<i>FTN</i> Transcript - March 25

BOB SCHIEFFER: Today on Face the Nation, Senator John McCain on campaign finance reform and a debate on the environment.

The Senate's in the midst of its debate on campaign finance reform, but can it pass a bill that President Bush won't veto? We'll ask the driving force behind reform, Senator John McCain of Arizona.

Then we'll turn to the environment. Is there an energy crisis? Should there be drilling in the Arctic? We'll get two sides, from Republican Senator Frank Murkowski of Alaska and Democratic Senator John Kerry of Massachusetts.

Gloria Borger is here, and I'll have a final word on real debate.

But first, Senator John McCain on Face the Nation. And joining us in the studio, Senator John McCain.

Well, Senator, let's get right to it. You've had a week of debate; you've fought of some amendments that could have killed this legislation. At this point - and you're about halfway there - Do you think you're going to be able to pass a ban on soft money?

SEN. JOHN McCAIN, R-AZ: I don't know, Bob. I think we've got some tough issues coming up, particularly this issue of "severability."

By the way, "severability" is French for "kill campaign finance reform."

SCHIEFFER: And what that means is that what some of the opponents are trying to do is put an amendment on here that, if one part of this bill should be declared unconstitutional, the whole thing dies.

MCCAIN: Which is almost never done. It's almost never done, only like a handful of bills in the last 10 years.

But there are some constitutional questions about this legislation, as there is with almost any complex set of legislation. So that's going to be a tough one.

Coming together on the hard money. The hard money is the increase in the thousand-dollar contribution limit, which was set in 1974. And on that one, very quickly, $1,000 today is not what it was in 1974. The question is, do you go so high that hard money replaces soft money? The soft money being the unregulated contributions. And a lot of the Democrats, a lot of Republicans, are very nervous about that.

So, I'm not sure. I'm heartened by the level of the debate; the illuminating the issues, the way that it's been conducted. I'm very pleased at the comity that - C-O-M-I-T-Y - that has existed between both sides, including Senator McConnell. I think he's been very good on this issue. Senator Dodd's done very well, too. And my partner in crime, of course, Senator Feingold, I'm proud of.

But we'll have to see. I think the tough votes will be coming up on Tuesday or Wednesday.

SCHIEFFER: Well, let's talk about that, this business of would - are you amenable to raising the $1,000 limit on contributions that an individual can give?

MCCAIN: I am amenable to raising it, and I think the majority are. The question is: Where is that happy balance where you don't lose people on either side

SCHIEFFER: Would you give us a number this morning?

MCCAIN: No. I can't, because I'm trying to bring people together, and so I would be the last person to take a position. I'm trying to get all these - Senator Wellstone, who I admire and respect, thinks we should have no money, and then there's others who think that $10,000 $20,000, or unlimited amounts of money.

So, we've got to narrow the differences here. I think we can. But it's not going to be easy.

GLORIA BORGER, U.S. News & World Report: Senator Daschle, the Democratic leader, says that he won't go as high as $3,000. So are you realistically looking at a $2,000 limit for ...

MCCAIN: No, but what we're also looking at - I don't know where we are, Gloria.

BORGER: OK.

MCCAIN: I can't tell you exactly. But I do say there are things we can do in addition to just the individual - in other words, we could allow people to spend more hard money in a segregated account that would allow the parties more strength, for example, to build a building, or to buy computers or something like that.

We want to do whatever we can to help strengthen the parties in increasing some hard money areas.

But, look, it's not going to be easy, but I don't see why that alone - that one issue alone - should stand in the path of campaign finance reform.

BORGER: Well, there's also the issue not only about raising just the $1,000 limit, but there's an aggregate limit that individuals can give as a total amount to parties as well as to candidates, and that's $25,000. Your bill raises that to $30,000. Some people want to just take the cap off of that all together. Some people want to triple it to $75,000. Where do you stand on that?

MCCAIN: You are describing the problem. And as I say, you don't want to have such a huge aggregate that it makes it meaningless, in other words as to so much money.

