BOB SCHIEFFER, Chief Washington Correspondent: Today on Face the Nation, Secretary of State Colin Powell on another terror alert for the Fourth of July and the future of Yassir Arafat.
Federal authorities have issued a secret alert to law enforcement agencies, warning them of yet another terrorist attack around July 4th. Why was it in secret? Is the threat from Al Qaida? We'll ask Secretary of State Colin Powell.
Then we'll turn to the Middle East. Will Arafat give up leadership of the PLO and would that stop the violence? For context and perspective, we'll talk with New York Times foreign affairs columnist Tom Friedman, who's just back from Iran.
Gloria Borger will be here, and I'll have a final word on school vouchers.
But first, Secretary of State Powell on Face the Nation.
And the secretary of state is in the studio with us this morning.
Mr. Secretary, thank you for coming.
COLIN POWELL, Secretary of State: Good morning, Bob, Gloria.
SCHIEFFER: Let me ask you first about this report we have that the government has issued some sort of alert, warning of some kind of terrorist activity around the Fourth of July, which apparently was not made public but was given to law enforcement officials around the country. What can you tell us about that?
POWELL: Well, as you know, there have been a variety of reports coming in, intelligence reports that suggest we ought to be especially vigilant as we go into the Fourth of July season.
I don't want to over-hype it, but I think what was passed out yesterday is just a prudent alert to law enforcement agencies. And in the course of the next couple of days, we'll be meeting on a regular basis to make an assessment of any additional threats that might be coming our way.
But I hope most Americans will go about their business and enjoy the Fourth of July. I intend to.
SCHIEFFER: Is there any information on when, where, how?
POWELL: No. It's the usual -- it's the usual body of information and intelligence that comes forward. But I do know that the FBI and the CIA and all of our intelligence and law enforcement agencies within the federal government, state and local governments, are examining all of this carefully so that we can make sure that we are on alert but, at the same time, make sure that the American people can enjoy our national holiday. I'm going to do so.
SCHIEFFER: Does this have anything to do with Al Qaida?
POWELL: There are some Al Qaida reports and there are other reports.
But it's just a time for heightened awareness.
GLORIA BORGER, U.S. News & World Report: There are also reports today in the newspapers of a new alliance between Hezbollah, which is a Lebanon-based terror organization, and Al Qaida. How serious is that?
POWELL: Well, I've read those reports. I haven't gotten into the details of them yet. But we should take it seriously. Any time you see any terrorist organization that has not been cooperating previously with Al Qaida start to work with Al Qaida -- then I think you should take it seriously, and we will take it seriously.
BORGER: Let's talk a little bit about the president's Mideast speech of this past week. He made it clear -- very clear in that speech that Yassir Arafat has to go. Some people have said, however, that that's going to have the result of making Arafat just more popular. How do you respond to that?
POWELL: The president gave two messages in the speech. One, he said that the current leadership of the Palestinian people is flawed. It's been a disappointment. Chairman Arafat has not used his position of leadership to move the Palestinian people in the correct direction, and he has tolerated actions that have led to violence and terrorist acts.
I had the most direct conversation you can have with a person with Chairman Arafat two months ago at his headquarters when he was being besieged by the Israeli army. And I said to him, when this siege is over you have got to move in a new direction or we will not be able to continue to try to help you. And frankly, he's not moved in that new direction, so the president gave a clear message that it's time for new leadership.
The president in his speech also gave another clear message that the United States stands ready, willing and able to help the Palestinian people achieve their goal of their own state, Palestine, living side by side with Israel.
And the president said he thinks it's possible to achieve such a vision in three years' time, and he will work to that end, but it begins with new leaders coming in and moving the Palestinian movement in a new direction. And we don't think that Chairman Arafat is a leader for that. But it's up to the Palestinian people to determine who their leaders will be.
SCHIEFFER: If Arafat called you today, would you take the call?
