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Bush Names Stephen Friedman Chief Economic Adviser; Trent Lott Still Under Fire For Comments At Thurmond Celebration

Aired December 12, 2002 - 16:00   ET


GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Recent comments by Senator Lott do not reflect the spirit of our country.
ANNOUNCER: A lot more to explain? The president toughens his line about the Senate's top Republican.

The buck stops here. This hour, Mr. Bush names a new economic adviser, criticized by some conservatives.

It's not your father's peace movement. Who is behind the protests against war with Iraq?

A "Barney Cam" Christmas. This White House holiday tour turned out to be a real dog.

LAURA BUSH, FIRST LADY: When we put the mini-cam on him, he became immobile. He wouldn't move. So instead, a person had to run around behind Barney holding the little bitty camera.

ANNOUNCER: Now, live from Washington, it's INSIDE POLITICS with Judy Woodruff.

JUDY WOODRUFF, CNN HOST: Thank you for joining us.

We begin with President Bush, plowing ahead into two political controversies. This hour, Mr. Bush is expected to name Wall Street veteran Stephen Friedman as his top White House economic adviser.

Now, some conservatives have questioned Friedman's commitment to tax cuts and tried to derail his appointment.

Earlier today, Mr. Bush denounced recent remarks by incoming Senate Majority Leader Trent Lott. In his first public comment on this controversy, the president said any suggestion that segregation was acceptable is offensive and wrong.

Our senior White House correspondent John King is standing by for the president to announce the latest edition to his economic team.

John, the president is not concerned at all about the opposition of some conservatives?

JOHN KING, CNN SR. WHITE HOUSE CORRESPONDENT: No, Judy, they don't like the public criticism here at the White House. But politically, they think in the long run it could actually help the president. They believe those conservative complaints about Steve Friedman will dissipate once they see, as they insist here at the White House, that Steve Friedman will work hand-in-hand with the president, the vice president and others in aggressively pushing for more tax cuts. The pro-growth conservatives, as they call themselves, don't think Steve Friedman has the necessary zeal, if you will, for cutting taxes.

White House officials say that is not the case, so that months from now the conservatives will have nothing to complain about and that, as we discuss this today, perhaps many Democrats will see this is a president standing up to one part of his party, the conservative, economic right wing, if you will, of the Republican party.

So, at the White House, they actually think the president can only gain from this dispute.

WOODRUFF: ...that Friedman has worked closely with Bob Rubin, who was Bill Clinton's treasury secretary. Why did the White House pick Friedman?

KING: No. 1, the main reason is, that both Larry Lindsey, the man Steve Friedman will replace as the top economic aide on the White House staff, and the treasury secretary, Paul O'Neill, have been widely criticized on Wall Street. Many on Wall Street think they have not paid proper homage, if you will, to Wall Street as a financial institution. Bob Rubin, of course, did that during the Clinton administration days, as did others on the Clinton team. So they want an envoy to Wall Street. They believe Steve Friedman is that man, the co-chairman, with Bob Rubin, of Goldman Sachs, very well known on Wall Street.

They believe with this new installment to the economic team, all the criticism of Wall Street, that it is not consulted, that it is not paid attention to, that the president doesn't respect the markets, they believe that will dissipate, and they also believe that, yes, he will share the president's zeal for cutting taxes, but yes, he might also bring some new ideas to the team. They say here at the White House, that's more than welcome.

WOODRUFF: Well, we'll see what some others have to say about it. All right, John. We are going to come back to you in just a minute because we do want to turn to the Trent Lott firestorm.

As we know, it's been building for days, and the president's decision to speak out suggests just how threatening it has become. Let's quickly bring back John -- to this story.

Sorry, John, a little bobble there because we thought we were going to be going to Steve Friedman's announcement.

Trent Lott -- why did the president speak out now? Because we've had his press secretary for the last few days saying, Yes, he's apologized. The president stands by Trent Lott. KING: The White House held its fire, Judy, to give Trent Lott a chance to put this controversy behind him. Senator Lott called into a conservative radio show yesterday, he called in to the Larry King program on CNN last night.

