Skip to main content /TRANSCRIPTS



Prescription Drug Plans Fall Short in Congress; James Traficant Expulsion Hits Snag

Aired July 23, 2002 - 16:00   ET


JUDY WOODRUFF, CNN ANCHOR: I'm Judy Woodruff in Washington. The Senate votes on prescription drug benefits for seniors, but the two competing plans each come up short.

JONATHAN KARL, CNN CONGRESSIONAL CORRESPONDENT: I'm Jonathan Karl on the Capitol subway where I spoke with a top Republican who thinks both the leading prescription drug plans would bust the budget.

WILLIAM SCHNEIDER, CNN SR. POLITICAL ANALYST: I'm Bill Schneider. Some critics say a prescription benefit is too expensive. But the cost of political failure now could rise even higher in November.

KATE SNOW, CNN CONGRESSIONAL CORRESPONDENT: I'm Kate Snow on Capitol Hill. The vote to expel Congressman Jim Traficant hits a snag. I will tell what you happened back in Ohio that almost shook things up here in Washington.

WOODRUFF: Thank you for joining us.

One of the hottest issues in the last election and possibly the next one as well, arrived front and center today on the floor of the U.S. Senate. Members considered two competing prescription drug plans, but neither side could muster the 60 votes that are required for passage.

The plan favored by Democrats received 52 votes. It would have cost almost $600 billion over 10 years. The government would have administered the benefits through the Medicare program. A separate plan offered by Republicans, some Democrats, and the Senate's loan independent received 48 votes. Now, this plan would have cost about $370 billion over the same period. This proposal would have relied on private insurers to deliver prescription drug benefits.

For more on the vote and the pressure on lawmakers to reach a deal, let's turn to our Jonathan Karl at the Capitol. Jonathan, they just voted, where do they go now?

KARL: Well, Senator Daschle, the top Democrat of course here in the Senate, just came out a few minutes ago, flanked by the sponsors of that Democratic bill and he said, quote, we're back to the drawing board. Democrats are going to go back now and they're going to try to strike a compromise. They know they got 52 votes. They need 61 so their goal now is to peel off nine Republicans to get them to support something of a compromise, something that would be less expensive than the Democratic bill but offer more than that tripartisan or that Republican bill that also went down.

But here's the situation, Judy. Virtually every Republican up here with the exception of just a couple say they think they went as expensive as they could with that $370 billion Republican alternative. They think there is no compromising beyond that. That makes the outlook here for some kind of a deal very, very remote and furthermore, Republicans have the exact opposite idea of how to compromise here. They think the thing to do is simply pass something that would help low income seniors, something much more modest, something much less expensive but something that would at least provide some effort for the poorest seniors who can't afford their prescription drugs.

WOODRUFF: Jonathan, one of the most powerful groups up there that works the hill, the AARP, the American Association of Retired People. You've been talking to them. What are they telling you the stakes are here?

KARL: Well, John Rother of the AARP, they of course have endorsed the Democratic bill. They're in favor of that, but they have a very different view of this than some Democrats. Some Democrats believe that even if they lose on this they can go back and campaign on this issue and score points against Republicans in the November election.

But Rother's message, the message of the AARP is that Democrats are on the line here. Democrats year after year have promised to produce a prescription drug benefit. They control the Senate. They must produce something, even if it's something more modest, even if it's not everything that the AARP wants. They want them to do something, even if it is something simply to help low income seniors, but something must pass in the view of the AARP. They think Democrats are wrong if they think they'll go back in November to campaign on this thing as an issue instead of actually as an accomplishment.

WOODRUFF: All right. Thank you, Jon.

Our Bill Schneider joins me now with more on potential political costs to lawmakers in November if they can't come up with a deal.

SCHNEIDER: Well, the question is, who pays, not for the drugs, for the broken promise.


(voice-over): In 2000, both parties made the same promise to seniors.

AL GORE, FORMER VICE PRESIDENT: I will pass a prescription drug benefit for seniors under the Medicare program. And together we will make that happen.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Prescription drugs for seniors is going to be a priority, not only a priority, we're going to get something done.

SCHNEIDER: What happens now that both parties have broken their promise? We know three things about seniors. One, they vote especially in mid term elections when other people don't vote. Two, they swing. In 1998, the senior vote allowed Republicans to keep control of the House. In 2000, the senior vote nearly turned the House over to Democrats. Three, they care about issues that effect them.

Among all voters polled last month, the top two issues were the economy, and terrorism. Among seniors, the top two issues were Social Security and prescription drug coverage. If angry seniors now feel betrayed, who will they take it out on? Republicans say, we've delivered. The Democrats haven't.

SEN. TRENT LOTT (R-MS), MINORITY LEADER: The House has acted. The Senate needs to produce a result.

