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Sunday, March 4, 2001

Following is the transcript of "Fox News Sunday" with host Tony Snow.

SPEAKERS:
Tony Snow, Host, Fox News Sunday
Juan Williams, Fox News
Mara Liasson, Fox News
Brit Hume, Fox News
Paul O'neill, Treasury Secretary
U.S. Sen. Robert Byrd (D-W.Va.)
U.S. Rep. Tom Delay (R-Texas)

TONY SNOW: George W. Bush is selling tax cuts, but will Congress buy? We'll ask Treasury Secretary Paul O'Neill.

Democrats maneuver between two presidents, George W. Bush and Bill Clinton. We'll discuss tax cuts, pardons and much more in an exclusive, rare interview with the dean of Senate Democrats, Robert Byrd.

Are Republicans getting squishy on taxes? Obsessed with Bill Clinton? We'll get a definitive peek at GOP strategy with House Republican Whip, Tom Delay.

And Brit Hume, Mara Liasson and Juan Williams round out the week on the March 4 edition of Fox News Sunday.

SNOW: Good morning, and welcome to Fox News Sunday.

Our guests will join us in a moment. But first, let's get the news headlines from Lauren Green at Fox News Channel in New York.

Good morning, Lauren.

LAUREN GREEN: Good morning, Tony.

Bad weather may have been a factor in the military plane crash that killed 21 in Georgia. The C-23 Sherpa was on a training mission when it went down outside Macon Saturday. Three Army personnel and 18 Air National Guard members were killed.

People on the East Coast are preparing for a major snowstorm. Forecasters predict some areas could get at least a foot of snow.

Newport News is gearing up for a big celebration this afternoon. Nancy Reagan, President Bush and other dignitaries will christen an aircraft carrier named after former President Ronald Reagan. James Rosen has a preview.

Good morning, James.

JAMES ROSEN: Good morning to you, Lauren.

We're told this ceremony is going to take place come rain or come shine. Right now we're looking at very inclimate weather, which means the ceremony might be closed to the public, but it will go forward.

In the meantime, those 94 million pounds of structural steel and one million pounds of aluminum behind me will, later this afternoon, when former first lady Nancy Reagan lets fly with a bottle of champagne, become officially the Ronald Reagan, the ninth and last of the nuclear powered Nimitz class aircraft carriers to be built.

The Navy will take possession of it officially and commission it in March 2003, and they expect it to remain part of our fighting forces through March 2053.

Reporting from Newport News, Virginia, James Rosen, Fox News.

Lauren?

LAUREN: And thank you, James.

And those are the headlines. Now, back to Tony in Washington.

SNOW: Joining us now for his first Sunday interview is Treasury Secretary Paul O'Neill. Also here, Brit Hume, Washington managing editor of Fox News.

Secretary O'Neill, the president wants to cut taxes by $1.6 trillion over 10 years. What is that tax cut supposed to do?

SECRETARY O'NEILL: Well, it does several important things.

It changes the structure of the tax system so that we're not bringing so much money into Washington that's larger than what we need to pay for agreed public purposes.

But these ideas are ideas that were developed a couple of years ago before the current economic situation. And they're ideas, I think, that are timelessly good, because they will bring rate relief and tax relief to low-and moderate-income families and bring the top brackets down from 39.6 percent to 33 percent, as an example.

So I think these are ideas that will stand the test of time. And because the economy's in a slowdown now, we think getting money back to people right away is really an important thing to do.

SNOW: The House Ways and Means Committee has only given the president about one-third of the tax relief he wanted in the first year. They've approved $5.6 billion worth of tax cuts and a $1.9 trillion budget. That's about 3/10 of 1 percent. That's not much.

O'NEILL: It's not over yet. And importantly, I think motion is a wonderful thing to see. By tradition, one might have expected this was going to take nine or 10 months. And so seeing the House of Representatives begin to move so quickly is a very encouraging sign that they agree with the general idea and they've decided to produce a bill that would make these tax changes retroactive to January 1.

SNOW: But from an economic point of view, wouldn't it be better to have a larger tax cut the first year?

O'NEILL: As I said, I think it's not over yet.

And importantly, if you think about how people respond to anticipated tax reductions, if you know that you're going to receive over a period of time, say, for a four-person family in a low-income bracket, $500 a year reduction in your tax, maybe putting you into a zero tax bracket, if you think about what that means to a family and what they can do with it, $500 would support an additional $5,000 worth of mortgage on an annual basis.

So that I think it's the anticipation effect--it's both the reality and then the anticipation effect that people will make of these proposed tax changes.

BRIT HUME: The reduction of the top rate from 39 down to 33 percent is likely to attract the most fire from critics as simply what will be called a tax give-away to the rich. And clearly, obviously, because the rich pay more, they obviously get more relief when there's a tax cut, particularly one of this kind.

