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Inside Politics

Swift Boat Fallout; Bush, McCain, and 527s; RNC Preview; Interviews with Sen. Corzine, Ed Koch

Aired August 26, 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)
ANNOUNCER: A new take on John Kerry's Swift Boat battle. Our poll reveals that the Democrat has been wounded by the controversy.

Embracing the McCain line. President Bush tries to turn the senator's criticism of anti-Kerry ads to his advantage.

The New York state of mind. How do locals feel about the GOP convention and the star of the show?

Now, live from the CNN Election Express in New York, JUDY WOODRUFF'S INSIDE POLITICS.

(END VIDEOTAPE)

JUDY WOODRUFF, HOST: Thank you for joining us right here in beautiful Central Park, a green oasis in America's biggest city for well over 100 years. Of course, we're here in New York at the Republican National Convention. It gets under way next week.

This was supposed to be the site of a large anti-war rally on the eve of the convention. But protesters have had to change their plans. More on that story ahead.

Across the country, partisan divisions have been on vivid display in recent days, as attacks on John Kerry's Vietnam War record have played out. Our just-released poll sheds new light on whether the Swift Boat controversy has had any significant effect on the race for the White House. Here now, our CNN political analyst, Bill Schneider.

(BEGIN VIDEOTAPE)

WILLIAM SCHNEIDER, CNN SR. POLITICAL ANALYST (voice-over): Coming out of the Democratic convention the race was a dead heat. Now, going into the Republican convention, after weeks of controversy over John Kerry's military service in Vietnam, where do things stand? Still a tight race. Looks like nothing has changed. Or has it?

Before the Democratic convention, people said they trusted Bush more than Kerry as commander in chief. After the convention, Kerry and Bush were tied.

SEN. JOHN KERRY (D-MA), PRESIDENTIAL CANDIDATE: I defended this country as a young man and I will defend it as president.

(APPLAUSE)

SCHNEIDER: Now Bush has moved back into the lead. What happened? The Democratic convention had one central theme.

SEN. EDWARD KENNEDY (D), MASSACHUSETTS: John is a war hero.

TERESA HEINZ KERRY, JOHN KERRY'S WIFE: John is a fighter.

SCHNEIDER: That point came through. Immediately after the convention, 42 percent of voters said Kerry's military service made them more likely to vote for him, especially when they heard testimony like this.

SEN. JOHN EDWARDS (D-NC), VICE PRESIDENTIAL CANDIDATE: If you have any questions about what he's made of, just spend three minutes with the men who served with him then and who stand with him now.

SCHNEIDER: A group calling themselves Swift Boat Veterans for Truth quickly took up the challenge.

UNIDENTIFIED MALE: John Kerry is no war hero.

UNIDENTIFIED MALE: He betrayed all his shipmates. He lied before the Senate.

(END VIDEOTAPE)

SCHNEIDER: The debate over the charges monopolized the press coverage. The polls shows more than 80 percent of Americans saw or heard about the ad.

Now, do they believe the charges? No. By better than 2-1, people believe Kerry is actually telling the truth about his service in Vietnam. But the controversy still had an impact.

The number who say Kerry's military service makes them more likely to vote for him fell by half, from 42, as we saw, to just 21 percent. The Swift Boat Veterans not only hijacked the campaign, it raised doubts about Kerry, reinforcing the Republican message that Kerry may not be trustworthy.

After the Democratic convention, Kerry had a slight lead over Bush as someone who is honest and trustworthy. But now he's lost it. The ad controversy neutralized the message of the convention.

But did the ad change the horse race? No. But neither did the convention.

The war hero theme, touted by Democrats at their convention, challenged by the Swift Boat Veterans, has turned out to be a distraction. And for Kerry, a lost opportunity to score points on other issues -- Judy.

WOODRUFF: All right. Bill Schneider. A lot to look at in those numbers. Thank you very much. Well, our new poll also suggests that President Bush has not come out of the Swift Boat flap unscathed either. Fifty percent of those surveyed believe the president is responsible or some what responsible for the Swift Boat ads. And 56 percent say the president should denounce the ads.

That may help explain why Bush made a new attempt today to try to limit the political fallout. In the process, he once again reached out to Senator John McCain. Kathleen Koch is with the president in New Mexico -- Kathleen.

KATHLEEN KOCH, CNN CORRESPONDENT: Judy, in a surprise move this morning, President Bush, from Air Force One, placed a phone call to Senator John McCain, asking him to join him in lodging court action to shut down every single one of these ads placed by these unregulated 527 groups. Spokesman Scott McClellan said that the president also asked the senator, if that didn't work, whether he would support him in pursuing legislative action.

McClellan saying, "Since the FEC" -- the Federal Election Commission -- "failed to act, we would now be asking the courts to force the FEC to act to shut down these -- shut down all this activity." And the Bush-Cheney campaign says that it will be very soon filing that complaint in federal court.

Now, McClellan said that Senator McCain agreed, saying that it was a good idea that the two men link up in this effort to shut down these ads. Now, this from the same senator who told "The New York Times" this morning that he would be contacting President Bush to express his "displeasure" in the fact that the president has not yet condemned the specific content of that specific Swift Boat ad.

Now, Mr. Bush, then, this morning, obviously you're seeing him clearly trying to position himself on the right side of this issue on this day that he kicks off a pre-convention swing through some eight battleground states, starting here in New Mexico, this very important state for the president, one that he lost by the narrowest of margins back in 2000, only 366 votes to Al Gore.

Now, introducing the president this morning, just a little bit over a half hour ago, and then in about an hour, at every stop today, is former New York Mayor Rudy Giuliani. Now, both men got quite good receptions here in the state, but they certainly do have their work cut out for them.

New Mexico is a state that, in the polls, when you look at the most recent polls taken a just week ago shows John Kerry, the Democratic challenger, leading President Bush by some 10 percentage points. Also, it's important to point out that New Mexico has, with 42 percent, has the largest percentage of Hispanic population of any other state in the country, and Hispanics do traditionally vote Democratic by a 2-1 margin.

But President Bush not ceding any votes. Really out there and making a strong pitch today, taking two of his rallies to Democratic strongholds -- Judy. WOODRUFF: All right. Kathleen Koch, who's traveling with President Bush today. Kathleen, thank you.

Well, the Kerry campaign says it is long past time that Bush take John McCain's advice and put an end to "the smears and lies against John Kerry." Meantime, Kerry is taking McCain's advice himself. His campaign says that it will stop running ads showing McCain urging Bush back in 2000 to denounce similar attacks on the Arizona senator's military service.

Campaigning in Minnesota today, Kerry tried to stay on message, talking about health care and the squeeze on middle class. We'll have a full report on his day ahead.

Checking the headlines now in a convention preview edition of our "Campaign News Daily," New Yorkers are mixed on the impact the big event is going to have on their city. But their opinion of the president is very clear.

With just four days to go until the convention gets under way, it looks as if George Bush has a tough sales job ahead if it wants to win over New York City residents. A new Quinnipiac poll finds just 25 percent of registered Big Apple voters say they approve of the job the president is doing. Seventy percent say they disapprove.

When asked how the convention will affect the city, 30 percent said it will be good for the Big Apple, 33 percent said it will be bad. Another 33 percent said it won't make any difference.

Well, anti-war activists won't get to stage their rally in Central Park, but they have agreed on a deal for a different protest site. The group calling itself United for Peace and Justice was denied permission to stage a rally on the park's great lawn. Instead, the group will hold a rally in Union Square Park, just north of the East Village area. The Sunday rally is expected to be the biggest of 29 different sanctioned protests during the convention.

Earlier today, protesters unfurled this anti-Bush banner outside the Plaza Hotel. Police removed the banner after about 45 minutes. Several protesters were arrested and are expected to face charges of trespassing and reckless endangerment.

Well, with the stage being set for the GOP convention, I'll talk live with the chairman of the Republican Party, Ed Gillespie. about the big event and pitfalls for the president on the road to New York.

Also ahead, Bush and 9/11. How much will the president play up the connection next week?

Plus, Swift Boat flak. Donna Brazile and Bay Buchanan find ammunition in our new poll.

With 68 days until the election, this is INSIDE POLITICS, the place for campaign news.

(COMMERCIAL BREAK) WOODRUFF: Four days and counting until the Republican National Convention at New York City's Madison Square Garden. Well, GOP national committee chairman, Ed Gillespie, he's already right here in the Big Apple to look over last-minute preparations. And he joins me right now in fragrant Central Park.

We've been talking about the buses. Not just the buses, but the horse-drawn carriages going around.

ED GILLESPIE, RNC CHAIRMAN: The horses smell better than the buses, I noticed, Judy.

WOODRUFF: Ed Gillespie, a serious question.

GILLESPIE: Yes?

WOODRUFF: The Swift Boat controversy, the president called John McCain today to ask him to join with him in working on these 527...

GILLESPIE: Yes.

WOODRUFF: ... these outside groups. But John McCain has called on President Bush to specifically denounce these Swift Boat attack ads on John Kerry. Is the president going to do that?

