan before recent changes in those countries. Members of the commission will issue their report by March 31, 2005.

(END VIDEO CLIP)

WOODRUFF: Let's bring in our senior White House correspondent, John King, to talk more about this panel, and the politics around it -- John.

JOHN KING, CNN SR. WHITE HOUSE CORRESPONDENT: Judy, the politics quite fascinating. We are obviously in the middle of a re-election year here. This report from this commission not due until next year in March, well after the election. But the president knows this commission is being criticized already by the Democrats.

That is one of the reasons he put three Democrats on this commission. We are told at least one more to come. They're trying to recruit a Democratic member of Congress. And according, at least to Democratic sources, having some difficulty doing that.

But the president had as the co-chair former Senator Chuck Robb. Also the former governor of Virginia. A Democrat, an ex Marine.

The president also tapping former federal judge Patricia Wald. She is another Democratic appointee considered by Bill Clinton for the Supreme Court during his administration on this panel. And in the middle here, Lloyd Cutler, White House counsel to presidents Clinton and Carter. Three Democrats viewed by both Democrats and Republicans as officials of character and integrity. The president hoping that by naming three Democrats like this, and again at least one more to come, he would quiet those who say there is no way a commission solely appointed by the president can, in fact, be independent. Well, the president might hope that argument takes hold out in the country, Judy. It is not taking hold in Washington, at least initially.

Nancy Pelosi, the House Democratic leader, saying this is a commission wholly owned by the president, wholly owned by the White House, and cannot be truly independent. So the initial Democratic reaction is to ignore the Democratic members and to simply say this panel cannot be independent. But again, the White House political calculation, Judy, is that out in the country they will look at these senior Democrats on the commission, and think OK, let's give this a chance.

WOODRUFF: Presumably that gives it -- gives whatever the outcome is more credibility. All right. John King, thank you very much, at the White House.

Another political flashpoint for the Bush camp, and that is jobs. Still ahead, is the president satisfied with the latest unemployment numbers? We'll talk to Bush labor secretary Elaine Chao.

Plus, a scene-setter for Tuesday's Virginia primary. Governor Mark Warner will share his take on the Democratic presidential race and how his state figures in.

And John Kerry rocks on, circa 1961.

This is INSIDE POLITICS, the place for campaign news.

(COMMERCIAL BREAK)

WOODRUFF: A picture of the capitol on this icy cold day in Washington.

Well, the state of Virginia next door holds its Democratic presidential primary next Tuesday. While Both of its U.S. senators are Republicans, Virginia's governor is a Democrat. Just about an hour ago, I asked Governor Mark Warner when he intends to follow the lead of some other governors who have endorsed John Kerry before contests in their states.

(INSERT WARNER)

WOODRUFF: Virginia Governor Mark Warner talking to us just a short time ago.

President Bush has kept his distance from the Sunday talk shows. But all that changes this weekend. Howard Kurtz previews the president's Sunday sit-down and asks the question, "Why now?"

Also, why is Al Sharpton all alone? The presidential hopeful makes the most of his time at center stage.

(COMMERCIAL BREAK)

WOODRUFF: Want to share with you some comments President Bush made just a short time ago at the National Targeting Center here near Washington, which gives targeting expertise to homeland security in the war on terror. Here's part of what the president said.

(BEGIN VIDEO CLIP)

BUSH: Our government and many of the employees are really working hard. And here I've learned -- I've seen how we're able to make information with terrorists lists or information with potentially dangerous cargo so we can spread valuable information throughout the country at ports of entry or border crossings. And it's a fascinating place.

It's a place where, after 9/11, we -- it grew, and it grew with getting the very best programs, programmers and computers to keep us better protected now. I really want to thank the people here.

On another front I'm pleased, obviously, with the new job growth. I've been saying that this economy looks pretty strong. And today, 112,000 new jobs were created last month. A reported 112,000 new jobs were created last month. And that's good.

Things are getting better. There is more to do. But this economy is growing in strength, and I'm obviously pleased with that.

Thank you all for coming. Thank you.

(END VIDEO CLIP)

WOODRUFF: President Bush, some comments he made just a short time ago at the National Targeting Center. For those of you not familiar, it's an organization that provides targeting information to the Department of Homeland Security to support the timely and accurate flow of information pertaining to national security and terrorist activity.

We'll be right back.

(COMMERCIAL BREAK)

WOODRUFF: President Bush has agreed to a rare news interview this weekend with one of the Sunday morning talk shows. Media critic Howard Kurtz of CNN's "RELIABLE SOURCES" has more on the president's decision to step out of his media comfort zone.

(BEGIN VIDEOTAPE)

HOWARD KURTZ, CNN "RELIABLE SOURCES" (voice-over): When it comes to television sit-downs, President Bush likes softer settings. The most important appearance of his 2000 campaign was probably when he and Laura Bush shot the breeze with Oprah Winfrey, who got a kiss on the cheek.

And while the president in the past 18 months has granted interviews to the likes of CBS' Scott Pelly (ph) Fox's Brit Hume, he may have been most at ease with ABC's Barbara Walters and Diane Sawyer.

So what explains Bush's decision nine months before the election to face a sustained inquisition by Tim Russert on this Sunday's "Meet the Press?" The president has been taking a pounding from the Democratic candidates. He's been hurt by the WMD report of former weapons inspector David Kay. And polls show him losing to John Kerry. What better way to get back in the game than by showing he can hit big league pitching on the top-rated Sunday show?

Richard Nixon once did a brief cameo an "Laugh-In." But the real talk show pioneer was Bill Clinton. He famously played the sax on Arsenio Hall in '92, and as president, schmoozed with Larry King and fielded a somewhat intimate question on MTV.

WILLIAM JEFFERSON CLINTON, FMR. PRESIDENT OF THE UNITED STATES: Usually briefs.

KURTZ: The preferred venues have gotten softer and funnier over the years. Al Gore tried to lighten up his wooden image by yucking it up with David Letterman. Arnold Schwarzenegger stunned the world by throwing his hat in the California ring, and joking about his bikini wax, with his pal Jay Leno. John Edwards, who just this week did a drop-by on Letterman's "Late Show," actually announced his White House bid on Comedy Central's "Daily Show."

JON STEWART, "THE DAILY SHOW": Do you have plans to announce it in another, let's say more -- what's the word I'm looking for -- professional environment?

SEN. JOHN EDWARDS (D-NC), PRESIDENTIAL CANIDIDATE: No. I'm counting on you.

STEWART: What?

KURTZ: Howard Dean tried to recover from his infamous Iowa scream with this "Top 10" list on "Letterman"...

DEAN: Oh, I don't know, maybe fewer crazy red-faced rants?

KURTZ: Dean also chatted up Diane Sawyer with his rarely seen wife, Judy. And Al Sharpton hosted "Saturday Night Live," not that it did his campaign a whole lot of good.

(on camera): Insiders call it the "Russert primary," these hour- long examinations on "Meet the Press." And both Dean and Edwards stumbled when their performances were panned last year.

The stakes may be considerably higher for an incumbent president if Russert is as aggressive as he has been with the Democratic candidates. But there are a lot of talk shows out there. So don't rule out a return presidential appearance on "Oprah."

This is Howard Kurtz, of CNN's "RELIABLE SOURCES."

(END VIDEOTAPE)

WOODRUFF: So if the president does well, will it improve his poll ratings? We'll see.

Checking the headlines now in our "Campaign News Daily," only Al Sharpton bothered to show up at a forum sponsored by the NAACP in Detroit last night. Sharpton took the stage with three empty chairs and made the most of his chance to address the crowd alone. John Kerry, Wesley Clark and, with just hours to spare, Howard Dean, all canceled plans to appear at the event.

The Pentagon has scrapped a plan that would have allowed military service members and their families overseas to vote over the Internet. Defense Department officials made the decision two weeks after an outside study questioned the security of a new online voting system.

