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Bush Preaches Vigilance in War on Terror; Congress Investigates WorldCom; How Will Bush's Popularity Affect November Elections?
Aired July 06, 2002 - 10:00 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.
(BEGIN VIDEO CLIP)
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: The best way for us to secure the homeland is to hunt this enemy down.
(END VIDEO CLIP)
JONATHAN KARL, HOST: The president preaches vigilance in the war on terrorism, as concerns linger about homeland security. We'll talk with a key member of the Senate Intelligence Committee, Democrat Evan Bayh of Indiana, about where the war stands and on what he learned on his just-completed trip to the Middle East.
Then, Congress investigates the WorldCom scandal. Two lawmakers debate the political fallout and the best way to protect consumers and investors.
Plus, the president's wartime popularity and how its playing in the battle for your vote in November.
All just ahead on CNN's SATURDAY EDITION.
Good morning to California, the rest of the West, and all our viewers across North America. I'm Jonathan Karl in Washington.
We want to hear from you over the next hour. Our e-mail address is saturday.edition@cnn.com.
In a moment, we'll talk with Democratic Senator Evan Bayh of Indiana, who is just back from the Middle East, but first a news alert.
(NEWSBREAK)
KARL: We're just a few minutes away from the president's radio address, but joining us first, Senator Evan Bayh of Indiana. He is a member of the Senate Select Intelligence Committee, and he is just back from a trip with other members of that committee in the Middle East.
Senator, we just have this news now on this assassination, the second senior official in the Afghan interim government being killed, gunned down. What do you think are the implications here? SEN. EVAN BAYH (D), INDIANA: Well, it should remind all of us, Jonathan, of what a tenuous government exists in Afghanistan. The country is still awash in weapons. They are still hostile elements. And we're going to -- it's going to take some time to have a stable government there that doesn't have to endure these kind of attacks.
So it's very unfortunate but, frankly, not terribly surprising, given the conditions there.
KARL: Have you heard anything further on this? Have you gotten anything beyond these initial, preliminary news reports?
BAYH: No. There are a number of theories that are being tracked down. The Afghans are investigating it. I'm sure we'll be assisting them in that regard. But nothing to add to your report just yet. It's all so new.
KARL: And what does this say about the level of involvement that the U.S. will need in Afghanistan and the dangers of our involvement? I mean, this was somebody that was very well protected, theoretically.
BAYH: Well, theoretically very well protected, but again, it reminds us of the inherent danger in that part of the world and the fact that, you know, stable democracies are an uncommon thing anywhere on earth but particularly in that part of the world.
And it's going to take some time. The president mentioned that we're more resolved that ever. It's going to take resolve and some time to have the kind of government there that can provide stability for Afghanistan and not allow it to sink back into the condition that allowed al Qaeda and the Taliban to put their roots in there and foster terrorism that eventually, of course, came home to hurt us here.
KARL: Now, in your trip to the Middle East, you sat down for some time with President Assad of Syria. This is a country that the U.S. has repeatedly accused of sponsoring and supporting terrorism. What came out of that discussion?
BAYH: It was interesting, a two-track discussion. They do have an unfortunate record with regard to, particularly, Hezbollah in the past. And of course Hezbollah has a history of violent acts against Israelis, and there are three ranking members of Hezbollah under indictment for murder in this country.
But there have been, putting Hezbollah aside, some recent signs of cooperation from the Syrians in the fight against al Qaeda. They have no love lost for Sunni extremists. They have their own history of violent terrorist acts in their own country that they brutally crushed a decade or more ago. And they have been, shall we say, cooperative in some respects in ways that have helped us in our latest struggle.
So the challenge here is how to deepen and encourage this new cooperation on the one hand, while still objecting very strongly to some of the activities of Hezbollah on the other. And that's the message that we delivered.
KARL: I also want to ask you what Syria and other leaders in the Arab world told you about Iraq. But first we have to listen to the president's radio address.
BUSH: This week Americans are celebrating the 226th anniversary of our independence. On the Fourth of July, we count our blessings. And there are so many to count.
We are thankful for the families that share our life in this land of liberty. We're thankful for the opportunities given to us every day in this country. And we are thankful for our freedom, the freedom declared by the Founding Fathers, defended by many generations and granted to each one of us by Almighty God.
Americans know that our country did not come about by chance. Our nation was first designed as a colony serving an empire and answering to a king. The founders had other things in mind.
In the summer of 1776 they declared that, "These colonies are and, of right, ought to be free and independent states." All Americans can draw a straight line from the free lives we lead today to that one moment when the world changed forever. From that day in 1776, freedom has had a home and a defender. Unlike any other country, America came into the world with a message for mankind: That all are created equal and all are meant to be free.
There is no American race. There's only an American creed. We believe in the dignity and the rights of every person. We believe in equal justice, limited government and the rule of law, personal responsibility, and tolerance toward others. These creed of freedom and equality has lifted the lives of millions of Americans, of citizens by birth and citizens by choice.
