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Interview with Terry McAuliffe, Marc Racicot

Aired January 30, 2002 - 19:30   ET


BILL PRESS, CO-HOST: Tonight the chairman of the Republican and Democratic parties square off on the state of the union. Congress taking the White House to court. And Al Gore's come back?

ANNOUNCER: Live from Washington, CROSSFIRE. On the left, Bill Press. On the right, Tucker Carlson. In the crossfire, Democratic National Committee Chairman Terry McAuliffe and Republican National Committee Chairman Marc Racicot.

PRESS: Time for CROSSFIRE. Thank you for joining us. Last night they came, they listened, they applauded the president's state of the union. Today, members of Congress went out and started scrapping over it. Republicans praised every word. Democrats praised the war part, but then parted company on the economy.

And after basking in last night's bipartisan glow, President Bush woke up this morning to cold reality. The General Accounting Office announcing it would sue the White House over Bush and Cheney's refusals to surrender those records of the Administration's Energy Task Force.

The stage is set for battle. The commanding generals are armed and ready. And here tonight for the Republicans, Chairman Marc Racicot. For the Democrats, Chairman Terry McAuliffe. Ready, aim, fire.


TUCKER CARLSON, CO-HOST: Terry McAuliffe, welcome to CROSSFIRE.


CARLSON: On this, the anniversary of Dick Cheney's birth. Perhaps you'd like to wish the vice president happy birthday.

MCAULIFFE: Yes, happy 61.

CARLSON: Thank you.

MCAULIFFE: He's looking good for 61.

CARLSON: He looks fabulous. Now I have to say the Democrats, it turns out, are taking a sensible, reasonable stand on Enron. I want you to let them speak for themselves. This is Tom Daschle and Joe Lieberman.


SEN TOM DASCHLE (D), MAJORITY LEADER: The last thing we should do is politicize this scandal.

SEN JOSEPH LIEBERMAN (D), CONNECTICUT: The worst thing that any of us could do, who are involved in these investigations, is to try to politicize them.


CARLSON: Now that's a sensible point of view, I think you'd agree. But yet, there's a problem, a credibility problem. It turns out that the other day the Democratic brain trust, James Carville, Stan Greenberg and Bob Shrum released this. And this is a memo outlining how Democrats can do that, politicize Enron. Democrats have a credibility problem on Enron, do they not? And this proves it?

MCAULIFFE: Well, I haven't seen the memo. It's the first I heard about it. If you think I can control James Carville, you've got another thing coming. I can't speak to that. He's an independent. He's a great Democrat. He's always out there fighting, but I don't know about the memo.

And we don't want to politicize Enron. There are some issues that have to be answered, Tucker. We want to have some disclosure on the issues. We wish the vice president would release the documents from his meetings, but it's not a political issue. Thousands of people lost their 401Ks. This is a very serious issue. We need to get the facts out. And it's early. There are 12 congressional committees going on right now, but there are a lot of questions because we haven't had full disclosure.

CARLSON: Interesting. That is very sensible -- I mean, I'm not sure I could disagree with a single word you just uttered. And yet, that's not what Democrats are really saying, as you know. And I just want to quote for you. This is a memo.


CARLSON: And I'm sorry you haven't heard of it because you must be the only Democrat in Washington who hasn't. These are not just random activists. These are people who, as I said, are the brain trust of your party, the memo tarnishing Bush's policy initiatives. Enron is going to destroy/discredit his energy policy, his Social Security reforms, his position on the budget, taxes, the economy in general. This is the plan Democrats have going into mid-terms, isn't it? Leverage Enron as a campaign issue?

MCAULIFFE: We have a lot of people out there involved in campaigns. As you know, Mr. Luntz did a memo at the end of last year, encouraging people to go after Tom Daschle. A conservative group did ads in South Dakota attacking Tom Daschle, comparing him to Saddam Hussein.

So it's going on both sides out there, Tucker. I mean, Senator Daschle would like to put out good legislation out there. And he's been violently attacked out there for it. And I don't know if you want to see today. We've asked the vice president to come out and say those ads were wrong. I'd ask you right now, Tucker, were those ads wrong that they ran against Tom Daschle?

CARLSON: I thought they were terrific. I liked every one of them.

PRESS: There you go. So much for the bipartisanship.

