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Inside Politics

Swift Boat Battle; Attendance Matters

Aired August 20, 2004 - 15:30   ET

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

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


(BEGIN VIDEOTAPE)
SEN. JOHN KERRY (D-MA), PRESIDENTIAL CANDIDATE: They had personally raped, cut off ears, cut off heads...

UNIDENTIFIED MALE: The accusations that John Kerry made against the veterans who served in Vietnam was just devastating.

ANNOUNCER: A new salvo in the fight over John Kerry's Vietnam War record.

UNIDENTIFIED MALE: As a member of the Intelligence Committee, Senator Kerry was absent for 76 percent of the committee's hearings.

ANNOUNCER: A serious charge. Is it true? Releasing the records to settle this matter may not be so easy.

There's more than just the White House up for grabs this November. Can the Democrats retake the Senate from the Republicans? We'll take a closer look at the battle for Congress.

(END VIDEOTAPE)

ANNOUNCER: Now, live from Washington, JUDY WOODRUFF'S INSIDE POLITICS.

WOLF BLITZER, HOST: Thanks very much for joining us. I'm Wolf Blitzer. Judy is off today.

Veterans on the attack against John Kerry are making it clear once again today they're prepared to fight on despite the senator's personal attempt to discredit them as a front for President Bush. The group called Swift Boat Veterans for Truth today unveiled a brand-new ad. At the same time, a new poll offers the first measure of how the public is responding to the controversy.

(BEGIN VIDEOTAPE)

KERRY: They have personally raped, cut off ears, cut off heads...

UNIDENTIFIED MALE: The accusations that John Kerry made against the veterans who served in Vietnam was just devastating.

KERRY: ... randomly shot at civilians...

UNIDENTIFIED MALE: And it hurt me more than any physical wounds I had.

BLITZER (voice-over): The new ad by the so-called Swift Boat Veterans for Truth gets to the heart of their anger at John Kerry: his 1971 Senate testimony on alleged U.S. war crimes in Vietnam. Veterans who are now critical of Kerry make no bones about the fact that they were outraged by his anti-war activities after returning from Vietnam.

UNIDENTIFIED MALE: He dishonored his country and, more importantly, the people he served with. He just sold them out.

BLITZER: The Kerry campaign is condemning the new ad saying, "This Republican front group for Bush is out of credibility after being caught lie after lie, day after day."

UNIDENTIFIED MALE: You are aware you've been one of the strongest critics of this war for the longest time.

BLITZER: The does not ad include Kerry telling senators that the war crimes charges he outlined were based on the testimony of over 150 Vietnam veterans.

KERRY: Of course, this group isn't interested in the truth. They're not telling the truth.

BLITZER: A day after Kerry personally responded to the Swift Boat Veterans for Truth, he did not discuss the controversy, focusing instead on domestic issues. But a new poll may help explain why he decided to fight back. The Annenberg Survey found 57 percent of Americans say they have seen the original Swift Boat ad or heard talk about it.

UNIDENTIFIED MALE: John Kerry lied to get his Bronze Star. I know. I was there. I saw what happened.

BLITZER: Those who are aware of the ad are split on whether it's believable. Of all those surveyed, 59 percent say they think Kerry did earn all of his war medals. Twenty-one percent say he did not earn them. Twenty percent are unsure.

KERRY: They're funded by hundreds of thousands of dollars from a Republican contributor out of Texas.

BLITZER: The Kerry camp continues to press its charge that the Swift Boat Veterans for Truth is a front for the Bush campaign. "The New York Times" today reports what it describes as a web of connections between the group behind the ad and the Bush family: high- profile Texas political figures and the president's top political strategist, Karl Rove.

Apparently, picking up on that, the Kerry camp today charged, "Karl Rove's attack squad of convincing the Swift Boat Veterans to lie." The Swift Boat group denies any direct contact with the RNC, the Bush White House or any Republican group.

LARRY THURLOW, VIETNAM VET: I've had absolutely no contact with any of them, nor do I plan to, nor can they tell me not to take part in the Swift Boat group's campaign.

(END VIDEOTAPE)

BLITZER: And the Swift Boat Veterans for Truth say their new ad will air beginning Tuesday in three states. They've not yet chosen which those -- which of those states be included. They say they will have a budget of around $600,000 to pay for those ads.

The Bush White House says it is not involved with the Swift Boat ads in any way and suggests John Kerry is simply overreacting. CNN's Jill Dougherty is covering the president. She's joining us now live from Crawford, Texas.

What's the latest from there, Jill?

JILL DOUGHERTY, CNN CORRESPONDENT: Well, Wolf, you said overreacting, but what the operative phrase from the White House today was Senator Kerry is "losing his cool" over this issue. It came from Scott McClellan, who gave a briefing to reporters. And, actually, he was responding to a question from reporters about that "New York Times" story that alleges this web of connections between the people involved in the ads and the Bush family, Texas people, and Karl Rove.

So he immediately said, no, there is no connection, categorically, as the campaign says, between them. But then he went after Senator Kerry.

(BEGIN VIDEO CLIP)

SCOTT MCCLELLAN, WHITE HOUSE PRESS SECRETARY: We've already said we weren't involved in any way in these ads. We've made that clear.

I do think that Senator Kerry losing his cool should not be an excuse for him to lash out at the president with false and baseless attacks. I mean, where has the Kerry campaign been for the last year while more than $62 million in funding through these shadowy groups have been used to negatively attack the president?

(END VIDEO CLIP)

DOUGHERTY: So the presidential spokesman said that Senator Kerry has been noticeably silent, as he put it, on these attack ads, and said the campaign is actually fueling more of these ads. And then, as they've said before, Wolf, he said, look, we could end this today if Senator Kerry would join the president and say let's just stop all these ads.

BLITZER: Jill Dougherty reporting for us from Crawford, Texas. Thanks, Jill, very much.

Let's go now to the John Kerry campaign. I'm joined live by campaign senior strategist Tad Devine.

Tad, thanks very much for joining us. Where's the hard evidence directly linking the Bush White House or the Bush-Cheney campaign to these ads as alleged yesterday by John Kerry? TAD DEVINE, SR. STRATEGIST KERRY CAMPAIGN: Well, Wolf, it's in "The New York Times" today. There's a big chart. You know, you can take a look at it. OK?

The connections, the web of connections between this effort and the campaign are obvious for anyone to see. And, by the way, Wolf, this is part of pattern.

This is what George Bush does. He did it precisely against John McCain. They have others front for them, do their dirty work for them. They stand there and do nothing. And for the president of the United States to stand there and say nothing about this is reprehensible.

BLITZER: Well, I read the entire "New York Times" article and our viewers did. In fact, I spoke earlier today with one of the reporters who wrote the article. They don't have any hard evidence backing it up.

They have a web of connections, as you say, but there's nothing specific...

DEVINE: Sure.

BLITZER: ... because if there were, they would be breaking the law. There's a -- there's a campaign fund-raising violation that would clearly be violated. Give me the specific, name names. Who is doing this?

DEVINE: Wolf, it's obvious for everyone to see. These are Texas fund-raisers, it's precisely what happened to John McCain four years ago. They've got a web of connections between them and the Bush campaign.

They take these people. Once removed from the campaign -- and obviously they're doing it deliberately that way. They do not want the legal connections between the campaign, they're once removed from the campaign. Every time we look closer and closer at this, this is what we discover...

BLITZER: All right.

DEVINE: ... the connections between the campaign and the lies and distortions at the heart of the Swift Boat Veterans.

BLITZER: All right. So let me repeat the question. Name some names, the connections between the campaign or the White House, on the one hand, and these Swift Boat Veterans, those who are funding these ads on the other. Go ahead. Connect the dots.

DEVINE: Well, Wolf -- Wolf, I don't know how it can be anymore explicitly clear than it is in the chart in today's "New York Times." I mean, it's laid out person by person, the connections between Karl Rove and the major fund-raisers, the connection between the people making these ads, the long history of connections between them and George Bush and president -- the previous President Bush, the president's father.

These connections go back years and years. It's the same tangled web of people who tried to do this to John McCain four years ago. But let me tell you something. It's not going to happen to John Kerry.

John Kerry will fight back. He's -- and he's going to challenge the president as John McCain challenged the president, to stand up, to denounce these ads. And every day that goes buy that the president fails to denounce these ads just demonstrates his complicity in these efforts.

BLITZER: All right. So I've heard one name, Karl Rove. Are you saying Karl Rove coordinated with the Swift Boat for Veterans -- that the Swift Boat Veterans for Truth coordinated this ad campaign? Is that the allegation?

DEVINE: Well, Wolf, to demonstrate this, we'd have to go to court, we'd have to depose people, we'd have to put them under oath, we'd have to subject them to all the process of a legal examination. I think the facts are obvious here. It's for everyone to see.

A bunch of rich guys from Texas with long connections to the Bush campaign come out and try to destroy a veteran of the Vietnam War. It happened twice. They did it once in 2000; they're trying to do it again in 2004. The only difference is it's not going to succeed this time. That's the big difference.

BLITZER: Let me throw it this way to you.

DEVINE: Sure.

BLITZER: There are a bunch of rich Democrats out there, a bunch of active Democratic activists out there who are involved in all sorts of 527 independent ad campaigns smearing the president of the United States and the vice president right now. Because they have a long history working with other Democrats, with Kerry supporters and strategists, does it make them in violation of the law as well?

DEVINE: Wolf, when John McCain challenged Senator Kerry days ago to denounce an ad attacking the president's lack of service in the National Guard, within hours Senator Kerry spoke up publicly and denounced the ad. It's so different from what this president is doing.

This president is attempting to put out this group do his dirty work for him, and that's because the president cannot talk about economy, health care, energy independence, or how he's going to defend the nation, particularly his failure in Iraq. This is a deliberate effort on their part to distract the voters' attention away from the failures of George Bush's administration.