This creed draws our friends to us, sets our enemies against us and always inspires the best that is in us. In this 226th year of our independence, we have seen that American patriotism is still a living faith. We love our country only more when she is threatened.
America is the most diverse nation on earth, yet in a moment we discovered again that we are a single people. We share the same allegiance. We live under the same flag. And when you strike one American, you strike us all.
More than ever in the lifetimes of most Americans, our flag stands for a truly united country. We've been united in our grief, and we are united in our resolve to protect our people and defeat the enemies of freedom.
At this hour, more than 60,000 American troops are deployed around the world in the war against terror. Many of you have family members serving in the military. Wherever they're stationed, this nation is depending on them, and you can be proud of them.
America's service men and women and our veterans know better than anyone that our love for country is shown in works. A spirit of service is alive and strong in America today. As we fight a war abroad, at home Americans are answering the call of service, giving their time and energy to causes greater than self-interest. This nation is confronting a terrible evil, and we are overcoming evil with good.
Today, as much as ever before, America bears of the hopes of the world. Yet from the day of our founding, America's own great hope has never been in ourselves alone. The founders humbly sought the wisdom and the blessing of divine providence. May we always live by that same trust. And may God continue to watch over the United States of America.
Thank you for listening.
KARL: The president having a Fourth of July weekend address there, his radio address.
Coming up later, is Congress ready to tighten the reins on how corporate America operates?
And we'll continue our conversation with Senator Evan Bayh and take your e-mails, when CNN's SATURDAY EDITION returns.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
NAJI SABRI, FOREIGN MINISTER OF IRAQ: We need assurance from the United Nations. We are the victim of illegal practices forced by the United States on the Security Council. We are the victim. We have lost 1,670,000 Iraqis as a result...
(END VIDEO CLIP)
KARL: Iraq's foreign minister speaking Friday, his comments a reminder of U.S.-Iraq tensions and questions about a possible American effort to remove Saddam Hussein.
We're talking with Democratic Senator Evan Bayh, a key member of the Senate Intelligence Committee.
Senator Bayh, we saw an interesting story from the New York Times this week, yesterday, that the Times got a hold of some very specific and very detailed plans for an American invasion of Iraq. Now, no timeline in those plans. But Iraq is now rejecting, again, efforts to get U.N. weapons inspectors in.
What were the Arab leaders you spoke to, in Syria and Egypt, telling you about U.S. military plans for Iraq and what they would -- how they would react?
BAYH: Jonathan, it was very interesting. Neither President Mubarak nor President Assad has much use for Saddam Hussein, but they don't want the U.S. to take overt military action to remove him because it would, in their minds, establish a bad precedent of the U.S. coming in and forcibly removing regimes in that part of the world, which, understandably, gets some people a little nervous.
In the case of Syria, they're also concerned about the instability in Iraq because they are a neighboring country. And if that were to disintegrate into chaos, it might have implications for them.
They also are a little concerned about being surrounded by nations that are favorable to the United States. You know, you've got Israel, Turkey, Jordan, and then Iraq if there were to be a new regime there.
So they're all a little concerned about that, even though they have absolutely no use for Saddam Hussein.
Now, if covert means could be used to remove him, something, you know, quiet and less potentially destabilizing, I don't think there would be too many tears shed in either capital.
KARL: But now, these plans that the Times got a hold of talked about 250,000 American troops being used, coming in from the North, coming from the South and coming from the East.
Did President Assad or President Mubarak have any message to you and to this Senate delegation about how they would react with that kind of an American buildup going into Iraq?
BAYH: Neither one was favorable toward it because of the reasons that I just mentioned. I think the bottom line here, Jonathan, is if we can find some way to remove him absent the use of overt military force, there wouldn't be much objection to that. But if it requires essentially an invasion, they would both object to that, and object strongly.
KARL: And what about you?
BAYH: I think if it comes right down to it, if that's what we have to do to remove him, I think that that's what we should do. I think that it's not a question of whether we're going to have to deal with Saddam Hussein, I think it's a question of when.
And the real problem here -- I said directly -- I'll tell you exactly the question I posed to President Assad. I said, "The problem we have, Mr. President, is the existence of weapons of mass destruction in Iraq, combined with international terrorism, and the potential threat of those weapons falling into the wrong hands, where we would not lose 3,000 of our citizens, as tragic as that was, but potentially tens of thousands of our citizens. We cannot afford to run that kind of risk. We must act. Now, absent a military invasion, what would you have us do?" And he said basically, "Well, we don't think it's in your best interest. You know, you need to -- this requires subtle political and diplomatic pressure." But basically, he knew where we were coming from.
I think if it comes right down to it, we ought to try everything else, but if the military is the only remaining option, I think it's in our best interest to do that, because we can't run that kind of risk.
