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Budget Battle

Aired February 8, 2005 - 16:30   ET


ANNOUNCER: CROSSFIRE. On the left, James Carville; on the right, Robert Novak.

In the CROSSFIRE: President Bush hits the road to push a budget he says is focused on results.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: All budgets have got to be based on priorities. And mine are clear. The government's most solemn duty is to defend and protect the American people.

ANNOUNCER: But the salesmanship isn't stopping Democrats from blasting a budget they say has too many cuts.

SEN. KENT CONRAD (D), NORTH DAKOTA: That is not a plan to strengthen America. That is not a plan that is conservative. That is a plan that I would suggest to you is reckless.

ANNOUNCER: How will the budget impact you? And which parts of the budget can pass and which are dead on arrival?



ANNOUNCER: Live from the George Washington University, James Carville and Robert Novak.

NOVAK: There are two fronts in the battle over the budget. President Bush is going directly to the people, telling a group in Detroit about the benefits in his proposed spending plan. He says those benefits include cutting or getting rid of more than 100 government programs that are often repetitive or proven failures.

JAMES CARVILLE, CO-HOST: The other front is in Congress, where one Democrat says the budget would lead to a Mount Everest of mountainous debt.

Before we get into that, we have got the best little political briefing in television, our CROSSFIRE "Political Alert."

Remember when the administration was sending out people to call the French cheese-eating surrender monkeys and when we saw boycott- France stickers everywhere and just what a rotten nation France was and what rotten people the French were? Only for the reason that they had the temerity to be right about the Iraq war and say what everyone now admits, that it creates more terrorists and animosity and that we would bog down there forever.

Now the administration has taken to sucking up to the French. This is what Secretary of State Condoleezza Rice had to say speaking today in Paris: "It's time to turn away from the disagreements of the past. It's time to open a new chapter in our relationship and a new chapter in our alliance."

I guess the right-wingers will be drinking their Bordeaux again tonight.

NOVAK: Well, let me -- let me get this straight, James. When the administration is tough on the French for getting in bed with Saddam Hussein, they're bad. And now, when the chief diplomat is being diplomatic, they're bad. Isn't that, in your opinion, the Republicans are always wrong? Isn't that right?

CARVILLE: No, they're right about some things. They're right...


CARVILLE: Let me tell you something they're right about. What I'm saying is, you don't go out and call people cheese-eating surrender monkeys and this and that and everything else and call them weasels and then come and say, gee, we're going to kiss your butt.


NOVAK: Look at me. Look at me, James.

CARVILLE: I'm looking at you.

NOVAK: No, you're looking at the audience.


CARVILLE: ... nice-looking women out there. I'd rather look at them than you.


NOVAK: I'm telling you that you're saying that she shouldn't be a diplomat.

CARVILLE: I'm saying what you shouldn't do is spout your mouth off when people disagree with you, because you get it slapped.


NOVAK: The new Senate Democratic leader, Harry Reid, took the floor to whine that a Republican mailing criticized him undermines President Bush as a uniter. Let's see just what kind of uniter Harry Reid is.


SEN. HARRY REID (D-NV), MINORITY LEADER: There is a part of me that has great admiration for this White House in their ability to misdirect.

Much of what the president offered weren't real answers. That's an immoral burden to place on the backs of the next generation.


NOVAK: While deriding Republican partisanship, Senator Reid also trotted out the old canard about -- quote -- "the Republican plan to cut Social Security benefits while handing out lavish tax breaks for multimillionaires" -- end quote.

Bipartisanship, Harry, is not a one-way street.


CARVILLE: Now, let me ask you something. Harry Reid just got 61 percent of the vote in Nevada. What did that mailer say about Harry Reid?

NOVAK: It said -- it was critical of him, but the...


CARVILLE: But what did it say? You got some language?

NOVAK: The point is that Harry Reid goes on and he attacks Bush continuously. I got a whole stack of Harry Reid...


CARVILLE: Give me the stack. Let me see the stack. Can I see the stack? Where's the stack?

NOVAK: We just put some out there. I'll give them to you afterwards.

CARVILLE: But you don't have a stack right there, though, do you?



NOVAK: But, isn't that sickening?



NOVAK: I thought you and Begala liked attack politics.

CARVILLE: You know, what's sickening is this administration putting out this thing, which is nothing but a pack of lies. That's what sickening. You want to see something right here? That's it.

(BELL RINGING) CARVILLE: That's the sickening thing going on.