One senior White House official called that cowardly, said Senator Lott, for the good of the Republican Party and for the good of himself needed to come out before the cameras, perhaps even surround himself with civil rights leaders, take questions and explain his views.

This president is committed to trying to build Republican support among African-Americans. So when Senator Lott did not come out and apologize more forcefully and more publicly, the president decided this morning, we are told, that when he got to Philadelphia later in the day, he would do so. The president had a very tough rebuke of Senator Lott. I think we have a little bit of it we can listen to.


G. BUSH: Recent comments by Senator Lott do not reflect the spirit of our country. He has apologized, and rightly so.

Every day our nation was segregated was a day that America was unfaithful to our founding ideals -- and the founding ideals of our nation and, in fact, the founding ideals of the political party I represent was and remains today the equal dignity and equal rights of every American.


KING: Judy, Mr. Bush told aides he believed any president needed to deliver a public rebuke of Trent Lott's remarks, an apparent endorsement, although Senator Lott has apologized since, of segregation. Mr. Bush and top political advisers, though, also believe that Senator Lott could cause lasting damage to the Republican Party.

This is a president who, in his re-election campaign, as Texas governor in 1998, received 27 percent of the African-American vote.

He still to this day complains that he got fewer than one in ten African-American votes in the 2000 presidential election. That is a situation he has hoped to improve. They believe here at the White House Senator Lott was hurting the cause, that he had not apologized forcefully enough, so that the president had no choice but to step out and say what he said.

WOODRUFF: And now that the president has said something, clearly opens the way for other conservatives to criticize Senator Lott even more, and we are going to get back to that in just a minute, but I'm told right now, John, that the president is just about to announce Steven Friedman who will be his top economic adviser. We were discussing that, and we are just a few seconds away.

Mr. Friedman, as you said, comes from Wall Street, from Goldman Sachs, he was a close colleague and associate of Bob Rubin, who was the Treasury secretary under Bill Clinton. Let's listen now.



WOODRUFF: All right. John King, two important stories today out of the White House.

We have much more ahead on those two stories.

Up next, when the dust settles, will Trent Lott still be the Senate Republican leader?

Plus, the Bush economic team. Will conservatives stop their griping about the newest member?

And President Bush didn't make it, but Bill Clinton did. It's a list you may want to check twice, later on INSIDE POLITICS.


WOODRUFF: Al Gore may have seven millions of reason to smile. Coming up we tell you about his possible financial windfall. INSIDE POLITICS is back in a minute.


WOODRUFF: Well, as we've been reporting, President Bush had some sharp words for Senator Trent Lott today. What the president said now appears to have opened the floodgates for other Republicans to weigh in.

Congressional correspondent Jonathan Karl is on Capitol Hill.

Jon, what exactly has the fact that the president has now spoken publicly, what does that mean for this whole, for Trent Lott's ability to survive?

JONATHAN KARL, CONGRESSIONAL CNN CORRESPONDENT: Well, a lot of Republicans up here have been waiting for, to follow the president's lead on this. This certainly does give an opening for many who have been silent up until now to come out.

But before I get to that, Judy, I want to tell you, immediately following the president's statement, Trent Lott's office in a statement after the president criticized him, quote "Senator Lott agrees with President Bush, that has his words were wrong. He (UNINTELLIGIBLE) segregation and it is immoral".

Now that said, shortly after the president came out, Senator John McCain told us in an interview, he believes Trent Lott needs to come out and answer questions. Those radio, television interviews, via telephone, were not enough -- not enough. That he needs to do more to answer his critics.

(BEGIN VIDEO CLIP) SEN. JOHN MCCAIN (R), ARIZONA: I don't believe so. I think he has to have a full-blown press conference with a opening description of his absolute outright hostility to discrimination in any form. His support for an equal opportunity America, and an America that will continue to grow and improve in every day, in every way, particularly in regards to our relations with all Americans.


KARL: As can you imagine, Judy, Senator Lott's record is getting increased scrutiny now in the wake of this controversy. Democrats are combing through all his past votes, all his statements and trying to bring attention to things that Trent Lott has long since perhaps forgotten about.