KARL: Now, you were also going over there after the president's speech, where the president, basically, effectively cut off Yasser Arafat, said, you know, we need to deal with different Palestinian leadership.
I want you to listen to how Saeb Erekat, Arafat's spokesperson, reacted to that.
(BEGIN VIDEO CLIP)
SAEB EREKAT, PALESTINIAN SPOKESMAN: To the Americans, we say that there is one address (ph) to the Palestinian people. This is the elected Palestinian leader, and anybody who wants to engage, seriously engage, they must deal with President Arafat.
(END VIDEO CLIP)
KARL: OK, now, the head of your delegation, Chairman Bob Graham, chairman of the Intelligence Committee, Democrat, almost immediately after the president effectively cut off relations with Arafat, said that he would like to meet with Arafat. Now, that meeting didn't take place, for logistical reasons, as far as I understand.
But would that have been a mistake? Was that a mistake for the chairman of the Intelligence Committee to essentially, at least apparently, contradict U.S. policy in saying that he would meet with Arafat?
BAYH: I didn't have a chance to talk with Senator Graham about that. As you know, I wasn't on that leg of the trip. But I personally would not have favored meeting with Yasser Arafat.
And it's a dilemma for us. And we saw this in our conversation with the other presidents. On the one hand, we stand for democracy. But on the other hand, it appears as, if an election were held today, the Palestinian would elect a leader who, I personally believe, is not in a position to help foster the kind of peace we need in that part of the world.
So it is a dilemma. I'm personally glad that the meeting ended up not happening.
KARL: And if you had been in a position where you delegation was meeting with him, would you have boycotted that meeting? Would you have held back?
BAYH: I would not have attended.
KARL: Now, I also want to show you some thing that Thomas Friedman, New York Times, said about U.S. policy in the Middle East. I think we have the graphic we can put up on the screen.
"For too many years we've treated the Arab world as just a big dump gas station, and as long as the top leader kept the oil flowing and was nice to Israel, we didn't really care what was happening to the women and children out back."
Now, he goes on to say -- do we have the second part of that graphic? "For too many years we've treated" -- that's the same page. Do we have the second one, guys?
BAYH: I read the article. I think I got the gist of it.
KARL: Well, I mean, you know, basically he's saying that we've had a -- we have to radically re-think U.S. policy toward the Middle East.
BAYH: Well, I think we need to take both a short-run and a long- term approach.
In the long run, Tom Friedman is exactly right. The more open those societies are, the more stable that they are because of that, the better it will be for the United States. Repressive regimes tend to breed terrorism, anti-Americanism and a variety of other things that aren't helpful to any of us. Now, that's in the longer run.
In the shorter run, Jonathan, we have a terrorist problem that we have to fight. And I think we have to use the regimes that are there to win that war even as we are pressuring them, in the longer term, to make the kind of reforms that are not only in their best interest but also in ours.
So I think Tom Friedman is right, but in the short run, you've got to deal with some people who are less than perfect to defeat people who are even worse.
KARL: And then finally, when you go over there on a trip like this, you have three key U.S. senators going over and meeting with these Arab leaders. What are the security measures like? I mean, how do you -- what's it like moving around Syria at a time like this?
BAYH: It reminded me...
KARL: Or Lebanon?
BAYH: It reminded me of how special our society is. I mean, you know, we have, even in these times, relatively light security. I mean, we have security, but it's not quite like driving around in armor-plated limousines, which was the case in Syria.
And Lebanon was an entirely different picture. I mean, they obviously -- any American in Lebanon leads a life that we can hardly relate to here in our country. Very heavy security from the moment you step off the plane to the moment that you get back on.
KARL: And you, talking earlier before the show, you'd mentioned that there are terrorist training camps in Lebanon that are something we need to really watch.
BAYH: Yes, this is something I'd keep my eye on. One of the lessons that we learned in Afghanistan is we waited too long to clean those camps out, and you allowed thousands of individuals to get training, disperse around the world, to them come back and attack us.
There are camps in Lebanon that serve a similar function. And we have to look very carefully at those, along with any country whose pressure we can bring to bear to try and eliminate that long-term threat to our country.
KARL: Well, Senator Bayh, thank you very much for coming in on this Fourth of July weekend. Just back from your trip and got a little jet lag. We appreciate you taking the time to spend with us.
BAYH: Always a pleasure.
KARL: Thanks.
Later in the hour, we'll talk with reporters with the inside scoop on the week's top stories. But up next, Congress takes on WorldCom. We'll talk with two lawmakers about the political fallout from the string of corporate scandals and Congress' plan for reversing the tide.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
JOHN SIDGMORE, PRESIDENT AND CEO, WORLDCOM: Now, while the collective rage currently is focused on WorldCom, I want to remind everybody that it was this company that audited our auditors. It was this company that turned itself in. It was this management team that took matters to the SEC. And it was this -- and it is this management team that will take this company forward and restore public confidence.
