Samuel Skinner Oral History

This is the interview with Samuel Skinner for the Bush 41 Oral History Project. Sam and Russell and I have gone over some of the details of the interview, and also the disposition of the interview records, and we discussed a little bit the sensitive points that pertain in a lot of these interviews where people want to tell the story, but they have to use some care in how that story is interpreted and how it gets out. So we understand that, but we do hope that you'll tell it like it was in the confidence that you can embargo anything or put time restrictions on the release, because the ultimate audience is people not yet born, and they ought to know what the story was, even through it could not fully be told in the lifetime.

Would you like to begin at the beginning and take us through your association with the Bush administration?

Why don't I tell you how I met President Bush, what our relationship was before he became President, what it was afterwards, and what it is today?

You've seen some of my background. I graduated from the University of Illinois in 1960 and went into the Army. Then I went to work for the IBM Corporation, where I was a computer salesman for eight years. I was attending law school at the same time. I'd gone to the University of Illinois in pre-law and changed to accounting when I started getting good grades in accounting. After I got out of the Army, I went back to law school at DePaul. I'd been taking my legal education at night while I was selling computers for IBM in the daytime.

In 1966, as I was nearing graduation from law school, one of my classmates suggested that I go into the United States Attorney's office to get some experience, if I was going to leave IBM--although nobody knew why I would want to leave IBM. I really wanted to practice law, so I applied to the U.S. Attorney's office in 1966. But I was unable to get a job. They didn't kill my application. They just kind of kept it alive and didn't do anything about it.

I went out in 1968 to interview for a job in the legal department at IBM. After I turned it down, I indicated to Burke Marshall, the General Counsel of IBM who had been the Assistant Attorney General for Civil Rights in the [John F.] Kennedy Administration, that I was interested in going into government. He called Warren Christopher, who was then the Deputy Attorney General in the [Lyndon B.] Johnson administration, and he wrote a letter to the U.S. Attorney, so I was hired. I began there in '68, but I was not involved in politics at all. I'd worked in a precinct for a short period of time before '68 when I was hired in the U.S. Attorney's office. But that office was in Chicago. It had about 32 lawyers. Shortly after that, two individuals came into the office as the United States Attorney, a judge named Bill Bauer. Jim Thompson came in as his first assistant. He later went on to become a 14-year Governor of Illinois.

This has nothing to do with the Bush Presidency, but I'll share it with you because it's interesting. The first case I was assigned to was the Chicago Seven case. I was the book carrier in the trial before Judge [Julius] Hoffman of those people who had been prosecuted as a result of the '68 convention in Chicago. In fact, the first day I went into the office, I was waiting to sign in my papers. The assistant U.S. attorneys were coming through, and I heard them talking. They wanted to know if the government was going to pay for their cleaning. I wondered what that was all about. It turns out that they had been on the street and had gotten their suits all bloody from the '68 convention. They wanted to know who was going to pay the cleaning bill.

I was the book carrier in that case, off and on, in the courtroom some, and doing research.

What does that mean, "book carrier"?

I was just the researcher. When you're a trial lawyer and you're carrying books, it's not the same as asking questions. We tried that case, and I tried a number of other cases. Then Jim Thompson came in as U.S. Attorney, and I became his first assistant. We took that office from 32 lawyers to over a hundred. It was during the [Richard M.] Nixon years. I was the chief prosecutor on the case of Governor Otto Kerner, who had been formerly a United States Circuit Judge and was a United States Circuit Judge when we tried him for his misconduct as Governor. That's the only United States Circuit Judge in the history of our nation who has been prosecuted and convicted. That took a lot of our time. I became very close to Jim Thompson because he tried that case with me as U.S. Attorney. We tried that case together.

He had had a very great interest in going into politics from day one. I had no interest in going into politics. I just wanted to try cases and be in law enforcement. So in 1975, he left to become Governor, and I took his place as U.S. Attorney in Chicago. I continued to prosecute and was not involved in cases at all. In 1977, I left the U.S. Attorney's office because in November of 1976, Jimmy Carter had been elected President. While a number of Democrats urged my retention, I was replaced as U.S. Attorney in June of 1977. I left July 1, 1977, and went into private practice at a law firm in Chicago.

Then Governor Thompson started to get me involved in projects for him. I headed up the commission to look at public aid in the state of Illinois and what we could do about the issues there. I was involved in a number of other issues, and sometime in December--or between November and January of 1980--I was invited to a dinner. Governor Thompson was having all the presidential candidates come to Springfield to have dinner at the mansion. He invited me to most of these, and I went to several of them. At one of those was George Herbert Walker Bush, now known as "41." He was at the dinner, and I was at a table with Jim Baker, who was working with him. He was a candidate in 1980.

Governor Thompson and the Republicans in Illinois that year were supporting John Connally, which fell flat. But I was uncommitted. So I was asked by Jim Baker about a week later if I would help them in the 1980 Bush campaign in Illinois. They had a chairman, but it wasn't going very well. They wanted to beef it up a little bit, and I'm sure they wanted someone associated with Thompson. I had not committed to Connally, which is interesting--and I've never thought about it until this moment--I have no idea why I didn't commit to Connally like everybody else did. Maybe it was because he was a Democrat and I was a Republican, I don't know. But the reason I got to know President Bush was that I was uncommitted. Even though one of my best friends was committed to another candidate, I had stayed on the sidelines. As a result of that, I was still open and available for Jim Baker to recruit me to work with them in the campaign for Herbert Walker Bush in '80. We lost Illinois in '80, but then he went on to become Vice President.

You lost in the general election?

We lost in the primary in Illinois. I think [Ronald] Reagan won Illinois. George Bush went on and won Michigan, and kept his campaign alive. We have a March primary, but I went on the sidelines a little bit. In August he was nominated to be Vice President. I guess there's a whole story on that that you've probably heard.

Were you there?

I was not there. Dick Allen has the most vivid recollection of how it happened. I have no idea whether it's accurate. I do not know. He never discussed it with me, and I'm not so sure he knew.

But they started calling me, asking me to help. So when President Bush came to the state as the vice presidential candidate, I visited with him, and I went on the trips. I was his informal contact in the state during 1980. I had been asked indirectly by the Reagan people to head--at that time, you could have an independent funding source for campaigns, if you weren't involved with the campaign. I turned it down and stayed active in the campaign, helping Bush as best I could as vice presidential candidate. From 1980 to 1988, we stayed close. Whenever he came in the state, I would see him on a fairly regular basis.

As Vice President?

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Was he D'Amato's?

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'88?

'88. I saw him many times, saw many of the people who were involved with his campaign. I was practicing law at the time with the law firm of Sidley & Austin, which I had joined in '77. So I could control my time a little bit. I was working very diligently on the campaign with no agenda in mind other than get him elected. Then, in the fall of 1988, as it was getting close to the election, the current President, 43, came to Illinois, and we got to know each other. He asked me what I was going to do after the election. I said, "Well, I'm going to go back and practice law." He said, "Well, my Dad is trying to bring people in from outside Washington, to help him in the administration. There are going to be some jobs you ought to consider." I said, "I never even thought anything about it. Why don't we wait--" naive as I was-- "why don't we wait until he gets elected before we start thinking about what we're going to do? Let's not pick out the drapes yet."

What happened during the campaign, if anything, your association with the campaign, to get noticed by--

That's hard to say. They are very loyal people. They knew I had been loyal since 1980. They knew I hadn't wavered. They knew I was there for them in 1980, when it was not doing well. They knew I was there for them in 1988. They probably figured out I wasn't a total nincompoop, and--he didn't have any particular position in mind. He just said, "There are a lot of positions to be filled." I'm sure he said, "You're a prosecutor, you're a lawyer, you know politics a little bit. You really ought to think about doing something in Washington." I really had not thought much about it at all, not at all.

Then, I started talking to people like Haley Barber and others, and they said, "Yes, you ought to think about it." So, I said, "Well, I'll think about it." Because at the same time I was doing this, I was chairman of the Regional Transportation Authority in Chicago, which is the second largest regional transportation agency in Chicago. I had a lot of experience in mass transit. I decided--and the Governor supported the idea--that, if Bush got elected, we ought to put my name in the hat for Secretary of Transportation, not thinking in a million years I'd get it. But it wouldn't hurt my practice if I was considered. I had no burning desire. I was not waking up, as many of these people do, thinking, I gotta go to Washington. I don't wake up today with a burning desire to go to Washington, but I end up going every once in a while.

