Graham, Nickles Discuss U.S. Economy
BUSH: I'm not a stock broker or a stock picker, but I do believe that the fundamentals for economic growth are real.</s>BLITZER: President Bush speaking to reporters in Chicago on Monday. Welcome back to LATE EDITION. Joining me now to discuss the corporate responsibility bill, the state of the markets, and more, are two key United States senators. In Miami, the Democratic Senator Bob Graham of Florida, he's the chairman of the Select Intelligence Committee. And here in Washington, Republican Senator Don Nickles of Oklahoma, he's the minority whip, the number-two Republican in the U.S. Senate. Senators, welcome back to LATE EDITION. And I want to get to the economic issues in just a moment, but let me ask both of you briefly, Senator Nickles first to you, when you heard the good news that those nine coal miners were rescued, they're alive and well -- God knows the United States needed some good news after all the bad news that's been coming forward in recent weeks and months.</s>SEN. DON NICKLES (R), OKLAHOMA: Well, it was great. I tried to stay awake last night. I heard the governor, Governor Schweiker said they're going to have some new announcements, you know, around midnight. I fell asleep before that happened. So first thing, turned on the news and heard of their release. I thought this is a real miracle, it's a real answer to prayer. My compliments to the crews both that were underground for their courage and above ground for their great skill in getting them out.</s>BLITZER: They were always optimistic in their public statements, Senator Graham, but privately, a lot of nervousness was going on in Pennsylvania. How did you react when you heard the good news?</s>SEN. BOB GRAHAM (D), FLORIDA: This was a true miracle, that those men could have survived so many hours in those conditions and that the expertise of the men at the top who could have first located and then provided emergency assistance and finally rescue. My father was a mining engineer, used to work underground in the mines of Butte, Montana. And he told me about some of the experiences through which he lived. And it is just miraculous that these men have survived and they all deserve great congratulations from the American people for giving us this latest example of courage and heroism.</s>BLITZER: On that note, that note of bipartisanship and unity, let's move on and talk about some other issues that might not necessarily have such common agreement. Let's begin, first of all, on the economy. Senator Graham, do you have confidence in President Bush's economic team -- the treasury secretary, the White House economic advisor, the chairman of the Council of Economic Advisors -- that they are giving the president the best possible advice?</s>GRAHAM: I think they are giving him the advice that they believe is the best. Whether they have in fact touched the sensitivity of the American people and understand why there is so much concern both in the financial markets and the future of our economy, I'm not so sure. The action that Harvey Pitt took this week when he asked for Cabinet status and a substantial increases in his own compensation was not a good statement about his basic judgment and his basic awareness of just how that message would be received by the American people, a message that this is a man who is just fundamentally out of touch.</s>BLITZER: Well, let me let Senator Nickles weigh in. I assume you disagree with Senator Graham on this specific issue?</s>NICKLES: Well, I do. And I remember Chairman Greenspan, somebody asked him about a week ago, said, you know, what can Congress and/or the administration do to really help the economy? He said two things, you can promote trade and show some fiscal discipline. I'm not faulting the administration near as much as Congress. We have not passed a budget. We're not showing fiscal discipline. It looks like at last we're going to pass trade promotion authority. And my compliments to the House. They finished about 4 o'clock in the morning. Did pass it. I would guess that we will pass that next week in the Senate. But we have not shown fiscal discipline in Congress, House or Senate, frankly, but mostly the Senate.</s>BLITZER: Are you saying -- when you say "we," do you mean Democrats and Republicans?</s>NICKLES: Well, I criticize -- I'm critical of the Democrats. They're in charge of the Senate. They haven't even called the Senate budget resolution to the floor. And so, for the first time since 1974, we haven't passed a budget resolution, and that has lots of negative repercussions on a lot of issues -- prescription drugs and so on, appropriation bills. It's going to make it very difficult for us to get our work done.</s>BLITZER: What about that, Senator Graham? An issue close to your heart, prescription drug benefits for the elderly out there, is it being held hostage to the fact that there isn't the kind of discipline that Senator Nickles and a lot of Republicans want the Democrats to have?</s>GRAHAM: I'd like to go back to the time that Mr. Lindsey talked about, December of 1999, when it wasn't President Bush, it was candidate Bush. He made a statement that he thought there were three keys to how we should be focused on our future economy and using what then appeared to be a substantial surplus. One is to meet key domestic priorities, and he specifically mentioned providing a prescription drug benefit for senior Americans as one of those priorities. Two, reducing the deficit. And then he said, and if there are any funds left over we should consider a tax cut for the American people.