BLITZER: Are you going to file a complaint with the Federal Election Commission?

DEVINE: Wolf, listen, they're trying to tie us up in legal process, trying to distract this campaign and the American people from the real issues. I'll tell you what we're going to do.

We're going to continue to talk about John Edwards and John Kerry's plan to make America stronger at home and respected in the world. We're going to do that every day. And at times we will hold them up to the light of day. And when they are exposed, as they have been recently in the mainstream press, they will see they are liars and bigots. And the more of that scrutiny on this group the better for us.

BLITZER: Why did John Kerry wait so long to respond this Swift Boat Veterans for Truth?

DEVINE: Well, Wolf, because, obviously, when we respond it's going to be launched on to a broad national stage. And that's a tactical decision you have to make in campaigns. But the lies had built up to such an extent we decided to talk about it.

He felt very strongly himself that this needed to be answered. He wrote the answer himself, he delivered it powerfully in Boston the other day.

Now, he's not going to spend all of his time talking about this because he is determined to change the course of this nation. But we will point, and I think rightfully so, that this president, George W. Bush, is behind this attack, is complicit in it, and is failing to live up to his responsibility as commander-in-chief to stand up and defend a decorated war veteran, John Kerry.

BLITZER: Yesterday, the Democratic nominee challenged President Bush and said if he wants to have a debate over their service during the Vietnam War, he had a very strong challenge to him. I want you to listen to what John Kerry said -- well, actually, we don't have that sound bite.

DEVINE: Just bring it on.

BLITZER: But he just basically said -- he said, "Bring it on." What is the point? What was John Kerry saying about the president of the United States and his service in the Texas Air National Guard?

DEVINE: Well, Wolf, I think what he was saying was "our" service, and I believe who he was referring to was himself and the crewmates he served with. Everyone, Wolf, who has seen any of these episodes has offered first-person testimony to what happened.

People like John O'Neill, who wrote this book, weren't even there. People like his co-author, who's been exposed as an anti- Catholic, anti-Semitic bigot, weren't even in Vietnam. So John Kerry was talking -- when he said "our" service, he was referring to himself and his crewmates, not to the president.

BLITZER: But was he smearing the president because the president didn't volunteer to go to Vietnam?

DEVINE: No, he was not smearing the president. He was talking about "our" service, himself and his crewmates, the people who actually saw the heroism that resulted in John Kerry winning a Silver Star, a Bronze Star and three Purple Hearts. Those events happened.

And you know, Wolf, lies can be powerful. And these guys have demonstrated that. But the truth is even more powerful. And as the American people find out the truth, that these are distortion and lies about John Kerry, and that George Bush is behind it, the president will pay a heavy price.

BLITZER: Tad Devine from the Kerry campaign. Thanks very much for joining us.

DEVINE: Thank you.

BLITZER: And this note to our viewers. Later on this program we'll get some Republican reaction to the Swift Boat controversy. I'll speak with the Bush campaign chairman, the former governor, Marc Racicot.

The Kerry campaign is getting flak on more than one front today. Coming up, John Kerry's attendance record on the Senate Intelligence Committee. Should the records be released?

Plus, the Senate Intelligence Committee chairman on the records flap (ph), and his disagreements with the president and some other fellow Republicans.

And later, can playing the hero merit the "Political Play of the Week?"

With 74 days until the election, this is INSIDE POLITICS, the place for campaign news.

(COMMERCIAL BREAK)

BLITZER: Welcome back. A new Bush campaign ad takes direct aim at John Kerry's attendance record as a member of the Senate Intelligence Committee. Our congressional correspondent, Ed Henry, reports on the debate, over-attendance, and explains how this issue could entangle members of both parties.

(BEGIN VIDEOTAPE)

ED HENRY, CNN CONGRESSIONAL CORRESPONDENT (voice-over): Senators Kerry and Edwards, who have touted their service on the Intelligence Committee, are under fire for skipping many of the panel's public sessions.

UNIDENTIFIED MALE: Senator Kerry was absent for 76 percent of the committee's hearings.

HENRY: Democrats say that number is skewed. It does not include the hundreds of private and classified meetings held during Kerry's tenure on the panel from 1993 through 2000. So Republicans have called Kerry's bluff, demanding that he and Edwards ask the committee to release the classified portion of their attendance figures to see how many of those sessions they attended. SEN. PAT ROBERTS (R), INTELLIGENCE CHAIRMAN: All John Kerry has to do and all that John Edwards has to do is write us or pick up the phone and call me, say, "Hey Pat, hey Jay, hey Senator Rockefeller, hey Senator Roberts, please release my records, and not only the public records, but the closed records." And then the matter is over.

HENRY: Chairman Roberts said committee rules allow him and vice chair Jay Rockefeller to decide whether to release the records. But Democrats insist such a precedent-setting move would trigger a vote in the Intelligence Committee. That could be a slippery slope because senators in both parties routinely miss public hearings and private meetings.

Democrats privately warn they will push to release the attendance of every senator during the time Kerry and Edwards served on the committee. Democrats insist the Republicans would never go for that because both parties would be embarrassed. Bush campaign officials say Democrats are committing a smoke screen and Kerry and Edwards should be held to a higher standard than other senators because they are running for higher office.

ROBERTS: You have both candidates saying this: because of our intelligence background on the committee, more especially John Edwards, who has indicated it wouldn't have take us three years to make the changes after 9/11 that we need to make, well, Senator Edwards made a decision to run for vice president.

HENRY: By that standard, Democrats say Vice President Cheney's tenure on the House Intelligence Committee is fair game. They say Cheney attend only one of the seven public hearings the committee held from 1985 through 1989. Cheney's tenure was before 9/11, but so was Kerry's.

REP. JANE HARMAN (D), INTELLIGENCE VICE CHAIR: I don't believe that Senator Kerry has been a member of the Senate Intelligence Committee since 2000. And I think the ad is somewhat misleading.

It implies that he -- he has been and that he was AWOL. If he missed some hearings in the '90s, that's a fair issue. But that does not apply to post-9/11.

(END VIDEOTAPE)

HENRY: Wolf, I just got off the phone with the Bush-Cheney campaign. They insist that the Democrats' numbers are wrong, that Vice President Cheney only missed one hearing in the 1980s of the House Intelligence Committee.

They say this has been concocted out of (UNINTELLIGIBLE). Bush- Cheney spokesman Steve Schmidt says that the Democrats are on the run because John Kerry is on the defensive about this. They say that the campaign is just trying to have a distraction here.

And what Steve Schmidt is saying is that, bottom line, John Kerry has to make a phone call to Chairman Pat Roberts and say, "Turn those records over, release them." But I can tell you, I've been talking to a lot of people close to John Kerry. They say he has no intention of making that phone call -- Wolf.

BLITZER: Now, isn't it a fundamental fact -- and you and I have covered Capitol Hill for a long time -- that if they start going down this slippery slope about absenteeism, which senators or members of the House actually go to committee hearings, public ones or private ones, there's going to be a lot of embarrassment on the Republican and Democratic side?

HENRY: Absolutely, because senators are on three, four committees, sometimes. They're juggling meetings, all their schedules are busy. They're fund-raising, they're doing a lot of things in addition to official business. But I can tell you, the Republicans feel very confident here that their numbers are going to be better, and they also feel that they do have the Kerry campaign on the run.

When you talk to political analysts out there, they say that John Kerry is trying to make intelligence a key part of his campaign. This puts him on the defensive. But they also say that if he's not showing up for these hearings, that's going to also look like since he's not releasing the records he's hiding something -- Wolf.

BLITZER: I guess one of the down sides of having two sitting senators on the same ticket, a lot of voting records, a lot of attendance records that can be reviewed.

HENRY: Absolutely.

BLITZER: Ed Henry, thanks very much for that good report.

And hopefully here on INSIDE POLITICS today we'll speak with the chairman of the Senate Intelligence Committee, Pat Roberts of Kansas. We expect to speak with him at some point, get his assessment on what's going on.

Natural disasters can put a big, big wrinkle in planning for a major election. Coming up, how Florida's election machine is coping with the aftermath of Hurricane Charley.

(COMMERCIAL BREAK)

BLITZER: Yet another response today to veterans' attacks on John Kerry. This time in a new ad by the Democratic National Committee.

The spot features retired General and former Air Force Chief of Staff Tony McPeak. After endorsing George W. Bush four years ago, McPeak says he's supporting Kerry this year because he has -- and I'm quoting now -- "the strength and common sense we need in a commander- in-chief." The ad is part of a $7 million ad buy in battleground states.

Florida Governor Jeb Bush has declared an elections emergency in counties hit hard last week by Hurricane Charley. The governor's declaration allows local officials to delay early voting and it gives them more time to hire and train poll workers.

Florida's primary is less than two weeks away, on August 31st. Bush and the secretary of state have indicated the primary will be held as scheduled, even if people have to vote inside tents and generators are used for power.

More in our next half-hour from Florida on Charley's aftermath. But coming up right after the break, John Kerry touches down for a first-hand look at the Hurricane's handiwork.

Later, the Senate scramble. We'll take a closer look at this November's key races.

(COMMERCIAL BREAK)

(BEGIN VIDEOTAPE)

ANNOUNCER: A new blast at John Kerry's Vietnam War records.

KERRY: Crimes committed on day-to-day basis...

UNIDENTIFIED MALE: He betrayed us in the past. How could we be loyal to him now?

ANNOUNCER: Are the attacks hurting Kerry's bid for the White House?

The fight for the showdown states. We've got new polls in two crucial states that could decide the election.

It's Friday, and that means the "Play of the Week." Stick around. Bill Schneider will reveal the winner.