GILLESPIE: Judy, I don't know. I don't speak for the president, but I'll tell you this, we are denouncing all of these 527 ads, including the ones run by moveon.org and The Media Fund, that have accused the president of lying, have accused the president of abandoning our troops, have accused the president of willfully poisoning our children.

WOODRUFF: But why...

GILLESPIE: All of them.

WOODRUFF: But why not specifically ads...

GILLESPIE: Because this is a systemic problem. This is a systemic problem.

WOODRUFF: ... that John Kerry says are lies?

GILLESPIE: This is a systemic problem that needs to be addressed, and that's why the Bush campaign today moved to try to -- since the Federal Election Commission did not act on our complaint filed three months ago, has moved to try to go to court to enforce the laws.

You know, the Federal Election Commission says, yes, what all these 527s are doing is wrong, and starting in 2006 we're going to stop them from doing it. And we want to go to court and say, "No, we need to stop them from doing it now."

WOODRUFF: All of them?

GILLESPIE: All of them.

WOODRUFF: All right. But -- and you're saying the Swift Boat ads are no worse, in your view, than all the other ads?

GILLESPIE: I'm saying that this is systemic problem that needs to be addressed, and we're moving as fast as we can and have been trying to stop these for some time. And we would love for Senator Kerry to join us in that effort.

WOODRUFF: All right. Let's move on to the convention. You've got a platform committee working hard here in New York City...

GILLESPIE: Yes.

WOODRUFF: ... to hammer out a platform. But among the language that they've agreed on, supporting a constitutional ban on abortion, opposing legal recognition of any sort of gay union, including gay marriage -- but I just want you to quickly listen to the reaction from one representative of the Log Cabin Republicans. This is a group that supports gay rights. Let's listen very quickly.

(BEGIN VIDEO CLIP)

CHRIS BARRON, LOG CABIN REPUBLICANS: ... that our party can't have it both ways. We can't have the folks sitting in this room crafting a vicious, mean-spirited platform, and then our party trying to put lipstick on the pig by sticking Rudy Giuliani and Arnold Schwarzenegger in prime time.

(END VIDEO CLIP)

WOODRUFF: Is that what the party's trying to do, put on one face while it does something else?

GILLESPIE: No, not at all. And in fact, the party platform has been subject to spirited debate, as it should be.

You know, a party should stand on principles and try to, you know, put forward some policy ideas. At the same time, we are a majority party happily in the country today.

Any party that is big enough to have the governorships of California and Texas and Florida and New York, and to have a majority of governorships across this country, to have a majority in the House and a majority in the Senate and control of the White House is going to be a party that's big enough to accommodate some differences amongst its membership. And that's what we see here in our party today.

But all of the folks, unlike in Boston, with Senator Kerry's convention, all of the people here in New York are going to be talking about the president's record and talking about his policies for the future.

WOODRUFF: Something completely different. The Census Bureau today came out with new figures on poverty in America. It has gone up again, another 1.3 million people living in poverty, 18 percent of children under 18 living in poverty, numbers that have gone up every year for the last three years. Is this not an indictment of President Bush's policies?

GILLESPIE: Judy, this is a statement of why we need to continue President Bush's pro-growth policies. The most important thing we can do, obviously, to address poverty in America is to get more people into the work force.

We've created 1.5 million jobs as a result of the president's policies this year. We need to do more. And President Bush is not going to stop until every American who wants a job can find a job.

Raising taxes on the American people, increasing regulations, doing the things that Senator Kerry is talking about, retreating to economic isolationism, that will result in lower economic growth rates, maybe even a recession. That's the worst thing we can do to try to lift people out of poverty.

WOODRUFF: So, these numbers are not a concern?

GILLESPIE: Of course they're a concern. My point is, from a policy perspective, how do you best address them? And the best way to address that concern is through our approach, not Senator Kerry's.

WOODRUFF: Ed Gillespie, chairman of the GOP. And we'll be seeing a whole lot of you over the next five, six days.

GILLESPIE: Look forward to it. Thank you, Judy.

WOODRUFF: Thanks for coming here to Central Park.

GILLESPIE: Thank you.

WOODRUFF: We appreciate it, Ed. Thanks.

Well, the Bush-Cheney campaign says it will stop airing its television ad referring to the Olympics when the games end in Athens this Sunday, according to an Olympic news Web site.

The U.S. Olympic Committee has asked the Bush campaign to pull the 30-second ad heralding the return of Afghanistan and Iraq to the games. International Olympic officials say the USOC was angry because it believes the election ad hijacks the Olympic brand, which is a registered trademark. Some Iraqi soccer team members also complained, saying they didn't want to be used to promote George Bush's reelection effort.

Well, the new presidential poll numbers as seen from the left and right. Up next, Donna Brazile and Bay Buchanan share their thoughts on our new poll.

And the role of Senator John McCain in the White House race. Is the party maverick an asset or a liability for George W. Bush?

(COMMERCIAL BREAK) WOODRUFF: Joining us now to talk more about this heated presidential race, in Miami, former Gore campaign manager, Donna Brazile. And in Washington, Bay Buchanan, president of American Cause.

Donna, to you first. These Swift Boat ad attacks on John Kerry seem to be having some effect. Our poll out today shows John Kerry behind George W. Bush by 20 points when people are asked who would be a strong and decisive leader. Is this damage that's permanent, or can John Kerry turn it around?

DONNA BRAZILE, FMR. GORE CAMPAIGN MANAGER: There's no question that John Kerry can turn it around. Look, the closer we get to the election, when the American people can size up the two candidates, John Kerry will be head and shoulders above George Bush.

I think it was a distraction, unfortunately. You know, John Kerry personally had to stand some of these veterans down. But as the American people come to recognize that they're telling bold-faced lies, I think they'll come back to John Kerry within a couple of weeks.

BAY BUCHANAN, PRESIDENT, AMERICAN CAUSE: You know, Judy, Donna refers it to as a distraction. That was a three-week pounding that John Kerry has received. And indeed, a number of these allegation that the Swift Boat have made, the fact that he wasn't in Cambodia when John Kerry numerous times has said he was, the fact that that first Purple Heart was fraud, that he was not under enemy fire, these allegations have been proven true. It's really brought a question into the American's people's mind about his qualifications as a commander in chief, extraordinary damaging to John Kerry.

BRAZILE: Bay, those allegations have not proven to be wrong. In fact, if you look at the tapes that have come out now, John O'Neill, and what he said in 1971, and reporting to his boss, Richard Nixon, he said he was in Cambodia. So, those allegations are all lies, fabrications by a group of hired guns that going after every veteran that they dislike.

BUCHANAN: No. Donna -- Donna, I'm sorry to say, but if you look at a map, as one person pointed out, and see the rivers that he was on, they don't go into Cambodia. It was impossible for John Kerry to be in Cambodia. He has backed off that. He and his campaign has backed off from that first Purple Heart.

BRAZILE: Bay, there you go. You go...

BUCHANAN: These things now are absolute...

BRAZILE: ... down all of the allegations, all of the smear, all of the character assassination. You know what? It is -- it is by the same group of veterans that came out against John McCain, came out against Max Cleland, tried to even smear Al Gore.

BUCHANAN: No. BRAZILE: So, look, the truth is, is that most Americans recognize that they're a bunch of liars. And what matters now is John Kerry once again getting back on message and telling the American people what he would do as commander in chief. That's what they want to -- they want to hear. They don't want to hear about these so- called Swift Boat Veterans for the Truth.

WOODRUFF: Bay, the polls also show that there's been some damage on President Bush. More than 50 percent of the people asked say the president should specifically denounce these ads. John McCain has called on him to do that. Is he not going to be pressured to do so?

BUCHANAN: I don't believe he -- there's any need for a president of the United States to come in and start picking and choosing ads which he denounces. He's denounced all of them, including this one as part of that.

The key here is there's a double standard. No one has demanded that John Kerry denounce these 527 ads which have been just brutal against and fraudulent against the president of the United States. Nobody demand that he -- he really take on Michael Moore and say that that movie was an outrage, a pack of lies. Instead, John Kerry invites him to the convention.

It's a double standard here, Judy. The president has denounced them all. That's all he needs to do.

BRAZILE: No, Bay, he did not denounce this specific ad. And John McCain called it dishonorable and said he should denounce it.

That's a mistake he made. And this is going to backfire as more smoke leads to, you know, officials within the Bush-Cheney campaign. You saw Ben Ginsberg step down yesterday. You see all of the other allegations that this has some fingerprints, so to speak, of officials who are close to the Bush-Cheney re-election campaign.

WOODRUFF: Very quick to both of you, the Democrats have said George W. Bush is going to get a big lift out of this convention. How many points is he going to get? Two-word answers from each one of you. Bay, how much of a lift?

BUCHANAN: Two words? Five or six points would be just fine.

WOODRUFF: OK.

BUCHANAN: Well, if he doesn't get between eight and 20 points, he is going to continue to falter in the polls.

WOODRUFF: All right.