But what would you argue are the economic benefits to all from the reduction of the tax rates to a relatively few?

O'NEILL: Well, I would argue this. First of all, it's kind of interesting to see where we've come from. People lose track of where we've come from. In the 1986 tax act, the top bracket was taken down to 28 percent. In fact, eight years ago, the top bracket was 31 percent. And so people lose track of where we are and where we've been.

The president's proposal would reduce the tax rate from 39.6 to 33 percent, just as you say, but it wouldn't take us back even to where we were.

And because of the heavy loading toward low and moderate taxpayers, this tax bill would, in effect, make the tax system more progressive than it is now, which means higher-income taxpayers are going to pay more in a relative sense than they do now.

HUME: Still, Mr. Secretary, the argument is going to be made that the very richest people with the largest incomes and the most disposable income are going to receive what will look to the critics like a windfall.

Do you believe that there are economic benefits other than enlarging their wallets from a tax cut on 6 percent reduction?

O'NEILL: There's no doubt about it. I think one of the things that goes undetected outside of Washington is that a lot of the people who are paying the highest tax bracket are small entrepreneurs and so-called S-chapter corporations.

And so there's going to be a benefit to effectively what's the engine of economic growth in our society, which is the small and medium-size enterprises are going to have their tax-rates reduced. And that's going to be very pro-economic.

SNOW: The president has also said he wants to limit budget growth to 4 percent. You've indicated that it's important to bring less money into Washington. Pete Domenici, chairman of the Senate budget committee, says no, we're going to need 6 percent. Will the president veto that?

O'NEILL: Well, I don't know. You know, there's only one president. And if we get to that pass, I suppose we'll have to deal with it.

One of the things I think is very interesting, no one has put a number on what 4 percent means this year and then carrying it out through the next 10 years. What that means is an increase in federal spending of $5.2 trillion from where we are now to where we would be in 2011. You know, where I come from, $5.2 trillion is not swiss cheese. That's an awful lot of money.

And you know, again, I think most people out there in the real world don't begin with the proposition of somehow you get a free ride if 3 percent or 4 percent increase. In an enterprise, what you count on is your prices are not going to go up, you're going to have to figure out a way to reduce your costs to be competitive. So you don't have this never-never land where you just assume away 4 percent and then you start talking about adding spending on top of that.

SNOW: So, you think the senator's approach is wrong?

O'NEILL: The senator's view probably is appropriate to what's happened in Washington in the past, which is there's an endless appetite for spending. But I think that we can work together in a good faith way. We ought to be able to live within 4 percent. It ought to be a cakewalk to live within 4 percent.

HUME: Mr. Secretary, you said just a couple weeks ago that this economic downturn we're experiencing may be--may have run its worst, anyway, if not run its course. Since then, we've had cries of pain from the likes of John Chambers of Cisco Systems saying this is a full-blown recession. Other corporate chiefs are saying much the same thing. Alan Greenspan, testifying, said, you know, this hasn't run its course yet. Do you still believe that the worst is behind us?

O'NEILL: Well, I don't think I said that it's run its course. What I've been saying is this: From the data that I see, I think our economy is running in a range someplace between a minus .5 real growth and plus .5 real growth, which means we're bouncing around at about zero real growth in the economy.

And the data right now is very conflicted. If you see the reports from the automotive sector for the month of February, it's interesting that their rates, the final sales, which is a very important measure, were up again in February over January.

And their inventories are going down. This is really very important. General Motors inventories, I think, have gone from 106 days to 87. Ford's have gone down to about 80 days worth of inventory. Diamler-Chrysler is down to 59 days.

SNOW: What does that tell us?

O'NEILL: It tells us that the inventories that had overaccumulated in their systems are being brought down by the continued sales that they've had in January and February. And when they get down to about 60 days' worth of sales, that's an indication that the companies are going to have to start putting production lines back on to keep up with the level of demand. So that's a very positive indication.

On the other hand, you do have Cisco and others saying, things are not very good.

HUME: Well, what is your judgment then? Are we headed for a quick turnaround? There's a lot of talk about whether we're going to have a u-shaped turnaround in this economy, which means that we're likely to bounce along with growing unemployment for a while, or a v-shaped recovery, which is sharp and a quick upturn. What's your view?

O'NEILL: Well, let me tell you my hope. My hope is that we're going to see a substantial recovery. And I hope it's going to be fairly soon, because everything that we care about in our society is easier to do and easier to accomplish when the economy is running at 3 or 4 percent real growth rate. So I'm hopeful that we're going to see a quick rebound.

But we've got to look at the data to see where we're going. And I think it makes the case that with what Greenspan is doing on interest rates and if we can act quicker than ever on tax relief, that we can be pro-economy and make sure that things move back quickly.

HUME: Do you believe interest rates must continue to fall?