So what we need to do, I believe, we have narrowed the gap somewhat. Senator Feinstein has a proposal that I think has some merit. There's all kinds of - we've got now about 10 different proposals. We're going all put them down on a piece of paper, and then we're going to try to negotiate. I think we can, but I don't underestimate the difficulty here.

SCHIEFFER: Now Senator, another important amendment that will be offered this week is Senator Hagel's. And that is to put a limit on the amount of soft money, not to eliminate it. Does that have the support to pass at this point, do you think?

MCCAIN: I don't think so. There's a lot of fluidity associated with all these issues. But, you know, one of my dearest friends in the world is Chuck Hagel, and we're friends now, we were friends before, and we'll be friends after, but I cannot accept legalizing soft money. That would be repealing the act we passed in 1907 that outlawed corporate contributions and in '47, outlawing union contributions.

So, I think what Chuck wants to do is strengthen the parties. I want to strengthen the parties, as well. The parties have become very weak. Parties now are just conduits for money to run negative ads. That's really unfortunately what they've turned into.

So, I think it's going to be a good debate on it, and I think we can beat it back. But we want to negotiate; we don't have a perfect bill. And by the way, this solution will not solve all problems. This is a beginning, not an end.

SCHIEFFER: Tom DeLay, the number-three Republican in the House said this morning on television that he will do whatever is necessary to defeat this bill when it gets to the House.

And I must say, he put out last week a fairly extraordinary press release about you. It says, "DeLay blasts McCain for allowing a group to launch soft money campaign in his Senate offices." Among the things he says in this is, "Senator McCain, you should be ashamed of yourself." He says you are a hypocrite, and he said you just should not ought to have done it. I mean, what's that all about?

MCCAIN: Frankly, I don't know, because, first of all, I would say, "Tom, chill out a little bit here, pal." We are in favor - we do everything we can to encourage issue advocacy. People want to believe in an issue, they should stand by it, and they should do everything they can to support it including raising money for it. We've always favored issue advocacy, that's what this is all about.

We have some people, including, by the way, some CEOs of major corporations that don't want to give soft money anymore. People like Warren Buffett, as well, by the way, who want this stopped. So, we have a group of people who are buying modest buy of some ads that are supporting our position. That's what democracy should be all about, so...

SCHIEFFER: What about the substance of his charge that this group is funded by soft money, and they're putting out ads to defeat soft money?

MCCAIN: It's funded by some people who I think if they want to put in some money for any cause or any issue they believe in. What we're talking about is limiting the money in political campaigns the last 60 days, by the way - that mention the candidate's name or their likeness.

Again, read the legislation.

SCHIEFFER: I must say, I do find it unusual that someone in your own party would call you a hypocrite or say you should be ashamed of yourself. That is kind of unusual.

MCCAIN: It's unusual, but he's done that before. It's just one of these things that you have to understand is going to happen.

Bob, we are threatening the system that keeps these people in power. We are threatening incumbency. That's why 95 percent of the incumbents who have been elected - we are threatening the special interests. Have no doubt what is at stake here. So you can probably predict more of this kind of hysteria as we come closer t passage.

BORGER: Do you think you can get the votes to beat Tom DeLay in the House?

MCCAIN: Well, they did twice already, as you know, with the so-called Shays-Meehan legislation. I think the bill can pass the House.

BORGER: As long as we're talking about some people who are not good friends of yours, let's talk a moment about the White House. Because recently there has been a spate of stories about the bad blood between McCain and Bush and between the staffs of McCain and the president.

And I'm wondering - the White House is saying essentially you're throwing monkey wrenches into all of their plans to control the Congressional agenda, that you've gone off on your own, on not only campaign finance reform but on HMO reform. How do you respond to that?

MCCAIN: Well, first of all, I have very good relations. Dick Cheney and I have known each other and been friends for many years. We met the week before last. Colin Powell and I are the closest of friends. The president and I have a cordial relationship.

Look, there is always going to be bad blood when there is a tough campaign. But there certainly isn't between me and the president or anybody else associated with him, nor with the majority of my people.

People put their heart and soul into a campaign; obviously, it takes some time to get over. But my relations with them are good. I want to work with them.

