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Insists Campaign Finance Reform is a Winning Issue (Interview)

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Location: CNN Late Edition

HEADLINE: John McCain Insists Campaign Finance Reform Is a Winning Issue

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THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.

WOLF BLITZER, HOST: It's noon in Washington, 9:00 a.m. in Los Angeles; 5:00 p.m. in London; and 7:00 p.m. in Jerusalem. Wherever you're watching from around the world, thanks for joining us for the 90-minute LATE EDITION.

We begin today with the race for the White House. It's the last weekend for campaigning before the Christmas holiday. Democrats Al Gore and Bill Bradley faced off on NBC's Meet the Press earlier today. More on that later.

Republican front-runner George W. Bush is spending the weekend in his homestate of Texas. And the man who's now polling ahead of Governor Bush in the first primary state, New Hampshire, Senator John McCain, is campaigning in New England. He joins us now live from city hall in Burlington, Vermont, where he'll be hosting a town meeting immediately after this interview.

Senator McCain, welcome back to LATE EDITION. Thanks for joining us.

SEN. JOHN MCCAIN (R-AZ), PRESIDENTIAL CANDIDATE: Thank you, Wolf.

BLITZER: The campaign finance reform is the key issue that you've been raising. You raised it this week with the joint appearance—with the Democratic candidate Bill Bradley, but look at these numbers in a CNN/"USA Today"/Gallup poll.

When the American people were asked, what are important issues that they're concerned about, 84 percent cited Social Security; 79 percent said health care; 78 percent, Medicare; 61 percent, gun control; 60 percent cited tax cuts. Only 40 percent, less than half of the American people think campaign finance reform is an important issue. How do you hope to generate the kind of support you need if less than half of the people think your key issue is an important issue?

MCCAIN: Well, first of all, I think we already have, because I've been campaigning on reform of government all over—the government, whether it be education or the military or the tax code. But my message is, if you're a conservative—and the only way you're going to reduce the size of government and the only way you're going to get participation on the part of young people is, you're going to have to eliminate these effects of soft money.

And if I may quickly add, if you ask that question in the following way, "influence of big money and special interests in Washington," I think you'd get a different result.

My challenge is to connect the influence of these uncontrolled contributions on the legislation and our government, which really shuts them out of the government. And that's why I think we've had some success. It's a tough fight.

BLITZER: It's a tough fight, and you know, earlier today on "Meet the Press," Al Gore, the vice president, responded to your criticism of him earlier in the week on this issue of campaign finance reform. You cited the irregularities in the '96 campaign, the money going to the Democratic campaign, including Al Gore's involvement.

Listen to what he said earlier today—and I'd welcome your response.

(BEGIN VIDEO CLIP)

AL GORE, VICE PRESIDENT OF THE UNITED STATES: What John McCain left out is that when the McCain-Feingold measure was put before the United States Senate, every single Democratic senator voted for it. John hasn't been able to convince his colleagues to support it in the Republican cloak room.

(END VIDEO CLIP)

BLITZER: His point, Senator, that only a handful of Republicans have joined you, all of the Democrats joined you on this issue of campaign finance reform.

MCCAIN: That's a good point, Wolf. I have difficulty in convincing the leadership just as we had trouble convincing the Democrats when they were in a majority back in 1993 and '94 when they passed campaign finance reform, it never went to conference.

The majority is always more reluctant, obviously, because they have more to lose.

But in the last round of these—of this 15-rounder, when Russ Feingold and I had just the proposal to ban soft money, it was the Democrats that blocked debate in amending on the bill as well as Republicans.

So when it gets close, you find the opposition becomes more bipartisan because this system is an incumbency protection racket, and we all know that. And the desire to change becomes less and less as the incumbency becomes threatened.

And by the way, as is now becoming well-known, the Democrats are raising almost as much money or as much money, soft money, the uncontrolled contributions, as the Republicans. And I don't see how that then would motivate Republicans to take another look at this issue, as average Republicans are supporting it all over the country.