O'NEILL: I'm going to leave monetary policy to my good friend, Alan Greenspan. It's not up to me to make...

HUME: Well, would the economy benefit if interest rates were lower?

O'NEILL: I'm going to leave it to Mr. Greenspan. I'm not going to dabble in his world. If you've watched his testimony in the past couple of weeks, he's been very careful not to have a personal opinion about the size of the president's tax proposal or the budget recommendation. And it's good that we have these territorial boundaries.

SNOW: Let me ask you a couple of quick questions. Number one, should we change the way that we project tax cuts, the effects of them? Should we do so-called dynamic scoring?

O'NEILL: Having come back here now after being away for 23 years, there are a whole lot of things that we need to change, including, I think, we need to give a realization to the fact that there are different ways to think about these matters.

And doing so-called static scorekeeping has a defect of not including all the dynamics of what's going on in our economy. So I think you make a case for it. At least we ought to entertain the possibility. What is dynamic scoring saying as compared to stats? This is all Washington-speak now. I'm sure a lot of people don't understand any of this.

But yes, we need to change the way we think about things. As an example, you know, in this whole conversation about the distribution effect of the tax benefits, no one has asked me a single question about what's going to happen to the level of spending for directly redistributive programs like Medicaid and housing subsidies and food stamps and all the other things we do for low-income populations.

The answer is that we're going to grow from, I don't know, $265 billion worth of those kind of programs this year to the last year at this time period, $465 or something. So we're going to have, over this time period, $3.7 trillion worth of redistributive programs.

Nobody asked me the question. It's almost as though we live in, you know, a one-cylinder-brain environment or something. People don't connect what's the society doing in a broader sense. And I'd like to help try to help broaden the scope of the field of consideration.

SNOW: OK, Secretary O'Neill, come back soon and we'll continue that dialogue.

O'NEILL: Happy to do it.

SNOW: We're going to take a break. Up next, a Washington monument speaks.

Late Friday afternoon, I sat down with the senior Democrat in the United States Senate, Robert Byrd of West Virginia. In a wide-ranging interview, I began by asking what he thinks is the appropriate size of a tax cut.

(BEGIN VIDEOTAPE)

SEN. ROBERT BYRD: I think that's something we need to talk about. I am not against a tax cut. For example, the marriage penalty, I think we ought to work on that. My wife and I have been married 63 years. I think we ought to quit underwriting cohabitation by our tax code. So there's one area where I would suggest we cut.

As to the president's tax cut, I am concerned that the projected surpluses will not materialize. If we pass legislation providing for that president's tax cut of $1.6 trillion over a period of 10 years, once that legislation is passed, the money goes out. That's real, there's no guesswork about that.

SNOW: Well, Senator ...

BYRD: It may be up front to give a rebate, but let's take it a little slower and be sure that these projected surpluses are going to happen.

SNOW: I almost cut you off there. A rebate? What do you mean--what size of a rebate are you talking about?

BYRD: I don't have a particular size in mind. I do think that, in a matter of this kind, it's so important to our country that we stop, look and listen and that we debate, we examine, we scrutinize, we discuss. This is why I don't believe that we ought to enact this tax cut on a reconciliation bill. And this is what I've been, kind of, complaining about.

SNOW: But even though you don't like the way some people are proposing using it, there's nothing much you can do about it, is there?

BYRD: Well, we're 50-50 in the Senate, and the new president has said that he wants to have bipartisanship. And so, this is a good way to have bipartisanship, is to open this up. And if we're going to debate this tax cut, let's do it on a separate, free-standing bill and reach a time limit on that, 50 hours or whatever and no non-germane amendments is OK. We often have unanimous consent agreements to that effect.

And this would ensure against any filibuster that would kill the bill, but it would give the Senate a chance to adequately inform the people, adequately amend and debate and let the Senate work its will and reach a conclusion.

SNOW: You've got this concern about the way the Senate may vote on it. Has Senator Lott indicated any inclination to have the wide-open debate which, as you've pointed out, are the same set of rules that Ronald Reagan used.

BYRD: I've had no conversation with Mr. Lott about this. I have written him a letter. I've also written a letter to Senator Daschle urging that we do this on a free-standing bill and not under the very tight restrictions of this super bear trap which we call reconciliation.

You see, I'm not a Bushphobe. I'm an anglophile, but I'm not a Bushphobe. I voted for Mr. Bush on his attorney general. From time to time, I'll vote with him again. But I'm very much against the tax cut. And for the reason that we don't know that these educated guesses called projected surpluses will ever come about.

SNOW: What do you think's going to happen with the tax cut? Do you think the president's going to get more or less what he wants?

BYRD: I think he's got a tough way to go to get everything he wants in that tax cut. I think it would be well for him to demonstrate the kind of bipartisanship that he's been talking about. It's one thing to talk about it.

