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Bush Takes Economic Message on Road; Democrats Plan Independent 9/11 Commemorations; Democratic Presidential Hopefuls Flock to Iowa

Aired August 14, 2002 - 16:00   ET


JOHN KING, GUEST HOST: I'm John King in Washington. President Bush gives his upbeat economic message a road test in the Midwest and takes a swipe at Congress along the way.
BRUCE MORTON, CNN CORRESPONDENT: I'm Bruce Morton at the Iowa state fair. There's nothing like it and that's no bull.

JONATHAN KARL, CNN CONGRESSIONAL CORRESPONDENT: I'm Jonathan Karl in front of the White House, where we were hoping to talk to Defense Secretary Donald Rumsfeld. And ask him...

UNIDENTIFIED MALE IMPERSONATING DONALD RUMSFELD: Are you normally kept in a jar, young man? I will address INSIDE POLITICS and tell you that I'm going to give you information, but I don't want to.

KING: Also ahead, are New York Democrats opening themselves up to accusations they are politicizing the first anniversary of September 11th?

Thanks for joining us. Judy is off this week. We want to take you immediately now live to the Iowa State Fair in Des Moines, where President Bush is delivering a speech one day after his economic forum in Waco, Texas. The president now talking about the U.S. economy, international trade, and the need, in his view, for a new energy policy.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: We can grow our way to become less dependent on foreign sources of crude oil. It's in our nation's interest that we become less dependent on foreign sources of energy.


We need to make sure that in order for our economy to be strong, for the farm economy to remain strong, that the tax relief package we passed is permanent.


When your economy slows down, it is very important to let the people keep their money. You see, when a person has more money in their pocket, they are likely to demand a good or a service. And when they demand a good or a service, somebody is going to produce the good or service. And when somebody produces the good or service, somebody is going to find work. The tax relief package that we passed came at the right time for America. Unfortunately, because of a quirk in the law, it goes away after 10 years. Unfortunately, it is not permanent.

For the sake of our farmers and ranchers, for the sake of the small business owners here in America for the sake of people that need to plan, Congress needs to make the tax relief permanent.


Yesterday we had an economic summit in Baylor University in Waco, Texas. I told them, I said, welcome to the middle of Texas in the middle of August. They must have had something on their mind, and they did. One of the things we heard over and over again from our small business people and from our farmers and ranchers that were there was how terrible the death tax is. People wonder about how do you keep the farm in the family. One way you keep the family farms intact is not to tax the person's assets twice.


Part of that tax relief plan I'm talking about was the repeal of the death tax. It comes back after 10 years. That's bad public policy. I strongly urge the farmers and ranchers here and those who own their small businesses to demand that your elected representatives repeal the death tax once and for all.


There's other things we can do and must do. We got to have fiscal responsibility in Washington, D.C. We got to make sure we don't overspend. Every project sounds fantastic. Every idea is worth funding in Washington. But that's not reality. It's important to set priorities with your money and to make sure we stick to those priorities. Congress sent me what they call a supplemental spending bill.

There was a healthy amount of money in there for fighting the war on terror and for protecting our homeland, which I thought we needed. But they added $5 billion extra, including a new building to house the worm and bug collection of the Federal government. And they put a stipulation on the money. The governor will appreciate this. They said either you spend it all or none of it.

For those of us in the executive offices don't particularly like that kind of language. Either you spend it all, or you spend none. Either you spend everything we think is necessary, including the house for bugs and worms, or you don't spend any of it. Well, they made their decision, I made mine. We're not spending any of the extra $5 billion for the sake of fiscal sanity in Washington.


There's a lot of things we can do. We need a terrorism insurance package to get our hard hats working again. There's over $8 billion worth of projects, large projects, which are stalled in America because we can't get terrorism insurance to the developers.

Congress needs to pass a good bill which understands putting our hard hats back to work is good for the American economy. But there is one other thing we need to do here in America. We need to take some of the good old fashioned farm values and make sure they're a part of our culture. I'm talking about values of hard work and honesty. I'm talking about telling the truth.

KING: President Bush speaking at the Iowa State Fair just outside of Des Moines, Iowa. This his second stop in Wisconsin earlier today, the day after his major economic forum in Waco, Texas. Traveling with the president throughout the day, joining us now to give us a flavor of the president's remarks this day, Suzanne Malveaux, also on the state fairgrounds in Des Moines -- Suzanne.

SUZANNE MALVEAUX, CNN CORRESPONDENT: Hi, John. It's part of a triple-state tour of pushing forward his economic agenda, many of the items that he mentioned. Yesterday, a part of the forum, fiscal responsibility, making the tax cuts permanent as well as opening up markets, free trade, really some of the ideas that he is going to be rallying around the country, bringing to Americans that message on the road, much up until we expect November midterm elections, congressional elections.