BUCHANAN: The polls are going our way.

WOODRUFF: We're going to leave it there.

BRAZILE: I wouldn't drink champagne on that one.

WOODRUFF: All right. Bay, Donna, thank you both. Good to see you.

BRAZILE: Thank you, Judy.

BUCHANAN: It's good to be with you.

WOODRUFF: Meantime, John Kerry is proposing weekly debates. The Bush campaign says not so fast. Up next, an update on Kerry's day along the campaign trail, including his latest comments about his service in Vietnam.

Also, New York, 9/11, and the GOP convention. Republicans walk a fine line between the past and present as they prepare to convene not far from the site of the 9/11 attacks.

(COMMERCIAL BREAK)

(BEGIN VIDEOTAPE)

ANNOUNCER: A campaign challenge.

J. KERRY: Let's meet every week from now until the election and talk about the real issues facing Americans.

ANNOUNCER: Will the president take Senator Kerry up on his offer?

Next week, the Republicans dominate the spotlight, but the Democrats say they won't be drowned out.

UNIDENTIFIED MALE: Every day next week we will be highlighting the simple truth about the administration of George Bush: mission not accomplished.

ANNOUNCER: Will New Yorkers give Republicans a warm welcome? Who better to ask than Ed Koch?

ED KOCH, FMR. NEW YORK CITY MAYOR: I have sent the message out, the Republicans are coming, be nice.

ANNOUNCER: Now, live from the CNN Election Express in New York, JUDY WOODRUFF'S INSIDE POLITICS.

(END VIDEOTAPE)

WOODRUFF: Welcome back to Central Park, the beautiful park in the heart of New York City, as we count down to the Republican National Convention. In this city, one week from today, George W. Bush will accept his party's presidential nomination for a second time.

Today, the president started pre-convention travels, you could call them, in New Mexico. The White House announced that Bush wants to work with Senator John McCain to pursue legal action against the so-called 527 groups like the kind behind those controversial anti- Kerry Swift Boat ads. Our new polls shows the Swift Boat flap has taken some of the political power out of John Kerry's emphasis on his war record but it has not really changed the presidential horse race. Kerry and Bush remain neck and neck in the CNN/"USA Today"/Gallup survey, with Kerry up by one point among registered voters.

A new "Los Angeles Times" poll meantime also shows a tight race with Bush ahead by three points. Senator Kerry tried again today to move beyond the Swift Boat controversy and back on to other issues.

CNN's Joe Johns traveled with Kerry to Minnesota.

(BEGIN VIDEOTAPE)

JOE JOHNS, CNN CORRESPONDENT (voice-over): John Kerry, back on health care, an issue where a recent poll shows he holds a clear advantage with new U.S. Census data to support his claim that the middle class is getting squeezed. Numbers that show 1.4 million people lost their health care in 2003 and 1.3 million fell into poverty.

J. KERRY: The census figures are facts, they're not political diatribe, they don't have a political label on them. They're facts, statistics and they tell a story when you add them all up.

JOHNS: The Bush campaign says the census reporter does not include all the data from the past 11 months when the economy started picking up steam.

On the Swift Boat controversy Kerry repeated his charge that the Bush campaign is engaging in fear and smear tactics and said the Swift Boat Veteran charges were flat out wrong.

J. KERRY: I'm absolutely telling you the God's honest truth about what happened and what took place over there.

JOHNS: But Kerry's aides also announced that they have asked television stations to stop running a response ad on the issue that features John McCain from four years ago.

SEN. JOHN MCCAIN (R), ARIZONA: That fringe veteran said that John McCain had abandoned the veterans. I don't know if you can understand this, George, but that really hurts.

JOHNS: The Kerry campaign said it pulled the ad out of deference to McCain after reading press reports that the Arizona senator didn't like it.

(on camera): Kerry also offered to debate the president every week between now and the election. The Bush campaign seemed to reject that idea saying there will be plenty of time for debates after the convention and, quote, "over the next few weeks Kerry should take the time to finish the debates with himself."

Joe Johns, CNN, Anoka, Minnesota.

(END VIDEOTAPE)

WOODRUFF: Meantime, as President Bush begins making his way here to New York and the Republican convention, many are wondering how often and how blatantly he will hearken back to the September 11 attacks.

CNN's Bob Franken considers the fine line that Bush may have to walk between tribute and exploitation.

(BEGIN VIDEOTAPE)

BOB FRANKEN, CNN NATIONAL CORRESPONDENT (voice-over): From the day Republicans selected heavily Democratic New York, Democrats have complained it was a cynical effort to politicize September 11. They still do.

TERRY MCAULIFFE, DNC CHAIRMAN: George Bush and his allies continue to try to use it for partisan political gain but it is not going to work.

FRANKEN: It's a charge GOP officials have repeatedly and vehemently denied. But there campaigning in President Bush in New Mexico was the former mayor of New York.

RUDY GIULIANI (R), FMR. NEW YORK MAYOR: I owe a great deal to President Bush for the strength that he gave to me, to my city and to my country, when we went through our worst days.

FRANKEN: Back in March, when the Bush/Cheney campaign ran ads referring to September 11, they were criticized for exploiting the attacks. Those criticisms continue to this day, but so do the ads, the latest from an independent group friendly to the Republicans, another of the so-called 527's.

UNIDENTIFIED MALE: I feel very comfortable with him as president. We want a guy that's going to lead us to victory in this war.

FRANKEN: To be sure, John Kerry has gone out of his way to associate himself with the firefighters who have become symbols of 9/11 heroism.

J. KERRY: We drew strength when our firefighters ran upstairs, risked their lives so that others might live.

(END VIDEOTAPE)

FRANKEN (on camera): It's unavoidable that the memories of the terrorist attacks will come up under these circumstances but also unavoidable is the fact, Judy, that September 11 , before, during and after is going to continue to be an issue in this campaign.

WOODRUFF: No question. It is an issue on the minds of the American people and will be forever. Bob Franken, thank you very much. Appreciate it. Democrats working to counter the GOP message in New York don't plan to talk so much about September 11, 2001. Instead, they expect to repeatedly hearken back to May 1, 2003.

CNN's Ed Henry is covering the DNC message machine.

(BEGIN VIDEOTAPE)

ED HENRY, CNN CONGRESSIONAL CORRESPONDENT (voice-over): When President Bush landed on the USS Lincoln, Republicans thought his reelection was taking flight. But on the eve of the Republican National Convention, Democrats plan to turn the president's own words against him.

MCAULIFFE: Now, Bush is heading to New York to brag about all that he has done for America. He probably won't use that sign. So we've appropriated it.

HENRY: The Democrats' rapid response team at the convention will pound away at this theme, countering the president's claims that he has done well in everything from the war in Iraq to domestic issues like health care. McAuliffe's self-proclaimed Truth Squad will be a few blocks from Madison Square Garden in a makeshift war room. Republicans had a similar operation in Boston last month to push back on the Democratic claims launched from the podium at the FleetCenter.

ED GILLESPIE, RNC CHAIRMAN: Last night, it's predicted the extreme makeover began, that John Kerry cannot run from his 20 years out of the mainstream record in the Senate.

HENRY: Next week's Democratic counter spin will be led by Iowa Governor Tom Vilsack with help from the Big Apple's own senators, Hillary Clinton and Chuck Schumer. During the convention, Democrats will also be running a TV ad in 21 states charging the president has mishandled the economy.

BUSH: This economy of ours is steady and strong. Steady and strong.

HENRY: With Rudy Giuliani and John McCain getting podium time, Democrats will also highlight their differences with the president.

MCAULIFFE: Instead of a convention he's going to have a masquerade ball in New York City.

(END VIDEOTAPE)

HENRY (on camera): But the Democratic counterspin team will be missing one of its biggest guns, Bill Clinton. The former president is in Europe on the international portion of his book tour in Europe and will not be politically active during the Republican convention. But Mr. Clinton has already committed to headline at least ten events for the DNC this fall -- Judy.

WOODRUFF: All right, we know where he is. Ed Henry, thanks very much. In New Jersey a new development in outgoing Governor Jim McGreevey's legal saga. That story ahead.

And I'll talk with Democratic Senator Jon Corzine about the race for the White House, the battle for the Senate and the political upheaval in his own state of New Jersey.

Plus former New York City mayor Ed Koch is practically rolling out the welcome mat for Republicans. I'll ask this Democrat what he has against John Kerry.

(COMMERCIAL BREAK)

WOODRUFF: An attorney for the man who claims that he was sexually harassed by New Jersey Governor Jim McGreevey says that his client will not file a lawsuit if the governor will offer an apology.

A threatened lawsuit by Golan Cipel, a former aide to McGreevey reportedly is what eventually led the governor to announce his resignation two weeks ago. A McGreevey spokesman says there will be no apology because he says no one was sexually harassed.

During his resignation announcement, McGreevey revealed that he is gay and that he had an extramarital affair with a man. Cipel has said that he is not gay and that he never had a consensual relationship with McGreevey.

INSIDE POLITICS returns in a moment.