SCHNEIDER: Democrats say they have greater credibility on the issue and polls back them up. They also show Democratic voters care about the issue more than Republican voters do. Angry Democrats are more likely to come out and vote on prescription drugs while nervous Republican lawmakers seek cover. What difference can an election make? Just listen to this old-timer.

SEN. EDWARD KENNEDY (D), MASSACHUSETTS: In 1964, I was here in the United States Senate when we had the great debate on Medicare and in that year, the debate was lost. And about seven months later, with the new Congress, we came back in 1965 and we passed Medicare. The major intervening event was an election.


SCHNEIDER: Seniors were around then. They remember. That's what Democrats are counting on.

WOODRUFF: Thank you, Bill.

Outside Washington, and closer to home, prescription drugs are already an issue in several Senate races around the country. In North Carolina, Republican Elizabeth Dole is running an ad touting her support for a prescription drug benefit. The ad even features her 101-year-old mother.

In Maine, Democrat Chellie Pingree is challenging Republican Susan Collins. Pingree is running a TV ad promoting her past work in the state Senate to lower the cost of prescription drugs. And South Dakota Republican John Thune is using the prescription drug issue in his race against the incumbent Tim Johnson. Like Elizabeth Dole and with a nod towards his target audience, Thune chose his parents to be the featured subjects in his ad.

Here in Washington, the vote to expel Congressman James Traficant is on schedule, but that doesn't mean the drama is over in he case of the flamboyant congressman. For the latest, let's turn to our congressional correspondent Kate Snow. Hi, Kate.

SNOW: Hi, Judy. Well, let's start with the headline. The headline now, sources telling CNN, that now as of about an hour ago, they do plan to go ahead with a vote to expel Jim Traficant sometime this week. That after a day of jockeying, of talking about delaying this vote. For a time, it looked like they waited until after the August recess to consider the expulsion of Jim Traficant.

It all goes back to last week. There was a witness during the House Ethics panel investigation that Jim Traficant called. His name is Richard Detour (ph). He told members last week that he was pressured by prosecutors to lie about things that Traficant had done and things he had said. It is important because this man, Mr. Detour, never appeared at the criminal trial in Cleveland last spring. This was the first time anyone had heard from him.

It's over the weekend a juror back in Ohio who had served on that very jury that tried Jim Traficant, in fact found him guilty on all counts. A juror told the people there, a Cleveland paper, that he thought he might reconsider had he known about that testimony that you just saw mentioned there. He said it might have raised some doubts in his head about convicting Mr. Traficant. Republican Congressman Steve LaTourette picked on that and also reports that there might even be a second juror who had some doubts. He went to Speaker Dennis Hastert today and said, let's hold off.


REP. STEVE LATOURETTE (R), OHIO: What's unusual in this case, you combine it with Richard Detour's testimony who couldn't testify at Traficant's trial because he is under indictment facing trial in November himself, together with one juror who comes forward, and now a second juror who comes forward and is I think saying the same thing. It begins to make you think, wait a minute, not necessarily that anybody has made a mistake. But likewise, I don't think the future of the republic is at stake if we don't act on this thing tomorrow.


SNOW: LaTourette said he simply wanted to be sure they didn't make a mistake by moving ahead too quickly, wanted to let the process run itself out. But when Republicans started talking about that, Judy, and talking about delaying, they also talked about the schedule being so full this week, they have a lot on their plate.

When they started talking about that, Democrats bounced back, jumped all over it, said, no, no, no, we don't want a convicted felon serving in Congress. They decided they'd make some political hay out of it. They were going to go ahead and provide their own motion today, force the issue onto the floor. When Republicans heard that, they say well, as we said the at the beginning, now they probably will go ahead with this vote sometime this week -- Judy.

WOODRUFF: I guess we all knew Congressman Traficant was not going to go quietly. All right, thanks, Kate. When we return, our focus to prescription drugs. Next, I'll interview Senator Kennedy and Senator Chuck Hagel joining Jon Karl on our subway series.

Also ahead, a leading man shows his softer side. Why Bruce Willis made a White House appearance.

Two years out from the next party convention, Jeff Greenfield considers how the world has changed since the last time the parties anointed their nominees. But first, the human side of the prescription debate.

REA BLAKEY, CNN MEDICAL CORRESPONDENT: I'm Rea Blakey in Washington. How would you survive if the cost of your monthly prescriptions was nearly 1/4 of your monthly income? We'll meet a man trying to cope.


WOODRUFF: For many Americans, finding ways to pay for prescription drugs and other day-to-day necessities is a painful balancing act. And with drug prices constantly rising, the problem gets worse by the day. CNN medical correspondent Rea Blakey shows us just how serious the problem is for one American.