Mr. Chairman, welcome. History was made today. For the first time in history, the investigative arm of Congress, the General Accounting Office said it's going to have to sue the Bush White House because George Bush and Dick Cheney still refuse to release the records of the meetings of the Energy Task Force.

The Republicans are all over the place on this thing. The ranking senator on the government affairs committee, Fred Thompson, has told the White House, "Let's get everything out and get it over with."

I ask you, Mr. Chairman, echoes of Richard Nixon. Why is George Bush stonewalling on this issue?

MARC RACICOT, RNC CHAIRMAN: Well, Bill, that would be a substantial exaggeration in my judgment. The fact of the matter is, you're talking about a privilege here that's very important to the functioning of the presidency. And both the president and the vice president have taken the position they have, as a matter of principle, long before there was ever any discussion about Enron.

Just like we have privileges that attend to the communications of attorney and client, for doctor and patient, or husband and wife, this is a privilege that's been recognized for a long period of time, that allows for the president to receive the unvarnished counsel and advice of those that he serves, in an effort to be able to serve the people of this country well. So they stuck up for that principle from the very beginning.

PRESS: It's so familiar, because Hillary Clinton and Bill Clinton made that same argument about how her healthcare task force. And they finally realized they were wrong and they finally released the documents, but here's what they're asking. Here's what the GAO is asking, Mr. Chairman. The names of the people they met with, the dates they met, what they talked about, not the minutes, not every word, just what was on the agenda, the location of the meeting, and how much it cost. Are you saying the American people don't have a right to know that? These are not internal White House discussions. These are without representatives of outside organizations, just that information. Come on.

RACICOT: Well, there certainly have been instances in the past, Bill, where people have accommodated themselves because it was a path of least resistance. This president said very early on, in terms of communications that apply to Bill Clinton as a matter of fact, that he was going to defend executive privilege at every point in time. That's precisely what they've talked about long before there was ever any discussion about Enron. And that's the principle they seek to vindicate.

MCAULIFFE: I think the energy policy is so important, I think they ought to release the minutes from these meetings. I mean, energy policies affects what everybody pays for heating at home, what they pay for their cooling. It affects every American. Energy policy should not be done in secret. We as Americans, it's our energy policy. It's not the vice president's energy policy. This is what we pay for our energy. Let's just put it out on the table (INAUDIBLE).

CARLSON: But just to correct, just sort of an obvious misrepresentation. As you know...

MCAULIFFE: (INAUDIBLE) the governor.

CARLSON: Actually by you, because as you know the energy policy is open for everyone to read. It's the deliberations.

MCAULIFFE: It's on the Internet.

CARLSON: The historical -- that's exactly right. If wanted the energy policy of the executive branch, you can look it up right now.

PRESS: Names, dates, agenda, location.

CARLSON: The policy, which is the people's policy, is available to people. But I know you'd rather talk about the energy policy.

MCAULIFFE: No, no, no, but let me ask one thing. There have been some serious questions raised about 17 specific proposals put into the energy bill to help Enron. Now if that's the case, we ought to just get it in the open, make a decision, so that we can move on and not have that sitting out there, if that's an issue.

CARLSON: No, as you know, the proposal's there for people to judge themselves. But let me ask you this.

MCAULIFFE: Yes, sir.

CARLSON: Last night, the president's state of the union address, mostly about foreign policy. And afterwards Democrats, including you, but including Daschle and Gephardt got out and said we agree with the president on foreign policy. They really couldn't do anything else because the public agrees with the president.

But that's not true, really. They don't agree. Both of them, Daschle and Gephardt are on record unequivocally saying we don't support going in and taking out Saddam Hussein. Now the public supports it. They don't support it. Aren't they misrepresenting their position when they say they agree with the president's views on the war against terror? MCAULIFFE: Listen, first of all, we have all come together. Last night was a great night of unity. We all stood and applauded as one, Tucker. You cannot divide us on this war on terrorism. Every speech that I give, I begin by praising our president and the outstanding job that he is doing fighting the war on terrorism. We do have differences on the domestic agenda, principle difference.

CARLSON: But you have differences on the foreign policy agenda. And pretending they're not there doesn't make them not there. Daschle, Gephardt have both said we don't agree with taking out Saddam Hussein. Bush, in his speech last night, suggested we might do just that. So they're pretending they agree, but they don't, really.