But with a 50-50 make up in the Senate, he's going to have to have some bipartisanship. And if they try to ram that $1.6 trillion tax cut through this Senate by way of this super gag rule reconciliation, they're going to create a lot of ill will, and I'm not so sure they'll get their tax cut.

SNOW: Do you support the president's proposal that schools that do not educate children should be given three, four, five, six year warning thing--if you don't measure up, if you don't give the education to these kids that they deserve, then we'll give the money to the parents and they can find a school that works?

BYRD: I don't have any problem with that.

Why keep schools if they're not producing?

Also, I'm for taking the roughnecks, the toughies, out. If we need to build a special building for them, let's do it. Let's find some way to get them out of the schoolroom. I don't see how teachers can teach or how students can study when there's this fear that these loudmouths--and I'm not for loudmouths, I don't care what color they are or who they are--when they keep the schoolroom in fear.

SNOW: What do you make of Bill Clinton's pardons the last day of his presidency?

BYRD: Malodorous. They stink. I think he abused the constitutional power that is there for purposes when there's a need to make justice out of injustice, to correct an incorrection. But they were abused.

SNOW: Nothing anybody can do at this point?

BYRD: Not a thing we could do except amend that Constitution, if that's what we want to do. And that won't be easy to do.

SNOW: Would you support a constitutional amendment?

BYRD: I might. I'd like to see how it's drawn.

SNOW: His wife is one of your colleagues. How has this affected her ability to function within the Senate?

BYRD: I can't answer that. I can only see through a glass darkly. My perceptions are that she's going about her work in a very serious and dedicated manner. She and I are both new members on the budget committee, and I think she's doing fine. I think she wants to be a good senator, and I think she is trying to be a workhorse.

SNOW: You attended George W. Bush's speech the other night. You didn't attend any of Bill Clinton's State of the Union addresses.

BYRD: No.

SNOW: Why?

BYRD: I didn't care for him. His lifestyle didn't match mine. I'm not saying that I'm an icon of perfection, but I didn't care for him. He's bright, exceedingly intelligent, smart and good with audiences, but...

SNOW: What is his legacy to your party?

BYRD: His legacy, you can see it right here on Capitol Hill and down at the other end of the avenue. We have a Republican House, a Republican Senate and a Republican White House. That's part of his legacy.

SNOW: What's the other part?

BYRD: A lowering of the standards of our culture, I think.

I've been in Washington now 49 years. And in these past few years I've seen a more rapid deterioration in the country's culture than ever before.

SNOW: Let me throw a couple of names out at you and a couple of issues and just get quick reactions.

Jesse Jackson?

BYRD: Well, I've never been an enthusiastic admirer of Jesse Jackson. He made a bad mistake. We all make mistakes. I made a mistake when I was a young man. It's always been an albatross around my neck, in joining the Ku Klux Klan. We all make mistakes. We can strive to overcome them. That's his situation. What he and his God work out between themselves, that's their business.

SNOW: Terry McAuliffe?

BYRD: Bad choice.

SNOW: Ronald Reagan?

BYRD: Ronald Reagan was a very likable individual, charming personality. He had one or two or three or four ideas about government, and he kept those ideas in front of him always. I have often said that he didn't know a lot about the federal government when he came here, and when he left here he hadn't learned a great deal.

SNOW: Race relations?

BYRD: They are much, much better than they've ever been in my lifetime. I think we--this is my personal opinion. I think we talk about race too much. I think those problems are largely behind us. I think we can all profit by our mistakes. I think we've reached a new plateau, and I think it's going to keep going upward, that understanding and race relations.

I just think we talk so much about it that we help to create somewhat of an illusion. I think we try to have good will. My old mom told me, ``Robert, you can't go to heaven if you hate anybody.'' We practice that. There are white niggers. I've seen a lot of white niggers in my time; I'm going to use that word.

We just need to work together to make our country a better country, and I'd just as soon quit talking about it so much.

SNOW: Are you going to run again?

BYRD: Well, I'm 83 now. Abraham lived to be 175. Isaac was 180. Jacob, 147. Joseph, 110.

But the people of West Virginia have been good to me. I know to whom I owe my blessings: to them and to the good Lord.

(END VIDEOTAPE)

SNOW: Now, after our conversation Friday, I went back to visit with Senator Byrd, and he said, ``There is a term I used in our discussion of race relations that people may misconstrue.''

And his office has put out the following statement regarding that. It is, quote, ``I apologize for the characterization I used on this program. The phrase dates back to my boyhood and has no place in today's society. As for my language, I had no intention of casting aspersions on anyone of another race. In my atempt to articulate strongly held feelings, I may have offended people that I intended to offend. Unfortunately, there are people in every race who would rather attackothers simply because of ill-conceived, false stereotypes based on skin color. People who do this are obstacles to positive race relations and become the stereotypes that they despise. But by working together and continually improving the understanding between the races, we can overcome these narrow-minded people and the obstacles that they represent.''