POWELL: No, I don't know that I would. I'm not expecting him to call, and I haven't called him since the president's speech, and I haven't talked to him in some time.
SCHIEFFER: Mr. Secretary, it is well known that you argued within the administration for a long time that Arafat was the only person to deal with, that he was the leader and there was nobody else really deal with. When did you change your mind about that?
POWELL: I worked for 18 months to try to put in place a plan that would allow Chairman Arafat to demonstrate his leadership. We put down the Mitchell plan, the Tenet plan, the president's speech at the U.N., my speech at Louisville, we sent General Zinni in -- all for the purpose of getting things started. Things would have gotten started. We'd have been way along if the violence had been brought down.
Chairman Arafat simply did not seize any of these opportunities to bring the violence under control using his moral authority as the leader of the Palestinian people or the authority he's had under him, the organizations he had under him. And so he missed all of these opportunities, just as he missed the opportunity that President Clinton presented to him some two years ago. And so it became clear in recent weeks that we were not going to get that kind of leadership.
Moreover, after the Israelis pulled back from the latest occupation, then we thought maybe we'd have some movement. What we saw instead were more bombings, bombing after bombing after bombing, day after day.
And frankly, we also saw a continuing indication that there was complicity with the senior levels of the Palestinian Authority.
BORGER: Do you believe...
POWELL: And with that kind of information, we finally had to face the reality that we have to find other leaders within the Palestinian movement to work with in order to help the Palestinian people.
It isn't something we're doing for ourselves. Not something we're doing for Israel. It's something we're trying to do for the Palestinian people. They're suffering; they're hurting. The president, as he said, they are gifted people. They are people who -- our heart goes out to them.
We're trying to help them, but they need to help themselves by bringing forward other leaders who will move in a more responsible direction.
SCHIEFFER: So basically you've had it with Yassir Arafat?
POWELL: Chairman Arafat has not used the power and the moral authority that he has been given by the Palestinian people to move them in the right direction.
And the Palestinian people, in the months ahead, as they get ready for elections, as they look at the situation they find themselves in -- not able to move around, the whole world condemning them for terrorist activity -- they ought to take a look at the leadership that brought them to such a pass and the realization that they are not going to be able to move forward toward a state with this kind of leadership unless it changes.
BORGER: Very quickly, do you believe that Arafat then knowingly financed suicide bombings?
POWELL: There is evidence that there was knowledge of this kind of activity and there wasn't sufficient action taken to stop it. I don't want to go any further because we're getting into some sensitive areas I can't discuss.
BORGER: This election does not come for another six months. What is the U.S. game plan in the meantime?
POWELL: Tomorrow, Assistant Secretary of State Burns will travel to Europe where he will meet with our European allies and U.N. representatives. And he will begin to put down a specific work plan as to how we can help Palestinian leaders reform themselves, reform their institutions, find a way to diffuse power within the Palestinian movement so it isn't all in the hands of one individual, the president.
Secretary Burns will continue that work in the course of the week, and he will put in place a process that will permit me to deal with and go meet with my European colleagues and the United Nations officials and then to meet with foreign ministers and other leaders of the Arab nations.
So we are going to get deeply engaged in putting together a work plan that we can use, with Palestinian leaders, to reform themselves.
It's not just the United States calling for reform; European leaders are calling for reform. You heard it coming out of the G-8, Prime Minister Berlusconi of Italy suggesting Chairman Arafat should step aside. Prime Minister Blair speaking rather strongly about it.
And also within the Palestinian movement, you can see other Palestinian leaders saying to themselves, where are we heading? What have we gotten? What is our current situation, and what's the likelihood that we will get to our Palestinian state with this kind of leadership?
So, there are fissures, there are different points of view within the Palestinian movement and the Palestinian community. And we should give them the benefit of the doubt that, in the months ahead before the election, they will examine what is in their best interest and vote for what's in their best interest.
SCHIEFFER: Well, that does beg the question of course, what happens if they elect Yassir Arafat? Then who do we deal with?
