Transcript: <i>FTN</i> on Feb. 6

Bob Schieffer: Today on Face The Nation, Rudy Giuliani tells why he`d be a better senator than Hillary Clinton. And George Bush`s top strategist talks about getting that campaign back on track.

This afternoon, Hillary Clinton officially launches her race for the New York Senate. Can she convince New Yorkers she`s one of them? What other issues will define this race? We`ll ask Mrs. Clinton`s likely opponent: Rudy Giuliani.

Then we`ll turn to the other big story in politics: What next for Bush, after the New Hampshire drubbing? We`ll ask his top campaign adviser, Karl Rove.

Then we`ll talk about all of it with a top fundraisers for Senate candidates: Democrat Robert Torricelli and Republican Mitch McConnell.

Gloria Borger will be here, and I`ll have a final word on political experts.

But first, Mayor Rudy Giuliani on Face The Nation.

Announcer: Face The Nation, with chief Washington correspondent Bob Schieffer. And now from CBS NEWS in Washington, Bob Schieffer.

Schieffer: Good morning again, and we begin this morning with the mayor of the Big Apple, Mayor Rudy Giuliani of New York.. Mr. Mayor, thank you for coming.

Mayor Rudy Giuliani, R-New York City: Good morning, Bob.

Schieffer: Mrs. Clinton`s campaign manager said Friday that the fact that she is not from New York will prove to be a minor matter. What do you say to that?

Giuliani: (laughter) Well, I don`t know. I am from New York. I was born here. I was born in Brooklyn. I`ve been the United States attorney, the mayor of New York City, and I have a record of success on issues that are very, very important. So, you know, from my point of view, I think that`s what the campaign should be about. It should be about ideas and it should be about your record, where you`ve had a chance to put your ideas into practice.

But we`ll see. I mean, everybody has their own impression. It seems to me that what their idea of the campaign is, sort of, like a remake of image -- to emphasize image. From my point of view, this campaign is about 540,000 fewer people on welfare, 360,000 new jobs in New York City, taking New York City from one of the largest crime cities in the country to the safest large city in the United States, and then trying to do that for the rest of the state of New York; from a philosophy that`s a proven one and a record of performance. That`s the way I think you should run for public office. But everybody has a right to run the way they want to run.

Schieffer: You know, I was thinking, when Mrs. Clinton began thinking about running for office, that back when Senator Kennedy first ran, his first race, his brother was the president, and he just ran on the slogan of, he can do more for Massachusetts.

I`m wondering, of course, Mrs. Clinton`s husband is going out of office, but the fact that she is a national figure and has someting of a national following, is it possible she could do more for New York than you could?

Giuliani: (laughter) Well, I think I`ve already done things -- I mean, I guess the difference is, I`ve already done things for New York with 20 years of public service. And I`ve taken a city that was considered to be the most ungovernable in the country and turned it into one of the best large cities in the country, now on the front page of "Time" magazine as a city in renaissance. I came into office, we were on the front page of "Time" magazine as the rotting apple.

So, in the same way as I`ve had very, very strong results as the mayor of New York City, or as United States attorney when I was here for five years as the United States attorney, or six years as an assistant United States attorney, my record of success comes out of my knowledge, experience, background and life experience as a lifetime resident of the state. And I`ve had some, you know, some fair success.

You might ask the following question: How is it that the Democratic Party can`t come up with a candidate for the Senate from the state of New York? What does that say about the Democratic Party? So there are a lot of ways to look at this.

Gloria Borger, U.S. News & World Report: Mr. Mayor, I notice that when you talk about this campaign, though, you refer to the Clintons as a plural. Does this mean that you subscribe to what Bill Clinton once said, which is that you -- if you -- you know, you buy one, you get one free?

Giuliani: No, I don`t know. You know, I`ve read the article in "The National Observer" -- "New York Observer" last week that the White House was running the campaign. So maybe I`m taking that article too seriously.

Schieffer: Is that good or bad?

Giuliani: I think that Hillary Rodham Clinton will run, she`ll set forth her viewpoints. From my point of view, that isn`t my real concern. My real concern is trying to explain to the people of New York State how I can take the kind of turn-around that we`ve created in New York City, where we`ve gone from losing a tremendous number of jobs in the three years before I came into office to 360,000 -- 380,000 new jobs; to convince the people of the state that that same kind of leadership, that same kind of approach can work for the entire state. That`s my job.