The administration is trying to lowball the exorbitant cost of their efforts to privatize Social Security by saying it will only add somewhere between $1 trillion and $2 trillion to the already soaring budget deficit. Of course, this is the same administration that told us that the prescription drug benefit would cost $400 billion over 10 years.

Now, thanks to this morning's "Washington Post" and Congressman Rahm Emanuel, we know that cost now is $800 billion and rising. So, common sense tells us that we can expect the Social Security plan to add somewhere between $2 trillion and $4 trillion. Do you know how you can tell when this administration is lying about anything? It's easy. They always do. Don't be confused. They never tell the truth.

NOVAK: James, you know, talking about lying about something, the administration has never made an official estimate of the so-called transition costs.


CARVILLE: Sure they have.

NOVAK: No, they haven't.


NOVAK: And the other factor is -- the other factor is, James, if you will listen, if you'll let me...


CARVILLE: I'm listening. You want me to read to you where they did?

NOVAK: Let me just tell you. Let me finish my sentence.

CARVILLE: Yes, sir.

NOVAK: It's hard to talk when you're interrupting.

CARVILLE: I understand. But you said they never did. I'm showing you what they did.

NOVAK: But the point of the matter is, it is going to take $1 trillion just to recover Social Security without any change in it. So, there's no additional expense for making the...


CARVILLE: What do you mean?

NOVAK: That's what it is.

CARVILLE: That's all poppycock. That's what the right wing puts out there. They got a problem about that big in Social Security.

NOVAK: I don't...

CARVILLE: Why don't they deal with things that are really a problem?

NOVAK: Why did Clinton say..


CARVILLE: The fact that...


NOVAK: Why did Clinton say it was a big problem?

CARVILLE: No, he said -- Clinton had a plan to deal with it. This is a plan to get rid of it.



Unlike Al Gore four years ago, John Kerry got off the floor and started a new campaign for president in 2008. That's fine, except what he's been saying shows why he lost the election by 3.5 million votes. On the "Imus in the Morning" radio talk show this week, Senator Kerry blamed Osama bin Laden, yes, for losing the presidency.

His polls went flat, he said, once Osama issued a tape. Kerry also complained about the treatment of his wife, Teresa, in "Newsweek"'s post-election account of the presidency. The would-be president said reading that article was like having a colonoscopy.

Senator, a majority of Americans felt that way just listening to you.


CARVILLE: Well, first of all, I admire him and very much agree with him defending his wife. I think that's a good trait. Secondly...

NOVAK: Do you think she...


CARVILLE: I don't think he lost the race because of Osama bin Laden. I think he lost the race because he didn't develop the right kind of narrative.

NOVAK: Well, I agree with that. But do you think she was an asset to him in the race or a liability?

CARVILLE: You know what? I think that, ultimately, it's about him and it's about his campaign. NOVAK: You thought she was a liability.

CARVILLE: You know what? I like the lady. What can I say? I'm not going to attack her. I like her.


NOVAK: You thought she was liability, though. Be honest.



NOVAK: This is television.

CARVILLE: I don't -- well, I don't think that she was a factor one way or the other. I think that Senator Kerry, at the convention, if they would have developed a certain toughness, if they would have had the right answer to Iraq, I think they would have won this thing easy. I think it was theirs for the taking.

NOVAK: OK, easy election, sure.

President Bush is talking about priorities and how to pay for them. The Democrats don't seem to like anything the president is talking about. The debate over dollars just ahead on CROSSFIRE.

And what could these three have in common? We'll have that story later.

ANNOUNCER: Join Carville, Begala and Novak in the CROSSFIRE. For free tickets to CROSSFIRE at the George Washington University, call 202-994-8CNN or visit our Web site. Now you can step into the CROSSFIRE.



CARVILLE: President Bush began the hard sell of his budget plan today, heading to Detroit's Economic Club to try to convince folks that cutting education, food stamps for the poor and health care for veterans is a good idea.

We've got a pair of congressmen in the CROSSFIRE today, Ray LaHood, Republican from Illinois, and Chaka Fattah, Democrat from Pennsylvania.

NOVAK: Congressman Fattah, let me let you see the president explain this budget very briefly and concisely. Let's listen to him.


BUSH: My budget reduces spending, reduces spending on nonsecurity discretionary programs by 1 percent, the most disciplined proposal since Ronald Reagan was in office. It holds discretionary spending below the rate of inflation.