(END VIDEO CLIP)
KARL: There's the president and CEO of WorldCom this week, defending its company's response to revelations that it misstated nearly $4 billion in expenses.
WorldCom officials are scheduled to appear before the House Financial Services Committee next week. We're joined now by two members of that panel: On Long Island, Republican Congressman Peter King of New York, and in Chicago, Congressman Harold Ford of Tennessee.
Congressmen, welcome to both of you. Thanks for spending...
REP. PETER KING (R), NEW YORK: Good to be here.
KARL: ... a little Fourth of July with us.
REP. HAROLD FORD (D), TENNESSEE: Happy Fourth to you.
KARL: Happy Fourth to you.
Congressman King, right to you. You just heard the president of WorldCom basically say that the company's getting a bad rap, they're doing everything right now. What's you take? You're going to get a chance to question some of these guys this week.
KING: No, I don't think it's a bad rap at all. The fact is, if there was $4 billion that was counted the wrong way, if it was concealed, the fact is the corporate officials at WorldCom have to take the responsibility for that. They can't be ducking it. They can't just be blaming it on a financial officer. They can't be blaming it on auditors.
The fact is, that when you have a company that large, in fact any company, but certainly a company that large, you have to assume responsibility for the bottom line. And the fact is that many people have lost their jobs. Many stockholders have been severely damaged. And to me, the corporate officials at WorldCom have to absorb that responsibility, assume that responsibility.
You know, the level of responsibility will be determined as hearings go forward, as criminal investigations go forward. But they just can't literally pass the buck by saying that someone else did it. The fact is, it was done on their watch. They have to assume ultimate responsibility.
KARL: Now, with the Enron hearings, we had this parade of Enron executives come forward and essentially, you know, take the Fifth Amendment. We saw a lot of right hands raised and taking the Fifth Amendment.
What do you expect with these hearings now on WorldCom? Are these guys going to come out and talk and answer all of your questions?
KING: I think it's very possible that their attorneys will advise them to take the Fifth Amendment, but I think it's important that we go ahead with the hearings anyway, to lay out a record, to set the national debate and to get this process started.
So again, I would think some of them may take the Fifth Amendment. I have no inside knowledge of whether they're going to or not, but certainly based on Enron and other type hearings like that, I wouldn't be surprised if at least some of them did take the Fifth Amendment.
KARL: All right, Congressman Ford, we've got to talk about the political context here. I mean, you've got a situation where Democrats this week, I'm told, this upcoming week, are going to have an event a day, every day, to highlight the corporate accountability scandal and to say essentially that Republicans are largely to blame here because this is a result -- the Democratic argument goes -- of Republican deregulation.
What do you think? What's the political fallout here?
FORD: You know, I don't know, and I don't know if I'll participate in any of those settings.
I think the bigger issue, in addition to that the hearings are occurring this week and hearings that have already occurred with Enron, is really trying to address this eroding, this increasingly eroding confidence in investors and consumers and shareholders and, for that matter, workers have in the marketplace.
We have the greatest market and greatest system in the world, largely because of its transparency and the fact that we reward those who do well and punish those companies that don't do well.
Regrettably, we're faced now with the situation where companies have misstated or, frankly, lied about their earnings and profit and mislead investors in horrible ways.
So as much as Monday is important to hear -- and I would agree with Peter in every way -- to hear from WorldCom's executives to explain what were they doing, how did they do it and, frankly, what response do they have to their many employees, thousands of employees, almost a thousand in my own district in Memphis, as well as the many shareholders, and take from that how we structure legislation.
As you know, there's a Senate bill passed by Mr. Sarbanes' committee, the Banking Committee on the Senate side, that would address some of the accounting issues. That may not be enough, or it may be too excessive.
These are the kinds of questions that I hope to be able to pose to some of the WorldCom executives and hope that their answers will provide some insight for us as we move forward in the Congress.
KARL: Well, Peter King, I saw an article by Alan Reynolds, the conservative economist, basically saying that the biggest problem here is not the corporate scandals, but about what Congress may do as a result of the corporate scandals, with a whole new wave of regulations that will affect the markets. What do you think?
KING: Now, I consider myself a conservative, but I disagree with that analysis. The fact is that, yes, it's ideal to have free markets, to have unfettered markets. But it also, history has shown that when real abuses develop, we have to address them, we have to eliminate them to allow the market to continue free.
Because what's going to happen, as Harold Ford said, if people lose confidence in the transparency of the markets, you're going to see the entire system collapse.
So to preserve the free-enterprise system, to preserve capitalism, as Teddy Roosevelt did, we have to move quickly against those who abuse the trust.
KARL: OK, well, what about the president's speech? The president's going to actually go to Wall Street on Tuesday and deliver a speech on all this. And we've seen the markets have not always reacted very positively to statements about problems with corporate accountability and, you know, coming from the president, coming from the White House.