(COMMERCIAL BREAK)

WOODRUFF: Back here in Central Park, just days before the Republican convention gets underway.

Senator Jon Corzine of New Jersey is the Democrat point man for regaining control of the U.S. Senate. He's also being mentioned frequently as a possible future candidate for governor of New Jersey. Senator Corzine joins me right here in Central Park.

Let's get to the point in New Jersey before we talk about...

SEN. JON CORZINE (D), NEW JERSEY: Sure.

WOODRUFF: ... the convention overall. Any chance Jim McGreevey will step down before November 15th?

CORZINE: Judy, I think it's virtually certain that Jim is going to stick it out until November 15th . And I accept his decision. He thinks it's in the best interest of the state. It does give him a chance to operate on policy without having all the coups (ph) and throwing of political bosses and politics driving him in one direction or another.

WOODRUFF: But the fact that he gave a job -- an important job, homeland security related job -- to someone he was either having a relationship with or trying to have -- the man says he was being sexually harassed by the governor. We don't know which is true.

Why isn't that a reason for Jim McGreevey to step down now?

CORZINE: Well, I think Governor McGreevey thinks that's a reason to resign, but I think he has argued that an orderly transition and a completion of the agenda that he is working on takes precedent over the speed with which he gets out of office in resignation.

You know, a lot of people say we want to leave it to the electoral process. There's another argument: The selection of the candidates will not be through an electoral process if he resigns on September 2nd. People who would run would be picked by party bosses, and that's not particularly a good thing either.

WOODRUFF: Very quickly, you've made it clear you're at least going to consider running yourself...

CORZINE: Absolutely.

WOODRUFF: ... when the job is open?

CORZINE: Absolutely.

WOODRUFF: Let's talk about the state of the presidential campaign. Our new poll is showing that John Kerry apparently has been hurt by the Swift Boat ads; a number of questions show people having less opinion of him on a number of points.

Was he -- do you fault the way he answered the charges in those ads?

CORZINE: I don't fault him on how he's dealt with this ad situation. I think he tried to stay on public policy issues, things that are important to the American people.

As you know today, the Census Bureau announced that poverty rate is up in America, real wages are down, and the number of uninsured in America has gone up by 1.3 million or four-and-a-half million during the Bush tenure.

John Kerry's tried to talk to the issues that, really, middle class Americans already are struggling with. And I think that was more important. It started to have a bite, so I think that he's taken a tact that's responsible.

You know, we've basically had people that have lied, and the facts prove that they've lied based on historical data.

WOODRUFF: But in the real world of American politics, you know and the way the media covers these things, the way the ads were out there, did John Kerry wait too long to try to get his arms around...

CORZINE: I don't think so, because I actually trust the judgment of the American people to sort through the facts when they're made aware of them, when they hear that people are denying things that they even supported. You got one guy that got a Bronze Star is claiming that there were no bullets flying, but he got a Bronze Star because of it. I don't think once they know this, they're going to be believers of this kind of negative smear politics.

WOODRUFF: But even if those ads are not true -- let me just cite to you one question in our poll. A few weeks ago before the ads ran, people were asked who'd be a more strong and decisive leader. George Bush had a 10-point lead. Now, he's got a 20-point lead -- who'd be a strong and decisive, and honest and trustworthy. The president has turned that one around, as well.

CORZINE: Judy, I think that smear politics, unchallenged, ultimately if they're unchallenged actually work. But this has been challenged. It's very clear that people were not stating the truth, and I think that will reverberate against those people that have used that for their benefit.

And in my view, it's pretty clear that there's a close tie with either Bush supporters or people that are even inside the Bush campaign associated with these ads. I think it's going to backfire on them.

WOODRUFF: You don't think John Kerry's missed an opportunity to get the subject on to something else?

CORZINE: Well, I think John Kerry was trying to stay on healthcare and jobs and things that are important...

WOODRUFF: By not addressing it?

CORZINE: ... by not addressing it. And I think, you know, he has now taken it on full charge. And now, I think it's time that the president be held accountable for the rising poverty rate in this country, the number of unemployed, the number of uninsured, and the declining real wages.

Those things make difference to these people right here. Middle class America is suffering seriously by the decline in their economic well-being. And John Kerry's got a plan on health insurance. He's talking about bringing jobs back home, not shipping them offshore. And he can create a lot of jobs by doing positive things with our tax system as opposed to what President Bush has.

WOODRUFF: Senator Jon Corzine, we appreciate you joining us.

CORZINE: Good. Good to be here.

WOODRUFF: We appreciate it. Good to see you. Thanks very much.

Well, as New York City braces for a Republican infusion, you might call it, one of the Big Apple's more colorful political characters weighs in on what's about to happen. Coming up, I go one- on-one with former New York Mayor Ed Koch, who reveals who he'll vote for this November and beyond.

(COMMERCIAL BREAK)

WOODRUFF: We are here in New York and a lot of press people are in New York, but it remains to be seen how the predominantly Democratic city will take to being overrun with Republicans for the better part of a week. Former New York Mayor Ed Koch has two words of advice for New Yorkers: be nice.

I took a stroll with Ed Koch yesterday in Strawberry Fields right here in Central Park.

(BEGIN VIDEOTAPE)

WOODRUFF: New York is the quintessential Democratic city. Is this place ready for the Republicans?

KOCH: Well, I've been around town and I have sent the message out, the Republicans are coming, be nice. And then I explained why. Because I want those delegates to go back to their homes and say they had the best time of their lives. And then, when we come knocking on their doors in Washington, they'll remember that we were nice to them and we want them to be nice to us.

WOODRUFF: All right. The other way around, how are the Republicans going to take to New York? I mean, you already have the majority leader of the House of Representatives, Tom DeLay, talking about staying on a cruise ship. They put that idea behind them.

KOCH: They stopped that. That was a mistake on their part. We told them they will have a wonderful time in New York. And they said, you're right, we trust you.

WOODRUFF: We're already hearing a lot, Mr. Mayor, about protests. Could those protests overshadow what's going on inside Madison Square Garden?

KOCH: I hope not. And I don't think so. We welcome protesters as long as they obey the law. They have rights, the rights include being able to have the people that you're protesting against hear you and see you, hear and see you, and that has been arranged down at Madison Square Garden. You don't have the light to engage in illegality.

WOODRUFF: You have already said you are going to vote for George W. Bush.

KOCH: Yes, I am. I don't agree with him on any domestic issues but I agree with him on the single overriding issue of fighting international terrorism. And I don't think the Democratic Party has the stomach to do it. And that's my decision and so I will be supporting George Bush.

WOODRUFF: What's wrong with John Kerry?

KOCH: Well, let me just say, you don't know where he's right or wrong because he changes so often, even on the issue of fighting international terrorism. When he was at the convention in Boston, he said he made a mistake in voting for the war. Then, he changes his views and he says that he would have voted for the war even if he knew there weren't weapons of mass destruction. So can you believe him? I don't.

WOODRUFF: Let me ask quickly about two headlines right now we're covering in this election. One is the whole controversy over John Kerry's record in Vietnam. Have the critics gone overboard attacking him on that?

KOCH: Absolutely. I don't think that record should be questioned. He is, in my judgment, a war hero. But what has that got to do with the election? What's more important is what did he do for 19 years in the United States Senate?

But there is no basis for questioning either Kerry's war record, or Bush's war record. It's an outrage that anybody does.

WOODRUFF: Second headline today is yesterday the vice president, Dick Cheney, said that he disagrees with the president on the issue of whether there should be a constitutional amendment banning gay marriage. Who's right, Vice President Cheney or President Bush?

KOCH: There is no question there should be the right for same sex marriage. And what is interesting about John Kerry more than the vice president, is Cheney wants to protect the right as he should, he's a father. But John Kerry, when he's in Massachusetts, he says he's against a constitutional state amendment.

And I'm certainly against that amendment. But then he goes Missouri, where 70 percent of the people voted for a constitutional amendment banning same sex marriage. And he says if he were living in Missouri, he would have voted the same way. That's an outrage.

WOODRUFF: But in terms of Cheney or Bush, you agree with Vice President Cheney?

KOCH: Absolutely. And I don't believe there should be a state amendment that carries, I believe that the right of marriage should transcend, whether it's opposite sex or single-sex, same sex.

WOODRUFF: Last quick question. Two prominent New York Republicans are already being talked about for president in '08, Governor George Pataki, former Mayor Rudy Giuliani. What do you think about all that?

KOCH: I'm not for either of them, I'm for Hillary in 2008.

(END VIDEOTAPE)

WOODRUFF: Lest there be any confusion, he's talking about the junior senator from the state of New York, Hillary Clinton. INSIDE POLITICS continues in just a moment.

(COMMERCIAL BREAK)

(STOCK MARKET REPORT) WOODRUFF: That's it for this INSIDE POLITICS edition from Central Park. I'm Judy Woodruff, live from the heart of New York City. Be sure to join us again tomorrow. CNN's Election Express Bus and I will be at the Chelsea Piers along the Hudson River. Have a good evening. "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 26, 2004 - 15:30   ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(BEGIN VIDEOTAPE)
ANNOUNCER: A new take on John Kerry's Swift Boat battle. Our poll reveals that the Democrat has been wounded by the controversy.