BLAKEY: Bobby Cherry worked at the White House 37 years ago as a courier. The last time he was there, he was working with AARP to help President Bush gain momentum for a Medicare prescription drug card for seniors. He is still waiting and taking a series of life sustaining prescription medications which eat up about 1/4 of his monthly income.

BOB CHERRY, FORMER WHITE HOUSE WORKER: I make sure I get those medicines because that's my lifeline. And it's everything else has to go -- have to be set aside. But I'm going to get my medicine.

BLAKEY: Bobby Cherry now takes four prescription drugs. It all started after two heart attacks, two hip replacement surgeries and a congestive heart condition. Occasionally, he resorts to skipping dosages of his cholesterol medication just to make the prescription last longer.

CHERRY: But at least you do can go everyday, every other day with that, if you have to.

BLAKEY: He also signed up for one drug company's senior prescription card trimming the cost of each bottle of pills to just $15. But he had to switch to different brands to get the benefit.

(on-camera): While millions of seniors try to figure out how to afford the medications they need, the cost of prescription drugs continues to climb. In the last two years, brand name drug prices have increased by 18 percent each year.

(voice-over): Drug companies say research for new drugs is what drives the prices up.

CHERRY: Is it fair for seniors to struggle like this? No.

BLAKEY: For Bobby Cherry and his peers, legislation it help seniors afford prescription drugs is long overdue.

Rea Blakey, CNN, Washington.


WOODRUFF: I'm here at the Capitol in the Democratic prescription drug war room. It's actually a room in the offices of the Senate Majority Leader Tom Daschle. They're calling this the medicine cabinet. The whole idea is to highlight differences between the Democratic prescription drug plan and the less generous and less costly Republican plan. But you know, clever props like these are not going to insulate either side from the anger of voters this November if they are not table come together and pass a bill.

We're going to hear the Republican side in just a moment. But first, the Democratic side from Senator Edward Kennedy, one of the sponsors of the Democratic bill. Senator, by the time this airs, the vote will have taken place. Neither side is expected to get the 60 votes necessary. Where do you go from here?

SEN. EDWARD KENNEDY (D), MASSACHUSETTS: Well, first of all, we have to realize where we are. This is really the most important health issue that we will debate since the Medicare debate of 1965. It's really defining issue about our society, what kind of country are we going to be.

Are we going to say to our senior citizens, the men that fought in World War II, lift the country out of the Depression, now are elderly, now are sick, that they are going to be pushed aside or are we going to take care of their prescription drug needs? And what's been encouraging this afternoon is that there's an overwhelming majority of the members of the Senate on both sides that want to get action. I still think we can get it.

WOODRUFF: Senator, but given the fact there's going to have to be a compromise, are you prepared not only to compromise on the cost to bring the cost down, but also importantly to have private insurers pick up the organization and the payment of these benefits rather than the government.

KENNEDY: Well, we're not going to compromise on our commitment to our senior citizens. We are committed to a strong package. Will we consider a different proposal? Clearly, they'll be considered on the table. But the great debate in 1964 and five was, are we going to do it private companies and the Senate rejected that. We have the Medicare system now, which has the confidence of the senior. We have the same debate now. And so, we are strongly committed to making sure that we are going to have a system that works. That's the key element. Can you blend them? I think that's complex and it is difficult. But we are committed to trying to try and we are going to continue to fight for this program. WOODRUFF: So it sounds like there may be some give on that. What about on the cost, Senator. We are talking about $590 billion if you run it out over 10 years. People are saying especially after baby boomers hit retirement age, this is just a huge amount of money.

KENNEDY: We have a $600 billion tax reduction by the administration for this year, this year. The seniors are going to spend a trillion 600 billion dollars during that period of time. If you're going to do more than lip service, if you're going to have a real program, which the Republican program is not, then if you're going to provide real help and assistance, then you're going to have to make some priority choices.

WOODRUFF: Are you worried the Democrats may be blamed in the Senate because the Democrats run the Senate if nothing happens?

KENNEDY: Absolutely not. Our Republican friends ran it for the last four years. We had these bills that they could have called up at any time. They never did. Democratic leadership Tom Daschle insisted that we have this debate and it is now providing leadership to try and bring these forces together. We all want to get something done. We're not going to sacrifice in making sure we get a good benefit package four our seniors but we'll consider options and we are strongly committed to getting something done.

WOODRUFF: Senator Edward Kennedy, thanks very much. Appreciate it.

KARL: ... subway joined by Republican Chuck Hagel, the chief sponsor of the Republican prescription drug bill. Senator, OK, now you've got this bill. It's the least costly bill, but it essentially pays 20 percent - you must pay your prescription drug cost up to 20 percent of your income as I understand it, correct?