POWELL: If they elect Yassir Arafat, they will be bringing back into a position of authority, the leadership of their community, the same failed leadership that has existed previously. And that's their choice to make.
SCHIEFFER: But what do we do? I mean...
POWELL: That's their choice to make. And if there is no change, then it's unlikely we will have any more success with that new leadership, as you might call it, than with the leadership that currently exists. It will not improve their situation, but that's a choice for them to make.
BORGER: How can we, as a democracy, though, tell a people who elect a leader that we would refuse to deal with their democratically elected leader?
POWELL: They have -- they have the right to elect whoever they wish to, and we have the right and the ability to determine how we will deal with those circumstances.
But if we find that that leadership has failed in the past, has been a severe disappointment, the word the president uses very often, the disappointment to all of us, because we want to work with the Palestinian people, and if that continues to be the choice of the Palestinian people, then they ought to understand the consequences of such a choice.
SCHIEFFER: There are reports, you pick it up from various critics, both some on the record and some not, that basically what happened with the president's speech was that the vice president triumphed here and basically locked anything happening in the Middle East until after the elections, because by saying that we can't deal with Arafat, that just sort of puts things on hold. How would you respond to that?
POWELL: In every conversation we had about this subject, and they were very intense conversations -- what should we say about the Palestinian leadership? What should we say about our vision going forward? What demands should we place on the table that we want Israel to meet as we move forward?
These were the most intense discussions. Never once, never once, in any of the discussions, and I was in every one of those discussions, was there the slightest reference to the congressional election coming up in the United States. This was strictly on the merits; it was strictly on our analysis of the current situation.
SCHIEFFER: Let me just ask you also because you've mentioned this.
Tom Friedman, who will be coming on in a minute to talk to us about context and analysis of this, says that one problem with the president's speech, in his view, is that you didn't ask enough of Israel. You laid down the law to the Palestinians, but you didn't say to the Israelis, you've got to pull back out of the territories. How do you respond to that?
POWELL: Well, if you look at what we did ask the Israelis to do once we had gotten some calm and stability to the situation, where you don't have a bomb going off every day, we asked the Israelis in that speech to be prepared to return to the positions that were occupied prior to 28 September, 2000, that's a pull back. We asked them to increase access and the ability of the Palestinian people to get to jobs, to get to hospitals, to get to schools. We asked Israel to return the revenues that they are holding for the Palestinian people. We asked for an end to the occupation, we asked for the end of settlement activity.
So there are a lot of issues in there and a lot of demands that Israel will have to deal with in due course. But it is hard to get to that point of dealing with these while the violence continues and while the terror continues. That has frustrated every effort that the last couple of administrations have made.
I mean, we inherited the intifada when this administration came in, and we have been trying to get that violence down to some level, preferably zero, but at least at some level where the Israeli side can say, OK, let's now move forward and start to meet these conditions.
I take note of the fact that this morning the Israeli minister of defense, Mr. Ben-Eliezer, is taking action against some of the settlement activity, or at least he says he will. And so Israel understands that the settlement activity is one of those issues that have to be dealt with.
BORGER: Very quickly, is a Middle East peace conference dead right now?
POWELL: For the moment, it's just been -- it's not an issue. I was anxious to have a conference this summer. And earlier in the spring, as we were putting the pieces together, there was some promise. We had some movement. We looked like we were moving in the right direction.
But in light of the continuing violence, in light of the Israeli need, as they saw it, to go back into the areas, and in light of the decision we made that we are not getting anywhere with Chairman Arafat, it is appropriate right now not to talk about a conference.
I think there will be a conference in due course. If you are going to put people back together and have them talk to one another, then that's what conferences and meetings are for, so I have not moved away from that goal. But it is not something that is immediately in front of us.
SCHIEFFER: Mr. Secretary, thank you very much for being with us this morning.
POWELL: Thank you, Bob, Gloria.
BORGER: Thank you.