Former Senator Robert Torricelli is raising campaign cash for John Kerry. Torricelli tells politicsnewjersey.com he has personally helped to collect almost $100,000 for the Kerry campaign. We'd like to know what the senator's campaign has to say about that.

Senator Kerry's past life in a garage band has resurfaced. And his group's one album is now available on eBay. Kerry played bass for the Electras while he attended St. Paul's School in Concord, New Hampshire. The last-check bidding for a copy of the album recorded in 1961 has climbed above $500. Kerry's been known to play a little guitar on the campaign trail, but the "Boston Herald" reports the other former band members are now Republicans.

Our exit polling in this year's primaries shows that voters are very worried about the U.S. economy. Coming up, I'll ask Labor Secretary Elaine Chao about the latest news on unemployment and job creation.

And later, a rare public appearance by former first lady Nancy Reagan, marking her husband's 93rd birthday, which is today.

(COMMERCIAL BREAK)

(BEGIN VIDEOTAPE)

ANNOUNCER: They don't always see eye to eye. So why is Dick Gephardt backing Democratic front-runner John Kerry? Judy speaks with the former presidential hopeful.

The expectations game. Is John Edwards lowering his?

EDWARDS: I think in Tennessee and Virginia I have to be competitive, which I think means in the top two.

ANNOUNCER: You've seen the highlights, but we've got some of the lighter moments from the campaign trail this week.

DEAN: We're going to keep going and going and going and going and going, just like the Energizer bunny.

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

(END VIDEOTAPE)

WOODRUFF: Welcome back. On the eve of the Michigan caucuses, John Kerry seems as well-positioned as ever in a state with its hefty prize of 128 delegates. The latest Michigan poll shows Kerry with 52 percent support. No one else even comes close. On top of that, Kerry now has former rival Dick Gephardt in his corner. A potential drawing card for support by unions that are so influential in Michigan and elsewhere. After Gephardt announced the endorsement in Michigan today, I spoke with him and started by asking him if it was hard to get behind somebody else's candidacy?

(BEGIN VIDEOTAPE)

REP. RICHARD GEPHARDT (D), MISSOURI: No, it really wasn't. I said from the beginning of this campaign that the campaign is not about me, it's not about any of the other candidates. It's really about the future of the country. The future of education, jobs, health care. That's why I ran. And it never was about me. So I want us to win. And this is the most important election of my lifetime. And I'm going to do everything I can in my power to help us win this election. And I think with John Kerry we have a candidate that we can win with. He's got the ability and the qualifications to do this job. And that's what people are going to look for in November of next year -- of this year.

WOODRUFF: You mention jobs. But you said less than a month ago in Iowa and I'm quoting you, you said I don't think we can beat George Bush if we maintain a position on trade like George Bush. And you went on to say John Kerry has shared the same position that George Bush has on NAFTA and on China. Have you changed your mind?

GEPHARDT: Well, the good news is that during this whole election period, and in all the debates we had, I found a growing agreement among all the candidates, and certainly including John Kerry, on the question of trade. Even though we had had disagreements on NAFTA and on the China agreement, which I brought out in the campaign, I think John has come to an understanding that we've got to have labor and environmental conditions in the context of any treaties that are done. And we need to try to get that into the NAFTA agreement and into the China agreement. And I'm satisfied that John will lead toward that conclusion. I really feel good about the success that I've had in bringing this issue to the table in this campaign.

WOODRUFF: John Kerry does not agree with you about the need to roll back President Bush's tax cuts for the middle class. That doesn't bother you?

GEPHARDT: Well, again, I think we have a lot of essential agreement. We didn't agree exactly on how much of the tax cut should go away. How much the health care plan should be. But he is willing to roll back the parts that went to the wealthiest and that was 50 or 60 percent of the tax cut. And all during the last year, I maintained that I would try to hold onto the marriage penalty and the child care credit, and I do that through closing loop holes in other places for corporations. So I think we can find essential agreement on that issue.

WOODRUFF: Should President Bush's alleged absence from National Guard duty back in the '70s be any issue -- be an issue at all in this campaign?

GEPHARDT: Well, I think all of us always face scrutiny about how we conducted ourselves before we got into public life, and obviously during public life. John Kerry's record of military service is there for everybody to see. He has a distinguished record. He fought heroically for the United States in Vietnam. And did it on repeated occasions. So I think, you know, voters will look at that record. And they will look at the difference in how people served, and that's as it should be.

WOODRUFF: Yes or no, are you interested in being vice president?

GEPHARDT: That's really not a question that should be even entertained today. We've got a big job ahead of us. We've got to get John Kerry to win this nomination. Our other candidates are great candidates. This is still going to be a hard-fought contest. And then we've got to prepare to win in the fall. That's what I'm interested in. And not anything else.

(END VIDEOTAPE)

WOODRUFF: Dick Gephardt talking to me just an hour ago.

John Edwards today called Dick Gephardt a, quote, "wonderful man." But suggested his endorsement of John Kerry wouldn't sway voters much. Today Edwards is campaigning in Virginia and Tennessee, while downplaying his prospects in Tuesday's primaries. CNN's Phil Hirschkorn is with Edwards in Tennessee.

(BEGIN VIDEOTAPE)

PHIL HIRSCHKORN, CNN CORRESPONDENT (voice-over): John Edwards is campaigning by bus in Virginia and Tennessee, but the North Carolina senator says he doesn't have to win those primaries next Tuesday, though they're in his backyard. Edwards and his senior staff telling us they'll be satisfied if Edwards finishes in the top two, and if they had another week on the ground Edwards might overcome John Kerry's momentum. Edwards tells us he sees the nomination process as a war of attrition, and that he will be one of the last two men standing perhaps after a final four showdown in Wisconsin.

Wesley Clark is his immediate obstacle, especially in Tennessee. This campaign believes a lot of Clark voters would support Edwards if the general were not in the race. Meantime Edwards is fine-tuning his stump speech to talk more about trade and jobs and today's unemployment numbers.

SEN. JOHN EDWARDS (D-NC), PRESIDENTIAL CANDIDATE: You know, providing for American security also means providing for securing American jobs.

HIRSCHKORN: Edwards' senior staff tells us they believe that Kerry's momentum is built on the fallacy that the Massachusetts senator is more electable. Campaign pollster Harrison Hickman says exit polls in the early primaries show that people who make a Democrat electable, independents, moderates and cross-over Republicans prefer Edwards. For example Edwards won more support from Republicans than Kerry did in the battleground state of Missouri, and more moderates in Missouri, Arizona and New Hampshire.

And in Oklahoma, though Edwards lost by less than one percent to Clark, Edwards won more counties carried by President Bush in the 2000 election. The campaign's message, Edwards is electable in November, and they'd be able to prove it in a one-on-one matchup with anyone. Phil Hirschkorn, CNN, Bristol, Tennessee.

(END VIDEOTAPE)

WOODRUFF: Howard Dean suggested today that he would consider the No. 2 spot on the Democratic ticket if it would help defeat President Bush. But Dean told a Wisconsin radio interviewer that he still is planning on winning the nomination himself. Despite his winless streak this primary season. Dean has indicated that Wisconsin's primary February 17th could be his last stand. Meantime Wesley Clark is stepping up his attacks on his rivals. In Tennessee today he accused John Edwards of voting against programs to help the nation's veterans. The Edwards camp in turn accused Clark of dipping into the gutter and throwing whatever he can find.

The '04 Democrats kept up their criticism today of President Bush's economic policy citing a mixed jobs report. The unemployment rate fell a tenth of a percentage point in January to 5.6 percent. That is the lowest level in two years. 112,000 new jobs created last month. But a weaker gain than 150,000 jobs that many economists had predicted.