(END VIDEOTAPE)

ANNOUNCER: Now, live from Washington, JUDY WOODRUFF'S INSIDE POLITICS.

BLITZER: Welcome back. I'm Wolf Blitzer, sitting in today for Judy.

John Kerry is in Florida this hour, touring damage from Hurricane Charley. At the same time, his campaign continues to do damage control over ads attacking his war record in Vietnam and his antiwar activities after returning home. CNN's Dan Lothian is traveling with John Kerry.

(BEGIN VIDEOTAPE)

DAN LOTHIAN, CNN CORRESPONDENT (voice-over): Even as the anti- Kerry group Swift Boat Veterans for Truth prepare to roll out another ad critical of the senator's Vietnam War rhetoric...

UNIDENTIFIED MALE: He betrayed us in the past. How could we be loyal to him now?

LOTHIAN: ... Kerry tried to refocus his campaign on domestic issues important to voters.

UNIDENTIFIED MALE: I was furloughed in December of 2002, and that's when I started looking for retraining.

LOTHIAN: Meeting with laid-off workers being retrained at a Charlotte, North Carolina, community college...

UNIDENTIFIED MALE: John Kerry!

LOTHIAN: ... and later, with more than 700 others gathered at the school, Kerry touted his economic plan which he says will restore prosperity to every American.

KERRY: We're just going to go back to where we were with Bill Clinton, when people got rich and the country did well.

LOTHIAN: His plan? To end tax breaks for companies that ship jobs overseas and to enforce trade agreements. But recognizing the forces of economic trends, Kerry told the crowd he won't promise what he can't deliver.

KERRY: One thing I know people all across this country want more than anything else is leadership that looks them in the eye and tells the truth.

(END VIDEOTAPE)

LOTHIAN: The Kerry campaign says that the senator will continue to vigorously defend his record. Now, as for the new ads, campaign aides say that you can just take a look at the credibility that's being lost by the groups behind the ads, they say they've just been telling, quote, "lie after lie day after day."

Now Senator Kerry as you mentioned, Wolf, is here in Florida touring the devastated areas hit by Hurricane Charley last week. The campaign was expected to come here on a campaign stop just before the hurricane slammed into Florida and decided to put off that campaign trip here feeling that it would be a distraction and decided to come now at the invitation of Senator Bill Nelson -- Wolf.

BLITZER: And, Dan, on this day after he went on the offensive on the Swiftboat Veterans For Truth he made no mention whatsoever of this controversy today?

LOTHIAN: That is correct, Wolf. No mention of that. You're correct. Yesterday, he did come out aggressively, tried to defend his war record. Today, no mention of that, instead, tried to stay on message. And as I mentioned, his campaign saying that he will continue in the future to vigorously defend his war record -- Wolf.

BLITZER: CNN's Dan Lothian covering John Kerry today in Florida. Thanks, Dan, very much.

We're getting somewhat of a better idea now of how the Swiftboat controversy may be affecting the White House thanks to some brand new poll numbers. Let's bring in our senior political analyst Bill Schneider. Bill, what are the poll numbers showing right now, as far as whether they believe the Swiftboat Veterans as part of these ads or they believe John Kerry? WILLIAM SCHNEIDER, CNN SR. POLITICAL ANALYST: Well, the Annenberg Center of the University of Pennsylvania, the Annenberg School did a poll in which asked people who had seen or heard about the ad, that's a majority of Americans, because the ad has been shown and talked about so much on radio and television, do you find the charges believable? Do you find the ad believable?

The answer is they're split down the middle. About half, 46 percent say they find the ad very or somewhat believable and about half, 49 percent say they find it very or somewhat unbelievable. As you'd expect, Republicans say they find it believable, Democrats don't but Independents who are the people who come at this without any predispositions are split right down the middle.

BLITZER: So how is it impacting the horse race, if it is at all?

SCHNEIDER: Well, here's what we know. There is a CBS News poll just out which shows there has been a slight shift since the period right after the Democratic convention. Immediately after the convention the race stood at 48 percent for John Kerry, 43 percent for Bush. Now, the race is virtually a tie. 46 Kerry, 45 Bush.

What that indicates is about a two-point shift, not very big but a two-point shift among voters from Kerry to Bush. Does this have anything to do with the ads? Well, what they found in that CBS News poll is that the biggest shift came among veterans. They're only 16 percent of the voters, so they're not a big group. But take a look. After the Democratic convention, veterans were tied, 46 Kerry, 46 Bush. Now, veterans are 55 percent for Bush, 37 percent for Kerry. Notice that there is a nine-point shift among veterans from Kerry to Bush. The suggestion is, at least the possibility is there that the Swiftboat ad angered a lot of veterans.

BLITZER: I thought after the Michael Dukakis blunder of '88, when he refused to respond to the attacks against him and waited and waited and waited, the Democrats had learned from that experience, which raises a question, why did John Kerry wait so long, more than a week, two weeks to actually respond to these attacks?

SCHNEIDER: He is responding right now and he's responding forcefully and in person. This CBS News poll was taken just before we heard from Senator Kerry and indicated damage has been done. I think probably, this is only a guess but Kerry waited to see if the ad was doing any damage, if anyone found it believable. He found that there was some damage there and then he spoke out, learning the lesson from Michael Dukakis not to let these charges lie there.

BLITZER: I guess you can't wait very long. Whenever you're attacked you have to attack right back. Bill Schneider will be back later on INSIDE POLITICS with his political play of the week. Can't wait to hear what it is. Thanks very much, Bill, for that.

And we'll also get the Republican take on the Swiftboat controversy. In just a moment I'll speak live with Bush/Cheney chairman Marc Racicot. I'll have much more on the story as well coming up including a debate on "WOLF BLITZER REPORTS." That starts 5:00 p.m., 2:00 Pacific. Plus I'll also live with the speaker of the House of Representatives, Dennis Hastert. We'll talk politics among other things at that time.

Checking on some of our headlines on our Friday edition of "Campaign News Daily." We have two new presidential polls to report from two separate showdown states. In Michigan, John Kerry holds a three-point edge over George W. Bush, 49 to 46 percent according to a survey by the American Research Group. ARG polled likely voters in New Mexico as well in a head-to-head match up there, Kerry leads with, get this, 10 points, 52 percent to 42 percent.

In the Pacific northwest about 150,000 people are expected to attend this weekend's Seattle hemp fest in support of legalizing marijuana. Organizers tell the "Boston Globe" they're encouraging supporters to back John Kerry for president citing Bush's tough stand against medical marijuana and other issues. Kerry camp volunteers are expected to staff a booth at the event along with voter registration groups like the League of Women Voters.

Democrats here in Washington today kicked off what they're calling the "America Can Do Better" bus tour. Senator Tom Harkin was among those announcing the 15-city tour which starts Monday and ends in New York City on the eve of the Republican convention. The bus will make stops in several battleground states where national and local party leaders will speak out on behalf of the Kerry-Edwards ticket.

Another anti-Kerry ad featuring fellow Vietnam vets. Up next, I'll speak with Bush campaign chairman Marc Racicot about the race for the White House and the latest back-and-forth over third party ads.

And assessing the balance of power on Capitol Hill. Stu Rothenberg updates us on the battle for control of the U.S. Senate.

And later, lots of sightseeing and low cost prescription drugs. How Britain plays a role in the political play of the week.

(COMMERCIAL BREAK)

BLITZER: Today's release of another anti-John Kerry ad from the group Swiftboat Veterans For Truth has renewed the controversy over attack ads. Kerry accuses President Bush of allowing so-called front groups to do his dirty work, that's a direct quote, while he remains silent. Joining us now from Arlington, Virginia, to answer John Kerry's charge, Governor Marc Racicot, the former governor of Montana, the current chairman of the Bush-Cheney campaign. First of all, Governor, thanks for joining us.

What is your connection, the Bush-Cheney campaign, with this group Swiftboat Veterans For Truth?

MARC RACICOT, BUSH-CHENEY CAMPAIGN CHAIRMAN: Absolutely nothing, nada (ph), no connection. There's no connection of any kind whatsoever.

BLITZER: All right so you're saying flatly that no one from the Bush-Cheney campaign has spoken or done anything to support the release of these ads, encouraged some of these big Texas contributors who are providing hundreds of thousands of dollars to get these ads on the air?

RACICOT: I don't know how many times we have to say it, there is no connection between the Bush campaign and these ads or that group, absolutely none. It would be a crime, as you pointed out in your previous segment, to coordinate that kind of an effort. It would be a federal crime. So quite obviously, it's a very serious matter.

BLITZER: What about this suggestion and you heard Tad Devine make it earlier from the Kerry campaign that Karl Rove, the president's top political strategist has a longstanding relationship with this Texas millionaire, Bob Perry who is providing a big chunk of the money for these ads.

RACICOT: Well, I think that they've come completely unhinged. Senator Kerry -- Tad, although I've certainly had time to grow to like him on occasion, he looks to me to be wild-eyed making accusations that have absolutely no basis in fact at all. And quite frankly it's incredibly irresponsible for those kinds of allegations to be made by both Senator Kerry and the members of his campaign. The kind of speculation, the kind of things that they're doing and suggesting expressly as well as by innuendo are completely out of bounds.

BLITZER: Well, what they're clearly suggesting is while there may not necessarily be a smoking gun, there's a wink and a nod, there's a lot of informal alliances, if you will, between those supporting these ads and either the White House or the Bush-Cheney campaign.

RACICOT: Well, as you pointed out, Wolf, although you didn't supply some of the details, there has been in excess of $60 million spent by 527 groups against the president trying to defeat the president. Known Democratic contributors. And as you asked Mr. Devine, does that mean that each of them should be indicted because they're known contributors? Because they support Senator Kerry?