In Illinois, the election was extraordinarily close. It didn't get settled until three in the morning. He had already won the Presidency, but we found out about four in the morning that President Bush, 41, had carried Illinois. Unless I say so, the President Bush I'm talking about is 41, not 43. When I'm talking about 43, I'll say so.

In the morning Thompson and I called President Bush from the office and said, "We want you to know, we won Illinois." He said, "I knew you would. I told those guys last night you would," in his very positive manner. Jim Thompson said, "Mr. Vice President, we would like you to consider Sam to be Secretary of Transportation." He said "sure." Then he ran off to a meeting with somebody--not being rude, because he's never rude to anybody, as I'm sure you know by now. He said "fine."

Then the process of the transition began, and because I knew several of the people, including Bob Teeter and others who were involved in the transition, I knew my name was in the hat. But not having any idea what was going to happen about it, I kept track of it because then, as a competitive human being, I was becoming a little interested. I was not necessarily thinking I would have it, but I didn't want to be embarrassed by it. I just wanted to manage my career in that regard.

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This was before the election?

No, this was after the election--November or early December. I think it was late November. No discussions were had with anybody until the election. After the election, Thompson said something to the then President-elect. He passed it on to the transition team. They went through all kinds of steps and everything, looking at various candidates for various jobs. As it turned out, there was not a strong political candidate for my job, for Secretary of Transportation, and I became the selectee.

Had you given any thought to Justice Department positions, given your history of prosecution?

I had not. First of all, Dick Thornburgh was in there, and he was going to stay. There were two holdovers, Dick Thornburgh and Nick Brady. So the job wasn't open. But later on I was offered to consider being Attorney General and declined it. I'll tell you about that.

The President-elect said, "We're going to announce it, but we want to do a group." So, on about two occasions, I went to Washington thinking I was going to be announced the next day and then turned around and came back because they didn't have the whole ticket put together. They did not want to announce all white males. They were trying to put a diverse Cabinet together, which they did. They were waiting for Lou Sullivan and the Secretary of the Interior [Manuel] Manny Lujan to be selected, and they put us all together in one announcement.

On the day that I went out for the announcement, I was sicker than a dog. I had the flu. So I went out and just lay around my room in the Hotel Washington until I barely got enough energy to go over to the White House, then went right back to bed at the hotel for another 24 hours. That's how we announced it. Shortly afterwards, the FBI [Federal Bureau of Investigation] investigation began, and I started disengaging from my practice of law and going to Washington to put together my transition team.

The announcement that you refer to was in December, as you can recall?

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What were the things that you had to do as soon as the official announcement came out?

Well, I didn't know anything about Washington, really. But I was fortunate in that, once you become nominated, all kinds of people come out of the woodwork, wanting jobs, wanting to help you, wanting to do everything. You're all of a sudden everybody's best friend. Fortunately, one of those people who wanted to be my best friend was quite competent, and I'd known him from Illinois. He headed the Illinois office for Governor Thompson. His name was Galen Reser. I asked Thompson if I could use Galen to help me during my confirmation process. Galen had worked for Senator Charles Percy, and he knew the Hill backward and forward. He became my unofficial helper, and he later became my Assistant Secretary for Congressional Affairs.

I also grabbed the brightest young lawyer I knew at Sidley and got him delegated to work with me doing the paperwork and doing the preparation. His name was Ken Quinn. Those were my first two hires.

The preparation for the confirmation?

The first thing you do when you're nominated, unless you're a slam dunk, is concentrate on your confirmation. If you assume your confirmation, even then--let alone now--that's a big mistake. You have to assume that there will be some controversy, who knows for what reason. So you concentrate almost entirely on your confirmation. The Department loads you up with briefing books about what the Department's all about and what kind of questions you're going to be asked. It's a very complex learning process, learning the Department and getting ready for your confirmation hearing.

Did anybody in the White House or on the transition team for Bush help you out here?

No. There were a couple of people at the White House who had been designated to help on the transition team, not at the White House, because the White House was getting together, too. The transition team had a fellow by the name of [Donald Robert] Rob Quartel, who was in charge of the transition. He and I talked a little bit, and he gave me the books. But basically, it's up to you to learn it. President Bush is a great delegator. He expects you to put it together on your own.

You get an office in the transition quarters with a secretary or someone to help you. I'll never forget this. I walked in there the same day Lou Sullivan did, the Secretary of Health, Education, and Welfare--and I think I didn't know what was going on. He had less knowledge, and I felt sorry for him. I said, "Lou, you have to get somebody who knows Washington to help you." He and I were alone in that we didn't have the slightest idea what this whole process was all about. I'd been blessed because I'd been a little bit involved in politics and, with the Governor's help, I got some people he knew who knew Washington, so I was a head up. But he had nobody. His office was right next to mine in the transition office.

So, the key is, if you're going to assume the kind of responsibility that you are, you have to surround yourself with people who know what they're doing, whether they're going to join you in the long run. You've got to do it recognizing that some people will be honest brokers. Others of them will have an agenda. Washington is full of people with agendas, and it's not the President's.

After your conversation when the President said that he wanted you to do the transportation thing, was there any further discussion about what he was looking for?

No. He said, "I want you to go over there and do a good job." That's the way he is. He's a great believer in delegating. He said, "I have confidence in you. I know you'll do a good job. We're going to have a great White House. We're going to have a great administration. I'm absolutely delighted you're coming. I want you to go over there and do the job that I know you can do." That was it. No instructions on what to do. No thoughts on what to do. He said, "Just do a good job."

Was that pretty much the way things stayed throughout the course of the transition?

I had position papers on a lot of things from the Department that they had taken already, from the FAA [Federal Aviation Administration] or the Coast Guard and everything else. I pretty well stuck to that. During the confirmation, you can play dumb. If you haven't been in the Department and you don't know anything about it, all the Congress wants to know is that you'll listen to them, that you'll be open-minded. They use it as a vehicle to get certain of their issues answered by the Department, prior to confirmation. But they don't expect you to come in and have a full-blown program as to how you're going to run the Department.

I did have one flap. When I was U.S. Attorney, I had been involved in a case involving G.D. Searle, which was a drug company, involving a product that had been on the market and then taken off the market, a NutraSweet product. When it became known that I was leaving the U.S. Attorney's office, I recused myself from that matter, because the firm that represented Searle was the firm I was going to. When I recused myself, I suggested that we hold up doing anything for a week or two until my successor came in, because I did not want them to make a decision and stick him with a case that he had not made a decision on. It was a high-profile case.

In wording the recusal, in saying why don't you wait for a couple of weeks, I assigned it to someone else, but I didn't anticipate it would be three months. In the meantime, the people who were against NutraSweet and Searle had gotten Senator Metzenbaum's attention. So Senator Metzenbaum was accusing me of all kinds of improprieties in the handling of the NutraSweet. He said the statute of limitations had run on the case during the time they were waiting for a new U.S. Attorney and, in recusing myself, I should have just said, "I remove myself, let the acting U.S. Attorney on that matter handle it." And, in retrospect, he was right.

But we had not anticipated that. I was trying to do was the right thing. It turned out to be nothing, by the way. The statute had not run, but they could make the case, and Senator Metzenbaum was Senator Metzenbaum. The FBI go back in the field and do a complete new update. In fact, the agent who did my background got an award for working over Christmas to do my update. He sent me a hat with my name on it, which I have subsequently lost, which bugs me. It was a memento.

We spent a substantial amount of time with Senator Metzenbaum. I decided to go in to see him and answer any questions he had, rather than deny it. During that time, the Senate was controlled by Democrats, and Senator [Ernest] Hollings was the chairman of the committee. He couldn't have been more gracious. He's a dear friend of mine now. I had first met him when I was a little boy. We were in New York City with my uncle for the opening night of Bye, Bye Birdie. He was the Lieutenant Governor of South Carolina. So, when I first went in to meet him, I said, "You don't recognize me, but I was fourteen years old when I first met you in New York City." We got along fabulously for the whole time I was there.

Did you go around and visit all of the members of the committee?

I visited all of the members of the committee, and I had to go through two committees, because Transit is headed by Public Works. So I visited, probably, with 30 Senators. I didn't know any of them at the time, other than our own Senators, which were [Alan] Dixon and [Paul] Simon.

Did they go with you?

