FTN 1/26/03

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BOB SCHIEFFER, Chief Washington Correspondent: Today on Face the Nation, White House Chief of Staff Andy Card, and Senate Minority Leader Tom Daschle.

Will President Bush make the case for war with Iraq in his State of the Union speech on Tuesday, or will the administration give more time for inspections? And what can the president do about the flagging economy?

We'll ask Andrew Card, the White House chief of staff. Then we'll get the view of the Democrats from their leader in the Senate, Tom Daschle.

Amy Walter of the Cook Political Report will join in the questioning, and I'll have a final word on going to war.

But first, White House chief of staff, Andy Card.

ANNOUNCER: Face the Nation, with CBS News Chief Washington Correspondent, Bob Schieffer. And now from CBS News in Washington, Bob Schieffer.

SCHIEFFER: And good morning again. The White House chief of staff, Andrew Card, joins us here in the studio. Mr. Card, welcome. I want to get right to it.

The main thing we want to talk about this morning is the president's State of the Union message, and it seems to me if the president finds it necessary to go to war with Iraq that one of the main things he is going to have to lay out for the American people is whether there is a connection and what that connection is between Saddam Hussein and Osama bin Laden and the people that attacked us on 9/11.

Is he prepared to make that connection?

ANDREW CARD, White House Chief of Staff: Well, first of all, Saddam Hussein has a broader responsibility. The world has asked Saddam Hussein, in fact they've demanded that Saddam Hussein eliminate all of his weapons of mass destruction.

They started in 1991 with that request. It was a demand as a result of the Gulf War. Saddam Hussein has ignored the United States, ignored the United Nations, and ignored the world.

And he's now had 12 years to try to comply with the expectations of the world and he hasn't done it. The test is on Saddam Hussein. And he has weapons of mass destruction. He should bring them all out, allow for them to be destroyed, and that's what should be done.

The inspectors are there to verify his compliance, but he has not demonstrated much will to comply with what the United Nations has asked.

SCHIEFFER: I take your point, but, and all of the above is true, but even as you say that, support, according to all the public opinion polls in this country for waging war against Saddam Hussein seems to be slipping.

Doesn't the president have to make more of a case than has been made thus far if he's to win the support of the American people to do what he may decide has to be done?

CARD: The case is relatively easy to make in terms of Saddam Hussein. And Saddam has not complied with the U.N. The inspectors will make their report to the United Nations tomorrow.

Hans Blix will appear before the U.N. Security Council. It's very important that we allow Hans Blix to make that report. The president will then take that report and analyze it, and he'll talk to the American people about it.

But the primary objective on Tuesday night, when the president talks about the United States of America and the state of our union, he will talk about more than just the situation in Iraq or the situation with inspectors or the situation with Saddam Hussein.

He'll be talking about our country and the expectations that we have. And there are a lot of challenges that we face, and this president has a vision for us to be able to meet those challenges.

SCHIEFFER: We'll come back to that. I want to introduce Amy Walter of the Cook Report. As you know, Andy, and I know, this is the Bible of the political community.

The Cook Report does the analysis every year on all the races around the country. Amy is one of their top reporters. Amy?

AMY WALTER, Cook Political Report: Well, thank you very much. Talking about it in the State of the Union address here and the expectations and the challenges before us, the president clearly has made the war on terrorism a top priority.

And yet we've seen in some recent polls that Americans do feel that an imminent war in Iraq, or military action in Iraq, could increase the threat of terrorism.

How does the president address that? What needs to be said to the American public about that?

CARD: Well, we had the whole dynamic of the world change on September 11th, 2001. America thought that our oceans would protect us from having an attack.

And our oceans didn't protect us. And we had a terrorist attack that was planned outside the country, carried out within. And that meant that the dynamic changed of what the president must focus on.

He focuses on securing the homeland first, and we've made tremendous progress in securing our homeland. We know that we are in a war against terrorism, and that war is being waged every single day, and it's a war that will go on for some time.

But we're going to continue to be resolved in how we fight that war, and the president will talk about that. And yes, we have to make sure that weapons of mass destruction don't get into the hands of terrorists, because we know that they would like to do dastardly things to us.

And so it's all fitting together, and the president will outline that. But he will also talk about the challenges that we have at home. We have a stagnant economy that we want to see grow faster, and the president will talk about that.

We need better health care. We need prescription drugs for seniors. The president will talk about that. The president will also talk about the tremendous compassion that exists in this country, and how we have to take that compassion and bring it to people who are in desperate need of help.

SCHIEFFER: Let me just go back, and we'll talk about the domestic side in a minute, but let's stay on the war for a minute. I want to go back to what you're saying.

You say that there is going to be a report from Hans Blix, the president will study it.

There are some reports that the administration may be willing to give the inspectors more time, because if everything we hear is correct, he's going to ask for more time to do inspections.