SEN. CHUCK HAGEL (R), NEBRASKA: Well, that's the higher income. Those...

KARL: But even the lower income. You say people at poverty level for instance, which is $8,870.

HAGEL: That's right.

KARL: They need it pay their first $1500 of prescription drug costs. How does somebody who's making 8, $9,000 a year, pay $1500 in drug costs?

HAGEL: First of all, there are moneys out there that they have and they use and also, there are, remember, 2/3 of the people out there, have their own prescription drug insurance policies. And we think it is feasible because it is roughly a hundred dollars a month. We think if you are paying that now, and many are paying more than that on that poverty level, then that's doable. That's OK. Now, maybe someone will want it amend it. But we have to keep this thing responsible as well as focus on those who need it. So essentially it's about $100 a month. Once that out of pocket is reached, then the government will pick up the rest.

KARL: You're talking about a means test, targeting in this towards lower income workers, lower income retirees, I mean. Now why is Congress always been so adamantly opposed to anything in terms of entitlements with a means test? This is something that has come up before and it's never had any support whether it is Social Security or Medicare or anything.

HAGEL: I don't know. I think the real question is, do people like Warren Buffett, who's one of my constituents...

KARL: Good guy.

HAGEL: He's a wonderful guy. And he's got a buck or two. He has never said to me he needs a Medicare prescription drug plan. There are many people in this country...

KARL: And a Democratic plan would give a prescription drug benefit to Warren Buffett.

HAGEL: That's exactly right.

KARL: Now what about the politics here? Virtually all 100 senators campaign in part on saying they would get a prescription drug benefit to Medicare What happens if you guys go home and you've done nothing?

HAGEL: People are getting a little tired of the rhetoric and the promises and when are we going to see action? That's a function of leadership. The president needs to get into this. The Congress needs to get into it. I don't know what's going to happen. But if we have to go home empty handed this year, at least what we did do for the first time ever, actually had a debate, we actually had votes, we actually laid down markers, and if we have to come back early next year, which we will do and start from that base, then we will. And I think then if that's what happens, then we will get a prescription drug bill next year.

KARL: Next year. That sounds a lot like what we said last year but we'll what happens, see if the president will get involved?

HAGEL: Well, the president must get involved. Things can't happen without presidential leadership. You can throw 535 of us up here and we all think we should be president HHS secretary and thing you're going to get a resolution. You're not. The president must be part of this.

KARL: Well, Senator Hagel, I appreciate your time. Good luck, take care.

WOODRUFF: Love those subway rides.

Just ahead on "Inside Politics." Pope John Paul II celebrates with the world's youth. He's now in Canada, the first leg of an 11- day tour. But should the frail pontiff be traveling at all? We'll tell you what some of his aides are saying. (COMMERCIAL BREAK)

WOODRUFF: Checking our INSIDE POLITICS "Newscycle": President Bush gave the go-ahead today for Nevada's Yucca Mountain to become the nation's central repository for nuclear waste. Mr. Bush signed the bill this morning. There are plans to open the site eight years from now. But, the state of Nevada has five lawsuits pending against the project, and the Energy Department must still get a license from the Nuclear Regulatory Commission.

Hundreds of thousands of acres in the western U.S. remain under siege from huge wildfires. One of the hardest hit states is Oregon. More than a dozen fires have scorched nearly 300,000 acres in that state.

The Bush administration is condemning an Israeli missile attack that killed the military leader of Hamas and at least 14 civilians. The White House calls the attack heavy-handed and says it does not contribute to peace. In the attack, Israel fired a missile from an F- 16 at the apartment building where the Hamas leader lived. Hospital officials say nine children were among those killed.

Pope John Paul II has arrived in Canada's biggest city to celebrate world youth day. The pope's stop in Toronto is part of an 11-day trip that also includes stops in Guatemala and Mexico. He's traveling against the advice of aides who say the tour may be too much for the frail, 82-year old pontiff.

Just three months after rejecting one of President Bush's nominees for the Fifth Circuit Court of Appeals, the Senate Judiciary Committee has opened hearings on another controversial nominee. Mr. Bush selected Priscilla Owen more than a year ago for a seat on the New Orleans-based appellate court. Owen is now a Texas Supreme Court Justice and her selection is stirring opposition from the same groups the public complains were engineering the defeat of Mississippi Judge Charles Pickering.


PRISCILLA OWEN, APPEALS COURT NOMINEE: When I decide a case, I must do so on the basis of the fair and consistent application of the law. And my decisions cannot be based and are not based on whether a party is rich or poor or who their lawyer is. My decisions are based on the law, whether that's a statute or a United States Supreme Court decision or a prior decision from my court.


