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CNN CROSSFIRE

Should Government Pass Another Tax Cut?; What Do We Know About al Qaeda, Iraq?; Fast Food Industry Hit With Lawsuit

Aired September 2, 2002 - 19:00   ET

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


ANNOUNCER: CROSSFIRE. On the left, James Carville and Paul Begala. On the right, Robert Novak and Tucker Carlson.
In the CROSSFIRE, want another tax cut? How about more corporate reform? Now that their vacations are over, what should Congress and the president do to make your job and their jobs easier?

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: You need to have more money in your pockets, as far as I'm concerned.

(END VIDEO CLIP)

ANNOUNCER: Missing the clues and pointing fingers. Tonight, what we should have known before September 11, and what we think we know about Iraq.

And they've supersized the fat, supersized the portions and supersized you. Now the fast food industry's been hit with a supersized lawsuit. Tonight on CROSSFIRE.

From the George Washington University, Paul Begala and Tucker Carlson.

PAUL BEGALA, CO-HOST: Welcome to CROSSFIRE, and happy Labor Day. Today, of course, is the start of the political season, so while nearly other political cable talk show is in reruns on this Labor Day holiday, "Crossfire" is coming to you live, laboring away with our special Labor Day guest, the working man's friend, Ralph Nader. He and conservative economist Stephen Moore will be out here in a few minutes.

And later, the man who decided the fast food industry deserves a big, fat lawsuit.

But first, since we are live on a big political news day, let's begin with our labor of love, the CROSSFIRE "Political Alert."

The only president we have celebrated Labor Day today by pretending to care about working people for a day. President Bush visited a Pennsylvania picnic hosted by the United Brotherhood of Carpenters and Joiners. He neglected to tell the carpenters why he opposes increasing the minimum wage, why he repealed workplace safety rules put in place by President Clinton, rules by the way that prevent on the job injuries, and why he's threatening to veto the Homeland Security bill unless Congress adds anti-union amendments.

Why does Bush take such anti-labor positions? Because his corporate fat cat owners tell him to. You see, today may be Labor Day for you and me but for George W. Bush, every day is corporate contributor day.

TUCKER CARLSON, CO-HOST: Really? Is that right?

BEGALA: Yes.

CARLSON: I wonder why almost half of all labor guys voted for Bush in 2000.

BEGALA: Thirty-seen percent.

CARLSON: I bet you it's almost half, because -- because, first of all, the carpenters don't work for minimum wage. And second, he has the same values they do; they know Democrats have contempt for the individuals in unions.

BEGALA: I don't think so.

CARLSON: Secretary of State Colin Powell has told the BBC that U.N. weapons inspectors ought to return to Iraq. Powell also says the debate among the international community needs to be held before the U.S. takes any action against Saddam Hussein.

These were comments which reportedly surprised officials at the White House. They've been down playing what clearly seems to be a case of top officials not being on the same page.

"TIME" magazine, meanwhile, reports Powell has had firm plans to leave the administration at the end of the president's first term. According to an unnamed aide, the Secretary of State's position is, quote, "I did what my heart told me to do. I got Bush here and set him up. I did the best I can do."

Egomania, of course, is Washington's most common virus and the Secretary of State has a bad case. It's time for a vacation.

BEGALA: Of course Colin Powell didn't get him there, it was Chief Justice Rehnquist did. We should give credit to the chief justice there.

CARLSON: I like Colin Powell.

BEGALA: It wasn't Colin Powell, you're right.

CARLSON: Voters got him there.

BEGALA: Labor Day, of course, is the start of the political season, as we've been telling you. In the election year, it looks like Democrats are coming out of the starting blocks looking pretty strong. A new "Los Angeles Times" poll shows that Democrats who last year trailed the GOP by five points now have an eight-point advantage in the upcoming congressional elections. Meanwhile, President Bush's job approval rating in the latest CNN/"TIME" poll is at its lowest levels since before the September 11 attacks and Vice President Cheney's favorability rating is below 50 percent.

Asked to comment, Bush said, quote, "Polls don't decide elections. My daddy's pals on the Supreme Court do."

CARLSON: Vice President Cheney? If you're quoting Vice President Cheney's approval rating, the vice president who wanted nothing to do with anything, that's grasping at straws, Paul, even for you. Honestly.

BEGALA: Bush is down at his lowest level.

CARLSON: Way above 50 percent.

BEGALA: He's lower than Clinton during the Lewinsky scandal. We should get him a girlfriend; he'd move up.

CARLSON: Ew, ew.

The first rule of politics is there's no reason to humiliate yourself if you're going to lose anyway. Andrew Cuomo has ignored this rule. Cuomo, the son of the former failed governor of New York is running for governor himself. There's no chance he, or his primary opponent, State Controller Carl McCall will be will beat Republican George Pataki in the fall, but that doesn't stop them from acting foolish, Cuomo particularly.

Yesterday, Cuomo did some fruitless campaigning in the Bronx. With him was actor Joe Pantoliano, who plays a murderous Mafia thug in HBO's "The Sopranos." By itself, this would be amusing. Given that the Cuomo family has campaigned to stop the ethnic stereotyping of Italian-Americans, it's embarrassing.

Cuomo's defense, quote, "A lot of people watch the show." Which is true, more than will vote for Andrew Cuomo.

BEGALA: If I lived there, I would vote -- I love Andrew Cuomo, and I love "The Sopranos." I think it goes great together. Good for Andrew. You're just worried that he will win and then he'll be able to knock off Pataki.

CARLSON: If he -- Come on -- He and Janet Reno have about the same chance. Come on, Paul.

BEGALA: Well, they're actually running in different states. Anyway, Andrew's going to do great.

The Associated Press reports that the Saudi royal family is vacationing in Spain, where the attractions include gambling, discos and topless beaches. Odd diversions for a kingdom supposedly based on the strict practices of Islam.

One vacationing Saudi royal told the AP that the September 11 attacks were arranged by the Israelis and the American government. Quote, "Do you know how many Jews in the World Trade Center didn't go to work in that day?" he asked.

No, but I know of at least one Saudi idiot who hasn't gone to work a day in his life and ought to know better than to blame America or Israel for terrorist acts by Saudi citizens.