No. But when I was presented to the committee, Congressman [Daniel] Rostenkowski--who was Chairman of the Ways and Means--as well as Senator Dixon and Senator Simon, along with Minority Leader Bob Michel, presented me. So, because I knew them all four so well from my work in transportation in Illinois, I went before the Democratic committee with a lot of support from both U.S. Senators, which was a big plus. Eventually, we were able to convince Senator Metzenbaum, at least sufficiently enough, that I had not operated improperly. And I was confirmed on February 1 by the Senate, 100 to nothing, including Senator Metzenbaum's vote, which is probably my biggest achievement in life, I might add. So, I was confirmed 100 to none.

By that time, when you know things are going pretty well, you start interviewing people to select for your Cabinet. Chase Untermeyer was the first head of Presidential Personnel for President Bush, and while the White House would present candidates to you, I was never told I had to hire anybody. The Office of Presidential Personnel asked me to consider candidates seriously, and I did, and got some good candidates as a result.

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On the other hand, I wanted competent people. I had a friend who was head of personnel at the Continental Bank in Chicago. I'd known him since the days I was selling computers. He came out and helped me put my team together. He moved into the hotel where I was staying, at the Jefferson. We started interviewing candidates for various jobs. Galen was there, Ken Quinn, the young lawyer. I had already decided to give Galen the job of Assistant Secretary for Congressional Affairs, because by going through the process I'd learned he knows everybody and was very good at it. I knew I needed a couple of bright young people around me, and Quinn was number one in his class at the law school, so I brought him with me.

Then I started building the staff, taking political recommendations on staff jobs--advance jobs, scheduling jobs, jobs like that. Then I had 16 presidential appointments. There, we went through a very elaborate process of scouting out candidates. In fact, I would say at least half the candidates came to me through the White House Office of Presidential Personnel, and half of them I went out and found. Then you negotiate with the White House Office of Presidential Personnel whether you can get this one or that one. And, almost without exception, it all worked out.

Did you have a problem with any Reagan holdovers in the Department? How did that go?

No. The decision had been made to let them all go. The Secretary was Jim Burnley, who had been under Reagan for a short period of time, when Mrs. [Elizabeth] Dole left. Jim told me all the people who were in the Department, who they were and how good they were. I kept one. I kept my chief of staff. I figured I needed somebody who knew the Department well, and he said that a guy heading the Maritime Administration was a Coast Guard Captain who knew his way around. So, I took him out of that job and made him my chief of staff. In doing so, I immediately had smart people, a guy who knew his way around the Department. I kept the Assistant Attorney General, Administration, who was excellent, John Seymour. All the rest, I hired. I knew a lot of people in the Department now. I knew people who knew people in the Department and had them working for me. But everybody else went.

Who made the decision that they go and how was it--?

I think the White House did that at the beginning.

And you didn't have to deal with that at all?

No. The President was to leave on the 20th, and Jim Burnley was to leave on the 20th. They were all to leave. The Cabinet was all to leave when the new President was sworn in, other than the two I mentioned. So Burnley was out. He wanted to use the car and driver for the 20th, for the inauguration. I said it was fine with me. You know, his resignation could have been designated at midnight on the 20th. I couldn't have cared less. I had a guy helping me find my way around town from the transition anyway. But the White House was so strict they wouldn't even allow that. He had to give the car and driver up on the 20th. They were very strict in that regard.

What about the appointments of non-career SES [senior executive service] and Schedule C, in terms of your interaction with the Office of Presidential Personnel?

Well, Schedule C, I deferred on. There were a lot of people who had worked in the campaign. Schedule C's--I basically looked through the supply of candidates that the White House provided me and found a number who could do scheduling, who could do advance work, who could do some staff work, who could be the liaison with the White House. Almost all of those were involved in the campaign. Either I knew them from the campaign or someone else did. There was not a shortage of those people. In fact, those people, as you know, in any administration, get the shaft. They do all of the work. They're very competent. Then, the people in Washington, some who've done a lot, some who've done nothing, end up, because they know the system, end up rolling over these young people who don't have a chance to get into the administration. I think that's true for every administration.

Who makes those decisions? And how can the insiders get around and push out the campaigners?

Well, because many of the people selected for the Cabinet don't know how much power they have. So, someone grabs them and says, "You have to get your own people around you. You can't have these people from the White House. They're hacks from the campaign." They end up taking a position, trying to draw lines in the sand. People can get on the White House list, some who've done little and some who've done a lot. That doesn't mean you compromise on experience. But if you have 100,000 people or 50,000 people work on the campaign nationwide--most of them are college graduates, some of them with master's degrees--you ought to be able to find some who can do a decent job in staff functions in the department. That doesn't mean they could lead an agency. But they certainly could perform, and they did.

I had a group of extremely loyal people around me who did an excellent job, and they came to me, most of them, through the campaign. I felt strongly that they ought to be getting a chance, but I would never compromise on quality. For example, this is a great one. I had never met this young man. He came to me from Texas. He was Hispanic, and he had worked on the President's campaign in Texas. He and his wife wanted to come out here and be part of the campaign. He was a graduate of the University of Texas. He was hired as my receptionist in the front office. That's how badly he wanted a job. He has since gone on and done three or four other jobs in the Bush administrations. But he never would have gotten a job. His wife came with him. She was a computer technician. I got her a job at the FAA, which was no problem, because they were desperate for competent computer technicians. He ended up doing various other things for me. Plus he named his first son after me. So, I got a namesake.

The point is, the guy could never have broken through. If you're not willing to take a look at people like that, he never would have broken through. I was willing to do so, and it never, never, never compromised quality at all. In fact, you also know that those people are loyal to you, because they know you picked them. They know that you picked them. The biggest mistake anybody can make is keeping a holdover in the same job, because that person does not believe he is loyal to you, and loyalty is everything in Washington. If you start out every morning without loyalty from your senior staff and your employees, you're dead. They'll cut you to death. So, even when I moved John Gaughan, who's a very loyal guy and a Coast Guard, salute 'em, yes-sir guy, I moved him to a new job. So he knew he was staying at the Department in a new job because I wanted him.

Vernon Jordan once told me, "People are everything, and pick your own people." And he's absolutely right. It's just critical.

S. Skinner, 1/22/02 44

? 2021 The Rector and Visitors of the University of Virginia and the George Bush Presidential Library Foundation

In previous administrations, the conflict between the White House Office of Presidential Personnel and the Cabinet is that the White House OPP is afraid that the Cabinet people will be picking people who are loyal to them rather than to the President. Is that ever a problem?

Well, that's what they say, but the point is we both ought to be loyal to the President. My theory is if you can't be loyal to the President, get out of the job. That was one of the problems the Bush administration had. There were people who were not totally loyal to him. And he was totally loyal to them. They were feathering their own nests to some degree to the detriment of the President. I don't know how that happened, but I think that's true. It wasn't universal, but there was too much of it. I don't think this administration has much of it at all. They don't tolerate it. If they think you're disloyal for a minute, you're gone. They'll cut you out in a second. Loyalty is everything to President 43. Loyalty is everything to President 41, but from him to them. He's probably not as exacting, as tough, and as critical of people who are not loyal to him as President 43 is. That's my observation, anyway.

We'll get into some more of that later, because that's a very important aspect.

So, we began to form the Department staff. I started seeking advice. As I said, Gene Croisant was interviewing the candidates. For instance, we needed someone for highways, which is a big job in the Department of Transportation. I went to Dick Thornburgh, and I said, "I'm having trouble finding a really top drawer person to head highways." He said, "You ought to look at the guy I had as head of highways in Pennsylvania, Tom Larsen. He's not on application. He's not applying. He's a professor down at Penn State University." So I recruited him to come up and talk to me. He didn't want the job. He went off to Greece for a trip and said he wasn't going to take the job. Then I sent Gene Croisant out to see him again. I said, "Gene, you go out and see him at Penn State and talk him into taking the job." We had to talk him into taking the job. But he was extraordinary. He's one of the most respected transportation experts in the United States, if not the world. And he did a phenomenal job. But I reached out for him.

My FAA administrator, Gene Croisant, said, "We start looking for someone?" I said, "I want someone with aviation experience, and I want someone with military experience." And he came up with a name.

Why the military?

I wanted someone with heavy experience, and I have a propensity to work with military people. All things being equal, if there are two candidates of equal quality, man or woman, sitting next to me, and one has military experience, I'll take him every day. They've got to be equal, but I'll take him every day. Number one, they're more disciplined. They're more loyal. They grew up in a system that doesn't tolerate quirks. I'm talking about top-flight military officers or senior enlisted men. I have a lot of respect for the military.