WOODRUFF: With us now from the set of "CROSSFIRE," Tucker Carlson, Paul Begala.

Gentlemen, there are pro-abortion groups, rights groups, who are painting this judge as anti-abortion. Even her former colleague on the Texas Supreme Court, Alberto Gonzales, who is now President Bush's White House counsel, at one point described her ruling an unconscionable act of judicial activism. Has abortion become the litmus test for anybody trying to get a court appointment, Tucker?

TUCKER CARLSON, CO-HOST, "CROSSFIRE": Well, this just shows how completely extreme the Democratic Party has become on this subject.

The case in question is not about the right to abortion. It's not even about parental consent for abortions. It is about notifying the parents that their minor child is planning to have an abortion. Now, there is some question, by the way, whether Mr. Gonzales was referring to Priscilla Owen or to a Texas Supreme Court member named Nathan Hecht. In fact, in this case, Priscilla Owen was the one who charged that the other justices were being activists.

She affirmed the decision of two lower courts who took the same position she did in this case. So, it is confusing. But the bottom line is, anybody who has any doubts about the legality of abortion is unacceptable to Democrats. And that is an extreme position.


PAUL BEGALA, CO-HOST, "CROSSFIRE": Well, in fact, the Democrats have confirmed dozens and dozens of Bush's nominees. And I can't think of any who were pro-choice. So, Bush in fact has used a litmus test on this. And I think it is a cynical manipulation.

Even among pro-life attorneys and judges, I find it hard to believe that Priscilla Owen is the most qualified person in the whole 5th Circuit. This is about politics. It's about payback to the far right-wing, appointing a judge who is so extreme that, as you pointed out, Bush's now White House counsel, then Priscilla Owen's colleague on the Supreme Court in Texas, did in fact say that her opinion, joined by Nathan Hecht and another member of the court, was an unconscionable act of judicial activism. So, it's not about conservatism. It's about activism. And, for Bush, apparently, it's about abortion.

CARLSON: Maybe you didn't hear me. He wasn't talking about her. He was talking about Nathan Hecht.


BEGALA: There was a three-judge dissent, Hecht and Owen and a third judge. And that's who Gonzales was pointing to.

CARLSON: For you to claim that she's unqualified on the basis of no evidence at all and that she's extreme, again on the basis of no evidence at all, is outrageous.

BEGALA: Let me give you some: 85 percent of the time, she votes in favor of her contributors. One of the largest was Enron. She ruled that Enron could bypass a quarter of a million dollars in taxes.

CARLSON: So, we're back to Enron. Give me a break. Find something new, man.

BEGALA: She ruled 70 percent of the time in favor of big insurance companies. (CROSSTALK)

WOODRUFF: Gentlemen, let me ask you, coincidental with all this, there is a group today that is starting a campaign to pressure Democrats, including Democrats who are running for office who aren't already in the Senate, to support the Bush nominees.

I want to show you just a portion of an ad running in Texas against the Senate Democratic nominee there, Ron Kirk.


NARRATOR: At first, Ron Kirk said the Senate needed someone to confirm judicial nominees. Then he met the East Coast liberal band, took their money, and changed his mind.


WOODRUFF: Is this effective, Paul Begala?


Look, I've run ads that don't work, too. I don't want to criticize. But this a group of right-wing attorneys and lobbyists here in Washington that kind of want to make a name for themselves. They're succeeding. We're going to have their spokesman, Boyden Gray, on "CROSSFIRE" tonight.

But, no, it is not going to have any effect in that race in Texas. People in Texas know Ron Kirk. He's been a successful mayor. He's a moderate. And he's going to win that Senate seat.


CARLSON: You know I don't know if the ad itself is going to work. Of course, I agree with it. It amused me.

But the bottom-line issue is that there are all these seats unfilled. They need to be filled for justice to be done. And the abortion industry is preventing Democrats, who they control like puppets, from voting for people with moderate, mainstream views on the subject. It's a complete outrage. And I hope this group brings it to light.

WOODRUFF: Gentlemen, Tucker, what's on "CROSSFIRE" tonight?

CARLSON: Well, we have Boyden Gray and Ralph Neas on this very subject. And then we have the Reverend Al Sharpton, who is speaking out in the middle of this cocaine scandal in which he is embroiled. He is, of course, the leading Democratic contender for the nomination for president in 2004.

BEGALA: The right does this every time.

CARLSON: It's true. It is totally true. I love it.


BEGALA: ... any more than Jerry Falwell represents the Republican Party.

WOODRUFF: All right, we'll be watching. Tucker, thank you. Paul, thanks.

BEGALA: It's going to be a great show. Thanks, Judy.

CARLSON: Thanks, Judy.

