CNN Late Edition

Rudy Giuliani Refuses to Commit to Senate Bid, but Indicates He Intends to Run; George W. Bush Going Negative on McCain

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, 6:00 p.m. in Vienna, Austria, and 7:00 p.m. in Jerusalem. Wherever you're watching from around the world, thanks for joining us for this 90- minute LATE EDITION.

We'll get to our guests shortly, but first let's take a look at a top story that we're following at this hour. Last night, another frightening incident involving an Alaska Airlines MD-80 jetliner. Flight 631 had just taken off from Reno, Nevada en route to Seattle when it was forced to return to Reno after the pilot reported a problem with the horizontal stabilizer on the tail of the aircraft. Flight attendants put on their life jackets and explained crash procedures. The plane landed safely and no one was injured.

The horizontal stabilizer, the same part feared to have caused Monday's crash of Alaska Airlines Flight 261 off the Carolina coast -- California coast, killing all 88 aboard. Searchers have located the plane's tail section, and investigators hope the recovery of the horizontal stabilizer will help isolate the cause of the crash.

On Tuesday, an American Airlines MD-80 made an emergency landing in Phoenix, after reporting trouble with its horizontal stabilizer. No one was hurt in that incident.

Joining us now for some perspective on all of this is the former FAA chief of staff, Michael Goldfarb. Mr. Goldfarb, thank you so much for joining us. All right, give us your perspective. This is the third incident in only a few days involving an MD-80 with the horizontal stabilizer. What's going on?

MICHAEL GOLDFARB, FORMER FAA CHIEF OF STAFF: Well, first of all, Wolf, we don't want to second- guess either the board or the FAA. We don't know yet what caused the tragedy off the California coast. So having said that, I think that we have some pilots now who are actually taking advantage of the knowledge of that crash to hopefully prevent future incidents. I know last night, for example, that apparently the pilots on the runway were testing the stabilizer using the motor to see if in fact it was working, and may have led to it overheating which may have caused the problem. The American Airline plane in Arizona, I believe, it was an electrical connection.

After crashes, we often see this kind of behavior -- reports of two or three or four more things related to the very problem that caused the crash, and many times it's simply a heightened vigilance on the part of the aviation community to the problem.

BLITZER: Explain to our audience what this horizontal stabilizer really is.

GOLDFARB: It simply balances the flight. The trim on it allows -- in case the plane shifts in weight or there's turbulence, it allows for smooth flight. It's in the back, it's a little wing on the tail. And in effect, you know, we've never had a crash attributed simply to a stabilizer and its trim.

Something called a runaway trim is perhaps the issue here where the pilots got out of ahead of them, they didn't know how to bring it back. They have procedures, using the elevator panels to retrieve it or the yoke of the -- in a cockpit, to hopefully compensate for it. So, it's a first of its kind reported problem that we haven't had before.

BLITZER: All right, the new issue of "U.S. News and World Report" does have an extensive report on what happened with the Alaska Airlines flight, but among other things I want to read to you a paragraph of what it says in that article.

Last May, the Federal Aviation Administration gave U.S. airlines 18 months to inspect more than 700 MD-80s for signs of stabilizer corrosion. Alaska Airline says it began the inspections on its fleet of 35 MD-80s immediately. By January 31st of this year, it had completed 10 and found, quote, "nothing of significance." Unfortunately, aircraft M963AS, Flight 261, wasn't scheduled for its check until June. That was the plane, of course, that went down off the California coast.

Why does it take 18 months to check these planes, these MD-80s, for what is called -- what they call stabilizer corrosion?

GOLDFARB: So the traveling public doesn't get nervous about this, let's provide some perspective on it.

There are hundreds of service bulletins, like when your car says service your engine soon. These are routine reports. Every aircraft flying today has service bulletins associated with them. They're not considered to be airworthiness directives, the next level of concern, where the government orders immediate or near-term fix. They're considered to be things that say "at your next maintenance cycle, these things need to be looked into."

Now, why isn't there more alarm about corrosion? Corrosion -- in Alaska Air and planes that fly over oceans, over saltwater, often have parts that become somewhat corroded. Corrosion itself has never been a cause, except for the Hawaiian Airlines many years ago where the structure actually fell apart, of a crash.

So it was the judgment of investigators, given the past history, Wolf, what we haven't had accidents of this sort -- just like the TWA crash where the center fuel tanks never exploded. It never happened in 30 years, so there was no prior knowledge to make it become a more serious alert on the part of government, and hence the 18 months.

BLITZER: So very quickly, if you were flying an MD-80 or one of our viewers about to get on MD-80 would you -- should you be scared at all about getting on that plane?

GOLDFARB: This best time to fly an MD-80. After this kind of problem, I would not be scared at all and most people who get on one this afternoon. We may find some nervous pilots -- good. And they may take the compensation necessary if they have even minor problems, that under normal situations, Wolf, they would just solve with talking to ground control and their own mechanics base and you would never know about it.

BLITZER: OK, Michael Goldfarb, former chief of staff of the FAA. Always good to have you on LATE EDITION. Thanks for joining us.

And now let's shift gears and talk about our top story at this hour. In fact only about three hours from now, the first lady, Hillary Rodham Clinton, is scheduled to officially launch her campaign for the U.S. Senate.

CNN's senior White House correspondent, John King, is at the state university in Purchase, New York, where Mrs. Clinton will make her announcement.

John.

KING: This is not your everyday Senate campaign announcement. National media here, international media here, as well as the New York media. Secret Service protection, obviously, for the first lady and the president.

Inside, arrangements going on for what the first lady hopes will not only be her formal campaign announcement, but what she told "The New York Times" in an interview today -- the beginning of a reintroduction. She believes she has been misunderstood and mischaracterized as she has explored her run for the Senate.

Today, as she announces, she hopes to reintroduce herself. In part -- part of that effort will be an 18-minute biographical video as well as 400,000 biographical fliers being distributed across the state.

Now, the first lady's major issues in this campaign will be education and health care, Medicare and saving Social Security -- very much the national Democratic agenda.

But as she campaigns against Mayor Rudy Giuliani, she also hopes to make the mayor's temperament an issue. He is known as a controversial combative figure, and in the words of Howard Wolfson, the first lady's spokesman, not a man suited to serving in the United States Senate.

(BEGIN VIDEO CLIP)

HOWARD WOLFSON (?), HILLARY RODHAM CLINTON SPOKESMAN: New Yorkers wonder whether or not this is someone who could effectively serve in a body like the Senate in which people have to get along. When the mayor is confronted with a problem or disagreement, his first instinct is to either fire someone or sue someone.

(END VIDEO CLIP)

KING: Now, the first lady, very much like her husband describing herself as new Democrat, a moderate Democrat. She says she supports a balanced budget, supports welfare reform, supports capital punishment but look for in the campaign ahead the mayor to try to portray her more as a traditional liberal. In the words of Bruce Teitelbaum, Mayor Giuliani's campaign manager, Mrs. Clinton is not a new Democrat but an old style tax-and-spend liberal.

(BEGIN FILM CLIP)

BRUCE TEITELBAUM, RUDOLPH GIULIANI'S CAMPAIGN MANAGER: The mayor believes in smaller government, less taxes, more power to people. Mrs. Clinton believes in higher taxes, giving less control to people over their lives, more control to government.

(END FILM CLIP)

KING: We are told the president will have no speaking role in today's event although he did help the first lady craft her announcement speech, and has been advising her for months. The president still has a 64 percent approval rating here in the state of New York though, so aides does not expect the president to be in the shadows. Instead, they do expect him to have a very active role both behind scenes and in public, as the first lady begins her historic campaign for the United States Senate.