That is because it's part of the administration's strategy to get him out there, as well as to show that he is concerned about Americans' economic situation as well as decline in stock market, and many of the indicators that show it's a sluggish economy.

You mentioned before Wisconsin. He was there, but I have to tell you that also it is not just about being in the heartland talking about the economy. It is also the political landscape as well. Very important three states -- Wisconsin, Iowa, as well as South Dakota. Some very serious and tough congressional races. He's going to make sure to be raising campaign funds for candidates that are in really tight races in the coming elections -- John.

KING: And Suzanne, how is the White House reacting to this storm of Democratic criticism, a good deal of editorial criticism that yesterday's forum was, as some call it, a made for TV infomercial. No new policies, no real criticism of the president.

MALVEAUX: Well, that's right. The administration is really on the defensive today. The president earlier in Wisconsin actually addressing that, saying that, look, if I asked an audience of you here in Wisconsin, you would say the same thing.

I would get the same kind of response. I talked to the farmers, to the truckers, to the housewives. But it is very interesting because out of the 240 participants from yesterday's forum, about half of those were managers of companies or CEOs, clearly not the kind of representation that you saw in the audience of Wisconsin or the audience you see here in Iowa.

KING: And Suzanne, you mention mostly the economy and politics, but we understand when the president arrived in Iowa, he had some pretty famous greeters. Tell us about that.

MALVEAUX: Oh, that's right. Yes. The McCoy septuplets. Really it was adorable to see -- all seven of them were there. You may recall, they made history. This was in November of '97, as the world's first surviving septuplets. They were all greeting him, all at once, and it was really kind of special to see. The president seemed quite amused by the whole thing, that he was able to actually meet with them as well.

KING: Suzanne Malveaux with us, and with the president today from the Iowa State Fairgrounds in Des Moines. Thank you.

MALVEAUX: Thank you.

KING: And now a quick flashback. Exactly three years ago today, George W. Bush was in Iowa celebrating his victory in that state's Republican straw poll. That win burnished his credentials as the Republican frontrunner in campaign 2000 and helped set him on the path to the presidency. No wonder he felt like dancing.

KING: And now back to the current political scene. House Minority Leader Dick Gephardt also was at the Iowa state fair today, campaigning to win Democratic control of the House this fall, and laying the groundwork for a possible 2004 presidential bid of his own. The Iowa Republican party is running a radio ad pegged to Gephardt's visit. It says Gephardt voted against legislation that would have helped hospitals in Iowa which ranks last among states in Medicare reimbursements.


IOWA STATE PARTY RADIO AD: Gephardt voted to keep Iowa last. Gephardt is visiting Iowa this week. He's here to get support for his agenda like help blocking payments for our rural hospitals. Who's he kidding? So if you see Dick Gephardt, tell him Iowa needs its fair share for healthcare.


KING: We did see Gephardt and we did ask him about Medicare and he turned the tables back on Republicans.

REP. RICHARD GEPHARDT: We had a budget two years ago that had a big surplus, and we wanted to dedicate that surplus to Social Security and Medicare. Now we have a new economic policy, the Bush economic policy. Now we're back into big deficits.

KING: Iowa's Democratic governor, Tom Vilsack, was planning to talk today to both Gephardt and President Bush about boosting the state's Medicare reimbursements. I spoke with the governor this afternoon when he was attending the state fair and I asked him to explain this Medicare controversy and just what he wants from the president.


GOV. TOM VILSACK (D), IOWA: I tell you John, it's a billion dollar problem for our state. We provide very efficient healthcare but the result is that we're being reimbursed at a rate much below the national average, several thousand dollars per patient below the national average, and right now what's happening is we're having a hard time getting qualified nurses and doctors who want to stay in Iowa or come to Iowa, because we can't pay them what they're entitled to receive, because the reimbursement rate is so low.

KING: The president comes to the Iowa state fair one day removed from his economic forum in which his message to the American people was all is pretty good and getting better by the day. Do you share that assessment?

VILSACK: Well, in our state we are beginning to see a slight turnaround. We're almost at record levels of employment. Our state revenues have picked up a bit, and we ended the last fiscal year after cuts with a slight surplus.

But there is still a long, long way to go. We need to do much more in terms of investing and research and development to develop new products and innovation. I think we have to recommit ourselves to productivity, and I hope that the president and congressional leaders understand that it's not just about summits or forums. It is about real progress and real policy.

KING: Let's focus, as we close, on politics. The Iowa state fair and presidential politics go hand in hand. You have not only a president there at the fair this year, but you have a lot of wannabe presidents from your party, the Democrats. Give us a flavor of the Democrats campaigning in your state and how you view the race as we speak in August 2002.