And finally, specifically on those issues you mentioned, those are the issues that I not only campaigned on, but were involved in last year and the year before and the year before. I first joined with Russ Feingold six years ago. I first was with Senator David Born in 1987 on campaign finance reform. I've been working on patients' bill of rights reform for several years. I mean, so it's not as if I just sort of invented these issues. I've been involved on work on them for a long time. And I want to work with the White House.

SCHIEFFER: Do you feel though - I mean, because here's the - the White House is concerned enough about this story that officials there called me this morning and said they wanted to point out that the campaign finance proposals the president put out were given to you privately before they were given to the public or to other senators. They say that you have been meeting privately with Mr. Cheney. That their personnel chief met privately with you on Friday about some appointments, even pointed out that Laura Bush has complimented you in recent speeches. The word they send to me is, "We think John McCain is our ally." Do you feel that way?

MCCAIN: Absolutely.

SCHIEFFER: Is this somehow - is this sort of a disagreement between one part of the White House, and you get along with the other part? It's kind of hard to figure this out if you're just looking at it as an observer.

MCCAIN: Well, it's a little hard to figure out. But I'm an ally of President ush on Social Security reform, on reform of the military, on cleaning up the tax code. I mean, there's a long laundry list of issues, including all these telecommunications issues, that I'm an ally of the White House on.

Because I've been working on an HMO patients' bill of rights and we don't have an agreement on that, I believe we can come to agreement. By the way, specifically on campaign finance reform, as you mentioned earlier, the president specifically said I'd like to have a bill I can sign. I think we can work that out.

BORGER: Very quickly, would you rule out challenging President Bush?

MCCAIN: Absolutely. Yes.

SCHIEFFER: Would you rule out running as an Independent next time?

MCCAIN: Yes, I envision no scenario - I have no contemplation of such a thing.

SCHIEFFER: If nominated, you would not accept? I mean, and all that?

MCCAIN: I cannot imagine that scenario, Bob. I just - here we are in the early days of a Bush administration. My job is to work with him for the good of the country, and I want to do that.

But that doesn't mean that I somehow abandon all the things I've stood for all those years. But I think we can come together on them.

SCHIEFFER: OK. Thank you very much, Senator.

MCCAIN: Thank you.

SCHIEFFER: Good luck in the coming week.

When we come back, we're going to debate how to solve the nation's energy problems. When we come back.

(COMMERCIAL BREAK)

SCHIEFFER: And with us now from Denver, Colorado, Senator John Kerry, senator from Massachusetts, Democrat of course. Here in our studio, Senate Energy Committee Chairman Frank Murkowski.

Welcome to the broadcast, Senator. Well, Senator, we've been hearing the White House talk a lot about an energy crisis. Are we in an energy crisis?

SEN. FRANK MURKOWSKI, R-AK: Absolutely. One looks at California, you know there's something going on out there that's real. They've become using more energy than they've been producing, and that worked for a while as long as there was outside energy to bring into California. But when that became scarce, the price began to go up, the utilities are bankrupt.

What we've seen in California is an inconsistency in the deregulation process, because they haven't passed on the high price of this additional energy on to the consumers. And as a consequence, there's no incentive to save because there's no reduction. You know, it's been high prices on the wholesale but not the retail. You can't have a situation like that very long.

SCHIEFFER: OK, let's go to Senator Kerry because, Senator Kerry, you have said this week that the administration is talking up an energy crisis just because they're looking for an excuse to drill oil wells. Explain yourself.

SEN. JOHN KERRY, D-MA: Well, Bob, we have a challenge with respect to energy. It may become a crisis if we don't responto it properly.

But the response of the administration is the traditional response of the Republican Party whenever energy supplies become short. They try to drill in the Arctic Refuge or they try to drill in areas of monuments. They don't do the things that most people believe we should have done for a long period of time, which is energy efficiency, energy conservation, alternative energy fuels and moving us away from this dependency.

You know, we were 30 percent dependent on foreign oil in the 1970s when we had our, quote, "crisis." We moved to about 50 percent dependent-plus in the 1990s, and we're going to be over 60 percent dependent in the next few years.

