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Iowa Press #2901
September 9, 2001

Borg: IN THE NATION'S CAPITAL, THE 107TH U.S. CONGRESS IS BACK AT WORK, AND THAT WORK INCLUDES SOME HUGE ISSUES. WE'LL GET ASSESSMENTS FROM SENATOR CHARLES GRASSLEY ON THIS EDITION OF "IOWA PRESS."

Narrator: FUNDING FOR "IOWA PRESS" WAS PROVIDED BY FRIENDS OF IOWA PUBLIC TELEVISION; AND BY THE IOWA BANKERS ASSOCIATION... FOR PERSONAL, BUSINESS, AND COMMERCIAL NEEDS, IOWA BANKS HELP IOWANS REACH THEIR FINANCIAL GOALS.

STATEWIDE IOWA PUBLIC TELEVISION IS CELEBRATING THE 30TH ANNIVERSARY OF "IOWA PRESS," NOW SERVING THE STATE AS IOWA'S LONGEST RUNNING PUBLIC AFFAIRS PROGRAM. THIS IS THE SUNDAY, SEPTEMBER 9 EDITION OF "IOWA PRESS." HERE IS DEAN BORG.

Borg: ON TUESDAY THIS PAST WEEK, THE U.S. SENATE RECONVENED. THE HOUSE OF REPRESENTATIVES FOLLOWED A DAY LATER. COMING OFF THEIR 32-DAY SUMMER RECESS, THE 535 MEMBERS OF CONGRESS HAVE SOME SOBERING DECISIONS. THE 2002 BUDGET IS ONE OF THOSE TOUGH DECISIONS. THE BUDGET SURPLUS ALL BUT VANISHED, AND THE FEDERAL GOVERNMENT'S NEW FISCAL YEAR BEGINS IN JUST 21 DAYS. THE HMO REFORM BILL, BETTER KNOWN AS "THE PATIENTS BILL OF RIGHTS", IS ALSO PENDING. IT'S HEADED TO A HOUSE SENATE CONFERENCE COMMITTEE, WHERE DIFFERING VERSIONS PASSED BY THE REPUBLICAN-CONTROLLED HOUSE AND THE DEMOCRATIC-CONTROLLED SENATE MUST BE RECONCILED. AND THE FAITH-BASED INITIATIVE IS EXPECTED TO HAVE A ROCKY ROAD IF AND WHEN IT HITS THE PRESIDENT'S DESK. EDUCATION, SOCIAL SECURITY REFORM, ALSO AWAITING DECISIONS; ALSO AN ENERGY PROPOSAL AND A MOVE BY PRESIDENT BUSH TO DEVELOP AN ANTIMISSILE DEFENSE SYSTEM. AND THERE IS THE NEW FARM BILL TAKING SHAPE. IT WILL REPLACE THE BELEAGUERED "FREEDOM TO FARM ACT OF 1996". ALL OF THAT IN A CONSTRICTED ECONOMIC ENVIRONMENT, WITH THE FEDERAL SURPLUS DRAINED BY TAX CUTS AND AN ECONOMIC SLOWDOWN. WELL, HERE TO HELP US SORT THROUGH THOSE TOUGH CONGRESSIONAL AGENDAS, SENATOR CHARLES GRASSLEY. WELCOME BACK TO "IOWA PRESS."

Grassley: DEAN, I'M GLAD TO BE WITH YOU.

Borg: NICE TO HAVE YOU HERE. AND ACROSS THE TABLE: STATEHOUSE REPORTERS AND POLITICAL REPORTERS DAVID YEPSEN OF "THE DES MOINES REGISTER," AND MIKE GLOVER OF "THE ASSOCIATED PRESS."

Glover: SENATOR, AS DEAN MENTIONED IN HIS OPENING, MOST PROJECTIONS SHOW THE FEDERAL BUDGET SURPLUS IS MORE OR LESS GONE. SHOULD VOTERS ASSUME THAT CONGRESS AND THE PRESIDENT HAVE FRITTERED AWAY WHAT SEEMED AT ONE POINT TO BE BUDGET SURPLUSES FOREVER?

Grassley: LET ME SHOW YOU THAT THE BUDGET SURPLUS IS NOT GONE. JUST LOOK AT HERE... FOR 29 YEARS, FROM 1970 TO 1997, WE HAD DEFICITS ONE YEAR RIGHT AFTER ANOTHER, MORE ACCUMULATING. THE LAST FOUR YEARS, WE HAVE HAD BUDGET SURPLUSES. WE CONTINUE TO HAVE A BUDGET SURPLUS, AND WE SHOW BUDGET SURPLUSES FOR THE NEXT TEN YEARS. AND YOU CAN SEE THAT RIGHT NOW THE YEAR YOU'RE TALKING ABOUT IS THE SECOND LARGEST SURPLUS IN THE HISTORY OF OUR COUNTRY. WE'RE GOING TO PAY DOWN $151 BILLION ON THE NATIONAL DEBT THIS YEAR.

Glover: TO FLIP THAT QUESTION AROUND, THERE ARE SOME WHO ARE SUGGESTING THE ECONOMY IS A LITTLE BIT SOFT; MAYBE THE ECONOMY COULD USE ANOTHER BIT OF A STIMULUS. MAYBE IT'S TIME TO COME IN WITH A CAPITAL GAINS TAX CUT. WHAT DO YOU THINK ABOUT A CAPITAL GAINS TAX CUT?

Grassley: CAPITAL GAINS TAX CUTS ARE GOOD POLICY.

Glover: CAN WE AFFORD THEM NOW?

Grassley: I FAVOR THEM. WE CAN AFFORD THEM BECAUSE THEY WOULD BRING IN MORE REVENUE RIGHT NOW, AND IT WOULD BE QUITE A STIMULUS TO THE ECONOMY. I DON'T THINK IT'S POLITICALLY DOABLE, BUT THERE MAY BE A COMPROMISE THAT WOULD INCLUDE THAT AND TRADE PROMOTION AUTHORITY AND SOME OTHER THINGS THAT COULD BE PUT TOGETHER TO GET THE BIPARTISAN SUPPORT TO GET IT DONE.