What are the risks with what you all are doing, in terms of highlighting this stuff? FORD: I think it will be positive for the president to go to Wall Street. I think one of the things the markets look for -- and I have never run a business. My family has run a business before, and I've been around it. But I would have to think that the business community would want some certainty, some predictability. And what Congress is doing now is important.
But I do hope that we act more swiftly. Markets, I believe, want to see if indeed regulation is going to come give them the opportunity to adjust. We shouldn't be excessive in it...
KARL: Congressman, I'm sorry to interrupt, but I'm told we need to take a break. We'll be right back and let you pick up just on that thought.
FORD: Sure.
KARL: We'll be back and ask not only about WorldCom but also about the decision of J.C. Watts, the only black Republican in Congress, to call it quits.
(COMMERCIAL BREAK)
KARL: It's time to check the hour's top stories. Here is Robin Meade in Atlanta with a news alert.
(NEWSBREAK)
KARL: We're continuing our conversation with Republican Congressman Peter King of New York and Democratic Congressman Harold Ford of Tennessee.
Gentlemen -- and, Harold Ford, we'll let you pick up right where you left off, but I want to do it by bringing out an e-mail that we just got from Michael. This is a viewer e-mail.
He asks, "If I were to borrow $10,000 from one of you and then defaulted on the repayment, telling you, `Sorry, the books were miskept, so let's forget about it,' you'd have me jailed for fraud or theft. Why shouldn't these men be treated the same way?"
FORD: They should and probably will be. I think Michael is absolutely right, and those are some of the things that I hope will come out on Monday and Tuesday in some of the hearings that will occur.
The point I was trying to make right before break about the president addressing this issue on Wall Street, it's really, up to this point, the president has not been -- I should say, has not really provided any amplified views on this issue. He's expressed his outrage like many of us in the Congress and, for that matter, Michael and others. But I think it's important for him to provide a road map for the Congress. If he signals his support for a significant piece of legislation, or at least the guiding principles for legislation, we can move on it quickly, pass it swiftly and allow the markets to respond accordingly. KARL: What are you encouraging the president to do, Peter King?
KING: I think it's very important, first, that there has to be immediate disclosure of any type of insider trading. And also, there has to be jail time for people who violate the corporate trust. Because it goes beyond their own corporations; we're talking about, really, a national issue here as far as the economy.
KARL: But that's a question of law enforcement. What about the president? I mean, because we have Democrats are now starting to say, as we just heard Harold Ford say, essentially, the president has been talking, saying the right things, but he's got to do something. What does he need to do?
KING: No, I think the president -- I think the president is going to lay that out in his speech. He's going to talk about stricter requirements, much more disclosure and transparency. And I believe he's going to call for stricter criminal enforcement.
So I think you are going to see a full range of presidential ideas, that he's going to lay out the road map that people like Harold Ford are looking for and all of us are looking for. I think he's going to provide the leadership in this war against corporate corruption, as he's provided the leadership in the war against international terrorism. It'll be there.
The leadership will be there. There has to be also, then, a strong debate in the Congress. And I believe, working together in a bipartisan way, we can address this issue and do it very quickly and very strongly.
KARL: All right. And very quickly, I want to take a look at this latest poll we have on what issues people are finding important for the midterm elections.
And you look -- right at the top of the list, no longer terrorism, but the economy. The state of the economy now, cited by 26 percent, is the number-one issue for them as they go in and vote in the midterm elections.
So, Congressman Ford, do you sense an opportunity there for the Democratic Party?
FORD: There will be plenty of time for politics and for the campaigning. And I'm up for re-election, Peter is up for re-election, and 433 of our colleagues are up as well.
So I imagine all of that will take care of itself, and we'll all have to go home, defend our records, and even promote the vision we have for tomorrow for this nation, whether it's on the economy, health care or education.
This issue here, though, requires some across-the-aisle work, and I'll join with Peter and other colleagues on the committee to make sure we pass something that's reasonable, that's sensible, but, most important, restores the confidence in the marketplace, which might mean it has to be a little tough.
KARL: All right. Well, one member of Congress that will not be up for re-election is J.C. Watts, who announced this week that he is not running for re-election. Let's listen to what J.C. Watts said.
(BEGIN VIDEO CLIP)
REP. J.C. WATTS (R), OKLAHOMA: 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.
(END VIDEO CLIP)
KARL: All right, well, Harold Ford, he was the only African- American Republican in the U.S. Congress. Does his leaving, in fact, say something about the state of the Republican Party?
FORD: He is my friend, my good buddy. I'm sad to see him leave, in a lot of ways. We didn't agree on a whole lot of issues, but we're able to work together on things that were meaningful.