WOODRUFF: And coming up in the next hour, CNN investigates Osama bin Laden. Is he dead or alive? They're down to tracking his movements through cyberspace. And you won't believe where some of the clues are hidden. Our Pentagon correspondent Barbara Starr will have that report on "WOLF BLITZER REPORTS" at 5:00 p.m. Eastern.

"Inside Buzz" next on what insiders are telling Republicans about the importance of midterm voter turnout.

Also ahead: a day of unity for New York Democrats, or was it? An update on the New York Senate race in "Campaign News Daily."


WOODRUFF: The recent stock market slide and anger over the corporate accounting scandals has changed the political mood here in Washington, you won't be surprised to know. Republicans are scrambling to get on what they see as the right side of the corporate responsibility issue.

For more on all this, let's turn again to our Jon Karl -- Jon, what are you hearing?

KARL: Well, Judy, Republicans up here on Capitol Hill, especially in the House, are buzzing about a presentation given by Bill McInturff, a prominent Republican pollster, painting a very pessimistic outlook for the midterm elections for Republicans.

Three major points were presented by McInturff. One, he looks at the right-track/wrong-track numbers. This is where pollsters ask, "Is the country on the right track?" Only 37 percent in his poll thought the country was on the right track.

And then there's the stock market, of course, going lower and lower. And he said, now with 60 percent of voters also investors in the stock market, this could be, for the first time, a major issue in an election. And, secondly, he was showing in his polling signs that incumbents are more vulnerable than they were thought to be even just a couple months ago.

Now, Judy, with all the buzz about this presentation and related speculation about a bad turnout for Republicans in November, Matthew Dowd, the top pollster for the Republican National Committee and adviser to President Bush, has put out his own memo talking about some misguided analysis out there. Dowd says, yes, it is true that the right-track/wrong-track numbers have gone in a negative direction, not as negative as McInturff says, but a negative direction.

But there's a lot of other good signs out there for Republicans, especially, Judy, the fact that the president's own approval rating is still over 70 percent -- Judy.

WOODRUFF: All right, Jon, thanks very much.

Well, Bob Novak is here with a little more "Inside Buzz."

And, Bob, picking up on what Jon was reporting, what are you hearing about the 2002 elections?


Dick Gephardt, the Democratic House leader, may not have said that they would pick up 40 seats. He claims he never said that. But other Democratic House members are telling me that they'll pick up 20 seats. But the most interesting thing was that they had a retreat at the Greenbrier, some of the big Republican contributors, about 200 of them. What they call the Republican Council was out there with some Republican senators.

And it was very closed-door, very secret. And the Republican senators were in a very gloomy mood. They said if things in the economy don't get better by September 1, it is going to be bad in November. They're very worried.

WOODRUFF: All right, quickly, two other things. You have been looking at who some longshots may be in the 2002 midterms. What are you hearing, first of all, in Tennessee?


NOVAK: Longshot No. 1: in Tennessee, Ed Bryant, running against former governor, former presidential candidate Lamar Alexander in the Republican primary, way behind in the polls. But everybody on the Alexander side is worried about turnout, even though he is from East Tennessee, the big Republican stronghold.

The Democrats are praying that Ed Bryant wins that primary. They think he's an easier general election candidate than Lamar Alexander. That's the Fred Thompson seat.

WOODRUFF: All right, there's another longshot in Florida, a Democrat.

NOVAK: That's right.

That is the Janet Reno race against Bill McBride. And Bill McBride was given no chance at all. But what he has in the Democratic primary for governor, he has the advantage of lots and lots of money. He has got about $1 million. Janet doesn't have a dime. She can't go on television. The Republicans are praying for Janet to win, because they think Jeb Bush can beat either one, but they think McBride would be a much tougher foe than Janet Reno. Can you imagine the Republicans praying for Janet Reno? WOODRUFF: The Democrats have been saying this for some time.

Bob, thanks very much.

NOVAK: Thank you.

WOODRUFF: Appreciate it.

"Inside Buzz" from California, where gubernatorial candidate Bill Simon has reluctantly released his income tax returns. The forms show that Simon reported $36 million in income between 1990 and 2000. He paid more than $8 million in federal taxes and more than $2 million in state taxes. Although Simon made the information public, he did not make it easy for reporters to see these documents.

For more on all this, let's turn to John Wildermuth of "The San Francisco Chronicle."

First question, John, "Did he pay his fair share?" is I guess the first question everybody has?

JOHN WILDERMUTH, "SAN FRANCISCO CHRONICLE": Well, Governor Gray Davis' people had all been saying that the reason that Simon wasn't releasing taxes is because he had something to hide.

But looking at him yesterday, he is a wealthy man and he pays an awful lot of taxes. About 24 percent of his income goes to federal taxes. And it is a pretty substantial income.