BLITZER: John King in Purchase, New York. Thanks for joining us.

Mrs. Clinton's likely opponent, of course, is the New York City mayor, Rudy Giuliani. Within the past hour I spoke with the mayor about the upcoming Senate race.

(BEGIN VIDEOTAPE)

BLITZER: Mr. Mayor, welcome back to LATE EDITION. Always good to have you on our program.

RUDOLPH GIULIANI, MAYOR, NEW YORK CITY: Thank you for having me.

BLITZER: You know that the first lady is announcing later today she is a candidate for the U.S. Senate from New York state. When will you make that formal announcement or will you make the formal announcement?

(LAUGHTER)

GIULIANI: I don't know. I have a superstition about this. In 1989, when I ran for mayor, I lost after I announced. And in 1993, I forgot to announce. And then in '97 I didn't announce and I won by a landslide. So I don't know.

And also you know I'm mayor of New York City. I have a very, very demanding full-time job and I would like to shorten this campaign as much as possible. So from my point of view, I guess one of the pluses that I have is being the mayor of the city. I have a record. I have a proven record of success. I come from the state. Mrs. Clinton has the plus of having a lot more time for political campaigning.

BLITZER: So just to be on the safe side, as far as other Republicans maybe thinking about running for this race, you will be a candidate. There's no doubt about that.

GIULIANI: Well, there's always doubt. I mean, you know, otherwise I might as well make some kind of a Hollywood-style announcement of some kind or other.

But right now, you know, it's very much the direction we are moving in. We've raised over $12 million. We have 90,000 donors. We've got a large organization that's developing with a tremendous amount of support. And the thing I like best about the 90,000 donors is the average donation is $108, which means there's a tremendous amount of broad-based support from all different people.

BLITZER: By all accounts, this is probably going to be most expensive race ever for a Senate seat from any state in the country, and obviously you are gearing up for that contest. What, in your opinion, will be the single biggest issue in this race between you and Mrs. Clinton?

GIULIANI: I think the single biggest issue in this race will be single biggest issue in any race, who the public trusts more to represent them, who does the public think is going to do a better job in this particular case of representing the state of New York in the United States Senate, who can fight more effectively for the state, who can advocate the positions that we need in New York?

We as New Yorkers send $15 billion more to Washington than we get back from Washington. Senator Moynihan points this out every year. Who do the people of the state trust to get more of that back for us, so that we have the kind of job growth in upstate New York that we have now in downstate New York?

I think ultimately it's bigger than any one issue or any one personality. It's a sense of trust that people have to have. And I guess what I would say to them is, in my case, they have a record of public service in the state of New York for a very long time. First as U.S. attorney, then as the mayor of the largest city in the state with results that I think many people agree with. Some people probably disagree with.

BLITZER: So as far as you're concerned, the carpetbagger issue, the fact she has come to New York, established residency relatively late -- very late in her political career, that's still an issue as far as you are concerned. GIULIANI: It's an issue as far as voters are concerned. The issue for me, I'd put in a more positive way: Who do the people of the state think can do better job of representing them in the United States Senate?

Which one of the two of us, or three of us or four of us can do a better job of rejuvenating job growth throughout the state the way I've done in New York City, or reducing crime the way I've done, or reducing welfare by 540,000. Those are the kinds of things that I think ultimately lead to the final conclusion, when the voter goes into the voting booth and says, this is the person that I want fighting for me and representing me in United States Senate.

BLITZER: In the interview that she granted "The New York Times" today, you probably had chance to read it, on front page of the "New York Times," among other things, she said this about you in effect, and your potential campaign. She said, "I don't think the Republicans need any more votes to block campaign finance reform or turn back the clock on our budget and deficit policies. Or to side with the majority of Republican leadership on issues ranging from school vouchers to whether or not we deal with health care in a step by step way to try to eventually reach a goal of providing quality, affordable heath care for everybody."

In other words, what she's trying do, is lump you in with the Republican majority in the Senate, and tell New Yorkers, if you want that Republican agenda to go forward, vote for Rudy Giuliani. If you want a more moderate Democratic agenda to go forward, vote for Mrs. Clinton.

GIULIANI: Well, I think, you know, again, I have the advantage or disadvantage of a proven record as mayor of New York City and I think, almost anyone, other than people who like to do like the Clinton campaign did last week, that I'm part of the vast right-wing conspiracy -- that was the charge of the week last week. I've had a record as a moderate mayor of New York City. I'm a Republican, I believe in the principles of the Republican Party. I'm able to disagree with my party, when I think it's in best interests of the people that I serve.

For example, on campaign finance reform, I'm a very, very strong supporter of Campaign Finance Reform. A very strong supporter of McCain-Feingold for a long, long time now. I was the first Republican in the state to urge that the primary be open, and John McCain be allowed in the primary, and I had a lot of Republicans angry at me.

The fact is, I support George W. Bush, support him very, very strongly. I hope that he's the next president of the United States, and I'm doing everything I can to campaign for him. But I felt that it was fair that John McCain be allowed in the primary, who I also have great respect for. So, I've shown the ability, not just talk about it, not just promise it, not just do Hollywood style commercials saying I'm going to do it, but I've shown that I can be independent when I believe it's in the best interests of the people of my state to be independent. Though I think can be pretty hard to do this vast right-wing conspiracy thing on me when in fact, I've shown that I can that I can make decisions that are in best interests of my state. It's also going to be pretty hard when you look at my fund-raising and you see that people like Colin Powell have donated in my campaign, and Henry Kissinger, and Bette Midler and we have a lot of support. And maybe a lot of that support comes from the fact that they think I've done a good job as the mayor of New York City and I can -- based on that -- I can do a good job as a senator.

BLITZER: Well the other argument they make, the supporters of Mrs. Clinton in New York state, I'm sure you've heard this argument, is that yes Rudy Giuliani is a moderate Republican, he has positive positions from their standpoint on a whole bunch issues including those that you just mentioned. But, by putting another Republican in the Senate, you help strengthen the chances that the Republicans will maintain the majority, that Orrin Hatch for example will continue to be chairman of the Judiciary Committee with his position against abortion rights, with his position against gun control, that Jessie Helms will be chairman of the Senate Foreign Relations committee, with Bob Smith of New Hampshire, chairman of Environment Committee. Rudy Giul -- a vote for Rudy Giuliani guarantees that those Republicans will be in charge.

GIULIANI: A vote for Rudy Giuliani guarantees that Rudy Giuliani will represent the state of New York in the United States Senate. All that partisan politic stuff, that's all the Washington inside-Beltway sort of stuff that I think very much afflicts and infects the other campaign.

I look at it from a different point of view. If I go to Washington representing the people of the state of New York, I'll will try do the same thing with that that I have done as mayor of New York City. We'll do it in the best interests of the people of the state.

Maybe it would help the state to have a strong voice in the Republican majority in the United States Senate. Maybe that's one way to get that $15 billion, a lot more of it back to us.

New York, again, sends $15 billion more to Washington than it gets back from Washington. Arkansas gets $3 billion more from Washington. So in essence, New York is sending and subsidizing a lot of what the federal government does.

A strong presence in the majority party in the Senate could very much help the state, particularly the areas of the state like Buffalo and Erie County and Monroe County, and Rochester, which is within Monroe County, and Binghamton and Albany.

All these places all throughout the state, they're all entitled to the kind of benefits that other states get, and a senator who can represent in majority party -- maybe that is an advantage rather than a disadvantage.

BLITZER: So you would be about willing to go up and fight those more conservative Republicans on those kinds of issues that are... GIULIANI: You can't -- Wolf, you can't have it both ways. One of the attacks that they make every other day is: The mayor is too much of a fighter; he's too tough.