CARLSON: It's actually -- It's actually even worse than that. It's worse than when Israel was blaming Jewish Americans for the attacks. It's disgusting; I agree with that.

When you think of international moral leadership, you think Germany. Actually, you don't. That's a joke, of course. But the German government would like you to. Which may explain why Berlin is threatening to withhold key evidence in the trial against suspected terrorist Zacarias Moussaoui. Moussaoui is believed to be an Al Qaeda member, possibly even the so-called 20th hijacker.

Germany's justice minister says he would love to help bring Moussaoui to justice, but he may not be able to, since the U.S. still enforces the death penalty. In other words, September 11 was bad, but the American justice system, now that's just completely barbaric.

Call it moral leadership, German style.

BEGALA: You know, this summer Turkey joined the civilized world in abolishing the death penalty. It leaves America out there with Iran, Iraq, communist China, as the chief users of the death penalty.

CARLSON: I'm not supporting the death penalty. I don't support that kind of government intervention, along with many others. However, for Germany to morally preen and lecture us about human rights, is just -- it's revolting.

BEGALA: It is.

CARLSON: It's outrageous.

BEGALA: And it's more outrageous when they're right. And of course they're right.

CARLSON: They're totally wrong.

BEGALA: They're right.

CARLSON: To help bring a suspected terrorist to justice? Come on!

BEGALA: Well, they're right about criticizing the American death penalty.

Well, August is over and Congress is back in town, the elections just down the road. Have you noticed that our president's stump speech hasn't really changed for weeks? Maybe his speech writers are on vacation or maybe, just maybe, he's not fully capable of any fresh, original ideas. Today, for example, he called for curing our economic doldrums, doldrums caused by his big tax cut for the rich, curing them by, you guessed it, more tax cuts for the rich.

In the CROSSFIRE tonight to talk about politics and your money, consumer advocate, former presidential candidate, Ralph Nader. His book about the campaign is called "Crashing the Party: How to Tell the Truth and Still Run for President."

With him is Stephen Moore, the president of Club for Growth.

CARLSON: Ralph Nader, thanks for joining us. I can never see you without feeling the same way, and which is grateful that you helped elect our president and defeat Al Gore. So thanks very much for that. I want to...

RALPH NADER, CONSUMER ADVOCATE: In fact, Gore won the election. I keep telling you that.

CARLSON: I know. Right.

Anyway, speaking of corporate malfeasance and Cisco Systems, one of the many companies whose practices are coming under close scrutiny. In the -- at the end of 2000, Cisco System reported income of $4.6 billion. It turns out they didn't take into account a lot of things, including stock options. Had it been adjusted, it would be been $2.74 billion. Almost $2 billion, looks like, they inflated their earnings.

At exactly the same time this was taking place, you owned $1.2 million worth of Cisco stock, part of the $3.8 million you reported that year in income -- in holdings. I'm wondering if you'll do your part by giving that money to some of the poorer shareholders who were apparently misled by Cisco.

NADER: Well, we're going to organize shareholders on Cisco. The people who own these companies should control the management, make Cisco expense their stock options. By the way, that is nowhere near worth what it was, as you know. Everything went down with the stock market.

CARLSON: Well, I know, and I feel bad. I mean, for someone -- for someone as rich as you, don't you think -- and as someone who is a huge shareholder -- $1.2 million in one company -- Where were you? Why weren't you pushing Cisco to account stock options in their accounting?

NADER: Well, we are. In fact we're...

CARLSON: Were you then?

NADER: Not then. We were trying to stop Cisco from opening a -- a development in the Valley; it was disrupting a lot of people in California. We had a press conference attacking Cisco, as part owners of Cisco. That's what we call conflict against interest. That's what shareholders should do: go after crooked management or negligent management... CARLSON: Wait a second. They were inflating their earnings. Why weren't you on the phone with "The Washington Post" saying, "Hey, you know, I've got $1.2 million in this company. But it doesn't matter, they're inflating these earnings." Couldn't you...

NADER: Because that wasn't disclosed until recently, thanks to the Republican party.

BEGALA: Well, let me bring you in. Happy Labor Day.

STEPHEN MOORE: Thank you. Same to you.

BEGALA: Every day, of course, is capital day for Stephen Moore.

MOORE: By the way, I'm so glad to see that Ralph Nader is a capitalist. I didn't know you owned stock.

BEGALA: Well, of course you're happy, but the question is...

NADER: You've got money in your bank account.

BEGALA: But Bush is not, is what he pretended to be today, a friend of the working man. I mentioned earlier that he went and had the gall to speak to a group of union carpenters today. He opposes the minimum wage, he repealed Clinton's workplace safety laws, he's holding up the anti-terrorism bill for it to have union busting language put into it.

Can you think of any other president more pro-corporate and anti- union than the one we've got right now?

MOORE: Well, George W. Bush is not pro-big government as are, Paul. But you know what? In the next couple of weeks, George W. Bush is going to come out with a tax cut that is going to be aimed right at those investor workers. We've got something like a hundred million American workers who are investors, who want to a cut, as a matter of fact, they want a tax cut, they want deduction of dividends. They want something that will get the market back up, and Bush is going to propose it and your Democrat friends are going to be on the side of big government and not on the side of the investor.

BEGALA: So the answer is no. You can't be any more pro- corporate, anti -- You really think, like, those union guys swinging those hammers in the carpenters' union, that they want -- it's for the wealthiest 1 percent to be able to deduct the money that they invest in a yacht?

MOORE: What they want is good jobs at good wages, and they know -- they know the way to do that is to cut taxes, get the taxes down on investments so have more capital here in the United States. That's how you create jobs. That's how it happened in the 80's.

Actually, even when Bill Clinton was president, he signed a capital gains cut. And what happened? We got more revenues, more jobs and the market went up. Let's do it again. Let's do it again, Paul. BEGALA: We just -- We just did it with Bush, and let's look at the results: $4.4 trillion in investments gone. One point eight million people who had jobs when Clinton was president, their jobs are gone. Unemployment at 3.9 under Clinton, 5.9 under Bush.

