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Special Event

Legal Options for Gore Campaign Dwindling; Bush Campaign Sounds Conciliatory Note

Aired December 5, 2000 - 8:00 p.m. ET

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

WOLF BLITZER, CNN ANCHOR: Tonight, Al Gore vows to pursue his diminishing legal options and says there's no reason to worry.

(BEGIN VIDEO CLIP)

AL GORE, VICE PRESIDENT OF THE UNITED STATES: I don't feel anything other than optimistic. I really -- and the team down in Tallahassee feels that way also.

(END VIDEO CLIP)

BLITZER: For George W. Bush, the transition continues, and Vice President Gore, he says, will have to make his own decisions.

(BEGIN VIDEO CLIP)

GOV. GEORGE W. BUSH (R-TX), PRESIDENTIAL CANDIDATE: I can understand what he may be going through. It's been a very interesting period of time for both of us.

(END VIDEO CLIP)

BLITZER: Al Gore's attorneys head back to court, again. And Wall Street may deliver a presidential verdict of its own. A look beyond politics to the economic impact of this neverending election, all ahead on this special edition of THE WORLD TODAY: "The Florida Vote."

Good evening. I'm Wolf Blitzer, reporting tonight from Washington.

Al Gore's legal options are dwindling. He may in fact have only two lifelines left. One of them was extended this morning when Florida's Supreme Court agreed to hear Gore's appeal that yesterday's lower court ruling rejecting manual recounts was wrong. Briefs are due tomorrow at noon. Oral arguments begin 10:00 a.m. Eastern Thursday.

Gore's second line of defense: separate court trials scheduled for tomorrow involving improperly filled out absentee ballot applications in heavily Republican Seminole and Martin counties. About 25,000 ballots are involved. If they are thrown out, Bush would lose several thousand votes, more than enough for Gore to take over the lead.

We heard today from both George W. Bush and Al Gore about this election 2000 situation. First, our senior White House correspondent John King on Gore's path ahead.

(BEGIN VIDEOTAPE)

JOHN KING, CNN CORRESPONDENT (voice-over): The public line is upbeat.

GORE: I don't feel anything other than optimistic. I really -- and the team down in Tallahassee feels that way also.

KING: The public image one of unity.

REP. RICHARD GEPHARDT (D-MO), MINORITY LEADER: Al Gore and Joe Lieberman enjoy strong support within our caucus for what they're doing to try to get every vote counted in Florida.

KING: But many restless Democrats and even some top Gore advisers believe the odds are long, the end in sight.

GEOFF GARIN, DEMOCRATIC POLLSTER: If Gore loses in the Florida Supreme Court, I think that the ball game is pretty much over. It will be tough for him to go on at that stage.

KING: The vice president's contest of Florida's election results now rests on one last appeal, and a month of waiting could be down to a decisive few days. The Florida Supreme Court will hear Gore's appeal Thursday, with a ruling expected as early as Friday. And trials are scheduled Wednesday for Democratic suits challenging thousands of absentee ballots in Seminole and Martin counties.

The vice president is not party to those and before Tuesday had little to say about them, but he could benefit if the ballots are disqualified, and he's clearly watching with interest.

GORE: More than enough votes were potentially taken away from Democrats because they were not given the same access that Republicans were.

KING: The Gore appeal challenges all of the circuit court ruling by Judge Sanders Saul, but Gore legal advisers believe their best case, because of prior state Supreme Court rulings, is the portion dealing with Miami-Dade County. The Gore teams wants credit for 157 additional votes identified before a countywide hand recount was called off and wants a manual review of 10,000 ballots that registered no vote for president in machine tallies.

SEN. JOSEPH LIEBERMAN (D-CT), VICE PRESIDENTIAL CANDIDATE: We're also confident that this can be done expeditiously.

KING: But even Lieberman's confidence has limits. Sources tell CNN he has spoken to several friends and associates in recent days about the challenges of returning to the Senate in such a volatile political environment. And the vice president, too, is described by a close adviser as well aware he is running out of both legal and political options.