I don't know what it says about the party. There were a lot of things written in some of the local newspapers on the Hill -- the Roll Call and the Hill newspaper and others -- about his displeasure with things that were occurring within his leadership, or within his Republican caucus.
But he's a good member and a good man, and I wish him the very best. But you probably have to ask him a little more in depth about what might have led him, if there were any political reasons that led him to quit the Congress.
KARL: Or we can ask Congressman King, who's right here with us. Congressman King, I mean, one thing we know about J.C. Watts is that he essentially had his legs cut out from under him in any effort to move up the leadership battle in the Republican Party. You know, he was thinking about running for whip or majority leader. Tom DeLay quickly had those seats wrapped up for himself and for Roy Blunt.
Did the Republicans mistreat J.C. Watts, force him out?
KING: First of all, let me say that J.C. Watts is a political superstar. He's a friend. And we in the Republican Party definitely are going to miss him, and the Republican Party is going to suffer because he's no longer an elected official in the Republican Party -- won't be an elected official after December.
Again, this is all the ins and outs of politics. My understanding is that there was no real hard feelings between J.C. and the Republican leadership. It's possible that he wanted to move up. I don't think it was anything against J.C. I think there's always, you know, struggling going on, there's always vying going on for top spots. I certainly would have supported J.C. if he had decided to run for the majority leader or for whip. He is a first-class guy. He's a real talented guy. I think we're going to hear a lot more from J.S. Watts in the future.
But, again, if we're trying to hint there was some racial component, I really don't think that was the case. I think, you know, Washington politics can be very tough on you whether you're white, black or any other color, and it's just a rough business. And J.C. may have just decided for his own personal reasons that, at this stage, he wanted to step aside.
But we are going to miss him, there's no doubt about that.
KARL: We only have about...
FORD: I shared with J.C. that if there are six seats separating the Democrats and Republicans, I shared with him, if he could convince five others to come with him, we'd make him majority leader on our side.
(LAUGHTER)
KARL: Yes, good luck. Good luck.
We have to go, but I do have a little bit of news for both of you. We just got -- I just got handed to me here the results from Wimbledon. The Williams sisters -- the match is over. Serena Williams beat her sister Venus 7-6 and 6-3. Straight sets in Wimbledon.
FORD: Wow.
KARL: Well, we knew one of the Williams would win over there.
Thank you very much, both of you. Thanks for joining us on the Fourth of July weekend.
FORD: Thank you.
KING: Thank you.
Take care of yourself, Harold.
KARL: Straight ahead, the president continues riding a wave of wartime popularity, but are his coattails long enough to give his party control of Congress? We'll get the inside story on that and more from our reporters roundtable, when CNN's SATURDAY EDITION returns.
(COMMERCIAL BREAK)
KARL: Welcome back. Joining me now are the reporters who cover White House and Capital Hill.
From beautiful Kennebunkport, Maine, where the president is spending this weekend and celebrating his birthday, is CNN's Kelly Wallace. And here in Washington, Mike Allen of "The Washington Post," Alexis Simendinger of the "National Journal," and Jill Zuckman of the "Chicago Tribune."
Welcome to all of you. Happy Fourth of July weekend.
MIKE ALLEN, WASHINGTON POST: Hi, Jonathan.
KELLY WALLACE, CNN WHITE HOUSE CORRESPONDENT: Hi, Jon.
KARL: Kelly, I wanted to see if we could get some news out of you right off the top. Do you have an reaction from the White House to this latest news out of Afghanistan, the assassination of one of the three vice presidents?
WALLACE: Well, Jon, you know, President Bush spoke out about this just a little bit earlier today after he was playing a round of golf. He condemned the killing. He said the U.S. mourns the loss of a man who was fighting for freedom and stability in the country of Afghanistan. And then he said the U.S. will not back down, that it's more resolved than ever to bring peace and stability to the country.
But as everyone knows, it comes at a very difficult time. This is the second minister, the second government official, to be assassinated this year. So it definitely raises questions about how tenuous this situation is and how much international aid and other work will be needed to, again, keep peace in that country -- Jonathan.
KARL: And, Alexis, this is the brother of Abdul Haq, one of the premier Afghan resistance fighters before the U.S. efforts, who also was killed during the war.
What does this say about the challenges the president faces in trying to maintain support for his war on terrorism, if we have these obvious pitfalls coming out of Afghanistan?
ALEXIS SIMENDINGER, NATIONAL JOURNAL: Well, I think the most obvious thing is the relationship that the president of the United States has been trying to maintain with Karzai, the acting president of Afghanistan, and the concern the administration has coming on the heels of apologizing, for instance, for U.S. accidental bombing, and the concern about maintaining security in Afghanistan, as well as our own activities.
And I think the president had already, earlier this week, talked to Mr. Karzai to apologize, and also will be, I'm sure, talking about security, maintaining security and trying to maintain some kind of stability there in whatever way the United States can with forces on the ground.