BLITZER: You know, the front-runner, I guess he's still the front-runner—certainly nationally he's the front-runner—Governor Bush, he takes strong issue with your campaign finance reform as well. Listen to what he said in Des Moines at the debate earlier this week.

(BEGIN VIDEO CLIP)

GOV. GEORGE W. BUSH (R-AZ), PRESIDENTIAL CANDIDATE: Here's my worry with your plan: It's going to hurt the Republican Party, John. The Democratic Party is really the Democratic Party and the labor unions in America. And my worry is, is that you do nothing about what's called "paycheck protection." We do nothing about saying to labor, you can't take a laboring man's money and spend it the way you see fit.

(END VIDEO CLIP)

BLITZER: He says your plan would unilaterally disarm the Republican Party, that's why almost all Republicans oppose your plan.

MCCAIN: Wolf, first of all, Wolf, let's take a quick look at history. In 1980, there was no such thing as these uncontrolled contributions and labor unions were powerful then, Ronald Reagan became the president. We got a majority in the Senate. In 1994, we were raising less money than the Democrats, who took control of both houses. Then we raised more money than the Democrats. We lost seats in 1996; we lost seats in 1998. Now the House of Representatives is up for grabs and most pundits would say we're going to lose seats in the Senate again.

So one, that's a political reality. Second of all, look it's now illegal—excuse me, it's now legal in America for a Chinese Army- owned corporation with a subsidiary in the United States of America to give unlimited amounts of money to an American political campaign. I want to make that illegal. And I hope the governor of Texas would join me in making that illegal.

This system makes good people do bad things. And young people are opting out in droves. We had the lowest voter turnout in history of the 18- to 26-year-olds in the last elections.

A recent Pew research poll, 69 percent of young Americans say they're disconnected from government because of special interests. We have an obligation to all Americans to represent them and everybody knows that the special interests rule in Washington, which is why we've earned the sometime well justified representation as a do- nothing Congress.

BLITZER: The point though, that Governor Bush makes about the labor unions, that you would not do anything, in effect, to stop the labor unions who support by and large, Democrats, that that would be unfair to Republicans. That's why Republicans oppose what you're doing.

MCCAIN: Look at the contributions to the Democratic Party. There are millions of uncontrolled so-called soft money contributions from guess who? The labor unions. You ban soft money, you ban the labor unions from doing that too. Sure, I would like to see union members only give their permission. But I would also like to in fairness stay only stockholders should give their permission, too, before their money is used for political campaigns, as well.

Look, this system as we all know, is harming America and harming us badly. We had transfer of technology to China. We had all kinds of terrible things happen that we all know about. We've got to fix it. We should sit down together, rather than use the old line that this hurts the Republican Party. What's really hurting the Republican Party is Americans and Republicans who are losing confidence in our leadership.

BLITZER: All right. Let's move on and talk a little bit about the overall campaign. This past week, Lamar Alexander, the former Republican candidate, the former Tennessee governor, endorsed Governor Bush. And in the process, he seemed at least according to some observers, to take a snipe at you. Listen precisely, it's a very short sound bite, but listen to what he said.

(BEGIN VIDEO CLIP)

LAMAR ALEXANDER, FORMER PRESIDENTIAL CANDIDATE: I look for temperament and steadiness and character before I look for anything else.

(END VIDEO CLIP)

BLITZER: That was seen at least as a reference to the accusations by some critics that you have a temper. Did you see it as such?

MCCAIN: I didn't see Governor Alexander's statement, but I'll—we're good friends and we've known each other many years. I think we share a mutual respect for one another.

BLITZER: I know one of the issues that is an issue obviously very passionately held by you, the issue of POWs, MIAs, that some say are still around and unfortunately this is an issue that has troubled you, ironically, given your own history by some in that POW-MIA community.

