SYNOPSIS:

MR. RUSSERT: Coming next, our roundtable on the escalating battle over Social Security and the changing politics of the Middle East. Then our MEET THE PRESS Minute: almost 31 years ago right here on MEET THE PRESS, Alan Greenspan. All coming up right here on MEET THE PRESS.

(Announcements)

MR. RUSSERT: Our political roundtable and MEET THE PRESS Minute with Alan Greenspan next, after this brief station break.

(Announcements)

MR. RUSSERT: Welcome all. Kate O'Beirne, you just heard Democratic Senator Dick Durbin saying Democrats will not sit down with the president, will not negotiate. All he has to do is take private personal accounts and set them aside and then everything else is on the table. Will the president, in order to guarantee solvency in the Social Security system, take private personal accounts off the table?

MS. KATE O'BEIRNE: Tim, I suspect he won't, but I also think the White House is encouraged by the kind of things Senator Durbin was saying this morning. They actually like where they are right about now. They would have told you--they did tell us a month or so ago, the indispensable predicate for doing anything on Social Security is convincing the public there really is a problem. Only when the public feels that way will Congress feel under enough pressure to get to the table and make some pretty hard choices. They're encouraged by polls this week, showing large majorities, some 65 to 72 percent saying, you know, Social Security really does have a serious fiscal problem. They see some movement on the part of Democrats who are now saying, "Well, maybe there are some things we ought to be doing." And they're also encouraged by polls showing a narrowing in the gap on the question of which party you trust on Social Security. Democrats have long had a very big advantage there, but it's getting narrower so the Republicans are feeling a little more confident. And you heard Senator McConnell say even the democracy corps, James Carville's advising the Democrats, "The Republicans are beating you on seriousness. You can't just keep saying no." So the Republicans, the White House certainly, feels as though that's an environment that benefits them.

MR. RUSSERT: Paul Krugman, can the president say to the American people, "We have this Social Security solvency problem and private personal accounts, fix it"?

MR. PAUL KRUGMAN: Only if the Republican message machine does an even better job of obfuscation than it has so far. I mean, what's a--I think the White House has missed its window. They raced--you know, the idea was to roll over before anybody could ask questions about how this works. The--you know, with this--you yourself were saying that this kind of logic, well, there's a problem so let's have private accounts. But if anybody takes a look at how privatization actually works, their argument falls apart. And there--it has been slowed up enough that people are taking a look, and it does amount to a phase-out of Social Security as we know it and that's sinking in. I don't think they have way to make it work.

MR. RUSSERT: What about the Democratic strategy of refusing to sit down and talk until the president takes it off the table?

MR. KRUGMAN: Well, I think, that's--I think--I don't know about the political judgment, but it's right, from my point of view, because privatization has nothing to do with saving Social Security. It's only about undermining Social Security as an insurance system. It's only about trying to undermine the legacy of FDR, so that should not be part of the discussion, and I think the Democrats are right to say, "Until you say that's not what we're talking about, no deal."

MR. RUSSERT: Mike Allen, you covered George W. Bush at the White House. You now cover Capitol Hill. What are your people, sources on the Hill telling you, Republicans and Democrats, about the president's plan?

MR. MIKE ALLEN: Well, Tim, the truly indispensable predicate to getting Social Security is convincing Republican lawmakers that they can do this without losing the Congress, and they're not there. Republicans on the Hill do not have the passion for this that the president does. Now, they're having meetings down at the White House getting groups of--What?--20 Republicans who have concerns, as they call them, or are in tough districts, it's sort of time-out for off-message Republicans. The president is meeting with them. The whip, Roy Blunt of Missouri, told me the president literally sits on the edge of his chair at these meetings, tells them it was part of his victory in 2000, part of his victory in 2004, uses some of the lines he does on the stump on Friday. He said, you know, "This is going to be conservative accounts. You can't shoot dice with it. You can't put it in the lottery." But then they go home where they're used to being lauded, and getting all this great treatment, and instead they have demonstrators in their town halls, they have long-time supporters who are asking them why they're doing this. And so the congressional leadership is saying, "The bus is leaving, get on the bus." But as one Republican explained to me, there's no sense of inevitability. Nobody's willing to stick their neck out. They're not sure that it's going to come to a vote.

MR. RUSSERT: Would the president ever take private personal accounts off the table in order to negotiate with Democrats?