Glover: WHAT WOULD THAT COMPROMISE BE?

Grassley: WELL, IT COULD BE TRADE --

Glover: FAST TRACK?

Grassley: IT COULD BE -- YES, TRADE PROMOTION AUTHORITY, FAST TRACK. IT COULD BE THE MINIMUM WAGE INCREASE, COUPLED WITH THE ISSUE OF CAPITAL GAINS, SMALL BUSINESS TAX REDUCTION, SOME MORE MONEY FOR EDUCATION, AND SOME MORE MONEY FOR DEFENSE.

Glover: ARE YOU TALKING TO DEMOCRATS ABOUT THAT?

Grassley: WE ARE BEGINNING TO FLOAT THESE POSSIBLE COMPROMISES.

Yepsen: SENATOR, YOU'RE THE RANKING MEMBER OF THE SENATE FINANCE COMMITTEE. GIVE US YOUR REPORT CARD ON THE CONDITION OF THE ECONOMY. WHAT DO YOU HEAR FROM YOUR CONSTITUENTS, AND WHAT DO YOU HEAR FROM ALL THOSE EXPERTS IN WASHINGTON?

Grassley: WELL, WE'RE HEARING THAT IT WILL BE THE LAST QUARTER OF THIS YEAR BEFORE WE SEE SOME IMPROVEMENT. WE'RE LOOKING AHEAD TO A 2.6-PERCENT GROWTH OVER THE NEXT 12 MONTHS, ABOUT 1.5 PERCENT MORE THAN IT IS RIGHT NOW. WE DO NOT SEE THE COUNTRY IN RECESSION, WHICH WOULD BE TWO QUARTERS OF NEGATIVE GROWTH. WE WOULD ALSO SEE THAT THIS IS A CONTINUATION OF SOMETHING THAT STARTED IN THE MIDDLE OF LAST YEAR AND CONTINUING INTO THE BUSH ADMINISTRATION. HOPEFULLY MOST OF IT HAPPENED LAST YEAR WHEN WE SAW THE NASDAQ LOSE MORE THAN HALF OF ITS GROWTH UNDER CLINTON. WE WOULD HOPE THAT WE'RE BEYOND THAT.

Yepsen: WHAT'S YOUR BIG PRIORITY GOING INTO THE FALL? DEAN TICKED OFF QUITE A LIST OF THINGS, BUT WHAT ARE YOU WORKING ON?

Grassley: WELL, MY BIG PRIORITIES ARE AFFORDABLE PRESCRIPTION DRUGS FOR SENIORS, CONNECTED WITH MODERNIZATION, STRENGTHENING OF MEDICARE; TRADE PROMOTION AUTHORITY FOR THE PRESIDENT OR WHAT HAS ALREADY BEEN REFERRED TO AS FAST TRACK TRADE, TRADING AUTHORITY FOR HIM TO NEGOTIATE; THIRDLY, SMALL BUSINESS TAX REDUCTION COUPLED WITH MINIMUM WAGE AND, HOPEFULLY, WORKING ON A COMMODITY TITLE FOR THE FARM BILL. NOW, IN THAT LAST ONE, I'M WORKING OUTSIDE THE COMMITTEE, BECAUSE THIS IS A FIRST YEAR IN TEN YEARS I HAVE NOT BEEN ON THAT COMMITTEE.

Yepsen: WE'LL GET TO ALL THOSE IN A MINUTE, BUT FIRST I HAVE TO ASK YOU A QUESTION THAT EVERY MEMBER OF CONGRESS IS BEING ASKED THESE DAYS. AND THAT IS, "WHAT SHOULD BE DONE ABOUT GARY CONDIT?"

Grassley: GARY CONDIT IS -- NOTHING. GARY CONDIT IS GOING TO TALK HIMSELF OUT OF A JOB AND, IN FACT, THE RECENT "WASHINGTON POST" SUGGESTED THAT HE WOULD BE NOT RUNNING FOR REELECTION. I THINK HE GOT A VERY, VERY CLEAR MESSAGE, A VERY, VERY SHARP MESSAGE. NOW, MAYBE IOWANS SHOULD SAY THAT I SHOULD HAVE CALLED FOR HIS RESIGNATION, BUT I THINK COMITY BETWEEN THE HOUSE AND SENATE AND MY NOT BEING FROM CALIFORNIA AND THE FACT THAT IT LOOKED LIKE THE ISSUE WOULD TAKE CARE OF ITSELF -- BECAUSE, OBVIOUSLY, WE CAN'T APPROVE OF HIS IMMORAL BEHAVIOR AND, MORE IMPORTANTLY, THE FACT THAT HE DIDN'T LEVEL WITH POLICE IN THE FIRST PLACE.

Borg: SENATOR GRASSLEY, NOW, YOU TICKED OFF SOME PRIORITIES... AMONG THEM, THE FARM BILL. THAT'S IMPORTANT HERE IN IOWA, PARTICULARLY. NUMBER ONE, DO YOU HAVE THE SUPPORT -- GIVEN THE MAKEUP OF CONGRESS, DO YOU HAVE THE SUPPORT IN ORDER TO GET WHAT YOU THINK WE OUGHT TO HAVE IN THAT FARM BILL?

Grassley: ABSOLUTELY. IN OTHER WORDS, IF THE QUESTION IS -- IF THE QUESTION IS BECAUSE THE LAST TIME PEOPLE THOUGHT THAT THE FARM BILL, THIS ONE MIGHT BE THE LAST ONE, I NEVER THOUGHT THAT. AND OBVIOUSLY, THE LAST FOUR YEARS OF LOW PRICES WOULD DICTATE THAT WE NEED A SAFETY NET. WE'RE GOING TO HAVE A FARM BILL. AND I THINK THAT THE COMBINATION OF THINGS THAT HAVE TAKEN TO GET A FARM BILL THROUGH -- FOOD STAMPS, WE'LL SAY, FOR URBAN PEOPLE; FARM PROGRAM FOR FARMERS -- WILL BE A COMBINATION THAT WILL STILL GET US A FARM BILL.