MOORE: You know what? They say that...

BEGALA: At what point do you say, "We have failed"?

MOORE: You know why the Bush tax cut hasn't worked? Because it hasn't taken effect yet. And the fact of the matter is, that 90 percent of the tax cut doesn't take place until 2005, 2006 and 2007. That was at the insistence of the Democrats. Now they are saying -- Tom Daschle and Dick Gephardt are saying, repeal the tax cut before it even takes place. So how can it work if it hasn't taken effect yet?

CARLSON: And that's an excellent point. Mr. Nader, I doubt -- I know you agree.

NADER: I don't agree. I don't agree that the U.S. government should subsidize losses in the stock market. That's supposed to be against the libertarian viewpoint.

MOORE: Yes, but Ralph, if you have to pay tax on your gains, why shouldn't you be able to deduct your losses? I mean, tax fairness is tax fairness, after all.

NADER: Because one is capital losses and capital gains and the other is ordinary income. You can already deduct up to $3,000, but you want to deduct the losses of billionaires. That's the difference.

CARLSON: A lot of people -- a lot of American have...

NADER: Listen, this is not a slow -- this is not a slow talk program. For people who want more details, just log in MultinationalMonitor.org for the facts. And for the action, CitizenWorks.org. In other words, the case is clear. We're in a corporate crime wave.

CARLSON: Wait a second.

NADER: We don't need to keep belaboring it. It's time for the Democrats to draw a bright line, Paul, with the Republicans for the election. Otherwise, they'll blur the issue on corporate crime. You've been arguing this.

BEGALA: I know.

CARLSON: Ralph, wait a second.

NADER: OK. Go ahead.

CARLSON: When you say we're in the middle of a corporate crime, and doubtless you have more web sites to back it up. You can give us their directions in a minute.

NADER: Yes.

CARLSON: But I want to show you a poll that was just undertaken by Stan Greenberg and James Carville, an agency called the Democracy Core, and it asked Americans, how do you feel about various institutions, organizations in American life. I want to throw it up.

It's fascinating statistics. George W. Bush got 61. This is a thermometer poll. The higher the better. Sixty-one. The Republicans, 54. Democrats, 53.

Big corporations, 43. Green party -- Ralph Nader, that would be you, 39.

So the news here is: big corporations are more popular than you are.

NADER: Really? You want to...

CARLSON: They didn't ask about Satan, though.

NADER: Well, wait a minute. Tucker, you want to test that? Get Madison Square Garden full of people, randomly chosen, and have me debate George Bush or Al Gore or any corporate executive, and if I don't beat them 3 to 1, I'll come on this program even more.

CARLSON: Wait a second, wait a second. This is not -- this is not -- well, you are always welcome here. This is not a test of rhetorical skills, who's able better to demagogue an issue. But if you ask the average person, how do you feel about big business, you don't get a uniformly negative response. Whereas, you're not doing that well, to be honest.

NADER: Wait a minute. How about the "Businessweek" poll, which said 72 percent of the American people think big business has too much control over their lives? How about...

CARLSON: Even more feel you have more control over their lives.

NADER: How about all -- how about all the people that have lost their pensions, who have lost their investments, millions of Americans, playing by the rules, losing trillions to corporations who escape to Bermuda, or buy-and-sell politicians in Washington? Come on, Tucker. Don't you see a corporate criminal when you -- don't you want him in jail?

CARLSON: Absolutely. They're going to jail.

BEGALA: I ask you about one of the...

MOORE: I hope it's Martha Stewart. That's the one I'd like to see -- to see in jail.

BEGALA: Well, let's -- a more famous one, Ken Lay. We don't know he's a criminal, let's be fair. He hasn't even gotten a parking ticket from John Ashcroft and George W. Bush. I wonder why that is, since they were recipients of big money from Ken Lay. MOORE: But he parked a lot of money.

BEGALA: He certainly did. With those guys.

CARLSON: Ooh. Stop that metaphor.

MOORE: By the way...

BEGALA: Aren't you shocked by the fact that on this Labor Day, our president has never once spoken to or met with the largest workers union in America, the AFL-CIO, of which I'm a member. John Sweeney has never met with Bush, but Ken Lay has. Don't we count?

MOORE: But you know...

BEGALA: Where are Bush's priorities?

MOORE: Ken Lay gave so much money to Tom Daschle and Dick Gephardt, I mean this guy gave as much money to Democrats as he did Republicans.

BEGALA: Actually, he gave more money to George Bush...

MOORE: I'll give you one fact. He gave more money -- He gave more money to Enron and he gave more money to the Democrats than he gave to the Cato Institute.

BEGALA: Ken Lay, and his company, Enron, gave more money to George W. Bush alone than every Democrat for every federal office in America combined. That's how much he gave Bush.

MOORE: Well, he gave a lot to the Democrats.

CARLSON: We're going to actually have to take a quick commercial break.

MOORE: What about Martha Stewart? You want her to go to jail, too?

BEGALA: We're going to discuss that in full.

MOORE: She gave a lot of money to the Democrats, and...

BEGALA: The food and the decor would improve greatly.

CARLSON: We're just going to have to break, sir. Our union man, Paul Begala, on the scene.

Coming up, we'll ask our guests why the liberals just can't stand the thought of cutting taxes.

Later, Martha Stewart would never serve it, but you're probably eating fast food anyway. Wouldn't that be your choice?

And our quote today comes from a man who has the whole world's attention. But can we trust anything he says? We'll tell you. We'll be right back.

(COMMERCIAL BREAK)

CARLSON: ... the Cato Institute and the Club for Growth.

Mr. Nader, the CBO, hardly a biased organization, came out with a report earlier this month on the 13th of August, last month, that said that 80 percent of changes in the -- in the revenue projections for fiscal year 2002 were the result of things other than President Bush's tax cut, i.e., the war, the Clinton tech bubble that exploded, et cetera, et cetera.

Why are Democrats -- being an independent, you can tell me -- Why are Democrats pretending it's all the fault of the tax cut when it's not true.