The other attack that they make is: Oh, gee, he's just going to do what Republicans tell him to do.

Well, maybe the reality is that I'm an independent person, I believe in Republican principles, but I'm pretty good at advocating; I'm pretty good at getting for the people that I serve the things that they need.

So I think that the idea that I could be part of the majority party actually is something that's helpful to people of the state.

BLITZER: Well, on that specific issue, Bill de Blasio -- he's the campaign manager for Mrs. Clinton's campaign. He was out earlier in the week appealed and appealed to you to use your influence with some of those more conservative Republicans to call off the dogs, if you will, in their campaign against Mrs. Clinton. Listen to what Bill de Blasio said earlier in the week.

(LAUGHTER)

(BEGIN VIDEO CLIP)

BILL DE BLASIO, HILLARY RODHAM CLINTON'S CAMPAIGN MANAGER: Today we are calling on Rudy Giuliani to disavow his archconservative allies. Mr. Mayor, tell your friends on the far right to stop their campaign of lies and deceit. Right-wing groups have made Hillary Clinton their No. 1 target.

(END VIDEO CLIP)

BLITZER: Are you prepared to accept that kind of advice?

GIULIANI: I actually can't believe that, Wolf. I actually can't believe that tape. I mean that -- I think I heard that a year ago, the "vast right-wing conspiracy," and the right wing is making her the target of attack and making the president the target of attack.

You know, look, I happen to be a Republican who has my own views, my own viewpoint. I think I have been on your show when you have asked me how can a moderate -- you even called me liberal Republican -- as me succeed in the Republican Party. So this is like a script done in Hollywood, which they're going to repeat and repeat and repeat, and the more often even they get all you to fall for it, the better it is.

The reality is that I'm responsible for what I say. If there are groups out there trying to take advantage by raising money by calling Mrs. Clinton this and calling me that -- because it happens the other way around with this whole "vast right-wing conspiracy" thing -- I disavow all of it. But no it matter whether I disavow it or not, they're going to continue to go it. That's American politics, and it depends on how spun you can get by this trick. But I mean, this is like last year's playbook, "vast right-wing conspiracy," "they are after us." Come on.

BLITZER: All right.

GIULIANI: This is a campaign about who can be a better senator in the state of New York. And my campaign is going to be based on what I have done as mayor, what I have achieved for the city of New York, and then to say to people of the rest of the state: If you like that, vote for me; if you think I can do that for you; vote for me. And if not, you certainly have a right to vote against me.

BLITZER: All right, Mr. Mayor, we have to take a quick break but we have a lot more to talk about.

When we return, more on the New York Senate race. Plus, I'll ask Mayor Giuliani how his man in the Republican presidential race, Governor George W. Bush, can get back on track after his disappointment in New Hampshire. LATE EDITION will continue right after this.

(COMMERCIAL BREAK)

BLITZER: Welcome back to LATE EDITION. We're continuing our conversation with New York Mayor Rudy Giuliani. Mr. Mayor, if you were the United States senator from New York, what two committees in the Senate would you most want to serve on?

GIULIANI: Well, I probably haven't made that decision yet. I think that Foreign Affairs would be one that I could make a very, very big contribution. I think that the committee I worked with most in my prior experience in the Justice Department as associate attorney general in Reagan administration was the Judiciary Committee. So I probably know the workings of the Judiciary Committee probably better than any other.

That is probably something that you really have to wait until you get there, and hopefully get there, and decide what's in your best interest, the best interests of the Senate, the state. Where can you make the biggest contribution? But the one I have had most experience with was the Judiciary Committee. I worked with them for five years at different times.

BLITZER: OK. Let's talk about some of the issues that you would have to confront if you were a United States senator. Issues for example that President Clinton raised in his State of the Union Address, that 90-minute speech that he gave. I just want to nail down where your positions are, for example, on increasing the minimum wage.

GIULIANI: I favor increasing the minimum wage. I think you have to look at the level to determine what impact you are going to have on jobs, particularly at a point where we have this tremendous welfare to work social movement going on. We have -- in New York we have 540,000 fewer people on welfare since I started Welfare reform and 380,000 new jobs. So you've got to take a look at it, but I would be very much in favor of increasing. BLITZER: On a patients' bill of rights, do you favor a patient -- if this patient was given bad treatment by a doctor, having an opportunity to sue that doctor?

GIULIANI: No question about it. I think there should be the ability of a patient to recover if they are hurt, if they are harmed. I think we also have to have tort reform, so that the recovery actually goes to patients who are truly harmed and truly hurt and isn't abused and isn't misused in -- in this particular situation I have the advantage of a lot of experience.

New York City runs the largest public hospital system in the country except for the Veterans Administration. We pay out something like $300 million in judgments. Some of them justified. Some of them, unfortunately, the product of a tort system that really is desperately in need of reform. So the answer is yes, a patient who is harmed should recover, but the answer also is we should look at this system make sure that a lot of the abuses where a lot of people are getting a lot of money not entitled to are also cleared up.

BLITZER: On several other issues that the president put forward as his agenda, you support him, for example on the licensing of handguns.

GIULIANI: Actually I should tell you I have been in favor of that long before the president said that. I mean, I've been in favor of it since 1980-1981. The idea that we should have a uniform law, a uniform set of requirements, much like we do for driving an automobile. So that right now we don't have that. So that if people have a handgun, they can display like people have to drive automobile, that they are able to use the handgun, that they can take a written test, pass a test in terms of character and fitness. Yes, those are things that I -- it isn't because the president said it. I have been in support of that since 1980-1981 when I first started testifying about it before the Senate.

BLITZER: If you were in the Senate and he vetoed, once again, the so-called partial-birth abortion procedure, you would vote against sustaining that against the -- in favor of the veto in other words, you would support the president on that.

GIULIANI: Yes. I said then that I support him, so I have no reason to change my mind about it.

BLITZER: All right. So the bottom line is that on a lot of these very sensitive issues whether on guns, abortion, patients' bill of rights, taxes, you are more in line with the president and by association, with Mrs. Clinton, than you are against them.

GIULIANI: Well, I think actually President Clinton would tell you that I'm one of the -- one of the people that helped get the crime bill passed by -- by arguing in favor of it and because I felt it was helpful to my city and my state.

However, there are areas of vast disagreement. I believe that there should be a substantial tax cut and that the tax cut should focus heavily on the capital gains tax. It should focus heavily on the income tax as the way of recovering for New York the $15 billion more that we are sending down to Washington that we're not getting back. That's an area in which Mrs. Clinton and the President have been very, very much on the other side. So there -- I believe largely in not having large government programs, large government solutions to problems.

I've reduced the size of government in New York City dramatically. I have reduced taxes by over $2.4 billion. Those are areas in which there is almost instinctual difference between a large government program to solve a problem, and I heard a lot of that in the president's speech.

And on the other hand, much more subtle solution like the welfare reform that we've done, which gives people a job, as the very, very best social program rather than a government program.

BLITZER: Your candidate in the presidential race, Governor Bush, seems to be in trouble right now. He got trounced in New Hampshire. The polls in South Carolina show that McCain is slightly ahead of him, although he was way behind only a few weeks ago. What advice -- what should Governor Bush be doing now if he's going to get the Republicans nomination?

GIULIANI: I think he should -- I think as Governor Bush knows, because I know him well, and he's a very, very strong man, he's a very, very intelligent man. I think Governor Bush should just look back on the other president primaries and remember today is Ronald Reagan's birthday. Remember that Ronald Reagan lost the prim -- the caucuses in Iowa, and his campaign was in a disaster. He was then running against later President Bush and Vice President Bush, and he was able to regroup, put it together and become a very, very strong candidate.