Embracing the McCain line. President Bush tries to turn the senator's criticism of anti-Kerry ads to his advantage.

The New York state of mind. How do locals feel about the GOP convention and the star of the show?

Now, live from the CNN Election Express in New York, JUDY WOODRUFF'S INSIDE POLITICS.

(END VIDEOTAPE)

JUDY WOODRUFF, HOST: Thank you for joining us right here in beautiful Central Park, a green oasis in America's biggest city for well over 100 years. Of course, we're here in New York at the Republican National Convention. It gets under way next week.

This was supposed to be the site of a large anti-war rally on the eve of the convention. But protesters have had to change their plans. More on that story ahead.

Across the country, partisan divisions have been on vivid display in recent days, as attacks on John Kerry's Vietnam War record have played out. Our just-released poll sheds new light on whether the Swift Boat controversy has had any significant effect on the race for the White House. Here now, our CNN political analyst, Bill Schneider.

(BEGIN VIDEOTAPE)

WILLIAM SCHNEIDER, CNN SR. POLITICAL ANALYST (voice-over): Coming out of the Democratic convention the race was a dead heat. Now, going into the Republican convention, after weeks of controversy over John Kerry's military service in Vietnam, where do things stand? Still a tight race. Looks like nothing has changed. Or has it?

Before the Democratic convention, people said they trusted Bush more than Kerry as commander in chief. After the convention, Kerry and Bush were tied.

SEN. JOHN KERRY (D-MA), PRESIDENTIAL CANDIDATE: I defended this country as a young man and I will defend it as president.

(APPLAUSE)

SCHNEIDER: Now Bush has moved back into the lead. What happened? The Democratic convention had one central theme.

SEN. EDWARD KENNEDY (D), MASSACHUSETTS: John is a war hero.

TERESA HEINZ KERRY, JOHN KERRY'S WIFE: John is a fighter.

SCHNEIDER: That point came through. Immediately after the convention, 42 percent of voters said Kerry's military service made them more likely to vote for him, especially when they heard testimony like this.

SEN. JOHN EDWARDS (D-NC), VICE PRESIDENTIAL CANDIDATE: If you have any questions about what he's made of, just spend three minutes with the men who served with him then and who stand with him now.

SCHNEIDER: A group calling themselves Swift Boat Veterans for Truth quickly took up the challenge.

UNIDENTIFIED MALE: John Kerry is no war hero.

UNIDENTIFIED MALE: He betrayed all his shipmates. He lied before the Senate.

(END VIDEOTAPE)

SCHNEIDER: The debate over the charges monopolized the press coverage. The polls shows more than 80 percent of Americans saw or heard about the ad.

Now, do they believe the charges? No. By better than 2-1, people believe Kerry is actually telling the truth about his service in Vietnam. But the controversy still had an impact.

The number who say Kerry's military service makes them more likely to vote for him fell by half, from 42, as we saw, to just 21 percent. The Swift Boat Veterans not only hijacked the campaign, it raised doubts about Kerry, reinforcing the Republican message that Kerry may not be trustworthy.

After the Democratic convention, Kerry had a slight lead over Bush as someone who is honest and trustworthy. But now he's lost it. The ad controversy neutralized the message of the convention.

But did the ad change the horse race? No. But neither did the convention.

The war hero theme, touted by Democrats at their convention, challenged by the Swift Boat Veterans, has turned out to be a distraction. And for Kerry, a lost opportunity to score points on other issues -- Judy.

WOODRUFF: All right. Bill Schneider. A lot to look at in those numbers. Thank you very much. Well, our new poll also suggests that President Bush has not come out of the Swift Boat flap unscathed either. Fifty percent of those surveyed believe the president is responsible or some what responsible for the Swift Boat ads. And 56 percent say the president should denounce the ads.

That may help explain why Bush made a new attempt today to try to limit the political fallout. In the process, he once again reached out to Senator John McCain. Kathleen Koch is with the president in New Mexico -- Kathleen.

KATHLEEN KOCH, CNN CORRESPONDENT: Judy, in a surprise move this morning, President Bush, from Air Force One, placed a phone call to Senator John McCain, asking him to join him in lodging court action to shut down every single one of these ads placed by these unregulated 527 groups. Spokesman Scott McClellan said that the president also asked the senator, if that didn't work, whether he would support him in pursuing legislative action.

McClellan saying, "Since the FEC" -- the Federal Election Commission -- "failed to act, we would now be asking the courts to force the FEC to act to shut down these -- shut down all this activity." And the Bush-Cheney campaign says that it will be very soon filing that complaint in federal court.

Now, McClellan said that Senator McCain agreed, saying that it was a good idea that the two men link up in this effort to shut down these ads. Now, this from the same senator who told "The New York Times" this morning that he would be contacting President Bush to express his "displeasure" in the fact that the president has not yet condemned the specific content of that specific Swift Boat ad.

Now, Mr. Bush, then, this morning, obviously you're seeing him clearly trying to position himself on the right side of this issue on this day that he kicks off a pre-convention swing through some eight battleground states, starting here in New Mexico, this very important state for the president, one that he lost by the narrowest of margins back in 2000, only 366 votes to Al Gore.

Now, introducing the president this morning, just a little bit over a half hour ago, and then in about an hour, at every stop today, is former New York Mayor Rudy Giuliani. Now, both men got quite good receptions here in the state, but they certainly do have their work cut out for them.

New Mexico is a state that, in the polls, when you look at the most recent polls taken a just week ago shows John Kerry, the Democratic challenger, leading President Bush by some 10 percentage points. Also, it's important to point out that New Mexico has, with 42 percent, has the largest percentage of Hispanic population of any other state in the country, and Hispanics do traditionally vote Democratic by a 2-1 margin.

But President Bush not ceding any votes. Really out there and making a strong pitch today, taking two of his rallies to Democratic strongholds -- Judy. WOODRUFF: All right. Kathleen Koch, who's traveling with President Bush today. Kathleen, thank you.

Well, the Kerry campaign says it is long past time that Bush take John McCain's advice and put an end to "the smears and lies against John Kerry." Meantime, Kerry is taking McCain's advice himself. His campaign says that it will stop running ads showing McCain urging Bush back in 2000 to denounce similar attacks on the Arizona senator's military service.

Campaigning in Minnesota today, Kerry tried to stay on message, talking about health care and the squeeze on middle class. We'll have a full report on his day ahead.

Checking the headlines now in a convention preview edition of our "Campaign News Daily," New Yorkers are mixed on the impact the big event is going to have on their city. But their opinion of the president is very clear.

With just four days to go until the convention gets under way, it looks as if George Bush has a tough sales job ahead if it wants to win over New York City residents. A new Quinnipiac poll finds just 25 percent of registered Big Apple voters say they approve of the job the president is doing. Seventy percent say they disapprove.

When asked how the convention will affect the city, 30 percent said it will be good for the Big Apple, 33 percent said it will be bad. Another 33 percent said it won't make any difference.

Well, anti-war activists won't get to stage their rally in Central Park, but they have agreed on a deal for a different protest site. The group calling itself United for Peace and Justice was denied permission to stage a rally on the park's great lawn. Instead, the group will hold a rally in Union Square Park, just north of the East Village area. The Sunday rally is expected to be the biggest of 29 different sanctioned protests during the convention.

Earlier today, protesters unfurled this anti-Bush banner outside the Plaza Hotel. Police removed the banner after about 45 minutes. Several protesters were arrested and are expected to face charges of trespassing and reckless endangerment.

Well, with the stage being set for the GOP convention, I'll talk live with the chairman of the Republican Party, Ed Gillespie. about the big event and pitfalls for the president on the road to New York.

Also ahead, Bush and 9/11. How much will the president play up the connection next week?

Plus, Swift Boat flak. Donna Brazile and Bay Buchanan find ammunition in our new poll.

With 68 days until the election, this is INSIDE POLITICS, the place for campaign news.

(COMMERCIAL BREAK) WOODRUFF: Four days and counting until the Republican National Convention at New York City's Madison Square Garden. Well, GOP national committee chairman, Ed Gillespie, he's already right here in the Big Apple to look over last-minute preparations. And he joins me right now in fragrant Central Park.

We've been talking about the buses. Not just the buses, but the horse-drawn carriages going around.

ED GILLESPIE, RNC CHAIRMAN: The horses smell better than the buses, I noticed, Judy.

WOODRUFF: Ed Gillespie, a serious question.

GILLESPIE: Yes?

WOODRUFF: The Swift Boat controversy, the president called John McCain today to ask him to join with him in working on these 527...

GILLESPIE: Yes.

WOODRUFF: ... these outside groups. But John McCain has called on President Bush to specifically denounce these Swift Boat attack ads on John Kerry. Is the president going to do that?