Even if you were to open up the Arctic Refuge, you will do nothing to reduce the cost of oil to Americans. You will do nothing to reduce the dependency on foreign oil. We need to move to a whole new energy supply structure in this country, and we need to do it now. And I want to have a real discussion about our energy choices.

BORGER: Senator Murkowski, obviously you do want to drill in the Arctic Refuge, Senator Kerry does not. Tell us why you think it is going to reduce our dependence on foreign oil.

MURKOWSKI: Well, let's go back to Senator Kerry's point. In 1973 when we had the Arab oil embargo, we had lines around the block in this country. People were indignant; they were outraged. At that time we brought on Prudo Bay. Prudo Bay has been supplying this nation with about 20 to 25 percent of its crude oil for the last 27 years.

Now, it's believed that the range of reserves in ANWR are somewhere between 5.6 and 16 billion barrels. If it's 16 billion barrels, it would replace what we're dependent on Saudi Arabia for a period of 30 years. It's that significant. It would be the largest oil field found in the last 40 years in the world. So we're talking about a significant amount, and it could be brought on in three and a half years.

And to suggest it's a six-month supply, which Senator Kerry and others have said, that's assuming all the rest of the crude oil production stopped for six months. Well, that's totally unrealistic.

This has become political issue for the Democrats and for those that followed, if you will, Al Gore's environmental bent. And we're seeing this division between Senator Kerry and Senator Lieberman.

SCHIEFFER: Senator Kerry, isn't it also true in fact that the technology has become very good and that all of these dangers that people used to talk about, drilling in places like the wildlife reserve, that's been reduced substantially, has it not?

KERRY: Absolutely. We're doing a much better job, but that's not the issue here. I mean, first of all, we have things like 3D, three-dimensional seismic capacity now. We have an extraordinary ability to discern where there are oil beds, reserves. We are much more efficient with horizontal drilling and other things, at being able to exract oil in ways we didn't. In fact, much of our supply has come because wells that we used to think were empty - reservoirs that were empty - we're able to now get not 50 percent, but 70 percent out of it because of the increased technology.

But none of that addresses the fundamental question for our country. I mean, Frank just talked about 16 billion. The amount of oil that would come conceivably out of the Arctic Refuge depends, really, on the price of oil. I mean, we have 30 trillion cubic feet of natural gas up at Prudo Bay in the Alaska area now that they're not drilling because of price. It's not economical to do it.

The drilling of oil has always been driven by economics, and when the oil price is such as it was a number of years ago at $10 a barrel, nobody was drilling. That's one of the reasons we have a problem today.

In California, only 1 percent of the entire electricity grid of California comes from oil. They're trying to sell the notion that this is going to address California. It doesn't address California. California has nine new plants coming on now. It has 14 that are in the approval process, another 10 that are about to be approved under expedited process. And we're going to see an enormous new increase, but it's not going to be oil-dependent.

So it's completely fraudulent to suggest that America's dependency on oil, its price, is going to be addressed by drilling in an Arctic refuge.

SCHIEFFER: OK. Gloria?

BORGER: Senator, House Republicans this week passed a budget that did not include money for drilling in the ANWR. Doesn't that mean that it's dead?

MURKOWSKI: No, it's in the Republican energy bill, which has been introduced. It's in the administration's energy task force.

And if you look at this issue, there are about four questions that have to be answered. Can it be done safely? Obviously, we have the technology to do it.

You know, they misrepresent the size of the area. This area is the size of the state of South Carolina. We're talking about a sliver. A million and a half acres out of 19 million acres. If the oil is there, the footprint is 2,000 acres.

We're talking the issue of the economy. What effect has the high price of oil had on the economy? Look at the fourth-quarter earnings of the Fortune 500? Oil's a part of that.

And then, we're talking about the national security, because we fought a war over there. We lost 147 lives. One Congressman said I'd rather drill in a cemetery than have my grandsons' bodies come back in body bags. Now, that's the harsh reality.

And the last issue is: What do Alaskans want? This is our state, you know. We approve it 75 percent, because we know that we can do it safely. And there are people that live in ANWR. It's not an untouched area. There's a village of Kaktovik, 127 people. They have something to say about it, too. And they support it.