Borger: Mr. Mayor, let`s talk about some issues. There are a lot of issues...

Giuliani: That`s what I was just talking.

Borger: Well, that`s right. Other issues. There are a lot of issues that you and Mrs. Clinton actually agree on. You were both for welfare reform, you both support abortion rights, gun control. Where do you really disagree?

Giuliani: Well, I guess we could start with taxes. I think that one of the ways in which New York could get back a lot of that $15 billion deficit that Senator Moynihan has pointed out now for 10 or 15 yeas -- and arguably it`s gotten a little bit worse. One of the ways we could get back the $15 billion more we`re sending to Washington than New York gets back from Washington -- including all of upstate New York -- is to lower some taxes. Some critical tax reductions would help return a lot of that money to us.

Giuliani: Income tax reduction, capital gains reduction. There`s a big difference there.

I suspect that there`s an essential difference in the way this in which we look at government. One point of view is government solutions for problems large, government programs. My idea is more, you use government last and you first do things like we`ve done with welfare where we have 540,000 fewer people on welfare. We now substitute a job for government programs and we`ve turned around welfare more than any other place in the country.

Those are ideas that I could bring with me to the Senate and that I would fight for. And I think it shows us somewhat or maybe a very, very different approach as between big government, more government or maybe a more human, people-oriented strategy which is, let`s see if we can increase ethic. Let`s see if we can replace dependency with self- sufficiency. Let`s see if we can increase the influence of the private sector including the charitable and religious sectors in helping with the problem of the homeless. So I think it`s a different approach. And people have a stark choice here.

Schieffer: Mr. Mayor, let me ask you about some of these fundraising letters that your supporters are sending out. These things are pretty nasty. I mean, one of them says that Mrs. Clinton is far more liberal than her husband and possibly more corrupt. There have been all sorts of charges. Isn`t that a bit over the top?

Giuliani: But I didn`t send out those letters. You could just as easily have pulled out the letters from the other side that describe me as part of the vast right-wing conspiracy.

Schieffer: But you can`t -- may I just interrupt you? You can`t disassociate yourself or escape all responsibility just by saying, I didn`t send it out. I mean, did you know they were coming...

Giuliani: No.

Schieffer: Could you have told them to stop?

Giuliani: No, no, no and no. Those are groups that are raising money on their own and using what they regard as Mrs. Clinton`s bad image, what they would see that way to raise money. There are groups on the other side -- on the extreme left-wing side that are doing the precisely the same thing, calling me things like Nazi and other names like that -- fascist -- and they raise money for their group that way.

Schieffer: But wouldn`t it be a good thing if you told them to stop?

Giuliani: OK.

Schieffer: If both sides told them to stop.

Giuliani: Yes, I will tell them, Bob, I`ll tell them to stop and then, you know, they`re going to go ahead anway because this is the way they raise money. They demonize people. They demonize me, they demonize the president, they demonize her. They demonized President Bush before that. It`s unfortunate that people do that on the extremes of politics.

Now, my fund-raising -- 90,000 different people, I think a record for a Senate campaign so far -- the average contribution is $108 from 90,000 different people which shows a tremendous broad base of support. And, you know, they include people that are part of the vast right-wing conspiracy like Colin Powell and Bette Midler. So, come on. This is, unfortunately, the reality when people get off on either extreme.

I`ve been a moderate. I continue to be. I`ve been a mayor who`s tried to find the right solutions to problems and stay away from all these "isms" of one kind or another, and people do what they want.

Schieffer: All right, Mr. Mayor, I`m sorry, I have a lot more questions but we have to stop there.

Giuliani: Thank you.

Schieffer: Thank you very much. Hope to see you again.

Giuliani: Absolutely.

Schieffer: Well, now let`s turn to that other big story in politics this week and that is the presidential campaign. Joining us from Austin, Texas, Karl Rove. Many of you may not know Mr. Rove. He is very well known in political circles. He is the chief campaign strategist for Governor George W. Bush. He joins us this morning.
And I must say Mr. Rove, a big surprise in New Hampshire. You cannot be happy or satisfied with what happened there. It looks like a close race. Your man got kicked pretty good. What happens now? What do you do different?