Borg: HOW SHOULD IT DIFFER FROM THE FREEDOM TO FARM ACT OF 1996?

Grassley: TWO THINGS... NUMBER ONE, IT SHOULD HAVE COUNTERCYCLICAL PAYMENTS, SO WE DON'T HAVE TO DEPEND JUST ON CONGRESS VOTING MORE AID FROM YEAR TO YEAR. FARMERS SHOULDN'T HAVE TO BE DEPENDENT UPON THE POLITICAL WILL OF CONGRESS. THERE OUGHT TO BE A PREDICTABLE FORMULA THERE, COUNTERCYCLICAL PROGRAM WOULD DO THAT. SECONDLY, MORE MONEY FOR CONSERVATION. THESE TWO ITEMS ALSO ARE NOT RELATED TO PRODUCTION, BECAUSE IF PROGRAMS ARE RELATED TO PRODUCTION, THEN WE'D BUMP UP AGAINST THE LIMITS PUT ON IN OUR AGREEMENT WITH EUROPE. SO THESE COUNTERCYCLICAL, CONSERVATION, UNRELATED TO PRODUCTION GETS -- SURROUND THOSE LIMITS AND STILL CONTINUE TO HELP THE FAMILY FARMER IN IOWA.

Glover: SENATOR, YOU SAID THAT ONE OF YOUR PRIORITIES IN THIS SESSION IS GOING TO BE PRESCRIPTION DRUG BENEFITS.

Grassley: YES.

Glover: THE PRESIDENT TALKS ABOUT PRESCRIPTION DRUG BENEFITS; DEMOCRATS TALK ABOUT PRESCRIPTION DRUG BENEFITS. EVERYBODY SAYS THEY WANT TO PROVIDE A PRESCRIPTION DRUG BENEFIT. HOW WOULD YOU STRUCTURE THAT BENEFIT? WOULD IT BE A PART OF THE MEDICARE PROGRAM? WOULD IT BE A SUPPLEMENT? HOW WOULD IT WORK?

Grassley: YEAH, IT SHOULD VERY DEFINITELY BE A PART OF THE MEDICARE PROGRAM, FOR THE SIMPLE REASON THAT THE 1965 MODEL OF MEDICARE IS OUTDATED. THE PRACTICE OF MEDICINE THEN WAS TO PUT PEOPLE IN THE HOSPITALS. TODAY THE PRACTICE OF MEDICINE IS TO KEEP PEOPLE OUT OF HOSPITALS. THEN IT WAS -- MEDICINE WAS 1 PERCENT OF THE COST OF MEDICINE; TODAY IT'S 15 PERCENT, SO IT'S JUST ABSOLUTELY ESSENTIAL THAT AN AFFORDABLE PRESCRIPTION DRUG PROGRAM BE PART OF MEDICARE.

Glover: HOW MUCH WILL IT COST?

Grassley: 300 BILLION. NOW, OUR BUDGET RESOLUTION SAYS UP TO 300 BILLION, SO I THINK, AS A PRACTICAL MATTER, IT WILL BE 300 BILLION. AND I THINK IT CAN BE WITHOUT OBLIGATING US TO SOMETHING THAT'S UNAFFORDABLE IN THE FUTURE, AND I WOULD SAY THAT 80 TO 85 PERCENT OF IT WOULD GO FOR PRESCRIPTION DRUGS AND THE OTHER 15 TO 20 PERCENT OF THE 300 BILLION WOULD GO TO IMPROVEMENTS OF MEDICARE THAT WOULD MAKE IT MORE LIKE PRIVATE HEALTH INSURANCE THAT PEOPLE HAVE WHILE THEY'RE WORKING, BECAUSE WE DON'T WANT BABY BOOMERS THAT HAVE BEEN COVERED FOR THE LAST FORTY YEARS WITH A GOOD PROGRAM TO GO INTO A PROGRAM WHERE THERE'S LIMITS ON THE NUMBER OF DAYS IN HOSPITALS, WHERE THERE'S INDESCRIBABLE COMPLICATION OF COPAYMENTS AND DEDUCTABLES. WE CAN MAKE THESE THINGS SO THAT THERE'S MORE CATASTROPHIC PROTECTION IN MEDICARE.

Yepsen: AND ALL THIS TALK OF DECLINING REVENUES, WHETHER IT'S BECAUSE OF TAX CUTS OR DECLINING ECONOMY -- YOU SHOWED IT ON YOUR CHART. ALL THAT TALK, THERE'S STILL MONEY GOING TO BE THERE FOR PRESCRIPTION DRUG BENEFITS?

Grassley: BECAUSE WE HAVE 300 BILLION IN OUR BUDGET, SO THERE'S NOT A POINT OF ORDER THAT CAN BE RAISED AGAINST IT. AND ALSO, DON'T FORGET THAT EVEN THE PRESIDENT HAS COME UP WITH A FIGURE OF AT LEAST 190 BILLION FOR PRESCRIPTION DRUGS.

Yepsen: HOW SOON WILL THE SENIOR CITIZEN IN IOWA START TO SEE THAT BENEFIT?

Grassley: IF CONGRESS PASSES THE BILL IN OCTOBER, IT WOULD BE A YEAR AND A HALF TO TWO YEARS AFTER THAT BEFORE THEY'D SEE THE BENEFIT OF IT.

Yepsen: AND WHAT ABOUT A "PATIENTS BILL OF RIGHTS"? DEAN MENTIONED THAT AS SOMETHING THAT'S -- YOU KNOW, PEOPLE ARE AT LOGGERHEADS. WHAT'S THE PROSPECT FOR THAT?