SCHIEFFER: Senator, do you think t this point you have the votes in the Senate to pass this?

MURKOWSKI: It's a close vote, but I think we have to consider the national security interests of this country. Do we want to fight another war over oil? We fought one once. How quickly we forget.

KERRY: Bob, please, can I...

MURKOWSKI: We're bringing in oil from Saddam Hussein now. We're bringing in 750,000 barrels a day. We enforce the no-fly zone, and, you know, this is where we're at. We bomb him, and he uses his money to develop a missile capability and aims it at Israel.

(CROSSTALK)

SCHIEFFER: Let's see what Senator Kerry wants to say.

MURKOWSKI: All right. Let's see what he says.

SCHIEFFER: He wants to respond here.

Go ahead, Senator.

KERRY: Bob, may I say, look, I understand Frank is trying to represent Alaska, and I'm very sympathetic to the parochial concerns of Alaskans. I would rather see us try to provide help to Alaskans and to his citizens to make up for some of the revenues they might lose.

But to suggest, politely, I say, to suggest to any American that drilling in the national refuge is going to affect our national security so that we would not be dependent on oil from abroad is absolutely deceptive. It might at most, if you took his best prognosis, mean a difference of 2 to 3 percent of our total supply, only for a short period of time.

To say - we would have fought the war in the Gulf no matter what. And we would fight another war no matter what because of the extraordinary global consequences.
That is just the most specious argument I've ever heard.

Secondly; to suggest that we don't have alternatives. Just with buildings efficiency, with changing the codes on how we build in America, we can save the exact amount of fuel we bring out of Alaska. Just by raising the standards of emissions on our SUVs, which are out of control, we could save more than the amount of oil we might bring out of Alaska.

In my lifetime, we are going to see a transition to alternative hydrogen fuel cells, hybrid automobiles. People can get 80 miles to the gallon if we simply implement the incentives for people to do so. And that's where our energy policy ought to go, not drilling in a national Arctic refuge where we have...

SCHIEFFER: I've got to - Senator, I'm going to interrupt, because...

KERRY: I'm sorry.

SCHIEFFER: I'm going to let Senator Murkowski have 30 seconds to answer.

MURKOWSKI: Well, you know, I don't know why I have to continually, if you will, account for my knowledge of the area in my state, while opponents like Senator Kerry have never been there, and they won't go there. We have another trip this weekend to take senators up.

You know, we have this technology, and we have the oil, and we've been supplying this nation with 25 percent of this oil from Prudo Bay. That's declining.

We've got a great opporunity. Charity begins at home in this country, and we have the American spirit to do it right.

SCHIEFFER: All right. Thank you both, Senators. A very enlightening discussion this morning.

Back in a minute with a final word.

(COMMERCIAL BREAK)

SCHIEFFER: Finally today, I tried to get the Evening News to do a story last week about how the Senate was having a real debate, that being the one on campaign finance reform. Well, I kept getting turned down and then I understood why.

Like most people, the editors in New York assumed the Senate has real debates all the time.

I have a scoop for you: The Senate hardly ever has a real debate. You can usually tell how a senator is going to vote by checking who contributed to his or her campaign. By the time issues get to the Senate floor, everything has been worked out, all sides generally know how the vote is going to end up. And debate, if you want to call it that, usually amounts to no more than senators reading speeches written by someone else to an empty Senate chamber. The key word here is "boring."

Well, that's until last week. Republican leaders have always blocked campaign finance reform from coming to a final vote. But in a Senate divided 50-50, that's no longer possible. So with a filibuster no longer a question, individual amendments are being debated and voted on. And no one knows which amendments will be considered until they're introduced on the floor. So the debate has been spontaneous and compromises are being struck and legislation is being written well, like it's usually portrayed in the movies.

What has surprised the senators is that they love it. It has been so long since they've had a real debate, they had forgotten how much fun it can be. I'm with them. I don't know how this one is going to come out, but campaign finance is finally getting the airing it deserved, and the Senate has never looked better.

That's it for us. We'll see you here next week on Face The Nation.

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