Karl Rove, George W. Bush Campaign Chief Strategist: Well, we go to Delaware on Tuesday, and we then turn our full attention to South Carolina which is on the 19th. And we`ve got to show that Governor Bush can pick himself off the mat, dust off the blood and go in there and fight hard for this nomination.

Schieffer: Well, are you going to take a different tack? Will you go in a different direction? Will you concentrate on something you didn`t concentrate on in New Hampshire? Or what do you plan to do here?
Rove: Well, first of all, we do not intend to make the mistake we made in New Hampshire of letting the negative attacks by Senator McCain go unanswered. He ran two very powerful television ads in New Hampshire; one alleging that we were unqualified to be president -- Governor Bush was, and the second was alleging that Governor Bush spend all the surplus on tax cut and saved nothing for Social Security.

We`re going to respond strongly to those kinds of attacks by Senator McCain. We have an ad up in South Carolina. He`s running the same ad in South Carolina on Social Security and taxes, and we`re going to rebut those kinds of charges.

Second of all, we`re going to show the distinctions between these two men. Governor Bush is a succssful governor of a big state who has pursued and enacted into law a reform agenda for education, welfare, civil justice, juvenile justice and tax cuts. Senator McCain is a 17-year Washington insider whose accomplishments are few and far between.

They also have very serious disagreements upon issues like taxes and the defense budget. And we`re going to -- and campaign finance, and we`re going to point these out.

Schieffer: Let me ask you one other thing. Governor Bush arrived in South Carolina last week. One of the first things he did was roll out an opponent of Senator McCain who criticized Senator McCain`s record on dealing with veterans` issues. Why in the world would you think it`s a good idea to attack Senator McCain on that subject, of all things?

Rove: Look, what we did was accept the endorsement of three of the four living Medal of Honor winners in South Carolina, former chairman of the joint chiefs of staff, and a large number of veterans` leaders. South Carolina is the only state in the union where they elect their adjutant general, and he`s a supporter of ours.

Governor Bush is strongly supported by a large number of veterans for a very simple reason. They believe that he`s better qualified to be president of the United States and he`s got a more thoughtful approach to strengthening the military.

I would remind you, there`s a big difference between the two candidates. Governor Bush laid out a very thoughtful program to modernize America`s military, and it calls for increasing the defense budget. Senator McCain believes that we ought to strengthen the military, but that no overall increase is needed in the defense budget. That`s simply wrong. In order to strengthen America`s military we need to strengthen the defense budget. And that`s what`s won us the support of veterans...

(CROSSTALK)

Schieffer: But the man that was on the stage with Governor Bush attacked Senator McCain`s record in dealing with veterans. And as a result of that, five senators -- four of them Democrats, one of them a Republican, all of them Vietnam vets -- said that it was not only inappropriate but malicious and distorting of Senator McCain`s record. They called on Governor Bush to apologize and disassociate himself from that. Do you think -- do you stand by what that fellow said?

Rove: Look, this veteran obviously has strong feelings about how Senator McCain has dealt with the POW-MIA families and how he`s dealt with issues such as Agent Orange. He`s entitled to his opinion. He endorsed Governor Bush because he feels Governor Bush would make a better president.

Schieffer: Well, does Governor Bush endorse him though? That`s what I`m asking.

Rove: Well, look, Governor Bush has outlined his views and values and prospects. And I`m certain that Senator McCain wouldn`t be thrilled to have the endorsement of four Democratic U.S. senators, as they did in that letter

But, look, Governor Bush has drawn the support of veterans in South Carolina because he`s strong on national defense and because there`s a big difference between the two candidates. One believes there ought to be an overall increase in the defense budget and the other candidate, Senator McCain, says he does not believe that we need to increase the defense budget. That matters a lot to veterans.

Schieffer: Yes, I don`t want the whole interview to be about this one subject. But I take it from what you`re saying, you`re not in any way shape or form apologizing for what that fellow said or disassociating Governor Bush from his remarks.