NOVAK: Now, Congressman, with a big deficit and a war going on, you can't cut defense spending. Isn't this the time to cut nondefense spending? Even Franklin Roosevelt cut the nondefense spending during a war.

REP. CHAKA FATTAH (D), PENNSYLVANIA: Well, first of all, one word you will not hear this administration use when they talk about the budget is a simple word called balance.

Bush has never sent over a balanced budget. This is not balanced. It keeps raising the national debt. And the deficit is hundreds of billions of dollars. When Bill Clinton was in town, he sent over a balanced budget. We had the largest surpluses that the country has ever seen. So, on one level, we have the fiscal imbalance in this administration. On the other level, in terms of the cuts, Republicans have been in the majority for 10 years.

Every single program that the president says he wants to cut, the Republican majority in the House and the Senate has supported over the last 10 years.


FATTAH: So are they wasteful...

NOVAK: Wait a minute. Wait a minute.


FATTAH: ... and my colleagues put in wasteful spending or are they needed programs that we need to move the country forward?

NOVAK: I got your point. And you state it beautifully.

But I still would like you to answer my question. When you've got a big deficit, got a deficit, and when you got a war going on, isn't that the time to have a 1 percent decrease in nonsecurity spending?

FATTAH: I think that, at the end of the day, the Congress will meet the budget of ceilings that the president has laid out. We'll have a different set of priorities. But the point you need to know is that no president at war cut taxes $1.5 trillion, like Bush did.

NOVAK: You didn't answer my question. I tried twice. I won't try a third time.

FATTAH: The reason why we have an imbalance is because he wanted to help some of his wealthiest friends pay less in taxes and have no sacrifice, while we have the rest of the country feeling the pains of this war.

CARVILLE: Congressman LaHood, you have one of the most agriculturally productive districts in the country in the area surrounding Peoria, Illinois in central Illinois. The president is calling for cuts in agricultural programs. Do you remember any time during the campaign when he was campaigning in the Midwest, in the Farm Belt that he was talking about cutting agricultural programs?

REP. RAY LAHOOD (R), ILLINOIS: Well, one of the things he has talked about in the budget is trying to make permanent the tax cuts.


LAHOOD: That's a good thing for folks in agriculture.


LAHOOD: To eliminate the inheritance tax.

CARVILLE: Right. Right.

LAHOOD: To make the tax cuts permanent, to make the child tax cut permanent, those are all...

CARVILLE: So we can expect Ray LaHood to be on the point cutting these agricultural subsidies and helping the president get this through?

LAHOOD: Well, the president proposes and the Congress disposes.


LAHOOD: The president has proposed cuts in the past in agricultural programs. The best thing we can do for our friends in agriculture is make permanent the elimination of the death tax, the child tax credit and the tax cuts that have helped all Americans.

CARVILLE: How many people in your district have lost their farm because of the estate tax?

LAHOOD: A lot of them have been able not to pass their farms on.

We've lost the ability of the family farm to be passed on because people have to sell off half the farm in order to pay the so-called inheritance tax.

NOVAK: Congressman Fattah, person who is nonpolitical -- Republicans and Democrats all hang on his word -- is the chairman of the Federal Reserve, Alan Greenspan.

And here's what he says about the present administration policy. He says -- quote -- "The voice of fiscal restraint, barely audible a year ago, has at least partially regained volume" -- end quote. In other words, he says that, by cutting these domestic programs, we've got fiscal restraint. Is Greenspan deluded?

FATTAH: Well, I think if you really look at what he said, he talked about the irresponsibility on the front end. He says it's like what we have now is, we have central banks around the world retreating from U.S. assets.

We have the highest deficits ever. We've added over $2 trillion under this administration to the national debt. He's right when he talks about the inheritance tax being a concern to some in our country. But for every child born, we have a birth tax now of $36,000 in debt that those...

NOVAK: Well, that's...

FATTAH: On the heads of people that will have to carry forward, because, rather than be adults and pay as we go, this administration has decided to spend and borrow.


NOVAK: You don't want to address the things I asked you. I said that he says the voice of fiscal restraint is back. This is a fiscally restrained budget. Can you concede that?

FATTAH: I think what he said is, obviously, there had not been a voice of restraint in the last four years.

And just because the president says today -- every expert outlined -- and, for instance, "The Washington Post" today said these cuts are not going to materialize. There will be less than a dozen programs cut out of the 150.

NOVAK: Oh, because you won't cut them.