We've never made that allegation. What we've said is, what the president has said is, Senator Kerry, why don't we join together here and make certain that all of these 527 ads are eliminated from the process, these unregulated soft dollar ads. And you know what, Senator Kerry hasn't had one word to say about $60 million being spent (UNINTELLIGIBLE) attacking the president for everything from condoning torture to poisoning pregnant women. And of course we still want to proceed in that direction responsibly to remove that kind of third party advertising from this campaign.

BLITZER: Senator John McCain who himself was a P.O.W. in Vietnam has specifically said these ads, these Swiftboat Veterans For Truth ads are dishonorable, dishonest and he has asked the president to disassociate himself from that, to repudiate these specific ads. Why won't the president do that?

RACICOT: The president has disassociated himself from all 527 ads... BLITZER: I know that but why won't he specifically say that these ads are scurrilous?

RACICOT: Wolf, the answer to the question is look, all of the 527 ads that are being run, this president has called for a halt to. He's asked Senator Kerry to join in that effort. Senator Kerry has declined to do so. And that's the approach that should be taken. All of these ads should be eliminated from the process. That's what we have taken as our position from the very beginning. We even suggested that to the FEC who yesterday finally agreed but unfortunately their rules don't apply during this election process.

BLITZER: But if the president believes John Kerry's service in Vietnam was noble and he has said that, right?

RACICOT: The president has always said he has no reason to say anything other than Senator Kerry's service to this country was honorable.

BLITZER: All right. So why won't he take the next step and say these ads are not honorable?

RACICOT: Wolf, he has said that about all 527 ads are inappropriate. Interestingly Senator Kerry, the other day, everyone reports it as having condemned an ad by one of these groups that have all of these Democratic contributors. He didn't condemn the ad. He said it was inappropriate and then two hours later, one of his main surrogates General Wesley Clark was out parroting the message of the ad.

So let's make certain that the facts are straight here and that people understand precisely the lay of the land.

BLITZER: But what would be so hard for the president to simply say what John McCain has said since the president's already on record as saying that John Kerry's service was noble.

RACICOT: He has said that John Kerry's service was honorable. There's no question about that. The president's service was honorable. We all served in a different fashion during that period of time, some of us were in the Guard, some of us were in active duty, some of us were assigned to Vietnam, some of us weren't. The fact of the matter is the only campaign that's ever called anybody's service into question is John Kerry's campaign.

BLITZER: You know, a lot of people are saying the president won't take that next step and say what John McCain wants him to say, what Chris Shays, a Republican congressman from Connecticut wants him to say, I interviewed him yesterday, because the Republicans, the Bush-Cheney campaign in particular believes these ads are in fact working.

RACICOT: Well, we believe that it's important to focus on his record, on his Senate record and upon all those things that have to do with his future capacity to be a leader, on why he voted for force in Iraq and then months later voted against appropriations to fund the efforts in Iraq. Those are legitimate areas of inquiry. We just don't believe that we ought to focus on the distant past when we don't think that it has a bearing on his present day capacity to lead this nation. There's more than enough evidence to suggest that his lack of conviction and unsteady hand on the ship of state would not be in the best interests of the American people.

BLITZER: All right. Governor Marc Racicot, we have to leave it right there. Thanks for spending a few moments for us.

RACICOT: Thank you, Wolf.

BLITZER: Republicans have a slim majority in the U.S. Senate but some races clearly tightening right now. Up next, we'll take a closer look toward November. Our political analyst Stu Rothenberg will join us to assess the battle for Senate control. It could be a surprise.

(COMMERCIAL BREAK)

BLITZER: Welcome back. The upcoming election could change the face of Washington and not just because of the presidential race. Republicans have an edge in the U.S. Senate but only slightly. There are 51 Republican senators in that chamber, 48 Democrats, one Independent. The balance of power in the Senate could tip either way, depending on what happens this November. CNN political analyst Stuart Rothenberg joins us now to help sort through what might happen.

It's still very possible the Democrats could get the majority in the Senate or the Republicans could hold on.

STUART ROTHENBERG, CNN POLITICAL ANALYST: That's right. You're absolutely right, Wolf. The Senate is broadly in play, there are enough seats in play, where if the Democrats can cherry pick a handful of Republican seats, hold their own open seats, that's crucial, they have a chance of getting a 50. But I have to tell you, Wolf, that it's a lot easier to see the path for the Republicans holding their majority than it is for the Democrats taking over the Senate.

BLITZER: Several of the swing states have had primary elections, some outcomes that have been relatively good for the Republicans. How does that play out?

ROTHENBERG: I think it's really important. At least three states have had primaries, Republican primaries, where the Republicans appear to have gotten a strong candidate. Initially in South Carolina when Jim DeMint won a crowded primary, he's taking on Inez Tenenbaum. DeMint is an appealing candidate. I think he appears to be ahead in polls both public and private.

The primary result was important in Oklahoma, Tom Coburn won a three-way Republican primary. As it turns out, I believe he's the most formidable Republican opponent for Brad Carson, the moderate Democrat who was very well positioned but maybe not against Coburn.

And in Colorado, a very ideological Republican primary produced Peter Coors who is widely regarded as having broader appeal than former congressman Bob Schaffer. BLITZER: In Illinois, it's almost certain the Democrats will pick up that seat. Is that right?

ROTHENBERG: I would drop the "almost." Yes, it is certain. If you're interested for entertainment values and looking at Alan Keyes and Barack Obama fine but in terms of a competitive race, it isn't one.

BLITZER: What about Georgia?

ROTHENBERG: Same thing but on the other side. This is the offsetting race where Republican Johnny Isakson and the congressman is now an overwhelming favorite against Denise Majette, the Democratic congresswoman. Republicans are going to win the seat.

BLITZER: So what's your bottom line as far as some of the surprises that we might -- that theoretically are out there? South Carolina, you mentioned for example. Is Inez Tenenbaum a realistic possibility?

ROTHENBERG: I think she's a very good candidate, she's running a good campaign, she's attractive, personable, and energetic. Her problem is it's a very Republican state.

It seems to me that if the Democrats are going to put this together they're going to have to have wins in Alaska and Colorado knocking off Lisa Murkowski and winning Ben Nighthorse Campbell open seat in Colorado and they're going to have to hold all their seats. That's Tom Daschle, the Florida open, the North Carolina open and the Louisiana open. That is a tough task. It is doable, it would be particularly doable if somehow they could make the Pennsylvania race competitive. That's Arlen Specter. Democrats are talking the race up now but it's still uphill for now.

BLITZER: Will the presidential balloting have a direct impact, do you believe, on some of these close Senate races?

ROTHENBERG: That's a big question, mark. And one state possibly, Pennsylvania, that's part of the reason we're watching Specter. The southeast portion of the state, the Philadelphia suburbs is an area that used to be Republican, moving Democratic, upscale, might go Joe Hoeffle. If so, that would threaten Arlen Specter. But otherwise, a lot of these states will go for Bush. Tom Daschle is going to have to fight a Bush wave. And Murkowski, Alaska's going to go for Bush. The questions are really Pennsylvania, Colorado an open seat where John Kerry has put some focus and of course North Carolina and Florida in the southeast, where Kerry has, you know, a chance, certainly in North Carolina and a very good chance in Florida.

BLITZER: All right, the balance of power in the Senate. Clearly very much hanging up there. Thanks very much.

Defining the government can be risky business for an elected official. Up next, one state governor takes a stand against Washington and brings home the political play of the week.

(COMMERCIAL BREAK)

BLITZER: An elected official takes the stand on an issue important to millions of people but will it pay off politically? Our Bill Schneider is with me now for more on that -- Bill.

SCHNEIDER: You know, defying the federal government is certainly risky for a politician but if it's the right cause, it can make you look like a hero and even get you the political play of the week.

(BEGIN VIDEOTAPE)

SCHNEIDER (voice-over): This week, Illinois Democratic Governor Rod Blagojevich took on the feds.

GOV. ROD BLAGOJEVICH (D), ILLINOIS: Unfortunately, so far, the federal government has failed to act. So it's time that we do.

SCHNEIDER: Current law bans Americans from purchasing prescription drugs from other countries. Where because of government price controls, the cost is substantially lower. In May, Governor Blagojevich dispatched a delegation to Europe to investigate their prescription drug markets. This week, he announced a new program.

BLAGOJEVICH: The state of Illinois will create a website, the first of its kind in the nation that provides access to prescription drugs from Canada and England and Scotland and Ireland. We are forming relationships with specific pharmacies and wholesalers in each country that will offer lower priced prescription drugs to the people of Illinois.

SCHNEIDER: The White House says it's concerned about consumer safety.

SCOTT MCCLELLAN, WHITE HOUSE PRESS SECRETARY: Right now, we cannot assure the safety of these drugs that would be imported into the United States as a safety matter.

SCHNEIDER: The governor's response?

BLAGOJEVICH: We are talking about the exact same medicines made by the exact same companies.

SCHNEIDER: Polls show the prescription drug programs seniors really want is the ability to buy cheaper drugs from other countries. Someone in the White House is getting that message.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: There's a lot of pressure in Congress for importation. And so I think it makes sense for us to make sure that we can do so in a safe way. If it's safe, then it makes sense.

SCHNEIDER: It certainly makes political sense.

KERRY: Just the other day, the president began to waiver on this. Do you think he's reading the polls?

SCHNEIDER: Or do you think he's paying attention to Governor Blagojevich's political play of the week?

(END VIDEOTAPE)

SCHNEIDER: Prescription drugs are the only legal item American consumers are not allowed to import. Now, the administration says free trade is less important than protecting consumer safety. Critics say it's all about protecting drug company profits.

BLITZER: I suspect that debate will continue. Bill Schneider with the political play of the week. Thanks very much.

And that's it for today's INSIDE POLITICS. I'm Wolf Blitzer in Washington. I'll be back in a half an hour on "WOLF BLITZER REPORTS." "CROSSFIRE" starts right now.