We are joined now by the Secretary of Labor, Elaine Chao.

Thank you very much for being with us.

ELAINE CHAO, SECRETARY OF LABOR: Nice to be with you.

WOODRUFF: Madam Secretary, what about this notion that, yes, it's good news, there were 110,000 jobs created, but it's not the rate needed to get this economy moving the way it needs to get moving?

CHAO: Well, I think today's news is good news in that the unemployment rate has dropped to 5.6 percent even as the labor pool participation rate increased. So what that meant was that more people enter the work force and, yet, the unemployment rate drops. So that's good news.

In addition, 122,000 new jobs have been created, as we saw in the employment survey. There's also another survey called a household survey which showed that 497,000 workers have found new jobs, as well.

So we have two surveys. While they differ in magnitude, they both show continued strength in the economy and continued strength also in job hirings. WOODRUFF: I want to cite the one economic analyst with Credit Suisse First Boston. He said, these are his words, quote, "very disappointing; we're not getting the jobs to replace the stimulus in the economy which will fade once the first quarter ends." Another economist said, "It's the weakest job-creation rate relative to economic growth on record."

CHAO: Well, the stock market is, after all, the final arbiter. And the stock market was very strong this morning in reaction to the news that we have just received.

Of course, we're not satisfied with the rate of job creation, although this is the fifth straight month in which job creation has occurred. So we want to implement the president's -- we hope that the Congress will implement the president's proposed six-point economic package. And the president has also put $500 million to help programs that will increase job hires for the 21st century workforce.

And we at the Department of Labor do a great deal with our programs to help people train for new jobs, because there are jobs available. And what our challenge is, is to help workers gain the training or the retraining to access these new jobs and job growth opportunities.

WOODRUFF: But, again, you get these comments, like from Morgan Stanley, market economists saying the level of job creation certainly disappointing for, what he said, the 26th month of the alleged economic recovery.

CHAO: Well, as I mentioned, the stock market reacted, and the stock market was very positive. So, of course, today's news is good news, but we're not satisfied, and we need to do more. And that's why, again, the president's six-point economic program, where he asks for making the tax reduction permanent, where we have tort reform, where we pass the energy program so that more employment can occur, and that we make health care more accessible and affordable to more Americans.

WOODRUFF: There was an Associated Press consumer confidence poll done this week that showed a drop in consumer confidence in January, the analysis saying the market is what's driving consumer confidence and spending down. How do you see that?

CHAO: I don't think that's correct. I think consumer confidence is up. I mean, overall our economy is doing very well. Inflation is at the lowest rate in well over 20 years. Interest rates are at an all-time low. Home refinancings have increased. New construction has increased.

WOODRUFF: So to the people who are still looking for work, is the message, "Be patient," or...

CHAO: Oh, no, of course not. We're very concerned about them. And we have a department that offers an array of programs to help people who are unemployed. We as a nation are very compassionate. We spend about $15 billion a year to help those who are unemployed with unemployment insurance benefits, with income support of all kind, as well as training programs. So we have a great deal to offer to workers who are unemployed and who are looking for new job opportunities. As I mentioned, the president offered $500 million more on top of that for job training.

WOODRUFF: We hear you loud and clear.

The Secretary of Labor, Elaine Chao.

Thank you very much for coming by.

CHAO: Thank you.

WOODRUFF: We appreciate it. Good to see you again.

Former President Ronald Reagan has a birthday today. He is 93 years old. Coming up, Nancy Reagan attends a special tribute to her husband.

Later, is winning five of seven primaries good enough to get the "Political Play of the Week"? Let's just say John Kerry is sure to be asked about the even Bill Schneider picked.

And who says running for president isn't anything to laugh about? Stay with us for some lighter moments from the campaign trial.

(COMMERCIAL BREAK)

WOODRUFF: Former President Ronald Reagan turned 93 today. Nancy Reagan greeted schoolchildren at the Reagan Presidential Library in California. They, in turn, sang "Happy Birthday" in her husband's honor.

The former first lady also unveiled a cornerstone for a pavilion that will house the Air Force One that was used by the Reagans.

When reporters asked how her husband's holding up, Mrs. Reagan said fine. The former president suffers from Alzheimer's disease.

INSIDE POLITICS will be right back.

(COMMERCIAL BREAK)

WOODRUFF: Bill Schneider's with me now for more on a volatile issue that made headlines once again this week and shows no signs of fading away any time soon -- Bill.

WILLIAM SCHNEIDER, CNN SENIOR POLITICAL ANALYST: Judy, as you know, a whole new controversy burst upon the political scene this week. How did it get there? Through the "Political Play of the Week."

(BEGIN VIDEOTAPE) MATT DANIELS, PRES., ALLIANCE FOR MARRIAGE: No one had any real question about the result in Massachusetts. And this means now that the battle's moving national.

SCHNEIDER (voice-over): The battle is over gay marriage. after the Massachusetts Supreme Judicial Court this week informed the state legislature that nothing short of full-fledged marriage for same-sex couples would meet the requirements of the state constitution.

The 4-3 decision is creating a political uproar in Massachusetts. It's forcing politicians everywhere to deal with the divisive issue they want to stay as far away from as possible. Like, say John Kerry, who's from Massachusetts.

KERRY: I personally believe the court is wrong.

SCHNEIDER: Now wait a minute. In 1996, President Clinton signed the defense of marriage act, which banned federal recognition of gay marriages. Kerry voted against it.

KERRY: I voted against gay bashing on the floor of the United States Senate.

SCHNEIDER: Meanwhile, President Bush is under pressure to back a constitutional amendment banning gay marriages.

BUSH: If judges insist on forcing their arbitrary will upon the people, the only alternative left to the people would be the constitutional process.

SCHNEIDER: At the risk of damaging his image as a compassionate conservative.

MARY BONAUTO, PLAINTIFF'S ATTORNEY: No matter how you feel about marriage, it's always going to be wrong to go out of your way to amend the Constitution to discriminate against one particular group of people.

SCHNEIDER: This week the curtain came up on a new act in the nation's long-playing culture wars. Right...

DANIELS: This is about redefining marriage for our entire nation against the will of the people.

SCHNEIDER: ... versus left.

EVAN WOLFSON, EXEC. DIRECTOR, FREEDOM TO MARRY: When the dust settles, people are going to see what the Massachusetts court said, that allowing marriage equality will help families, while hurting nobody.

SCHNEIDER: But the dust is not likely to settle any time soon. This is a "Political Play of the Week" with the potential for a very long run.

(END VIDEOTAPE) SCHNEIDER: And guess where the Democratic Convention's being held this summer? Massachusetts. And the Republican Convention is in New York, which has a large activist gay population. This issue is not likely to fade away soon.

WOODRUFF: Doesn't sound like it. All right. Bill Schneider and "The Play of the Week." Thanks very much.

Wesley Clark's strategy for a comeback victory. Up next, "Inside Buzz" from Bob Novak on what the retired general is telling his supporters in Congress.

(COMMERCIAL BREAK)

WOODRUFF: Bob Novak joins us now from the "CROSSFIRE" set at George Washington University with some "Inside Buzz."

All right, Bob, first of all, some insight into a recent Wesley Clark strategy session with a group of his supporters.

ROBERT NOVAK, CO-HOST, "CROSSFIRE": He called his -- after he won the Oklahoma primary, he called his supporters together on the Hill. And ten Congressmen who are endorsing him, who are supporting him, met in Congressman Charlie Rangel's office on the speakerphone to hear General Clark say that he had a very good shot of doing well in Tennessee and Virginia next week, one first, one second.

But what I found interesting is he has 21 members of Congress who have endorsed him, only ten showed up for this meeting. And conspicuous by his absence was Congressman Rahm Emmanuel, the hot-shot young congressman from Illinois, kind of a link to the Clintons. Congressman Emmanuel told me he had a scheduled hearing on the Financial Services Committee so he couldn't be there.