MCAULIFFE: But this was a speech that he gave last night. He talked about the axis of evil. This was the first we had heard about this. I think we had need to look at this. We talk about going into nations, Iraq, and Iran, and North Korea.

As you know, they were stunned today. They complained bitterly today that they were put on these different lists. I think the president gave a speech from 9:00 to 10:00 last night. We ought to have time to analyze what the president said as it relates to foreign policy. This is policy that affects all Americans and all freedom- loving people.

PRESS: Chairman Racicot, there were two words missing last night from the speech. I want to ask you about both of them.

First, the "E" word The president never mentioned Enron, even though it's what everybody is talking about, OK? But he claim close. I mean, he alluded to it. Everybody knew what he was talking about when he talked about corporate wrongdoing. Here's the president last night.


GEORGE W, BUSH, PRESIDENT OF THE UNITED STATES: Through stricter accounting standards and tougher disclosure requirements, corporate America must be made more accountable to employees and shareholders and held to the highest standards of conduct.


PRESS: Good speech, good line. But what maybe a lot of people don't realize is that was already done. It was done by President Bill Clinton, who passed an executive order, saying that companies that were guilty of criminal conduct should be banned from federal contacts. And one of the first things that George Bush did when he took office was he rescinded that executive order, letting criminal corporations like Enron run wild. Mr. Chairman, Bill Clinton was right. George Bush was wrong.

RACICOT: No, President Bush was very right because he's the first one...

PRESS: By rescinding that order? RACICOT: No, no, no, listen. Hear me out now, Bill.

He was very right because he was the first one on the planet that says there needs to be an appropriate investigation. And he ordered two executive branch agencies to do precisely that.

You know, the efforts to try and politicize this, I think, run contrary to the instincts of the American people about how we conduct appropriate inquiries in this nation. We need to determine the facts, just as Chairman McAuliffe has indicated, we need to let those facts fall where they may, and then appropriate regulatory or criminal conduct, if it's alleged and proved needs to be sanctioned appropriately. But this notion that somehow there is an opportunity here to politicize this, I think, meets with great disdain all across the land.

PRESS: Just for the record, I'm all for politicizing Enron. (UNINTELLIGIBLE) it goes right to the Oval Office. But I want to ask you about the other missing words.


PRESS: Which is, the other missing word is the "O" word. You know, four months ago, our number one target was getting Osama bin Laden. Last night he was never mentioned in the speech. Neither was the other "O," Mullah Omar. So we actually failed, didn't we, in our number one goal, to get Osama bin Laden?

RACICOT: I don't think there was ever any indication given that we would know precisely when or where that arrest or that confinement would be able to be consummated. You know that as well as I do. And the American people know that as well. The fact of the matter, that his name may not have been mentioned.

PRESS: We don't even talk about him anymore.

RACICOT: I mean, it's irrevocably clear, Bill. There's no debate over that.

CARLSON: Well, that's going to have to be a future show. Mr. party chairmen, we'll return in just a moment. And when we return, we'll bring back a riddle. What's bearded and raising money? That's right, a former presidential candidate you may recognize. He's back and we'll be back too in just a moment.


CARLSON: Welcome back to CROSSFIRE. We've been talking politics and scandal. Now we shift to our guests themselves, who as it happens, are both part of this week's news.

On the left tonight, Terry McAuliffe, chairman of the Democratic National Committee. Mr. McAuliffe once acted as a liaison between a politician and the chairman of a powerful company. That company is now bankrupt. Mr. McAuliffe made millions. Sound like another Enron? That's what Republicans are saying. And on the right, Governor Marc Racicot was chairman of the Republican National Committee. That's not Mr. Racicot's only job. He is also an employee of a Washington law firm that does extensive lobbying on dozens of issues. An obvious conflict of interest? That's the Democratic line. So let them answer for themselves.

Bill Press?

PRESS: Let's get into that. Mr. Chairman, when you first took the job as Republican National Chairman, you at the beginning, were also going don't serve as lobbyist and chairman. There was a lot of criticism. To your credit, I believe, you had said I'm not going to do any lobbying. I'm just going to be the chairman, but you also remained on the payroll of the law firm, which is Bracewell and Patterson.

I have a list here of the clients of the firm. There are some 44 companies on the list. Enron's no longer on the list, but it still includes the chemical manufacturing association, Integrated Waste Services, National Cable TV Association, for which we thank you, Shell Oil Company and a lot of others. I mean, doesn't that, in fact, represent a huge conflict of interest? These guys are paying your salary.