Some issues talked about some of those previous votes and statements include a 1981 vote against the renewal of the Voting Rights Act, this when Lott was in the House that vote, 389 to 24. He was one of only 24 in the house to vote against that. Now, that said, there is an explanation for. Many people thought that Voting Rights Act was unfair to the south, because it required southern states to get pre-approval from the Justice Department before making changes to their civil rights laws.

He also in 1981 file add brief, amicus brief with the Supreme Court in support of Bob Jones University tax exempt status. Bob Jones University at the time had a ban on interracial dating and because of that ban, they were having their status revoked. The Supreme Court voted 8-1 against Lott's position, against Bob Jones University's position and striped that school of its tax exempt status.

Also in 1983, he voted against the establishment of the Martin Luther King Jr. holiday. That vote was 338 in favor, only 90 against. Again, senator Trent Lott, one of just 90 voting against the Martin Luther King holiday back in 1983. Now Senator Lott had a consistent position, said he was against federal holidays. Did not think we should have another federal holiday, it would be too costly.

In an interview with a magazine "Southern Partisan," he also said there were others more deserving of a holiday than Martin Luther King. Also, in that same magazine in an interview in 1984, he said, "The spirit of Jefferson Davis lives in the 1984 Republican platform." Jefferson Davis the president of the southern confederacy. Now this was a statement said in 1984, one long since forgotten but getting looked at anew.

Democrats are sending this stuff around, drawing attention to Senator Lott's statement. This is another reason why people like John McCain are coming out saying he must do more to defend himself. Now that said just we heard a little while ago from Speaker Dennis Hastert, he came out in defense of Senator Lott. Here's what he had to say.


REP. DENNIS HASTERT (R-IL), SPEAKER OF THE HOUSE: I was out of the country, basically, when all this stuff broke. I know Trent Lott. And I've worked with him for years, even he was the whip when I came to the House. That's not where Trent Lott's heart is and, certainly not his legislative record. So I think a lot of this stuff must have been taken out of context. I haven't listened to it or anything since I just got back.

KARL (on-camera): The president criticized him, mentioned his name up in Philadelphia saying comments like to do not reflect the Republican party?

HASTERT: And I don't think they do but I don't think they also reflect what Trent Lott has in his heart either. I they was probably taken out of a situation that.

KARL: Will he survive it?

HASTERT: I'm sure he will.


KARL: Senator Lott's office said that in point in fact, a strong record on civil rights and civil rights related issues. They site several votes.

Let me give you a couple of those, Judy, one he has long ban supporter of black colleges in the state of Mississippi. Including Jackson State University where there's actually a Trent Lott Center. Also that he was the co-sponsor of a bill that created the National Museum of African-American History at the Smithsonian and point to several other issues including strong port for the free trade bill with Africa.

So you can expect more back and forth on this. Senator Lott forced to defend his record against votes he made many, many years ago but getting newfound attention because of this controversy surrounding his statements about Strom Thurmond -- Judy.

WOODRUFF: Bottom line, this one is not over yet.

KARL: No, it really is not over yet. One quick thing on that, the people we have not heard from yet, some of the moderate Republicans who you'd expect to come out and show independence from their party on this. Lincoln Chafee of Rhode Island has refused repeated attempts to statement from him. So has Susan Collins, Olympia Snow, Jim Talent and by the way Elizabeth Dole a new senator from North Carolina. None have said anything yet about this controversy.

WOODRUFF: All right, Jon, thank you very much.

Well, we have more now on the bottom line for embattled Senator Trent Lott. Can he hold on to his leadership post? Our senior political analyst Bill Schneider is with us.

Bill is the -- is -- Bill, is Trent Lott going to be able to survive in this environment as a leader in the Senate? WILLIAM SCHNEIDER, CNN SR. POLITICAL ANALYST: Well, look, the president has given cover to Lott's critics. I mean, he was very harsh in his statement, and he said this in a very strong tone. He said, "Recent comments by Senator Lott do not reflect the spirit of our country."