I remember President Clinton being in trouble in the Democratic primary when he came into New York seven years ago -- eight years ago, and the reality is he was able to put it together. These campaigns go through ebbs and flows, ups and downs. Mrs. Clinton was ahead of me by 18 points a year ago at this time. Polls now have me ahead of her by seven points.

Before this is over, this thing will change five times. She'll be ahead by a lot, I'll be ahead by a lot; it'll be back and forth, and I think George W. Bush should do what he does really well. He should point out what he's done as governor of Texas. He should point out that his executive experience really puts him in a position to be president of the United States. He's run one of the most complex, one of the most difficult governments in the country, the government of Texas, the third or fourth largest government. He's done it by bringing in good people, by learning how to delegate the way Ronald Reagan did. I see a lot of similarities there to Ronald Reagan when he was governor of California running, and the style that he had and the style that Governor Bush has.

BLITZER: We, unfortunately, Mr. Mayor, have to leave there it. Rudy Giuliani supporting George W. Bush, no huge surprise there. But thank you so much for joining us on this day that Mrs. Clinton makes her formal announcement. And if you someday decide to make a formal announcement, we hope you'll join us on LATE EDITION once again.

GIULIANI: Or I may do it in the middle of the night.

BLITZER: We'll be available if you are. Thanks so much, Mr. Mayor.

GIULIANI: All right.

BLITZER: And be sure to stay with CNN this afternoon as Mrs. Clinton officially declares for the U.S. Senate. The announcement is scheduled for 3:00 p.m. Eastern, noon Pacific, and CNN, of course, will carry it live.

Up next -- crunching the numbers. Who's ahead in the much anticipated Clinton-Giuliani New York Senate contest? And where do Bush and McCain stand with South Carolina voters heading into that state's primary? We'll go over some new poll numbers and what they mean with CNN senior political analyst Bill Schneider. LATE EDITION will be right back.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

HILLARY RODHAM CLINTON, FIRST LADY OF THE UNITED STATES: I believe that if we work together we really can make a difference for the children and families of New York. So the answer is, yes, I intend to run.

(APPLAUSE)

(END VIDEO CLIP)

BLITZER: First lady Hillary Rodham Clinton speaking to supporters in New York City late last year. Welcome back to LATE EDITION.

Joining us now to help sort out the latest polls on the New York Senate race and the Republican presidential contest is CNN senior political analyst Bill Schneider.

Good to have you on LATE EDITION. Thanks for joining us.

All right, Bill, where does it stand, the New York state Senate race right now?

WILLIAM SCHNEIDER, CNN SENIOR POLITICAL ANALYST: Neither candidate has the majority, Wolf, but Rudy Giuliani is running seven points ahead of Hillary Rodham Clinton. Forty percent for Mrs. Clinton in New York is not good.

Here's something else that's not good news for Mrs. Clinton: Look at women voters in New York State. They are evenly split between Hillary Clinton and Rudy Giuliani. Again, she should be doing much better among women voters.

She's showing particular weakness among upstate New York voters -- that's in obscure places like Buffalo. They're voting only one- third for Mrs. Clinton, and she's going to be spending a lot of time up there in the next week or two because she has to shore up her support with -- in upstate New York, the carpetbagger issue really hurts her. It doesn't matter so much in New York City, but upstate it's a problem.

BLITZER: Forty-four, 43 for Mrs. Clinton among women; it's a serious problem obviously for Mrs. Clinton.

So what kind of strategy should Mrs. Clinton be pursuing against a very moderate Republican? We just heard from Rudy Giuliani.

SCHNEIDER: Well, look, when you asked him what is the issue he's going to run on, he just said it is who voters trust to represent the interests of New York. They believe he understands the interests, certainly of the city, and of New York, because she's never lived there and worked there.

She's running more on a national agenda, and that could be a mistake. She has to make it clear to the voters of New York: Your agenda is my agenda.

To try to portray Rudy Giuliani as some sort of right-winger who's going to go in lockstep with the Republicans in Congress is a little crazy. Number one, he is not a right-winger; number two, Giuliani doesn't go in lockstep with anybody.

BLITZER: All right. So from New York state, nationally, the presidential contest has obviously heated up. South Carolina, February 19th -- what are latest poll numbers, first of all, in South Carolina, between George W. Bush and John McCain for that Republican nomination?

SCHNEIDER: Well, the latest poll numbers we have in South Carolina show McCain edging just a little bit ahead of George Bush. Too close to call: McCain 44, Bush 40.

But remember, there are a couple other candidates. Alan Keyes is getting 5 percent; Steve Forbes, 2 percent. Add those together, that's 7 percent. That would be enough to put Bush over if they got out of the race or their votes shrank and it went to George Bush.

Now, why is this happening? Well, South Carolina is an open primary. Democrats and independents can vote in that primary. There is no Democratic primary on February 19th.

Among people who describe themselves as Republicans, Bush is running ahead. It's among non-Republicans, which is to say Democrats and independents who are choosing to vote in that primary, that McCain has a big lead.

But notice something: Only 50 percent of the Republicans are voting for Bush. He doesn't have this solid base that you might expect.

A lot of people say, Well, the conservatives will rally behind George Bush and make sure he gets the nomination. Let's take a look at conservative voters. They're voting for George Bush, but only 47 percent of them. They're not solidly in Bush's corner.

Non-conservative voters -- moderates and even a few liberals, they're over a third of the voters in South Carolina -- are voting for McCain. But you can't say that John McCain has built up a -- I'm sorry -- that George Bush has built up a solid wall of conservative support. They don't really trust Bush. They don't trust McCain either, but Bush is not their hero. He's not Ronald Reagan.

BLITZER: And this footnote: There's no indication at all that either Alan Keyes or Steve Forbes is thinking of jumping out of the South Carolina context.

SCHNEIDER: No, no. But the Bush people would love to get their votes, because they could make the margin of difference.

BLITZER: Why is John McCain booming right now?

SCHNEIDER: Wolf, because he's the un-Clinton. His bus is called The Straight-Talk Express. He knows what the meaning of "is" is. He talks straight to the voters.

Number two, he's attacking the role of big money in politics. Bill Clinton is associated with big money in politics.

He's a military hero, and Bill Clinton's military record is non- existent.

On all those grounds he appeal to voters because he's so different from President Clinton.

BLITZER: Very interesting. All right, Bill Schneider, our senior political analyst. Always good to have you on LATE EDITION. Thanks for joining us.

SCHNEIDER: Thank you.

BLITZER: And just ahead: In politics, it's known as the "big mo" -- momentum. And Arizona Senator John McCain has it this week after his huge win over Governor Bush in the New Hampshire primary. We'll talk about the dramatic shift in the Republican presidential race with Bush supporter Haley Barbour, and McCain's strategist Mike Murphy.

LATE EDITION will be right back.

(COMMERCIAL BREAK)

BLITZER: In a minute we will be right back with politics -- presidential politics, and Bush supporter Haley Barbour, McCain strategist Mike Murphy.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

GOV. GEORGE W.BUSH (R-TX), PRESIDENTIAL CANDIDATE: This is a man who has been in Washington for a long enough period of time, where he is now chairman of a very important committee he used his position skillfully to forward his campaign.

SEN. JOHN MCCAIN (R-AZ), PRESIDENTIAL CANDIDATE: With all due respect, I think it is beginning to show a little sign of desperation.

(END VIDEO CLIP)

BLITZER: Bush versus McCain, trading barbs on the campaign trail this past week. Welcome back to LATE EDITION.