WOODRUFF: All right. Howard Dean and that famous labor support that he's had from the beginning. What are you hearing about that?

NOVAK: I hear they are very restive, very uneasy with his very poor showing. Only got eight delegates last Tuesday night. Particularly AFSCME. And he's stirring the SCIU, the service employee's union is keeping his troops together. but they really want to leave. He's desperate to keep them at least until the Wisconsin primary saying that is my last shot.

WOODRUFF: All right. Something back here in Washington, the Highway Bill. What are you hearing about that?

NOVAK: The Highway Bill. A lot of people are urging the president to veto that bill, even though he may be overridden, people inside the administration and outside the administration to show that he really cares about spending.

He has put a limit of $260 billion on that bill. The members of Congress are addicted to highway pork. Both the House and Senate bill are well over $300 billion. He would probably be overridden. But Reagan was overridden on that kind of a bill and it really strengthened his presidency.

WOODRUFF: And finally, Bob, way out to Washington state. Congresswoman Jennifer Dunn, a Republican, announcing she's not running for re-election. What are you hearing about that?

NOVAK: That suddenly makes that district, which was a safe district as long as she was running, a contested district. It's a suburban district in Washington that Al Gore beat Bush on very comfortably in the last election.

They have a self-financed dotcom multimillionaire named Alex Alden, who is the Democratic candidate. There is a contest between Sheriff Reichert out there and a former regular talk show host, John Carlson, for the Republican nomination.

So that is one seat that the Democrats didn't have a chance for that they have a chance for since Jennifer Dunn is not running.

WOODRUFF: We like the thought of former talk show host running.

NOVAK: Yes. Have you thought of that, Judy?

WOODRUFF: OK, all right. Bob Novak. We'll see you on "CROSSFIRE" coming up in about six minutes.

NOVAK: Thank you very much.

WOODRUFF: A look back at the week in politics.

(BEGIN VIDEO CLIP)

CLARK: I'm the toughest hombre in the race.

(END VIDEO CLIP)

WOODRUFF: Up next, the tough talk, the flying fish, and other highlights from the campaign trail.

(COMMERCIAL BREAK)

WOODRUFF: Time now for a look back at "The Week in Politics." The highlights and the lowlights from the campaign trail.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: Ladies and gentlemen, the president of the United States.

BUSH: And knowing what I know today America did the right thing in Iraq.

CLARK: Oklahoma is OK.

KERRY: It's great to see New Englanders go to Texas and win.

Like father, like son, one term and you're done. EDWARDS: And I'm going to beat George Bush in my backyard.

JON STEWART, HOST, "THE DAILY SHOW": Edwards added that George Bush must be defeated, because, quote, "When it's time to change you've got to rearrange."

EDWARDS: Read my lips, no new wardrobe malfunctions.

REV. AL SHARPTON (D), PRESIDENTIAL CANDIDATE: I know a man! I know a man!

REP. NORM HICKS (D), WASHINGTON: And we've got to get out to those caucuses on February the 7th, every one of us, and support John Dean and show him that Washington state -- excuse me, John Dean, where the hell I get -- John Kerry!

EDWARDS: Lady, that is one ugly baby.

CLARK: And I'm the toughest hombre in the race.

DEAN: (speaking Spanish)

CLARK: (speaking Spanish)

DEAN: We're going to keep going and going and going and going. Just like the Energizer Bunny.

LIEBERMAN: I've got a dream that the people of the First State are going to make Joe Lieberman first and it's going to kick this campaign into high gear.

I have decided tonight to end my quest for the presidency of the United States of America.

(END VIDEOTAPE)

WOODRUFF: A good man. And to top it all off I had to say that John Kerry played "bass" in a high school music group. Of course it's bass. I'm embarrassed.

That's it for INSIDE POLITICS. I'm Judy Woodruff. Join us again tomorrow for special coverage of the Michigan and the Washington state caucuses. Our live coverage begins at 7:00 p.m. Eastern right here on CNN, America's election headquarters. Have a great weekend.

"CROSSFIRE" starts right now.

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







Aired February 6, 2004 - 15:30   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(BEGIN VIDEOTAPE)
REP. RICHARD GEPHARDT (D-MO), FMR. PRESIDENTIAL CANDIDATE: And I'm proud to endorse him to be the president of the United States of America.

ANNOUNCER: Closing ranks. Ex-candidate Dick Gephardt hops on the John Kerry bandwagon.

SEN. JOHN KERRY (D-MA), PRESIDENTIAL CANDIDATE: Dick, you may think that you and Jane have earned yourselves a vacation, but we've got a lot of work for you to do.

HOWARD DEAN (D), PRESIDENTIAL CANDIDATE: I think it was a brilliant ploy, and I certainly stand by it.

ANNOUNCER: Do the polls bear him out? We'll have the latest on Howard Dean's Wisconsin or bust strategy.

The president gets ready for a grilling. What's behind his decision to do a Sunday talk show?

(END VIDEOTAPE)

JUDY WOODRUFF, HOST: Thank you for joining us.

Well, the power of endorsements has been debated and debated in this presidential campaign. Just ask Howard Dean and Al Gore. But Dick Gephardt's embrace today of former rival John Kerry provides at the very least a timely image of Democrats coming together. Not to mention the labor support that Gephardt brings to the table in places like Michigan, where the big announcement was made.

CNN's Kelly Wallace joins us from Flint, Michigan -- Kelly.

KELLY WALLACE, CNN NATIONAL CORRESPONDENT: Judy, what Dick Gephardt does, just as you were noting, is gives John Kerry immediate clout with industrial union workers, especially in a state like Michigan, which lost 170,000 manufacturing jobs in three years, according to the state's governor. Many union workers have been somewhat concerned about John Kerry's record, especially his support in the past of trade deals, including the one linking the United States, Mexico and Canada.

And so the choice and the setting for this endorsement no coincidence. The very union town of Warren, Michigan, and there Dick Gephardt said, of all the Democratic presidential candidates he believes John Kerry is the best qualified to win in November.

(BEGIN VIDEO CLIP)

GEPHARDT: That leader is John Kerry, and I'm proud to endorse him to be the president of the United States of America.

(END VIDEO CLIP)

WALLACE: And CNN has learned that Dick Gephardt convened a conference call on Wednesday with the labor presidents who were supporting him, urging them to back John Kerry, and that some of these presidents met with John Kerry yesterday in Boston. No word yet, though, of any endorsement, although others could come, we are told, next week.

There is one tough question, though, for Dick Gephardt. He made opposition to the North American Free Trade Agreement, the centerpiece of his presidential campaign, and this is a trade deal that John Kerry supported. He was asked about that during a news conference with reporters, and he says he believes that John Kerry now believes in the future. Trade deals need to include labor and environmental standards, and he says that is a position much closer to his own -- Judy.

WOODRUFF: And, in fact, that's one of the things I asked Dick Gephardt about. We're going to be running that interview in just a few minutes.

Kelly, separately, what is the Kerry camp saying about this report -- Associated Press Report today -- that he gave -- in return for recommending people for federal positions on federal commissions, he received political contributions?

WALLACE: Right. This report saying that there were three times where just before or right after he nominated people to federal positions he received political donations. Well, the campaign is responding very, very aggressively, saying there is really no "there" there to this story.

Stephanie Cutter (ph), the senator's press secretary, saying that these were all people who were in high standing, big-time supporters of John Kerry. That they were professionals, and that they are deserving of these posts. That there was no connection at all, entirely coincidental to these political donations. Well, some of the senator's own rivals, including Wesley Clark, are coming out with statements of their own.