KARL: And of course, this comes out as we saw the New York Times reporting these rather detailed plans for a massive invasion of Iraq, no timeline set, but 250,000 U.S. troops.
ALLEN: There's a big multi-tasking issue coming up here for the president as the war on terrorism goes ahead, because this assassination today is a reminder of what the president has been saying, which is, "We're not done in Afghanistan and are not going to be for a long time."
Your viewers heard during his radio address saying that there's 60,000 people already deployed around the world. As you point out, with Iraq, much bigger, much higher risks. The war on terrorism pretty -- so far, has been pretty low causality, low cost for the military. In Iraq, we can't count on that.
KARL: So here we are. We're -- you know, obvious, major challenges remain in Afghanistan. We've got the no progress at all in the Middle East, and in discussions of a massive invasion of Iraq.
I mean, Jill, you're up on Capital Hill. Is he going to have the support? Is the president going to have the support?
JILL ZUCKMAN, CHICAGO TRIBUNE: Well, I think he's got the overall support, but I think it's very wide and maybe not all that deep. And I think some of these things, with the assassination, the accidental bombing, it just provides little openings for more criticism.
I mean, the criticism of President Bush has been ramping up over the last few weeks. And, you know, in the beginning, it was -- he had total support. The Democrats were constantly saying, "There's no sunshine between us. We're shoulder to shoulder." And now, they're starting to feel like it's OK for them to say, you know, "Hey, we have other ideas, and maybe you don't have all of the answers."
SIMENDINGER: Well, what kind of progress are we making? I mean, you hear Democrats start to ask that question, which they weren't doing a couple of months ago.
ZUCKMAN: Exactly.
KARL: All right, we've got to take a quick break. I want to talk more about this, but also about the president's controversial stock sales -- and, Mike Allen, you've been at the front of that story, his stock sales of Harken Energy back in 1990 -- and some of the political fallout of this WorldCom scandal, when we come back with our reporters roundtable.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
BUSH: The anniversary of America's independence is a day for gratitude and a day for celebration. On the Fourth of July, we count our blessings, and there are so many to count.
(END VIDEO CLIP)
KARL: President Bush leading the Fourth of July festivities in West Virginia this week.
Welcome back to our reporters roundtable. Now, I want to get right to the latest approval numbers for the president. Let's take a look. This is the latest CNN-USA Today Gallup poll, and it shows still a 76 percent approval rating for the president.
Now, Kelly, with us in Kennebunkport, the top pollster for the RNC came out, what, two months ago or more and predicted that the president's numbers were going to come down. What's going on, and what are thinking about this?
WALLACE: Well, clearly, Jonathan, they're thrilled, of course, thrilled to see that number remain as high as it is, believing that will definitely, definitely help Republicans in November.
What is interesting, though, is to look at other polls, when you look at particularly issues such as the handling of the economy. The president's numbers dropping a little bit, and obviously that's a big concern right now. In terms of who is more closely tied to corporations and who will do more to fix some of the concerns, the Wall Street scandals, Democrats faring better than the Republicans and the president.
So while White House officials certainly thrilled about this high number, they're looking at those other numbers and are definitely concerned and want the president to be viewed as doing enough, particularly on the economy.
KARL: But, Alexis, you would never have predicted this number to be this high at this point would you?
SIMENDINGER: Oh, it's really unprecedented. And as you point out, members of the president's own party were predicting that what goes up must come down eventually. They weren't quite sure when and how. With the economy so slow, now we think that, you know, there may be even a slower recovery than the administration had hoped.
There still is a lot of concern about what will happen with the numbers, as Kelly pointed out, especially with the economy, or on domestic policy.
KARL: And we have this Harken Energy situation. And I want to, before we talk about this -- and, Mike, you've been at the front of reporting a lot of this -- Ari Fleischer trying to explain these controversial stock sales that the president made back in 1990, '91. Let's take a look at what Ari Fleischer had to say.
(BEGIN VIDEO CLIP)
ARI FLEISCHER, WHITE HOUSE PRESS SECRETARY: The president believed that all of the forms were filled out properly by the attorneys and filed with the SEC because he knew that he filed his form with the SEC. And then, turned out to be a mix-up with the attorneys where the Form 4s were not filed, and we were able to ascertain that this week.
(END VIDEO CLIP) KARL: OK, so we learn that it took 34 weeks for the president to file these forms about these stock sales. He was on the board of this company. He sold the shares before this bad news came out and the shares dropped. Democrats whispering, "insider trading, insider trading. This is exactly the kind of stuff that's the problem."
Mike, what's the feeling at the White House about this?
ALLEN: Well, the president not just on the board, he was on the audit committee...
KARL: On the audit committee...
ALLEN: ... of this corporation. And, you know, the White House says to us, "Oh, only the executive committee knew," et cetera. But one part of the president's message to executives in recent days has been, "Ignorance is no excuse." And yet this is a case where he said he didn't have a lot of important information about upcoming losses by his company.