In fact, Newsweek magazine has an article today that's just coming out saying that they're going to haunt you, these critics, some of them accusing you in effect of being the so-called "Manchurian Candidate."

How are you going to deal with these people who show up at your events? And we've discussed this before, but it is an issue that is out there, as you well know, that you of all people have not done enough to help in the search for POWs and MIAs?

MCCAIN: May I take a point of personal privilege? This gives me a chance to correct a misstatement about Maureen Dowd. She said that Angela Lansbury in the movie, "Manchurian Candidate," turned over the Queen of Diamonds. I said it was the Queen of Hearts. Maureen Dowd was right. It was the Queen of Diamonds that makes me now want to assassinate the president.

But look, the ones that American's will rely on are those I served with: my senior ranking officers who observed me every day, Jim Stockdale—Admiral Jim Stockdale, Bill Lawrence (ph), Orson Swindell (ph), so many wonderful people I had the privilege of serving with.

I won't dignify those comments with a response except to say: Ask those that I had the great and wonderful privilege of serving with.

As far as the MIA issue is concerned, I think we ought to continue, make every effort until there's a full accounting. We're spending about $100 million a year on that effort. Our military is still in Hanoi, recovering remains and pursuing allegations, and I will continue to—as long as I possibly can, until every single one is resolved to make sure we have as full accounting as possible—and I'm proud of my effort in that direction.

BLITZER: All right. Let's move on to talk about some of the issues out there in the news today. For example, the issue of terrorism, the arrest that occurred over the weekend in Oregon and now in Seattle, fears that there could be terrorists incidents aimed at the United States allegedly by Osama bin Laden. Is the Clinton administration, in your opinion, doing enough right now to prevent these kinds of suspected terrorists acts?

MCCAIN: I think we need to improve our human intelligence, which is the dirtiest, nastiest of all business, but it tells—it's able to give us people's intentions rather than snapshot as regular intelligence does. I think that we ought to continue—or begin what I've call rogue-state rollback, and that is efforts to overthrow the regimes from within and from without, not with U.S. military action but through supporting opposition groups to overthrow these regimes that harbor, train and nurture these terrorists organizations so that they can be sure that there's no safe place on earth for them.

BLITZER: On another issue that is out there: gays in the military. Both the Democratic presidential candidates-Bill Bradley and now Al Gore—say that if gays can be police officers, firefighters, members of Congress, why can't they serve in the U.S. military?

MCCAIN: Because the U.S. military is a very unique culture. People live very close together under very difficult conditions. According to Colin Powell, General Norman Schwarzkopf, and every military leader that I respect, they say that unit cohesion has to be preserved, and that the "don't ask, don't tell" policy, despite problems with it—as there is with every policy that has to do with personnel—is working, and I would at minimum, at minimum, call for a review of the policy engaging those military leaders with whom we entrust these young people's lives.

I support the policy, I believe that it's working. I will be glad to have it reviewed. But in the context of a political campaign, to change an administration position without consulting our military leaders I think is not the proper approach to this very difficult and sensitive issue.

BLITZER: OK, Senator McCain, we have to take a quick commercial break.

When we return, more questions and your phone calls for the Republican presidential candidate John McCain.

LATE EDITION will be right back.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

MCCAIN: I'm here to tell you that I want to tell you the things that you don't want to hear as well as the things you want to hear, and one of those is ethanol. Ethanol is not worth it. I hope that hardy band of brave souls will go out and vote for me...

(END VIDEO CLIP)

BLITZER: Senator John McCain during last Monday's debate talking tough with the voters with Iowa.

Welcome back to LATE EDITION. We continue our discussion now with John McCain.

Senator McCain, was it a mistake for you to skip Iowa, given how well you're doing in the polls in New Hampshire?

BLITZER: I don't think so, Wolf, but we'll find out at the time of the Iowa caucuses and what impact they have on New Hampshire. I have limited time and limited assets, and I thought I should devote them to New Hampshire and South Carolina.

