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Discusses His Campaign for President (Interview)

By:
Date:
Location: CNN Evans, Novak, Hunt & Shields

SHOW: CNN EVANS, NOVAK, HUNT & SHIELDS 17:30

HEADLINE: John McCain Discusses His Campaign for President

GUESTS: Sen. John McCain

BYLINE: Robert Novak, Mark Shields

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

SHIELDS (on camera): Senator John McCain, welcome, and you have said, up at before this fifth debate today many times that Governor George Bush, the front-runner on your side, is qualified and prepared to be president, but you're more qualified more prepared. Could you tell us, after five debates, what is the big difference that you see between yourself and George Bush, and how are you more qualified?

MCCAIN: First of all, I think we agree on far more things than we disagree on. I think we may have a disagreement on the use of taxes, which I'm sure that Bob will give me an intense interrogation on. I think there's probably some questions about the role of federal government education.

This business of what we do with money in Washington, I mean, I have fought against pork barrel wasteful spending all my career, and I have said. look we're going to stop it, and if we don't stop it, I'm going to make people famous that do it. I have not seen anywhere where Governor Bush would cut spending in Washington.

But, look, he's a good and fine person, and we're very friendly, and I'm pleased at the level that this debate has been conducted on.

SHIELDS: The defining difference between you then would be your willingness to cut federal spending?

MCCAIN: No, I'd say what you do with the surplus, whether you spend it all on tax cuts or whether you invest it in Social Security, Medicare and paying down the $5.6 trillion debt. But the major reason why people vote for candidates, as you know, is how they articulate vision their vision for the future, how they're going to take the confidence level.

Look, in all these five debates, if you asked average citizen in New Hampshire, what did McCain say about X, they probably wouldn't know, but what they will say, is my impression of him was that I have confidence in him. That's really what these debates are about.

NOVAK: Senator McCain, there's a lot in debate about taxes, but nobody mentioned that you support Bill Clinton's 39.6 percent top marginal rate—you don't want to cut it—whereas Ronald Reagan in 1986 thought a 26 percent top rate on taxes was good. Are you saying that Bill Clinton had it right and Ronald Reagan had it wrong?

MCCAIN: No, I believe that Ronald Reagan in very good times, when there's a growing gap between rich and poor—all studies indicate that—between the haves and the have-nots, not between the rich and the poor, between the haves and the have-nots in America, that now is the time to give the break to middle-class Americans.

If we were in bad economic times as we were then, Bob, I'd be the first to say cut marginal tax rates, because we all know that turns the economy and provides for additional investment. Right now, it is these people that are paying very heavy payroll taxes. They've got great expenses, and they need the relief in my view.

NOVAK: Senator, the career people on the Hill tell me this week that the budget—that the non-Social Security budget surplus is not going to be a trillion dollars over the next 10 years, it's going to be $2 trillion. When the next testimony comes out before Congress, there's going to be even a bigger surplus than before. Would that make you change your mind about tax cuts? And if you're not going to cut taxes, what are you going to do with all that money?

MCCAIN: Well, first of all, I—did we forget somehow? Did we get amnesia? There's a $5.6 trillion debt that we've accrued also. There's a $7 trillion unfunded part of the Social Security trust fund. I don't know—and the Medicare system is about to go bankrupt. So let's put it in that context.

I want to flatten the tax up from the bottom up. We're putting an additional 25 million people into the 15 percent tax bracket, Bob, and I would also like to give additional tax breaks wherever we need to, but to the people that need it most.

But for us to just say, Oh, look, we've got some more surpluses, everything's fine, when all these years we accumulated a $5.6 trillion debt that we still laid on young kids, that we're paying as big interest on as we're spending on defense, a Medicare system that's going broke and a Social Security system that, beginning in the year 2014, there's going to be more money flowing out than flowing in as we know.

NOVAK: One more point on that, sir.

MCCAIN: Sure.

NOVAK: The other day you referred to—in criticizing Governor Bush's tax plan, you referred to "lucky millionaires." Is that a Republican attitude, that the people who have been successful were lucky? It's all a matter of luck, not hard work and intelligence?

MCCAIN: No, Bob. If I said it, I don't remember saying it, because obviously I talk...

NOVAK: But you did say it.