(END VIDEOTAPE)

KING: But while Senator Lieberman's message on Capitol Hill today was that all this would be over very soon, the vice president in public stopped well short of saying he would bow out if he loses at the Florida Supreme Court. For some, that was proof he's not as confident as he says he is and that he's looking for help from those suits challenging all those absentee ballots -- Wolf.

BLITZER: John, and on those Seminole County and Martin County suits, there was a new line, as you pointed out, of argument that Gore is making, while he is not an official party to those suits. He's saying that Democrats did not have the same opportunities to change some of those voter ID numbers that Republicans had.

KING: That's right, Wolf. Politically they have felt very reluctant to wade into this dispute. In fact, the vice president vetoed a request from his legal team. They wanted to join those suits so that the best of the Gore legal team could be fighting in court on that issue. The vice president said no because he believed it would run contrary to his overriding public message here that he wants every vote to count.

But it was very curious today -- it took many of his own aides by surprise -- that the vice president talked in such detail about those suits. Again, to some it was a sign that perhaps he's not so confident at the Florida Supreme Court, and to some it was a sign that if those suits were not resolved and if Gore lost at the Supreme Court, that perhaps he would wait a little bit before conceding to see how those suits play out.

BLITZER: I know also, John, you've been looking into Senator Lieberman and perhaps some lingering feelings among some of his Democratic colleagues in the Senate that he should have dropped out of the Senate race, allowed another Democrat to win from Connecticut.

Any hard feelings left over there?

KING: There are still some hard feelings. Surprising, I guess, to most of our viewers that Senator Lieberman was more well-received on the House side today than he was on the Senate side. Many of his colleagues, several of his colleagues anyway, used terms like selfish, self-centered. They believe he should have quit the race for Senate. He ran as both the vice presidential nominee and for re-election in the Senate.

Senator Lieberman would argue it looks like he made the wise choice. If the vice president is to lose, he will keep his seat in the Senate. But several Democratic colleagues saying that he will have a tough time transitioning back to the Senate, rebuilding his relationships, not only with the Democrats but with the Republicans as well if in the end -- it is still an if -- but if in the end Governor Bush wins.

BLITZER: John King, thank you very much. The Gore camp's public display of optimism come at a time when the Bush team is celebrating its legal successes but toning down its political rhetoric.

CNN senior political correspondent Candy Crowley has more on that.

(BEGIN VIDEOTAPE)

CANDY CROWLEY, CNN CORRESPONDENT (voice-over): Optimism is tempered by the inherent unpredictability of what the Florida Supreme Court may do.

BUSH: It's been one month from today that the people actually showed up and started to vote, and here we stand -- and here I stand -- still, you know, without a clear verdict.

CROWLEY: Still, the governor of Texas may be a court ruling away from president-elect. And the rhetoric about a concession from Al Gore has been dialed back.

BUSH: That's a decision the vice president has to make. It's a difficult decision, of course, and you know, I can understand -- I can understand what he may be going through. It's been a very interesting period of time for both of us.

CROWLEY: Key word: conciliatory. Bush and company want to give the vice president room to play this out his way. "Our guiding philosophy," says a Bush staffer, "is simple caution. There is a concern with acting presidential while not acting in a way that is condescending to the vice president."

Caution extends to movement toward naming a Cabinet.

"We're in total lockdown until Gore concedes," according to one aide.

Still, senior staff announcements may be forthcoming, and some potential Cabinet nominees have been contacted, activity designed to ensure that Bush can move out of uncertainty with decisive movement.

BUSH: I think it is going to be important to show some -- once the election is over -- to show the American people that this administration will be ready to seize the moment.

CROWLEY: Laying the groundwork for getting legislation through a divided Congress, Dick Cheney worked Capitol Hill Tuesday, meeting only with Republicans, reaching out to everybody.

RICHARD CHENEY (R), VICE PRESIDENTIAL CANDIDATE: And the transition is up and running and operational now, and we look forward to working with members of Congress of both parties.

CROWLEY: The Bush team philosophy as described by one aide: "Hug a Democrat. You need them." But the timing is not yet right. "We're looking forward to reaching out to Democrats," said one strategist, "but part of being bipartisan is being respectful of the opinions of the other party and not putting them in an awkward position."