We now get two perspectives on how the Republican race as it's unfolding. First of all, joining us from Detroit is Mike Murphy, campaign strategist for the McCain campaign. We'll be joined shortly by Bush supporter and former chairman of the Republican National Committee, Haley Barbour.

First of all Mr. Murphy, you've seen the attacks now going forward on John McCain from many in the Republican establishment. In fact earlier today, on "Fox News Sunday," the former governor of South Carolina -- there will be this critical primary coming up there on February 19th -- Governor Campbell was very, very strong in going after your candidate, John McCain. I want you to listen to what Governor Campbell had to say.

(BEGIN VIDEO CLIP, "FOX NEWS SUNDAY")

CARROLL CAMPBELL (R), FORMER GOVERNOR OF SOUTH CAROLINA: What I see is a man that is talking literally out of both sides of his mouth. He is saying that, I'm for campaign finance reform, come before my committee, and let me get some money from you, and then we'll go talk about things.

(END VIDEO CLIP)

BLITZER: Strong words from former Governor Campbell, Mike Murphy.

MIKE MURPHY, MCCAIN CAMPAIGN STRATEGIST: Oh, it's amazing. There's a tremendous panic spasm going through the Republican establishment here because this whole campaign is about the conservative reform agenda of John McCain at the grassroots versus the power brokers of the party. And a couple of hundred guys at the top of the Republican Party don't want John McCain. They want to shove Governor Bush's candidacy down the throats of the voters and it's failing, because the Bush campaign was so overwhelmingly rejected in New Hampshire -- it's being rejected in other states now.

So instead of having any kind of positive message about George W. Bush, that's all gone out the window and they've gotten out the attack and smear campaign. Luckily for us it is back-firing. People know John McCain is a conservative, they know he is a reformer, and they like the fact that he is taking on the Republican establishment that is far, far out of touch with the grass roots of our party.

BLITZER: Well, why do you think the George W. Bush campaign in New Hampshire, did as poorly as it did do?

MURPHY: I think it was couple of things. Number one, for a year, all of 1999, the two biggest stories in politics or in the world were Y2K, and George W. Bush has already won this campaign; it's over. He raised all the money, he has all the endorsements.

But then the voters showed up in New Hampshire, and they took a look at both candidates, and they decided overwhelmingly that McCain is far better qualified for president, has a much stronger vision. I think they like the McCain vision and I think they're trying -- they tried in New Hampshire to figure out what the Bush vision was and they couldn't really find one.

And I think the real problem the Bush campaign has is they've got a lot of generals and a lot of insiders; they don't have any message. They're not convincing voters that he's a guy who ought to be president and lately -- this is the amazing thing, because it is true, but it's turned the race upside down -- people in the Republican Party are understanding now that George W. Bush is going to lose big to Al Gore. He is not Mr. Inevitability. In fact, he's starting to look like Mr. Stone Cold loser.

So even some Republicans establishment figures are coming over to John McCain because they see him as candidate with a strong message who can unite our party and take us to victory.

BLITZER: It seems, though, that George W. Bush is getting much more aggressive in going after John McCain, not only Bush supporters, but the governor himself.

In fact, look at this new ad that the Bush campaign is now airing in South Carolina.

(BEGIN VIDEO CLIP)

ANNOUNCER: John McCain's ad about Governor Bush's tax plan isn't true and McCain knows it. McCain's economic adviser says he'd support Bush's plan, $2 trillion to protect Social Security, pay down debt and a real tax cut. McCain's plan? A tax cut smaller than Clinton's.

(END VIDEO CLIP)

BLITZER: Those are fighting words -- a tax cut that McCain supports smaller than Bill Clinton's tax cut.

MURPHY: It's amazing and it's totally untrue. The McCain tax cut is twice the size of Clinton's tax cuts. That's a Clinton ad; it twists the truth so much you want to yell uncle.

And it's amazing because Governor Bush started his campaign of a TV ad saying, You know one thing I can't stand are negative ads. Then he had a handshake with John McCain -- Let's agree not to run negative ads. And now here comes the first blistering and totally inaccurate ad of the season. I think it's going to backfire on Governor Bush, and, again, there's a real desperation in that campaign.

I think the new issue of "Time" magazine has a fascinating story, about when the Bush campaign landed in South Carolina -- after getting trounced in New Hampshire -- the first thing they did was go into a secret meeting with the Big Tobacco folks and the various soft money groups trying to coordinate a multi-front smear campaign against McCain. This isn't going to work and people are going to get upset about it.

BLITZER: So, what is your strategy in South Carolina right now? The McCain strategy -- first of all, do you see yourselves now as the front-runner in South Carolina? Three polls in the last few days all have McCain slightly ahead of George W. Bush.

MURPHY: Well, I think we see ourselves as a people's candidate because of our message. I don't know about front-runner. This thing is going to go back and forth and the next two weeks you're going to see some of the most inaccurate smear jobs ever tried to -- be inflicted on a politician.

We're running on the McCain message. We're talking about getting the big money out of politics with campaign finance reform. We're talking about who is best prepared on day one to be commander in chief, and we are talking about a way to use the surplus money that's common sense, conservatism; a balanced plan where you have to save Social Security from the financial trouble it's heading toward, which would mean a big payroll tax increase if we don't save it, but we pay down debt; and where we give middle-class folks a nice big tax cut, but we don't give a blank check to everybody at the top of the tax cut, so we spend money we would use for Social Security.

We know Republicans support the McCain plan. We know they want to pay down debt, we know they like the fact he's a fighter; he's not going to let the party establishment in Washington, D.C. push him around.

BLITZER: Is it your sense, now, that tax cuts for the Republicans for Republican voters, are not -- is not the issue that it once was?

MURPHY: No, I think what you are seeing here is a clear contrast between a smart good tax cut supported by McCain, and a bad tax cut supported by Bush. We're for tax cuts. John McCain's never voted for a tax increase. He didn't even vote for Governor Bush's father's tax increase. He's a rock-rib conservative.

But the question is with this surplus money, do we spend it on a balanced approach where we cut taxes for working folks, and we take care of Social Security and Medicaid and pay down the debt, or do we give it all in a huge tax cut? And overwhelmingly Republicans support the more conservative balanced plan that Senator McCain has. BLITZER: All right, Mike Murphy stand by. When we come back, we'll be joined by Haley Barbour, a Bush supporter, former chairman of the Republican Party. We'll be right back.

(COMMERCIAL BREAK)

BLITZER: Welcome back to LATE EDITION. We're now joined by Haley Barbour; he's a supporter of George W. Bush, former chairman of the Republican National Committee.

Mr. Barbour, welcome back to LATE EDITION

Good to have you on our program.

HALEY BARBOUR, GEORGE W. BUSH STRATEGIST: Thank you, Wolf. I'm glad to be back.

BLITZER: We thought so many pundits, so many experts thought that George W. Bush had this Republican nomination locked up. He's raised $60 million plus. What happened in New Hampshire? And what's happening right now in South Carolina?

BARBOUR: You know it is funny, Wolf. When George Bush last year -- or when I on your show said -- George Bush is going to have to fight for this nomination. He's going to have to earn it. He's not going to get it on a silver platter. I can remember all the reporters and pundits rolled their eyes. But we've never -- since I have been involved in my adult life -- no Republican nominee for president has ever won the nomination without getting knocked down. And George Bush got knocked down hard in New Hampshire. He got his clock cleaned. And now people are looking to see if he can take a licking and keep on ticking. And I think he can. And I think he'll prove it in South Carolina and then on March the 7th in Michigan, a couple days after South Carolina. So -- but this is not new news.