NADER: First of all, they know that Mr. Bush is vastly expanding the military budget and the Homeland Security budget. So how do you increase expenditures and then want a tax cut after Bush has given a trillion dollar tax cut over a number of years to the wealthy in June 2001?

The second point is even clearer. What is the purpose of a tax cut if it doesn't really help the people who are pressed in paying their mortgage payments, blue collar people and others, who are making less than $50,000 a year? That's not where the tax cut is going.

CARLSON: Well, wait a second. Not everyone made $13 million like you.

NADER: Rebates.

MOORE: Did you get a rebate?

CARLSON: That's $100 an hour.

NADER: It's not the rebates people laughed at it.

CARLSON: It's for a rich guy. It's for you. You're the person...

NADER: No. First of all, people under $30,000 didn't get anything. It was only the people in the mid-sector ...

MOORE: If they didn't pay income tax.

NADER: ...that got all of $300. What's the point?

MOORE: If they didn't pay income tax, you can't give them an income tax cut.

NADER: The marginal tax rate, the marginal tax rate is very high on people making $20,000, $25,000 a year.

MOORE: All taxes. NADER: All taxes, right. So the question -- the question is, why is the Republican Party wanting to swell all kinds of expenses, give all kinds of corporate welfare, subsidies, handouts, giveaways, which also deplete the revenue intake, and then they turn around and try to demagogue a tax cut, when everybody knows the tax cuts inescapably go to the rich. I mean, it doesn't make sense. They're trying to have both worlds.

BEGALA: Let's get to this actually, because 80 percent of us pay more in the payroll tax that you just mentioned than they do in the income tax or the inheritance tax or any of the taxes that Bush is cutting. Bush has very carefully targeted the taxes that are paid primarily by the rich. I -- I will gladly join you, and I'd be glad to see you join me in a call for cutting the payroll tax, which working people pay, which would actually create jobs.

MOORE: Actually...

BEGALA: You met with the White House on August 21.

MOORE: Right.

BEGALA: Are they going to call for a job creating tax cut?

CARLSON: President Bush has already talked about that. He has said he wants ...

MOORE: He says he wants to carve 2 to 3 percent out of the payroll tax and let people put that into individual retirement accounts.

BEGALA: That's -- that's...

MOORE: ... the Democrats.

BEGALA: That's to get people to lose their Social Security, Steve.

MOORE: Oh, my God, the Democrats are going all around the country saying, they're trying to ruin Social Security.

NADER: Here's where we're in agreement. Why is the president -- why is President Bush -- why is the president, in a period of deficit, growing deficit, why is President Bush supporting a pay grab for the members of Congress and the top political appointees?

MOORE: Oh, Ralph, the Democrats...

NADER: That's going to be -- that's coming this month.

CARLSON: A pay grab?

NADER: Why does he...

CARLSON: They make so much less than you do for working and do so much more. Give me a break, man. It's not a pay grab. NADER: Tucker -- Tucker, you should give a fraction of the money I've given in 30 years for consumer health and safety and environment and workers.

CARLSON: You still have a net worth of over $4 million. What is this anyway?

MOORE: There's two things that Ralph and I actually agree on. One: No pay increase for Congress until they rebalance the budget. That seems like a no-brainer.

NADER: I agree. Don't you agree with that? Tucker?

MOORE: Let's deal with...

BEGALA: We double the president's salary and he squandered the whole surplus. Bush ought to give back $200,000 a year.

MOORE: Let me tell you the other thing.

NADER: You're giving the top bureaucrats and appointees in the U.S. government a huge pay cut without voting for it. It went through the House, it's going to be up for the Senate. Contact your two senators because that's coming up this month. Senator Feingold is going to fight it.

CARLSON: Ralph, Ralph.

NADER: And then you turn around and say to people, "Oh, no, we're going to freeze the minimum wage. We're going to freeze the minimum wage. We're going to make sure people don't get more than $5.15 an hour.

CARLSON: Wait a second. You make more...

NADER: Federal.

CARLSON: You make $15,000 a speech or more, as you know, good for you. But these are guys...

NADER: Tucker, what are you talking about? This stuff goes to our whole consumer protection movement...

CARLSON: Hear me out. These are guys who maintain -- people who maintain homes in the states here, work 24 hours a day, and you are getting on their case for getting a pay raise that doesn't even bring them to the level, even close to the level of their peers. Please.

NADER: Really? They're in the top 1 percent of income of the United States, the members of Congress. Top 1 percent: 99 percent of the people who pay their salaries make less.

CARLSON: They work so much harder than you, me, Paul. Not Steve.

NADER: Oh, yes. They really work. They just took August off, for heaven's sake. The whole month.

BEGALA: The president's salary is not -- the president is already the beneficiary of a pay raise that was put into place.

MOORE: I'm with you. I'm with you on that on that, Paul. I'm with you.

BEGALA: I think he should give it back. Why is it Bush got...

MOORE: President Bush...

BEGALA: President Bush got rich off a tax increase on poor people, working people. That's where he got it.

NADER: They do not govern by example. They do not govern by example. That's why they're not getting the respect of the American people.

MOORE: You voted for President Clinton. He cut the capital gains rate, it worked. Let's do it again for the investors.

NADER: Kudos -- kudos to California legislature, who just passed a strong corporate crime whistle-blower bill.

BEGALA: Ralph Nader, consumer advocate. Steve Moore, Club for Growth. Thank you both very much for a great debate.

Coming up, the question of truth in advertising. When fast food restaurants say super deluxe, extra gigantic size, do they mean the portions, or the calories, or potentially your health problems?

Later, what we should have known before September 11 but missed. And in our quote of the day, the latest bluster from a leader nobody would miss. Alas, he is with us still. Stay tuned.

These days is seems like everybody is talking about the possibility of an American attack on Iraq to get rid of Saddam Hussein. So what's the man in the center of the bulls eye saying? We've got an answer from Iraqi TV.

While showing these pictures of Saddam meeting with a diplomat from Bella Ruse (ph), the commentator relayed a quote from the Iraqi leader that seems to contain a veiled threat. It is our quote of the day.

Quote, "America believes it should control the world. But some of the world's states have nuclear bombs and this is not feasible."