(END VIDEOTAPE)

CROWLEY: This step back and let it happen approach is a short- term strategy. If the Florida Supreme Court should turn things upside down. All options, both legal and political, are back on the table -- Wolf.

BLITZER: Candy, what are the Bush people saying about Al Gore's new argument that Democrats didn't have the same opportunities in Seminole and Martin counties that Republicans had in filling out those absentee ballots applications?

CROWLEY: A couple of things. First of all, in a political -- from the political arm, they find it interesting that this case that the Gore people keep saying they're not interested in seems to have obviously captured the attention of the vice president. They believe that there's more of a hand from the Gore team than it would appear in public. They also note that the man who has filed this case was a heavy contributor to the Republican Party, that he put an anti-Dick Cheney commercial during the campaign. But they also believe from a legal basis that there is existing case law which shows that if a voter casts a vote that contains no voter fraud, that that should take precedence over anything else. So they believe that case law is on their side as well.

BLITZER: And Candy obviously meant that Harry Jacobs, the man who filed that lawsuit, was a heavy contributor to the Democratic Party, not to the Republican Party.

Candy Crowley, thanks again for joining us from Austin.

And one more note from Capitol Hill: Hillary Rodham Clinton joined 10 other Senate freshmen today for orientation. The three-day session is designed to introduce new members to the ways and rules of the U.S. Senate. Mrs. Clinton said she looks forward to building new relationships with her new colleagues.

And South Carolina Senator Strom Thurmond turned 98 years old today. He's the Senate's longest-serving member, and as president pro tem, he's third in line to be president. Thurmond recently told an interviewer -- quote -- "I feel like I'm 68."

And up next, a closer look at the other Gore lifeline: Seminole County's absentee ballots and the case that goes to trial tomorrow. Also ahead, the impact of the election and the uncertainty on the country's economic future. You're watching a special edition of THE WORLD TODAY.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP) SEN. BARBARA MIKULSKI (D), MARYLAND: This election is not a knock out. It's going to be really a TKO. We're now into the 15th round. Vice President Gore has three more punches that he can throw through his appeals.

(END VIDEO CLIP)

BLITZER: Welcome back. One of Al Gore's last opportunities to overtake George W. Bush's lead in Florida hinges on two trials beginning tomorrow in Tallahassee. State judges will hear private lawsuits seeking to invalidate thousands of absentee ballots in Seminole and Martin Counties. Within the past hour, the judge in the Seminole County case denied a Bush campaign motion to dismiss the suit.

CNN's Mark Potter explains what's at stake.

(BEGIN VIDEOTAPE)

MARK POTTER, CNN CORRESPONDENT (voice-over): The lawsuit was filed by Harry Jacobs, an attorney and volunteer vote-count observer for the Democratic Party. It claims thousands of Republican absentee ballots should be thrown out, which could cost George W. Bush the election.

HARRY JACOBS, PLAINTIFF: There are going to be a lot of people upset with the action I'm taking. I'm taking it because it's the right thing to do.

POTTER: The suit claims the Seminole County supervisor of elections and members of the Republican Party violated Florida election laws. Supervisor Sandra Goard is under fire for allowing Republicans to use her office to correct errors on thousands of absentee ballot applications, not the ballots themselves, which can be verify by comparing signatures on file.

The preprinted applications didn't include the voters' registration numbers, as required by law, and Republicans were allowed to correct the mistake so ballots could be sent out. Jacobs argues that was illegal, and the ballots should be disqualified.

JACOBS: To allow those voters' ballots to be counted when they were illegally issued then dilutes everyone else's vote who voted legally in this particular election.

POTTER: Jacobs says if those specific ballots can't be found, then all 15,000 absentee votes must be disqualified. Republicans say this is Democratic Party politics at its most desperate.

JIM HATTAWAY, ATTORNEY: This is an attempt to target Seminole County, which is Republican-rich country, where they know mathematically if they can throw out 15,000 votes, they can gain a 5,000-vote advantage for Al Gore in the statewide count.

POTTER: At the first of several hearings, attorneys said Supervisor Goard and party officials did absolutely nothing wrong. UNIDENTIFIED MALE: It's not an illegal act, it's not a felonious act, and the plaintiffs are just wrong -- pure and simple.