Grassley: I WANT TO BE CLEAR THAT IT WOULD BE JUST THE NEW PRESCRIPTION DRUG PROGRAM THAT WOULD TAKE A YEAR TO A YEAR AND A HALF TO KICK IN. THE IMPROVEMENTS THAT I TALKED ABOUT IN MEDICARE AND THE STRENGTHENING OF MEDICARE COULD BE KICKED IN ALMOST IMMEDIATELY. BEYOND THE -- "THE PATIENTS BILL OF RIGHTS" WAS YOUR NEXT QUESTION? IT WILL PROBABLY PASS YET THIS OCTOBER OR BEFORE WE ADJOURN IN NOVEMBER.

Glover: ANOTHER PRIORITY THE PRESIDENT HAS PROPOSED IS AN INCREASE IN EDUCATION SPENDING. IS THAT GOING TO PASS?

Grassley: YES. IT WILL PROBABLY BE AT A LEVEL CLOSER TO WHAT THE HOUSE OF REPRESENTATIVES HAS PASSED.

Glover: HOW MUCH WOULD THAT BE?

Grassley: THAT WOULD BE ABOUT $4 BILLION ABOVE WHAT THE PRESIDENT HAS SUGGESTED. THE PRESIDENT HAD AN 11-PERCENT INCREASE. I THINK THE HOUSE IS 4 BILLION ABOVE THAT, WHEREAS, THE SENATE IS MUCH HIGHER THAN THAT. I DON'T KNOW THE EXACT FIGURE.

Glover: 300 BILLION FOR MEDICARE; 10 BILLON OR SO FOR EDUCATION. IS THIS CONGRESS GOING TO BE A BIG SPENDING CONGRESS?

Grassley: NO. COMPARED TO THE 6, 7, AND 8 PERCENT OF EACH OF THE LAST THREE YEARS, WHICH IS A NONSUSTAINABLE LEVEL OF EXPENDITURE, THIS ONE WILL BE IN THE AREA OF 4-PERCENT TO 5-PERCENT INCREASE.

Glover: ISN'T THAT DOUBLE INFLATION?

Grassley: IT'S DOUBLE INFLATION BUT IT'S SOMETHING THAT'S SUSTAINABLE OVER THE LONG HAUL, AND IT'S SOMETHING THAT BOTH THE PRESIDENT AND THE CONGRESS CAN LIVE WITH AND WE CAN ACCOUNT FOR INFLATION AND ACCOUNT FOR THE INCREASE ENROLLMENTS THAT WE'RE GOING TO HAVE IN SOME OF THESE PROGRAMS BECAUSE OF THE POPULATION BECOMING MORE ELDERLY. ALSO LET ME SUGGEST THAT SOME BELT TIGHTENING IS PERFECTLY LEGITIMATE. NOW, WE ALWAYS LOOK AT THIS REDUCTION OF REVENUE COMING IN, WHICH IS STILL $151-BILLION SURPLUS, AS SOMETHING BAD. ACTUALLY, SOME BELT TIGHTENING BY THE FEDERAL GOVERNMENT AND SOME HEAT PUT ON TO DO THAT IS A GOOD THING FOR THE TAXPAYERS AND A GOOD THING FOR THE EFFICIENCY IN GOVERNMENT.

Yepsen: ANOTHER SPENDING ISSUE BEFORE THE CONGRESS IS MILITARY SPENDING. SHOULD WE BUILD THE ANTIMISSILE SYSTEM OR NOT?

Grassley: WE SHOULD BUILD THE ANTIMISSILE SYSTEM, BUT HERE'S ONE THING THAT YOU WANT TO CONSIDER. THE PRESIDENT IS PROPOSING AN $18-BILLION INCREASE IN DEFENSE EXPENDITURES. THAT PROBABLY WON'T FLY AT THAT LEVEL. THERE WILL BE SOME INCREASE, BUT HERE'S TWO VERSIONS JUST IN THE PLAYING OUT HERE. I SAT BESIDE A MARINE CORPS COLONEL. HE SAID TO ME, HE SAID, "THE PROBLEM WITH THE PENTAGON IS THEY'VE GOT TOO MUCH MONEY TO SPEND." THEN I HEARD SENATOR STEVENS IN A EUROPEAN MEETING IN BERLIN IN AUGUST. HE SAID THAT EUROPE WAS CONFESSING TO HIM THAT THEY'RE AT THE LOWEST LEVEL OF THEIR DEFENSE EXPENDITURE SINCE WORLD WAR II, AND THEY'RE REALLY DEPENDING ON THE UNITED STATES -- OR LET'S PUT IT THIS WAY... THE WORLD DEPENDS ON THE UNITED STATES FOR THE MAINTENANCE OF PEACE. NOW, WHAT THE POINT IS, WE'VE GOT TO SPEND ENOUGH MONEY ON DEFENSE TO MEET OUR DEFENSE NEEDS, BUT WE SHOULDN'T SPEND ONE PENNY MORE.

Glover: THE PRESIDENT OF MEXICO WAS JUST HERE VISITING WITH THE PRESIDENT, TALKING ABOUT IMMIGRATION ISSUES. HE SUGGESTED THAT WITHIN A YEAR, THERE OUGHT TO BE A NEW IMMIGRATION POLICY THAT WOULD IN EFFECT GRANT REGULAR STATUS TO ILLEGAL ALIENS ALREADY IN THIS COUNTRY. IS THAT A GOOD IDEA?