MCCAIN: ... well, then the other 99 times I have said a millionaire. A millionaire under Governor Bush's plan gets $50,000. Under mine, they get $2,000. In other words, you'll get a new Mercedes under Governor Bush's plan, and I'll give you a trip to Disney World, yes.

SHIELDS: And that explains Novak's position on the cut.

(LAUGHTER)

Let me ask you this: On the question of tax cuts...

MCCAIN: Sure.

SHIELDS: ... House Republicans have cut by two-thirds their own proposal on tax cuts.

MCCAIN: Sure.

SHIELDS: Does that reflect a lack of enthusiasm, or shrinking enthusiasm, on the part of Republican voters in the country for massive tax cuts? MCCAIN: Well, I think that was displayed when we passed a—which I reluctantly voted for—the $793 billion. But I also think it reflects a realization that we really ought to eliminate the marriage penalty. I saw where Speaker Hastert said that was a top priority. There's no reason why people who are married should pay higher taxes.

The earnings test. I don't want Bob Novak to have to pay higher taxes when he works just because he's reached 65, although that was some time ago. The fact is that we would really need is to address the inequities in the tax code, try to flatten it out from the bottom up, and take as many people off the tax rolls as we can.

But I want to emphasize again, Bob, if I could: If we start experiencing an economic downturn, I'd be the first one, cut those marginal tax rates, encourage investment. Greenspan may not be a hero of some people's, but he did I think put it pretty well: He said this is great, but we ought to be a little cautious here.

SHIELDS: Let me tell you something that Governor Bush's people are saying today, right after this debate, about your tax cut, and that is, that it is unfair, and your closing of loopholes -- 151 loopholes closed. Including among them, they specify, $40 billion in cuts

NOVAK: Increases.

SHIELDS: Increases, well, that would be cut by adding to the young person who works at Gap and gets an employee discount, a cafeteria worker who gets free meals or a McDonald's worker. All of a sudden, they're going to, under John McCain's plan, have to pay taxes on that. Is that your understanding?

MCCAIN: Well, ...

SHIELDS: Is that what you're saying?

MCCAIN: No, I'm not saying that. What I'm saying is that the guy that owns the corporation isn't going to get his tax break for his golf club membership. He's not going to get his spa fees written off, and he's not going to get free parking. That's what I'm saying.

We preserve the health care benefits and most of the benefits.

This is twice now where the Bush people have mischaracterized my tax proposal and we have had to rebut it, and we go back and forth.

And so, you know what I really think this is all about, Mark, seriously, what do you do with the surplus? I take part of that surplus, put it into tax cuts for middle-class Americans. But we ought to pay down the debt, and we ought to make Social Security solvent, and we ought to recognize we need to pump money into Medicare as well. That's really what this debate is all about.

And in all due respect, both of you are pretty old geezers. We have seen those estimates change literally overnight. The same economists that are saying there's going to be tax surpluses as far as the eye can see, two years ago were saying there were going to be deficits as far as the eye can see.

I am optimistic about the future of the economy, but I'm a little nervous.

NOVAK: Senator McCain ...

MCCAIN: Sir.

NOVAK: ... you stressed that saving Social Security—you are going—you're the only candidate who takes money out of the general fund, out of the Treasury, on regular taxes are paid and put it in Social Security, $600 billion worth of it. Nobody else does that. And Franklin Roosevelt, when they started Social Security, rejected that. He said that would make it another welfare program. Do you realize what a radical step you're taking in doing that?

MCCAIN: I realize that it is going to be a radical, terrible national emergency when the trust fund goes broke. Because we really have three choices: Change the benefits, change the eligibility or raise their payroll taxes. And no economist in America, Bob, will tell you that the Social Security trust fund is solvent. They will all tell you, there is as much—their estimates are between $5 and $7 trillion that that fund needs between now and well into the next century. Otherwise, people are not going to get the benefits that they have been promised. That's what I'm trying to do, Bob.

NOVAK: We're going to have to take a break, Senator.

MCCAIN: OK, great.

NOVAK: And when we come back, we'll explore whether John McCain is still a straight shooter.

MCCAIN: Oh, God.

(COMMERCIAL BREAK)

SHIELDS: Senator John McCain, twice you've parachuted into Iowa for television events. You really don't have a campaign going here. Doesn't that kind of enable you to have it any way you want? If you get 11 votes in Iowa, you can claim victory. Isn't that true?