RACICOT: Well, I don't think that that's anywhere near the case.

Here's the bottom line. The fact is I'm a lawyer, and I've practiced law for a long period of time. I had a two-year obligation with this firm that I reached agreement with a year ago. This opportunity to serve came up very unexpectedly. And of course, what we were contemplating at the beginning is entirely appropriate in terms of the legal parameters that are set.

But as I thought about it, it appeared to me that it was a wise choice to make, to eliminate any possibility of any kind of appearance or potential conflict of any kind whatsoever. So as a consequence of that, I decided that I simply was not going to be engaged in contacting federal employees that are covered by the Lobbyist Disclosure Act or Members of Congress, presenting any kind of an argument or cause before them when they're reaching policy determinations. And then I would proceed to dedicate myself to the activities of the Republican National Committee, but let me finish here.

The bottom line is that there are some continuing responsibilities that I have to clients that are entirely private. And they concern some people in Montana and other places that have absolutely nothing to do with the definition of lobbying, as all of you know it, in the confines of Washington, D.C. And I need to fulfill those obligations.

PRESS: Well, I think it's clear that you're not going serve as a lobbyist, but I mean -- and you know in this town, I think in any capital, it's important to avoid not just wrongdoing but the appearance of wrongdoing.


PRESS: And Mr. Chairman, but you're out there and you're still, again, all of these companies and they may have legitimate interests, but they all have interests in front of Congress. They have interests in front of the White House. And you are the head of the Republican party. And they're paying your salary. You don't see anything wrong with that?

RACICOT: Bill, I'm representing both private clients that have absolutely nothing to do, as I represent them, with activities that are covered by the Lobbyist Disclosure Act. And the fact of the matter is, I believe that that's the end of the story. I mean all of us are volunteers in some fashion. Every member of the Republican National Committee is a volunteer serving on that committee. We're all engaged in the political activities of this country in a way that we believe is constructive and positive. That's precisely what I'm going to be doing.

CARLSON: Now Terry McAuliffe, Global Crossing, big company went bankrupt this week, fourth biggest bankruptcy in American history. Some years ago, you invested $100,000, got $18 million in return.

This became a news story. You were asked about it on CNN by Paula Zahn. I want to read some of the things you said about Global Crossing. I'm quoting you now. "It's a great success story. You try to make money. I made money. That was a very good company, a great investment. I'm very happy with it. I probably sold it a little early. I could have made some more money."


CARLSON: It's a great success story.

MCAULIFFE: When I bought the stock...

CARLSON: Enron is a great success story for Ken Lay. For those of you, the rich guys who can walk away from the company with millions, it's a success story. For the thousands of other people, investors and employees who are shafted by a company that goes bankrupt, it's not. You want to reconsider those words?

MCAULIFFE: I didn't work for Global Crossing. I was not on their board. I did not do any work for them. I was not a lobbyist. I was not a consultant. I was never an employee. I was a shareholder. I bought shares of stock, just like millions of other people did, including former President George Bush was a fellow shareholder of mine, who bought at around the same time I did.

I sold my stock, as I do with many other stocks. I invest in start-up companies. That was my business. I sold all my shares when I thought my stockbroker thought it was right. I buy shares, I sell shares. That's the business.

I feel bad for everybody who lost their money in Global Crossing. Investors, shareholders. I lost on many different high tech companies that I have invested in. I make some money on some, I lose some on others, but it was a very good idea, a fiber optic undersea cable. They grew to be a $55 billion market cap company. I had nothing to do with the management. I own shares. Like I said, I buy and sell stocks.

CARLSON: I've got many more questions, but we're running out of time.


CARLSON: So we have to get to my favorite question of the evening. Al Gore, kicking off a new campaign for president, it looks like. This is your worst nightmare, isn't it? This guy is a bearded political kamikaze, who's going to wreck your party.

Now let me give you one indication of how everybody in the Democratic party knows this is going to be a disaster are his staff. He's assembling a new staff. Guess who's not on it? Bob Shrum, Donna Brazille, Carter Eskew. The stars of his previous campaign, they're nowhere near the campaign, because like you, they recognize this ship is doomed from the moment it leaves port. Correct?