Grassley: I DIDN'T HEAR -- I HEARD HIS SPEECH IN THE HOUSE OF REPRESENTATIVES. I WAS THERE. I DIDN'T HEAR HIM USE THE WORD AMNESTY. IF HE'S TALKING ABOUT REGULARIZATION OF PEOPLE TO BE IN THIS COUNTRY LEGALLY, THAT'S ONE THING. IF HE'S TALKING ABOUT AMNESTY, WE CAN'T HAVE AMNESTY BECAUSE IF WE ALLOW PEOPLE WHO HAVE COME TO THIS COUNTRY ILLEGALLY, IT DENIGRATES THE VALUE OF LEGAL IMMIGRATION INTO THE UNITED STATES AND MAKES PEOPLE IN OTHER COUNTRIES WHO STAND IN LINE FOR MONTHS AND YEARS TO GET INTO THIS COUNTRY LEGALLY, IT DEVALUES THEIR ROLE. AND ONE OF THE THINGS WE WANT TO -- WE WANT TO WELCOME NEW CITIZENS, AND WE WANT TO WELCOME NEW IOWANS, TOO. BUT THE POINT IS WE WANT PEOPLE IN IOWA AND THE UNITED STATES TO COME HERE WHO HAVE RESPECT FOR LAW, AND THAT INCLUDES OUR IMMIGRATION LAWS.

Glover: ISN'T THAT JUST PUTTING A DIFFERENT LABEL ON THE SAME THING AND, IN FACT, YOU'RE TAKING PEOPLE WHO ARE HERE AND LETTING THEM STAY?

Grassley: ABSOLUTELY NOT, BECAUSE, FOR INSTANCE, PEOPLE WHO ARE HERE ILLEGALLY, THEY DON'T HAVE ANY RIGHT TO BE HERE. BUT PEOPLE WHO COME HERE UNDER EXPANDING PROGRAMS LIKE WE HAVE FOR HIGH-TECH EMPLOYEES, THEY'RE HERE LEGALLY. PEOPLE THAT COME WITH GREEN CARDS, THEY'RE HERE LEGALLY. PEOPLE THAT COME HERE UNDER THE GUEST WORKER PROGRAM... WE CAN HAVE A VERY EXPANDED GUEST WORKER PROGRAM. THOSE PEOPLE WOULD BE COMING LEGALLY AND THEY'D BE COMING BECAUSE WE HAVE JOBS FOR THEM AND NOT JUST BECAUSE THEY COME HERE IN THE HOPE OF GETTING A JOB.

Glover: BUT NO ONE WHO'S HERE ILLEGALLY WOULD BE GRANTED LEGAL ALIEN STATUS UNDER YOUR VIEW?

Grassley: NOT UNDER MY VIEW, ABSOLUTELY NOT.

Yepsen: SENATOR, I WANT TO GO BACK TO SENIOR CITIZENS FOR A MOMENT. SOCIAL SECURITY, WILL THIS CONGRESS DO SOMETHING TO MAKE SOCIAL SECURITY SOUND FOR BABY BOOMERS AND "GEN X'ERS", OR IS THIS JUST ONE OF THOSE ISSUES THAT'S TOO PARTISAN AND YOU'RE GOING TO HAVE TO PUNT DOWN THE ROAD?

Grassley: WELL, FOR ME IT'S PRETTY IMPORTANT, BECAUSE I MENTIONED PRESCRIPTION DRUGS FOR SENIORS PLUS MEDICARE, I MENTIONED TRADE PROMOTION AUTHORITY FOR THE PRESIDENT. I DIDN'T MENTION WELFARE, BUT WE'VE GOT TO REAUTHORIZE THE WELFARE ACT THAT'S BEEN SO SUCCESSFUL. AND FOURTHLY, SOCIAL SECURITY. AND THE REASON WHY WE MUST DO IT IS WE'VE GOT A VERY GOOD SOCIAL SECURITY PROGRAM FOR PEOPLE THAT ARE 55 YEARS AND OLDER. BUT IF YOU'RE A 30 YEAR OLD, YOU ARE NOT GOING TO GET OUT OF SOCIAL SECURITY WHAT YOU PAID FOR IT. THAT'S NOT TRUE OF ANYBODY 55 AND OLDER. IF THEY LIVE THE AVERAGE AGE, THEY'RE GOING TO GET A LOT MORE OUT THAN THEY PAY IN. AND I OUGHT TO BE ABLE TO LOOK ANY SENIOR CITIZEN IN THE FACE AND SAY, "DON'T YOU THINK THAT SOMEBODY THAT'S 30 YEARS OLD OUGHT TO BE ENTITLED TO AS GOOD OF A RETIREMENT SYSTEM UNDER SOCIAL SECURITY AS WHAT YOU HAVE, AND IF WE DON'T IMPROVE IT AND STRENGTHEN IT, THAT WON'T BE POSSIBLE FOR THE 30 YEARS OLD?" AND THAT'S WHAT WE'RE GOING TO ATTEMPT TO DO. NOW, YOU ASK "IS IT TOO POLITICAL TO ACCOMPLISH." MAYBE FOR SOME PEOPLE. BUT I HOPE IT ISN'T FOR MOST OF THE PEOPLE.

Yepsen: WELL THE NUB OF THE ISSUE IS WHETHER THOSE 30 YEAR OLDS OUGHT TO BE ALLOWED TO INVEST PART OF THEIR SOCIAL SECURITY CONTRIBUTION IN THE STOCK MARKET. HOW DO YOU FEEL ABOUT THAT?

Grassley: THEY SHOULD BE ALLOWED TO HAVE PERSONAL ACCOUNTS. THEY WOULD MAKE THE CHOICE IF ITS MONEY MARKET FUNDS, TREASURY BILLS, BONDS, OR STOCKS. BUT REMEMBER, WE'RE ONLY TALKING ABOUT 1.5 TO 2 PERCENT OF THE 10 POINTS THAT ARE PAID IN FOR SOCIAL SECURITY. WE'RE NOT TALKING ABOUT MUCH OF THE TOTAL RESOURCE. WE'RE GOING TO STILL HAVE A SOCIAL SECURITY SYSTEM THAT'S RUN FOR THE GOVERNMENT THAT'S GOING TO GUARANTEE PEOPLE A MINIMUM INCOME, AND IT'S GOING TO BE PROTECTED. BUT WE'RE ALSO GOING TO GIVE YOUNGER PEOPLE AN OPPORTUNITY TO HAVE THE SAME RETIREMENT THAT SENIORS TODAY HAVE.