GILLESPIE: Judy, I don't know. I don't speak for the president, but I'll tell you this, we are denouncing all of these 527 ads, including the ones run by moveon.org and The Media Fund, that have accused the president of lying, have accused the president of abandoning our troops, have accused the president of willfully poisoning our children.

WOODRUFF: But why...

GILLESPIE: All of them.

WOODRUFF: But why not specifically ads...

GILLESPIE: Because this is a systemic problem. This is a systemic problem.

WOODRUFF: ... that John Kerry says are lies?

GILLESPIE: This is a systemic problem that needs to be addressed, and that's why the Bush campaign today moved to try to -- since the Federal Election Commission did not act on our complaint filed three months ago, has moved to try to go to court to enforce the laws.

You know, the Federal Election Commission says, yes, what all these 527s are doing is wrong, and starting in 2006 we're going to stop them from doing it. And we want to go to court and say, "No, we need to stop them from doing it now."

WOODRUFF: All of them?

GILLESPIE: All of them.

WOODRUFF: All right. But -- and you're saying the Swift Boat ads are no worse, in your view, than all the other ads?

GILLESPIE: I'm saying that this is systemic problem that needs to be addressed, and we're moving as fast as we can and have been trying to stop these for some time. And we would love for Senator Kerry to join us in that effort.

WOODRUFF: All right. Let's move on to the convention. You've got a platform committee working hard here in New York City...

GILLESPIE: Yes.

WOODRUFF: ... to hammer out a platform. But among the language that they've agreed on, supporting a constitutional ban on abortion, opposing legal recognition of any sort of gay union, including gay marriage -- but I just want you to quickly listen to the reaction from one representative of the Log Cabin Republicans. This is a group that supports gay rights. Let's listen very quickly.

(BEGIN VIDEO CLIP)

CHRIS BARRON, LOG CABIN REPUBLICANS: ... that our party can't have it both ways. We can't have the folks sitting in this room crafting a vicious, mean-spirited platform, and then our party trying to put lipstick on the pig by sticking Rudy Giuliani and Arnold Schwarzenegger in prime time.

(END VIDEO CLIP)

WOODRUFF: Is that what the party's trying to do, put on one face while it does something else?

GILLESPIE: No, not at all. And in fact, the party platform has been subject to spirited debate, as it should be.

You know, a party should stand on principles and try to, you know, put forward some policy ideas. At the same time, we are a majority party happily in the country today.

Any party that is big enough to have the governorships of California and Texas and Florida and New York, and to have a majority of governorships across this country, to have a majority in the House and a majority in the Senate and control of the White House is going to be a party that's big enough to accommodate some differences amongst its membership. And that's what we see here in our party today.

But all of the folks, unlike in Boston, with Senator Kerry's convention, all of the people here in New York are going to be talking about the president's record and talking about his policies for the future.

WOODRUFF: Something completely different. The Census Bureau today came out with new figures on poverty in America. It has gone up again, another 1.3 million people living in poverty, 18 percent of children under 18 living in poverty, numbers that have gone up every year for the last three years. Is this not an indictment of President Bush's policies?

GILLESPIE: Judy, this is a statement of why we need to continue President Bush's pro-growth policies. The most important thing we can do, obviously, to address poverty in America is to get more people into the work force.

We've created 1.5 million jobs as a result of the president's policies this year. We need to do more. And President Bush is not going to stop until every American who wants a job can find a job.

Raising taxes on the American people, increasing regulations, doing the things that Senator Kerry is talking about, retreating to economic isolationism, that will result in lower economic growth rates, maybe even a recession. That's the worst thing we can do to try to lift people out of poverty.

WOODRUFF: So, these numbers are not a concern?

GILLESPIE: Of course they're a concern. My point is, from a policy perspective, how do you best address them? And the best way to address that concern is through our approach, not Senator Kerry's.

WOODRUFF: Ed Gillespie, chairman of the GOP. And we'll be seeing a whole lot of you over the next five, six days.

GILLESPIE: Look forward to it. Thank you, Judy.

WOODRUFF: Thanks for coming here to Central Park.

GILLESPIE: Thank you.

WOODRUFF: We appreciate it, Ed. Thanks.

Well, the Bush-Cheney campaign says it will stop airing its television ad referring to the Olympics when the games end in Athens this Sunday, according to an Olympic news Web site.

The U.S. Olympic Committee has asked the Bush campaign to pull the 30-second ad heralding the return of Afghanistan and Iraq to the games. International Olympic officials say the USOC was angry because it believes the election ad hijacks the Olympic brand, which is a registered trademark. Some Iraqi soccer team members also complained, saying they didn't want to be used to promote George Bush's reelection effort.

Well, the new presidential poll numbers as seen from the left and right. Up next, Donna Brazile and Bay Buchanan share their thoughts on our new poll.

And the role of Senator John McCain in the White House race. Is the party maverick an asset or a liability for George W. Bush?

(COMMERCIAL BREAK) WOODRUFF: Joining us now to talk more about this heated presidential race, in Miami, former Gore campaign manager, Donna Brazile. And in Washington, Bay Buchanan, president of American Cause.

Donna, to you first. These Swift Boat ad attacks on John Kerry seem to be having some effect. Our poll out today shows John Kerry behind George W. Bush by 20 points when people are asked who would be a strong and decisive leader. Is this damage that's permanent, or can John Kerry turn it around?

DONNA BRAZILE, FMR. GORE CAMPAIGN MANAGER: There's no question that John Kerry can turn it around. Look, the closer we get to the election, when the American people can size up the two candidates, John Kerry will be head and shoulders above George Bush.

I think it was a distraction, unfortunately. You know, John Kerry personally had to stand some of these veterans down. But as the American people come to recognize that they're telling bold-faced lies, I think they'll come back to John Kerry within a couple of weeks.

BAY BUCHANAN, PRESIDENT, AMERICAN CAUSE: You know, Judy, Donna refers it to as a distraction. That was a three-week pounding that John Kerry has received. And indeed, a number of these allegation that the Swift Boat have made, the fact that he wasn't in Cambodia when John Kerry numerous times has said he was, the fact that that first Purple Heart was fraud, that he was not under enemy fire, these allegations have been proven true. It's really brought a question into the American's people's mind about his qualifications as a commander in chief, extraordinary damaging to John Kerry.

BRAZILE: Bay, those allegations have not proven to be wrong. In fact, if you look at the tapes that have come out now, John O'Neill, and what he said in 1971, and reporting to his boss, Richard Nixon, he said he was in Cambodia. So, those allegations are all lies, fabrications by a group of hired guns that going after every veteran that they dislike.

BUCHANAN: No. Donna -- Donna, I'm sorry to say, but if you look at a map, as one person pointed out, and see the rivers that he was on, they don't go into Cambodia. It was impossible for John Kerry to be in Cambodia. He has backed off that. He and his campaign has backed off from that first Purple Heart.

BRAZILE: Bay, there you go. You go...

BUCHANAN: These things now are absolute...

BRAZILE: ... down all of the allegations, all of the smear, all of the character assassination. You know what? It is -- it is by the same group of veterans that came out against John McCain, came out against Max Cleland, tried to even smear Al Gore.

BUCHANAN: No. BRAZILE: So, look, the truth is, is that most Americans recognize that they're a bunch of liars. And what matters now is John Kerry once again getting back on message and telling the American people what he would do as commander in chief. That's what they want to -- they want to hear. They don't want to hear about these so- called Swift Boat Veterans for the Truth.

WOODRUFF: Bay, the polls also show that there's been some damage on President Bush. More than 50 percent of the people asked say the president should specifically denounce these ads. John McCain has called on him to do that. Is he not going to be pressured to do so?

BUCHANAN: I don't believe he -- there's any need for a president of the United States to come in and start picking and choosing ads which he denounces. He's denounced all of them, including this one as part of that.

The key here is there's a double standard. No one has demanded that John Kerry denounce these 527 ads which have been just brutal against and fraudulent against the president of the United States. Nobody demand that he -- he really take on Michael Moore and say that that movie was an outrage, a pack of lies. Instead, John Kerry invites him to the convention.

It's a double standard here, Judy. The president has denounced them all. That's all he needs to do.

BRAZILE: No, Bay, he did not denounce this specific ad. And John McCain called it dishonorable and said he should denounce it.

That's a mistake he made. And this is going to backfire as more smoke leads to, you know, officials within the Bush-Cheney campaign. You saw Ben Ginsberg step down yesterday. You see all of the other allegations that this has some fingerprints, so to speak, of officials who are close to the Bush-Cheney re-election campaign.

WOODRUFF: Very quick to both of you, the Democrats have said George W. Bush is going to get a big lift out of this convention. How many points is he going to get? Two-word answers from each one of you. Bay, how much of a lift?

BUCHANAN: Two words? Five or six points would be just fine.

WOODRUFF: OK.

BUCHANAN: Well, if he doesn't get between eight and 20 points, he is going to continue to falter in the polls.

WOODRUFF: All right.

BUCHANAN: The polls are going our way.

WOODRUFF: We're going to leave it there.