SCHIEFFER: When we come back, we'll get some context and analysis from Tom Friedman of the New York Times, in a minute.
SCHIEFFER: And with us now, Tom Friedman, the foreign affairs columnist of the New York Times and who has won yet another Pulitzer since his last appearance.
What are you up to now to, three?
FRIEDMAN: I'm -- my third green jacket.
SCHIEFFER: That's great.
You heard the secretary of state, Tom. He sounds like he's had it with Yassir Arafat, and that does represent a shift, doesn't it?
TOM FRIEDMAN, New York Times: It does, Bob. And I think it's a laudable thing. You know, there is nothing like telling the truth. And the fact is, Yassir Arafat really has misled his people and he has failed his people and he has failed this whole process. And I think it will have a big impact, the United States telling the truth.
Arafat has done three things here, Bob, that he has never done in the past. And that's why this is a new moment for him. This is his '67 war. First of all, he has destroyed Palestinian cities this time. Not just Aman, not just Beirut, but Nablus, Jenin, Ramallah, by what he did.
Secondly, he destroyed the Palestinian-U.S. relationship. Bill Clinton met with Yassir Arafat more than any other foreign leader. Yassir Arafat couldn't get in to see George Bush if he got a ticket in the tourist line at the West Wing.
And thirdly, Arafat destroyed the Israeli peace camp.
Those are three big things that I think deserve, or have won him really, the kind of criticism he has gotten from the United States. He does need to go, and I think it's good that the president called on him to leave.
SCHIEFFER: You know, what I found interesting and what the secretary of state said today was, he not only said he is not going to deal with Yassir Arafat anymore. He basically laid down a warning to the Palestinian people, yes, he is going to run, and yes, if you elect him, you will be no better off today than you -- tomorrow than you are today because we're still not going to deal with him. I found that quite unusual that he would come on that strong.
FRIEDMAN: He was right when he said you're free to elect him and we're free not to talk to him. And I think over time that will have an effect.
I do not take it as a given that somehow Palestinians are going to snub us by electing him again. I think if they have any opportunity, if Israel gives them any incentive by showing that it, too, really is interested in a serious deal with a serious and credible Palestinian leader, I would -- I say the Palestinians could surprise us here and the Arabs could surprise us here. And you may see Arafat kicked upstairs into some ceremonial role or whatever.
BORGER: So you think there is a way that, in fact, Arafat may decide not to run?
FRIEDMAN: I think there is a way that the Palestinians and the Arabs might prevail upon him to become king of the Palestinians and turn leadership over to a prime minister.
BORGER: Can I talk to you a moment about this timetable the administration seems to have. There is this election in six months. We asked the secretary of state what would occur during that gap, and he said that he is going to send the Assistant Secretary Of State Burns over there to Europe to meet with leaders.
Beyond that, is there anything specific?
FRIEDMAN: I love Bill Burns. He is a really capable diplomat; I think the best we've got. But that's not exactly going to shake them up in the Middle East. We've got a six-month gap here basically.
Why isn't Colin Powell on a plane right now going to every Arab country, going on Arab TV and explaining to Arab public exactly why we've come to this point, exactly what we need them to do and why, if they do it, it will actually get them and Israel to the place we want to go? I don't get that.
This administration, they're good at giving speeches but they're really not good at diplomacy. They're good at smashing things, but they're not real great at diplomacy. And I think part of it is that internal division in this administration between the Pentagon and the State Department, which seems to really plague them on every issue.
BORGER: Well, is there...
SCHIEFFER: Go ahead.
BORGER: I was just going to say, is there a sense that if they go out on a limb, they can fail?
FRIEDMAN: Yes, and guess what? You may fail, you know. But again, I think it gets to one of the weaknesses we have been talking about which is that you know, this was a very convenient speech politically for the president to give. He basically blamed Arafat. You really didn't call on Israel to do anything hard. And I would say that's a consistent pattern with this president.