Yepsen: THERE'S A STORY OUT THIS WEEKEND THAT THE BUSH ADMINISTRATION IS CONSIDERING CHANGING THE WAY IT INSPECTS NURSING HOMES. IS THAT CORRECT AND DO YOU SUPPORT CHANGING THE WAY THE FEDERAL GOVERNMENT LOOKS AFTER NURSING HOMES?

Grassley: WE HAVE A 1987 LAW THAT'S IN PLACE. WHEN I WAS CHAIRMAN OF THE AGING COMMITTEE, I HELD HEARINGS AFTER HEARINGS AND ENFORCEMENT AFTER ENFORCEMENT INITIATIVE ON MY PART TO MAKE SURE THAT OUR NURSING HOMES WERE NO LONGER GOING TO BE SNAKE PITS. WE ARE NOT OVER THAT HURDLE YET, AND I EXPECT THE LAW TO BE ENFORCED. NOW, I HAVE, IN A LETTER I SENT IN AUGUST, COMPLAINED TO THE NEWS REPORTS OF THE DIRECTOR OF THE HEALTH CARE FINANCING ADMINISTRATION THAT WHAT I HEARD HIM SAY, I WAS NOT GOING TO STAND FOR IT. HE WROTE BACK AND SAID HE DID NOT INTEND THAT AT ALL AND HE MEANT THAT HE WOULD WORK WITH ME ON ANY CHANGES HE'S GOING TO MAKE. AND WORKING WITH ME DOESN'T MEAN THAT WHEN HE'S THOUGHT OF WHAT HE'S GOING TO DO HE'S JUST GOING TO GIVE ME A HEADS UP ON IT, BECAUSE I'M NOT GOING TO ALLOW SNAKE PITS ANYMORE LIKE WE SAW IN CALIFORNIA.

Glover: IS IT YOUR BELIEF THAT THIS ADMINISTRATION WANTS TO EASE REGULATION OF NURSING HOMES, AND WILL YOU ALLOW IT?

Grassley: IT'S MY BELIEF THAT THEY ARE LOOKING AT A BETTER, MORE EFFICIENT WAY TO DO IT. AND I'M WILLING TO LOOK AT NEW WAYS OF DOING IT, BUT THE LAW IS NOT GOING TO CHANGE AND THEY'RE GOING TO BE WITHIN THE LAW. AND ONE THING THAT I'M VERY SERIOUS ABOUT IS THAT WE'RE NOT GOING TO ALLOW DATA THAT IS COLLECTED BY THE INDUSTRY ITSELF TO BE THE DETERMINATION OF WHETHER OR NOT THERE OUGHT TO BE MORE INSPECTION OR LESS INSPECTION. I DO NOT TRUST DATA THAT IS PUT FORTH BY THE INDUSTRY.

Glover: ANOTHER ISSUE THAT YOU'RE INVOLVED IN IS THE JUSTICE DEPARTMENT, WHICH HAS BEEN ACTING TO GET THE TELEPHONE RECORDS OF SOME REPORTERS IN WASHINGTON. WHAT'S YOUR VIEW OF WHAT THEY'RE DOING THERE?

Grassley: IT'S WRONG.

Glover: WHY DID THEY DO IT?

Grassley: I THINK THAT IT WAS KIND OF A STUPID MOVE BY SOME PEOPLE. WHY, I DON'T KNOW. BUT THEY DID NOT EVEN FOLLOW THEIR OWN REGULATIONS. NOW, I'M NOT MAKING A JUDGMENT RIGHT NOW IF IT'S TOTALLY WRONG, BUT I FEEL THAT IT IS. AND I KNOW THAT IT'S THE JUDGMENT OF SOME LEADING PEOPLE IN THE PRESS INDUSTRY THAT IT'S WRONG. AND I'M GOING TO ASK FOR THE DOCUMENTS AND MAKE A FINAL DETERMINATION. BUT WHAT I KNOW NOW, THEY DID NOT EXHAUST ALL REMEDIES BEFORE SECURE -- ASKING FOR A SUBPOENA OF THE TELEPHONE RECORDS, AND THEY DID NOT NEGOTIATE WITH THE NEWS ORGANIZATION TO GET IT BEFORE THEY ISSUED THE SUBPOENA. AND THESE ARE TWO REQUIREMENTS OF THEIR REGULATIONS, AND ALL I'M SAYING IS THAT THE JUSTICE DEPARTMENT OUGHT TO FOLLOW THEIR OWN REGULATIONS. THOSE REGULATIONS ARE THERE BECAUSE OF ABUSE BACK DURING THE WATERGATE YEARS OF NIXON.

Glover: AND FOR THE INTEREST OF FULL DISCLOSURE, THE NEWS ORGANIZATION WAS THE "A.P.", WHICH WOULD HAVE HAD A CHANCE TO DEFEND ITSELF, HAD THEY BEEN ENTERED INTO NEGOTIATIONS WITH, RIGHT?

Grassley: YES, ABSOLUTELY.

Yepsen: SENATOR, IT WOULDN'T BE AN OFFICIAL "IOWA PRESS" SHOW IF WE DIDN'T TALK POLITICS. WE'VE GOT A BIG U.S. SENATE RACE IN THIS STATE COMING UP NEXT YEAR, PROBABLY BETWEEN GREG GANSKE AND SENATOR HARKIN. WHAT'S YOUR ROLE IN THAT CAMPAIGN GOING TO BE? YOU DID A FLY-AROUND WITH CONGRESSMAN GANSKE HERE A WHILE BACK. WHAT'S YOUR ROLE IN THAT CAMPAIGN?

