[This Is A Rush Transcript. This Copy May Not Be In Its Final Form And May Be Updated. Leon Harris, Cnn Anchor:] We're going to begin with politics, parties and the balance of power. The buzz in Washington this morning is over Vermont Senator Jim Jeffords. He is expected to announce today that he is leaving the Republican Party. And sources say it's unclear right now whether Jeffords will join the Democratic Party or if he will become an independent. Either way, this move would shift the balance of power to the Democrats, since the Senate is right now evenly divided between the two parties 50-50. The Jeffords factor has implications from Capitol Hill to the White House. The timing could affect President Bush's legislative agenda, including that big tax package which is now before the Senate. Let's get some extensive live coverage this morning from our congressional correspondent Kate Snow and our senior White House correspondent John King. Ladies first. Let's start with Kate on Capitol Hill. Kate, what is the latest from there?
[Kate Snow, Cnn Congressional Correspondent:] Good morning, Leon. The latest from here, two Democratic sources telling me this morning they do expect that Senator Jim Jeffords will leave the Republican Party and will go independent. That is the expectation that he will become an independent rather than becoming a Democrat and sort of going all the way. But as an independent, Senator Jeffords is expected to vote in favor of the Democrats and expected, as a key thing, to back Senator Tom Daschle as the new majority leader. Now that is very crucial, Leon, because that would set up a new majority for the Democrats. It would mean the Democrats would take charge of the agenda here in the Senate. It would mean that they are able to control the votes and it would mean, importantly, too, that they would get the key committee leadership positions Leon.
[Harris:] Well that's got to have folks in the White House either stroking their chins or wringing their hands. John King, what are they doing there at the White House about all this?
[John King, Cnn Senior White House Correspondent:] Well, they're quite disappointed. They made a last-ditch effort yesterday afternoon and last night to try to convince Senator Jeffords to change his mind and stay in the Republican camp. However, this morning, sources here as well saying they don't expect that to happen. They do, indeed, expect Senator Jeffords to bolt the GOP. What will the impact be? This could have dramatic impacts on the president's first year agenda and redefine how we define bipartisanship here in Washington. Up to now, with the Republicans in charge, the president has reached out to selective Democrats on selected issue. Moderate and centrist Democrats say like he did during the tax cut debate. He has shied away from dealing directly with the Democratic leadership in the House and the Senate. Now they know here this morning that if Tom Daschle is the majority leader of the United States Senate, the president's going to have to do business in a very different way.
[Harris:] Well, John, what are you hearing about the business being done there in the White House in regards to Senator Zell Miller? We've been hearing that perhaps the White House has been reaching out to him. I even read somewhere that they might even be offering to name an aircraft carrier after him to get him to switch parties and even things back up again.
[King:] Well, the White house has been trying for some time and Republicans in Georgia and here in Washington have been trying for some time to convince Zell Miller, a conservative Democrat, a former governor of Georgia now in the Senate, to come over to the Republican side. But about two weeks ago, Senator Miller issued a statement, trying to tamp down all this speculation, saying he would stay in the Democratic Party. And I'm told by sources on Capitol Hill that key Democrats have checked in with him in the last few hours and they expect him to stay put in the Democrats. That doesn't mean there won't be an aggressive lobbying campaign from the president on down in the days and weeks ahead.
[Harris:] We know lobbying is going on on Capitol Hill. Let's go back there. Kate, what do you hear? Actually, right now we want to show you live picture, folks, that we are getting of Senator Jim Jeffords, the man in the center of the attention this morning, as he's leaving his house. Let's listen to see if he's answering questions.
[Sen. Jim Jeffords , Vermont:] Thank you.
[Unidentified Male:] Thank you.
[Harris:] He has been saying that for the last couple of days, no questions, no answers, no nothing before he makes his announcement, which we expect will come sometime today. Let's go back to Kate Snow on Capitol Hill. Kate, what does this mean for President Bush's tax package because of the right now it does seem to be in a rather tenuous situation?
[Snow:] Right, and that is a key question, Leon. Of course they thought two days ago that they were going to have a tax cut pass. The Republicans in control of the House and the Senate right now thought that the Senate would quickly pass a tax cut. Well that didn't happen. It's been stalled. And the Democrats on in the Senate have been actually stalling on purpose, throwing in as many amendments as they can think of to try to delay the process. That's where we're at with the tax cut. So what happens when Senator Jeffords makes his announcement later today? Well that depends on what he says. If he says that it's effective immediately, then certainly that could impact his vote on the tax cut. He has, of course, opposed the president's tax cut for some time now, which is what led to all this trouble in the first place. But the other possibility, Leon, is that he may say, look, I'm going to become an independent, but I'm going to wait until after the two key pieces of legislation that are landmark pieces for this administration, the tax cut and the education plan, have passed through this Congress. That's a definite possibility as well. He may sort of announce his change but make it effective after those key votes.
[Harris:] OK, we'll keep our eyes and ears peeled for whatever happens from all that. TO ORDER A VIDEO OF THIS TRANSCRIPT, PLEASE CALL 800-CNN-NEWS OR USE OUR SECURE ONLINE ORDER FORM LOCATED AT www.fdch.com