MCCAIN: I'd like to think that, but I think the observers are the ones who judge these things. And obviously, the dynamics with the other candidates will have an effect on it as well. But—but when we made the decision that we didn't have the assets or the time to campaign here, that there would be a penalty for that. And we'll see how big that penalty is. But there's bound to be some kind of penalty associated with it.

SHIELDS: Senator McCain, as a Navy jet pilot, you were shot down and spent five and a half years in Hanoi, as many Americans know. Donald Trump told Dan Rather this week about John McCain. "He was captured. Does being captured make you a hero? I don't know, I'm not sure."

What do you have to say to Donald Trump after a remark like that?

MCCAIN: Nothing. I think the American people will make their judgment about Donald Trump. I—there's really no point in responding to something like that. Just a lot of things are said in this world. And a lot of them you have to just ignore.

NOVAK: With your apologies—with my apologies and your permission, sir, I'd like to ask one more tax question if I could.

MCCAIN: Yes, sir. Yes, sir.

NOVAK: And that is that Governor Bush does lower the rate for the—the single mother with two children, $22,000 a year, from 15 percent to 10 percent.

MCCAIN: Yes.

NOVAK: And you've been asked this question before, but I've never really gotten an answer from you. What do you do for that woman?

MCCAIN: Well, we increase the child tax credit. And we give her—we save her Social Security. And we also increase the—eliminate the marriage penalty when she's married. And we have a provision ...

NOVAK: But she's not—the single mother's not married.

MCCAIN: ... and we give a better—and he has no provision for the stay-at-home mom. And we have it for the stay-at-home mom.

NOVAK: But the single mother is not married.

MCCAIN: So the stay-at-home mom doesn't get anything under his proposal either. But we are—ours—the reduction—with the deductions that we have, it's roughly comparable, although his is somewhat better in that particular instance.

But overall, for middle income Americans, ours is basically comparable to his. There's some where I think some people would say is better, some where others would say it's worse.

NOVAK: Senator, you'd never know it from today's debate, where the subject was hardly mentioned, but abortion is something of some importance to a great many Republicans. And I wonder right now if you will pledge if you are the nominee of the party that you would keep in the platform the 1984 plank under which Ronald Reagan ran to a landslide and has been repeated in every four years since?

MCCAIN: Absolutely.

NOVAK: With no change?

MCCAIN: I pledge it. I pledge it. I pledge it. Now I believe in that. I haven't read that platform in a long time, but I also want the message to go out that we're an inclusive party. We're a pro-life party but we're an inclusive party. It's the party of Abraham Lincoln. And we want to work together on issues such as adoption, foster care and other issues.

But no, I would not, in any way, impair the pro-life plank of the Republican Party.

SHIELDS: Senator McCain, you're standing as the captain of the Straight Talk Express, was somewhat threatened over the flying of the Confederate flag over the capital in Columbia, South Carolina. Could you tell us right now what your position is? You say, you understand the symbol of heritage. Can you understand how African-Americans could see it as something far less appealing than as a matter of heritage?

MCCAIN: Yes.

SHIELDS: And in fact, a symbol of slavery?

MCCAIN: Yes, I certainly understand that. I understand how some are offended and I can feel how some feel that it was honorable. My forbearers fought under that flag. And I'm sure that they believed that their service was honorable. But I—my point here is that in Arizona we had a huge controversy over the recognition of Dr. Martin Luther King. We fought that through. And I was pleased to be part of the fight for the recognition. We didn't like it when people parachuted into Arizona to tell us what to do. We worked it out for ourselves. And we—I think that that's important for the people of South Carolina to do for themselves.

SHIELDS: Does your position on state's rights and strict construction extend to the state judge in Florida who this week, in contravention of federal law on immigration, turned over a federal decision?

MCCAIN: Well, you know, judges do strange things.

NOVAK: This is on the ..

MCCAIN: On the Elian Gonzalez ...

SHIELDS: Elian Gonzalez, excuse me. I'm sorry. Thank you, Bob.

MCCAIN: I would like to use—I would like to use any method that I could that's legal and reasonable to keep this young boy in the United States of America. There is precedent. Back during the Cold War, there was a young man who's parents were going to take him back to then Ukraine, Soviet Union.

He sued. He was able to stay. If I had an attorney general, I'm sure that that attorney general would—maybe even Warren Rudman—would find a way.