VILSACK: Well, John, it's been very aggressive. I've been surprised about how aggressive it's been. John Edwards, John Kerry, Senator Lieberman, Joe Lieberman's going to be here in a few hours. Dick Gephardt has been here several times. Tom Daschle has also been here. We've been very, very fortunate to have these individuals crisscross our state. I'm however surprised at the intensity of their visits. We're certainly impressed about it and encouraged by it and excited about it because it gives us an opportunity to not only listen to their views, but also as folks like Howard Dean crisscross the state, we learn from them about things that are taking place in their states, and we're also able to press the case for Medicare reform or Medicaid resources or prescription drug help.

So it's a terrific opportunity and today is a particularly good opportunity because we are extraordinarily proud of our state fair. And it's an opportunity for us to show off the best in Iowa.

KING: Al Gore hurting himself by not coming out there until October, sir, and as you answer, if the caucuses were held today, which Democrat is leading the pack at the moment?

VILSACK: Well, it's pretty difficult to say which Democrat is leading. Certainly there are a the lot of folks that have a very deep affection for Vice President Gore.

Mrs. Gore came to the quad cities not too long ago and was warmly received. At this point in time I don't think there is a clear favorite. I think everyone basically starts back from square one. And we're excited to learn about these individuals and meet them. And we are also particularly interested in their views about the future. I think retail politics in Iowa has been sort of perfected over the course of the last 20-some years as we attended the caucuses and participated in the caucus process. So there's a long way to go. I wouldn't say there's any clear-cut favorite at this time.


KING: And we turn now from Iowa to New York, where some Democrats are uneasy about an ad in the works to mark the first anniversary of the September 11 attacks. The state Democratic party is preparing the spot, which will feature more than two dozen party figures reading the Gettysburg address, that as a tribute to the September 11th victims.

Now why might that be a problem? Well, President Bush and other prominent Republicans already plan to read the Gettysburg address during televised ceremonies on September 11. Will Republicans now accuse the Democrats of trying to use the anniversary to their political advantage? We're joined to explore that question and others by Joel Siegel of the "New York Daily News."

Joel, the Democrats doing this because they're uneasy, why?

JOEL SIEGEL, "NEW YORK DAILY NEWS": Well, there's a couple reasons. The first thing is September 11 is going to provide an incredible platform for Governor Pataki right in the middle of his reelection campaign, and all he has to do is appear statesmanlike and it is going to connect with voters. The Democrats don't have that kind of platform.

The second problem is that the Democratic primary for governor is on September 10th. So this could be one of the first elections in my memory where voters have decreasing interest as the election day draws near. Democrats are really concerned that there's going to be even less interest than normal in their primary and the next day they're not going to get the traditional exposure and the post-primary bounce for whomever wins.

So they see this ad as a way to get themselves out there and say, hey, we are part of the landscape too. We care about September 11. We want to pay tribute to the victims and the heroes as well.

KING: So Andrew Cuomo, one candidate for governor, Carl McCall, another candidate for governor, your understanding is they would both take part in this ad and read briefly. Why not, would Senator Clinton, would Senator Schumer, will they be involved in this?

SIEGEL: Well, the initial reading from the McCall and Cuomo camps is that they are interested in participating. They're inclined to participate. They want to see how this plays out, what the ad exactly says.

Senator Clinton made it very clear yesterday. She is not going to participate. And Chuck Schumer, the other senator, is on vacation right now and there were some initial indications that he was going to participate. We're not quite sure right now. But even the state Democratic chairman, a very colorful figure named Denny Farrell (ph). He's even concerned that this might be seen the wrong way and he said yesterday that he might not even participate if this becomes, and this is his own words, a real stink-a-rooni. So there is some concern at the Democratic camp that this might not play very well.

KING: All right, Joel Siegel of the "New York Daily News." We'll check in as all this plays out in the days and weeks ahead. Thank you very much.

SIEGEL: Thanks, John.

Is the Bush administration using the fate of a Navy pilot to lay political ground work for an attack on Iraq? That story is next. And we'll talk with Republican Senator Chuck Hagel about his disagreements with the president over Iraq and the economy.

Some critics have tried to make Bill Clinton a political liability for his wife. Now find out who is trying to use the New York senator as a political weapon.

And is there a shaman in the house? The spiritual leader ward off bad political vibes.


KING: On the record this Wednesday, U.S. policy toward Iraq and the status of a U.S. Navy pilot shot down during the Gulf war, more than a decade ago. Captain Scott Speicher was officially listed as killed in action. But reports and rumors persist that he may have survived the crash of his FA-18 jet and was possibly even taken captive by Iraq. Speicher's status was changed to missing in action shortly before President Clinton left office.

With me now from the Pentagon is Barbara Starr with new information on how the Speicher case could affect U.S. policy towards Iraq. Barbara, leading officials now pushing to change that status yet again.

BARBARA STARR, CNN PENTAGON CORRESPONDENT: That's right John. What we've learned here at the Pentagon today is that officials are now seriously considering changing Speicher's status yet again and now listing him as missing and captured.