Now, that is a very sharp rebuke. And essential think says, if the president feels compelled to distance himself from Senator Lott's comments in such a forceful way, it suggests that he has lost the confidence of the president. And as the leader of the majority in the Senate, it raises the question whether the president feels he can work with Lott.

I think Lott could survive, but only if he takes some risks.

Jack Kemp had this suggestion: He should go before a civil rights group and deliver a serious speech about racial reconciliation and take questions, one that forcefully repudiates the Jim Crow past. It would be a big risk for him to do that. He could get booed. But he might have to take that risk.

WOODRUFF: Well, and as we just heard John McCain is saying he should have a news conference. So, in any event, there are a number of people calling on him to go before a crowd of either reporters or colleagues and answer questions.


WOODRUFF: All right. Bill Schneider.

Well, now Bob Novak joins us with more on the Trent Lott issue.

Bob, when you -- you know, you've been reporting on this all week. You've watched the situation change. What is it mean now that the president himself has weighed in and been clearly very tough, almost an indictment of Senator Lott in his comments?

ROBERT NOVAK, CNN POLITICAL ANALYST: Well, that was a serious blow. You know, I think if you're a Republican, much more than a Democrat, and you get in trouble, you can pretty well count on your colleagues to knife you in the back, and Jack Kemp did that. His great friend and ally, said it was inexcusable what Trent Lott said. Inexcusable means it can't be excused.

The president did not give one word of accommodation of this person he has worked with. The thing that's very interesting to me is that the president didn't have anything to say for a week, until the story began to build, and the momentum by the Democratic attack included.

The question I think Republicans have to ask is whether they want the Congressional black caucus to be the judge of who the majority leader of the Senate -- of a Republican-controlled Senate is.

But I would say that the situation is not very good for Senator Lott, when the president does not stand up for him in any way. WOODRUFF: But you're right about that. The press secretary to the president just a few days ago said Senator Lott's apologized. The president is prepared to leave it at that.

Let's turn now though, Bob, quickly to Stephen Friedman. Steve Friedman, the president just appointed him to be his chief economic adviser. You were saying a few days ago that conservatives who want to see growth, who want to see tax cuts are very worried about Steve Friedman.

So where does that go from here?

NOVAK: They're appalled by that selection. They can't figure out why the vice chairman of the Concord Coalition, one of the great critics of the Bush economic policy is named, a switch-hitter who gives to Democrats, somebody who is a deficit hawk rather than a tax cutter.

And I see, Judy, the same syndrome that bothered the President Bush's father,that he's playing to the opposition on the Lott affair, he's playing to the opposition on getting Steve Friedman in. Somebody who drank from the same drinking fountain as Robert Rubin at Goldman- Sachs.

Of course, Robert Rubin is against everything that the president stands for. He was a liberal ideologue. So I don't think you want a Rubin clone in that job, but when I hear the John King reporting White House aides saying that they're playing very hard to the people who don't like him a lot, and it's going help the president to be independent, it's going to help him with his critics of his economic policy to get somebody in there who doesn't like tax cuts. I have -- excuse me -- deja vu of a decade ago when his father went down the same path.

WOODRUFF: The only thing I disagree with you on is, my guess is that Bob Rubin and Steve Friedman has their own drinking fountains in their own offices.

NOVAK: I think you're right, Judy.

WOODRUFF: All right. Bob Novak, thanks very much.

Coming up on INSIDE POLITICS, it's a matter face for President Bush, but is the president blurring the line between church and state? We'll get the view from the left and the right.

Plus, the president did just name Steve Friedman to his economic team. But, as you've been hearing, many conservatives don't like him. Next, we'll debate that economic move. Cut the taxes or cut the deficit?



WOODRUFF: Just in time for the holidays. A dog's eye view of the White House. Coming up, the canine cam from 1600 Pennsylvania Avenue.

But first, this "News Alert."


WOODRUFF: Well, today's comments about Trent Lott led the headlines, but President Bush was actually in Philadelphia to advance his faith-based initiatives, which have so far stalled in the Congress.