Rove: Those are his views; they`re not Governor Bush`s necessarily. But they`re his views, and that`s why he chose to endorse Governor Bush.

Borger: Mr. Rove, it`s also clear that now your campaign really wants to show that John McCain is a powerful chairman of the Senate Commerce Committee who takes money from the very special interests that he assails. Is this your campaign`s way of calling John McCain a hypocrite?

Rove: No, it`s to point out that he says one thing and does another.

Borger: Well, isn`t that a hypocrite?

Rove: Well, it`s your choice of words. I wouldn`t use that word. Senator McCain sees himself and portrays himself as an advocate of campaign finance reform, as somebody who is cleaner than anyone else around the table, and yet he has accepted contributions and sought contributions from people with legislation pending before his committee.

He had a -- he wrote letters on behalf of powerful interests right after they raised him money. He flies on airplanes -- corporate airplanes and sees nothing wrong with doing so. He`s the only candidate in this race to have accepted a $2 million contribution. He took $2 million raised for his Senate campaign and transferred it over to his presidential campaign.

He benefits from the current, sort of, insider way that we handle campaign finance laws in America. And he sees nothing wrong with it. Yesterday he defended the practice of flying on corporate aircraft to people with business before his committee.

Borger: Well, you also say that he is the insider, but your candidate is the one who was endorsed by 27 Republican governors, 37 senators and 175 members of the House. How can you be the outsider?

Rove: Because Governor Bush is a successful governor of a big state, Texas, and these people have endorsed him, especially his colleagues, because they know that he can bring about the changes that Washington needs.

Senator McCain has been there for 17 years. He cannot create a consensus. He cannot lead people and persuade them to back his agenda program. He`s failed at that.

Governor Bush has demonstrated in Texas that he can bring Democrats and Republicans together to reform education, cut taxes, change welfare, change juvenile justic laws. People appreciate that. They want that for our country, and that`s why he`s drawn the support of these people.

Look, it`s really an interesting point you just made. Colleagues of Senator McCain know Senator McCain and have taken the time to get to know Governor Bush and yet they have endorsed Governor Bush over their colleague. That`s a powerful message about their desire for change and for effective leadership and to win back the White House. And Governor Bush`s message can unite the country, unite the party and win the White House. That`s why so many of these colleagues of Senator McCain have chosen to endorse
Governor Bush.

Schieffer: And that is where we have to leave it. Mr. Rove, thank you very much for being with us.

Rove: Thank you, sir.

Schieffer: We`ll be back in a minute to talk to the heads of the Senate campaign committees about all of this. In a minute.

(COMMERCIAL BREAK)

Schieffer: With us now from New York City, Senator Robert Torricelli; from Louisville, Kentucky, Senator Mitch McConnell. They are the senators who are in charge of raising money for people thinking about running for the Senate from their respective parties.

But gentlemen, I want to ask you first a little bit about this situation down in South Carolina, where suddenly it looks like that John McCain is catching up to the front-runner, George Bush. What`s happened down there, Senator McConnell? I know Governor Bush is your guy.

Sen. Mitch McConnell, R-KY: Well, I think John ran a very good campaign in New Hampshire, and he won a very significant victory, and I think Governor Bush, obviously, has to turn it around in South Carolina, and I think the way to do that is to engage Senator McCain on a couple of things.

Number one, on John`s signature issue, campaign finance reform. He`s the guy who has gotten more of his campaign funds and his campaign for president from Washington lobbyists and special interests than anyone else.

Number two, he -- the last time in the Senate we had an opportunity to vote on what we call paycheck protection, that is a bill to prevent the labor bosses from taking the money of rank-and-file union members and spending it on causes that they might not agree with. Senator McCain voted with the labor bosses.

So I think you have to point out the difference between the rhetoric and the reality on campaign finance reform. And second, on the tax issue, just a year and a half ago, John was the principal proponent of a half-a-trillion dollar tax increase, most of which would have fallen on people making $30,000 and less. And now in -- awash with a $2 trillion non-Social Security surplus, John is recommending a tax cut that`s smaller than Bill Clinton`s.

So, I think pointing out the differences, Bob, on those two issues would be a good way for Governor Bush to begin to define the differences between the two candidates.