Do you think there's a possibility the president will say, "We'll give you more time to inspect?"

CARD: I think time is running out for Saddam Hussein, and this is not a question about the inspectors, it's a question about Saddam Hussein.

Saddam Hussein is the one who has the obligation. The inspectors are really there to verify, and it's hard for them to verify a situation if Saddam Hussein is not cooperating.

I think that we will find Hans Blix tomorrow will probably say Saddam Hussein has not been cooperating the way he should. And so that will then be the challenge.

What can we do to encourage Saddam Hussein to cooperate fully with the world and bring those weapons of mass destruction to the open sight so that they can be destroyed.

You know, we know for a fact that he has 30,000 chemical warheads, and so far the inspectors have only found a handful. At that rate, if this, you know, hide-and-seek game is to continue it would take 289 years for us to find all of the chemical weapons that we know he has.

SCHIEFFER: Well, if we know he has these, why don't we tell the inspectors where they are so they can go find them? Or are we?

CARD: Well, the burden is for Saddam Hussein to admit that he has them and tell us where they are and bring them out. You're putting the burden on the inspectors. The burden really should be on Saddam Hussein.


WALTER: Now, will there will be a timetable put on these inspections? Will the president come out and say, "By this date, this has to happen?"

CARD: The president is going to talk about the state of the union on Tuesday night, and his interests include the challenges of Saddam Hussein, but his interests also include the other concerns that American people have.

And so I don't think that you should look to the State of the Union address to be solely about Iraq or solely about Saddam Hussein or solely about inspectors.

In fact, the president will talk about the plethora of issues that we are concerned about.

SCHIEFFER: Well, is what you're saying here today, Mr. Card, that this is not going to be the speech where the president lays out the case for war with Iraq should that become necessary?

CARD: The president will clearly highlight some of the questions that have not been answered by Saddam Hussein and the responsibility that he has to answer those questions and allow for the inspectors to verify his compliance.

But this speech on Tuesday night is not a speech just about Iraq. It's about all of the concerns we have.

SCHIEFFER: Well, is he going to lay out any additional evidence? Is he going to tell us something we don't know about Saddam Hussein that will help to make the case should it become necessary to go to war?

CARD: Well, I think the important thing is that there are a lot of lingering questions that Saddam Hussein has not answered. He has not answered the questions put forward by the United Nations.

He hasn't even answered the questions that were put forward by the United Nations in 1997 and 1998. And those questions deserve answers if he is to demonstrate that he is complying with what the U.N. has told him to do.


WALTER: Well, maybe we can move to the domestic front just for a moment. There's obviously been a lot of talk from the president, administration in recent weeks about tax cuts, about the economy, about that plan.

Yet the majority of Americans still feel very uncomfortable about the direction of the country, the president's handling of the economy. How does he address that in the State of the Union speech?

What does he need to say to America on Tuesday night?

CARD: Well, he's going to call attention to the fact that the president has put forward a growth and jobs agenda that will be good for our economy, short term and long term.

And it will provide tax relief for all 93 million Americans who pay income taxes. Everyone who pays income taxes will benefit under the president's plan.

He's also calling for assistance to go to the small-business community. You know, there are some 23 million small businesses in this country, and they're the ones that create the first opportunity for a job.

And we would like to see more job opportunities. That's why the growth and jobs package that the president put forward is so important, because it will provide an opportunity for people to find work.

For people who haven't found work we have solutions as well, and we also know that in terms of taxes we want taxes to be fair. And we have an unfair system in our tax code right now that provides for the double taxation of dividends, and the biggest beneficiary of a tax cut eliminating the double tax on dividends would be senior citizens, and the president will call attention to that.

SCHIEFFER: Now, you will be followed this morning by Tom Daschle. You know what Tom Daschle has said about the president's plan. He says it's a leave-no-millionaire-behind plan, that it's all tilted toward the rich.

The Democrats have now come out with their plan, which, among other things, calls for a $300 rebate for everybody. I'll give you a chance to comment on the Democrats' plan.

CARD: Well, I think the Democrats' plan, and first of all, there is no Democrats' plan.

There are a whole bunch of Democrats who have offered suggestions, and Tom Daschle has one suggestion.

The president's plan is comprehensive. It was developed in consultation with leading economists from around the country with -- sharing different philosophies, and it was not put together in the context of a political document. It was put together in the context of what would be best for our economy, short-term and long-term.

So I think many of the Democrats' plans look more like political statements than they do good sound economic plans for the growth in our country that we need to have in order to generate more employment.

SCHIEFFER: Thank you very much, Mr. Card. I know you've got a busy week ahead.

CARD: Thank you.

SCHIEFFER: We'll let you go. Thanks so much.