Grassley: PROBABLY THE SAME ROLE THAT I WOULD HAVE FOR A CANDIDATE FOR THE LEGISLATURE, FOR GOVERNOR, FOR ANYTHING ELSE: TO BE SUPPORTIVE, TO HELP RAISE MONEY, TO MAKE APPEARANCES, TO BE SURROGATES, TO BE FOR THE CANDIDATE. I INTEND TO RESPECT SENATORIAL COURTESY OR COMITY, WHATEVER YOU WANT TO CALL IT. I WILL NOT BE CAMPAIGNING AGAINST SENATOR HARKIN, BUT I VERY MUCH WILL BE SUPPORTIVE OF THE REPUBLICAN CANDIDATE FOR THE SENATE.

Yepsen: DOES SENATOR HARKIN UNDERSTAND THAT? IS YOUR WORK FOR GREG GANSKE GOING TO GET IN THE WAY OF YOUR WORKING WITH SENATOR HARKIN ON ISSUES IMPORTANT TO YOU.

Grassley: WHAT I JUST DESCRIBED TO YOU IN MY WAY OF SUPPORTING A REPUBLICAN CANDIDATE FOR THE UNITED STATES SENATE ISN'T ANYTHING DIFFERENT THAN I DID IN 1990 AND 1996. AND CONSEQUENTLY, IT NEVER GOT IN THE WAY OF OUR WORKING TOGETHER AT THAT PARTICULAR TIME AND WOULDN'T EXPECT TO GET IN OUR WAY THIS TIME.

Glover: ALSO ON THE BALLOT NEXT YEAR IS A PRETTY BIG RACE FOR GOVERNOR. YOU HAVE AN INCUMBENT DEMOCRATIC GOVERNOR FOR THE FIRST TIME IN A LONG TIME AND A COUPLE OF REPUBLICANS WHO ARE FAR LESSER KNOWN RUNNING AGAINST HIM. WHAT'S YOUR ROLE IN THAT RACE? SHOULD YOU BE SEEKING OUT BETTER KNOWN CANDIDATES? SHOULD YOU BE TELLING THE REPUBLICAN PARTY, "LOOK, THESE ARE OUR CANDIDATES; LET'S GET BEHIND THEM"? WHAT ROLE SHOULD YOU PLAY IN THAT?

Grassley: I'M GOING TO NOT CHOOSE SIDES IN THAT PRIMARY. I WILL BE SUPPORTIVE OF THE REPUBLICAN CANDIDATE IN THE SAME WAY THAT I DESCRIBED THAT I WOULD SUPPORT THE REPUBLICAN CANDIDATE FOR THE SENATE AGAINST SENATOR HARKIN. AND I THINK THAT I HAVE A RESPONSIBILITY TO MAKE SURE THAT WE HAVE THE RESOURCES, THAT WE DON'T HAVE TOO MUCH -- THAT WE DON'T HAVE ANY NAME-CALLING AND INFIGHTING THAT'S GOING TO DIVIDE OUR PARTY.

Glover: A LOT OF REPUBLICAN PARTY LEADERS ARE RUNNING AROUND TRYING TO FIND A CANDIDATE WHO IS BETTER KNOWN. IS THAT A GOOD IDEA?

Grassley: I WOULD NOT SECOND GUESS WHAT REPUBLICAN LEADERS IN IOWA FEEL THEY OUGHT TO DO FOR PARTICULAR CANDIDATES, BECAUSE I DON'T HAVE TIME TO DO RECRUITING., SO I'M GOING TO RELY ON THEIR JUDGMENT ON THAT.

Glover: DO YOU THINK ONE OF THESE TWO CANDIDATES CAN BEAT TOM VILSACK?

Grassley: I BELIEVE WITH THE BUDGET SITUATION THE WAY IT IS AND IF THE REPUBLICAN LEGISLATORS HANDLE THE NEXT SESSION OF THE FISCAL MATTERS WELL THAT HE COULD BE VULNERABLE, YES.

Yepsen: WELL, HOW IS IT THAT YOU BEAT TOM HARKIN? GIVEN -- CONGRESSMAN GANSKE IS BEHIND SENATOR HARKIN, ANYWHERE 10 TO 15 POINTS. WHAT'S THE SCENARIO THERE FOR TAKING OUT SENATOR HARKIN?

Grassley: I WOULD SUGGEST THAT IF HE'S ONLY 10 OR 15 POINTS BEHIND AT THIS STAGE OF THE GAME, HE'S IN A PRETTY STRONG POSITION TO BE A STRONG CHALLENGER. SECONDLY, I THINK THAT CONGRESSMAN GANSKE WILL HAVE THE ABILITY TO MATCH SENATOR HARKIN IN THE FUNDS. NO REPUBLICAN CANDIDATE HAS DONE THAT BEFORE. GREG GANSKE HAS SHOWN THE ABILITY TO WORK HARD, TO DEFEAT LONG-TIME INCUMBENTS AS HE PREVIOUSLY FOR CONGRESS. AND SECONDLY, HE CARRIES POLK COUNTY.

Yepsen: ISN'T IT GOING TO BE AWFULLY DIFFICULT FOR REPUBLICANS TO RECAPTURE CONTROL OF THE U.S. SENATE? YOU'VE HAD A NUMBER OF INCUMBENT REPUBLICAN SENATORS SAY THEY'RE GOING TO RETIRE OR DO SOMETHING, RUN FOR SOME OTHER OFFICE. YOU'VE GOT MORE REPUBLICANS UP FOR REELECTION THAN THERE ARE DEMOCRATS. SO ISN'T IT GOING TO BE TOUGH FOR YOU TO BE CHAIRMAN OF THE FINANCE COMMITTEE AGAIN?