Wesley Clark commenting about this report and others this week, saying that John Kerry is really representing inside Washington, putting, in his words, political interests ahead of national interests. The Kerry campaign responding very aggressively. Again Stephanie Cutter (ph), the president's press secretary, saying that Wesley Clark earned more than $1.6 million as a lobbyist last year. So she's pointing fingers at him, saying if he wants to change the way Washington works, then he should look at his own career choices, as well -- Judy. WOODRUFF: All right. Kelly Wallace following the Kerry campaign today. Thank you very much, Kelly.

And picking up on that comment Kelly made, one of the questions is, were the disagreements between John Kerry and Dick Gephardt -- did they make it any harder for Gephardt to go ahead and endorse the Senator? Well, that's one of the things I asked Dick Gephardt. And we'll be running that interview in just a few minutes.

Now we go to Howard Dean's New home away from home, Wisconsin. The latest Wisconsin poll suggests that Dean's must-win focus on that state's February 17 primary is going to be an uphill battle. It shows John Kerry far and away the leader in Wisconsin, with Dean a distant fourth place. Now, this poll was taken before Kerry's wins this past Tuesday.

CNN's Joe Johns is with Howard Dean in Wisconsin. He's on the telephone with us now from Milwaukee.

Joe, in essence, how is Howard Dean's Wisconsin strategy going?

JOE JOHNS, CNN CORRESPONDENT: Well, Judy, Dean has apparently raised a lot of money to fight for Wisconsin, according to his campaign. In their do-or-die e-mail, the one they sent out yesterday asking for $700,000, we've got to win Wisconsin, in fact, the paper advertising, as of early this afternoon, today, they said they had raised about $900,000. We have obviously no way of independently confirming that, but they say it gave them a jump-start.

Now in the campaign events this morning, Dean went to a coffee shop, shaking hands with people, pressing individual voters. Last night he hit the telephones. So the campaign is clearly trying to create moments for this candidate in front of the cameras where he's making a very direct appeal personally for their support.

Going forward, what they expect him to do is run biographical ads that will lay out Dean's resume and his record. We're being told there are no plans to go negative, because they think that's what hurt them in Iowa. But Dean did say last night at a news conference that he believes people have decided to vote for Senator Kerry without knowing anything about him, and he says he wants to contrast his, Dean's record, with Senator Kerry's -- Judy.

WOODRUFF: And he certainly has been doing that out on the campaign trail, even if he's not doing it in his ads. Joe, separately, this so-called Wisconsin strategy became public in an e- mail that the Dean people sent to their supporters. Dean called it a brilliant ploy last night. Any follow-up on that?

JOHNS: Well, the follow-up really is that it was another one of those unusual choices of words that has gotten him in trouble before. He got a number of questions on that, what did he mean by that. The campaign continues to get questions. Of course, his point is when he used the word "ploy" he was talking about a strategy.

On the other hand, there were some other things that stuck out, you know? He has portrayed himself as a very plain-spoken candidate. A straight talker, if you will. But when he was asked, if you lose here in Wisconsin, what happens, his answer was anything but direct. He said I'm kind of avoiding that question by just saying we're going to win. So it's really an issue of choice of words -- Judy.

WOODRUFF: It's one of those questions candidates have a hard time asking directly almost under any circumstances. All right. Joe Johns, thank you very much.

Well, John Edwards appears to be trying to lower expectations for his performance in Tuesday's primaries in Virginia and Tennessee. Even as he continues to campaign hard in those states, Edwards says he does not believe he has to win there, just finish in the top two. We'll get a report from the trail on Edwards' strategy a little bit later.

Over at the White House today, President Bush named seven members to a bipartisan commission to review U.S. intelligence, including information used to justify the war in Iraq.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: The commission will compare what the Iraq Survey Group learns with the information we had prior to Operation Iraqi Freedom. It will review our intelligence on weapons programs in countries such as North Korea and Iran. It will examine our intelligence on the threats posed by Libya and Afghanistan before recent changes in those countries. Members of the commission will issue their report by March 31, 2005.

(END VIDEO CLIP)

WOODRUFF: Let's bring in our senior White House correspondent, John King, to talk more about this panel, and the politics around it -- John.

JOHN KING, CNN SR. WHITE HOUSE CORRESPONDENT: Judy, the politics quite fascinating. We are obviously in the middle of a re-election year here. This report from this commission not due until next year in March, well after the election. But the president knows this commission is being criticized already by the Democrats.

That is one of the reasons he put three Democrats on this commission. We are told at least one more to come. They're trying to recruit a Democratic member of Congress. And according, at least to Democratic sources, having some difficulty doing that.

But the president had as the co-chair former Senator Chuck Robb. Also the former governor of Virginia. A Democrat, an ex Marine.

The president also tapping former federal judge Patricia Wald. She is another Democratic appointee considered by Bill Clinton for the Supreme Court during his administration on this panel. And in the middle here, Lloyd Cutler, White House counsel to presidents Clinton and Carter. Three Democrats viewed by both Democrats and Republicans as officials of character and integrity. The president hoping that by naming three Democrats like this, and again at least one more to come, he would quiet those who say there is no way a commission solely appointed by the president can, in fact, be independent. Well, the president might hope that argument takes hold out in the country, Judy. It is not taking hold in Washington, at least initially.

Nancy Pelosi, the House Democratic leader, saying this is a commission wholly owned by the president, wholly owned by the White House, and cannot be truly independent. So the initial Democratic reaction is to ignore the Democratic members and to simply say this panel cannot be independent. But again, the White House political calculation, Judy, is that out in the country they will look at these senior Democrats on the commission, and think OK, let's give this a chance.

WOODRUFF: Presumably that gives it -- gives whatever the outcome is more credibility. All right. John King, thank you very much, at the White House.

Another political flashpoint for the Bush camp, and that is jobs. Still ahead, is the president satisfied with the latest unemployment numbers? We'll talk to Bush labor secretary Elaine Chao.

Plus, a scene-setter for Tuesday's Virginia primary. Governor Mark Warner will share his take on the Democratic presidential race and how his state figures in.

And John Kerry rocks on, circa 1961.

This is INSIDE POLITICS, the place for campaign news.

(COMMERCIAL BREAK)

WOODRUFF: A picture of the capitol on this icy cold day in Washington.

Well, the state of Virginia next door holds its Democratic presidential primary next Tuesday. While Both of its U.S. senators are Republicans, Virginia's governor is a Democrat. Just about an hour ago, I asked Governor Mark Warner when he intends to follow the lead of some other governors who have endorsed John Kerry before contests in their states.

(INSERT WARNER)

WOODRUFF: Virginia Governor Mark Warner talking to us just a short time ago.

President Bush has kept his distance from the Sunday talk shows. But all that changes this weekend. Howard Kurtz previews the president's Sunday sit-down and asks the question, "Why now?"

Also, why is Al Sharpton all alone? The presidential hopeful makes the most of his time at center stage.

(COMMERCIAL BREAK)

WOODRUFF: Want to share with you some comments President Bush made just a short time ago at the National Targeting Center here near Washington, which gives targeting expertise to homeland security in the war on terror. Here's part of what the president said.

(BEGIN VIDEO CLIP)

BUSH: Our government and many of the employees are really working hard. And here I've learned -- I've seen how we're able to make information with terrorists lists or information with potentially dangerous cargo so we can spread valuable information throughout the country at ports of entry or border crossings. And it's a fascinating place.

It's a place where, after 9/11, we -- it grew, and it grew with getting the very best programs, programmers and computers to keep us better protected now. I really want to thank the people here.

On another front I'm pleased, obviously, with the new job growth. I've been saying that this economy looks pretty strong. And today, 112,000 new jobs were created last month. A reported 112,000 new jobs were created last month. And that's good.

Things are getting better. There is more to do. But this economy is growing in strength, and I'm obviously pleased with that.

Thank you all for coming. Thank you.