Schieffer:When you talk about a tax increase, you`re talking about a tax on cigarettes, that`s basically what you`re talking about.

McConnell: Well, sure. But I mean these are real people who -- 60 percent of that tax increase would have fallen on people making $30,000 and less.

Torricelli: Let me go to Senator Torricelli for a moment just to talk good the Democratic race a little bit. Bill Bradley says that he`s going to take this through March 7th, March 14th, maybe right to the convention. Is Bill Bradley right now in the process of dividing up the Democratic Party?

Sen. Robert Torricelli, D-NJ: I think that the principal burden, after the New Hampshire primary and the Iowa caucuses, is now on Bill Bradley. On March 7th, I would assume that he would win in our own region of the country in New York and Massachusetts, but I think he has to produce some victories elsewhere in the country, too -- Missouri or Georgia or Washington state.

Having campaign resources and an ambition to be president is not enough of a rationale to continue with this candidacy. I think in one of those -- several of those contests, he has to demonstrate some ability to win which he obviously has not done to date.

Borger: Are you saying, Senator Torricelli, that Senator Bradley should pull out?

Torricelli: No, I think that Bill Bradley has the sufficient support to take this race to March 7th. But I think that there is a burden now to demonstrate both an ability to win and establish a rationale for his candidacy.

Obviously, after a successful Democratic administration with President Clinton and Al Gore, Democrats, at the moment, feel united and at the moment there has not been a compelling interest to motivate Democratic primary voters to defeat Al Gore. That is just a simple reality.

Schieffer: Are you going to take sides, Senator Torricelli?

Torricelli: No, I haven`t. Both are friends. Senator Bradley being from my state, my being his successor in the Senate and now chairing the Campaign Committee, plus I haven`t seen enormous national demand for my opinion, I haven`t felt compelled to do so. But I do want to see this race fought out on positive issues and also come to a conclusion relatively soon.

The fact that there`s obviously now going to be an elongated, difficult and nasty Republican race, gives Democrats, I think, both an obligation and an opportunity to unite, and so quickly.

Schieffer: Senator, let me go quickly to Senator McConnell, because we do want to talk a little bit about that New York race. Will it help or hurt Hillary Clinton if Bill Clinton campaigns for her, Senator McConnell?

McConnell: Gosh, that`s hard to tell, Bob. I don`t know how the people of New York are going to feel about that. I think it`s one of the dilemmas. I assume she wants to take advantage of the administration in some ways and distance herself from it in othe ways. That will really be up to the people of New York to decide whether the relationship with the president`s an asset or a liability.

Schieffer: And Senator Torricelli, we have about 20 seconds here.

Torricelli: Not only do I think that the president will campaign with Mrs. Clinton, he should. What we need to demonstrate in this campaign is New York has an opportunity not available to any other state, and that has to have someone who can speak to and fight for issues like child care and education and access to health care, that indeed no other senator can really speak at the same level. I think the president can help demonstrate what an enormous opportunity this is for the people of New York.

Schieffer: All right, and we leave it there, gentlemen. Thank you so much, both of you. I`ll be back with a final word in just a second.

(COMMERCIAL BREAK)

Schieffer: Finally today, was it just a week ago that I was saying New Hampshire is a nice state where odd things happen? I wish I had remembered that the next day on the eve of the primary when I reported that late polls indicated it was going to be close between Bush and McCain and a run-away for Gore. If you just got here from Mars, that last part turned out to be exactly backwards.

Once again, New Hampshire voters reminded us that when it comes to forecasting, the experts are better at back-casting. Not so good for the experts, not all bad for the country, though.

The great thing about American politics is that just when we`ve got it all figured out, something happens to show us we didn`t quite get it right. And that`s the great strength of the system; as long as we can never know for certain what`s going to happen, it means the people are still running things.

When I was a young reporter, I was taught that anyone who had a nickel to buy a newspaper was entitled to be an expert on newspapers, at least for a day. I`ve always felt there was a parallel in politics. Anyone who takes the time to vote can rightly claim some expertise on politics.

So all of the experts weren`t wrong about New Hampshire; just some of us.

For continuing political coverage, visit our new Campaign 2000 and Face The Nation websites on cbs.com. That`s it from us. See you next week on Face The Nation.

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