We'll be back in a minute with Democratic leader of the Senate Tom Daschle, in a second.


SCHIEFFER: And joining us now, the Democratic leader in the Senate, Tom Daschle.

We'll start on domestic things, because that's where we ended with Andy Card.

He said that your plan to improve the economy was more like a political statement than a plan. He also said, look, all the Democrats have a plan, that they need to come up with one plan, as the White House has done.

I'll give you a chance to respond to that.

SEN. TOM DASCHLE, Minority Leader, D-S.D.: Well, Bob, we have one set of principles, and it's endorsed by virtually every mainstream economist in the country.

Those principles include immediacy. You've got to do it to affect this year, this economy, right now. The president's plan doesn't do that. 95 percent of the plan takes effect in the out years.

They said it also ought to be fiscally responsible, and without any question their plan costs about $1.5 trillion when you put it all together. Ours is a little over $100 billion, very fiscally responsible.

It's said it ought to be broad-based. Everybody ought to be affected by it. Theirs is not, ours is.

And then, finally, they said that you really ought to affect the states, try to help the states with a $100-billion deficit that they're facing. Ours does it. Theirs does not.

So on every case, we have followed the recommendations made by the mainstream economists, and we have virtual unanimity on those principles today.

SCHIEFFER: Well, as for your criticism of the president's plan, isn't that a little far to take it, to call it "leave no millionaire behind", because, in fact, any kind of tax plan has to be aimed at the people who pay taxes. That's what the Republicans would tell you.

Is it tilted as much to the rich as you claim it is, or is that just political rhetoric?

DASCHLE: Well, it is a leave-no-millionaire-behind act, because in large measure, that's where the benefits go. Well over 60 percent of all the benefits go to the top one or two percent, Bob. There are 226,000 millionaires getting $89,000 a year under the president's plan, this at a time when we may be going to war, actually asking people to put their lives on the line.

When you ask somebody 20 years from now what did you do in the war, and somebody says, well, I got an $89,000 tax break, that isn't my sense of sacrifice, that isn't what we ought to be doing. That's why we shouldn't be passing a leave-no-millionaire-behind act.

SCHIEFFER: Well, let's talk about the war. Amy?

WALTER: Well, we've certainly heard before what Andy Card said. Do you believe that, if the administration does decide to go to war, they do need to come to Congress first to talk to you?

DASCHLE: Amy, I think that it is essential that there be adequate consultation all the way through. The resolution we passed last fall demanded that, said that there had to be the consultation, the reports, there had to be work in the international community.

So without a doubt, the president needs to make a very compelling case that this is the time that would require military action. So far he hasn't done that. I think the burden of proof, the burden of responsibility to do that is on him today.

WALTER: What do you need to hear in the State of the Union address for him to make that case to you?

DASCHLE: Well, I think two things. I think the president needs to make a compelling case that Iraq poses a very imminent threat to the United States, and that secondly, that he has worked through the international community and exhausted all other options.

Only if those two criteria are met, does he have the authority, the license to take military action.

WALTER: Do you think that inspections should continue?

DASCHLE: Absolutely. I think that what has been done so far has been very helpful. But they've only inspected a fraction of the sites. A lot more needs to be done, and we need to give them time to do that.

SCHIEFFER: Well, some would say, look, if you let them keep having more time, we may go for another year looking for weapons.


DASCHLE: Absolutely, Bob, and I would not be supportive of that.

There has to be a practical limitation, but certainly to say, for whatever purposes that we arbitrarily have chosen, that this date is the cutoff date doesn't make sense either. Let's give them the time. The international community is demanding it. I think that the facts demand that they have the opportunity to see just what else could be found prior to the time we have to come to this conclusion.

SCHIEFFER: Well, do you think that -- you say you need more consultation with the Congress. Do I take you to mean that the Congress has to pass another resolution, or do you think that's necessary, before there's military action?

DASCHLE: I don't believe another resolution would be necessary per se, but do I believe that, to the maximum degree possible, he has to work with the Congress, he has to make his case to the American people, and he certainly has to work within the international community.

This is not a time when the United States should go it alone.

SCHIEFFER: Do you think he...?

DASCHLE: We can't afford it, and it would be a mistake.

SCHIEFFER: Do you think he should get another resolution from the United Nations, or do we have what we need if he decides to go into Iraq?

DASCHLE: Well, there are various ways to demonstrate international commitment and international cooperation and support. It wouldn't require necessarily a U.N. resolution. But I think the American people are demanding that, before we act unilaterally, that he demonstrate why it's impossible to get that international coalition, and, if he can't, again the burden of proof is on him to explain why. I think it's essential, I think it's absolutely imperative that he work through the international community in whatever we do in Iraq.

SCHIEFFER: Well, what happens if worse comes to worse, and the president decides, I simply -- this is so grave, that the United States must go it alone. What if that happens?