MR. ALLEN: Well, the president on Friday described private and personal accounts as an add-on to Social Security, something extra. And that set off a lot of bells because Democrats said either he's being deceptive or he's completely changed his negotiating position. I checked on this. The White House says he has not changed anything. They said it's just how it came out and you won't hear that again. The private accounts, personal accounts, individual accounts is essential to their idea of having more stock owners in the country, which they believe will mean more Republican voters, and putting it in a different way than Paul put it, they see it as a stake through the heart of the New Deal. It's not--you know, this White House talks a lot about changing the goalposts. If you suddenly get add-on accounts, that's the Clinton agenda. And there haven't been a lot of Bush things that were about finishing the Clinton agenda.

MR. RUSSERT: Where are we, Joe?

MR. JOE KLEIN: Well, it's kind of amazing and somewhat amusing to see the Republicans so much on the defensive on this issue right now. It's an unusual circumstance. I agree with Paul in that private accounts have nothing to do with solvency and solvency is the issue. I disagree with Paul because I think private accounts a terrific policy and that in the information age, you're going to need different kinds of structures in the entitlement area than you had in the industrial age. But it is very hard to do that kind of change under these political circumstances where you have the parties at such loggerheads. The Democrats have for the last 10 or 15 years blatantly, shamelessly demagogued this issue. They've offered nothing positive on Social Security or on Medicare or on Medicaid, and it's time for them to compromise here. It's also time for the Republicans to compromise here. One area where you might see, you know, some--one possibility is the old Washington standby, the demonstration project. We might try privatization for some younger, you know, Social Security recipients--not recipients but, you know, contributors, or we might try it in a city or a couple of places. We haven't--we don't know how it's going to work.

MR. RUSSERT: I'll let those on Capitol Hill work it out. We gave our best efforts here. Let me turn to what's going around the world. E.J. Dionne in The Washington Post wrote this on Friday. "When the news from abroad is good, what is the political opposition to do? Should Democrats let President Bush crow about favorable developments in the Israeli-Palestinian conflict, Lebanon and Iraq? Should they crow with him? ... The turn in the Iraq debate is significant but fragile. Democratic criticism of Bush has abated because says, Kurt Campbell, a defense official in the Clinton administration, `Democrats must be rooting for victory in Iraq.'" Paul Krugman, has the Iraqi election changed the terms of the debate regarding the president and the Democrats?

MR. KRUGMAN: Sure. It's a little bit harder to--I mean, someone like myself would say very strongly this was a war sold on false pretenses. It's actually greatly damaged America's position in the world if you look at it broadly, but there has been some good news lately and we're all glad about that and we hope for the best. You know, you can't be rooting for American failure. You know, we're all Americans. We all want to see things go well and you can't be rooting against democracy. You want to see it succeed. Now, you know, the news may change. It's five weeks, still no government in Iraq. You know, it's starting to look a little bit like another one of those Kodak moments, you know, toppling of the statue and then the weeks go by and suddenly it turns out that it looked better than it seemed. But maybe it'll turn out well, but, you know, you have to just hope that this is a good thing.

MR. RUSSERT: Mike Allen.

MR. ALLEN: Well, Tim, what you're seeing is the beginning of trying to attach the president's positive developments in Iraq and separate him from negative. And I think this isn't imminent, but I think over the next year, we'll probably see the departure of Secretary Rumsfeld. I think people in the White House are a little tired of him and I think the idea will be to try to sort of attach Iraq baggage to him. Our sister publication Newsweek on their cover this morning says: "Where Bush Was Right." And inside it says, "Bush really may change the world." This is a change that nobody could have imagined in this short a time. So the president can be out taking credit for the purple revolution even though people are seeing--you know, passing 1,500 debts, passing $300 million spent on this.

MS. O'BEIRNE: Tim, given the remarkable things that appear to be happening in that part of the world, I think the Democrats have to be extremely careful not to sound so resentful and pessimistic. They, of course, run the risk of being on the wrong side of history because something clearly seems to be happening there. Any party that appears to be welcoming a defeat for America because that's good for them politically is in a terrible position, and their traditional commitment to Democratic forces, fighting against repressive regimes, has been not much in evidence when they seem so unhappy or begrudging about these remarkable developments.

MR. RUSSERT: Were you surprised to see The New York Times editorial page say that this would not have happen but for the invasion of Iraq?