So he said, "Well, there's an individual named James Busey, who's a four-star in the Navy. He's the NATO [North Atlantic Treaty Organization] commander in Italy for Southern Europe, and he's getting ready to retire. My friend tells me about this guy. He has the Navy Cross. He was Vice Chief of Naval Operations." So I called him out in NATO and asked him if, when he was coming in, he would interview with me. He said, "Sure, I'll be glad to talk to you." And I talked to him, and the more I checked him out, the more I liked him. So I offered him a job, and he took it. He is, in my opinion, the best FAA ever had. He later became deputy when I went to the White House. He was as good an administrator as that agency has ever had.

On the other hand, for the head of the Railroad Administration, the White House had a candidate from Mississippi who had basically been the founder of the Republican Party in Mississippi, a guy by the name of Gil Carmichael. I took him. And, he was, you know, a railroad fanatic, which you almost need to be in that job. He's now head of the Amtrak Reform Council.

So I took a combination. My deputy Elaine Chao came recommended from Chase Untermeyer in the White House, and I took her. So they came from a combination of sources.

Were there any other, anybody else at the White House who tried to intervene on personnel issues, aside from Chase and OPP?

Oh, Chase was very professional. Chase's job was to make sure his candidates got considered, and as long as he was comfortable, they got considered, that was fine. At no time did I ever get rolled on a candidate or told, "This is who's going to be your deputy. This is who's going to be this and that." I could have been rolled if that's what the President wanted. If I felt strongly, I'd want to hear it from either the President or John Sununu personally, and make my case. But, once they decided, I'd live with it. So I wasn't averse to it--I understand who I work for. But they never did that. That was not President Bush's style. President Bush is a great empowerer of people. He would pick good people and empower them to do their job. And he would leave you alone. If there were any problems, he would bail you out or support you, but he would never undercut you.

For a President, it seems to me, with that style to empower people and leave them alone, there can be a down side, too. Perhaps he had some problems as President for that.

I saw both sides of that, both as a Cabinet member and at the White House.

We asked specifically about Reagan holdovers, and you said there had been only the one. But I wonder more generally, because of the nature of some of the reports that we have gotten about the transition, whether you had sensed any tension between the outgoing administration and the incoming?

Well, yes. First of all, these are good jobs for a lot of people, and they want to keep them as long as they can. I would argue that a lot of people, after eight years, if they're doing their job, get tired, and it's time to move on anyway. But some of them don't see it that way.

There was a feeling that the order to get rid of all of them on January 20th was a little severe, and that President Bush was an ingrate. I'm reminded of what [Abraham] Lincoln said, "You interview ten people. You reject nine. You have nine enemies and one ingrate." I think there's something to that. But the point was that if you didn't do that, you could never get your own team in. And he wanted to put his own imprimatur on his own administration.

The background to that feeling, perhaps, or an element of it, was that there was a fair amount in the press about Bush needing to establish his own imprimatur.

Right. They say every Vice President has that problem. I think he wanted to do that, but I think he had probably seen a lot of people who had been shunned away because they were Bush people, like me. He might want to give them their chance.

Chase has said that one of the toughest jobs he had was throwing out good, loyal Republicans who'd been there in the Reagan administration, and replacing them with the Bush people, because he had to have his own administration, of course.

That's true. Then we began the putting together. And basically you were on your own to make your own mistakes. They would occasionally slap you back if you'd gone too far. But they pretty well left it up to you.

Who in the White House would intervene, and about what types of issues?

Well, one of the first things that came on my agenda was CAFE [Corporate Average Fuel Efficiency], which is automobile efficiency and what the standards should be. The standard was 26, and the law allows the Secretary to raise it to 26?. I felt it had not been raised, and that it made some sense to do something, because we were getting further and further in the hole on energy dependency and everything else. So I got it raised to 26?.

Well, all heck broke out. The conservatives thought I was a re-regulator. I was never intending to push for any more legislation than 26?. I also thought that by raising it a half, to the maximum, I could buy some time from those who were pushing to raise it higher, and don't forget we had a Democratic House and a Democratic Senate. But some people didn't see it that way. So I got a little flack from the Wall Street Journal and others on that.

But not from the White House?

I think the Office of Management and Budget pushed back on that, too. But they pushed back because somebody was pushing them. That was one little flap. I got into airline regulation a little bit. Northwest Airlines was in serious financial trouble, and they wanted a financing package to take it over. They were getting foreign financing. The law said you couldn't own more than 49%, and I got into determining how much of that 49% should be there. So some people who were free marketers thought I was, by enforcing the law-- It really wasn't that I had anything against foreign ownership. That issue never presented to me.

I did not want an airline so heavily leveraged--with foreign or non-foreign money--that it couldn't operate its business plan effectively. I believed that one of the things that there would be a tendency to slip on would clearly be the purchase of new equipment but, more importantly, on maintenance and safety. I felt that an airline that is so stretched might compromise on safety. So I wanted there to be more equity in the deal. I was criticized a little bit on that, but it was the absolute right thing to do. We ended up working it out, and it dealt with the amount of foreign equity that would be in, as well as domestic equity. They were looking for the foreign airline to put all the equity in, and the owners would put nothing in. And, it turned out, the deal at Northwest ended up being a home run for the owners because they ended up getting a lot of financing from the State of Minnesota, et cetera. Those were a couple of major issues.

And you did hear back from the White House on that one?

Oh, yes, you would hear back. You would have a process to go through to get them approved. You had to go through OIRA, the Office of Regulatory Affairs. So there would be give and take.

In the OMB [Office of Management and Budget].

OMB. But it wasn't like my life was being made miserable. I mean, I don't like being criticized in the Wall Street Journal, but other than that. And that only happened a couple of times. Let's talk about a couple of the crisis situations that I had.

You had a number.

I did, and none by my choosing. The first one was Eastern Airlines shortly after I went in. All of a sudden, Eastern Airlines had major labor problems, major financial problems, and the issue was, what were we going to do? The first thing I did was put a special team at the FAA on their maintenance safety. They were bleeding money, and I was worried. We were getting allegations that safety was being compromised by the union people. And so we put a SWAT [special weapons and tactics] team on maintenance for Eastern Airlines and watched it very carefully.

Then the strike came. Of course, I was in the middle there. We had some authority to do something in a strike, but I suggested that we just keep hands off and let the normal course of events take place. Unfortunately, that was the bankruptcy, eventually, of the airline. That was the first time you realized as Secretary that when you go up to New York and there's 40 cameras looking you in the face, there are some big issues in this Department.

But I never wavered about government intervention for a minute, nor did the President, even though a lot of people were out of jobs and lost their jobs. It was a business model that wasn't going to work anyway, and we shouldn't get in.

[BREAK]

We basically decided to keep hands off the problem, and eventually the whole airline disappeared. I don't know that that was what we wanted to accomplish, but that was the end result. The next one was Exxon Valdez--

I want to pose a question about your being in the driver's seat, so to speak, on the Eastern Airlines problem. Was that because you had statutory responsibilities in that area as Secretary?

Right.

In some of the subsequent cases, it's not so clear whether it came to you because the President designated you from among a group of likely candidates, or whether it came to you because you were the most likely statutory--

The first one was because of my statutory. The others were because I'd done the first one.

Okay. Good.

After a couple of hard-working months, I decided to take a three-day vacation in March, to go down to Jacksonville, Florida, to spend the weekend with some friends. I think I got down there on a Friday. On Saturday I was watching television and, of course, being in contact with the Coast Guard about the spill in Alaska. On Monday, the President called and said he was having a meeting on Tuesday in the White House and could I send somebody, which is an indication of how gracious he is.

I said no, I would come myself. So Tuesday morning I went up to the White House. Admiral [Paul A.] Yost [Jr.], the Commandant, laid out a map of what had happened and what was going on. Tuesday afternoon at one o'clock I was on my way to Alaska.

Who was at the meeting?

The President, the Vice President, John Sununu, of course--there may have been a couple of other people from the White House staff--the Commandant of the Coast Guard. I was there. Bill Reilly was there. I think Bob Mosbacher may have been there, because NOAA [National Oceanic and Atmospheric Association] was involved.

But a decision was taken at that meeting that you would be the primary administration point person on this as opposed to Reilly?