After remarks from local religious leaders, Mr. Bush signed executive orders designed to help churches and religious groups obtain government money for their social programs. The president said, until now, religious groups have been treated unfairly by the federal government.


G. BUSH: If a charity is helping the needy, it should not matter if there is a rabbi on the board or a cross or a crescent on the wall or a religious commitment in the charter. The days of discriminating against religious groups just because they are religious are coming to an end.


WOODRUFF: With us now: former Gore campaign manager Donna Brazile and Bay Buchanan, president of American Cause.

Bay, the president is doing what he can't get the Congress to do. He signed an executive order. He wants the federal government to begin to help these faith-based group.

BAY BUCHANAN, PRESIDENT, AMERICAN CAUSE: And he's also showing enormous leadership. He's extremely bold. I think this is a terrific message to the American people. He has the power of the White House and he's using it for the right purpose, in an effort to try to make certain the needy people in this country get what they need as efficiently and as effectively as possible.

The Congress wouldn't do it. He has the power to do it. And he did it. And I commend him for it.

WOODRUFF: Well, what possibly could be wrong with it, Donna?

DONNA BRAZILE, CHAIRWOMAN, VOTING RIGHTS INSTITUTE: Well, I was trying to figure out the exact scripture, but I believe it's from the book of Matthew. Give unto Caesar what is Caesar's and to God what is God's.

Look, this about allowing institutions to discriminate freely and openly with taxpayer dollars. That's why this initiative should have remained on Capitol Hill, where it could have been amended and included language to ensure that no one is discriminated. There's nothing wrong with faith-based institutions. They do a wonderful job in serving the needs of the poor and the elderly and the sick and the infirm.

But without those anti-discrimination clauses in that legislation in that executive order, people are afraid that the sign will go up: Catholics should not apply. Jews should not apply. Muslims should not apply, Protestants, etcetera.

BUCHANAN: That's not true. In fact, what they have been doing is discriminating against the faith-based.

Look, there's Jewish groups out there. There's Catholic groups out there. There's many, many groups. And we do know, without question, is, faith-based groups are far more effective than those which don't have any type of religious basis. They are far more effective in helping the needy.

So, what the president is doing, these are groups that work. Why should we discriminate? Why should we not put our tax money behind groups that are actually doing the work now and will be effective?

BRAZILE: They should get the right status so that they can receive federal aid, federal assistance, like everyone else, so that they will not discriminate on the basis of race, gender or any other issue.

BUCHANAN: It is clear in the initiative that the president signed, that these funds cannot be used to instruct or for any religious services. They are to help the needy. That's what they do effectively, efficiently. And why not use our taxpayer money in that way?

WOODRUFF: We are not going to resolve it here.

We're going to move quickly on to the president announcing today, after all, that he is going to name Stephen Friedman, formerly of Wall Street, to be his top economic adviser.

Now, some conservatives, Donna, are very upset about this, saying, Steve Friedman doesn't sufficiently believe in big tax cuts. You just heard him talk about: We believe in growth and creating a lot of growth. But is this the right move for the president?

BRAZILE: Well, first of all, Mr. Friedman is a great leader, a proven leader. And I think he would have fit better in the Clinton- Gore administration than the Bush-Cheney administration, because of his views on tax cuts and deficit reductions.

Look, if he's going to be a slick oil salesman for another huge run of tax cuts for the wealthy, I think Mr. Friedman will not be practicing what he's always preached in terms of deficit reduction and tax cuts that are targeted to the middle class, not the well-off.

BUCHANAN: Three-hundred billion in tax cuts coming up, Donna. You'll see him supporting those, because he has said he will support the president's programs.

But, Judy, the key here, I think, is, there's no question there's reason for conservatives to be alarmed, because we now have somebody at the table who has not supported tax cuts, the president's tax cuts, per se. But, at the same time, my having experience in the Department of Treasury myself, the Department of Treasury is where tax policy is developed.

And the cheerleader, this chief cheerleader, of course, is the president. And No. 2 is the secretary of the treasury, both of whom are solidly tax-cutters. And so I feel comfortable. We now have someone else at the table who may not take that position.