SHIELDS: But you agree with the judge, then, who, in contravention of strict construction and Constitutional precedent?

MCCAIN: I think there's a higher issue here. The United States of America is a beacon of hope and freedom. The Statue of Liberty says, "Send me your poor, your tired, your huddled masses yearning to breathe free." This boy's mother gave her life in order that he might breathe free.

Suppose, during the Cold War a mother climbing over the Berlin Wall was shot and killed, dropped her baby into freedom. Would we say, "Send that baby back?" I don't think so.

NOVAK: Senator McCain, as far as I know, you and Steve Forbes are the only Republican candidates who fly in corporate jets.

MCCAIN: Mm-hmm.

NOVAK: Steve Forbes flies in his own.

MCCAIN: Mm-hmm.

NOVAK: You fly in other people's corporate jets.

MCCAIN: Mm-hmm. Mm-hmm.

NOVAK: Isn't that somewhat inconsistent with your attempt to be a reform Republican who is fighting the special interests when the rich fat cats give their planes to fly around the country in?

MCCAIN: Well, one, it's the only—as you mentioned, I can't afford my charter jet. Nor can I have Air Force II. And because I'm restrained in the amount of money that I can get, I don't have that money. So the only way I can make my schedule is that way. And I understand that—as I said, in this whole issue of campaign finance reform just about everything we do is under suspicion. And it makes me suspicious as well.

NOVAK: But don't you feel—I guess the question I'm asking you is...

MCCAIN: ... Mm-hmm. Mm-hm.

NOVAK: ... that you—since you are such a strong advocate of campaign finance reform—that you ought to be under some much tougher prohibitions and restrictions than the other people? And yet you act the same as the other senators in sending out letters to people, on behalf of people, who have given you contributions?

MCCAIN: I didn't send out any letter on behalf of people who gave me contributions. I sent out a letter asking them to make a decision in the case of someone who had given me a corporate contribution. There is a significant difference.

But I want to point out again: Americans are suspicious of us because they see the influence of all this money floating around Washington, hundreds of thousands of dollars.

The Republican Party's going to take seven million dollars from the tobacco companies. I'm not particularly proud of that.

And so I'm tainted by it and by whatever I do. And it increases my vigor to try to obtain true campaign finance reform.

NOVAK: OK. We'll have to take another break.

MCCAIN: OK.

NOVAK: And when we come back we'll have "The Big Question" for John McCain.

(COMMERCIAL BREAK)

NOVAK: "The Big Question" for Senator John McCain: Senator, the polls show you and George W. Bush just about neck and neck in New Hampshire. Maybe you're slightly ahead. If you lose that primary election, will you then fold up your tent and say there's no hope?

MCCAIN: I wouldn't fold up, Bob. And I think this is going to be very close. And a substantial number of people in New Hampshire haven't made up their minds. In fact, as you know, they'll change it three or four times between now and them. I think it's going to be very close. I think we're still the underdog because we're so heavily outspent.

But, first of all, the win is in the view of people like you and Mark, you know, what is winners and losers. But second of all, no, we would certainly go on to South Carolina because we are building a good organizational base there. But again, in straight talk, it would be a devastating blow if we lost badly, sure. If in your, you all's view, McCain is a loser coming out of it, absolutely.

SHIELDS: But if you lose by a close margin, you don't think that's a big setback?

MCCAIN: Again, it depends on the expectations that you have. But I would imagine that a fairly close race either way would probably not be too damaging to either one of us, I wouldn't think.

SHIELDS: Senator George Mitchell, like yourself a campaign finance reformer when he was in the Senate, made the comment the other day that he felt that the press unfairly held to a higher standard of scrutiny people who where campaign finance advocates. He felt the same thing himself. Do you feel that has been true in your case

MCCAIN: I think that life isn't fair. I think that Mr. Novak's insults that he's hurled at me all these years have kept me awake many nights. But the fact is, Mark, these things happen. This is part of the business we're in. And I think you just move on. You recognize that some of them may hurt you. But that—that's—the one thing you can't do is be diverted by those.

But, no, I think, overall the media has been fair to me in this campaign. And so I have no complaints.

SHIELDS: Thank you, Senator John McCain.

MCCAIN: Thank you.

SHIELDS: My partner, Robert Novak and I will be back in a moment with a comment.

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