DASCHLE: Well, Bob, I think that would be a tragic failure of the president's ability to bring together the coalition that we're talking about.

And in light of a tragic failure of that kind I think the burden of proof would be on him. He would have to make the most compelling case that he could to the American people about why it's imperative the United States act alone, and lay out the dangers of doing so.

SCHIEFFER: Do you agree with John Kerry, who is running for the Democratic presidential nomination, when he says now there is a rush to war?

DASCHLE: Well, I think that the president is acting in a very precipitous way, and I think it's very important for us, as I said now, I have said on several occasions, it's very important for him to take the building blocks and create the kind of international support that's so crucial here.

We ought not be rushing to war, and I think it would be very counterproductive for the president to do so now.


WALTER: If we can just go back to domestic issues for a moment. There was also talk recently, the administration put forward the building blocks for a Medicare prescription drug bill.

You came out pretty quickly and said they need to go back to the drawing board. Democrats, in recent years certainly, have made a prescription drug benefit a big plank in both their campaign and in their domestic agenda.

Can you afford not to compromise on this issue? Can you afford to let Republicans politically paint you as being obstructionist, as not allowing something as popular as prescription drug benefit from passing under Medicare?

DASCHLE: Well, Amy, this is, the plan that the president laid out this week is one that the HMOs should love. It's forcing senior citizens to trade the doctor they choose for the drugs they need.

I can't imagine anybody in America would support that. I think what the president is proposing is absolutely wrong. Holding out the possibility of drugs if they give up their Medicare benefits and the tremendous opportunity they have to access health care for an HMO when in many parts of the country, like South Dakota, we don't even have an HMO.

So I think it would be a very, very big mistake, and I'm hopeful that people will be very careful before they rush to judgment about that. You know, we still have 30 years of viability under Medicare.

And I think if we're going to fix Medicare we have to fix the health care system itself. That's the problem. It isn't Medicare.

WALTER: So is there room for compromise then? Do you see by 2004 that there will be something passed on the president, that will be sitting on the president's desk?

DASCHLE: Well, I will tell you this. We will do all that is within our power to avoid forcing the senior citizens of our country to pick between an HMO and prescription drugs.

That isn't compromise. We've got to stand firm. We've got to be strong.

We've got to protect Medicare. We've got to ensure that senior citizens have the confidence they're going to have both Medicare and a meaningful prescription drug benefit.

And I think there is room for compromise.

SCHIEFFER: Do you think the president's proposal to remove the tax on stock dividends is dead?

DASCHLE: I think it is. I would say that the stock dividend approach is dead on arrival. I think that there is adequate support in opposition to the president's plan both on the Republican and Democratic side.

It's a huge handout to those who don't need it, and there's nothing stimulative about it. I think it could very adversely affect the states in so many ways, Bob. So I hope that that prediction will bear itself out.

SCHIEFFER: Before we let you go, we really haven't talked to you much about politics. You decided that you would not seek the Democratic nomination. There are a lot of Democrats who are. But I want to ask you this. What happened to the Democrats in the last election?

DASCHLE: Well, Bob, I think that we did better than most people realize. You know, the Republicans had 50 senators in the 107th Congress. Today, they have 51.

We actually picked up a net of three additional Democratic governors. With 44,000 more votes we would have had the majority in the Senate. We didn't do nearly as badly as what some people realize, and with the Louisiana case, the race that we just won, we're well on our way to regaining the Senate in the year 2004.

SCHIEFFER: All right, well Senator, we have to leave it there. Thanks so much for being here.

DASCHLE: My pleasure.

SCHIEFFER: Back with a final word in just a minute.


SCHIEFFER: Finally today, some of the things that must be going through the president's mind as he contemplates war with Iraq and what he will say in his State of the Union message.

He has noticed by now that public support for the war is slipping, but he knows as well polls can't be the driving force in making this decision. If Roosevelt and Churchill had followed polls, well, you've heard that a thousand times.

He has been warned the entire Arab world will rise up against us if we go into Iraq. One man's opinion, but I doubt it. Saddam rules by fear and has no friends. My guess is that if we topple him, there will be a long line trying to get to the victory table trying to help us celebrate. The hard part will be how we handle what comes after victory. That may take years, and we should have no illusions.

We should also keep criticism from Europe in context. We're the only superpower now. When you live in the big house on the block, there will always be criticism from some of those who live in the smaller houses. It's just the way of the world.

The president will get all kinds of advice from all kinds of advisers. But in the end, there is only one legitimate reason for going to war. Only one test should apply: Is the threat to the nation so grave that a president, any president, is willing to send his own children to combat it?

If it is, then the president must tell us why and make the case in some detail. There can be no secrets here. If it isn't, and if he can't, then we shouldn't do it.

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