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


Aired August 20, 2004 - 15:30   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(BEGIN VIDEOTAPE)
SEN. JOHN KERRY (D-MA), PRESIDENTIAL CANDIDATE: They had personally raped, cut off ears, cut off heads...

UNIDENTIFIED MALE: The accusations that John Kerry made against the veterans who served in Vietnam was just devastating.

ANNOUNCER: A new salvo in the fight over John Kerry's Vietnam War record.

UNIDENTIFIED MALE: As a member of the Intelligence Committee, Senator Kerry was absent for 76 percent of the committee's hearings.

ANNOUNCER: A serious charge. Is it true? Releasing the records to settle this matter may not be so easy.

There's more than just the White House up for grabs this November. Can the Democrats retake the Senate from the Republicans? We'll take a closer look at the battle for Congress.

(END VIDEOTAPE)

ANNOUNCER: Now, live from Washington, JUDY WOODRUFF'S INSIDE POLITICS.

WOLF BLITZER, HOST: Thanks very much for joining us. I'm Wolf Blitzer. Judy is off today.

Veterans on the attack against John Kerry are making it clear once again today they're prepared to fight on despite the senator's personal attempt to discredit them as a front for President Bush. The group called Swift Boat Veterans for Truth today unveiled a brand-new ad. At the same time, a new poll offers the first measure of how the public is responding to the controversy.

(BEGIN VIDEOTAPE)

KERRY: They have personally raped, cut off ears, cut off heads...

UNIDENTIFIED MALE: The accusations that John Kerry made against the veterans who served in Vietnam was just devastating.

KERRY: ... randomly shot at civilians...

UNIDENTIFIED MALE: And it hurt me more than any physical wounds I had.

BLITZER (voice-over): The new ad by the so-called Swift Boat Veterans for Truth gets to the heart of their anger at John Kerry: his 1971 Senate testimony on alleged U.S. war crimes in Vietnam. Veterans who are now critical of Kerry make no bones about the fact that they were outraged by his anti-war activities after returning from Vietnam.

UNIDENTIFIED MALE: He dishonored his country and, more importantly, the people he served with. He just sold them out.

BLITZER: The Kerry campaign is condemning the new ad saying, "This Republican front group for Bush is out of credibility after being caught lie after lie, day after day."

UNIDENTIFIED MALE: You are aware you've been one of the strongest critics of this war for the longest time.

BLITZER: The does not ad include Kerry telling senators that the war crimes charges he outlined were based on the testimony of over 150 Vietnam veterans.

KERRY: Of course, this group isn't interested in the truth. They're not telling the truth.

BLITZER: A day after Kerry personally responded to the Swift Boat Veterans for Truth, he did not discuss the controversy, focusing instead on domestic issues. But a new poll may help explain why he decided to fight back. The Annenberg Survey found 57 percent of Americans say they have seen the original Swift Boat ad or heard talk about it.

UNIDENTIFIED MALE: John Kerry lied to get his Bronze Star. I know. I was there. I saw what happened.

BLITZER: Those who are aware of the ad are split on whether it's believable. Of all those surveyed, 59 percent say they think Kerry did earn all of his war medals. Twenty-one percent say he did not earn them. Twenty percent are unsure.

KERRY: They're funded by hundreds of thousands of dollars from a Republican contributor out of Texas.

BLITZER: The Kerry camp continues to press its charge that the Swift Boat Veterans for Truth is a front for the Bush campaign. "The New York Times" today reports what it describes as a web of connections between the group behind the ad and the Bush family: high- profile Texas political figures and the president's top political strategist, Karl Rove.

Apparently, picking up on that, the Kerry camp today charged, "Karl Rove's attack squad of convincing the Swift Boat Veterans to lie." The Swift Boat group denies any direct contact with the RNC, the Bush White House or any Republican group.

LARRY THURLOW, VIETNAM VET: I've had absolutely no contact with any of them, nor do I plan to, nor can they tell me not to take part in the Swift Boat group's campaign.

(END VIDEOTAPE)

BLITZER: And the Swift Boat Veterans for Truth say their new ad will air beginning Tuesday in three states. They've not yet chosen which those -- which of those states be included. They say they will have a budget of around $600,000 to pay for those ads.

The Bush White House says it is not involved with the Swift Boat ads in any way and suggests John Kerry is simply overreacting. CNN's Jill Dougherty is covering the president. She's joining us now live from Crawford, Texas.

What's the latest from there, Jill?

JILL DOUGHERTY, CNN CORRESPONDENT: Well, Wolf, you said overreacting, but what the operative phrase from the White House today was Senator Kerry is "losing his cool" over this issue. It came from Scott McClellan, who gave a briefing to reporters. And, actually, he was responding to a question from reporters about that "New York Times" story that alleges this web of connections between the people involved in the ads and the Bush family, Texas people, and Karl Rove.

So he immediately said, no, there is no connection, categorically, as the campaign says, between them. But then he went after Senator Kerry.

(BEGIN VIDEO CLIP)

SCOTT MCCLELLAN, WHITE HOUSE PRESS SECRETARY: We've already said we weren't involved in any way in these ads. We've made that clear.

I do think that Senator Kerry losing his cool should not be an excuse for him to lash out at the president with false and baseless attacks. I mean, where has the Kerry campaign been for the last year while more than $62 million in funding through these shadowy groups have been used to negatively attack the president?

(END VIDEO CLIP)

DOUGHERTY: So the presidential spokesman said that Senator Kerry has been noticeably silent, as he put it, on these attack ads, and said the campaign is actually fueling more of these ads. And then, as they've said before, Wolf, he said, look, we could end this today if Senator Kerry would join the president and say let's just stop all these ads.

BLITZER: Jill Dougherty reporting for us from Crawford, Texas. Thanks, Jill, very much.

Let's go now to the John Kerry campaign. I'm joined live by campaign senior strategist Tad Devine.

Tad, thanks very much for joining us. Where's the hard evidence directly linking the Bush White House or the Bush-Cheney campaign to these ads as alleged yesterday by John Kerry? TAD DEVINE, SR. STRATEGIST KERRY CAMPAIGN: Well, Wolf, it's in "The New York Times" today. There's a big chart. You know, you can take a look at it. OK?

The connections, the web of connections between this effort and the campaign are obvious for anyone to see. And, by the way, Wolf, this is part of pattern.

This is what George Bush does. He did it precisely against John McCain. They have others front for them, do their dirty work for them. They stand there and do nothing. And for the president of the United States to stand there and say nothing about this is reprehensible.

BLITZER: Well, I read the entire "New York Times" article and our viewers did. In fact, I spoke earlier today with one of the reporters who wrote the article. They don't have any hard evidence backing it up.

They have a web of connections, as you say, but there's nothing specific...

DEVINE: Sure.

BLITZER: ... because if there were, they would be breaking the law. There's a -- there's a campaign fund-raising violation that would clearly be violated. Give me the specific, name names. Who is doing this?

DEVINE: Wolf, it's obvious for everyone to see. These are Texas fund-raisers, it's precisely what happened to John McCain four years ago. They've got a web of connections between them and the Bush campaign.

They take these people. Once removed from the campaign -- and obviously they're doing it deliberately that way. They do not want the legal connections between the campaign, they're once removed from the campaign. Every time we look closer and closer at this, this is what we discover...

BLITZER: All right.

DEVINE: ... the connections between the campaign and the lies and distortions at the heart of the Swift Boat Veterans.

BLITZER: All right. So let me repeat the question. Name some names, the connections between the campaign or the White House, on the one hand, and these Swift Boat Veterans, those who are funding these ads on the other. Go ahead. Connect the dots.

DEVINE: Well, Wolf -- Wolf, I don't know how it can be anymore explicitly clear than it is in the chart in today's "New York Times." I mean, it's laid out person by person, the connections between Karl Rove and the major fund-raisers, the connection between the people making these ads, the long history of connections between them and George Bush and president -- the previous President Bush, the president's father.

These connections go back years and years. It's the same tangled web of people who tried to do this to John McCain four years ago. But let me tell you something. It's not going to happen to John Kerry.

John Kerry will fight back. He's -- and he's going to challenge the president as John McCain challenged the president, to stand up, to denounce these ads. And every day that goes buy that the president fails to denounce these ads just demonstrates his complicity in these efforts.

BLITZER: All right. So I've heard one name, Karl Rove. Are you saying Karl Rove coordinated with the Swift Boat for Veterans -- that the Swift Boat Veterans for Truth coordinated this ad campaign? Is that the allegation?

DEVINE: Well, Wolf, to demonstrate this, we'd have to go to court, we'd have to depose people, we'd have to put them under oath, we'd have to subject them to all the process of a legal examination. I think the facts are obvious here. It's for everyone to see.

A bunch of rich guys from Texas with long connections to the Bush campaign come out and try to destroy a veteran of the Vietnam War. It happened twice. They did it once in 2000; they're trying to do it again in 2004. The only difference is it's not going to succeed this time. That's the big difference.

BLITZER: Let me throw it this way to you.

DEVINE: Sure.

BLITZER: There are a bunch of rich Democrats out there, a bunch of active Democratic activists out there who are involved in all sorts of 527 independent ad campaigns smearing the president of the United States and the vice president right now. Because they have a long history working with other Democrats, with Kerry supporters and strategists, does it make them in violation of the law as well?

DEVINE: Wolf, when John McCain challenged Senator Kerry days ago to denounce an ad attacking the president's lack of service in the National Guard, within hours Senator Kerry spoke up publicly and denounced the ad. It's so different from what this president is doing.

This president is attempting to put out this group do his dirty work for him, and that's because the president cannot talk about economy, health care, energy independence, or how he's going to defend the nation, particularly his failure in Iraq. This is a deliberate effort on their part to distract the voters' attention away from the failures of George Bush's administration.