Now this would be extraordinary because there is absolutely no evidence, we are told, no new evidence, that Scott Speicher is alive. There have been a number of suspicions over the years that he possibly did survive those initial moments of ejecting from his aircraft. And there is a strong belief that the Iraqis know exactly what happened to him, and they've never told the United States.

They've never made a clean confession about what happened to Scott Speicher. So now, led by Deputy Defense Secretary Paul Wolfowitz, a hardliner against the Iraqi regime, there is a strong move afoot to reclassify him as missing and captured, and the belief is, they think, that this could pressure Iraq politically or at least help make the case with the American people that possibly a U.S. serviceman is seriously unaccounted for and help build the case politically against some kind of action against Iraq.

KING: Well, Barbara, what is the reaction you've been able to gather from the uniform leadership at the Pentagon. A civilian, Mr. Wolfowitz pushing this, what do the uniforms think?

STARR: The uniforms really do believe it's politically generated. It's extraordinary for someone to consistently be reclassified like this. One Navy officer saying to us today, this could wind up being nothing more than another reason for bombing Iraq.

KING: Barbara Starr at the Pentagon keeping track of a remarkable story. Thank you very much.

U.S. policy towards Iraq is just one of the issues to cover with Senator Chuck Hagel, a Nebraska Republican and member of the Foreign Relations Committee. Senator Hagel joins us now live from Capitol Hill. Senator, just to the issue we were just discussing with Barbara Starr. Any reaction at all to these efforts in the case of Captain Speicher?

SEN. CHUCK HAGEL (R), NEBRASKA: Well, John, I don't think we should jump to any conclusions here. I have confidence in the president and the secretary of defense that they would not play a political game here with Captain Speicher's fate. This is about a human being, a family, someone who contributed, served his country.

I just don't believe that no matter what is reported, that this president, this secretary of defense would use Captain Speicher's status as an excuse to further leverage war against Iraq. And I think we should play this out, as we do with any one of our military men or women when their fate is unknown, take it as far as we can, but in the end, if there is no evidence, then we will have to deal with the reality if that is what it finally ends up to be.

KING: It is well known, sir, you are a skeptic when it comes to going to war with Iraq. During the August recess, while Congress is home, the House Majority Leader Dick Armey says the administration should not go launching an unprovoked war. Iraq says inspections are done. Are you still skeptical today? Has the president made the case, and in your view, is a military response the best on the table right now?

HAGEL: I don't think the president has made his case to the American people as to why we should go to war with Iraq. But I don't think he set out to do that, to make that case yet. It's important that we play through the diplomatic options here, the political options. We always have the option of going to war. It's easy to get into war, not so easy to get out.

If we would go to war with Iraq, and it may well be that is the only option left at the right time, the timing is important here. The urgency of the threat, the consequences of action. Would we do it with other allies? Could we do it unilaterally? Should we do it? What comes after Saddam Hussein? These are very important questions what that we need to think through. The administration has been talking about possibilities. I understand that. The president has an obligation, the Department of Defense, to play through war games and look at contingencies.

And as far as I'm concerned, that's what they are doing now. But I think Congressman Armey and others who have asked some questions, as I have been asking, are the legitimate questions and the right questions to ask.

One other thing on this, John, and not to draw too fine a point to this, but we got into Vietnam because we didn't ask any questions. And I'm not saying that this is Vietnam, many differences, many different dynamics, but if you make a commitment to undertake a regime change and you do that through the military option, with all of the consequences that will flow from this and there will be many unintended consequences, that we better prepare the nation here for what we are doing, make sure they are going to be able to sustain any effort, because there is going to be a considerable effort after the military options.

KING: Senator, let's move on to the economy. President Bush staged an elaborate economic forum yesterday in Waco, Texas. He's on the road today. A half dozen cabinet members at that forum. One of the main goals was to quiet critics who say this president does not have the right policy, and as Senator Chuck Hagel has questioned, whether he has the right team. Your reaction to the forum. Do you think this president needs to shake up the team and do you think he needs to change the policy?

HAGEL: Well, first of all, what's going on in the stock market, going on in our economy today is not the president's fault. He inherited the economy and let's not forget that he and the vice president warned, as they were taking office, that we were likely to be in for a recession. That's not too far from where we have ended up.

However, that isn't the case really that's most important now. He is the president. He must lead. The American public, as the world, must look to the president of the United States, for leadership. What we saw in Texas yesterday, was OK. There is nothing wrong with bringing a forum together to get various ideas. But that's not going to change the dynamics of the economy.

I think the president should look at his team. I think he should look at what kind of a team does he need, an economic team, that can deal with these issues, these complicated economic global issues out front, explain the president's position, deal with him on the inside, how and where he must. But I don't think up to this point, there's been a great amount of confidence shown in his team. Now that may be the way they wanted it. It may be the way he planned it.