We're going to take a break. Up next, the man they call the hammer, House Majority Whip Tom DeLay.

(BEGIN VIDEO CLIP)

(UNKNOWN): His numbers simply do not add up.

(END VIDEO CLIP)

(BEGIN VIDEO CLIP)

(UNKNOWN): These are the people that had deficits and never balanced the budget.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

SNOW: George W. Bush laid out his legislative agenda in a speech Tuesday night to Congress. How much will the people on Capitol Hill give him? We'll ask House Majority Whip Tom Delay.

Also joining in, Fox News contributor Mara Liasson.

Representive Delay, first, the question is spending. The president says, no more than 4 percent. Can you enforce that?

REP. TOM DELAY: Boy, I hope so. It's so refreshing to have a president coming into town that wants to impose fiscal discipline.

You know, we've been fighting for six years to hold down spending, and we've been able to do so to a certain extent. But when you have a president that wants to spend and spend big amounts of money, it's very difficult to do so.

Now we have one that does want to hold it down, hold it down to a 4-percent increase. The House will go along with that, and we hope the Senate will follow.

LIASSON: Congressman Delay, just to follow up on that, the last Congress was the biggest spenders in 25 years, and it seemed like your party was right there, colluding with the White House to boost spending. What makes you think it's going to go in the opposite direction this year?

DELAY: Well, Mara, you are absolutely right. I voted against that last bill, it was a huge amount of spending.

We tried to hold it down. We went all the way through the whole year fighting off the president wanting to spend more, and, frankly, some Republicans, particularly in the Senate, that wanted to spend more money. And we helped try to hold it back as much as we could.

But that shows you that, when you have a president that has a proclivity to higher spending, it's very difficult to hold it back. But now we have one. We have one that understands fiscal discipline, fiscal responsibility, understand budgets, understands that you can go into these agencies and find ways for Washington spending.

And he's going to work very hard to do that, and the House certainly has. The House, over time, has held the line on spending. They will continue to hold the line on spending, join this president to do so. And hopefully we will not have any more spending than 4 percent.

MARA LIASSON: One of the things that seems to have disappeared very early on is bipartisanship. You saw what happened in the committee. The tax cut didn't get Democratic votes. What happened to bipartisanship?

DELAY: Well, Mara, unfortunately, the Democrat leadership in the House and the Senate's definition of bipartisanship is, if you buy into their partisanship, they'll go along with you.

They're the ones--we have reached out to them, the president has reached out to them. I have had several conversations with individual members, trying to come to some sort of agreement. They won't even talk to you about coming together on some sort of program. They're more interested in throwing up smoke screens, fudging the numbers around so it looks funny.

They're not interested in cutting taxes, everybody knows that. When they were in charge, they never offered tax relief programs. They always raised taxes.

So we just have a difference of opinion on this, but we're going to go forward. We're going to have some Democrats helping us. There are some bipartisan Democrats in the House and in the Senate, and we're happy to work with them.

SNOW: Mr. Delay, you've just given what you say is the Democratic definition of bipartisanship. What is your definition? What would you like to see them offer to you, and what are you prepared to offer to them?

DELAY: I would like for us to sit down in a room and work on a budget. I would like for the leadership to come to the table, and let's talk about tax relief, of actually taking this tax surplus and giving it back to the people who earned the money.

But they don't want a tax cut. They say they do. But I've got to tell you: Every time we've tried to talk to them about a tax cut, they just don't want to come together on anything.

SNOW: Well, House Speaker Hastert, I believe it was last Wednesday, said he thought some Democrats actually wanted a recession, that it would be politically good for them.

DELAY: Well, that's the result of their strategy. They don't want us to do a tax cut until we pass a budget. We can do both. You know, a legislative process isn't exclusive to passing one bill. We can move a budget, it will be done before we actually get to a conference committee with a tax relief bill put together to send to the president. These can run concurrently.

But they're arguing that you can't do that. Well, the effect of that is, is that you don't get a tax cut to the president till the end of this year. And that will not give us as big a bang for our buck when it comes to helping the economy.

LIASSON: How many Democratic votes are you going to get on the floor this week when the full House votes?

DELAY: Well, Mara, you know me, I don't talk about numbers. We'll get a few.

LIASSON: Well, give me a range.

DELAY: Well, I don't even like to do ranges. We'll get a few, very few unfortunately, on this particular bill. But when we come back with repealing the death tax, we'll get a big number of Democrats for that. We already have. When we come to eliminating the marriage penalty, we'll get a large number of Democrats. But we won't get the Democrat leadership voting for any of these tax relief packages.