WOODRUFF: Well, if that's the case, why has he been saying since April that he didn't want to put the taxes out?

WILDERMUTH: Well, what he said all along is that it a matter both of principle and privacy. And the privacy wasn't just for him.

Much of his money is locked in partnerships with his brother and his five sisters. And his argument was that, by releasing information about his taxes, he essentially exposes their financial dealings in everything, and they're not running for anything.

WOODRUFF: Now, there were restrictions placed on just how reporters could get a look at all this. How did that work?

WILDERMUTH: It was pretty bizarre yesterday.

What they did is, the Simon people rented a hotel conference room in Sacramento. And they said, "We're going to let one person from every broad news outlet in at 3:30." And you were allowed to come in. You weren't allowed to bring any tape recorders. You weren't allowed to make copies. And they wanted you to use the paper they provided.

And you had about two hours to go through two telephone-book- thick volumes of tax returns, more than 1,000 pages. It was absolutely impossible to get a full look at what was on those taxes.

WOODRUFF: And how do they defend doing it this way, John? WILDERMUTH: Again, it is the question -- he said: "Well, we still deserve some privacy. The candidate wants their privacy." And how would you like to see your taxes out on the Internet -- though I didn't think anybody was going to grab these and sell them on eBay right away. I don't know how many buyers there would be.


WOODRUFF: All right, John Wildermuth, "San Francisco Chronicle," thanks very much.

WILDERMUTH: Thank you.

WOODRUFF: And now checking the headlines in our "Campaign News Daily": A unity dinner for New York Democrats last night was a little less unified than organizers might have hoped. Senator Charles Schumer's decision yesterday to endorse Carl McCall over Andrew Cuomo in the primary race for governor overshadowed the planned unity theme. Cuomo and McCall kept their distance on stage, as their supporters tried to outcheer each other in the audience.

Senate Republicans are running new ads targeting Louisiana Democratic Senator Mary Landrieu. One ad compares Landrieu's voting record to that of perennial GOP target, Senator Edward Kennedy.


NARRATOR: Landrieu's tax record: over 120 votes for higher taxes. The truth is, Landrieu votes with Ted Kennedy over 70 percent of the time.


WOODRUFF: In Florida, Governor Jeb Bush sent his son, George P. Bush, to file the paperwork for his reelection campaign. The younger Bush traveled to the state capital of Tallahassee, where he paid his father's $7,200 registration fee.

And now here is Jeff Greenfield to tell us what is coming up in his "Bite of the Apple."


JEFF GREENFIELD, CNN SR. ANALYST: I'm Jeff Greenfield in New York.

At the midpoint between the major parties' national nominating conventions, we'll look back on two summers ago at a completely different world.



WOODRUFF: In today's "Bite of the Apple," Jeff Greenfield takes us back to the summer of 2000. It has only been two years, but they have brought changes we might never have imagined.


GREENFIELD: Two summers from now, the major political parties will gathering at arenas like Madison Square Garden for their nominating conventions. And we will be following their journeys to those conventions thoroughly, maybe even obsessively.

But that day-to-day focus can sometimes obscure the bigger picture: in this case, how almost every assumption we had about ourselves and our country and our world two summers ago has been wiped out.

(voice-over): When George W. Bush...


GOV. GEORGE W. BUSH (R-TX), PRESIDENTIAL CANDIDATE: I proudly accept your nomination.


GREENFIELD: ... and Al Gore accepted their nominations, there was one key economic assumption: Prosperity was a permanent fact of our national life. Unemployment was below 5 percent, inflation just about nonexistent. And those deficits that had plagued Washington for 30 years? Gone, wiped out, replaced by the specter of enormous surpluses, some $5 trillion worth over the next decade. The big argument back then?

BUSH: The trillion dollars comes out of surplus.

GREENFIELD: What to do with all that money. How big a tax cut could we afford, how generous a prescription drug program? When would we pay off that national debt? Today, there is no surplus; instead a projection of a $165 billion deficit for next year.

Almost every state in the Union is facing an ocean of red ink, which means less money for schools, roads, health care. Two years ago, that unbroken prosperity seemed the birthright of tens of millions of Americans. Their savings and retirement funds were not gathering dust in bank accounts. They were in equity markets, which only knew one direction: up.

Today? High stock averages have been replaced by high anxiety, $7 trillion in wealth gone. Even if much of that was on paper, the impact on America's financial security is immeasurable, not to mention the loss of faith in a financial world that now seems more like a casino where the dice were loaded.