MCAULIFFE: You know...

CARLSON: You know it is. Just come on, admit it.

MCAULIFFE: You live in a fantasy world. Listen, Al Gore started up his pact to help '02 candidates. I've talked to him about it. It's '02, now '04. He has made no decision about...

CARLSON: Are you reassuring us?

MCAULIFFE: ...about his future about '04. But you got to understand one thing, Tucker, I know it's hard for you to realize this. Al Gore got 52 million votes for president of the United States in the year 2000. He actually got more votes than President Bush did. That's a fact you have to live with until you die.

CARLSON: I'm sure it'll help him two years from now.

PRESS: Mr. Chairman, we don't have a lot of time. My thought is to like to ask you one think about Global Crossing. Terry McAuliffe invested in the company. The company went wild. The stock went way up. He sold his shares. He made a good profit. Did he do anything wrong?

RACICOT: I know of absolutely nothing that he did wrong. You know, that's one of the things that causes me pause about our political affairs these days, is that by insinuation or some kind of innuendo, just because you want to win on a given day, you suggest things that are not supported by the evidence or that you don't believe to be true.

What I know is what Terry McAuliffe has said. And I accept it at face value in the way that he's offered it. And I have no further questions. PRESS: I have not seen you raise the issue. I have seen a lot of conservatives or Republicans raising this issue. Rush Limbaugh spent like three hours on it yesterday. Do you think people are wrong to use this issue against Terry McAuliffe?

RACICOT: I think people are wrong on both sides of both these questions, because in my understanding of what Americans expect. They expect evidence and information and facts to be presented from which they can draw conclusive judgments. I think that ought to apply whether it applies to me or to Terry McAuliffe.

PRESS: Mr. Chairmen.

CARLSON: Here, here.

PRESS: It's the beginning of the battle. Thank you for starting it here tonight. We look forward seeing you many times here on CROSSFIRE from now on, all the way through 2004. Thank you.

And when we come back, you may remember last night Bob Novak and I made some wild guesses on how long the speech would be and other weighty matters. So did Tucker Carlson. So tonight we'll tell you who was the most clairvoyant. Get ready. And the answer is.


PRESS: OK. Last night you may remember we had kind of a CROSSFIRE office pool. Bob, Tucker and I took some wild bets on the most important parts of the state of the union. Let's see how we did. The first question was, how long's the speech going to be?

Well, I said 61 minutes. Bob said 45 minutes. Tucker's guess was 51 minutes. And the answer is 48 minutes. Yes, that's our final answer. What do you think, Tucker? You and Bob were close.

CARLSON: I think, Bill, that after years of Bill Clinton, it's hard for you to conceive of a president who can give a short, pithy speech. 61 minutes, that would've been too long.

PRESS: No, I just expected more and got less, which is what I usually get from George Bush.

CARLSON: OK, oh, well, if you low balled there, you over balled, if that's the word, on interrupted by applause. How many times would he be? Bill, perhaps hoping the president would be drowned out by Congress, guessed 119 times. Bob Novak guessed 40 times. I presciently guessed 70 times because in fact the answer is 77 times the president was interrupted by the floor.

PRESS: But you didn't win. Bush lost. Again, I thought he was going say something worth applauding and people would really be applauding. Instead, it was like yesterday's leftovers.

CARLSON: That is actually -- you must not have been watching. People were sitting captivated in rapt attention. They didn't want to wreck it by applauding. PRESS: You're talking about Clinton's last speech. All right, now the last question was, who's the lucky member who gets to stay home from the speech?

Well, I guessed Paul O'Neill, Secretary of Treasury. Bob's guess was Don Evans, Commerce. And Tucker's guess was Norm Mineta. Let's see how we did. The answer is well, nobody came close, Gail Norton, Interior Secretary. But you know what's scary about that, Tucker, had there been some calamity, Gail Norton running the country?

CARLSON: See, I thought the question was cabinet member would the least be missed were he not to show up. So I guessed Norm Mineta naturally. But I turned out to be wrong. And I think Gail Norton would be a terrific head of state.

PRESS: That's why I guess Paul O'Neill. All right, from the left, I'm Bill Press. Thanks for being with us. Good-night for CROSSFIRE.

CARLSON: And from the right, I'm Tucker Carlson. Join us again tomorrow night for yet another edition of CROSSFIRE. See you then.




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