I think that may be a little strong. I said I would go up there. So he said, "Fine." He didn't order me to go up, but maybe it was a consensus that somebody ought to go, or a group ought to go up there. Bill went with us. Administrator Reilly and I went up together, along with the Commandant. Then, with Administrator Reilly, I ended up being the spokesperson about what was going on, what we were doing, what we were planning to do. Also, because the Coast Guard worked under me and they had the major responsibility for spill containment, I had taken the responsibility of interfacing with Exxon on it.

What were the key, major decisions that you had to make in the crisis?

Well, number one, I had to make sure that everything was being done that possibly could be done. It was a very, very huge task because the spill was so large, and no contingency plan had ever been devised up there for a spill of this magnitude. All of the equipment and everything that needed to be done was inadequate to contain a spill of this magnitude. I wanted to make sure we were doing whatever we could to contain it. I quickly became convinced that Exxon was doing everything they could. They had marshaled all of the resources from throughout the world. It was being flown in at their expense to do it. But there just wasn't enough. I mean, with the oil pouring out the way it was pouring out, you couldn't contain it. There were not enough booms to contain it. It was just overflowing the booms.

Then, of course, there was the whole issue that you've got to show the American people that you care about the environment and you're doing something. But what do you do about it when it's washing up on the shores and there are dead birds washing up and everything else? We had a thousand people out there cleaning rocks with cloths, with Handi-Wipes. There really had never been a spill of this magnitude, and people didn't know what the long-term effects were going to be. Our job was basically to marshal resources and make sure we were staying on top of everybody and try to prevent as much damage as we could.

Can you take us through what happened when you got on the ground in Alaska?

I almost got killed on the way in. There were so many airplanes coming into Valdez, Alaska--which is just a one-strip and a port down there--that we almost hit a helicopter on the way in and had to do a go-around. So my trip to Valdez was almost shortened, as was the helicopter. When we got into Valdez that morning, I went up to the control tower, which had been temporarily set up by the FAA, and we had airplanes and equipment coming in from all over the world. We had boats coming in. It was just coming in, airplane after airplane, day in and day out. Basically, every seaplane and every helicopter in Alaska had been marshaled into Valdez at that time.

We took a boat out to the command cutter. We had cutters coming up from all over the west coast, steaming up. We were trying to get everybody organized and trying to see what equipment and what technology was available to deal with a spill of this magnitude. The first meeting with Exxon was out on the cutter. Their senior person came on, a guy named Otto Harrison, and we had a huge blow-out with him. We turned out to have a good relationship with Exxon over the years. But the important thing of this whole spill is that, had it been a small little carrier, there is no way that anybody would have marshaled the resources that Exxon did. I mean, Amoco--which is no longer in business--had a spill over in France. They fought it tooth and nail and ended up paying a couple of hundred million dollars ten years later. Exxon has probably spent $10 billion between the court judgments and everything else. They spent $3 billion on the spill alone, trying to clean it up.

I thought that it didn't do any good to get into a fight with Exxon, as long as I was convinced they were doing everything they could. It didn't help Exxon or us. So, once I was convinced that Exxon was fully engaged--which took a conversation--it was mainly the attitude. Everybody was a little tired and defensive and everything else. But once we got over that hurdle--

So the blow-up was just over the fact that you were there looking over his shoulder--

It was a blow-up because we had this huge mess that was their fault, and Otto Harrison--while he understood that it was a spill that had to be cleaned up--did not understand the PR [public relations] magnitude of the problem. Not only did they have to do it, but they had to tell everybody what they were doing. And that was a problem that Exxon was criticized for, going forward: how they handled the PR. Larry Rawl did not want to go up to Alaska. I think Lee Raymond, who is now the CEO, did want to go up, but Rawl was the CEO, and they made a decision to have Otto Harrison, one of their division presidents, go up there. In retrospect, I think they would have to admit that maybe they should have gone up and camped out there. They should have set up a corporate office there and had one or the other of them up there the entire time. But Exxon just wasn't aware of the PR implications of this.

Were you also meeting with local officials?

Oh, yes, hundreds of them: the Governors, the Senators, the native Alaskans, the conservation people. We had a constant stream of people coming through, worried about the problem, wanting to know what was going to happen to them. At the same time, the dichotomy of what was going on was that, in the short run--putting aside what was going to happen to the environment--this was the biggest boon to the economy of Alaska in the last ten years. Guys were getting three times their normal charter rate for boats, 24 hours a day, seven days a week. They were signing them up for six months at a crack. These helicopter operators were charging $2,000-$3,000 an hour. Money was just pouring into Alaska, into the economy.

We did not know, because we'd never had a spill-- But we did know the environmentalist and the people from NOAA could not tell us what the long-term implications were going to be. As we now know, our environment is strong, and while we lost birds and animals, we were spending an extraordinary amount. The PR part of it was extraordinarily important. We would find a bird, an eagle, with oil on it, that couldn't fly. We would spend hundreds of thousands of dollars in these bird-caring centers to take care of this eagle. When the eagle flew that had been full of tar, that was a $100,000 eagle or more. We had veterinarians and bird experts from throughout the world coming in and camping out there, and they would be saving two or three birds.

Did you establish a crisis management group?

We all met and had a meeting. The Coast Guard ran it. We had meetings with NOAA, with the EPA [Environmental Protection Agency], and we all met every morning up there. They continued the meetings. The Commandant and I came back after a few days, but I asked him to send a senior admiral to be our point person up there. There was always coverage up there, from the moment of the spill.

And oversight?

Oversight. And that admiral would report back to us daily. Then I'd get weekly written reports. That went on. After a while, the attention in the media died down, but we still continued to do whatever we could. By then, we were learning a little bit more about what we could and couldn't do. The idea was to bring these big steamers in and steam the oil off the rocks and try and capture it. It's like the Katzenjammer kids to some degree. But a lot of it was just to make sure that everybody knew we were doing everything that we could. The picture that was being shown was 2,000 people on the beach cleaning rocks off with Handi-Wipes, which also helped the economy of Alaska.

You and Bill Reilly, during this period, were working together. Were there ever--

Never. Never a problem. We might have had problems underneath, but Bill Reilly and I never had a problem. We had a great relationship. I never saw Bill Reilly ever lose his temper over-- I guess maybe I did. I don't remember when, but I think there was a time a two. Because he was an environmentalist, Bill sometimes did not have the respect of some people within the administration that he probably should have had. But he always had the respect of the President. He always had my respect. I think some of the hardheads probably gave him a tough time. He would be out on the point sometimes, out beyond where the President wanted to be, and he'd have to be reined in. But that was his job, I always thought.

Did you have a special connection with the White House during the period of the crisis management? Did you do the reporting? Was somebody from the White House detailed? What about the press?

The main contact was John Sununu. John and I interfaced. I would keep him constantly advised. My feeling always was that the White House should never be surprised, so I always tried to tell them what was going on before they read it in the newspaper. And over time, I developed a relationship with the White House that was pretty good, not just because I knew the President, but because, number one, I was doing my job. Number two, I wasn't giving them too much trouble. And number three, when I represented the administration on television, I didn't stub my toe too bad. All those things gave them growing confidence, I think, in my ability to do my job, because I was an unknown. Then, when Washingtonian ranked me as the top Cabinet officer, that didn't hurt any.

Was your relationship with the White House typical of other Cabinet Secretaries' relations with the White House?

No.

How does that dynamic work?

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I would see the President a little bit more than a lot of them, but we never really talked business. Those were all social functions, and I never abused that. I always compartmentalized that. He was very gracious, and we were good friends with his daughter and good friends with them. He liked to play golf, and I liked to play golf, so when we went off, we would do that. But when we came back, it never crossed the line. And I never, ever tried to use it to go around John Sununu. I always respected the chain of command.

Did everybody else understand that, or did other Cabinet Secretaries think that you had the inside track?

No. No. No. I don't know what they thought. Access to the President was everything. It is to all Presidents. When you're in the White House, it's how close your office is to his, and when you're outside, how often do you see him? Baker obviously had a special relationship with him, and he established early on--because he'd been in the White House--that he would have a weekly meeting with him. [Dick] Cheney did the same thing, because he'd been in the White House. Brady had somewhat of the same thing. But other than those three, none of the other Cabinet officers would see him, other than going through the proper process, which was through John Sununu. I didn't find John Sununu to be overly protective of him. I never once wanted to see the President when I didn't get to see him. But I didn't abuse it. My life wasn't ending because I wasn't having lunch with him.