CARLSON: I -- first of all, I love how you pronounce his name, Sodom (ph). I think it's very amusing. Second, I would say, this is exactly the argument...

BEGALA: What is it?

CARLSON: No, no really, it's great. I'm not criticizing you. This is the argument, though, that many people in the United States, some of them Democrats, I'll admit, are making, that the United States does not have the right to act unilaterally against Iraq. And Saddam here is making. I mean it's a convenient -- I'm not tying the two. I'm just saying, it's the argument the French are making.

BEGALA: Dick Armey is the right-wing leader of the House, a Republican...

CARLSON: That's right. I agree with that.

BEGALA: He's made that argument. What Democrat has?

CARLSON: Oh, well, virtually -- to the extent that any Democrat has stated his position on Iraq, and almost every one is too fearful to do that, this is the idea, France is not with us.

BEGALA: The Democratic leader, with whom I disagree...

CARLSON: In fact...

BEGALA: He sat on this set -- He sat on this set and endorsed Bush attacking Iraq.

CARLSON: That was in April.

BEGALA: The Democratic leader...

CARLSON: That was in April. Ask him again now. He's too afraid; he won't make it.

Walls of fire in the west and a new tropical storm off the east coast. Is it the end of the world? We'll find out in a look at both, next in the CNN News Alert.

But later, a man who says there's plenty of blame to go around for September 11.

And if you want to super size your French fries, why should you blame anyone else for what the scale will say? We'll find out. We'll be right back.

(COMMERCIAL BREAK)

CARLSON: Welcome back. When it comes to spy satellites, commuters and communications intercepts, the United States is an intelligent superpower, but our next guest says we're more like a third world country when it comes to human intelligence, having spies on the ground who knows what the bad guys are up to.

"Washington Times" reporter Bill Gertz is the author of a new book, outlining the intelligence failures that led up to September 11. He says there's plenty of blame to go around. "Breakdown" is already a best seller. Please welcome Bill Gertz to the CROSSFIRE.

BEGALA: Welcome to the program.

BILL GERTZ, AUTHOR: Thank you. BEGALA: Before we get to the substance of the book, I want to talk about the salesmanship of it. I know you -- I'm sure you don't write the press releases for it, but let me show you what you the top of the press release selling this book says.

It says, and I quote, "Gertz obtains highly classified documents." Now, you through that book, profit from the sale of highly classified documents. Just ethically, how do you wrestle with that, given that, say, the spy Robert Hansen is doing a life sentence for selling classified secrets?

GERTZ: Well, I'm a newspaper reporter. I report the news, and if the news is contained in classified documents, we'll report them. In this case, I've got to say, we also withheld a number of important documents at the request of the U.S. government. So there's a balance.

BEGALA: Either you had highly classified documents in that book, which is what your publisher is telling us so we'll buy it, or you withheld them out of patriotism.

GERTZ: I know your point...

BEGALA: I read you in the paper, and I trust that you're a great patriot.

GERTZ: It's a pretty...

BEGALA: But isn't there some patriotic tension in profiting off of selling America's secrets?

GERTZ: No, no problem at all. My conscience is clear. I bring the reader inside bin Laden's organization. I don't think anyone's done that. It's useful in explaining why we missed the September 11 plot, to highlight this, and what's what I did.

CARLSON: OK. One of the points you made, I think you made in the book, you made yesterday on CNN, is in the late 1990's there were no American intelligence officers, CIA officers, on the ground in Iraq. And I think I remember that it was in November '98 that the last weapons inspector was booted out of the country. We knew at that time that Saddam had chemical and biological weapons. Why did the Clinton Administration stand by and not put intelligence sources in on the ground?

GERTZ: Well, it was the CIA. And it was a whole culture of risk aversion. They didn't want to risk the lives of these agents. There was a whole emphasis on technical spying, as opposed to human spying. And I talked to one CIA officer who was in charge of that division. He said, "We didn't run agents in there." They had people in neighboring countries, they had people in stations outside; but they were worried to send people in there, because it was considered too dangerous.

CARLSON: But wait a minute. The CIA is part of the executive...

GERTZ: Right.

CARLSON: ... and sort of -- it's controlled by the president of the United States. Why didn't the then president say, "Look, this guy is a lunatic, he has weapons of mass destruction, let's find out what they are now that the inspectors are out?" Why didn't he do that?

GERTZ: Well, there's always a tension between the diplomats and the spies over whether or not someone gets caught if it will upset something. In the case of the inspectors, I'm sure they were afraid that if somebody got caught doing something, that it would upset their inspection regime, which eventually went out the window in '98.

BEGALA: Let me ask you about Iraq. Today, in fact actually yesterday, our Secretary of State gave an interview to the British Broadcasting Corporation where he seemed to be really diametrically opposed from the position on weapons inspectors that the vice president had just taken.

We're also seeing a very interesting, but public, debate between the advisers of Bush '43, senior Bush, and Bush '01? Now if this man, our president, George W. Bush, can't lead his own administration, can't lead his own family, how should we trust him to lead us into a war in Iraq?

GERTZ: This is a crazy debate. That's all I can say, and I've been in Washington a long time. You -- I think there's two reasons for it. Either one, there's a big fight over whether to use force or go slow. Number two, there's some kind of strategic dis-information.

The idea if that we put pressure on the Arabs, maybe they'll do something. Maybe they'll get something we going. We know there's a covert action program in Iraq to overthrow Saddam. It's certainly got the military people upset, because if you're going to do a military operation, the last thing you want to do is tell people you're coming.

BEGALA: That's a very good point. Now our main military leaders, many of them retired now, very much opposed to this. Look at the lineup of generals, right? General Powell, General Scowcroft, General Shelton, General Schwarzkopf, General Zinni, the former head of central command, General Carp, former head of NATO, and General Hugh Shelton (ph), former head of the joint chiefs of staff, have all, in some form or fashion, criticized or cautioned against this.

I think it's, at least, interesting culturally that the uniformed officers seem to be against this, and the chickenhawks, guys who never served -- I never served either -- but they're not deferring to the military leadership on a military question. Why?

GERTZ: Well, it's a big political debate. You know, I think there are definitely hard-liners in the Pentagon who say, "Look, we can do this, we can do this fast."

