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Interview: Former Chief Spokesman for Bill Clinton

>> the war in iraq claimed another victim. defense secretary rumsfeld? a group of retired generals have been speaking out, calling for rumsfeld’s resignation. the president strongly defended him. joe lockhart, storm―former chief spokesman for bill clinton, i asked him how it’s playing politically?

>> it’s just another problem for the iraq policy but it’s not really news to most americans. most americans look at iraq as a mistake. they look at a lot of the errors that were made. you can see that in the polling number. for the president, abandoning rumsfeld at this point is abandoning his signature issue so i don’t think he has a lot of choice. i think standing behind him strongly, given his weak position, is probably the right political decision.

>> there’s also an argument that the military is under civilian control and that firing rumsfeld, because these generals want him to, would be setting a bad precedent. is that a valid argument, at least?

>> i think so. i think that we do have a military in this country set up to be run by civilians, by elected civilians. i mean, the commander in chaev is the one who makes the final decisions. he gets to appoint his defense secretary and the senate gets to confirm that person. it should be by civilian control. there are a couple of other things―so i think they’re right on that. i think it would have been better for some of these generals to speak at the time but i think we found out from the case of general showntechy about what happens when you speak out in this administration while you’re still active duty. you become retired very quickly. so i think there was an atmosphere of intimidation that obviously hurt some of the decisions that were being made based on what these generals are saying now.

>> polls already show americans turning against the war. do you think this contributes to that? and does it help democrats in the fall? does it have that kind of legs?

>> i think it gives some legitimacy to some of the concerns that have been out there, some of the concerns that the democrats have been voicing. i think until these six or so generals came out, there were some people saying it was partisan sniping and now we know, from at least these retired generals, that it’s more than that. i don’t think it has an incredible impact, though, because i think the impact’s already happened. there are not very many americans right now who still think the war’s being prosecuted properly and that we went into this with the right plan to both win the war but to win the peace.

>> switching subjects, now. the president has hu jintao, president of china here this week. two questions, one inside and one outside. from the inside, the president, any president needs the help of china on a number of issues -- north korea nukes, iran nukes, that sort of thing―how much from your experience inside the clinton white house does that weigh on the kind of pressure you can bring on a country to change its economic policies?

>> it’s why foreign policy is complicated and not black and white, like the president sometimes likes to project. we need china economically. they hold an enormous amount of debt in this country and if they decided to play economic games, that could have a devastating impact here. we need them, you said on korea. we also need them on iran. they do sit on the security council at the u.n. we aren’t able to go in and dictate the changes we want, whether on human rights, whether it be on currency manipulation and trade. we have to go in and encourage and create incentives back and forth in a working relationship and that can kind of get messy from awe public relations point of view. you want to appear strong but it’s a very complicated issue and it’s one i’m sure the president doesn’t relish.

>> outside question, from that public relations point of view, is this something that opponents of the president or the administration on either side of the aisle can really make hay on? does it have enough resonance with the public that’s used to paying low prices at wal-mart for chinese-made goods?

>> i’m actually surprised that it hasn’t been more of an issue. looking at the end of 2004, the presidential election, i think i made the prediction, i might have been sitting in one of these chairs, that i thought china and trade would be the signature issue of 2008. i think we’re still working through iraq. so we haven’t resolved that. but i do think it’s an issue with tremendous potential because the president―anyone sitting in power, democrat or republican, as i just said, can’t go in and really strong-arm the chinese any longer. but china does represent a lot of what’s wrong with what americans think―you know, jobs moving overseas, outsourcing, the trade laws not being enforced. so i think this issue has tremendous potential. i don’t think either party has tapped into it yet in a way that would move an election.

>> only got less than a minute left, here. anybody in washington talking about actually sanctioning china? is that a possibility? >> i don’t think so. i think there’s going to be some tough talk. there’s rarely tough talk when the chinese premier is in the u.s. but i haven’t heard real discussion about sanctions. as your first question on china suggested, there’s just too many layers to this policy, too many things that we depend on the chinese government to work with us on to go in and use that hammer approach that we’re going to sanction you if you don’t do this or do that. we don’t have that ability to do that with china right now.

>> joe lockhart, former white house press secretary, now a partner at the glover park group. up next, guess who can’t figure out the federal tax code by themselves? here’s a hint―they’re the ones who wrote it up that’s coming up on “money & politics.”
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Listen Focus: China's third biggest bank

>> china’s third biggest bank is denying a report it’s in early talks with bear stearns to buy a minority stake in the securities firm. a beijing-based spokesman at state-owned china construction bank says the bank has no plan for that and there are no talks going on. the “wall street journal,” citing unidentified people familiar with the matter, said earlier today c.c.b.’s president planned to meet bear stearns’s chairman and chief executive officer, james cayne, today. according to the journal, china would invest $2 to $4 billion into convertible bonds to be converted into shares, giving the chinese lender a 10% to 20% stake and make it the firm’s biggest single shareholder. under chinese regulations, however, local lenders aren’t allowed to purchase convertible bonds overseas or domestically. still, the story helped send bear stearns shares more than 3% higher, to a record today, they closed up 1.5%. new york democratic senator charles schumer who raised concerns about the deal to sell terminal operations at american ports to a dubai company said there would be nothing intrinsically wrong with c.c.b. buying a share of bear stearns but members of congress will watch the deal closely. a key issue is reciprocity, he says. will china allow u.s. firms the freedom to function advantageuously in china the way we will allow them to function here. here in washington, washington chief of staff joshua bolten holding his first meeting with senior aides today, telling them to prepare for further changes and that if they’re thinking of leaving in the next year, they should do it now. with his approval ratings at record lows and a host of problem bes, president bush has given bolten the authority to clean house. top jobs that already need filling are a new budget director to replace bolten and new domestic policy to replace clyde allen. bolten is also expected to shake up the relations and economic teams. meanwhile, a bomber blew himself up outside of a central tel aviv restaurant, killing at least eight people and injuring several dozen more. islamic jihad took responsibility for the blast. the hamas government endorsed the attack, calling it a legitimate response to what it calls israel’s aggression. palestinian president mahmoud abbas who heads a rival palestinian party, denounced the bombing. newly elected israeli prime minister ehud olmert is calling for retaliation. a bad day for the former governor of illinois and for jerry fallwell. better news, though, for henry kissinger. a lot of court news in “political notes” coming up.
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