Grassley: NO. YOU'RE LOOKING TOO MUCH AT THE ARGUMENTS USED BY THE DEMOCRATIC SENATORIAL CAMPAIGN COMMITTEE. NUMBER ONE, THE THREE STATES WHERE WE HAVE VACANCIES, THESE ARE THREE STATES THAT WE CAN EASILY CARRY, WITH ELIZABETH DOLE, LINDSAY GRAHAM, AND EITHER BONILLA OR BARTON IN TEXAS. FIFTEEN OF THE TWENTY REPUBLICANS THAT ARE UP FOR ELECTION ARE IN STATES WHERE BUSH CARRIED BY FIVE OR MORE POINTS. AND 11 OF THOSE ARE IN STATES WHERE HE CARRIED BY 15 OR MORE POINTS, AND WE ONLY HAVE ONE CANDIDATE UP FOR ELECTION THAT'S IN A STATE THAT GORE CARRIED BY MORE THAN 5 POINTS.

Yepsen: BUT IT'S AN OFF-YEAR, SENATOR. THE ECONOMY IS BAD. AREN'T THOSE TWO THINGS GOING TO MAKE IT MORE DIFFICULT FOR YOU TO GET THOSE ONE OR TWO ADDITIONAL SEATS BEYOND THOSE? IT'S -- IF YOU LOOK AT THE VULNERABILITY OF DEMOCRATIC CANDIDATES IN MONTANA, SOUTH DAKOTA, IOWA, AND MINNESOTA, I DON'T THINK IT'S DIFFICULT AT ALL TO PICK UP ONE OR TWO SEATS.

Glover: ANOTHER STATE WE'D LIKE TO TALK ABOUT IS IOWA, WHERE THE PRESIDENT LOST NARROWLY. IS HE OKAY HERE? HE'S BEEN BACK HERE THREE TIMES SINCE THE ELECTION. IS HE PUTTING HIMSELF IN A POSITION TO CARRY THIS STATE NEXT TIME?

Grassley: HE IS DOING THE THINGS THAT NEED TO BE DONE BETWEEN NOW AND 2004 TO CARRY THIS STATE. HAS HE DONE ENOUGH? NO.

Glover: WHAT ELSE DOES HE NEED TO DO?

Grassley: WELL, HE NEEDS TO CONTINUE TO PAY ATTENTION TO IOWA, AS HE HAS FOR THE LAST EIGHT MONTHS, BEING HERE THREE TIMES. IF HE CONTINUES THAT, I THINK THAT HE IS GOING TO BE IN A GOOD POSITION.

Glover: IS THERE ANY CHANCE OF A CHALLENGE FROM WITHIN THE REPUBLICAN PARTY, OR IS THAT PRETTY MUCH PRECLUDED?

Grassley: RIGHT NOW, PRECLUDED.

Glover: WHAT COULD SPARK THAT?

Grassley: WHAT COULD SPARK IT WOULD BE PRESIDENT BUSH COMPROMISING ON THE BASIC PRINCIPLES THAT LED TO HIS VICTORY IN THE FIRST PLACE.

Borg: THANK YOU, SENATOR. IT'S GOOD HAVING YOU HERE TODAY. ON OUR NEXT EDITION OF "IOWA PRESS," THE FOCUS IS ON STATE PARTY POLITICS. JOINING US NEXT WEEK, STATE REPRESENTATIVE CHUCK LARSON OF CEDAR RAPIDS, WHO IS CHAIR OF THE REPUBLICAN PARTY OF IOWA, AS WELL. THAT'S NEXT SUNDAY AT NOON AND 7:00. AND AS WE SAID AT THE BEGINNING OF TODAY'S PROGRAM, "IOWA PRESS" IS NOW BEGINNING ITS 31ST SEASON HERE ON IOWA PUBLIC TELEVISION. IT'S BEEN AN INTERESTING 30 YEARS FOR ALL OF US ASSOCIATED WITH THIS WEEKLY NEWS-INTERVIEW PROGRAM, AND I HOPE THAT INCLUDES YOU TOO. OUR THANKS GOES TO YOU, INCIDENTALLY, OUR WEEKLY VIEWERS, FOR MAKING "IOWA PRESS" A VERY REWARDING EXPERIENCE FOR US ALL. AND WE CLOSE TODAY'S EDITION WITH A SNAPSHOT FROM OUR PAST.

Carter: I THINK TO BE DISASSOCIATED WITH THE HORRIBLE BUREAUCRATIC MESS THAT EXISTS IN WASHINGTON RIGHT NOW IS A POLITICAL ADVANTAGE. I THINK TO HAVE HAD A BROAD RANGE OF EXPERIENCE PROFESSIONALLY IS AN ADVANTAGE. I'M A FARMER. I'M A FULL-TIME FARMER. I'VE BEEN AN ENGINEER. I'VE BEEN A PLANTER. I'VE BEEN A SCIENTIST. I'M FAMILIAR WITH THE ENERGY PROBLEMS OF THE NATION. I'VE HAD EXECUTIVE LEADERSHIP EXPERIENCE IN THE GOVERNOR'S OFFICE FOR FOUR YEARS. I SERVED IN THE GEORGIA SENATE FOR FOUR YEARS BEFORE THAT. I'VE BEEN ON THE LOCAL SCHOOL BOARD FOR SEVEN YEARS. SO I KNOW THE DIFFICULTY OF ADMINISTERING THE CONGLOMERATION OF PROGRAMS THAT HAVE BEEN FOSTERED ON THE AMERICAN PEOPLE OUT OF WASHINGTON FOR THE LAST HUNDRED YEARS, NONE OF WHICH HAS EVER BEEN CANCELED, BUT STILL WE'RE TRYING TO ADMINISTER THEM AT THE LOCAL AND STATE GOVERNMENT LEVEL. SO I'M FAMILIAR WITH THE PROBLEMS OF THE NATION, AND I THINK THAT A TOUGH EXECUTIVE MANAGER OF THE GOVERNMENT, A BUSINESSMAN, AND A FORMER GOVERNOR WOULD BE VERY EFFECTIVE. THE THING ABOUT BEING OUT OF OFFICE, I THINK, IS ALSO AN ADVANTAGE, BECAUSE IT GIVES ME A CHANCE TO BE A FULL-TIME CANDIDATE.

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