WOODRUFF: But Steve Friedman is going to whispering in the president's -- he's going to talking in the president's ear every day.

BUCHANAN: He certainly is.

But, when you take a president and you look at his agenda, there's many, many items on it, but there's only a few that any president is passionate about. This president is passionate about tax cuts. He's always been for them. And there's no reason for me to believe he's going to back off, especially when he knows his dad backed off and it caused his demise.

BRAZILE: We have a huge deficit. The tax cuts that have already been enacted, they have not helped the economy move again. We have a problem right now. And that's one of the reasons why the president said goodbye to his previous economic team. And I don't believe they have a clue yet in terms of how to move the


BUCHANAN: Oh, I think they do indeed.

WOODRUFF: We're going to leave it there. But we have a clue that we want you, both of you, back.

BUCHANAN: Count on it. We'll be here.

BRAZILE: Thank you.

WOODRUFF: Donna Brazile, Bay Buchanan.

BRAZILE: No tax cuts for us.


BUCHANAN: Donna, but it will help you. You're in those top ranks now.

WOODRUFF: Thank you both.

BUCHANAN: You're welcome.

WOODRUFF: Updates on the bioterror threat and possible war with Iraq coming up next.

Plus: the new anti-war movement. Who is taking to the streets to give peace a chance?


WOODRUFF: U.S. officials are downplaying a report that an Iraqi group with ties to al Qaeda may have obtained a deadly nerve agent for possible terror attacks. They say the information is uncorroborated and that there's no evidence of any involvement by the Iraqi government.

But Press Secretary Ari Fleischer notes, the White House has -- quote -- "long-standing concerns about Iraq providing weaponry to al Qaeda." He says, "We know al Qaeda is seeking it."

Tomorrow, President Bush plans to announce a new precaution against bioterror. Smallpox vaccine will be mandatory for all military personnel and recommended for health workers who would be front-line defenders against a bioterror attack. The shots would be made available to the general public on a voluntary basis later on.

Meantime, in Iraq, another two-dozen U.N. weapons inspectors are on the ground, bringing the total to almost 100. They searched no fewer than five sites today, while other experts continued to analyze Baghdad's declaration that it does not have weapons of mass destruction.

At first glance, the protesters who oppose a potential conflict with Iraq may look and sound a lot like the protesters from a generation ago. But the strategies being used by today's activists are a lot different than those used back in the '60s.

Here now is CNN's Kathleen Koch.


KATHLEEN KOCH, CNN CORRESPONDENT (voice-over): Singing and street theater Tuesday, as a few hundred demonstrated in New York City.

PROTESTERS: One, two, three, four, we don't want your war no more.

KOCH: In Washington, some 400 chanted and marched on the White House. In Los Angeles, celebrities signed letters of protest, small- scale. But, in October, some 200,000 protested nationwide. The size of this anti-war movement is unclear, but its faces and methods are unfamiliar. Until recently, 29-year-old Adam Eidinger was protesting globalization.

ADAM EIDINGER, ANTI-WAR PROTESTER: We suddenly realized our issues weren't going to resonate about economic issues because everyone is concerned about security.

KOCH: Now he's organizing anti-war demonstrations.

EIDINGER: Chants and speakers for a half-hour. And I need least 45 (UNINTELLIGIBLE) obedience. PROTESTERS: Hell no, we won't go!

KOCH: The words may be the same, but members of a new anti-war coalition of civic and faith organizations insist this is not your father's or mother's peace movement.

BOB EDGAR, NATIONAL COUNCIL OF CHURCHES: I can tell you, as someone who was intimately involved in the 1960s and '70s in the anti- war movement, we're starting earlier, faster, with more support this time.

BOB MUSIL, ANTI-WAR PHYSICIAN: The old frame of, is this the '60s movement reborn, does not work. What you have seen is dot-com, e-mail, organizing of a sophisticated political variety for the 21st century.

KOCH: Critics argue the movement is less about peace, more about self-interest.

JACK SPENCER, HERITAGE FOUNDATION: These protests movements, I would argue that a lot of them are essentially professional protesters, will grasp on to the issue to further their own political agenda. And I think that's largely what's going on here.