I also would be over at the White House probably more than some Cabinet Secretaries, because I liked to use the Mess. Occasionally I'd go over there and have lunch, but mainly I'd have someone in, and I would take them over to the Mess. It was a nice thing to do, a highlight of their month, their year, or their life, maybe. I would try to reserve a table and go over to the Executive Mess for lunch on a regular basis. I would see some of the staff there. I'd go over there sometimes at night and have an early dinner when my wife was working back in Chicago and I was here. So I was probably over at the White House a little bit more than they were. But they had family and other obligations. I was single at the time and was married in August of '89. I was pretty much into the job.

Did the Bush White House try to clamp down on access? I guess this is more the White House staff, I just remember this when, during the transition, they said, well, the fewer people with Mess privileges and so forth. Was that anything you were aware of?

No. In the White House, there's always what level you are, what pass you have in the White House, what access you have to the Executive Mess, the regular Mess, et cetera. The Clinton administration got rid of the Executive Mess. I think they've put it back into place now. But those are inside baseball stories. It was set up the way it was in the Reagan administration, I think, and he just kept it that way. It wasn't a big deal.

Did you go to regular Cabinet meetings, as Secretary?

Well, they would call them periodically. They're mainly communication meetings. There's no substance. The substance is done long before it gets to the Cabinet. Mainly the Cabinet sits around, and he brings you up to date on certain things he wants you to know and certain things you're going to do. They're usually no more than an hour. There may be a policy discussion here or there, which is already in summary form, and they've already decided which way to go. Maybe it was that way in the old days, but these meetings are not major policy meetings. That's done in the Economic Policy Counsel, the Domestic Policy Council.

How did those work, the Economic and Domestic Policy Councils?

Those were worked by deputies, mainly. In other words, if an issue came up that was multi-agency, the White House--either the Cabinet Secretary, or Roger Porter, the Domestic Policy Counsel--would put them together, and we'd have meetings and discuss it. They'd all be prepared on paper. Sometimes the deputies would participate before, and, obviously, the Office of Management and Budget had a big say in it and continued to do so.

And that was a useful mechanism for policy development?

Well, it seemed to work. There weren't a whole lot of disagreements that I knew of. There were occasional ones.

Did most of the important stuff go through those?

Oh, yes. State didn't go through that. They went through another, different process. State and Defense have a different mechanism. That's the National Security Council. But most of the domestic issues that were interagency would go through that process, and they'd get resolved. If you had a policy-- I put out a national transportation policy, which was a blueprint for what we wanted to do in transportation. That had to be vetted by all the agencies and then reported on. Part of the problem of Secretary is managing the interagency process and making sure that, whatever you propose, you don't get too far out front without knowing that it will be approved. The last thing in the world you want to do is propose something that gets knocked down, because you know it will immediately leak, and you'll be embarrassed, and your credibility as a Cabinet Secretary will be undercut. So you don't want to take on too many projects you're not going to be successful on.

I think we can come back to some other things, but I wanted to finish with the crises.

The first one when I came on was Lockerbie. That had happened in December of '88, and I was sworn in February 1 of '89. So all of a sudden, I had Lockerbie on my front burner. The issues there were making sure we found out how it happened, and tightening down the process and procedures that we had to make sure it worked correctly in the future.

Which process?

The security process at airports, trying to get international airports and international airlines to comply with U.S. requirements. No small task. Trying to make sure what we wanted to do and how we wanted to conduct it. We had constant pressure from the families, which the Bush administration 43 is now having as a result of-- I told them a year ago it was going to happen, too. I saw it first-hand. The families have now organized out of 9/11 and are a very vocal and powerful group of constituents. They may be small in number, but they carry a very big stick. We tried to do it on our own. Then we decided that a presidential commission was appropriate, and we formed one. It was the right thing to do, because it gave some closure to the public. This administration is not supporting that--not totally, it doesn't look like. But the House and the Senate are almost unanimous and had an agreement on it last week, in fact.

So we wanted to interface with the families and try to make sure they understood we were doing everything we could, but recognizing that their demands were not going to be met totally. I think I ended up with a fairly good relationship with the families.

You were in a central role here because of statutory responsibilities?

Yes. Who else were they going to go to, other than the White House? It all depends on what the philosophy on delegation versus non-delegation is. President Bush 41 is a great delegator. I think they run a much tighter ship at 43 than they did at 41 out of the White House. I know they do.

Where I went on political travel, I would take a request from the RNC [Republican National Committee], but it was not coordinated out of the White House. They would call and say, "Can you go down here and do this or that?" And I would, of course. But I did a lot of it on my own. Members of my committees wanted me to come down--the ranking member of the appropriations committee in his district. A lot of my political travel was for members of the committees that had jurisdiction over me, to be supportive of them. I never did any Democratic fundraising, obviously, but I did Republican fundraising. The rest of my travel was if Senator Hollings wanted me to come down to South Carolina and look at a bridge and decide whether it should be replaced, I would be able to do that. All of that was controlled by me.

Today, it's controlled by the White House. You go into a Senator or Congressman's district, most of it is run by the White House and cleared by the White House. And it has to be consistent with the White House view of where you should be. You were working on your own message. You would occasionally be required to go and do the President's message, but right now, these Cabinet officers are told where to go and when to go and what message to carry. And it may or may not be related to their area of jurisdiction. We didn't have that, as I look back.

Did you wish you had?

No. No. I loved it the way I had it. I had a job to do, and he let me do it. I was more than glad to do whatever they wanted me to do. But I think it would have been a horrible waste of time to have a Cabinet officer, with everything that was going on, be required to fly to Minneapolis, and then to Des Moines, and then to St. Louis, to give a message on terrorism, with the hope that you might get one or two newspapers to hook into it. I've seen Cabinet officers go out and not get any publicity at all. They spent two days on the road without any. They don't have the bully pulpit. Or the publicity they get isn't worth the venture. That is a very structured way to do it, but you could question the cost effectiveness of it.

Part of my question relates to interagency coordination. In the Lockerbie case, you said who else would do this? And what immediately comes to mind is that there's a law enforcement dimension to this that might have had--

Right. I was interfacing with Justice and the CIA [Central Intelligence Agency] all the time.

Talk with us a little bit about how you did that. Who was involved? If we're trying to put together a history of this event, it's helpful to know who the key actors were, what you were interacting, to what extent there was agreement--

One reason we're interested in this is that these were obviously successfully managed and resulted in benefit to the administration, which could have been a disaster. That's one reason we want to know how you brought it off.

Well, Bill Webster and Dick Thornburgh had the investigative responsibility for Lockerbie, interfacing with State because of the implications of Libya. They would come over periodically and brief me on what they were finding. We'd go into a secure room, and they'd brief me. We did not have any significant role. If they had any warnings, they'd give them to me. But primarily they were just giving me the courtesy of the update once a month on the investigation. It had been delegated to and was being handled by Justice and the CIA. And the State Department was obviously involved, because eventually you had to put pressure on [Muammar] Gaddafi to get them prosecuted.

But in this administration, there were very few personality problems. Everybody got along great. Everybody respected each other. Everybody would let everybody do their job, and everybody tried to cooperate with each other.

I got a very nice letter from the President once, because Dick Thornburgh was working on a project, and, as a former U.S. Attorney, I had helped lobby some Congressmen and Senators for him on this project. After doing it, I get a nice letter from the President saying, "Dick Thornburgh has told me what a great job you did in helping him." He set the tone, the shadow of the leader. You're expected to work with your counterpart. President Bush hates bickering, hates pettiness, and does not want to be around it. Does not tolerate it. Does not like it. Does not associate with people, generally, who are involved in it.

Now that doesn't mean that there wouldn't be a battle here or there, and maybe it would get a little emotional. And he had a Chief of Staff, John Sununu, who could get very emotional on things, because John feels very strongly. But it wouldn't be the President. You need somebody like that to be the enforcer. That's what John's role was.

One of the things that we're attentive to, viewing from outside, is conflict within an administration and how conflict is resolved. What you're suggesting is that one way you resolve it is you get people who are conflict-averse, or who are team members, in crucial positions. You have them do their jobs, and the level of conflict is diminished.

Right.

I'm continuing to probe as we go through these things to see where there were instances of conflict.