BRAZILE: I wouldn't drink champagne on that one.

WOODRUFF: All right. Bay, Donna, thank you both. Good to see you.

BRAZILE: Thank you, Judy.

BUCHANAN: It's good to be with you.

WOODRUFF: Meantime, John Kerry is proposing weekly debates. The Bush campaign says not so fast. Up next, an update on Kerry's day along the campaign trail, including his latest comments about his service in Vietnam.

Also, New York, 9/11, and the GOP convention. Republicans walk a fine line between the past and present as they prepare to convene not far from the site of the 9/11 attacks.

(COMMERCIAL BREAK)

(BEGIN VIDEOTAPE)

ANNOUNCER: A campaign challenge.

J. KERRY: Let's meet every week from now until the election and talk about the real issues facing Americans.

ANNOUNCER: Will the president take Senator Kerry up on his offer?

Next week, the Republicans dominate the spotlight, but the Democrats say they won't be drowned out.

UNIDENTIFIED MALE: Every day next week we will be highlighting the simple truth about the administration of George Bush: mission not accomplished.

ANNOUNCER: Will New Yorkers give Republicans a warm welcome? Who better to ask than Ed Koch?

ED KOCH, FMR. NEW YORK CITY MAYOR: I have sent the message out, the Republicans are coming, be nice.

ANNOUNCER: Now, live from the CNN Election Express in New York, JUDY WOODRUFF'S INSIDE POLITICS.

(END VIDEOTAPE)

WOODRUFF: Welcome back to Central Park, the beautiful park in the heart of New York City, as we count down to the Republican National Convention. In this city, one week from today, George W. Bush will accept his party's presidential nomination for a second time.

Today, the president started pre-convention travels, you could call them, in New Mexico. The White House announced that Bush wants to work with Senator John McCain to pursue legal action against the so-called 527 groups like the kind behind those controversial anti- Kerry Swift Boat ads. Our new polls shows the Swift Boat flap has taken some of the political power out of John Kerry's emphasis on his war record but it has not really changed the presidential horse race. Kerry and Bush remain neck and neck in the CNN/"USA Today"/Gallup survey, with Kerry up by one point among registered voters.

A new "Los Angeles Times" poll meantime also shows a tight race with Bush ahead by three points. Senator Kerry tried again today to move beyond the Swift Boat controversy and back on to other issues.

CNN's Joe Johns traveled with Kerry to Minnesota.

(BEGIN VIDEOTAPE)

JOE JOHNS, CNN CORRESPONDENT (voice-over): John Kerry, back on health care, an issue where a recent poll shows he holds a clear advantage with new U.S. Census data to support his claim that the middle class is getting squeezed. Numbers that show 1.4 million people lost their health care in 2003 and 1.3 million fell into poverty.

J. KERRY: The census figures are facts, they're not political diatribe, they don't have a political label on them. They're facts, statistics and they tell a story when you add them all up.

JOHNS: The Bush campaign says the census reporter does not include all the data from the past 11 months when the economy started picking up steam.

On the Swift Boat controversy Kerry repeated his charge that the Bush campaign is engaging in fear and smear tactics and said the Swift Boat Veteran charges were flat out wrong.

J. KERRY: I'm absolutely telling you the God's honest truth about what happened and what took place over there.

JOHNS: But Kerry's aides also announced that they have asked television stations to stop running a response ad on the issue that features John McCain from four years ago.

SEN. JOHN MCCAIN (R), ARIZONA: That fringe veteran said that John McCain had abandoned the veterans. I don't know if you can understand this, George, but that really hurts.

JOHNS: The Kerry campaign said it pulled the ad out of deference to McCain after reading press reports that the Arizona senator didn't like it.

(on camera): Kerry also offered to debate the president every week between now and the election. The Bush campaign seemed to reject that idea saying there will be plenty of time for debates after the convention and, quote, "over the next few weeks Kerry should take the time to finish the debates with himself."

Joe Johns, CNN, Anoka, Minnesota.

(END VIDEOTAPE)

WOODRUFF: Meantime, as President Bush begins making his way here to New York and the Republican convention, many are wondering how often and how blatantly he will hearken back to the September 11 attacks.

CNN's Bob Franken considers the fine line that Bush may have to walk between tribute and exploitation.

(BEGIN VIDEOTAPE)

BOB FRANKEN, CNN NATIONAL CORRESPONDENT (voice-over): From the day Republicans selected heavily Democratic New York, Democrats have complained it was a cynical effort to politicize September 11. They still do.

TERRY MCAULIFFE, DNC CHAIRMAN: George Bush and his allies continue to try to use it for partisan political gain but it is not going to work.

FRANKEN: It's a charge GOP officials have repeatedly and vehemently denied. But there campaigning in President Bush in New Mexico was the former mayor of New York.

RUDY GIULIANI (R), FMR. NEW YORK MAYOR: I owe a great deal to President Bush for the strength that he gave to me, to my city and to my country, when we went through our worst days.

FRANKEN: Back in March, when the Bush/Cheney campaign ran ads referring to September 11, they were criticized for exploiting the attacks. Those criticisms continue to this day, but so do the ads, the latest from an independent group friendly to the Republicans, another of the so-called 527's.

UNIDENTIFIED MALE: I feel very comfortable with him as president. We want a guy that's going to lead us to victory in this war.

FRANKEN: To be sure, John Kerry has gone out of his way to associate himself with the firefighters who have become symbols of 9/11 heroism.

J. KERRY: We drew strength when our firefighters ran upstairs, risked their lives so that others might live.

(END VIDEOTAPE)

FRANKEN (on camera): It's unavoidable that the memories of the terrorist attacks will come up under these circumstances but also unavoidable is the fact, Judy, that September 11 , before, during and after is going to continue to be an issue in this campaign.

WOODRUFF: No question. It is an issue on the minds of the American people and will be forever. Bob Franken, thank you very much. Appreciate it. Democrats working to counter the GOP message in New York don't plan to talk so much about September 11, 2001. Instead, they expect to repeatedly hearken back to May 1, 2003.

CNN's Ed Henry is covering the DNC message machine.

(BEGIN VIDEOTAPE)

ED HENRY, CNN CONGRESSIONAL CORRESPONDENT (voice-over): When President Bush landed on the USS Lincoln, Republicans thought his reelection was taking flight. But on the eve of the Republican National Convention, Democrats plan to turn the president's own words against him.

MCAULIFFE: Now, Bush is heading to New York to brag about all that he has done for America. He probably won't use that sign. So we've appropriated it.

HENRY: The Democrats' rapid response team at the convention will pound away at this theme, countering the president's claims that he has done well in everything from the war in Iraq to domestic issues like health care. McAuliffe's self-proclaimed Truth Squad will be a few blocks from Madison Square Garden in a makeshift war room. Republicans had a similar operation in Boston last month to push back on the Democratic claims launched from the podium at the FleetCenter.

ED GILLESPIE, RNC CHAIRMAN: Last night, it's predicted the extreme makeover began, that John Kerry cannot run from his 20 years out of the mainstream record in the Senate.

HENRY: Next week's Democratic counter spin will be led by Iowa Governor Tom Vilsack with help from the Big Apple's own senators, Hillary Clinton and Chuck Schumer. During the convention, Democrats will also be running a TV ad in 21 states charging the president has mishandled the economy.

BUSH: This economy of ours is steady and strong. Steady and strong.

HENRY: With Rudy Giuliani and John McCain getting podium time, Democrats will also highlight their differences with the president.

MCAULIFFE: Instead of a convention he's going to have a masquerade ball in New York City.

(END VIDEOTAPE)

HENRY (on camera): But the Democratic counterspin team will be missing one of its biggest guns, Bill Clinton. The former president is in Europe on the international portion of his book tour in Europe and will not be politically active during the Republican convention. But Mr. Clinton has already committed to headline at least ten events for the DNC this fall -- Judy.

WOODRUFF: All right, we know where he is. Ed Henry, thanks very much. In New Jersey a new development in outgoing Governor Jim McGreevey's legal saga. That story ahead.

And I'll talk with Democratic Senator Jon Corzine about the race for the White House, the battle for the Senate and the political upheaval in his own state of New Jersey.

Plus former New York City mayor Ed Koch is practically rolling out the welcome mat for Republicans. I'll ask this Democrat what he has against John Kerry.

(COMMERCIAL BREAK)

WOODRUFF: An attorney for the man who claims that he was sexually harassed by New Jersey Governor Jim McGreevey says that his client will not file a lawsuit if the governor will offer an apology.

A threatened lawsuit by Golan Cipel, a former aide to McGreevey reportedly is what eventually led the governor to announce his resignation two weeks ago. A McGreevey spokesman says there will be no apology because he says no one was sexually harassed.

During his resignation announcement, McGreevey revealed that he is gay and that he had an extramarital affair with a man. Cipel has said that he is not gay and that he never had a consensual relationship with McGreevey.

INSIDE POLITICS returns in a moment.

(COMMERCIAL BREAK)

WOODRUFF: Back here in Central Park, just days before the Republican convention gets underway.