LIASSON: Well, I want to ask you again about this notion of bipartisanship, because Democrats say, if you really did want to negotiate something--in other words, bipartisanship to them isn't just getting Democratic votes for the president's plan, it's actually working out some kind of a compromise.

And you heard--I don't know if you heard the Senator Byrd interview earlier, where he said if they can't sit down and talk to us, it's going to create a tremendous amount of ill will, and this thing is going to fall apart in the Senate, where you really do need bipartisanship because the body is so evenly split.

You pushed that tax cut through in one day. It didn't sound like you left a lot of time for negotiating. Are things going to be different in the future?

DELAY: I don't want to speak for Chairman Thomas of the Ways and Means Committee. He's done a terrific job.

But I would suspect that he reached out to his Democrat counterparts on the committee early on, said we're going to do this bill, would you like to talk about it, and they refused to do so.

They voted in bloc against the bill. They voted in bloc against the bill that the president signed in 1997, and then came back to the floor and voted for the bill.

This is all partisan maneuvering on their parts. They would rather put politics before people. Unfortunately, the leadership does. There are rank-and-file members that we are working with, and we'll work with any rank-and-file member that wants to work with us. And we'll sit down with any Democrat that wants to work with us.

Unfortunately, the Democrat leadership would rather have an issue, would rather have the politics than really get something done.

SNOW: Mr. DeLay, Don Nichols, your counterpart in the Senate, says that he wants to put through legislation that would basically repeal a lot of the last-minute regulations put in place by President Clinton. Is the House ready to go along with that?

DELAY: Absolutely. We're working on it right now. The president put the most onerous regulations on small businesses that has to do with ergonomics. I won't get into the details of it, but it is unbelievable.

And in fact, it's been estimated that it would cost $22,000 per job just to implement these regulations.

SNOW: So those regulations are going to be gone?

DELAY: We hope so. We're working very hard to get rid of them and come back and really do something meaningful and reasonable.

SNOW: OK, the other question that a lot of people have been talking about here in town: pardons. The House Government Reform Committee has been holding hearings. Is that pretty much the end of the road for the House hearings?

DELAY: I don't know. It depends on what further investigations show.

I think Chairman Burton has done an outstanding job in dealing with a very difficult subject. It's very important, when a duty has been abused like the president has abused his pardon process, that we look into it, so that future presidents won't abuse it this way.

I hope that the Justice Department will continue--the U.S. attorney in New York will continue with the investigations. Because if there was a quid pro quo, we should know about it, and people should be prosecuted.

LIASSON: Do you think that the Government Reform Committee has unearthed any actual evidence of a quid pro quo, of illegality?

DELAY: Mara, I wouldn't know that. I've been dealing with tax relief and stopping the raid on Social Security and balancing the budget and working on an education package.

Chairman Burton has been doing most of that. We haven't even talked about what he knows and what he doesn't know.

SNOW: So, final question, you just mentioned some of the issues you're working on.

Social Security: Are we going to see, before the end of this presidency, before the end of this term, a Social Security system in which people can make private investments?

DELAY: I think so. I'm very encouraged by the bipartisan nature that the president is talking about going forward with reforming Social Security and giving people the opportunity to own their own private retirement accounts. And there's been a lot of talk from Democrats that they want to work with us on this. The president is dead set to do it, and if I know George W. at all, he's going to make it happen.

SNOW: All right, Tom DeLay, thanks for joining us today.

DELAY: My pleasure.

SNOW: Up next, our panel on pardons. Stay tuned.

(BEGIN VIDEO CLIP)

BETH DOZORETZ: I respectfully decline to answer that question based on the protection afforded me under the United States Constitution.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

SNOW: And we're back with the panel: Brit, Mara and Juan Williams. And we're going to start out with the issue we just teased: pardons.

We had pardon hearings this week, Juan. We found out a lot of people are running around the White House doing all sorts of stuff. But what conclusions do we draw from all this?

JUAN WILLIAMS: Well, I think the president waived his immunity to allow top aides to testify, including the former White House chief of staff John Podesta. And they all say they advised the president don't do this, this is a bad idea.

So, I've got to think that Bill Clinton wants the idea out there that this was not a matter of corruption, it was a matter of him simply acting badly, you know, simply making a mistake.

SNOW: What's the difference between corruption and acting badly?

WILLIAMS: Well, corruption would be bribery, and I think that's at the bottom of it, Tony. If there's a matter of bribery, if you can prove that, in fact, people were making contributions to the Clinton library fund out in Arkansas in exchange for pardons, then you do have something much larger. But we're not there.

And I think that's why lots of people say, what are we going through with this for? Why do we have two congressional committees operating, when the Congress can't do anything about it? If Mary Jo White wants to do something, bring some criminal charges, let her do it.

LIASSON: It doesn't seem like the Government Reform Committee has a huge appetite to go forward, but one thing they didn't uncover in those hearings is any evidence of a quid quo pro. All three of the White House aides who testified said they didn't know about it.