KOCH: And though the new anti-war movement is more diverse and mainstream, polls shows most Americans support war with Iraq. A new CNN/"USA Today"/Gallup poll finds 65 percent back the use of U.S. ground troops to oust Saddam Hussein; 39 percent oppose it.

While few believe protesters can stop the Bush administration from pursuing its current Iraq policy, some say they can have an effect.

ANN FIORINI, BROOKINGS INSTITUTION: If the war turns out to be a long-term one, the anti-war protest movement could certainly have an impact. The other way it will have an impact is that, even if the war is short, the aftermath is going to be long and messy.

KOCH: Meaning words like quagmire could resurface along with the peace signs.

Kathleen Koch, CNN, Washington.


WOODRUFF: And this item just in to CNN: The Congressional Black Caucus has just issued a statement further condemning the remarks of last week by Senator Trent Lott, the incoming majority leader in the Senate.

Among other things, the members of the caucus, 39 House members of the caucus, say that, after examining Lott's record, they find not an isolated incident, but a long-standing pattern of behavior that they say -- quote -- "can no longer be ignored or tolerated." They go on to stay: "It is astounding that, even though the president broke his silence today on the matter, that the president has not called for Senator Lott to step aside as incoming majority leader."

They say -- again, the Congressional Black Caucus saying an apology will not suffice. And, finally, they call on the president, on every member of the Senate and the leadership of the Republican Party to -- quote -- "support a formal censure of Senator Lott's racist remarks." They say anything less than that will forever lead millions of Americans to believe that these remarks are condoned by the president, the Congress and the Republican Party, again, this statement just issued by the members of the Congressional Black Caucus.

CNN will continue, of course, to follow that story.

Question: Will he or won't he? New information about a potential Gore presidential run. Plus: why Al Gore is already leading in the so-called invisible primary.


WOODRUFF: Our "Campaign News Daily" begins with answers to the question: Why do people donate to political campaigns? The Ohio Republican Party drew up seven reasons back in 1998 to use in its candidate training schools.

Well, the list recently became public. And reason No. 1, the party decided, is habit. People are just used to giving to the same causes year after year. Actually agreeing with candidates is apparently less common. Issues and ideology came in at No. 5. The last reason on the list was reserved for donors who give to both parties so they will have access to the winner, no matter who wins the election.

President Bush's repeated trips to Pennsylvania are, of course, no accident. The state's 21 electoral votes will be crucial in 2004; 12 of the president's 17 trips to the Keystone State have been either to Pittsburgh or Philadelphia. Mr. Bush lost Pennsylvania to Al Gore in 2000 mainly because he lost most of the counties around those two cities.

Al Gore will have a large, but mostly overlooked supply of cash if he decides to make another White House run. Gore, we're told, still has $7 million left over from his 2000 campaign. According to an report, the money is in what is called a legal and accounting compliance fund. Theoretically, the cash could be transferred to a campaign account if Gore were to decide to run again.

Our senior political analyst, Bill Schneider, is with me now with more on Al Gore and his political future.

Bill, what have you been thinking about here?

SCHNEIDER: Well, Judy, if Al Gore runs in 2004, does he become the odds-on favorite to win the Democratic nomination? Some current research suggests the answer: Yes.

(BEGIN VIDEOTAPE) (voice-over): Yes, sure, Gore's the front-runner in polls of Democrats right now. But it's easy to dismiss those polls. They just reflect name recognition. And, anyway, it's a year before the race even starts.

Not so fast, says one expert on the nominating process. William Mayer, a political scientist at Northeastern University, has studied every contestant nomination in both parties since 1980. And guess what he finds?

WILLIAM MAYER, POLITICAL SCIENTIST, NORTHEASTERN UNIVERSITY: In seven of the last 10 contested nomination races, the ultimate nominee, the eventual nominee, was the person who was leading the polls within a month after the preceding midterm election, so just about at this point in the nomination cycle.

SCHNEIDER: Welcome to the invisible primary, the period from the midterm election to the Iowa caucuses, when candidates struggle for money and attention before a single vote is cast.