BLITZER: Are you going to file a complaint with the Federal Election Commission?

DEVINE: Wolf, listen, they're trying to tie us up in legal process, trying to distract this campaign and the American people from the real issues. I'll tell you what we're going to do.

We're going to continue to talk about John Edwards and John Kerry's plan to make America stronger at home and respected in the world. We're going to do that every day. And at times we will hold them up to the light of day. And when they are exposed, as they have been recently in the mainstream press, they will see they are liars and bigots. And the more of that scrutiny on this group the better for us.

BLITZER: Why did John Kerry wait so long to respond this Swift Boat Veterans for Truth?

DEVINE: Well, Wolf, because, obviously, when we respond it's going to be launched on to a broad national stage. And that's a tactical decision you have to make in campaigns. But the lies had built up to such an extent we decided to talk about it.

He felt very strongly himself that this needed to be answered. He wrote the answer himself, he delivered it powerfully in Boston the other day.

Now, he's not going to spend all of his time talking about this because he is determined to change the course of this nation. But we will point, and I think rightfully so, that this president, George W. Bush, is behind this attack, is complicit in it, and is failing to live up to his responsibility as commander-in-chief to stand up and defend a decorated war veteran, John Kerry.

BLITZER: Yesterday, the Democratic nominee challenged President Bush and said if he wants to have a debate over their service during the Vietnam War, he had a very strong challenge to him. I want you to listen to what John Kerry said -- well, actually, we don't have that sound bite.

DEVINE: Just bring it on.

BLITZER: But he just basically said -- he said, "Bring it on." What is the point? What was John Kerry saying about the president of the United States and his service in the Texas Air National Guard?

DEVINE: Well, Wolf, I think what he was saying was "our" service, and I believe who he was referring to was himself and the crewmates he served with. Everyone, Wolf, who has seen any of these episodes has offered first-person testimony to what happened.

People like John O'Neill, who wrote this book, weren't even there. People like his co-author, who's been exposed as an anti- Catholic, anti-Semitic bigot, weren't even in Vietnam. So John Kerry was talking -- when he said "our" service, he was referring to himself and his crewmates, not to the president.

BLITZER: But was he smearing the president because the president didn't volunteer to go to Vietnam?

DEVINE: No, he was not smearing the president. He was talking about "our" service, himself and his crewmates, the people who actually saw the heroism that resulted in John Kerry winning a Silver Star, a Bronze Star and three Purple Hearts. Those events happened.

And you know, Wolf, lies can be powerful. And these guys have demonstrated that. But the truth is even more powerful. And as the American people find out the truth, that these are distortion and lies about John Kerry, and that George Bush is behind it, the president will pay a heavy price.

BLITZER: Tad Devine from the Kerry campaign. Thanks very much for joining us.

DEVINE: Thank you.

BLITZER: And this note to our viewers. Later on this program we'll get some Republican reaction to the Swift Boat controversy. I'll speak with the Bush campaign chairman, the former governor, Marc Racicot.

The Kerry campaign is getting flak on more than one front today. Coming up, John Kerry's attendance record on the Senate Intelligence Committee. Should the records be released?

Plus, the Senate Intelligence Committee chairman on the records flap (ph), and his disagreements with the president and some other fellow Republicans.

And later, can playing the hero merit the "Political Play of the Week?"

With 74 days until the election, this is INSIDE POLITICS, the place for campaign news.

(COMMERCIAL BREAK)

BLITZER: Welcome back. A new Bush campaign ad takes direct aim at John Kerry's attendance record as a member of the Senate Intelligence Committee. Our congressional correspondent, Ed Henry, reports on the debate, over-attendance, and explains how this issue could entangle members of both parties.

(BEGIN VIDEOTAPE)

ED HENRY, CNN CONGRESSIONAL CORRESPONDENT (voice-over): Senators Kerry and Edwards, who have touted their service on the Intelligence Committee, are under fire for skipping many of the panel's public sessions.

UNIDENTIFIED MALE: Senator Kerry was absent for 76 percent of the committee's hearings.

HENRY: Democrats say that number is skewed. It does not include the hundreds of private and classified meetings held during Kerry's tenure on the panel from 1993 through 2000. So Republicans have called Kerry's bluff, demanding that he and Edwards ask the committee to release the classified portion of their attendance figures to see how many of those sessions they attended. SEN. PAT ROBERTS (R), INTELLIGENCE CHAIRMAN: All John Kerry has to do and all that John Edwards has to do is write us or pick up the phone and call me, say, "Hey Pat, hey Jay, hey Senator Rockefeller, hey Senator Roberts, please release my records, and not only the public records, but the closed records." And then the matter is over.

HENRY: Chairman Roberts said committee rules allow him and vice chair Jay Rockefeller to decide whether to release the records. But Democrats insist such a precedent-setting move would trigger a vote in the Intelligence Committee. That could be a slippery slope because senators in both parties routinely miss public hearings and private meetings.

Democrats privately warn they will push to release the attendance of every senator during the time Kerry and Edwards served on the committee. Democrats insist the Republicans would never go for that because both parties would be embarrassed. Bush campaign officials say Democrats are committing a smoke screen and Kerry and Edwards should be held to a higher standard than other senators because they are running for higher office.

ROBERTS: You have both candidates saying this: because of our intelligence background on the committee, more especially John Edwards, who has indicated it wouldn't have take us three years to make the changes after 9/11 that we need to make, well, Senator Edwards made a decision to run for vice president.

HENRY: By that standard, Democrats say Vice President Cheney's tenure on the House Intelligence Committee is fair game. They say Cheney attend only one of the seven public hearings the committee held from 1985 through 1989. Cheney's tenure was before 9/11, but so was Kerry's.

REP. JANE HARMAN (D), INTELLIGENCE VICE CHAIR: I don't believe that Senator Kerry has been a member of the Senate Intelligence Committee since 2000. And I think the ad is somewhat misleading.

It implies that he -- he has been and that he was AWOL. If he missed some hearings in the '90s, that's a fair issue. But that does not apply to post-9/11.

(END VIDEOTAPE)

HENRY: Wolf, I just got off the phone with the Bush-Cheney campaign. They insist that the Democrats' numbers are wrong, that Vice President Cheney only missed one hearing in the 1980s of the House Intelligence Committee.

They say this has been concocted out of (UNINTELLIGIBLE). Bush- Cheney spokesman Steve Schmidt says that the Democrats are on the run because John Kerry is on the defensive about this. They say that the campaign is just trying to have a distraction here.

And what Steve Schmidt is saying is that, bottom line, John Kerry has to make a phone call to Chairman Pat Roberts and say, "Turn those records over, release them." But I can tell you, I've been talking to a lot of people close to John Kerry. They say he has no intention of making that phone call -- Wolf.

BLITZER: Now, isn't it a fundamental fact -- and you and I have covered Capitol Hill for a long time -- that if they start going down this slippery slope about absenteeism, which senators or members of the House actually go to committee hearings, public ones or private ones, there's going to be a lot of embarrassment on the Republican and Democratic side?

HENRY: Absolutely, because senators are on three, four committees, sometimes. They're juggling meetings, all their schedules are busy. They're fund-raising, they're doing a lot of things in addition to official business. But I can tell you, the Republicans feel very confident here that their numbers are going to be better, and they also feel that they do have the Kerry campaign on the run.

When you talk to political analysts out there, they say that John Kerry is trying to make intelligence a key part of his campaign. This puts him on the defensive. But they also say that if he's not showing up for these hearings, that's going to also look like since he's not releasing the records he's hiding something -- Wolf.

BLITZER: I guess one of the down sides of having two sitting senators on the same ticket, a lot of voting records, a lot of attendance records that can be reviewed.

HENRY: Absolutely.

BLITZER: Ed Henry, thanks very much for that good report.

And hopefully here on INSIDE POLITICS today we'll speak with the chairman of the Senate Intelligence Committee, Pat Roberts of Kansas. We expect to speak with him at some point, get his assessment on what's going on.

Natural disasters can put a big, big wrinkle in planning for a major election. Coming up, how Florida's election machine is coping with the aftermath of Hurricane Charley.

(COMMERCIAL BREAK)

BLITZER: Yet another response today to veterans' attacks on John Kerry. This time in a new ad by the Democratic National Committee.

The spot features retired General and former Air Force Chief of Staff Tony McPeak. After endorsing George W. Bush four years ago, McPeak says he's supporting Kerry this year because he has -- and I'm quoting now -- "the strength and common sense we need in a commander- in-chief." The ad is part of a $7 million ad buy in battleground states.

Florida Governor Jeb Bush has declared an elections emergency in counties hit hard last week by Hurricane Charley. The governor's declaration allows local officials to delay early voting and it gives them more time to hire and train poll workers.

Florida's primary is less than two weeks away, on August 31st. Bush and the secretary of state have indicated the primary will be held as scheduled, even if people have to vote inside tents and generators are used for power.

More in our next half-hour from Florida on Charley's aftermath. But coming up right after the break, John Kerry touches down for a first-hand look at the Hurricane's handiwork.

Later, the Senate scramble. We'll take a closer look at this November's key races.

(COMMERCIAL BREAK)

(BEGIN VIDEOTAPE)

ANNOUNCER: A new blast at John Kerry's Vietnam War records.

KERRY: Crimes committed on day-to-day basis...

UNIDENTIFIED MALE: He betrayed us in the past. How could we be loyal to him now?

ANNOUNCER: Are the attacks hurting Kerry's bid for the White House?

The fight for the showdown states. We've got new polls in two crucial states that could decide the election.

It's Friday, and that means the "Play of the Week." Stick around. Bill Schneider will reveal the winner.

(END VIDEOTAPE)

ANNOUNCER: Now, live from Washington, JUDY WOODRUFF'S INSIDE POLITICS.