Speaking of security, two summers ago, we were just as certain of the permanence of peace as we were of prosperity. Today, that certainly lies literally in ruins. Two summers ago, there was real reason to believe that real peace might be a realistic hope for the tinderbox that is the Middle East. Today, that dream lies literally in ruins. (on camera): Of course, it is possible that two summers from now, Americans will feel rich again, the budget surpluses will be back again, terrorism will be but a fading memory, and the parties in the Middle East may once again find themselves on the road to peace.

But what we know now at this midpoint is a painful truth: Our most basic assumptions of two summers ago are gone, replaced by a much colder, much darker reality.

Jeff Greenfield, CNN, New York.


WOODRUFF: Former Arkansas Senator and Governor Dale Bumpers will talk about a meeting of seven current and former governors of the state of Arkansas in Little Rock tonight. We'll tell you why they are there -- he will -- in just a minute.


WOODRUFF: A gathering tonight in Little Rock, Arkansas, will be an historic political occasion for that state. Seven men who have served as governor of the state, including Bill Clinton, are getting together to raise money to renovate the governor's mansion.

With us now from Little Rock: former Governor and former Senator Dale Bumpers.

Senator, I guess it would take something like this to get all seven of you together? You're Democrats and Republicans.

DALE BUMPERS (D), FORMER ARKANSAS GOVERNOR: Everybody is really excited about it, I think, Judy.

As you know, Bill Clinton is going to be here tonight. And it is really something to have six former governors and a sitting governor. There's seven of us that are going to be there this evening. And, incidentally, this is not a renovation of the mansion, Judy. It is the building of a new -- there's some renovation to it, but it is something that's being built out behind the mansion. It's to seat 300 people at dinner or for whatever occasion you want.

WOODRUFF: Well, I gather they have just done some renovation, because the governor has been living in a double-wide trailer out back.


WOODRUFF: I guess the mansion was in pretty decent shape when you lived there back in the '70s.

BUMPERS: It was in decent shape.

And, frankly, this needed to be done. When Betty and I entertained when I was governor, we had to put people in the bathroom, in the foyer, wherever we could put them; 50 was the very most. And we had to put people in the living room. The dining room would only seat about 24 people. So this is long overdue. The governor needs -- he needs a place to entertain and a lot more people.

WOODRUFF: Senator, I want to ask you just quickly. As you're in Arkansas, I assume you get back there a good bit, even though you now live in Washington. But what do you hear from your former constituents about the heavy focus in Washington right now on corporate responsibility and, frankly, on where the economy is heading? What are you hearing?

BUMPERS: I will tell you, Judy. I hear pretty much the same thing some of your previous guests have said. I was watching this show before I came on.

I would say one other thing. I believe the reason this is so dangerous politically for the Republicans, frankly, is because so many people who were planning to retire, they're not going to be able to retire. They're going to have to work one to two years more than they planned, some of them three years more than they planned.

Secondly, I have never seen this country quite as restive and apprehensive and concerned. They don't see any light at the end of the tunnel. When you consider the fact that the public who traded stocks in this country have lost about $8 trillion in value, that is value that could have been purchasing power that could have stimulated the economy. Now people are afraid to spend money because they just don't know where this is going to land.

And when you consider the fact of Japan -- we've always been used to ups and downs. And the stock market would go up and then it would go down. Most years Clinton was in office, it went up and people did very well. But when you think about Japan, Japan has had a stagnant economy for almost eight years. And it is still stagnant. So, people look at that and they think that could happen here.

WOODRUFF: Senator Dale Bumpers, former senator and former governor of Arkansas, we thank you for your thoughts. He is going to be joining five other former governors and the current governor in Arkansas tonight for a gathering there to put some money together to improve the mansion.

Thank you very much.

Actor Bruce Willis took his star power to the White House today. Willis is pitching in to help President Bush in his new initiative to encourage Americans to adopt children in foster care. Mr. Bush has named the actor as his national spokesman for the new initiative. Willis plays a key role in a new public service campaign to push this initiative. First lady Laura Bush is also actively involved. The latest numbers show that more than 130,000 of the one-half million American children in foster care are waiting to be adopted.

INSIDE POLITICS will be right back, but now let's take a look at what is coming up on "WOLF BLITZER REPORTS" -- hello, Wolf.

WOLF BLITZER, "WOLF BLITZER REPORTS": Hi, Judy. A story you'll see only here on CNN: Are there clues in the hunt for Osama bin Laden? Learn what might be lurking online. And it's happened again: a young girl snatched from the streets, this time a call for ransom. We'll have details. And what did the pope really risk when he decided to walk down these stairs?

Those stories and more coming up at the top of the hour, right after INSIDE POLITICS.


WOODRUFF: And that's it for INSIDE POLITICS. "WOLF BLITZER REPORTS" is next. Thank you for joining us. I'm Judy Woodruff.


Traficant Expulsion Hits Snag>



Back to the top