FATTAH: No. We're not in the majority. The Republican Party is in charge. They've been charge of the Congress and spending for 10 years.

So, if they have been funding wasteful programs, I don't think my colleagues would agree that they have been. They have been funding needed programs that our country needs in education and farm support.

NOVAK: Will you vote to cut these programs?

FATTAH: Look, I'm going to allow the majority to -- as it is set up in our democracy, to work its will.


CARVILLE: Congressman, one of things that the president's budget calls for is to let poor kids get a little skin in this game and cut Medicaid funding, which goes to their health insurance. Can you think of any sacrifice the president is asking Bob Novak and I to make, two high-income post-60 guys? Is there anything -- is there anything that the president is asking me to do for my country in this budget?

LAHOOD: James, you know as well as I do, there's a lot of waste, fraud and abuse in the Medicaid program.

CARVILLE: Right. Right.

LAHOOD: There really is.


LAHOOD: And that's what the president is going after.


LAHOOD: He's not trying to hurt poor people.


CARVILLE: ... one thing in there about this. He is asking poor children, children with juvenile diabetes, children with cleft palates, children with holes in their heart, to get a little skin in this game to sacrifice something for their country. What is he asking me, a 60-year-old rich guy, to do?

LAHOOD: Well, what he's saying is that there's a lot of waste in government, including in the Medicaid program.

CARVILLE: But he ain't asking me to do anything, is he? If you're a rich guy over 60...

NOVAK: Let him answer the question. Let him answer the question.

CARVILLE: I'm saying...


NOVAK: No. You're interrupting him. You're not letting him answer.


CARVILLE: ... waste, fraud and abuse. I'm just saying...

NOVAK: Let him answer the question.

CARVILLE: What is he asking me to do?

OK answer it. What is he asking me to do?

LAHOOD: Well, he's asking you to pay your fair of the taxes that are required because of the fact that you're one of these talk show hosts that makes a lot of money.

CARVILLE: Right. And I'm getting hundreds of thousands of dollars.


NOVAK: Let's take a -- let's take a break, take a break. We're taking a break now.

(CROSSTALK) NOVAK: Up next, we'll tell you how people rate the president's plan plans compared to the plans of the Democrats.

And would the pope's health lead him to consider stepping down? Wolf Blitzer has the latest on that question just ahead.


WOLF BLITZER, CNN ANCHOR: I'm Wolf Blitzer, reporting from Washington.

Coming up at the top of the hour, the Pentagon releases dramatic new spy plane video from Iraq, along with new estimates of how many insurgents are operating there and how many already have been killed.

The Vatican says the pope's health is improving, but is there any possibility he'll resign?

And Don Cheadle has an Oscar nomination for "Hotel Rwanda." We'll talk with him about the movie and his recent trip to Sudan, where the death continues.

All those stories, much more, only minutes away on "WOLF BLITZER REPORTS."

Now back to CROSSFIRE.

NOVAK: The president is taking a strong stand, calling for an end to ineffective government programs. The question now, how many in Congress will go along, especially if it means getting rid of popular and wasteful programs?

Still with us, two members of the House Appropriations Committee, Chaka Fattah, Democratic congressman from Pennsylvania, and Ray LaHood, Republican congressman from Illinois and maybe the next governor of Illinois.

LAHOOD: We'll see.

NOVAK: We'll see.

CARVILLE: Congressman LaHood, the president said that he would cut the budget deficit in half in 10 years. Does this -- how much does this budget cut the deficit? Is this really an axe-cutting budget here?

LAHOOD: Well, this is the first year of the 10 years.


CARVILLE: And how much is this -- what are they projecting we're going to cut off the deficit here?

LAHOOD: Well, the president's making a good-faith effort to abide by what he said during the campaign, that he believes deficit reduction is very important. And this is the first start. CARVILLE: But what's the start? How much? What's the figure here? We got a figure? I understand, but there's a figure.

LAHOOD: We also are trying to win the war on terror and also win the hearts and mind of the people in Iraq.

CARVILLE: I understand.

LAHOOD: And we're setting up a democracy there.


LAHOOD: And millions of people went to vote.


LAHOOD: And we're going to have an $80 billion supplemental appropriation.


LAHOOD: This war on terror is costing us a lot of money.

CARVILLE: Right. Right. So we ain't cutting the deficit any is what it is. OK. That's all.