BLITZER: Welcome back. I'm Wolf Blitzer, sitting in today for Judy.

John Kerry is in Florida this hour, touring damage from Hurricane Charley. At the same time, his campaign continues to do damage control over ads attacking his war record in Vietnam and his antiwar activities after returning home. CNN's Dan Lothian is traveling with John Kerry.

(BEGIN VIDEOTAPE)

DAN LOTHIAN, CNN CORRESPONDENT (voice-over): Even as the anti- Kerry group Swift Boat Veterans for Truth prepare to roll out another ad critical of the senator's Vietnam War rhetoric...

UNIDENTIFIED MALE: He betrayed us in the past. How could we be loyal to him now?

LOTHIAN: ... Kerry tried to refocus his campaign on domestic issues important to voters.

UNIDENTIFIED MALE: I was furloughed in December of 2002, and that's when I started looking for retraining.

LOTHIAN: Meeting with laid-off workers being retrained at a Charlotte, North Carolina, community college...

UNIDENTIFIED MALE: John Kerry!

LOTHIAN: ... and later, with more than 700 others gathered at the school, Kerry touted his economic plan which he says will restore prosperity to every American.

KERRY: We're just going to go back to where we were with Bill Clinton, when people got rich and the country did well.

LOTHIAN: His plan? To end tax breaks for companies that ship jobs overseas and to enforce trade agreements. But recognizing the forces of economic trends, Kerry told the crowd he won't promise what he can't deliver.

KERRY: One thing I know people all across this country want more than anything else is leadership that looks them in the eye and tells the truth.

(END VIDEOTAPE)

LOTHIAN: The Kerry campaign says that the senator will continue to vigorously defend his record. Now, as for the new ads, campaign aides say that you can just take a look at the credibility that's being lost by the groups behind the ads, they say they've just been telling, quote, "lie after lie day after day."

Now Senator Kerry as you mentioned, Wolf, is here in Florida touring the devastated areas hit by Hurricane Charley last week. The campaign was expected to come here on a campaign stop just before the hurricane slammed into Florida and decided to put off that campaign trip here feeling that it would be a distraction and decided to come now at the invitation of Senator Bill Nelson -- Wolf.

BLITZER: And, Dan, on this day after he went on the offensive on the Swiftboat Veterans For Truth he made no mention whatsoever of this controversy today?

LOTHIAN: That is correct, Wolf. No mention of that. You're correct. Yesterday, he did come out aggressively, tried to defend his war record. Today, no mention of that, instead, tried to stay on message. And as I mentioned, his campaign saying that he will continue in the future to vigorously defend his war record -- Wolf.

BLITZER: CNN's Dan Lothian covering John Kerry today in Florida. Thanks, Dan, very much.

We're getting somewhat of a better idea now of how the Swiftboat controversy may be affecting the White House thanks to some brand new poll numbers. Let's bring in our senior political analyst Bill Schneider. Bill, what are the poll numbers showing right now, as far as whether they believe the Swiftboat Veterans as part of these ads or they believe John Kerry? WILLIAM SCHNEIDER, CNN SR. POLITICAL ANALYST: Well, the Annenberg Center of the University of Pennsylvania, the Annenberg School did a poll in which asked people who had seen or heard about the ad, that's a majority of Americans, because the ad has been shown and talked about so much on radio and television, do you find the charges believable? Do you find the ad believable?

The answer is they're split down the middle. About half, 46 percent say they find the ad very or somewhat believable and about half, 49 percent say they find it very or somewhat unbelievable. As you'd expect, Republicans say they find it believable, Democrats don't but Independents who are the people who come at this without any predispositions are split right down the middle.

BLITZER: So how is it impacting the horse race, if it is at all?

SCHNEIDER: Well, here's what we know. There is a CBS News poll just out which shows there has been a slight shift since the period right after the Democratic convention. Immediately after the convention the race stood at 48 percent for John Kerry, 43 percent for Bush. Now, the race is virtually a tie. 46 Kerry, 45 Bush.

What that indicates is about a two-point shift, not very big but a two-point shift among voters from Kerry to Bush. Does this have anything to do with the ads? Well, what they found in that CBS News poll is that the biggest shift came among veterans. They're only 16 percent of the voters, so they're not a big group. But take a look. After the Democratic convention, veterans were tied, 46 Kerry, 46 Bush. Now, veterans are 55 percent for Bush, 37 percent for Kerry. Notice that there is a nine-point shift among veterans from Kerry to Bush. The suggestion is, at least the possibility is there that the Swiftboat ad angered a lot of veterans.

BLITZER: I thought after the Michael Dukakis blunder of '88, when he refused to respond to the attacks against him and waited and waited and waited, the Democrats had learned from that experience, which raises a question, why did John Kerry wait so long, more than a week, two weeks to actually respond to these attacks?

SCHNEIDER: He is responding right now and he's responding forcefully and in person. This CBS News poll was taken just before we heard from Senator Kerry and indicated damage has been done. I think probably, this is only a guess but Kerry waited to see if the ad was doing any damage, if anyone found it believable. He found that there was some damage there and then he spoke out, learning the lesson from Michael Dukakis not to let these charges lie there.

BLITZER: I guess you can't wait very long. Whenever you're attacked you have to attack right back. Bill Schneider will be back later on INSIDE POLITICS with his political play of the week. Can't wait to hear what it is. Thanks very much, Bill, for that.

And we'll also get the Republican take on the Swiftboat controversy. In just a moment I'll speak live with Bush/Cheney chairman Marc Racicot. I'll have much more on the story as well coming up including a debate on "WOLF BLITZER REPORTS." That starts 5:00 p.m., 2:00 Pacific. Plus I'll also live with the speaker of the House of Representatives, Dennis Hastert. We'll talk politics among other things at that time.

Checking on some of our headlines on our Friday edition of "Campaign News Daily." We have two new presidential polls to report from two separate showdown states. In Michigan, John Kerry holds a three-point edge over George W. Bush, 49 to 46 percent according to a survey by the American Research Group. ARG polled likely voters in New Mexico as well in a head-to-head match up there, Kerry leads with, get this, 10 points, 52 percent to 42 percent.

In the Pacific northwest about 150,000 people are expected to attend this weekend's Seattle hemp fest in support of legalizing marijuana. Organizers tell the "Boston Globe" they're encouraging supporters to back John Kerry for president citing Bush's tough stand against medical marijuana and other issues. Kerry camp volunteers are expected to staff a booth at the event along with voter registration groups like the League of Women Voters.

Democrats here in Washington today kicked off what they're calling the "America Can Do Better" bus tour. Senator Tom Harkin was among those announcing the 15-city tour which starts Monday and ends in New York City on the eve of the Republican convention. The bus will make stops in several battleground states where national and local party leaders will speak out on behalf of the Kerry-Edwards ticket.

Another anti-Kerry ad featuring fellow Vietnam vets. Up next, I'll speak with Bush campaign chairman Marc Racicot about the race for the White House and the latest back-and-forth over third party ads.

And assessing the balance of power on Capitol Hill. Stu Rothenberg updates us on the battle for control of the U.S. Senate.

And later, lots of sightseeing and low cost prescription drugs. How Britain plays a role in the political play of the week.

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BLITZER: Today's release of another anti-John Kerry ad from the group Swiftboat Veterans For Truth has renewed the controversy over attack ads. Kerry accuses President Bush of allowing so-called front groups to do his dirty work, that's a direct quote, while he remains silent. Joining us now from Arlington, Virginia, to answer John Kerry's charge, Governor Marc Racicot, the former governor of Montana, the current chairman of the Bush-Cheney campaign. First of all, Governor, thanks for joining us.

What is your connection, the Bush-Cheney campaign, with this group Swiftboat Veterans For Truth?

MARC RACICOT, BUSH-CHENEY CAMPAIGN CHAIRMAN: Absolutely nothing, nada (ph), no connection. There's no connection of any kind whatsoever.

BLITZER: All right so you're saying flatly that no one from the Bush-Cheney campaign has spoken or done anything to support the release of these ads, encouraged some of these big Texas contributors who are providing hundreds of thousands of dollars to get these ads on the air?

RACICOT: I don't know how many times we have to say it, there is no connection between the Bush campaign and these ads or that group, absolutely none. It would be a crime, as you pointed out in your previous segment, to coordinate that kind of an effort. It would be a federal crime. So quite obviously, it's a very serious matter.

BLITZER: What about this suggestion and you heard Tad Devine make it earlier from the Kerry campaign that Karl Rove, the president's top political strategist has a longstanding relationship with this Texas millionaire, Bob Perry who is providing a big chunk of the money for these ads.

RACICOT: Well, I think that they've come completely unhinged. Senator Kerry -- Tad, although I've certainly had time to grow to like him on occasion, he looks to me to be wild-eyed making accusations that have absolutely no basis in fact at all. And quite frankly it's incredibly irresponsible for those kinds of allegations to be made by both Senator Kerry and the members of his campaign. The kind of speculation, the kind of things that they're doing and suggesting expressly as well as by innuendo are completely out of bounds.

BLITZER: Well, what they're clearly suggesting is while there may not necessarily be a smoking gun, there's a wink and a nod, there's a lot of informal alliances, if you will, between those supporting these ads and either the White House or the Bush-Cheney campaign.

RACICOT: Well, as you pointed out, Wolf, although you didn't supply some of the details, there has been in excess of $60 million spent by 527 groups against the president trying to defeat the president. Known Democratic contributors. And as you asked Mr. Devine, does that mean that each of them should be indicted because they're known contributors? Because they support Senator Kerry?