I think that the opposition from a lot of the Arab countries is based on that. "OK, if you're going to do it, do it fast, but publicly we're going to oppose it." And then there's the other camp that says, "Oh, it will be too disruptive to our relations," and this is what you kind of hear from the State Department.

Where it shakes down, I'm not sure how it all going to end up. But I'd -- I'd be looking for things to start moving after -- after November in terms of troops and equipment.

BEGALA: Is that right? Is this on -- reporting from the sources you've got?

GERTZ: That's just my gut instinct. Look for things to start moving. I mean, you can't -- you can't do a military operation without big preparation, and I think you need to look after the elections.

CARLSON: Now, tell me, part of your book concerns, of course, the 1990's and the lead-up to September 11. You had Khobar Towers, you had the Africa embassy bombings, you had the USS Cole. And critics have said that Clinton Administration too distracted for a number of different reasons to pay close attention to those and, in particular, to Osama bin Laden. Is that a fair criticism?

GERTZ: Well, as you said, there's plenty of blame to go around. I think the Clinton Administration certainly deserves a lot of it. The sense I get from talking to people in research for this book, that as long as there were terrorist attacks against Americans outside the United States that it was the cost of doing business. I don't think they took the threat seriously enough. I'm certain that the CIA didn't. I mean, they just didn't react. You have a guy who says he's going to blow up Americans and then he starts doing it, and we didn't focus enough attention to it.

CARLSON: Actually...

BEGALA: Bill, let me defend my former boss and former administration, which I served by citing General Don Kerrick, lieutenant general, three-star general who served both President Clinton and President Bush in National Security Council. This is what General Kerrick said to your competitors at "The Washington Post."

Let me quote: "Lt. Gen. Don Kerrick, who served both President Clinton and President Bush, noticed a difference on terrorism. Clinton's Cabinet advisers, burning with the urgency of their losses to bin Laden in the African embassy bombings in 1998 and the [U.S.S.] Cole attack in 2000, had met 'nearly weekly' to direct the fight, Kerrick said. Among Bush's first-line advisers, 'candidly speaking, I didn't detect that kind of focus,' General Kerrick says."

GERTZ: Well, I document the big change. At one of the very first meetings after September 11, inside the NSC, the new FBI director said, "OK, we're going to pursue these terrorists so that we preserve prosecution."

BEGALA: That's right. And John Ashcroft jumped ugly with it.

GERTZ: Slapped down and said, "You know what? You go after these people."

BEGALA: Well, we're talking about before September 11.

GERTZ: Well, that was the approach before September 11. It was -- It was a law enforcement approach. It was -- It was limited to outside the country. There was really no effort -- I mean, the FBI reported to the White House in late 2000 that there were no Al Qaeda cells in the United States. It was spectacularly wrong.

Now the estimate is that there's some 5,000 somewhere in the United States.

BEGALA: That's chilling, but excellent point. Bill Gertz, from "The Washington Times." Thank you.

Still ahead, we'll let you fire back at us. One viewer sent an e-mail pointing out one of the many paradoxes of the Bush Administration.

But next, are we eating unhealthy food because we want to or because the fast food companies make you?

(COMMERCIAL BREAK)

BEGALA: Welcome back to CROSSFIRE. Happy Labor Day. Coming to you live from George Washington University in downtown Washington, D.C.

Hey, gang, we're going to have a show of hands. How many of you had fast food for lunch today? Well, fess up. Come on!

No? Well, a whole lot of us don't have time to cook. Many others of us, myself included, don't know how. But we all know how to eat, and when we go to a fast food joint, why are the choices always limited to fat, fat or more fat?

Next in the CROSSFIRE, John Doyle, the co-founder of the Center for Consumer Freedom, which is an industry group in the food industry. With him, George Washington University law professor John Banzhal. Gentlemen, welcome.

CARLSON: Of all the many things about this suit I find annoying, and I should point out that you were once -- you once made the top 25 Most Annoying People list in the "Washingtonian."

JOHN BANZHAL, LAW PROFESSOR, GEORGE WASHINGTON UNIV.: Also the Top 100 Most Influential

CARLSON: Yes. Maybe there's a connection.

But here's what bothers me the most: It is, fast food is not addictive. Nobody who says it's addictive. That's a true story -- not a single person says it's addictive. Nobody's ever woken up with the shakes after giving up Big Macs. So in that way, it's totally unlike tobacco.

BANZHAL: So you think -- You think it's frivolous?

CARLSON: Not only do I think it's frivolous, I think it's...

BANZHAL: I'm delighted that you think it's frivolous.

CARLSON: Because of the one on tobacco.

BANZHAL: When we proposed suing the tobacco companies, all the talking heads and most of the legal experts said it was frivolous. Now we're routinely winning multi-million dollar -- and in two cases, billion dollar verdicts. And we said, the state should sue for the money that tobacco imposes on their health care...

CARLSON: I know.

BANZHAL: Everyone said they wouldn't win...

CARLSON: The question is how low can America get, I know? But you're not addressing...

BANZHAL: We're going to win.

CARLSON: I'm sure you are, but before you do, I want to you to address a real question.

BANZHAL: All right.

CARLSON: One I hope you'll have to address in court...

BANZHAL: Give me a real question.

CARLSON: ... and possibly in the hereafter. This stuff is not...

BANZHAL: The hereafter? Is he on -- Is he on something? Has he been eating these things? What's your question?

CARLSON: Answer the question. It's not addictive. If it's not addictive...

BANZHAL: So what?

CARLSON: Well, how can you sue the companies for compelling people to eat it?

BANZHAL: We don't sue them for compelling people to eat it.

CARLSON: What are you suing them for?

BANZHAL: Let me back up for a minute and explain to you that most of the tobacco suits did not involve addiction. Secondly, if you looked at the law over the last 50 years, you know that neither contributory negligence nor stupidity is a defense in a product liability suit.

We have lots of situations where people do very dumb things, like standing on the top of step-ladders and putting their hands in the back of TV sets, and if there's no warnings, they'd sue and they win.

CARLSON: But everybody knows this makes you fat.