Well, that's right. I mentioned Jack Kemp would like to have been Secretary of the Treasury instead of HUD [Housing and Urban Development]. So he got into areas that were outside his area of jurisdiction. He was vocal about it, and that obviously rubbed people the wrong way. It rubbed Jim Baker the wrong way. It rubbed John Sununu the wrong way. It rubbed, I'm sure, several other people. I never had that problem with him. I'm sure it rubbed Nick Brady the wrong way, especially when it was in the paper. That's because Jack's area of interest was well beyond just HUD, and he has strong opinions, which aren't necessarily the President's or other people's. When you have people like that, you're bound to have those kinds of conflicts. When you don't, you're not going to have them.

Well, other than cases where there might be a jurisdictional dispute over who would take lead responsibility--and that's why I'm asking who else was involved in some of these other, very high-profile instances of disasters or special cases. Because they're high profile. They tend to be very taxing on one intellectually. They tend to be very taxing emotionally.

FEMA [Federal Emergency Management Agency] was basically a very weak agency. After these series of disasters, FEMA, in the Clinton administration, was built up to be forceful and it still is, I think, in the Bush 43 administration. President Clinton picked Jamie Lee Witt to lead that, and he was one of his closest friends. The President's campaign manager is head of FEMA. So FEMA would have a much bigger role than it ever had before. It just so happened that when I was there, there was no strong FEMA. With Eastern Airlines and Exxon Valdez, you could have made an argument that I should have been it anyway, because it was clean-up--but clearly not the earthquake.

The earthquake and Hugo.

Yes. The earthquake in San Francisco would have been a FEMA thing. The earthquake, going to another crisis-- I'm sitting at dinner with the President, listening to him give a speech, and a Secret Service agent comes and grabs me and hauls me to the back room where John Sununu has already been called out of the dinner. He says, "We've had an earthquake in California. I think you ought to go out there and find out what's going on." I'm sure John asked me to do that because I'd done these other things and had not embarrassed him. That would normally go to FEMA in today's world.

I went out there with the President, the Vice President, and a bunch of other people. They kid me about this, but when I was meeting with the President and the Mayor and the Governor, Mayor [Arthur] Agnos asked the President, "Who's going to follow up on this?" And I volunteered, "I'll be glad to do that for you." I thought there was a void to be filled there, and I was there, and I ought to help them out. I never did any of these to ingratiate my position as the "Master of Disaster." I felt strongly that I was there to serve the President, and if the President needed help, and he was right there, I would be glad to pitch in and help. If he wanted to say, "No, let so-and-so do it," that would be fine with me, too. I had more than enough turf. I never was into a turf battle with anybody. Now obviously, if they tried to take the Coast Guard or the FAA away, I probably would have been. There would have been a major battle. But it never came up.

I was trying to do the job and support the President. That was my approach to the job. I think that went over well with the President and with a lot of other people. While there was some jealousy, I don't think anybody really thought I was-- They knew I probably would never run for office. I wasn't looking to be President of the United States.

Which wasn't true of Kemp.

No, I think that's probably true. There were probably three or four people in there. I mean, in a different circumstance, I think Jim Baker would have been a good one. But there weren't too many presidential candidates. I guess there are three, if you look at it. Cheney once played around with it, as I recall, briefly. Baker thought about it briefly. And Kemp, obviously. But those were the only three. Other than that, I can't think of anybody around that room who ever thought about running for President.

Your predecessor? Elizabeth Dole?

Oh, yes. Well, she was also in the Cabinet, as Secretary of Labor for a while, until she went to the Red Cross. She probably did. So I guess there were a few. Elizabeth Dole--she and Bob were one of the first people to invite us out for brunch one Sunday when we first came to Washington--couldn't have been more gracious. She obviously knew how the process worked. She knew that Cabinet officers can help each other and be allies, and they ought to get to know each other. I think that was her program. I did the same thing with new ones when they came in.

Did you have any surprises when you got to Washington, in the Department of Transportation? Was there anything that really surprised you about it?

Yes. How good they were, what a great department it was, what great people they were.

You had a high opinion of the careerists?

Very high. The career people were outstanding. I also found that the FAA had been ostracized. The Coast Guard had been under-appreciated. The FAA had been undercut and ostracized on things that were clearly within their bailiwick. The Department was made up of a lot of good people, and if you empowered them and managed them, you could get a lot of good things done, without a lot of leaks, without a lot of anything. So, number one, I had my swearing in at the FAA, to send a signal to the FAA that they were part of the Department, and the President came to it. I flew every kind of Coast Guard helicopter and airplane they had. I was on every kind of ship there was. I went to visit the most outward, outmost post of the Coast Guard, in Turkey, on Christmas Day, to spend Christmas Day with them one year.

It paid off. I got unbelievable loyalty from both those agencies. I got unbelievable results from both of them. I enjoyed it. It made the job a lot more fun, because we appreciated each other, and it was a results-oriented, results-driven organization. REDACTEDTEXTREDACTEDTEXT REDACTEDTEXT REDACTEDTEXT REDACTEDTEXT REDACTEDTEXT REDACTEDTEXT REDACTEDTEXT REDACTEDTEXT REDACTEDTEXT REDACTEDTEXT REDACTEDTEXT REDACTEDTEXT

Though it was your approach, actually.

Well, it is my approach. It is my approach, but it's also his approach. He and I share the same philosophy on how to manage. And I do that with my organization today. I have nine individual business units, all with CEOs, all with thousands of people working for them. They don't think so, but I pretty much leave them alone.

What about the press? President Bush did have some feelings about some of the media.

They're beginning to write stories about it. My theory on the press is-- First of all, I had very good PR people in transportation press. First, I took a guy by the name of David Prosperi, who was my Assistant Secretary for Public Affairs. He'd been with [Dan] Quayle, and he was a very experienced guy. When he left, I stole Marion Blakey away from Bob Mosbacher at Commerce and made her the Assistant Secretary. Now she's FAA administrator. I had good press people. I spent time with the press, the local business press. That's Don Phillips of the Washington Post, Bob Hager of NBC. I spent time with them. We talked about substantive matters within the Department, and I got a certain amount of good press. Then when these disasters happen, they generate a certain number of profiles.

A press secretary is going to do that, go out and try to generate these stories. I didn't object to that. In Washington, to be effective, you have to be perceived as being effective. If you don't have the persona, it doesn't help you. But on the other hand, I didn't obsess on it. To show you, most of my clips were in the basement buried in a thing that got flooded out. I went through them and looked at them. I didn't care anything about the clips. There were a couple of little mementos I cared about--when I danced with Princess Diana, for example. That I cared about. But other than that, I was not obsessed with it like some people are in Washington. I knew that good press would be helpful, and I hired people who were capable of interfacing with the press.

Now, the White House press is completely different. People are beginning to write about the White House press now. That's a very tough deal. You take someone and you say, "You have arrived in journalism. You are now our broadcast journalist from the White House," or "You're our print journalist from the White House. You have reached the pinnacle of your career." Then they go in, and the first thing they do is they put them into the White House press office, which is a pit on top of a swimming pool. They're jammed in with everybody. Instead of being totally surrounded by peers of excellent quality, you could have somebody in here from a local newspaper who has two years of journalism experience that's credentialed to the White House. So, number one, you're not associating with your peers, and you're not doing it in an environment that someone who's the best deserves.

Then, number two--especially in a tight White House--you don't get any news, other than through leaks or what they want you to have. And yet, you can't go to your editor and say, "I want out of White House. You've given me the best job in journalism. I want out." So what they do is, they sit in these jobs too long. They're frustrated. They don't like being told what to write. They hate being co-opted by someone who's got information. If the Washington Post gets it, and you don't, you're professionally embarrassed, and publicly embarrassed as well. So they feed off of each other. When the President leaves at 7:00, they've got to be up at 4:00 and at the airport at 5:30, to wait around for him. It makes for some angry--like a bunch of hungry lions. Frustrated hungry lions, I might add.

That does not make for a good atmosphere and relationship. You probably have seen it down there in Washington. This White House has the best control of leaks and press I've ever seen. That's their job. I admire them for it. I applaud them for it. I wish I'd had it. The leaks are minimal. They've got iron discipline down there, and the press is frustrated as heck about it, and they're starting to talk about it and write about it. So what? The Clinton administration did not have that, and Lord only knows the Bush administration didn't have that. I admire them for the discipline they have.