NOVAK: Mr. Fattah, I want to show you a poll just taken by Gallup for CNN and "USA Today," policies -- whether policies would move the country in the right direction. President Bush's policies, 55 percent, yes. Republicans in Congress, 50 percent yes. Democrats in Congress, 41 percent yes, 14 points behind President Bush.

In other words, your big spending, partisanship, tax the rich, that doesn't go over, does it?

FATTAH: This is the big secret that we have got to let people in on. There's not an appropriations bill in the last 10 years that the -- that Democrats passed in the Congress. We haven't spent any money of your taxes in the last decade.

Republicans are in the majority, Bob. Everybody's got to get used to that.

NOVAK: I know. You've made that point. I let you make that point.

FATTAH: Now, so, if you want to blame someone for wasteful spending, the Republicans are in the majority.

NOVAK: Why do the American...


FATTAH: That's what you have got to focus on.

NOVAK: Why do the... FATTAH: If you want to talk about, if you want to talk about young people who are risking their lives in Iraq without enough bullets or bulletproof vests or armored Humvees...

NOVAK: Well, let me ask you my question.

CARVILLE: Let him answer it.

FATTAH: Bush is the commander in chief.


CARVILLE: Let him answer.

FATTAH: We are in the age of accountability.


NOVAK: All right. I want you to be...

FATTAH: What the public needs to start to do is not deal with the Democratic boogeyman from the past, but focus on who's running the country now.


FATTAH: They've been running it. They are now responsible.

NOVAK: I want to -- wait a minute. Let me ask the question.

Let me ask you why you think the American people think that the president's policies are moving the country in the right direction and your policies are moving them in the wrong direction? Why is that?


FATTAH: The Americans are optimistic by their nature. And they are hopeful. But the truth is, we went from balance budgets under Clinton, the largest surpluses in the nation's history.

NOVAK: You don't have an answer for that.

CARVILLE: Sure, he does.

FATTAH: To the largest deficits in the nation's history.

We have major fiscal problems on our hand. And they're hopeful, optimistic beyond the facts that Bush might turn around his reckless fiscal behavior for the first four years and actually start to act like a Republican and...

CARVILLE: Congressman LaHood, you get the last word.

FATTAH: ... balance the budget.

CARVILLE: You get the last word. Go ahead. (CROSSTALK)

LAHOOD: Listen, the president -- the president -- this last election was a referendum on President Bush. It was a referendum on the war on terror.


LAHOOD: It was a referendum on his policies.


LAHOOD: And he won the referendum.


CARVILLE: Right. Right.

LAHOOD: And we also won the referendum in the Congress.

CARVILLE: Are you going to be with the president to privatize Social Security? He can count on your vote for his Social Security plan?

LAHOOD: I'm going to do what the president asks us to do.


CARVILLE: So if he asks you to vote that way...

LAHOOD: Let's wait for the details, James. Let's see what the details...


CARVILLE: So if the president asks you to do something, you're going to do it? You're going to stand with the president 100 percent?


FATTAH: You won't find a Republican who will vote for this budget, all right?

NOVAK: Congressman LaHood, thank you very much.

Congressman Fattah, thank you very much.

Just ahead, how did the Reverend Al Sharpton end up in this crowd?


NOVAK: If you've been wondering what Dennis Rodman, Pamela Anderson and the Reverend Al Sharpton have in common, never let it be said that CROSSFIRE doesn't have all the answers. All three are involved with the folks at PETA. That's People for the Ethical Treatment of Animals. Rodman is the latest, showing off his tattoos and nothing else in a new anti-fur ad with the slogan "Think Ink, Not Mink." The former NBA star says his perspective has totally changed after seeing one-time "Baywatch" actress Pamela Anderson in a PETA video. Rodman and Anderson have now been in PETA's rather-go-naked-than-wear-fur series.

The Reverend Sharpton is joining a PETA protest against fast-food giant Kentucky Fried Chicken. But, thankfully, Reverend Al is keeping his clothes on.


CARVILLE: You know what? I hope he keeps them on, but I'll have to see this Pamela Anderson thing. If that converted Dennis Rodman, it must be one hell of an ad, huh?

NOVAK: I wonder if she can rebound as well as he can.

CARVILLE: I don't know.


NOVAK: If you know what I mean.

CARVILLE: I'd rather see her. Yes, I got you there.

All right, from the left, I'm James Carville. That's it for CROSSFIRE.

NOVAK: From the right, I'm Robert Novak. Join us again next time for another edition of CROSSFIRE.

"WOLF BLITZER REPORTS" starts right now.



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