Vice President Cheney, when he was chairman of Halliburton, the Texas oil company, they made a major change in their accounting method. It's been called aggressive, which I think is great. It's a euphemism for something, but the more aggressive accounting method, Halliburton telling flus, "Oh, that was done in the financial group. The accountants did that. He wasn't a hands-on CEO."
So...
KARL: I mean, the responsibility, corporate responsibility. Democrats are having a field say, come on.
ZUCKMAN: Democrats are so excited about this issue. They're so excited that they've even put it ahead of prescription drugs when the Senate comes back from the Fourth of July recess, because they think that they've got a lot of ground that they can gain.
They don't think the president has a lot of credibility when he comes out and talks about maybe some regulations on business because, you know, he's a businessman and he doesn't like regulations.
And they also think that this ties in so intricately with the economy. People see that their 401(k) retirement plans are going down, not up. They're worried about the future. And the economy is not getting that much better. And it's all part of the same thing.
KARL: And yet Stanley Greenberg, you know, pre-eminent Democratic pollster, in his poll last week actually showed that -- I mean, this is a Democratic poll -- that Republicans still have a slight edge in the polls over who Americans trust to run the economy.
SIMENDINGER: Well, in the case with the president and the administration, there's a lot of public support that trickles down from his control and his authority over the war. For instance, they like the team Bush approach.
But what the president is going to be doing this week is give a big speech in New York about corporate responsibility.
He's going to try to inoculate himself on Tuesday with this idea that it's not just business as usual, you can't get away with it and then just pay a fine.
And of course Democrats, as Jill is saying, are going to try to make this stick to the president. But I think it's going to be tough to do, particularly since it's a 12-year old incident, case, that's still being explained. But it's hard for the public to wrap their mind around it, I think.
KARL: Kelly?
WALLACE: And you know, I just want to jump in, Alexis. You know, it might be tough to stick it to the president, but you know, it might not be so difficult to see some Republicans face damage because of it, because again, when you look at some of these recent polls, when the American people are asked, "Who do they trust more to fix the so-called corporate scandals going on on Wall Street," they seem to trust Democrats more than Republicans and then the president.
So the president might be OK, but Republicans, if this really becomes a key issue going into November, Republicans could potentially lose in the mid-term elections.
KARL: Well, Mike, the president seemed angry when he was asked about this, when he was asked about these stock sales.
ALLEN: Yes...
KARL: You know, "Next question." I mean, what...
ALLEN: Right. The president said, "That's been vetted. That's been looked in to." And this is the White House's response on a lot of things, "This has been looked in to."
But these details coming out really present the White House with a "Do as I say, not as I do" problem.
Democrats, as they prepare to respond to the president's speech on Tuesday, plan to emphasize that this administration just doesn't have credibility on this issue unless it makes some more fundamental changes. Democrats are going to ask for them to make changes in his economic team, take the former Enron consultants, the former Enron executives off of his economic team, team of advisers.
KARL: There won't be much left.
ALLEN: The president plans to propose a number of very aggressive proposals, as Alexis mentioned, more criminal penalties. Democrats are saying, "Welcome to the party." They have been proposing a number of these things. The White has been fighting these things on Capital Hill.
KARL: OK. Look, we only have about a minute left, and I wanted to get to another great political story from earlier in the week. Al Gore coming out and saying to a group of his supporters that if he had it all to do over again in his run for the president, he would just basically not listen to all of those high-paid consultants that were on his staff, and let it rip. I mean, what's going on?
ZUCKMAN: Well, it was a great line for about 10 seconds, and then the air just went out of it. And everybody said, "Hello, you know, who are you? You were out there, you were the one talking. You messed up at the debates. You know, you have a lot of responsibility. You were micro-managing your campaign. You had a lot to do with this."
KARL: But Gore does seem to be gearing up, right?
SIMENDINGER: Oh, definitely.
ALLEN: He's reinventing. And that means...
(LAUGHTER)
... you know he's gearing up, right?
SIMENDINGER: Exactly. If we're about to see yet another Gore...
ALLEN: Or is it...
KARL: Kelly, we have a few seconds, what have you got?
WALLACE: You guys, no, I was just going to say James Carville, one of the fiercest defenders of Vice President Gore, former Vice President Gore and Bill Clinton, he was criticizing Al Gore's comments, saying, "Come on, you can't blame the consultants. Look at yourself." So that says a lot just right in that -- Jonathan.
KARL: Gearing up for rematch at the White House.
Thank you very much, all of you, Alexis, Kelly, Mike, Jill. I appreciate it coming in on a Fourth of July weekend.
ALLEN: Have a good weekend.
KARL: Take care. Have a great rest of the weekend.
All right, a news alert is next, and then People in the News has the inside story on Martha Stewart and actor Will Smith.
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