He has 70 percent approval rating. But what is he using it for? Where is his Sister Souljah speech? What constituency, from the steelworkers to the farmers, OK, to calling on the American public even to maybe use just a little less energy after 9/11 so we won't be dependent on these people? Who has he looked in the eye since 9/11 and said, "I want to you do something really hard"?
SCHIEFFER: What do you make of these reports that are going around Washington, which I think one of them appeared in the New York Times today, in which it is said that what really happened with the president's speech was that the vice president, Vice President Cheney, won by convincing the president to no longer deal with Arafat. What he was really doing was locking down this whole process, and that basically, it ensures that nothing is really going to happen until after the November elections.
Now, you heard the secretary of state sort of finesse that. He said in all these conversations, I didn't hear anybody mention the congressional elections once. Well, I wouldn't have think -- I wouldn't have thought they would have mentioned it once. It doesn't have to be said.
FRIEDMAN: They didn't need to, I mean, it's understood.
I want to give the president and the team credit. They are doing the right thing. It happens that the right thing here is also the politically really convenient thing if you don't want to alienate Jewish voters in any way, if you don't want to ask Israel to do anything hard.
And that, I think, is a shortcoming. I think they're doing right thing with Arafat. I think they could have pressed Israel more for a symbolic gesture. Symbolically, pull back some of these illegal settlements. Forget the legal ones, even the -- just the illegal ones. We are asking the Palestinians to do what is in their self-interest, surely we can ask Israelis to do what is in their self-interest.
And I think the reluctance there is a political one. It's a concern about the upcoming election. George Bush has made huge inroads with American Jewish voters.
And again, like he is building up all of this great support to use it for what? I'm not sure. Again I don't there again, I think he doesn't want to draw down the bank.
BORGER: And where are the Democrats on all of this?
FRIEDMAN: The Democrats, a good question, but, you know, really, what I've concluded, Gloria, that the opposition on foreign policy in this country is really three people: John McCain, Colin Powell and Tony Blair.
And the last time I checked, two of them Republicans and one is a foreign leader.
BORGER: And one in the administration.
FRIEDMAN: Exactly, one's in the administration.
There is no right now serious, heavyweight Democrat who can really, on national security issues, get the attention and bring a big constituency behind him in a way that really worries this administration.
SCHIEFFER: Tom Friedman, it's always good to have you.
FRIEDMAN: Great to be here.
SCHIEFFER: You always bring something that I hadn't thought of. Well, of course, there are a lot of things I hadn't thought of.
FRIEDMAN: Thank you.
SCHIEFFER: But you always manage to do that. Thanks so much for coming today.
FRIEDMAN: Appreciate it.
SCHIEFFER: We'll be back with a final word in just a minute.
SCHIEFFER: Finally today, when the Supreme Court decided last week that school vouchers were constitutional, that it was legal for parents whose kids were stuck in bad schools to receive tax credits or government subsidies to send them to private schools, I was glad.
I went to public schools and am proud of it, and there was a time when I was against the whole concept of school vouchers, because I thought they would destroy the school system.
And to me, schools were always more than places our kids learned to read. They provided one of those common experiences, like the old draft army, that tied us together as a nation.
But I came to understand that the common experience of my generation is not the common experience of today's. In two many places, public schooling is an experience shared only by the poor, and too often, they are not even learning to read.
The clincher for me was this: There is a fine group in Washington called the "I Have a Dream Foundation," which helps needy students. From them, I learned that a child can be placed in a good, safe private school for tuition that is considerably less than what the District of Columbia spends per child on students in its system.
Now, how can that be, that a small private school can educate a child for less money than a public school and do it in smaller, cleaner and safer classes? I don't know, but no parent, rich or poor, should have to put up with that.
That is why I believe we should begin pilot programs to test vouchers and any number of other innovative concepts, and the District of Columbia would be a fine place to start. Because what we're doing is not working. We need to find out what does.
That's it for us. We'll see you next week right here on Face the Nation.