But now the real question is what should Bush do about it? And of course, what Bush ought to do about it is make the campaign about issues. And to also hold Senator McCain to the same standard. Watching Mike Murphy was just a huge reminder about how the campaign -- the McCain campaign says one thing, but does something totally different. What we really need is some straight talk out of The Straight-Talk Express, Because so often now, McCain sounds just like Clinton.

BLITZER: All right we're going to get Mike Murphy back in this conversation later, but I want to press you on a couple of points that Senator McCain is now making. I want you to listen to what he said earlier today on ABC's "This Week" in which he argued that the huge tax cut proposal that Governor Bush is putting forward is not necessarily something that is a high priority for a lot of Republicans. Listen to this.

(BEGIN VIDEO CLIP, ABC'S "THIS WEEK")

MCCAIN: The Bush problem right now is that 60 percent of the American people, surprisingly to many experts, favor a balanced approach, as I have, rather than putting it all into massive tax cuts.

(END VIDEO CLIP)

BLITZER: Massive tax cuts. That sounds like he's going against one of the holy grails of Republican Party politics.

BARBOUR: Well, he does sound just like Clinton, and although Mike Murphy denied it in the earlier segment, in fact Senator McCain's $241 billion proposal for a tax cut is smaller than what Clinton proposed last year.

UNIDENTIFIED MALE: Well, I'm not concerned about that.

BARBOUR: Let's talk about.

BLITZER: I just want to make it clear that what the president proposed, he said he could accept a $300 billion tax cut over 10 years, but half of that would be the first five years, and what John McCain is proposing is about $250 billion tax cut over five years. So on that twice as big, Mike Murphy does have the numbers on his side.

BARBOUR: Well, I think if you'll go back, Clinton was talking about $350 billion over five at one point but let's ...

BLITZER: No, he was talking about $300 billion over 10 years.

BARBOUR: If in fact you are right, I will concede that to you. But here's what's not right. Senator McCain campaigned all over New Hampshire and said he had never voted for a tax cut. Then when he came to South Carolina, some group ran an ad that called his hand and told the truth it said, "Not only did he vote for tax cut but he was sponsor and principal author last year of a huge tax cut" -- I mean, tax increase, I'm sorry tax increase, and it was a tobacco tax increase.

So, what was Senator McCain's response? Was it to say, Well, you are right, I was for a tobacco tax increase. Instead he attacked the group. He attacked the group that blew the whistle on him.

Again, this is just like Clinton. I mean, I could remember Hillary Clinton saying, Oh, my husband didn't do anything wrong. This a vast right-wing conspiracy about people to get my husband.

This is so Clintonesque.

And the thing is, the press has never blown the whistle on him. If you ask why can your Bill -- your political analyst Bill Schneider say McCain comes across as the un-Clinton candidate? Well, it's because the news media doesn't blow the whistle.

Again, we need some straight talk from The Straight-Talk Express.

BLITZER: All right. Mr. Haley, we have a lot more to talk about, including phone calls, not only for you but for Mike Murphy as well.

For our international viewers, "WORLD NEWS" is next.

For our North American audience, stay tuned for another 30 minutes of LATE EDITION. We'll check the hour's top stories with Gene Randall, then more of your phone calls for Mike Murphy and Haley Barbour.

Plus our LATE EDITION roundtable and Bruce Morton's last word.

It's all ahead when LATE EDITION continues.

(COMMERCIAL BREAK)

BLITZER: Welcome back to LATE EDITION. We're talking presidential politics. We'll be taking your phone calls for Mike Murphy and Haley Barbour in just a moment, but first here's Gene Randall with the hour's top stories -- Gene.

(NEWS BREAK)

BLITZER: Thanks, Gene.

We now return to our discussion of the Republican presidential race with Bush supporter Haley Barbour and McCain strategist Mike Murphy.

All right, Mike Murphy, the last round we heard from Haley Barbour, he made some very strong charges against John McCain saying he is no better than Bill Clinton on a lot of these issues that are so dear to Republicans, like tax cuts, for example.

MURPHY: Well, Haley's just wrong. I mean, nobody's more anti- Clinton than John McCain by example and by policy issues. I mean -- and he was wrong, as you proved when you got the numbers out, about the tax cut.

There are three tax cuts on the table: a small phony Clinton one, a pretty big McCain tax cut targeted at the middle class, and a whooping, enormous, dinosaur-sized cut from Governor Bush. And the big difference is, McCain says smaller tax cut but save Social Security, pay down the debt, Medicare. Bush says, all the new money goes into tax cuts.

There is $2 trillion of surplus now in the Social Security system, but Lyndon Larouche can get elected president if that money will be there. The question is: new money, choice, balanced plan, big tax cut.

BLITZER: All right, let's take a caller from Anchorage, Alaska. Please go ahead with your question.

CALLER: Yes. I saw a clip this morning where George Bush was criticizing John McCain as an insider. But George Bush's father was vice president for eight years, and I believe a senator at some point. Don't you think that he was in essence criticizing his own father's qualifications, when he was saying that about Mr. McCain.

BLITZER: Well, his father was president of the United States, as well.

Haley Barbour, what do you say to that charge, that John McCain is an insider, George Bush is the outsider, and of course, the flip- flop, the accusations are going forward, who's more of an insider?

BARBOUR: Well, of course the truth is, Senator McCain has tried to portray himself as an outsider, and that's fine. He's certainly got the right to try to do that. And he said this is a race where the establishment -- the Republican establishment is against him.

And I guess since there are 10 times as many Republicans senators, colleagues of Senator McCain, that have endorsed Governor Bush than have endorsed Senator McCain, I can see where he might feel that way. But the truth is, the real establishment campaign here is how John McCain is the candidate of the liberal media establishment. It was in "The Washington Post" today that "The New York Times" had written 130 positive editorials about John McCain in the last three years. Now, how many do you think they wrote about George Bush?

"The Washington Post," in fact last Friday, declared on its editorial page that the real conservative in this race is John McCain.

Now, Republicans a long time ago quit listening to "The Washington Post" to tell them who was really a conservative, and the one thing we know about "The New York Times" is the only way Republicans can make "The New York Times" happy is to lose elections.

But they're slobbering all over McCain.

BLITZER: All right. Let's take another caller. I know you want to respond, Mike Murphy...

(CROSSTALK)

BLITZER: ... but let's take a caller from the nation's capital, Washington, D.C. Please go ahead with your question.

CALLER: Yes. My question is for Mr. Murphy. If John McCain does indeed win in South Carolina, will his Straight Talk Express approach to campaigning be enough to go against George Bush's immense piggy bank?

BLITZER: There's a lot of money that George W. Bush still has out there.

MURPHY. Oh, yes -- no, they -- every day they raise another million. It's amazing. I take my hat off to them. They're the champions of big-dollar fund raising.

But this campaign is about the battle of ideas versus the battle of big bucks. Governor Bush's campaign is always going to have the big money, but McCain has the big ideas. That's why we're moving up and Bush is moving down.

So we're very enthusiastic about coming to my homestate here in Michigan right after South Carolina and take it to the voters. That's been the secret of our campaign -- taking a message to the voters and letting them, not the power brokers, decide.

BLITZER: Is it all...

BARBOUR: You know, all of this -- I'm sorry, Mike, I didn't mean to interrupt you, Mike.

BLITZER: No, go ahead, Haley Barbour, you're interrupting me, but it's OK.

BARBOUR: Well, I don't mind interrupting you, Wolf.

(LAUGHTER)

Look, this is another case of where we need some straight talk out of The Straight-Talk Express. In New Hampshire, in the primary, the McCain campaign spent nearly $2.5 million. I think Mike will verify that. The legal limit to spend there is $660,000. Now Senator McCain holds himself out to be Mr. Campaign Finance Reform for tough campaign laws, but when it comes to the law applying to his campaign, he evades the law, cheats on the limits, spends four times the limit, and yet, we don't get that straight talk.