I think that strategy so far has paid off. It's certainly saved me hundreds of thousands not competing in the so-called Iowa straw polls. There are four candidates that did that are no longer in the race. We'll find out about the caucuses.

But we had—I don't have unlimited amounts of money obviously. And what we had to do was spend our time in finances in New Hampshire and down in South Carolina and in the Northeast.

BLITZER: Do you have to win in New Hampshire and South Carolina in order to stay viable in this campaign?

MCCAIN: Yes, sir. And I say that in quotes because, as you know, the word "win" sometimes can mean a second or even a third place, but, yes, I have to win.

BLITZER: OK. Win maybe even means a first place, too.

MCCAIN: Yes, sir.

Let's take a caller from Carlotta, California. Please go ahead with your question for Senator John McCain.

CALLER: Yes, Senator McCain. I was wondering if you would ever consider sharing the ticket with Bill Bradley for the race for the White House.

BLITZER: Senator McCain.

MCCAIN: Thank you, I thank you for that question. I have the greatest respect and friendship for Senator Bradley. In being a mediocre high school athlete, I have the utmost admiration for his skills.

But the fact is that he is a liberal Democrat, I am a proud, conservative Republican. We've come together on the issue of reform, and when the day comes when we all sit down together and reform this broken system, I think he would be at the table. But there is no way that he and I could possibly run together because we have totally diverse views about the role of government in society. I respect those views. I just don't share them.

BLITZER: All right, let's on and take a caller from Paradise, California. Please go ahead with your question.

CALLER: Yes, Senator McCain. I'm wondering how are you going to fix the many problems in the Social Security system and keep it viable?

MCCAIN: Thank you very much. It must be very nice to live in a place called Paradise.

We've got to take 60 percent of the surplus and put in the Social Security system; take the Social Security trust fund off budget, including not being raided for emergency reasons—you know, most any reason now that Congress has to find money is, quote, "emergency"—allow people to invest part of their taxes in the private investments, which would be a broad menu decided by the government; take 10 percent of the surplus, put it in Medicare; and the rest to pay down the debt and some tax relief.

I'm worried. I'm worried about the projections that would then cause some to use all of that for tax cuts. I think if we didn't have those projections, then we would be—and we didn't have the surpluses and we enacted those tax cuts, we would be taking money out of the Social Security trust fund. I think that's a bit risky.

Thank you for the question.

BLITZER: Senator McCain, we have less than a minute. This is—today is exactly one year to the date that the House of Representatives impeached President Clinton. Ken Starr is about to come on our program right after you. There's speculation, there's word that President Clinton may ask to be reimbursed some $5 million in legal fees as a result of the entire exercise under the independent counsel statute. Technically he might be able to be reimbursed just as President Reagan—former President Reagan and former President Bush were reimbursed because of the Iran-Contra investigation.

Do you think it would be appropriate, A, for the president to ask for the reimbursement and, B, for the reimbursement to go forward?

MCCAIN: I don't enough about the law except to say that if I were the presidents—all presidents are very, very concerned about their role in the future and how they are judged, if I were President Clinton, I'd pay close attention to the impact of American public opinion if I took such a move.

BLITZER: OK, Senator John McCain, always good to have you on LATE EDITION.

MCCAIN: Thanks, Wolf.

BLITZER: I know you're going up to a town hall meeting in Vermont, in Burlington, right now. Wish all the people in Vermont our best regards.

Thanks for joining us.

MCCAIN: Thank you, and they enjoyed watching I'm sure. Thanks very much.

BLITZER: Thank you very much, Senator McCain.

And up next, it was exactly one year ago today that the House of Representatives voted to impeach the president of the United States. We'll talk with the man who brought the investigation of the president to Congress, former independent counsel, Ken Starr.

LATE EDITION continues right after this.

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