Senator Jon Corzine of New Jersey is the Democrat point man for regaining control of the U.S. Senate. He's also being mentioned frequently as a possible future candidate for governor of New Jersey. Senator Corzine joins me right here in Central Park.

Let's get to the point in New Jersey before we talk about...

SEN. JON CORZINE (D), NEW JERSEY: Sure.

WOODRUFF: ... the convention overall. Any chance Jim McGreevey will step down before November 15th?

CORZINE: Judy, I think it's virtually certain that Jim is going to stick it out until November 15th . And I accept his decision. He thinks it's in the best interest of the state. It does give him a chance to operate on policy without having all the coups (ph) and throwing of political bosses and politics driving him in one direction or another.

WOODRUFF: But the fact that he gave a job -- an important job, homeland security related job -- to someone he was either having a relationship with or trying to have -- the man says he was being sexually harassed by the governor. We don't know which is true.

Why isn't that a reason for Jim McGreevey to step down now?

CORZINE: Well, I think Governor McGreevey thinks that's a reason to resign, but I think he has argued that an orderly transition and a completion of the agenda that he is working on takes precedent over the speed with which he gets out of office in resignation.

You know, a lot of people say we want to leave it to the electoral process. There's another argument: The selection of the candidates will not be through an electoral process if he resigns on September 2nd. People who would run would be picked by party bosses, and that's not particularly a good thing either.

WOODRUFF: Very quickly, you've made it clear you're at least going to consider running yourself...

CORZINE: Absolutely.

WOODRUFF: ... when the job is open?

CORZINE: Absolutely.

WOODRUFF: Let's talk about the state of the presidential campaign. Our new poll is showing that John Kerry apparently has been hurt by the Swift Boat ads; a number of questions show people having less opinion of him on a number of points.

Was he -- do you fault the way he answered the charges in those ads?

CORZINE: I don't fault him on how he's dealt with this ad situation. I think he tried to stay on public policy issues, things that are important to the American people.

As you know today, the Census Bureau announced that poverty rate is up in America, real wages are down, and the number of uninsured in America has gone up by 1.3 million or four-and-a-half million during the Bush tenure.

John Kerry's tried to talk to the issues that, really, middle class Americans already are struggling with. And I think that was more important. It started to have a bite, so I think that he's taken a tact that's responsible.

You know, we've basically had people that have lied, and the facts prove that they've lied based on historical data.

WOODRUFF: But in the real world of American politics, you know and the way the media covers these things, the way the ads were out there, did John Kerry wait too long to try to get his arms around...

CORZINE: I don't think so, because I actually trust the judgment of the American people to sort through the facts when they're made aware of them, when they hear that people are denying things that they even supported. You got one guy that got a Bronze Star is claiming that there were no bullets flying, but he got a Bronze Star because of it. I don't think once they know this, they're going to be believers of this kind of negative smear politics.

WOODRUFF: But even if those ads are not true -- let me just cite to you one question in our poll. A few weeks ago before the ads ran, people were asked who'd be a more strong and decisive leader. George Bush had a 10-point lead. Now, he's got a 20-point lead -- who'd be a strong and decisive, and honest and trustworthy. The president has turned that one around, as well.

CORZINE: Judy, I think that smear politics, unchallenged, ultimately if they're unchallenged actually work. But this has been challenged. It's very clear that people were not stating the truth, and I think that will reverberate against those people that have used that for their benefit.

And in my view, it's pretty clear that there's a close tie with either Bush supporters or people that are even inside the Bush campaign associated with these ads. I think it's going to backfire on them.

WOODRUFF: You don't think John Kerry's missed an opportunity to get the subject on to something else?

CORZINE: Well, I think John Kerry was trying to stay on healthcare and jobs and things that are important...

WOODRUFF: By not addressing it?

CORZINE: ... by not addressing it. And I think, you know, he has now taken it on full charge. And now, I think it's time that the president be held accountable for the rising poverty rate in this country, the number of unemployed, the number of uninsured, and the declining real wages.

Those things make difference to these people right here. Middle class America is suffering seriously by the decline in their economic well-being. And John Kerry's got a plan on health insurance. He's talking about bringing jobs back home, not shipping them offshore. And he can create a lot of jobs by doing positive things with our tax system as opposed to what President Bush has.

WOODRUFF: Senator Jon Corzine, we appreciate you joining us.

CORZINE: Good. Good to be here.

WOODRUFF: We appreciate it. Good to see you. Thanks very much.

Well, as New York City braces for a Republican infusion, you might call it, one of the Big Apple's more colorful political characters weighs in on what's about to happen. Coming up, I go one- on-one with former New York Mayor Ed Koch, who reveals who he'll vote for this November and beyond.

(COMMERCIAL BREAK)

WOODRUFF: We are here in New York and a lot of press people are in New York, but it remains to be seen how the predominantly Democratic city will take to being overrun with Republicans for the better part of a week. Former New York Mayor Ed Koch has two words of advice for New Yorkers: be nice.

I took a stroll with Ed Koch yesterday in Strawberry Fields right here in Central Park.

(BEGIN VIDEOTAPE)

WOODRUFF: New York is the quintessential Democratic city. Is this place ready for the Republicans?

KOCH: Well, I've been around town and I have sent the message out, the Republicans are coming, be nice. And then I explained why. Because I want those delegates to go back to their homes and say they had the best time of their lives. And then, when we come knocking on their doors in Washington, they'll remember that we were nice to them and we want them to be nice to us.

WOODRUFF: All right. The other way around, how are the Republicans going to take to New York? I mean, you already have the majority leader of the House of Representatives, Tom DeLay, talking about staying on a cruise ship. They put that idea behind them.

KOCH: They stopped that. That was a mistake on their part. We told them they will have a wonderful time in New York. And they said, you're right, we trust you.

WOODRUFF: We're already hearing a lot, Mr. Mayor, about protests. Could those protests overshadow what's going on inside Madison Square Garden?

KOCH: I hope not. And I don't think so. We welcome protesters as long as they obey the law. They have rights, the rights include being able to have the people that you're protesting against hear you and see you, hear and see you, and that has been arranged down at Madison Square Garden. You don't have the light to engage in illegality.

WOODRUFF: You have already said you are going to vote for George W. Bush.

KOCH: Yes, I am. I don't agree with him on any domestic issues but I agree with him on the single overriding issue of fighting international terrorism. And I don't think the Democratic Party has the stomach to do it. And that's my decision and so I will be supporting George Bush.

WOODRUFF: What's wrong with John Kerry?

KOCH: Well, let me just say, you don't know where he's right or wrong because he changes so often, even on the issue of fighting international terrorism. When he was at the convention in Boston, he said he made a mistake in voting for the war. Then, he changes his views and he says that he would have voted for the war even if he knew there weren't weapons of mass destruction. So can you believe him? I don't.

WOODRUFF: Let me ask quickly about two headlines right now we're covering in this election. One is the whole controversy over John Kerry's record in Vietnam. Have the critics gone overboard attacking him on that?

KOCH: Absolutely. I don't think that record should be questioned. He is, in my judgment, a war hero. But what has that got to do with the election? What's more important is what did he do for 19 years in the United States Senate?

But there is no basis for questioning either Kerry's war record, or Bush's war record. It's an outrage that anybody does.

WOODRUFF: Second headline today is yesterday the vice president, Dick Cheney, said that he disagrees with the president on the issue of whether there should be a constitutional amendment banning gay marriage. Who's right, Vice President Cheney or President Bush?

KOCH: There is no question there should be the right for same sex marriage. And what is interesting about John Kerry more than the vice president, is Cheney wants to protect the right as he should, he's a father. But John Kerry, when he's in Massachusetts, he says he's against a constitutional state amendment.

And I'm certainly against that amendment. But then he goes Missouri, where 70 percent of the people voted for a constitutional amendment banning same sex marriage. And he says if he were living in Missouri, he would have voted the same way. That's an outrage.

WOODRUFF: But in terms of Cheney or Bush, you agree with Vice President Cheney?

KOCH: Absolutely. And I don't believe there should be a state amendment that carries, I believe that the right of marriage should transcend, whether it's opposite sex or single-sex, same sex.

WOODRUFF: Last quick question. Two prominent New York Republicans are already being talked about for president in '08, Governor George Pataki, former Mayor Rudy Giuliani. What do you think about all that?

KOCH: I'm not for either of them, I'm for Hillary in 2008.

(END VIDEOTAPE)

WOODRUFF: Lest there be any confusion, he's talking about the junior senator from the state of New York, Hillary Clinton. INSIDE POLITICS continues in just a moment.

(COMMERCIAL BREAK)

(STOCK MARKET REPORT) WOODRUFF: That's it for this INSIDE POLITICS edition from Central Park. I'm Judy Woodruff, live from the heart of New York City. Be sure to join us again tomorrow. CNN's Election Express Bus and I will be at the Chelsea Piers along the Hudson River. Have a good evening. "CROSSFIRE" starts right now.

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