But when the economy goes down, there are also consequences to that. And the president has time to deal with this, and I think showing the American public the world yesterday, that he is going to start dealing with it; that's a good first step. But again, we always tend to overemphasize the president's role and minimize, I think, the fact that the markets are the markets. But the fact is, there is an expectation for the president of the United States to lead and articulate his economic message.

KING: All right, Senator Chuck Hagel, Republican from Nebraska. We thank you for your time today on INSIDE POLITICS.

HAGEL: Thanks, John.

KING: Take care, sir.

The first lady is back home in Texas. And she's stepping out as a political fundraiser. The lowdown on her big event coming up. But first, let's join Rhonda Schaffler at the New York Stock Exchange for today's market update -- Rhonda.



KING: Among the stories in our "Newscycle": The month-old baby taken from her mother's car in Texas yesterday has been found unharmed. Police located the little girl during a traffic stop about 130 miles from where she was abducted from her mother's car outside a Wal-Mart in Abilene. A woman who was with the baby today has been taken into custody.

With us now: Mindy Tucker, communications director for the Republican National Committee; and Ann Lewis, former counselor to President Clinton.

Today is an anniversary -- the 67th, I believe -- of Social Security. It was to be a major issue in this campaign. Some say it still might be.

President Bush, Mindy Tucker, at one point said he would debate the Congress this year even in an election year -- his proposal: to allow investors to take a small portion of their Social Security money and put it into stocks. It's disappeared.

MINDY TUCKER, RNC COMMUNICATIONS DIRECTOR: It's still a very important issue and will continue to be. He has shown leadership by just addressing this issue.

What the Democrats do typically is politicize it. They take it. They try to scare seniors. And it is impossible to have a productive discussion about this important issue, bring people together, and get to solutions when you do that. It's unfortunate. We're just going to have to wait until they decide they're ready to come to the table in an honest and open manner.

But I think Ann can agree it's something that needs to be dealt with. She is the head of the Women's Vote Center -- can agree. This is an issue that disproportionately hits women, especially older women. It is something that needs to be dealt with. We need to address it. We need to do it in a nonpartisan, nonelection-year fashion. KING: It's a debate segment, but you can agree if you want.

ANN LEWIS, DEMOCRATIC NATIONAL COMMITTEE: Let's have a factual debate. I would be happy to do it. And I just wish Republicans would be as forthcoming and Republican candidates would be as forthcoming as Mindy is, because what we're seeing is Republicans saying: "Oh, no, we don't want to talk about it this year. Oh, no. Who, us? We don't want to privatize Social Security."

Now, let's be clear. Last year, the Republican Party did want to privatize Social Security. President Bush appointed a commission on Social Security. Every member was committed to privatizing. This year, they took a poll. They found out the American people don't want to go that direction.

I should explain to our viewers that privatize is basically a Washington word that means takes the money out. Well, if you take the money out of Social Security, you weaken the system. That's the wrong direction. But let me tell you, we would be happy to have that debate right now. I wish Republicans would step up to the plate, because, if we don't have that debate now, my concern is that Republicans will hide their agenda, and when the election is over, this plan is going to come back.

In fact, Treasury Secretary O'Neill has said, "We're going to talk about it in 2003."

KING: Let's move on to the broader issue of the economy. We're not going to settle that one today.

The president had this forum yesterday -- some scathing criticism from the Democrats, but also some pretty skeptical reaction in major newspapers around the country. I want to show our viewers and to you two a few headlines.

"The Des Moines Register" masthead over an editorial: "People have to feel confident, so they'll start buying stuff. Well, duh. But people need a reason to be confident. That's what is missing."

"The Washington Post": "Some people thought Mr. Bush is doing a magnificent job, while others insisted that he is doing an extremely magnificent job." There's skepticism there, if you didn't note it.

And in "The Wall Street Journal": "Everyone's sisters, cousins and aunts expected absolutely nothing from Waco. Early reports suggest they were right."

How do you answer that?

TUCKER: Well, there is a lot of cynicism. It is unfortunate that you can't bring people together and have a good discussion of issues anymore, because somebody has to be cynical about it.

KING: Isn't that what we're doing here?


TUCKER: I hope not.

But, frankly, this was a group of people that got together, a unique groups -- farmers, small-business people, people that are on the front lines of the economy -- getting together to talk about the problems. They expressed some concerns. The president shares a lot of their concerns. They expressed their optimism about the economy. It was a good exchange of ideas.

And the Democrats have to find a way to politicize it. They have to be on the opposite side of whatever we're doing. So they come up with a slogan. They say it's a fund-raiser. They say no Democrats are there. It's just not true. It wasn't a fund-raiser. There were Democrats there. It was a wonderful exchange of ideas. Is it going to be the end-all, be-solution? No. Nobody expected it to be.