Now, the one person who might have been able to help them advance that theory, help the Republicans advance that theory, took the Fifth, and that was Beth Dozoretz.

SNOW: But there was also a very intriguing e-mail between people involved in the Marc Rich team that talked about sending Denise Rich to the White House with a well-prepared script. And lo and behold, after the date of that e-mail, her contributions began. Does that mean anything?

HUME: Well, the idea had gotten a hold that the contributions to the library or other political contributions couldn't have had anything to do with that because they all occurred before the pardon negotiations. It turns that isn't true.

I think, Tony, what's driving this now is that there is still no satisfactory, anywhere near satisfactory, answer to the question: Why?

We now know, which we didn't before, that all these advisers that Juan described advised against the pardon. The idea that they're foreign policy reasons is cast in doubt by the fact that none of his foreign policy aides were ever consulted about this pardon, that we know of.

Then you've got people taking the Fifth, that's usually not a good sign. And people say, well, there's no evidence of criminality here. Well, if key players are hiding behind the Fifth Amendment, that's usually a sign there's something to be found there.

So, I think that the mystery of this continues to drive it. Until there is some rational explanation, it won't go away.

SNOW: Now also the New York Observer, a sort of liberal organ in the city of New York, came out with a steaming editorial that said the following: ``It is clear now that we,'' New York voters, ``have made a terrible mistake, for Hillary Rodham Clinton is unfit for elective office. Had she any shame, she would resign.''

They're shocked, shocked. Why should she be taking the fall for this?

LIASSON: Well, I don't really understand why she should resign. Now, she has plenty of questions that she hasn't answered adequately to many people's minds. I think that was kind of extreme solution. The voters of New York gave her a pretty big margin, and they will have a chance in six years to get rid of her if they want to.

But Hillary Rodham Clinton basically said she knew nothing at all. She didn't know that her brother was accepting money to lobby for two of the people who got clemency. She wasn't involved in any of the discussions about the pardon decisions. And she basically did paint a picture that in the White House in the last two weeks, when Hugh Rodham was around a lot, that she and the husband and her brother had no discussions at all about this.

WILLIAMS: That's a little unbelievable. But, you know, I mean it's like, you know, the ``Sopranos'' come on again tonight. It's a bit like you imagine Hugh and Tony, the brothers, and Bill Clinton. And there's this huge...

SNOW: And his brother.

WILLIAMS: And his brother. They're all in there.

HUME: All in the family.

WILLIAMS: Everybody's got some angle they're working. Right, you know, and I'm going to get so much of this.

HUME: But nobody knows about what anybody else is doing.

WILLIAMS: But how can she say she didn't have any conversation, she had no knowledge? I mean, Hillary Clinton is a smart woman. I mean, that's why she's in the United States Senate.

She's a very capable person. The idea that she was unaware of the central activity going on in that White House for the last two weeks of the Clinton presidency is ridiculous.

LIASSON: You know what? What still hasn't been answered clearly--over and over again, the Clintons have said in statements or verbally they didn't know that Hugh Rodham, Mr. Clinton's brother-in-law, was taking money to lobby.

Well, my question is: Did they think he was lobbying for free, which people usually don't? Or are they saying that they didn't know that he was even advocating for these men, which I think is improbable?

HUME: They haven't said that.

LIASSON: They haven't said that. They have not said that.

SNOW: It's been indicated that the president was aware.

HUME: Yes, the president was aware that Hugh Rodham was involved.

LIASSON: Yes.

SNOW: All right.

Also, Bill Clinton is also out, once again. The NAACP was having its Image Awards last evening, which will later be broadcast on Fox. And the president was receiving something called the President's Award. And let's take a look at some of his comments.

(BEGIN VIDEO CLIP)

FORMER PRESIDENT BILL CLINTON: I'm going to take this home and put it up and be glad I got it, because it sort of balances out what else I've been getting here the last few days.

(END VIDEO CLIP)

SNOW: So, Brit?

HUME: Well, it's remarkable to me. I mean the African-American community has been endlessly loyal to Bill Clinton. There seems to be a real bond of affection and so on there. And one would think there'd come a time, though, in the case of something like the Marc Rich pardon, when a lot of African-Americans would begin to say, look, there are people rotting in jails for a lot less than what he's accused of, and Marc Rich gets off, and that drug dealer from California gets off...

SNOW: Carlos Vignali.

HUME: Carlos Vignali gets off. What's going on here? But it hasn't started to--it hasn't happened yet.

LIASSON: Well, I mean, Bob Herbert, who's an influential columnist for the New York Times, had some pretty harsh things to say about Mr. Clinton.

I don't think the African-American community has broken with the president in any way, shape or form, but I think it tells you that he can rehabilitate himself, starting right there, over time. I don't know how far he can come back, but the president is not without clout.