Ronald Reagan, Walter Mondale, Bob Dole, Al Gore, George Bush the elder, and George Bush the younger all led the polls after the midterms and ended up winning their party's nomination. Nine out of 10 times, Mayer finds, whoever wins the invisible primary becomes the nominee.

What about dark horse candidates who emerge during the primaries, like Gary Hart in 1984 and Pat Buchanan in 1996 and John McCain in 2000? Didn't they gain momentum or what George Bush called, after he beat Ronald Reagan in Iowa in 1980, the big mo'? Each of them did get momentum, but none of them got the nomination.

MAYER: I characterize momentum as a bit like a roller-coaster ride. It provides a lot of excitement, a lot of interesting moments. But, in the end, it pretty much takes you back to where you started off. And, so after all the forces of momentum have played out, the candidate who started out ahead almost always finishes ahead.


SCHNEIDER: And if Gore decides not to run, then the invisible primary becomes a real race, a wide-open struggle to see who can raise the most money and move to the top of the polls before the Iowa caucuses, because, Mayer shows, that candidate almost always gets the nomination.

WOODRUFF: But, Bill, didn't George McGovern and Jimmy Carter emerge during the visible primaries?

SCHNEIDER: Well, that's right.

In the first two elections after the Democrats rewrote the rules and turned the nomination over to the primary voters, the party nominated long shots who gained momentum during the primaries: McGovern in 1972, Carter in 1976. Now, Professor Mayer's point is, that rarely happens anymore, since the invisible primary became decisive -- Judy.

WOODRUFF: All right, it's all in the eye of the beholder.

OK, Bill Schneider, thanks.

Still ahead: When Laura Bush visited a children's hospital today, she premiered a new video that you might say looks down on the White House.

We'll explain, so stay with us.


WOODRUFF: New fuel today for debate about President Bush's environmental record: His administration has approved a modest increase in fuel economy for SUVs and small trucks. The automakers say it will be a daunting challenge to boost fuel economy by 1.5 miles per gallon over three years, beginning with the 2005 models. But environmentalists say the increase is minuscule compared to what they believe is needed.

Strom Thurmond flies again. The man who flew into action in the storming of Normandy during World War II was honored again today. The Air Force named its 100 threat C-17 Globemaster the Spirit of Strom Thurmond to mark the retiring senator's 100th birthday. The airplane will be based in Thurmond's home state of South Carolina.

Coming up: canine cam at the White House.

We're back in a moment.


WOODRUFF: There's been yet another development in the ongoing controversy surrounding Senator Trent Lott.

Our John King reports from the White House that Senator Lott called President Bush a short time ago. The two had what is described as a mostly positive conversation. The president is described as standing by what his spokesman said earlier. It was the president's belief that Senator Lott should not step down from his position as majority leader, that he should remain in that position of leadership.

Well, as we reported earlier, first lady Laura Bush visited today with the youngest victim of the D.C.-area sniper attacks. But there was more to her trip to the Children's National Medical Center. Mrs. Bush brought holiday cheer and gifts to a number of young patients with the help of Santa Claus and the Bush family dog, Barney.

She also answered some important questions.


QUESTION: How does Santa Claus get into the White House?

L. BUSH: Well, one really good thing about the White House is there are lots of chimneys. So I don't know what chimney Santa Claus comes down, but...

MODERATOR: He brings lots of elves, too.

L. BUSH: That's right. He brings lots of elves. And I don't know if you noticed that Barney's claws on the floor kind of sounded like the reindeer on the roof, didn't they?


WOODRUFF: Mrs. Bush was referring just then to Barney the dog's starring role in a new holiday video that she brought along for the children to see. We told you last week about the plans for Barney to tour his home wearing a tiny camera on his collar. But Barney balked.

So, an aide took the camera and trailed Barney, I guess crawling along the floor there at the dog's-eye level, to provide this never- before-seen perspective of the White House. Not very cooperative.

That's it for INSIDE POLITICS. I'm Judy Woodruff.


Lott Still Under Fire For Comments At Thurmond Celebration>

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