</s>GRAHAM: What's happened is we've just reversed those three, and we've spent most of the surplus on funding a $1.6-plus trillion tax cut. We've made no progress, in fact, gone backwards, in terms of the deficit. And we're now saying that we cannot provide the senior Americans with what they have been seeking for the last 30 years, and that is an affordable, comprehensive, universal prescription drug benefit. I think we need to get back to the principles that the president laid out while he was a candidate, and they would give us an appropriate direction for what Congress should be doing at this time.</s>BLITZER: Are you saying, Senator Graham, that the tax cut should be reversed, should be eliminated?</s>GRAHAM: I think that we ought to put a halt on the future increments of the tax cut. Let's face it, many of these don't even go into effect for four, five or 10 years. They're not going to have any beneficial effect today on the economy. Yet the big deficits that they portend for the future are a drag on the current economy.</s>BLITZER: Senator Nickles, $165 billion deficit projected this year. The Democrats, at least, say a big chunk of that is the result of the tax cuts the president successfully pushed through.</s>NICKLES: Well, that's not accurate. The big result of the deficit that we're in right now is the fact that revenues aren't coming in as near as great as anticipated, plus we've been on a spending spree. And I go back to my original statement. We haven't passed a budget. You know, you can always throw rocks at the administration, and fine, but let's look at Congress. Congress has not passed a budget. And because we haven't passed a budget, we're spending money irresponsibly. And to me, that's not acceptable. We can control -- we in Congress can control our budget. That's one of our constitutional responsibilities is to -- how much money we're going to spend, how much money we're going to tax. I disagree with Senator Graham. I'm not in favor of a bunch of tax increases. I don't think that's the recipe for getting the economy to move. If you look at big deficits, the reason why -- the comparison between this year and last year is primarily because the revenues, the capital gains have not been coming in. The stock market is down and so on. So we need to help the economy. And how can we do that? There's a lot of things we can do, but fiscal discipline would be one. And we haven't been showing it. The Democrats have failed to call up a budget resolution, And because of that, we don't have fiscal discipline. And we've spent a lot of money, frankly, that I question.</s>BLITZER: Senator Graham, Senator Nickles...</s>GRAHAM: If we could just talk about some tangibles. The president had a chance to exercise fiscal discipline by vetoing the tax cut. He signed it. The president had an opportunity to exercise fiscal discipline by vetoing a farm bill that many people, including myself, felt was excessive. He signed it. The president has urged an energy bill, which will add substantially to the deficit. I voted against it. He has indicated he'd sign it. I think there is a shared responsibility for fiscal discipline, and if we're going to achieve it, it's going to take both the White House and the Congress working together.</s>NICKLES: It will take both, but Congress passed the farm bill. I didn't vote for it, and, yes, the president signed it. I wish he hadn't. I urged him not to. The energy bill hasn't been reported out of conference. I'm a conferee. We're working on it. Hopefully, we'll get it out. And I believe it will create jobs. It will help the economy. So hopefully, Congress can get that done. Hopefully, Congress will do its work and pass trade promotion authority this week. That will help create jobs. That will keep us competitive. That will expand...</s>BLITZER: Will it pass? Because, as you say, it did pass the House narrowly, but it did pass. The former President Bill Clinton tried to get it through; he didn't succeed. Is it going to pass the Senate, Senator Nickles?</s>NICKLES: I think so. The Senate traditionally has been more free-trade than the House and traditionally has passed it. We passed it when it went the first time almost 2 to 1. And my guess is we'll be able to pass it with a similar vote this week.</s>BLITZER: Senator Graham, is he right?</s>GRAHAM: Yes, I would agree with Senator Nickles. I was the original Democratic sponsor of what is now called the trade promotion act. The problem is that while it's important, it's not going to have an effect for the next three or four years because it's going to take at least that long to negotiate these complicated trade agreements. So while expanding opportunities through trade is a good thing for the American economy, it's not going to be a fix for our current problems.</s>BLITZER: The current problems you're blaming precisely on whom, Senator Graham?</s>GRAHAM: Well, I think there are a lot of culprits to be identified. But I believe the American people look to the president to be our leader, particularly on the economic well-being of our people. And we need some fresh ideas from a fresh team that has public confidence if we're going to begin to move forward. And I believe focusing on things like how do we get this discipline in our tax and spending processes, how do we get some people involved who show that they deserve to have the confidence of the American people based on the judgment that they are demonstrating, will be important parts, in addition to the just-passed corporate governance law that is going to give us some additional preventive measures, such as avoiding conflicts of interest between accountants and the corporations they serve, as well as strengthened sanctions against those who break the law.</s>BLITZER: All right, Senators, we're going to take a break. But we have a lot more to talk about, including your phone calls. I'll also ask both senators whether there will be prescription drug benefits for seniors. We'll be right back.