MS. O'BEIRNE: I think what they're doing is recognizing the facts on the ground. That's absolutely the case. None of this would be happening. We've had elections in Afghanistan. The Palestinians have had an election now. Something seems to be happening promising there, Iraq, of course, Lebanon, Egypt, Saudi Arabia. Of course, the predicate was doing what George Bush and this administration did in Iraq, the example of the brave Iraqis.

MR. KRUGMAN: Can I just say, Tim, look back at how Tom DeLay spoke during the intervention in Kosovo where he called--you know, he was defeatist. He criticized. He basically said, "You know, we're losing," and then was there one word of praise when the end result was democratic elections in Serbia? You know, just look at the difference between the parties here.

MS. O'BEIRNE: Paul, that's not bad advice again.

MR. KLEIN: That's hardly a role...

MR. KRUGMAN: But that's the point. The point is you're holding the Democrats...

MR. KLEIN: That's hardly a role model for Democrats.

MR. KRUGMAN: ...to a far higher standard than you would ever hold the Republicans.

MR. RUSSERT: Joe Klein, on this program Hillary Clinton was with John McCain and Hillary Clinton said, "No timetable. We can't do that. That would give a green light to the terrorists." Many Democrats now saying, "Even though you may have been for or against the war, now is not the time to be critical."

MR. KLEIN: Right. I was opposed to the war, but I think that once we went in there, there was no alternative but to go for a success. And, you know, it's still a very difficult situation. What you've had in the last week in Iraq is continuing, escalating and more targeted attacks by Sunnis against Shiites. And I think that--I just got back from the region. When you go in country after country after country, there is a rising tide of tension between Sunnis and Shiites. It's true in Lebanon. It's true in Syria. It's true in Iraq.

MR. RUSSERT: Kate O'Beirne, what's wrong with saying that as a Democrat? If you're concerned that the potential new prime minister may have terrorist ties or 1,500 Americans are dead or Iraq may turn into a civil war, Shiites vs. Sunnis? Isn't that the responsibility of an opposition party?

MS. O'BEIRNE: Tim, it seems sometimes, too frequently, that it's all they're saying. It's all they're saying. They breeze right past the enormous elections in Iraq: "Yeah, yeah, I suppose so, but huge problems are ahead, and we're not there yet." Well, of course that's the case. They're looking for the--they're looking for nothing but dark clouds. And so it seems, as I said, resentful, like they're not welcoming these incredible developments that of course make the world safer, of course benefit America's national security. So I think the criticisms or the cautions have to be downplayed. They ought to be saying more in support of these democratic movements, explicitly more in support of them. I haven't heard that.

MR. RUSSERT: What are the Democrats on the Hill doing?

MR. ALLEN: Yeah. I think one place you may see the Democratic argument go is the opportunity cost of Iraq as you see problems in North Korea and Iran. $300 billion has been spent before on this, but the embassy by itself is going to be $600 million, the biggest in the world. The House Republicans decided this week to let them do it after Secretary of State Rice came up and made a personal plea for it. But Democrats say that they're going to use these requests for funds to--the president talks a lot about results. They're going to ask--use that as a chance to spell out exactly what's been done.

MR. KLEIN: I think that what Mike said before about the waning of Rumsfeld is really important. The time for aggressive military action is past. This is the moment for some really creative diplomacy, and diplomacy backed by money. What we need to do, like, in Palestine is help to build a Palestinian middle class. We have to support secular education in the region. There are all these things that we can do to help support democracy movements and moderates in the region that don't involve military action, and that's the pivot that the Bush administration has to make right now.

MR. RUSSERT: People in the streets of Lebanon demanding that Syrian troops get out. Joe Klein, you sat down with President Assad of Syria on Monday. He then on Thursday met with the Saudis, and we have pictures of that, where the Saudis leaned on him quite heavily to do the same. Yesterday he appeared before the Syrian parliament and said, "Well, I may have told Joe Klein we are getting out, but not so fast." What's going on?

MR. KLEIN: Well, you know, the president of Syria is continually being edited by his own government. It's really remarkable. I think that, you know, he tried to move some reformers in when he came in in 2000, and they were quickly ruled by the old Ba'athist war horses who actually do run the security services that run this country. He is in a terrible position. He's feeling tremendous pressure, and not least from the Saudis. A Saudi diplomat told me the week before last that what President Assad is looking at is a Sunni people power movement in Syria. And so he's sitting--well, in Winston Churchill's phrase about this area, he's sitting on top of an ungrateful volcano of a lot of different ethnic groups, and the same is true in Lebanon.