(END VIDEO CLIP)

WOODRUFF: President Bush, some comments he made just a short time ago at the National Targeting Center. For those of you not familiar, it's an organization that provides targeting information to the Department of Homeland Security to support the timely and accurate flow of information pertaining to national security and terrorist activity.

We'll be right back.

(COMMERCIAL BREAK)

WOODRUFF: President Bush has agreed to a rare news interview this weekend with one of the Sunday morning talk shows. Media critic Howard Kurtz of CNN's "RELIABLE SOURCES" has more on the president's decision to step out of his media comfort zone.

(BEGIN VIDEOTAPE)

HOWARD KURTZ, CNN "RELIABLE SOURCES" (voice-over): When it comes to television sit-downs, President Bush likes softer settings. The most important appearance of his 2000 campaign was probably when he and Laura Bush shot the breeze with Oprah Winfrey, who got a kiss on the cheek.

And while the president in the past 18 months has granted interviews to the likes of CBS' Scott Pelly (ph) Fox's Brit Hume, he may have been most at ease with ABC's Barbara Walters and Diane Sawyer.

So what explains Bush's decision nine months before the election to face a sustained inquisition by Tim Russert on this Sunday's "Meet the Press?" The president has been taking a pounding from the Democratic candidates. He's been hurt by the WMD report of former weapons inspector David Kay. And polls show him losing to John Kerry. What better way to get back in the game than by showing he can hit big league pitching on the top-rated Sunday show?

Richard Nixon once did a brief cameo an "Laugh-In." But the real talk show pioneer was Bill Clinton. He famously played the sax on Arsenio Hall in '92, and as president, schmoozed with Larry King and fielded a somewhat intimate question on MTV.

WILLIAM JEFFERSON CLINTON, FMR. PRESIDENT OF THE UNITED STATES: Usually briefs.

KURTZ: The preferred venues have gotten softer and funnier over the years. Al Gore tried to lighten up his wooden image by yucking it up with David Letterman. Arnold Schwarzenegger stunned the world by throwing his hat in the California ring, and joking about his bikini wax, with his pal Jay Leno. John Edwards, who just this week did a drop-by on Letterman's "Late Show," actually announced his White House bid on Comedy Central's "Daily Show."

JON STEWART, "THE DAILY SHOW": Do you have plans to announce it in another, let's say more -- what's the word I'm looking for -- professional environment?

SEN. JOHN EDWARDS (D-NC), PRESIDENTIAL CANIDIDATE: No. I'm counting on you.

STEWART: What?

KURTZ: Howard Dean tried to recover from his infamous Iowa scream with this "Top 10" list on "Letterman"...

DEAN: Oh, I don't know, maybe fewer crazy red-faced rants?

KURTZ: Dean also chatted up Diane Sawyer with his rarely seen wife, Judy. And Al Sharpton hosted "Saturday Night Live," not that it did his campaign a whole lot of good.

(on camera): Insiders call it the "Russert primary," these hour- long examinations on "Meet the Press." And both Dean and Edwards stumbled when their performances were panned last year.

The stakes may be considerably higher for an incumbent president if Russert is as aggressive as he has been with the Democratic candidates. But there are a lot of talk shows out there. So don't rule out a return presidential appearance on "Oprah."

This is Howard Kurtz, of CNN's "RELIABLE SOURCES."

(END VIDEOTAPE)

WOODRUFF: So if the president does well, will it improve his poll ratings? We'll see.

Checking the headlines now in our "Campaign News Daily," only Al Sharpton bothered to show up at a forum sponsored by the NAACP in Detroit last night. Sharpton took the stage with three empty chairs and made the most of his chance to address the crowd alone. John Kerry, Wesley Clark and, with just hours to spare, Howard Dean, all canceled plans to appear at the event.

The Pentagon has scrapped a plan that would have allowed military service members and their families overseas to vote over the Internet. Defense Department officials made the decision two weeks after an outside study questioned the security of a new online voting system.

Former Senator Robert Torricelli is raising campaign cash for John Kerry. Torricelli tells politicsnewjersey.com he has personally helped to collect almost $100,000 for the Kerry campaign. We'd like to know what the senator's campaign has to say about that.

Senator Kerry's past life in a garage band has resurfaced. And his group's one album is now available on eBay. Kerry played bass for the Electras while he attended St. Paul's School in Concord, New Hampshire. The last-check bidding for a copy of the album recorded in 1961 has climbed above $500. Kerry's been known to play a little guitar on the campaign trail, but the "Boston Herald" reports the other former band members are now Republicans.

Our exit polling in this year's primaries shows that voters are very worried about the U.S. economy. Coming up, I'll ask Labor Secretary Elaine Chao about the latest news on unemployment and job creation.

And later, a rare public appearance by former first lady Nancy Reagan, marking her husband's 93rd birthday, which is today.

(COMMERCIAL BREAK)

(BEGIN VIDEOTAPE)

ANNOUNCER: They don't always see eye to eye. So why is Dick Gephardt backing Democratic front-runner John Kerry? Judy speaks with the former presidential hopeful.

The expectations game. Is John Edwards lowering his?

EDWARDS: I think in Tennessee and Virginia I have to be competitive, which I think means in the top two.

ANNOUNCER: You've seen the highlights, but we've got some of the lighter moments from the campaign trail this week.

DEAN: We're going to keep going and going and going and going and going, just like the Energizer bunny.

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

(END VIDEOTAPE)

WOODRUFF: Welcome back. On the eve of the Michigan caucuses, John Kerry seems as well-positioned as ever in a state with its hefty prize of 128 delegates. The latest Michigan poll shows Kerry with 52 percent support. No one else even comes close. On top of that, Kerry now has former rival Dick Gephardt in his corner. A potential drawing card for support by unions that are so influential in Michigan and elsewhere. After Gephardt announced the endorsement in Michigan today, I spoke with him and started by asking him if it was hard to get behind somebody else's candidacy?

(BEGIN VIDEOTAPE)

REP. RICHARD GEPHARDT (D), MISSOURI: No, it really wasn't. I said from the beginning of this campaign that the campaign is not about me, it's not about any of the other candidates. It's really about the future of the country. The future of education, jobs, health care. That's why I ran. And it never was about me. So I want us to win. And this is the most important election of my lifetime. And I'm going to do everything I can in my power to help us win this election. And I think with John Kerry we have a candidate that we can win with. He's got the ability and the qualifications to do this job. And that's what people are going to look for in November of next year -- of this year.

WOODRUFF: You mention jobs. But you said less than a month ago in Iowa and I'm quoting you, you said I don't think we can beat George Bush if we maintain a position on trade like George Bush. And you went on to say John Kerry has shared the same position that George Bush has on NAFTA and on China. Have you changed your mind?

GEPHARDT: Well, the good news is that during this whole election period, and in all the debates we had, I found a growing agreement among all the candidates, and certainly including John Kerry, on the question of trade. Even though we had had disagreements on NAFTA and on the China agreement, which I brought out in the campaign, I think John has come to an understanding that we've got to have labor and environmental conditions in the context of any treaties that are done. And we need to try to get that into the NAFTA agreement and into the China agreement. And I'm satisfied that John will lead toward that conclusion. I really feel good about the success that I've had in bringing this issue to the table in this campaign.

WOODRUFF: John Kerry does not agree with you about the need to roll back President Bush's tax cuts for the middle class. That doesn't bother you?

GEPHARDT: Well, again, I think we have a lot of essential agreement. We didn't agree exactly on how much of the tax cut should go away. How much the health care plan should be. But he is willing to roll back the parts that went to the wealthiest and that was 50 or 60 percent of the tax cut. And all during the last year, I maintained that I would try to hold onto the marriage penalty and the child care credit, and I do that through closing loop holes in other places for corporations. So I think we can find essential agreement on that issue.

WOODRUFF: Should President Bush's alleged absence from National Guard duty back in the '70s be any issue -- be an issue at all in this campaign?