MURPHY: Oh, Haley...

(CROSSTALK)

BARBOUR: Are you going to -- look, Steve Forbes and George Bush said: If the price to get taxpayer subsidies for my campaign is to have a low limit in New Hampshire and South Carolina, we won't take the taxpayers' money. McCain said: Well, I'll take the taxpayers' money and I'll blow the caps to boot.

MURPHY: I have to address this one, because this one's a whopper.

BLITZER: Very quickly -- we only have a few seconds left, Mr. Murphy.

MURPHY: Bush is outspending us four to one. We did not overspend the cap in New Hampshire. Bush looked at the cap, laughed at it, threw it out the window. He's got the $100-million campaign; we don't.

BARBOUR: Mike, are you saying you all spent less than $660,000 in New Hampshire?

MURPHY: We were legal under the cap, Haley, every dime.

BLITZER: All right...

(CROSSTALK)

BARBOUR: We believe that's a Clintonesque expression. That sounds just like...

(CROSSTALK) MURPHY: It's the truth...

(CROSSTALK)

BARBOUR: ... "it was legal."

MURPHY: We have a word for it: straight talk.

BLITZER: Straight talk, and unfortunately that has to be the last part of this segment.

Haley Barbour, always great to have you on LATE EDITION.

BARBOUR: Thank, Wolf.

BLITZER: Mike Murphy, same with you.

MURPHY: Thank you.

BLITZER: Good luck to both of you as this campaign really gets going.

And when we return, we'll go around the table with Steve Roberts, Susan Page and Tucker Carlson -- more on the Republican race as well as Hillary Clinton's announcement for the U.S. Senate. Stay with us.

(COMMERCIAL BREAK)

BLITZER: Welcome back to LATE EDITION. Time now for our roundtable. Joining me: Susan Page, White House bureau chief for "USA Today;" Steve Roberts, contributing editor for "U.S. News & World Report;" and Tucker Carlson, political writer for "The Weekly Standard."

Now, lets go round the table quickly.

Steve, what happened in New Hampshire and what is happening right now in South Carolina with this John McCain phenomenon?.

STEVE ROBERTS, CNN COMMENTATOR: Well, I can tell you what it is not about. It's really not about issues. I stood outside the voting booth on election day in New Hampshire. I must have talked to four dozen people, and what they said about McCain was: candor, I trust him, I like his biography.

No one mentioned -- one guy mentioned soft money and he had no idea what it was. This is -- this is about his biography; it is about his personality, his sense of strength. The exit polls show that what people like about him is he says what he believes and he is a strong leader. And I think it makes a very strong contrast to George Bush, who's not coming across well on either of those two counts.

BLITZER: Tucker, for weeks on this program, you have been saying watch John McCain, he's someone who could capture this nomination.

TUCKER CARLSON, CNN COMMENTATOR: Well, I've been brainwashed on the bus. But I think Steve is absolutely right, and the McCain campaign understood this from the beginning. They'll tell you point- blank, you know, on background, this is not a campaign about issues; it is a campaign about themes. They understood that.

You know, the McCain bus, it's not really a political bus, it's a road trip. You know he just -- the Bush people are saying, well, gee, you know, this is all about the media, they are doing this kind of Spiro Agnew thing, the liberal media loves McCain because he's liberal -- or something. That's ridiculous. The press likes McCain for the same reason voters in New Hampshire like McCain, because he doesn't fear anything.

BLITZER: You know, he was on ABC earlier today on this week. I want you to hear what he said in terms of the attacks that have now been thrust against John McCain. Susan, listen to this.

(BEGIN VIDEO CLIP)

MCCAIN: If someone, anyone, if the Vegetarians and the Libertarians said that I was their candidate, I would welcome it. The fact is that this is the essence of Ronald Reagan's campaign and his presidency, what we used to call the Reagan Democrats.

(END VIDEO CLIP)

BLITZER: What do you think about this? You know, he's saying if the Reform Party, for example, or anybody else wants to support him, he is willing to accept that support.

SUSAN PAGE, CNN COMMENTATOR: Well, I think it is part of his appeal, that he appeals not just to Republicans, but to some crossover voters -- independents and Democrats. They were able to do that in New Hampshire.

They can do that in South Carolina, too. Anybody -- which is the next big contest coming up on February 19th -- in an important test to whether John McCain can sustain this incredible momentum he seems to have gotten from this really stunning victory in New Hampshire.

BLITZER: He says sometimes he feels like Luke Skywalker.

ROBERTS: He also reminds me of a kind of jujitsu artist because the core of this martial art is to use the weight of your opponent against him. And so he uses the weight of Bush's money, the weight of Bush's endorsements and said, see, they're all against me, I'm the only real person. And he -- and the Bush people walked right into that trap with Dan Quayle of all people, trotting out as an announcement of support the day after New Hampshire.

So, look, I still think Bush has a lot of strengths, but he can't match McCain's biography, and he can't match that sense of personal enthusiasm I think we all felt in New Hampshire.

The only candidate in either party who's really generating and real buzz, any real excitement, was John McCain. BLITZER: You know, Tucker, you raised the issue of the media and John McCain. In fact, the Haley Barbour we heard, that he's the darling of the liberal media. But look what two columnists ...

ROBERTS: Tucker, Exhibit 1, the liberal media -- right?

(LAUGHTER)

BLITZER: Two columnists for "The New York Times" this week, William Safire first, let me read to you an excerpt from what he wrote about John McCain: Now that Senator John McCain crushed Bush by an historic margin in the Republican primary in New Hampshire, we see the end of the inevitability of the former front-runner's nomination.

Now, Anthony Lewis, a much more liberal columnist than William Safire, writing this: In a time of ease, he talks about sacrifice and commitment. He reminds voters that there is more to life than self- fulfillment.

So the media, you know, does like John McCain.

CARLSON: Of course, the press loves McCain. And in some way, I think the coverage has probably been unfair. But the idea that, you know, somehow the press is driving the campaign is ridiculous.

I haven't read a single explanation that really gets to the heart of why McCain is succeeding. And I'm not sure I even understand it. But there is something radical about what McCain is saying. There is this undercurrent of, you know, as his aides said when he won: burn it down. I'm not quite sure what that means, but it really is a campaign against the establishment.

BLITZER: Susan, explain it to Tucker, that explanation that he is looking for: Why is this McCain phenomenon succeeding?

PAGE: I think he's an appealing character. I think voters and reporters like the fact that he does answer questions. Ask him a question; you'll get an answer. That's not true with the other candidates who have not put themselves out there like that.

I think there is one other factor, and that's Bill Clinton. I think John McCain is the candidate best able to exploit fatigue with Clinton, dismay with the kind of politics, the scandals that have surrounded Clinton, and even the kind of poll-tested politics that Clinton has followed.

ROBERTS: But he is following Bill Clinton's political script by running to the center. And when he talks about, "you have to get Reagan Democrats," "you have to appeal to the independents," he might be -- as Bill Schneider said a few minutes ago, he might be the un- Clinton in terms of his persona, but he's right in line with Bill Clinton in terms how he's running. It is very much a page out of Clinton's playbook. It's very much a page out of Clinton's playbook.

BLITZER: We have to take another quick break. When we return, just a couple of hours, first lady Hillary Rodham Clinton officially throws her hat into the Senate ring. We'll get the roundtable's take on Mrs. Clinton's unprecedented move when we get back. Stay with us.

(COMMERCIAL BREAK)

BLITZER: Welcome back to LATE EDITION.