BANZHAL: And they're not addicted.

CARLSON: Everybody knows this makes you fat.

BANZHAL: Everybody knows that? No, sir.

CARLSON: Everybody. I've taken a poll of everybody. (laughter)

BANZHAL: You've taken a poll of everybody.

CARLSON: Yes.

BANZHAL: But the warnings are not there for the smart people like you. They're for the people who are a little bit dumber or...

CARLSON: Don't forget the poor people.

BANZHAL: Or who are forgetful or impulsive. That's why we have warnings.

BEGALA: Mr. Doyle, why not having a warning like this on the back -- like if I go to the grocery store and by Ho Ho, Wing Dings, butter, anything with fat in it, the government has a disclosure right there. Now I know that butter is fattening, but I know precisely it's 11 fat grams per tablespoon because of this warning. Why not put this on the back of your French fries?

JOHN DOYLE, CO-FOUNDER, CTR. FOR CONSUMER FREEDOM: Well, Paul, first, I feel for you, because I know how hard it must be to defend this. Think of the case: this guy Cesar Barber. In 1996, his doctor said, "Change your diet." He just had a heart attack. "Start exercising." This was Cesar's admission on national television.

BANZHAL: That suit is gone. The new suit is being brought by two young children who didn't know...

DOYLE: This witness sued -- John. Excuse me, excuse me. John. We'll give you a minute.

BANZHAL: You're defending a suit that no longer applies.

DOYLE: But this is a suit that you've...

BEGALA: What I'm curious about is why not empower consumers with information?

DOYLE: That information is in every fast food -- major fast food restaurant -- that's what the Cesar Barber suit was about. Now, this bait and switch tactic, the last minute change of suit...

BEGALA: Not on the bathroom wall.

DOYLE: It's in the front section. It's in the front section. BANZHAL: Tell me which is the most fattening food. I downloaded that today from the web site.

CARLSON: But you're not addressing-- You know what the most fattening food is? The most fattening food is triple thick shakes, I think. But my eyes...

BANZHAL: No, you can't read it. You can't read it. Bring a camera in.

DOYLE: No, that is not what they're giving you. That's what Mr. ...

BANZHAL: It's .4 size type. I downloaded it today.

DOYLE: John, John. Go to the wall, take a couple of steps over.

BANZHAL: You go to the wall.

DOYLE: I've been there. All of the information -- Look, it doesn't take a rocket scientist...

BEGALA: Being on the wall is not appropriate, though. Why not on the package?

DOYLE: Paul, if you look -- Because after you bought the package, you already bought the product.

BANZHAL: So put it up on the board so people can read it.

DOYLE: Let me say -- Let me say something. We've been doing this for a couple of months now. You've got to give me a chance here. You've got to look down. If you...

BANZHAL: You're outclassed. That's your problem.

DOYLE: John, please. If your gut is hanging over your belt, if you have trouble, if you're putting on weight, obviously what you need to do is exercise a little more and cut back on high-calorie foods. If everybody understands a triple thick shake or French fries has more calories than a salad. It's obvious on the face of it. What Mr. Banzhal is trying to do is -- is make this thing over-simplified by turning it into a late-night television commercial for Dewey, Cheatham and Howe.

People understand that food is neutral. There are -- there are calorie dense foods, there are calorie light foods. If I spent my -- my whole life eating just carrots and bottled water, I'd be dead in three months. It's not the carrot's fault. It's my choice; I made the wrong choice. It's about the food I eat.

BANZHAL: But consumers...

BEGALA: Hold it. Let's talk about the carrot...

CARLSON: I've got it right here. I've got something to ask you. BANZHAL: Tell people about it. You can ask your question. A lawsuit has just been filed alleging that two very young children were lured into McDonald's by the Happy Meals, by the playgrounds.

DOYLE: Did they drive themselves in?

BANZHAL: Just -- just ...

DOYLE: Did they drive themselves in? Of course they did not. Did they pay with their own money?

BANZHAL: No.

DOYLE: Their parents took them. They're trying to...

BANZHAL: That's legally irrelevant. You don't...

DOYLE: How can it be irrelevant? You're trying to...

BANZHAL: Let me explain it to you. Contributory negligence of parents is not a defense to actions by children. If these kids are lured in, if they are made fat...

DOYLE: How did the children -- how did the children lure the parents? Was there some leverage, was there physical violence? Or threats? How is that

BANZHAL: You don't understand the concept.

DOYLE: Let me say, you don't have kids.

BANZHAL: What I'm asking you to tell...

CARLSON: There's not even -- There's a consensus that what you're saying is ludicrous. But there's not even a consensus that...

BANZHAL: By who? By who?

CARLSON: By, as I said, the poll I took of everyone. And I'll give you the stats.

BANZHAL: Let me tell you something.

CARLSON: Yes.

BANZHAL: If it is frivolous, then why are they hiring people like him to run full-page ads?

CARLSON: Because it's the principle.

BANZHAL: Why is McDonald's paying us $12.5 million to settle a suit that's frivolous.

DOYLE: That has nothing to do with this...

BANZHAL: Why is the National Restaurant Association going to Congress and saying, protect us please?

CARLSON: OK. You know, Mr. Banzhal. Is this your strategy to talk louder? It won't work in court, pal. Here's my question...

BANZHAL: I've been in court and I've won.

CARLSON: Yeah, that's great.

BANZHAL: How many lawsuits have you won, Tucker? How many lawsuits have you won? You wrote about me, you know how many I've won.

CARLSON: If you're not responsible for where you eat lunch, what are you responsible for? That's the principle. Someone's -- individuals are responsible for...

BANZHAL: In most product liability cases there is joint responsibility. We're not saying that they're not partially responsible. The question is...

CARLSON: You're saying you want money for it.

BANZHAL: The question is do the fast food restaurants bear any responsibility for the $170 billion worth of cost of obesity? That's the bottom line issue.

BEGALA: The question is why do they hide the fact that this is fatty? KFC used to be Kentucky Fried Chicken. Right. The fried is gone now; it's KFC. It's this whole Orwellian desire to hide from people the facts. Why not just disclose it?