KING: Ann, why can't the president bring some friends together and have a talk?

LEWIS: He certainly can bring friends together, but, please, let's not call it an economic forum.

Look, I think it was remarkable, and, to Mindy's point, actually admirable, that the White House political office, on the same day that the Federal Reserve gets up and says, "We have real concerns about this economy," on the same day that major employers are laying people off -- including one of the speakers of the president's own forum, whose company announced that they were laying off thousands of people -- on the same day these events are happening, the White House finds 250 people who can come together and say everything is going to be just fine.

KING: OK, we need to stop there, but I'm sure this will continue to November and beyond.

Mindy Tucker, Ann Lewis, thank you very much for joining us today.

Politics, Texas-style, coming up next: We'll get the "Inside Buzz" on new White House connections to the heated Senate race in the Lone Star State.


KING: First ladies, past and present, are influencing the Texas Senate race today. Laura Bush appeared at a luncheon in Austin for Republican Senate nominee John Cornyn. Meantime, across much of the state, the Texas Republican Party is running a new TV ad against Cornyn's Democratic opponent, Ron Kirk.


NARRATOR: Ron Kirk, he opposes President Bush on conservative judges, like Texas's own Priscilla Owen, a bipartisan choice in Texas, but opposed by liberals like Hillary Clinton. No wonder so many liberal special interests are aligned with Kirk against conservative judges.


KING: An effort there by Texas Republicans, clearly, to link Kirk to Senator Hillary Clinton. I recently asked Kirk about that strategy.


RON KIRK (D), TEXAS SENATORIAL CANDIDATE: That message isn't going to sell. My opponent is going to have to stand up and be a big boy and run on his own. And he's not going to get away with trying to typecast and stereotype me.

My opponent has taken every opportunity he's had to be statesmanlike and made a hard right turn and taken a very partisan way. And while Texas is a conservative state, it's not that partisan a state in that sense. And I believe, at the end of the day, my message of bringing people together to solve problems is what is going to propel me to success in November.


KING: With us now for more from Texas: David McNeely of "The Austin American-Statesman."

David, I have to assume that, if Ron Kirk says the strategy would not work, the Texas Republicans must think it might work.

DAVID MCNEELY, "AUSTIN AMERICAN-STATESMAN": Well, obviously, by running that ad, they think that they're getting something by trying to link him with Bill Clinton and Hillary Clinton.

I'm not sure that perhaps some of the bloom hasn't worn off that rose. It's been a few years now since the Clintons were in the White House. So, I don't know whether, as we say in Texas, that dog will hunt anymore or not.

KING: Give us your sense of the lay of the land in that Senate race, a critical race. Right now, I'm looking at some polling recently showing either a dead heat or perhaps one candidate up just a little bit. Is that a fair assessment?

MCNEELY: Well, it seems to be. Montgomery & Associates had a poll that came out today that shows the two in a dead heat at 46 percent each. And I have nothing that would cause me to believe different than that.

I think one of the reasons for that -- Montgomery says, anyway, and I believe it -- is that Ron Kirk has been the popular mayor of Dallas for the last half-dozen years. And I think that he is well regarded in that Northeast Texas area, which is about one-fourth of the state of Texas, when you take in all the various media markets that come out of Dallas. So, that's helped him. And that's an area that normally a Republican has got to have a pretty big lead in to win statewide. KING: Democrats seem to think they have a chance to win the governor's race as well. Help our national viewers understand this. This is President Bush's state. And I would presume he is still quite popular there.

MCNEELY: The president is quite popular here.

But this is the first race in three when he hasn't been on the ballot, and only, I think, the second in five or six when there hasn't been a Bush on the ballot somewhere. And so I think one of the things that's going on this year is, the Republicans are -- sort of as Ron Kirk was saying in your lead-in there -- having to figure out how to kind of stand up on their own.

Now, Laura Bush was down here today raising money for John Cornyn. And President Bush had done so earlier in Dallas. The question is how much -- that will certainly help them financially, but whether the endorsement alone helps push them any closer to the line is another question.

KING: Help us a little bit behind the scenes in that Senate race. The Republican, John Cornyn, has not only a friend in the president in the White House, but a close friend in Karl Rove, the president's top political strategist, does he not?

MCNEELY: He does.

It was my buddy Karl Rove who more or less drafted Cornyn to run for that. He had helped him when he ran for attorney general. And Karl sort of orchestrated it so that no one else significant ran against Cornyn for the Republican nomination for the Senate. So, there definitely is that arm around there. And then, with the Senate so closely divided, and this being the president's home state, there's a little more there to bear.

Now, on the other side of the coin, if Ron Kirk is elected, he would be the first African-American senator from the old South elected since Reconstruction to the U.S. Senate.