We've never made that allegation. What we've said is, what the president has said is, Senator Kerry, why don't we join together here and make certain that all of these 527 ads are eliminated from the process, these unregulated soft dollar ads. And you know what, Senator Kerry hasn't had one word to say about $60 million being spent (UNINTELLIGIBLE) attacking the president for everything from condoning torture to poisoning pregnant women. And of course we still want to proceed in that direction responsibly to remove that kind of third party advertising from this campaign.

BLITZER: Senator John McCain who himself was a P.O.W. in Vietnam has specifically said these ads, these Swiftboat Veterans For Truth ads are dishonorable, dishonest and he has asked the president to disassociate himself from that, to repudiate these specific ads. Why won't the president do that?

RACICOT: The president has disassociated himself from all 527 ads... BLITZER: I know that but why won't he specifically say that these ads are scurrilous?

RACICOT: Wolf, the answer to the question is look, all of the 527 ads that are being run, this president has called for a halt to. He's asked Senator Kerry to join in that effort. Senator Kerry has declined to do so. And that's the approach that should be taken. All of these ads should be eliminated from the process. That's what we have taken as our position from the very beginning. We even suggested that to the FEC who yesterday finally agreed but unfortunately their rules don't apply during this election process.

BLITZER: But if the president believes John Kerry's service in Vietnam was noble and he has said that, right?

RACICOT: The president has always said he has no reason to say anything other than Senator Kerry's service to this country was honorable.

BLITZER: All right. So why won't he take the next step and say these ads are not honorable?

RACICOT: Wolf, he has said that about all 527 ads are inappropriate. Interestingly Senator Kerry, the other day, everyone reports it as having condemned an ad by one of these groups that have all of these Democratic contributors. He didn't condemn the ad. He said it was inappropriate and then two hours later, one of his main surrogates General Wesley Clark was out parroting the message of the ad.

So let's make certain that the facts are straight here and that people understand precisely the lay of the land.

BLITZER: But what would be so hard for the president to simply say what John McCain has said since the president's already on record as saying that John Kerry's service was noble.

RACICOT: He has said that John Kerry's service was honorable. There's no question about that. The president's service was honorable. We all served in a different fashion during that period of time, some of us were in the Guard, some of us were in active duty, some of us were assigned to Vietnam, some of us weren't. The fact of the matter is the only campaign that's ever called anybody's service into question is John Kerry's campaign.

BLITZER: You know, a lot of people are saying the president won't take that next step and say what John McCain wants him to say, what Chris Shays, a Republican congressman from Connecticut wants him to say, I interviewed him yesterday, because the Republicans, the Bush-Cheney campaign in particular believes these ads are in fact working.

RACICOT: Well, we believe that it's important to focus on his record, on his Senate record and upon all those things that have to do with his future capacity to be a leader, on why he voted for force in Iraq and then months later voted against appropriations to fund the efforts in Iraq. Those are legitimate areas of inquiry. We just don't believe that we ought to focus on the distant past when we don't think that it has a bearing on his present day capacity to lead this nation. There's more than enough evidence to suggest that his lack of conviction and unsteady hand on the ship of state would not be in the best interests of the American people.

BLITZER: All right. Governor Marc Racicot, we have to leave it right there. Thanks for spending a few moments for us.

RACICOT: Thank you, Wolf.

BLITZER: Republicans have a slim majority in the U.S. Senate but some races clearly tightening right now. Up next, we'll take a closer look toward November. Our political analyst Stu Rothenberg will join us to assess the battle for Senate control. It could be a surprise.

(COMMERCIAL BREAK)

BLITZER: Welcome back. The upcoming election could change the face of Washington and not just because of the presidential race. Republicans have an edge in the U.S. Senate but only slightly. There are 51 Republican senators in that chamber, 48 Democrats, one Independent. The balance of power in the Senate could tip either way, depending on what happens this November. CNN political analyst Stuart Rothenberg joins us now to help sort through what might happen.

It's still very possible the Democrats could get the majority in the Senate or the Republicans could hold on.

STUART ROTHENBERG, CNN POLITICAL ANALYST: That's right. You're absolutely right, Wolf. The Senate is broadly in play, there are enough seats in play, where if the Democrats can cherry pick a handful of Republican seats, hold their own open seats, that's crucial, they have a chance of getting a 50. But I have to tell you, Wolf, that it's a lot easier to see the path for the Republicans holding their majority than it is for the Democrats taking over the Senate.

BLITZER: Several of the swing states have had primary elections, some outcomes that have been relatively good for the Republicans. How does that play out?

ROTHENBERG: I think it's really important. At least three states have had primaries, Republican primaries, where the Republicans appear to have gotten a strong candidate. Initially in South Carolina when Jim DeMint won a crowded primary, he's taking on Inez Tenenbaum. DeMint is an appealing candidate. I think he appears to be ahead in polls both public and private.

The primary result was important in Oklahoma, Tom Coburn won a three-way Republican primary. As it turns out, I believe he's the most formidable Republican opponent for Brad Carson, the moderate Democrat who was very well positioned but maybe not against Coburn.

And in Colorado, a very ideological Republican primary produced Peter Coors who is widely regarded as having broader appeal than former congressman Bob Schaffer. BLITZER: In Illinois, it's almost certain the Democrats will pick up that seat. Is that right?

ROTHENBERG: I would drop the "almost." Yes, it is certain. If you're interested for entertainment values and looking at Alan Keyes and Barack Obama fine but in terms of a competitive race, it isn't one.

BLITZER: What about Georgia?

ROTHENBERG: Same thing but on the other side. This is the offsetting race where Republican Johnny Isakson and the congressman is now an overwhelming favorite against Denise Majette, the Democratic congresswoman. Republicans are going to win the seat.

BLITZER: So what's your bottom line as far as some of the surprises that we might -- that theoretically are out there? South Carolina, you mentioned for example. Is Inez Tenenbaum a realistic possibility?

ROTHENBERG: I think she's a very good candidate, she's running a good campaign, she's attractive, personable, and energetic. Her problem is it's a very Republican state.

It seems to me that if the Democrats are going to put this together they're going to have to have wins in Alaska and Colorado knocking off Lisa Murkowski and winning Ben Nighthorse Campbell open seat in Colorado and they're going to have to hold all their seats. That's Tom Daschle, the Florida open, the North Carolina open and the Louisiana open. That is a tough task. It is doable, it would be particularly doable if somehow they could make the Pennsylvania race competitive. That's Arlen Specter. Democrats are talking the race up now but it's still uphill for now.

BLITZER: Will the presidential balloting have a direct impact, do you believe, on some of these close Senate races?

ROTHENBERG: That's a big question, mark. And one state possibly, Pennsylvania, that's part of the reason we're watching Specter. The southeast portion of the state, the Philadelphia suburbs is an area that used to be Republican, moving Democratic, upscale, might go Joe Hoeffle. If so, that would threaten Arlen Specter. But otherwise, a lot of these states will go for Bush. Tom Daschle is going to have to fight a Bush wave. And Murkowski, Alaska's going to go for Bush. The questions are really Pennsylvania, Colorado an open seat where John Kerry has put some focus and of course North Carolina and Florida in the southeast, where Kerry has, you know, a chance, certainly in North Carolina and a very good chance in Florida.

BLITZER: All right, the balance of power in the Senate. Clearly very much hanging up there. Thanks very much.

Defining the government can be risky business for an elected official. Up next, one state governor takes a stand against Washington and brings home the political play of the week.

(COMMERCIAL BREAK)

BLITZER: An elected official takes the stand on an issue important to millions of people but will it pay off politically? Our Bill Schneider is with me now for more on that -- Bill.

SCHNEIDER: You know, defying the federal government is certainly risky for a politician but if it's the right cause, it can make you look like a hero and even get you the political play of the week.

(BEGIN VIDEOTAPE)

SCHNEIDER (voice-over): This week, Illinois Democratic Governor Rod Blagojevich took on the feds.

GOV. ROD BLAGOJEVICH (D), ILLINOIS: Unfortunately, so far, the federal government has failed to act. So it's time that we do.

SCHNEIDER: Current law bans Americans from purchasing prescription drugs from other countries. Where because of government price controls, the cost is substantially lower. In May, Governor Blagojevich dispatched a delegation to Europe to investigate their prescription drug markets. This week, he announced a new program.

BLAGOJEVICH: The state of Illinois will create a website, the first of its kind in the nation that provides access to prescription drugs from Canada and England and Scotland and Ireland. We are forming relationships with specific pharmacies and wholesalers in each country that will offer lower priced prescription drugs to the people of Illinois.

SCHNEIDER: The White House says it's concerned about consumer safety.

SCOTT MCCLELLAN, WHITE HOUSE PRESS SECRETARY: Right now, we cannot assure the safety of these drugs that would be imported into the United States as a safety matter.

SCHNEIDER: The governor's response?

BLAGOJEVICH: We are talking about the exact same medicines made by the exact same companies.

SCHNEIDER: Polls show the prescription drug programs seniors really want is the ability to buy cheaper drugs from other countries. Someone in the White House is getting that message.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: There's a lot of pressure in Congress for importation. And so I think it makes sense for us to make sure that we can do so in a safe way. If it's safe, then it makes sense.

SCHNEIDER: It certainly makes political sense.

KERRY: Just the other day, the president began to waiver on this. Do you think he's reading the polls?

SCHNEIDER: Or do you think he's paying attention to Governor Blagojevich's political play of the week?

(END VIDEOTAPE)

SCHNEIDER: Prescription drugs are the only legal item American consumers are not allowed to import. Now, the administration says free trade is less important than protecting consumer safety. Critics say it's all about protecting drug company profits.

BLITZER: I suspect that debate will continue. Bill Schneider with the political play of the week. Thanks very much.

And that's it for today's INSIDE POLITICS. I'm Wolf Blitzer in Washington. I'll be back in a half an hour on "WOLF BLITZER REPORTS." "CROSSFIRE" starts right now.

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