MR. RUSSERT: When President Assad escorted you to the door after your interview, he said, "Please send the message I am not Saddam Hussein. I want to cooperate." What did he say? Is he...

MR. KLEIN: "Help!" He's saying something like "Help!"

MR. RUSSERT: Well, is he afraid of military action against him?

MR. KLEIN: I don't think he's afraid of military action against him. I think he is feeling really constricted about what he can do. He knows that he has to reform that society. He knows that he has to open it up economically for sure. And he knows that he's under a tremendous international pressure right now, but he doesn't have the horses. He doesn't have the people in his government who can get him to that point.

MR. RUSSERT: Iran and North Korea.

MR. KRUGMAN: Yeah. I mean, there--I mean, this is the opportunity cost argument that Mike's making. I mean, the--we have--not only have we tied our forces and spent an awful lot of money, we've also enormously damaged our reputation. If you go back to what people were saying two years ago about U.S. hyperpower, about how the U.S. was this irresistible force--and now, even if it turns out well, which we all hope it does, the fact is the greatest power the world has ever known has been bogged down for two years fighting, really, an insurrection of about five million Sunnis. You know? And all of a sudden, the world is a lot less afraid of us. The Koreans are saying, "Hi! Look, we've got the bomb. You know, want to do something about it?" And it's very bad.

MS. O'BEIRNE: It's just...

MR. RUSSERT: Kate--let me get Kate O'Beirne in here. If George Bush looks back four years from now and says, "On my watch I liberated Iraq, but North Korea and Iran became nuclear weapons powers," will that be an effective foreign policy?

MS. O'BEIRNE: Well, an important point to make, Tim, is about American leadership. Look at Russia, Egypt, Saudi Arabia, other Arab countries rallying the French to the American point of view about Syria and Lebanon. Of course that's American leadership with our allies, who care as much as we do about stability in that region and in doing something about the terrorist threat that Syria poses. George Bush, for a president--candidate in 2000, who expected to concentrate on domestic issues, certainly has an awful lot on his plate. But it seems pretty clear what history's going to say about him, they could not say about his father. George Bush--this George Bush does not suffer from a lack of a vision thing. He has enormously ambitious vision, and much of it, I think, is being vindicated, in its early stages at least, in what we're seeing in the Middle East.

MR. KLEIN: But he does suffer from a lack of the detail thing. And the detail work that should have been done in the Korean negotiations and with Iran hasn't been done. Those are going to be big problems. But just to get back to what Paul was saying, I think there's another side to this. I talked to Saudi dissidents and Syrian dissidents who said that they were thrilled to hear an American president say that 60 years of policy in that area was wrong, that we'd been supporting oppressive governments and that's wrong.

MR. RUSSERT: The Saudi foreign minister said, "We want to reform. We want to modernize. For God's sake, just leave us alone."

MS. O'BEIRNE: Not now. Not now.

MR. RUSSERT: This is all, obviously, in a political atmosphere. Mike Allen, quite interesting. One of the senators that you cover, Hillary Rodham Clinton of New York--let me show you the latest Gallup poll in terms of the presidential race for 2008. Hillary Clinton, 40; John Kerry, 25; John Edwards, 17. What is going on?

MR. ALLEN: Well, everybody's pining for a Senator Clinton-Secretary Rice race. The New York Times has an amazing story about outreach by Senator Clinton to Republicans, Republicans holding fund-raisers for her, Republican senators working with her. And Senator Clinton is obvious about everything she does, and she's had such a clear strategy of first being quiet, working on New York issues. And there's a clear strategy unfolding here to get her toward the presidential race. Dr. Rice, when she's asked about running, always jokes about instead being football commissioner, but it's clear to everybody that's watching her that she's enjoying this role and might like another role. Republicans don't have an obvious person. There's a new primary for Republicans, the Mehlman primary, the Republican chairman, Ken Mehlman, has told all of them who want to run, you ought to raise money for the Republican Party as a first step forward getting help from President Bush.

MR. RUSSERT: As Professor Bob Schmuhl of Notre Dame keeps reminding me, this could be the first presidential election in 56 years where an incumbent president or vice president is not seeking the nomination of either party, Paul Krugman. How do you see things unfolding?