BANZHAL: Why do they want to be so -- not to be included in the laws that require disclosure?

DOYLE: John, please, please. John, listen to me, all right?

BANZHAL: I'm trying to give you...

BEGALA: Why not disclose the facts?

DOYLE: The facts are disclosed. They're in the restaurants, they're on the Internet.

BANZHAL: Why don't you read it on the Internet here and tell me which is the most fatty foods.

DOYLE: John, please. You're getting...

BANZHAL: I can't read it, buddy. I downloaded this today. you can't read it. It's impossible.

BEGALA: What possible reason could Kentucky Fried Chicken have for changing their name except to hide the fact that it's fat food not fast food.

DOYLE: No, I think most people realize that it's still Kentucky Fried Chicken. The food is...

BEGALA: Why did they change the name, though?

DOYLE: I don't work for Kentucky Fried Chicken...

BEGALA: You know why! You eat fried, you get fat!

DOYLE: It would be so hard to be...

BANZHAL: They lobbied so hard to be excused from the law requiring disclosure. They lobbied like mad in 1990.

CARLSON: Now, Mr. Banzhal, I'm sorry, but you do win the shout fest but not the logical argument. John Doyle, thank you for joining us, too. Both of you.

We have a news flash, ladies and gentlemen, fast food can be fattening. Our viewers have taken time from their burgers, fries and shakes to e-mail us their thoughts on fast food. Rapid action, our "Fire Back" segment is next. We'll be right back.

(COMMERCIAL BREAK)

CARLSON: Welcome back to "CROSSFIRE." We argue so you don't have to. It's the end of our show. Our "Fire Back" segment. Let's go to the e-mail.

First up, Anne Owens of Alberta, Canada, writes: "Why do people dislike the U.S.?" You, too, I imagine. "Your program regarding the British monarchy is a prime example of why we don't like you. Mind your own business and allow other countries to choose their preferred system of government."

You know, Paul, it wouldn't be a day without a scolding from the Canadians.

BEGALA: But you know, somehow, the Canadians, they just hate you. I love Canada.

CARLSON: I love the Canadians. They're funny little people, I love them.

BEGALA: Now it's coming again. Write to him. Ladies and gentlemen of the Great White North, it's Tucker Carlson you want to write.

Pete Wolczik writes me from Boston, Mass.: "One of the many paradoxes of this administration is that Colin Powell should be the president and ignoring George W., rather than the other way around."

Pete speaks true wisdom there.

CARLSON: I'm convinced that every bumper sticker writer in America is a liberal Democrat, because that -- that literally is the length of the thought for liberals. Joseph McCarty, not McCarthy, from Independence, Missouri, writes: "So now the greedy, venal plaintiffs' attorneys have gone after the fast-food industry. I suppose now we can expect $7 Big Macs to finance their next vacation to Belize. I'm already paying $5 a pack for cigarettes because of these wretched leeches."

They are wretched leeches.

BEGALA: Wait a minute. Joseph McCarty, what happened to personal responsibility? You're paying $5 a pack because you're a smoker. Don't blame the lawyers.

CARLSON: What do you mean? You should be able to smoke without paying off John Banzhal.

BEGALA: They're not paying for them?

CARLSON: They're paying what John Banzhal asks.

BEGALA: Just pay for your cigarettes, Joseph, and quit hacking off to me.

Loose Wells. Loose Wells. Loose Wells. Sounds like an adjective, not a name, of Danville, Virginia, writes: "Paul, I am a fat smoker. Can you help me find a way to blame Bush or Cheney? If not, get me in on one of those suits."

All right, Loose! Loose, my man, my woman, whatever you are, my loose one.

CARLSON: Mind your mouth.

BEGALA: You're fat, a smoker and you like Bush and Cheney. I think the fat, smoking part is the least of your problems.

CARLSON: And you're a loose woman.

Yes, sir.

STEFANO FORMICA (ph): My name is Stefano Formica (ph) from Glendale, California. I want to know, why limit the lawsuit to fast food corporations? Are the fries at Friday's good or better for you?

CARLSON: That's a great question. Because the purpose of the suit, of course, is to get publicity and enrichment for the attorneys filing, not to actually help anybody. If you followed this conclusion, you'd sue makers of any food that made you fat. It's ridiculous.

BEGALA: Well, what they ought -- actually, this is where the government should step in. I'd rather do that than a lawsuit, which is make people disclose how much fat is in there. We do it at the grocery store; we should do it at the restaurant. But I own -- I own a little bit of stock in McDonald's. This is what Ralph Nader would have called it.

CARLSON: And you have blood on your hands, pal! Blood on your hands!

BEGALA: Without the reference, you just tell us exactly how much fat...

CARLSON: That's like investing in a napalm company. Yes.

SENNIS SIRSTE (ph): My name is Sennis Sirste (ph). I'm from Woostertown (ph), Kentucky, and my comment is for Mr. Begala.

BEGALA: Yes.

SIRSTE (ph): Speaking as the daughter of a laborer who voted for George W. Bush, I can assure you that $300 goes much further in the real world than hollow rhetoric such as yours.

CARLSON: That. You know, it's nice to hear someone who isn't actually -- who isn't making, you know, a political consultant salary point that out, that $300 truly is not to be sniffed at. Thanks.

BEGALA: Unless you are part of the one-fourth of all Americans who got zippo, zilch, nil, nada from Bush because they -- they didn't qualify for a rich person's tax cut.

CARLSON: What is that, exactly?

BEGALA: We should help working people, not wealthy people.

CARLSON: Giving working people a rebate is illegitimate because not everyone got one?

BEGALA: Yes.

CARLSON: I missed the point.

BEGALA: Yes.

CARLSON: You're dismissing this...

BEGALA: You should cut taxes for all taxpayers. sir: 54 cents a week is what average people got; $54,000 people is what rich people got.

From the left, I'm Paul Begala. Good night from "CROSSFIRE."

CARLSON: And from the right, I'm Tucker Carlson. Join us again tomorrow night for yet another edition of "CROSSFIRE." Happy Labor Day. "CONNIE CHUNG TONIGHT" begins immediately after CNN News Alert. See you.

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



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