GEPHARDT: Well, I think all of us always face scrutiny about how we conducted ourselves before we got into public life, and obviously during public life. John Kerry's record of military service is there for everybody to see. He has a distinguished record. He fought heroically for the United States in Vietnam. And did it on repeated occasions. So I think, you know, voters will look at that record. And they will look at the difference in how people served, and that's as it should be.

WOODRUFF: Yes or no, are you interested in being vice president?

GEPHARDT: That's really not a question that should be even entertained today. We've got a big job ahead of us. We've got to get John Kerry to win this nomination. Our other candidates are great candidates. This is still going to be a hard-fought contest. And then we've got to prepare to win in the fall. That's what I'm interested in. And not anything else.

(END VIDEOTAPE)

WOODRUFF: Dick Gephardt talking to me just an hour ago.

John Edwards today called Dick Gephardt a, quote, "wonderful man." But suggested his endorsement of John Kerry wouldn't sway voters much. Today Edwards is campaigning in Virginia and Tennessee, while downplaying his prospects in Tuesday's primaries. CNN's Phil Hirschkorn is with Edwards in Tennessee.

(BEGIN VIDEOTAPE)

PHIL HIRSCHKORN, CNN CORRESPONDENT (voice-over): John Edwards is campaigning by bus in Virginia and Tennessee, but the North Carolina senator says he doesn't have to win those primaries next Tuesday, though they're in his backyard. Edwards and his senior staff telling us they'll be satisfied if Edwards finishes in the top two, and if they had another week on the ground Edwards might overcome John Kerry's momentum. Edwards tells us he sees the nomination process as a war of attrition, and that he will be one of the last two men standing perhaps after a final four showdown in Wisconsin.

Wesley Clark is his immediate obstacle, especially in Tennessee. This campaign believes a lot of Clark voters would support Edwards if the general were not in the race. Meantime Edwards is fine-tuning his stump speech to talk more about trade and jobs and today's unemployment numbers.

SEN. JOHN EDWARDS (D-NC), PRESIDENTIAL CANDIDATE: You know, providing for American security also means providing for securing American jobs.

HIRSCHKORN: Edwards' senior staff tells us they believe that Kerry's momentum is built on the fallacy that the Massachusetts senator is more electable. Campaign pollster Harrison Hickman says exit polls in the early primaries show that people who make a Democrat electable, independents, moderates and cross-over Republicans prefer Edwards. For example Edwards won more support from Republicans than Kerry did in the battleground state of Missouri, and more moderates in Missouri, Arizona and New Hampshire.

And in Oklahoma, though Edwards lost by less than one percent to Clark, Edwards won more counties carried by President Bush in the 2000 election. The campaign's message, Edwards is electable in November, and they'd be able to prove it in a one-on-one matchup with anyone. Phil Hirschkorn, CNN, Bristol, Tennessee.

(END VIDEOTAPE)

WOODRUFF: Howard Dean suggested today that he would consider the No. 2 spot on the Democratic ticket if it would help defeat President Bush. But Dean told a Wisconsin radio interviewer that he still is planning on winning the nomination himself. Despite his winless streak this primary season. Dean has indicated that Wisconsin's primary February 17th could be his last stand. Meantime Wesley Clark is stepping up his attacks on his rivals. In Tennessee today he accused John Edwards of voting against programs to help the nation's veterans. The Edwards camp in turn accused Clark of dipping into the gutter and throwing whatever he can find.

The '04 Democrats kept up their criticism today of President Bush's economic policy citing a mixed jobs report. The unemployment rate fell a tenth of a percentage point in January to 5.6 percent. That is the lowest level in two years. 112,000 new jobs created last month. But a weaker gain than 150,000 jobs that many economists had predicted.

We are joined now by the Secretary of Labor, Elaine Chao.

Thank you very much for being with us.

ELAINE CHAO, SECRETARY OF LABOR: Nice to be with you.

WOODRUFF: Madam Secretary, what about this notion that, yes, it's good news, there were 110,000 jobs created, but it's not the rate needed to get this economy moving the way it needs to get moving?

CHAO: Well, I think today's news is good news in that the unemployment rate has dropped to 5.6 percent even as the labor pool participation rate increased. So what that meant was that more people enter the work force and, yet, the unemployment rate drops. So that's good news.

In addition, 122,000 new jobs have been created, as we saw in the employment survey. There's also another survey called a household survey which showed that 497,000 workers have found new jobs, as well.

So we have two surveys. While they differ in magnitude, they both show continued strength in the economy and continued strength also in job hirings. WOODRUFF: I want to cite the one economic analyst with Credit Suisse First Boston. He said, these are his words, quote, "very disappointing; we're not getting the jobs to replace the stimulus in the economy which will fade once the first quarter ends." Another economist said, "It's the weakest job-creation rate relative to economic growth on record."

CHAO: Well, the stock market is, after all, the final arbiter. And the stock market was very strong this morning in reaction to the news that we have just received.

Of course, we're not satisfied with the rate of job creation, although this is the fifth straight month in which job creation has occurred. So we want to implement the president's -- we hope that the Congress will implement the president's proposed six-point economic package. And the president has also put $500 million to help programs that will increase job hires for the 21st century workforce.

And we at the Department of Labor do a great deal with our programs to help people train for new jobs, because there are jobs available. And what our challenge is, is to help workers gain the training or the retraining to access these new jobs and job growth opportunities.

WOODRUFF: But, again, you get these comments, like from Morgan Stanley, market economists saying the level of job creation certainly disappointing for, what he said, the 26th month of the alleged economic recovery.

CHAO: Well, as I mentioned, the stock market reacted, and the stock market was very positive. So, of course, today's news is good news, but we're not satisfied, and we need to do more. And that's why, again, the president's six-point economic program, where he asks for making the tax reduction permanent, where we have tort reform, where we pass the energy program so that more employment can occur, and that we make health care more accessible and affordable to more Americans.

WOODRUFF: There was an Associated Press consumer confidence poll done this week that showed a drop in consumer confidence in January, the analysis saying the market is what's driving consumer confidence and spending down. How do you see that?

CHAO: I don't think that's correct. I think consumer confidence is up. I mean, overall our economy is doing very well. Inflation is at the lowest rate in well over 20 years. Interest rates are at an all-time low. Home refinancings have increased. New construction has increased.

WOODRUFF: So to the people who are still looking for work, is the message, "Be patient," or...

CHAO: Oh, no, of course not. We're very concerned about them. And we have a department that offers an array of programs to help people who are unemployed. We as a nation are very compassionate. We spend about $15 billion a year to help those who are unemployed with unemployment insurance benefits, with income support of all kind, as well as training programs. So we have a great deal to offer to workers who are unemployed and who are looking for new job opportunities. As I mentioned, the president offered $500 million more on top of that for job training.

WOODRUFF: We hear you loud and clear.

The Secretary of Labor, Elaine Chao.

Thank you very much for coming by.

CHAO: Thank you.

WOODRUFF: We appreciate it. Good to see you again.

Former President Ronald Reagan has a birthday today. He is 93 years old. Coming up, Nancy Reagan attends a special tribute to her husband.

Later, is winning five of seven primaries good enough to get the "Political Play of the Week"? Let's just say John Kerry is sure to be asked about the even Bill Schneider picked.

And who says running for president isn't anything to laugh about? Stay with us for some lighter moments from the campaign trial.

(COMMERCIAL BREAK)

WOODRUFF: Former President Ronald Reagan turned 93 today. Nancy Reagan greeted schoolchildren at the Reagan Presidential Library in California. They, in turn, sang "Happy Birthday" in her husband's honor.

The former first lady also unveiled a cornerstone for a pavilion that will house the Air Force One that was used by the Reagans.