All right, Susan, the first lady has a new video, an 18-minute commercial if you will, talking about her trying to reinvent herself for the voters of New York state, and the president is part of that video. I want you to listen to this listen except from that commercial.

(BEGIN VIDEO CLIP)

WILLIAM J. CLINTON, PRESIDENT OF THE UNITED STATES: The people who work with her feel I think a lot of respect and affection for her, and she unleashes people's energies. And when you're in the Senate, you need be able to bring people together and kind of lift them up, and she's very, very good at that.

(END VIDEO CLIP)

BLITZER: Smart politics in New York state to get the president on board right away, aggressively, as he appears to be doing in this ad.

PAGE: You know, I think it's a real deliver for Hillary Clinton's campaign, because on the one hand Bill Clinton, is very popular in New York. It's one of the states where he is most popular. On the other hand, I'm not sure it works to her advantage to have him out there too much. You know, he'll be there at her announcement in a few hours, but we don't expect him to speak. That shows the kind of line they've tried to walk.

I think also this video -- it's very odd it tries to -- you know your mom always told you that you never have a second chance to make a first impression. I think that's true if politics too, and it's hard to change people's impression of the sort of person you are once it's been as set as firmly as Hillary Clinton's impression is now set.

BLITZER: Bill Clinton is very popular with African-American voters in New York City -- a lot of the traditionally liberal Democratic constituency, which is a big part of New York.

CARLSON: Yes, and he's also her husband and he's president, and there's no denying it, so I mean at some point, he's going to have an inference in this campaign.

I think the larger problem with the campaign -- and she will get those votes anyway, I mean, no matter (inaudible) she'll get them, I think -- but the problem is, what's the rationale for the campaign exactly? Rudy has a bad personality? That's not a bad rationale. But I'm not sure that's enough to become a senator. And this idea that she -- anybody who has to reinvent himself or reintroduce himself to the voters, I mean, that's a clear sign of desperation.

ROBERTS: And the fact that Clinton says she unleashes people's energy, she sure does. She unleashes the energy of the lot of people who hate her, you know. I mean, she is a...

BLITZER: But a lot of people love her, too.

ROBERTS: Yes, it's true, but she becomes a polarizing figure. A lot of people love her; a lot of people really are going to work hard to get rid of her.

But I also think another thing, we talked about the move toward the center that we're seeing in the presidential race. You're seeing in the Senate race, too, in a very interesting way.

Here's Mrs. Clinton, goes out of her way in "The New York Times" to say: I'm for welfare reform, I'm for the death penalty, I'm not a standard liberal the way you think.

And here, Rudy Giuliani, when you were talking to him just a few minutes ago, was saying: I'm for campaign finance campaign, I'm for the right to sue. Both of them are trying to move toward the middle and accuse the other one of being an extremist.

BLITZER: And on the substantive issues, there isn't a lot of difference on some of these really sensitive issues like abortion and even taxes for that matter.

PAGE: Not a lot of difference. I think that probably works to Rudy Giuliani's advantage. He's an experienced candidate; she's an inexperienced one. He's familiar to New York voters; she's not. She has some baggage having just moved to the state, so I think the degree to which there are not sharp ideological differences probably serves his purposes.

BLITZER: And Tucker, very quickly, those conservative Republicans who hate Rudy Giuliani because of his position on gays in the military or gun control or abortion rights and partial birth abortion, these things, will they go all out to get him elected?

CARLSON: I'm not sure they'll go all out. I don't think they're going to vote for Mrs. Clinton. And this idea, you know, she won't let the "right-wing conspiracy" stuff die, so since she keeps talking about that, it hurts her.

BLITZER: Tucker Carlson, Susan Page, Steve Roberts, our LATE EDITION roundtable, thanks again for joining us.

And just ahead, we'll reveal what's on the cover of this week's major news magazines, plus Bruce Morton's last word on the former president who's marking a birthday today.

(COMMERCIAL BREAK)

BLITZER: Welcome back. Time now for Bruce Morton's last work today on Ronald Reagan's 89th birthday. Bruce looks at how Ronald Reagan remains a powerful force in Republican politics.

(BEGIN VIDEOTAPE) BRUCE MORTON, CNN CORRESPONDENT (voice-over): His presidency ended more than a decade ago, but politicians -- Democrat and Republican -- still talk about Ronald Reagan.

Al Gore has an ad noting that in Congress he opposed the Reagan budget cuts. He says that because Bill Bradley was one of 36 Democratic senators who voted for the cuts.

Gore doesn't point out that Bradley also voted against the popular Reagan tax cuts, and that it was the tax cuts that piled up those enormous deficits -- the snow-balling national debt.

And that's just Democrats.

Republicans all say good things about "the Gipper." Bush says his proposed tax cut is in the Reagan tradition. John McCain campaigns under the Reagan banner as well.

(BEGIN VIDEO CLIP)

MCCAIN: I don't think that anybody can paint me as being anything but a proud conservative, as I am in the tradition of Ronald Reagan and my favorite, Theodore Roosevelt.

(END VIDEO CLIP)

MORTON: Steve Forbes notes that Reagan picked him to lead Radio Free Europe, which, as Forbes ad says, helps play a role in the fall of communism.

Alan Keyes always notes that he worked in the Reagan administration.

Clearly, for all sorts of candidates in all sorts of ways, "the Gipper's" legend lives.

What kind of president was Reagan, whose birthday is this weekend? First, a president who won big and therefore arrived with a mandate. He'd run promising to boost defense spending and cut taxes, and the Democratic Congress, looking at the votes, said, OK, and went along.

Did he end the Cold War? He helped, certainly. But presidents of both parties followed a policy of containing the Soviet Union, and that's what finally brought the Soviet Union to its knees.

Socially conservatives love Reagan, even though while speaking eloquently to their issues -- abortion, school prayer -- he never did much about them. Maybe his real achievement was that he made America feel good again. After all the cynicism bred by the Vietnam War and the Watergate scandal, here was a happy optimist proclaiming it's morning in America -- that shining city on a hill.

(BEGIN VIDEO CLIP)

RONALD REAGAN, PRESIDENT OF THE UNITED STATES: She still stands strong and true on the granite ridge and her glow is held steady, no matter what storm. And she's still a beacon, still a magnet for all who must have freedom.

(END VIDEO CLIP)

MORTON: And if facts -- yes, the U.S. really did trade arms for hostages -- sometimes got in the way, he'd simply forget them.

Reagan really was the boy who just knew that with all that manure there had to be a pony somewhere. And he got the rest of America to smile and believe again, too.

I'm Bruce Morton.

(END VIDEOTAPE)

BLITZER: Thanks, Bruce.

And happy birthday, Mr. President.

Time now for a look at what's on the cover of this week's major news magazines here in the United States. Senator John McCain is on a roll. He's on the cover of all three. "Newsweek" announces McCain's "Big mo: Can he beat Bush?" on the cover.

"TIME" magazine uncovers the McCain mutiny inside the campaign that turned the GOP race upside down, on the cover.

And on the cover of "U.S. News and World Report": "Can he win it all? McCain bets on a new brand of politics."

And that's the LATE EDITION for Sunday, February 6th. Remember to stay with CNN this afternoon for live coverage of First Lady Hillary Rodham Clinton's Senate announcement. That's at 3:00 p.m. Eastern, noon Pacific.

And catch us again next Sunday and every Sunday at noon Eastern for the last word in Sunday talk.

And I'll, of course, see you tomorrow night at 8:00 p.m. Eastern on "THE WORLD TODAY."

For now, thanks very much for watching. Enjoy the rest of your weekend. I'm Wolf Blitzer in Washington.

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