WILLIAMS: Well, you know, he relies heavily on the African-American community. I mean, obviously, that is the bulwark of his constituency.

The question is: At what point do you say you're not getting something back? I mean, the old argument is, you know, the Democrats take us for granted, Republicans ignore us.

But, in that context, you say it's about Bill Clinton, because if Bill Clinton was truly serving the interests of the African-American community, much the way that Mara just said, you think about criminals, people in jail for far less, you think about the problems in the schools that Mr. Bush is now attempting to deal with, you think about racial profiling, things that didn't get done under the Clinton watch. And you start to scratch your head and say, ``Wait a minute, is this more of a cult attitude? It's sort of OK to like Bill Clinton, and you're supposed to, but, really, what did we get for it?'' And you start to wonder.

SNOW: He just mentioned President Bush. President Bush gave his--well, his first big address to Congress. How did he do, Mara?

LIASSON: He did well. The polls show that most people liked what they heard. He didn't get as big a viewing audience as President Clinton did, usually, but...

HUME: Yes, eight years ago. He did plenty as well as he did four years ago.

LIASSON: Yes, but he had a good first run. His tax package sailed through the Ways and Means Committee. It's on its way to getting passed by the House this week. He was out in the country targeting states where he won overwhelmingly but that have Democratic senators.

And what's interesting is, we talk a lot about that he didn't get the popular vote, and that's true. However, if the election was on states alone, and that is how the Senate is set up, he won overwhelmingly. He won a tremendous number of states.

HUME: Yes, he won 30 states.

LIASSON: And the Senate is run by equal representation among the states, and that's where this tax plan is going. And there are a lot of Democrats who are on the hot seat now.

SNOW: Now, there's an interesting sub-plot here, Brit, which is media coverage of this.

HUME: Well, the most conspicuous example is CBS News did an overnight poll--a pretty good-size sample overnight poll following the speech, and found that 88 percent of those who watched felt the president was expressing their priorities. In addition, 67 percent of the people in this poll, whether they watched the speech or not, favored the tax cut. That poll went unmentioned on the CBS evening news.

By the next night, the CBS evening news had a report talking about new polls showing that people favor the Democrats' plan. A search for what that poll is has not turned up anything convincing. We're not sure. There is an ABC News poll that may tend to reflect that, we're not sure. But some of the media coverage has been truly odd.

LIASSON: Well, the polls that I think Democrats are hanging on to with their fingernails are polls that show, when voters are asked to make a list of their priorities and what's at the top, tax cuts are not at the top. Using the surplus for Social Security or Medicare is at the top, and tax cuts are way at the bottom. And that is more reflective of the priorities that are expressed in the Democrats' plan.

HUME: You know, you can--it's interesting about tax cuts that is this: that people in polls, for 20 years or more now, have indicated that they really don't care a lot about tax cuts. That's not how they vote.

Now, I think some of the credibility of tax cuts has gone because Bush broke his promise, Bush the First, and because there was never a major tax cut under Clinton. In fact, there was a major tax increase, as there was under Bush.

But people like tax cuts, and, if they think they were going to get one and it's denied, I think Zell Miller may be right that the voters will take it out on him.

WILLIAMS: I think the Democrats' response on this point, Brit, was interesting, which was, you heard Dick Gephardt from the House Democrats, leader, say: You know, think back to '81. And Tom Daschle, the Senate Democratic minority leader, said the same thing. Think back to '81 and the Reagan tax cut and what happened in the aftermath, drive up deficits, interest rates go up.

And you have problems...

HUME: Oh, Juan.

SNOW: Ten seconds, Brit.

HUME: What happened after the '81 tax cuts is tax revenues exploded upward. They went up 50 percent during the decade of the '80s. The problem was spending went up more.

SNOW: And we'll continue this argument for many weeks to come.

Thanks, panel.

When we return, my parting thoughts on moving on.

Well, the House investigators had another fun week poking into the final days of Bill Clinton's animal house. They discovered lots of stuff. For instance, that stray lawyers were answering White House phones in the wee hours of January 19, that yet more money changed hands between the extended Clinton and Rodham families and clemency recipients. They heard from disoriented staffers, well tailored lawyers, and a Republican or two, not from Beth Dozoretz.

In any event, now they have to decide where to go next. Here's the answer: home.

Congress isn't going to find smoking guns or indisputable violations of the law. It can only unearth a few petty thiefs pleading the Fifth or ex-staffers willing to present arguments that would strike even a 5-year-old as impossibly far-fetched, such as the claim, also popular during l'affair Lewinsky, that everybody does it.

As President Bush has said, it's time to move on and save future televised appearances by the Clinton crew, if any, for the courtroom.

That's it for today. Have a great week, and remember to start your Sundays right here on Fox News Sunday.