When reporters asked how her husband's holding up, Mrs. Reagan said fine. The former president suffers from Alzheimer's disease.

INSIDE POLITICS will be right back.

(COMMERCIAL BREAK)

WOODRUFF: Bill Schneider's with me now for more on a volatile issue that made headlines once again this week and shows no signs of fading away any time soon -- Bill.

WILLIAM SCHNEIDER, CNN SENIOR POLITICAL ANALYST: Judy, as you know, a whole new controversy burst upon the political scene this week. How did it get there? Through the "Political Play of the Week."

(BEGIN VIDEOTAPE) MATT DANIELS, PRES., ALLIANCE FOR MARRIAGE: No one had any real question about the result in Massachusetts. And this means now that the battle's moving national.

SCHNEIDER (voice-over): The battle is over gay marriage. after the Massachusetts Supreme Judicial Court this week informed the state legislature that nothing short of full-fledged marriage for same-sex couples would meet the requirements of the state constitution.

The 4-3 decision is creating a political uproar in Massachusetts. It's forcing politicians everywhere to deal with the divisive issue they want to stay as far away from as possible. Like, say John Kerry, who's from Massachusetts.

KERRY: I personally believe the court is wrong.

SCHNEIDER: Now wait a minute. In 1996, President Clinton signed the defense of marriage act, which banned federal recognition of gay marriages. Kerry voted against it.

KERRY: I voted against gay bashing on the floor of the United States Senate.

SCHNEIDER: Meanwhile, President Bush is under pressure to back a constitutional amendment banning gay marriages.

BUSH: If judges insist on forcing their arbitrary will upon the people, the only alternative left to the people would be the constitutional process.

SCHNEIDER: At the risk of damaging his image as a compassionate conservative.

MARY BONAUTO, PLAINTIFF'S ATTORNEY: No matter how you feel about marriage, it's always going to be wrong to go out of your way to amend the Constitution to discriminate against one particular group of people.

SCHNEIDER: This week the curtain came up on a new act in the nation's long-playing culture wars. Right...

DANIELS: This is about redefining marriage for our entire nation against the will of the people.

SCHNEIDER: ... versus left.

EVAN WOLFSON, EXEC. DIRECTOR, FREEDOM TO MARRY: When the dust settles, people are going to see what the Massachusetts court said, that allowing marriage equality will help families, while hurting nobody.

SCHNEIDER: But the dust is not likely to settle any time soon. This is a "Political Play of the Week" with the potential for a very long run.

(END VIDEOTAPE) SCHNEIDER: And guess where the Democratic Convention's being held this summer? Massachusetts. And the Republican Convention is in New York, which has a large activist gay population. This issue is not likely to fade away soon.

WOODRUFF: Doesn't sound like it. All right. Bill Schneider and "The Play of the Week." Thanks very much.

Wesley Clark's strategy for a comeback victory. Up next, "Inside Buzz" from Bob Novak on what the retired general is telling his supporters in Congress.

(COMMERCIAL BREAK)

WOODRUFF: Bob Novak joins us now from the "CROSSFIRE" set at George Washington University with some "Inside Buzz."

All right, Bob, first of all, some insight into a recent Wesley Clark strategy session with a group of his supporters.

ROBERT NOVAK, CO-HOST, "CROSSFIRE": He called his -- after he won the Oklahoma primary, he called his supporters together on the Hill. And ten Congressmen who are endorsing him, who are supporting him, met in Congressman Charlie Rangel's office on the speakerphone to hear General Clark say that he had a very good shot of doing well in Tennessee and Virginia next week, one first, one second.

But what I found interesting is he has 21 members of Congress who have endorsed him, only ten showed up for this meeting. And conspicuous by his absence was Congressman Rahm Emmanuel, the hot-shot young congressman from Illinois, kind of a link to the Clintons. Congressman Emmanuel told me he had a scheduled hearing on the Financial Services Committee so he couldn't be there.

WOODRUFF: All right. Howard Dean and that famous labor support that he's had from the beginning. What are you hearing about that?

NOVAK: I hear they are very restive, very uneasy with his very poor showing. Only got eight delegates last Tuesday night. Particularly AFSCME. And he's stirring the SCIU, the service employee's union is keeping his troops together. but they really want to leave. He's desperate to keep them at least until the Wisconsin primary saying that is my last shot.

WOODRUFF: All right. Something back here in Washington, the Highway Bill. What are you hearing about that?

NOVAK: The Highway Bill. A lot of people are urging the president to veto that bill, even though he may be overridden, people inside the administration and outside the administration to show that he really cares about spending.

He has put a limit of $260 billion on that bill. The members of Congress are addicted to highway pork. Both the House and Senate bill are well over $300 billion. He would probably be overridden. But Reagan was overridden on that kind of a bill and it really strengthened his presidency.

WOODRUFF: And finally, Bob, way out to Washington state. Congresswoman Jennifer Dunn, a Republican, announcing she's not running for re-election. What are you hearing about that?

NOVAK: That suddenly makes that district, which was a safe district as long as she was running, a contested district. It's a suburban district in Washington that Al Gore beat Bush on very comfortably in the last election.

They have a self-financed dotcom multimillionaire named Alex Alden, who is the Democratic candidate. There is a contest between Sheriff Reichert out there and a former regular talk show host, John Carlson, for the Republican nomination.

So that is one seat that the Democrats didn't have a chance for that they have a chance for since Jennifer Dunn is not running.

WOODRUFF: We like the thought of former talk show host running.

NOVAK: Yes. Have you thought of that, Judy?

WOODRUFF: OK, all right. Bob Novak. We'll see you on "CROSSFIRE" coming up in about six minutes.

NOVAK: Thank you very much.

WOODRUFF: A look back at the week in politics.

(BEGIN VIDEO CLIP)

CLARK: I'm the toughest hombre in the race.

(END VIDEO CLIP)

WOODRUFF: Up next, the tough talk, the flying fish, and other highlights from the campaign trail.

(COMMERCIAL BREAK)

WOODRUFF: Time now for a look back at "The Week in Politics." The highlights and the lowlights from the campaign trail.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: Ladies and gentlemen, the president of the United States.

BUSH: And knowing what I know today America did the right thing in Iraq.

CLARK: Oklahoma is OK.

KERRY: It's great to see New Englanders go to Texas and win.

Like father, like son, one term and you're done. EDWARDS: And I'm going to beat George Bush in my backyard.

JON STEWART, HOST, "THE DAILY SHOW": Edwards added that George Bush must be defeated, because, quote, "When it's time to change you've got to rearrange."

EDWARDS: Read my lips, no new wardrobe malfunctions.

REV. AL SHARPTON (D), PRESIDENTIAL CANDIDATE: I know a man! I know a man!

REP. NORM HICKS (D), WASHINGTON: And we've got to get out to those caucuses on February the 7th, every one of us, and support John Dean and show him that Washington state -- excuse me, John Dean, where the hell I get -- John Kerry!

EDWARDS: Lady, that is one ugly baby.

CLARK: And I'm the toughest hombre in the race.

DEAN: (speaking Spanish)

CLARK: (speaking Spanish)

DEAN: We're going to keep going and going and going and going. Just like the Energizer Bunny.

LIEBERMAN: I've got a dream that the people of the First State are going to make Joe Lieberman first and it's going to kick this campaign into high gear.

I have decided tonight to end my quest for the presidency of the United States of America.

(END VIDEOTAPE)

WOODRUFF: A good man. And to top it all off I had to say that John Kerry played "bass" in a high school music group. Of course it's bass. I'm embarrassed.

That's it for INSIDE POLITICS. I'm Judy Woodruff. Join us again tomorrow for special coverage of the Michigan and the Washington state caucuses. Our live coverage begins at 7:00 p.m. Eastern right here on CNN, America's election headquarters. Have a great weekend.

"CROSSFIRE" starts right now.

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