(BEGIN VIDEO CLIP)

CROWD: Count my vote! Count my vote!

(END VIDEO CLIP)

POTTER: At the Leon County Courthouse, absentee voters from Seminole County protested the intent to invalidate their ballots. The lawsuit is supported by the Florida Democratic Party, but lawyers for the Gore campaign have not joined in.

(on camera): The plaintiff, Harry Jacobs, says the law is the law, and ballots must be thrown out. The Republicans say this is a "hyper-technicality" for which thousands of voters should not be punished

Mark Potter, CNN, Tallahassee, Florida.

(END VIDEOTAPE)

BLITZER: CNN plans live coverage of both the Seminole and Martin County cases beginning at 7 a.m. Eastern 4 a.m. Pacific. And more analysis of this case at the bottom of the hour when Greta Van Susteren hosts a CNN special report.

Up next, the stock market may have soared today, but at least one of the candidates sounds a warning about tomorrow. Are we headed for a recession and how does the election's outcome affect the economy? We'll talk to a pair of experts when we come back.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Am I tired of it? Yes. But it'd rather see the right result come out.

(END VIDEO CLIP)

BLITZER: Signs that the presidential election may be drawing to an end and hopes of future interest rate cuts sent stocks soaring on Wall Street today. At the closing bell the Dow Industrials jumped 338 points and the Nasdaq gained 274 points or 10 percent -- its largest one-day point and percentage gain ever. It all followed hints from Federal Reserve Chairman Alan Greenspan that an interest rate cut may be due early next year to offset a slowdown in the nation's economy.

CNN's Brooks Jackson now on whether the slowdown is a signal of an approaching recession.

(BEGIN VIDEOTAPE)

BROOKS JACKSON, CNN CORRESPONDENT (voice-over): It's been the longest boom in U.S. history. Is it ending? Dick Cheney says, maybe.

DICK CHENEY (R), VICE PRESIDENTIAL CANDIDATE: We may well be on the front edge of a recession here.

JACKSON: And he's not alone. Some private economists also say there's a real risk of recession next year.

DIANE VAZZA, STANDARD & POOR'S: I think our view here at S&P is there is a 30-percent chance some time in 2001 where we may go into a recession.

JACKSON: Standard & Poor's says a record number of business corporations are defaulting on their bond payments. The pattern looks just like what happened before the last recession in 1992.

And signs of slowing growth just keep coming. Monday it was reported that vehicle sales slipped again in November, down 12 percent from their peak in February. Rising energy prices are like a tax on the whole economy, up 13 percent last year, and rising at a 17-percent rate this year.

The stock market keeps sliding, making stock owners feel less wealthy, more hesitant to spend. The Nasdaq, despite Tuesday's rally, still closed 44 percent below its high for the year. Other indexes are sagging as well.

Consumer confidence is falling, the lowest all year. Fewer consumers plan to buy homes, cars, appliances in the next six months and that could mean trouble.

CRAIG THOMAS, ECONOMY.COM: If the economy continues to decelerate to the point that it spooks households into spending much less this holiday season on retail goods, we could have a real problem.

JACKSON: Thomas doesn't expect a recession, nor do most economists. But slower growth is certain. Growth already has slowed down from nearly 6 percent in April, May and June, to only 2.4 percent in July, August and September, the slowest in four years.

(on camera): The worry is what one economist called "the perfect storm scenario," another jump in oil prices, more declines in stock prices, and worsening economic troubles overseas, all at once. And that's no longer so hard to imagine.

Brooks Jackson, CNN, Washington.

(END VIDEOTAPE)

BLITZER: For a better understanding of how the economy plays in times of uncertainty, and what difficulties the next president will face, we're joined from Washington by Robert Hormats, the vice chairman of investment firm Goldman Sachs. He was an assistant secretary of state in the Reagan administration. And from New York, Robert Finnerty, a market strategist with C.E. Unterberg, Towbin.

Thanks to both of you for joining us.

I want to begin with you, Bob. The statement that Cheney made, that we may be on the verge of a recession, is that right?