KING: All right, David McNeely of "The Austin American Statesman" -- races to watch in Texas -- we hope you'll keep in touch with us at INSIDE POLITICS.

MCNEELY: Thank you, John.

KING: Thank you.

We'll have some laughs with "Saturday Night Live" star Darrell Hammond when we return.

And later, Bruce Morton will show us the sights at the Iowa State Fair.

And stick around to find out the answer to this quiz question: "Who was the first U.S. president to visit the state fair in Iowa?"


KING: Checking the headlines now in "Campaign News Daily": Washington, D.C. Mayor Anthony Williams' campaign has been fined $277,000 for violating the city's election code. The election board found more than 5,000 forgeries on the election petitions submitted by the Williams campaign. Because of the forgeries, Williams will not be on the ballot. He is running for reelection as a write-in candidate. This afternoon, Mayor Williams vowed to pay the fine, but he didn't say when.

The town council in Telluride, Colorado, has taken an unusual step, to say the least, to improve sometimes-stormy relations among its members. The council recently brought in a shaman, sort of like this guy, who declared the council chambers full of negative energy. The shaman held what's called a smudging ceremony, which included the burning of imported menthol to get rid of the bad vibes.

And, in Georgia, the bad vibes seem to be growing between Republican Congressmen Bob Barr and John Linder. Over the weekend, a man dressed as cartoon gunman Yosemite Sam showed up at a Barr rally, apparently to make light of a recent incident involving Barr and a misfiring handgun. As you can see, a man later identified as Congressman Barr's son got into an altercation with the demonstrator. Barr has called on Linder to change his campaign tactics. Linder denies any association with the protester.

Washington's most powerful leaders, past and present, are frequent targets of comedian Darrell Hammond of "Saturday Night Live."

Our Jonathan Karl recently caught up with Hammond outside the White House.


JONATHAN KARL, CNN CONGRESSIONAL CORRESPONDENT: Now, you made a name for yourself doing Bill Clinton.


KARL: You had Bill Clinton. You spent a lot of time studying the tapes, watching him do it.


HAMMOND: These are important people who get elected for two whole years.


HAMMOND: Al, please.


HAMMOND: I'll tell you when I got a sense of Bill Clinton. I'm performing at my second correspondents dinner. And he's sitting right next to me looking up into my face. And I opened with a joke. (BEGIN VIDEO CLIP)

HAMMOND: If you'd only take your clothes off and let me see you naked, there would be no more racism.



HAMMOND: Bill pauses. And I saw that machinery sort of whirring quick in his head. And he turned to an African-American woman sitting next to him and kissed her -- enormous, enormous applause and a sort of a piranha feeding frenzy of photographers. And I thought to myself, his sense of theater is just astonishing.

KARL: It's amazing.

Now, what about the new team? What about the Bush team? Rumsfeld, for instance, what's the key? Give us a sense of Rumsfeld. And what is it like doing him?

HAMMOND: Well, I hope to meet Donald Rumsfeld one day and see if my sense of him is right.

But my sense of Donald Rumsfeld is that he's like a man trying to land a crowded 747 on a crowded interstate at rush hour. And then a reporter may come up and say something: "Aren't you going to watch out for those birds? Watch out. Oh, you hit a bird."

And he sort of looks at people, like, with that squint in his eyes. And the shoulders go back. He may something like: "The al Qaeda are spiritual people who think they're going to find God by dying in a war with the West? Screw it. Let's help them out," you know?


KARL: Donald Rumsfeld, he wanted you to come by and see him, right?

HAMMOND: Right. He wanted me to come to an actual press conference. And when it was time for the defense secretary to walk out, he wanted me to walk out and answer questions from reporters.


HAMMOND: Remember what I said about your question the other day?

WILL FERRELL, COMEDIAN: That it was idiotic?


FERRELL: And that I'm an embarrassment both to myself and to my newspaper?

(LAUGHTER) HAMMOND: That's right.


HAMMOND: I know at one point someone asked him, "What did you think of your portrayal on 'Saturday Night Live'?" And he squinted, and his shoulders back. And he said: "You know, when I want to talk about "Saturday Night Live..."





KARL: You don't just do the politicians, though.

HAMMOND: I performed once at a tribute for Ted Koppel in New York. And I was to go out. And this is one of the more embarrassing things that ever happened to me. But I was supposed to go out dressed and made up as Ted Koppel and interrupt Sam Donaldson as he gave a slightly moist appreciation of his friend Ted Koppel.

And there was Sam, the tie loosened. And he was out there saying: "And then we chartered a plane. And we were in St. Louis. I said: 'Ted, you test the elasticity of my credulity. The mills of the gods grind slow, but exceedingly fine," or something alone long those lines. I'm paraphrasing, but not too loosely.