MR. KRUGMAN: I think it's just wildly up in the air. I mean, you know, there's enormous turmoil on the Democratic side trying to figure out--there's a lot of unity but there's a lot of turmoil about what the party stands for. And I just don't know. I mean, I can't--I dread the prospect of a Clinton run just because I think that would be--it would be an attempt to recreate the politics of the '90s when you had Bill Clinton, who was a president who managed to sort of triangulate. And I think we ought to have an election that's really about what what kind of country we're going to be and we won't have that if it's Hillary Clinton running.

MS. O'BEIRNE: Paul's right, though. There's so much attention paid to the Republicans on Social Security. Too few people, I think, are paying attention to the real disarray on the Democratic side.

MR. KRUGMAN: Right.

MS. O'BEIRNE: Paul represents the true believers who wouldn't want to see another Clinton presidency. And the grass roots, the active sort of angry grass roots that delivered the chairmanship of the party to Howard Dean might not want to see that kind of a presidency. But I think Hillary Clinton is a stronger candidate in that environment. She's such a known quantity that she has a lot of running room. She can move pretty significantly to the right, I think, and keep--she's been solid on national security--and keep an awful lot of those angry liberals on the reservation.

MR. RUSSERT: Well, what about the Republican side? John McCain, Rudy Giuliani, much different ideologically than, say, Senator Bill Frist or Governor Huckabee of Arkansas or Governor Romney of Massachusetts. It's not one big unified monolithic group.

MS. O'BEIRNE: No. Nor is the field ever on the Democratic side, although, unlike 2008, there's typically sort of an establishment front-runner. But the nominating--I think, the Republican primary voters are a fairly unified bunch. It's going to be a pretty conservative candidate.

MR. RUSSERT: Can you be pro-abortion rights, pro-gay rights, pro-gun control and be nominated by the Republican Party?

MS. O'BEIRNE: I think that would be extremely difficult. Probably not, Tim.

MR. RUSSERT: Go ahead.

MR. ALLEN: A problem for Senator Clinton, she's not going to be able to choose where to position herself, who the Republicans run against her. The Republican machine is going to run against the old Senator Clinton.

MR. KLEIN: Paul, I have a question for you: What was it about the peace and prosperity of the eight years of the Clinton administration that you didn't like?

MR. KRUGMAN: No, I liked the way the country ran.

MR. KLEIN: I think that he had a real governing philosophy. It wasn't triangulation. It was moving us from the industrial age to the information age, and that's where the Democratic Party is going to have to move...

MR. KRUGMAN: There's a radical right...

MR. KLEIN: ...if it wants to have any role in American politics.

MR. KRUGMAN: There's a radical right challenge to America as we know it that's under way, and I think the Democrats--I mean, maybe Hillary Clinton can do this. I'm actually not opposed to her, right? But they need to make clear that they are going to turn back that tide, not blur it.

MR. KLEIN: The answer to a radical right challenge isn't a reactionary left response.

MR. RUSSERT: To be continued. Joe Klein, Mike Allen, Paul Krugman, Kate O'Beirne, thank you all. Next up, Alan Greenspan warned about deficits this week and you'll see what he said 31 years ago right here on MEET THE PRESS.

(Announcements)

MR. RUSSERT: And we are back. Democrats and Republicans, liberals and conservatives usually find something in Federal Reserve Chairman Alan Greenspan's testimony to praise or criticize. Here he is on MEET THE PRESS as President Gerald Ford's chairman of the Council of Economic Advisers almost 31 years ago.

(Videotape, September 29, 1974):

MR. IRVING R. LEVINE (NBC News): Mr. Greenspan, you repeatedly stressed this morning the importance of cutting government spending. You've attributed the inflationary problem to a large measure to increases in federal spending. That has been a fundamental and key part of the pre-summit White House economic policy. Would those policies have worked had they been given time?

MR. ALAN GREENSPAN, (Chairman, Council of Economic Advisers): Well, actually, Mr. Levine, I'm a little puzzled by the numerous discussions around that tight fiscal policy has been tried and has found--been found wanting. I think if you look at the figures, we've been running deficits almost indefinitely over the last decade and a half, and I find it real--a bit rather puzzling as to why people somehow read these numbers in some manner as though we had some fiscal responsibility. We haven't. I think it's about time we started.

(End videotape)

MR. RUSSERT: Deficits, deficits, deficits, then and now. And we'll be right back.

(Announcements)

MR. RUSSERT: That's all for today. We'll be back next week. If it's Sunday, it's MEET THE PRESS.

Originally broadcast, 3.6.05