ROBERT HORMATS, GOLDMAN SACHS: Well, there is no evidence we're in a recession yet. The economy clearly is slowing, Alan Greenspan pointed that out today. But we're not in a recession. Most economists are projecting 2 percent growth, give or take. There are risks in the economy, of course: a weakened stock market, consumers have less confidence than before, energy prices are up, and we're also seeing a decline in manufacturing, but it's well possible the economy could just slow down without going into recession, and that's really what's happening at this current moment.

BLITZER: Brian Finnerty, isn't it possible though that, that kind of talk by someone who may be the next vice president of the United States could turn out to be a self-fulfilling prophecy?

BRIAN FINNERTY, C.E. UNTERBERG, TOWBIN: No, I don't think so, Wolf. I think what Dick Cheney was trying to do today was really get Greenspan to reiterate what he said today. Alan Greenspan made some very significant comments today and the most market-friendly comments he's made in quite some time, and basically what he did is he changed his stance from being hawkish on inflation to being -- to really worrying about the economy, and I think that's what the market wanted to see.

Because don't forget, Greenspan and his band of 12 Fed governors engineered this -- quote, unquote -- "soft landing." That's what we're all hoping that it still is, and I think Bob agrees with that, we're all hoping it's still a soft landing -- he engineered it with those six rate hikes, now he's talking about reversing, and that would be very good for the markets.

BLITZER: Bob Hormats, what about the election uncertainty, is that seriously having an impact on these markets, or is that overblown?

HORMATS: Well, it's certainly having an impact. Uncertainty has an impact on confidence of investors, but the dominant factor really has been the slowing economy, the expectations, and indeed the evidence of weaker earnings for a lot of companies. And I think it's the economic factors and the weakened earnings, plus higher energy prices, which constitute a tax on consumers, all of those are much more important factors than the election for markets and indeed for consumer confidence.

BLITZER: But, Brian, there is no doubt though that when some of the people on Wall Street, they look at a Republican administration, they say that has to be good for certain sectors like drugs, the pharmaceutical industry, or the oil industry, certain health industry- related stocks.

So all of that comes into play, doesn't it?

FINNERTY: It does come into play, Wolf, and I think the drug stocks actually were in rally mode right up through November 7, then when this thing turned a different way and the uncertainty came in, that really -- it wasn't the cause of the market going down, but it certainly didn't help the markets to bottom out and reverse, and until we got more -- the market really feels that Bush has won right now.

And we got that little rally in the futures last night, it started the rally this morning and then when Greenspan came in and said what he said -- you know, I called today a Greenspan-Bush rally. I really think that's what it was, but I do think it can be sustained, because I think psychology is changing. We do need to get a definition on this presidential thing, it's got to get resolved and it's got to be resolved, the sooner the better.

BLITZER: And what if one of those lifelines, Bob Hormats, for Al Gore does pan out and he manages to be elected president, how does that impact on the economy and the markets?

HORMATS: Well, clearly, there is a difference, and certain sectors will be better under Bush than under Gore. But I think clarification of the results will be helpful either way, really. I think though that the basic point is the point that I think we're both making, and that is the economic factors are really the key in terms of the -- most investors' minds as to what the outlook is, and if Greenspan is now moving from being preoccupied with inflation to being preoccupied with a weakened economy, and indicates he's likely to raise -- to lower interest rates some time in the future, that will be an extremely important factor going forward for the markets, for confidence and for the overall economic outlook.

BLITZER: Do you agree with that, Brian Finnerty? We only have a few seconds left.

FINNERTY: Yes, no, I do. And I think -- don't forget this one thing: the most important guy in the whole thing is Fed Chairman Greenspan. He's more important than whether it's Bush or Gore. He's the key and he's going to do something about interest rates here.

BLITZER: All right, Brian Finnerty and Bob Hormats, thanks for joining us on this special edition of "THE WORLD TODAY."

We'll be right back.

(COMMERCIAL BREAK)

BLITZER: At the top of the hour, the Republican and Democratic Party chairmen are among the guests on "LARRY KING LIVE." And at 10:00 p.m. Eastern, Jeff Greenfield hosts a special report on today's developments. After that, "THE SPIN ROOM" opens at 11:00 Eastern.

For now, thanks very much for watching. I'm Wolf Blitzer reporting from Washington. Greta Van Susteren picks up our coverage with a special report beginning right now.

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