And then I turned and looked at Ted Koppel. And I don't know why. He terrified me for a second. I looked into that 1,000-yard stare of his. And all I could say to him in his own voice was, "Are you mad at me?" And he said: "No, I'm not mad at you. Give me the microphone." And he walks over to Roone Arledge and he says: "Roone, you cheap so and so, if you paid me a living wage, I'd be able to afford a decent rug like this actor has on."

Big applause. The house came down. And then he made me relax and even let me sit at his table.

KARL: Well, Darrell, thank you very much for joining us.

HAMMOND: It is an absolute pleasure to be on INSIDE POLITICS.


KING: And a pleasure to have him.

We head back to the Iowa State Fair with an expert, Bruce Morton, as our guide next.

Also ahead: batter up. The political parties take the field for softball bragging rights.


KING: We asked you earlier: "Who was the first U.S. president to visit the Iowa State Fair?" The answer: Dwight Eisenhower back in 1954. If you got it right, raise your hand.

There are many attractions at the Iowa State Fair and today's appearance by President Bush is just one of them.

CNN national correspondent Bruce Morton is our tour guide.


UNIDENTIFIED FEMALE: Welcome to the Iowa State Fair, home of the world-famous butter cows sculpted by Norma Lyon.

BRUCE MORTON, CNN NATIONAL CORRESPONDENT (voice-over): About a million people come to the fair every summer. And the butter sculpture may be the most popular attraction. There's always a cow and always something else as well. This year, it is the characters from "Peanuts": Charlie Brown, Peppermint Patty, and Franklin. We looked for the little red-haired girl, but couldn't find her.

Of course, there's all kinds of other stuff, too: a vine maze for kids to crawl through. There are rides. And if you're this age, what could be more fun than this? But it's a real fair: cattle judging, livestock and so on. This is the champion Charolais bull. He weighs 3,110 pounds. Yes, that is more than a ton and a half. They offered to get him to stand up for us for our picture, but we didn't want to bother it any.

They did get the big boar up for us, but it wasn't easy. His name is Boris, of course, and he weighs 1,121 pounds, lots of bacon. You can see all the animals walking around here and all kinds of people: princesses -- the British royals do that same wave -- and cowboys, and young women in old-fashioned bonnets. Most walk. Some sit. And the food, well, you wouldn't believe it all: turkey legs.

UNIDENTIFIED MALE: On weekends, we'll go through about 1,000 a day.

MORTON: There are breaded pork tenderloin sandwiches, big, and sizzling meats.

UNIDENTIFIED MALE: Pork loin and sirloin.

MORTON: Walks rides, souvenirs. This salesman has a cap in mind for Paula Zahn.

UNIDENTIFIED MALE: I think Paula would like that.

CHOIR (singing): This joint is jumping.

MORTON: And there's music, all kinds of music. This is the Colfax-Mingo Swing Choir. And they're right. The joint is jumping. The fair is jumping. Just ask anybody.


MORTON: And, of course, there were politicians here. You saw the president. That gets folks in Iowa excited -- other Democrats and Republicans with an eye on this office or that.

But this is a fair. And, really, on this gorgeous August day, it is probably fair to say that the funnel cake, the cows, real and butter, got more attention than even the president of the United States.

John, you should have been here.

KING: I wish I was there, Bruce. I've got a pretty good gig this week, but you're doing even better.

Bruce Morton, joining us live from the Iowa State Fairgrounds, have a good day. We'll see you again tomorrow.

And I'll be back in just a moment with the results of a different kind of competition between Democrats and Republicans.

But now let's take a look at what is coming up next on "WOLF BLITZER REPORTS" -- hi, Wolf.


In a moment, heartbreak caught on tape: a baby stolen from her mother in a Wal-Mart parking lot. There is a happy ending, though. The man authorities are calling a person of interest in the anthrax investigation has something more to say. We'll hear directly from his spokesman; and an update on the fate of the first American pilot shot down in the Persian Gulf War.

Those stories right at the top of the hour, right after INSIDE POLITICS.


KING: A quick check now of what's in the works for tomorrow's INSIDE POLITICS: Bruce Morton joins us again from the Iowa State Fair with a political look at who's there and who's not. Also tomorrow, I'll interview the Senate majority leader, Tom Daschle. He'll be home in South Dakota. President Bush will be there as well.

And it wouldn't be late summer in Washington without a little softball between the parties. Last night, the Democratic National Committee and the Republican National Committee took the field in a friendly game of slow pitch. The Democrats came out on top, 16 to 11, despite the pitching and hitting efforts of Republican Chairman Marc Racicot. Fans for both sides were out in force, a partisan crowd in every sense of the word.

That's all the time we have here today on INSIDE POLITICS. "WOLF BLITZER REPORTS" is up next.

I'm John King in Washington. Thanks for watching.


Independent 9/11 Commemorations; Democratic Presidential Hopefuls Flock to Iowa>



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