When Clinton first came in, he wanted to move them over to the old EOB [Executive Office Building] and give them nice quarters, build on some nice quarters for them in the old Executive Office Building. And they fought it, because they wanted access in the pool, right in the West Wing. And they caved in. It's probably smart not to go to battle with the press. They wanted to be able to come into the press office, right next to the press pool, and badger, rather than call them on the phone or try to get them. In retrospect, it probably would have been smart to do that.

They're the only outside group that has offices in the West Wing.

In the old days, they had offices because there were five of them. In [Calvin] Coolidge's day, there were five people in the White House press corps. I'll tell you a great story. I'll just digress for a minute. I'm at lunch one day, and I'm sitting across from a gentleman, and I introduce myself. I said, "What do you do?" He said, "Oh, I'm retired." He must have been 80 or 90. This was a long time ago, so he's dead now. I said, "What did you use to do?" He said, "Well, I worked with the press for many years." He was with AP [Associated Press] or UPI [United Press International], I forget which one. Then I said, "When were you there? Who was President then?"

He said, "Coolidge." I thought, Whoa, you are old. I didn't say that. I said, "What?" He said, "Yes. I was in the press pool when Calvin Coolidge was President." That did get my interest. He must have been 90 years old in 1990. So I said, "What was it like?" He said, "Well, there were five of us. When the President wanted to give a press conference, he called the five of us in around his table in the Oval Office to tell us what he wanted us to hear. And then we'd go out and print it, or put it on the radio and print it. Mainly it was print."

And he said, "We traveled with the President whenever he traveled. One time, we went to the baseball game with the Washington Senators. And President Coolidge went with Judge Kennesaw Mountain Landis, the first commissioner of baseball. A police car was ahead of them. Then there was the President's Pierce Arrow. Then behind them were the eight of us in one car, which had--these cars you've seen with three layers. And that was the whole convoy. We went to the ballgame." He said, "Some guys sitting next to us saw us coming and said, 'Oh, here comes the President and his Cabinet.'"

They went into the ballpark. Judge Landis and the President sat in row one at the old Senators' ballpark, and the press sat in row two. Now, that was the press corps when Coolidge was President. What we have today is 250 to 300--more during an election year. They've got their own airplane. They've got their own buses.

And don't forget, the lead newspapers in that pool are liberal newspapers. The Washington Post and the New York Times--which are the two leading newspapers in the pool--are both very liberal newspapers. And people in that pool tend to follow the lead of the two liberal newspapers. You would be amazed to see the stories come out about something on the front page of the Washington Post or the New York Times, and the sheep factor will follow it in newspapers all over the country. And it may not even be true.

What about Congress? You've mentioned your oversight committees.

One of the reasons I had any measure of success was I had a great relationship with Congress. Although I had never been an elected official, I had Galen Reser, who had been on the Hill many years.

Your congressional affairs person--

He told me, "You've got to get along with these guys," and he devised a program for me to get along. The program was simply go up and meet them, spend time with them. We instituted a series of breakfasts over in my office, where I'd have breakfast with the leaders, the ranking chairman and minority members of each of the committees. They'd come over on a regular basis. I'd go over there on a regular basis. I'd sometime have lunch with them. I'd go to the Republican caucus whenever asked, or even when not asked.

For instance, we got a major piece of aviation legislation passed in 1990, which dealt with noise issues, which was a big issue. It also dealt with capacity issues, and it got PFCs [passenger facility charges]--the ability to tax passengers to build facilities. That legislation would never have passed, I'm a Republican--it's a Democratic Congress. We developed it. We pushed it, and I got it through because I had a great relationship with Senator Hollings but, more importantly, with Senator [Wendell] Ford, who was chairman of the aviation subcommittee in the Senate. He and I were good friends. We still are good friends. On my way back from a meeting in Tennessee, I stopped in Kentucky when he was on recess, spent a day with him, talking to him about his family, his home, and everything else. We reached a deal that day, off away from Washington--

These were mainly the people in Congress who had to deal with transportation issues?

Yes. I interfaced also with the leadership, but less of that.

And you obviously had to work with both Democrats and Republicans.

Yes. But Democrats chaired the committees, so I really had to work with the Democrats. But it wasn't nearly the amount of animosity there is today. Towards the end, in '91 and '92, the animosity got great. I think Senator [George] Mitchell, who was a very partisan--very competent, but very partisan--majority leader, set the tone in the Senate. And I think, frankly, [Newt] Gingrich, when he took over, set the confrontational tone in the House. Now we're into confrontational politics in both the House and the Senate--really bad in the Senate.

When we solved the national rail strike, that was in my jurisdiction because it was rail, but it was mainly a congressional thing. Congressman [John] Dingell was Chairman of the Commerce Committee in the House. He and I got along. Our wives were good friends, got to be good friends in Washington.

He wasn't easy.

No, he wasn't easy. The first time I met him, I was scared to death of him. I was at one meeting, I remember, I'm saying, "Whoa." This guy just ripped me from one side to another, and I hadn't done anything. I hadn't even taken the job yet. But his bark is a lot worse than his bite. He's a great guy, and we worked on a lot of matters together. We listened to each other, and we got some things done. I used to go hunting with him and spend time with him. I enjoyed being with him. They're good people. I didn't do it just for the job. I didn't know anybody in Washington, and these were good people. I might not vote for him, but that doesn't mean I can't like him.

Rostenkowski is somebody you knew--

Well, I knew Rostenkowski well, because we worked together. When I was U.S. Attorney, I'd worked on healthcare fraud, as had he. He was from Illinois. He was instrumental in trying to get me retained as U.S. Attorney, even though he was a Democrat. Rosty and I were close. When I was in Washington as U.S. Attorney, and when I came out to Washington, he and I would go to dinner and talk about politics until one in the morning. I knew him very well.

I didn't know Dixon and Simon that well. I got to know Dixon better. But none of them were on my committees of jurisdiction. Congressman [Norman Y.] Mineta I got to know very well. [James] Oberstar--we had a great relationship.

Was Rosty somebody that you relied on for--

I didn't need him that much, but mine mainly were jurisdictional issues within the committees. I needed him on the PFCs. But he wanted the PFCs, too. If it were not for Rostenkowski, we wouldn't have gotten passenger facility charges through the House Ways and Means Committee, where it had to go. They wanted it for Chicago, and I wanted it for the nation--and Chicago. In that order. Maybe equal.

So the Democratic majority didn't make all that much difference to you in your effectiveness on the legislative side.

No. I only got frustrated on one or two things. That was about it. DOT [Department of Transportation] was in a horrible building. It had all kinds of problems, and our lease was going to be up, and I wanted to build a department building. I was going to build it right near Union Station, between Union Station and the Judicial Center. I was going to take those air rights and build a million square feet, a transportation hub. It would have been a great building, consolidate everybody. I had it moving along pretty well.

Then it got sidetracked, mainly because CSX owned the air rights, and they thought they'd be worth more to them, rather than the government buying them. As it turns out, they're still fallow, so their strategy was wrong. The railroad fought me on it. They said they weren't, but they were. It just wasn't a high enough priority, and I wasn't around long enough to do it. But that was really the only thing. And Congresswoman [Eleanor Holmes] Norton from D.C. didn't like the idea. So she put the kibosh on it, too. Other than that--it still was a good idea.

National transportation policy. Specifically, I'm interested in not just the development of that, but the idea of squaring a generally conservative political philosophy with a very activist approach in using the government in that area.

The biggest problem was with not calling it a strategy instead of a policy. I always thought we ought to have a framework to operate under, especially as we went into the highway re-authorization bill. I had done it at the RTA [Regional Transportation Authority]--define our needs and then talk about how we're going to meet them. So I developed this national transportation strategy, quote "policy." And, obviously, the name immediately set off all kinds of fires--the word "policy." It looked like we were getting away from the free market and determining what the market should be. So that meant resistance from the White House.

Of course, the White House would argue and OMB would argue they neutered it to death. But there was a lot of give and take during those days. It achieved what we wanted to achieve. It laid out a framework. If I had called it a "strategy," it probably wouldn't have had near the flack. But buzzwords are important in Washington. By calling it policy, I ended up, I think, to some degree creating more problems.

Bob Mosbacher, early on, was accused of moving toward industrial policy, and he had to backtrack.

Right. Well, anything you did along those lines--that was mainly John Sununu. John was very conservative, and John felt very strongly about that. I'm sure you know by now, he and Dick Darman ran the White House, and they reached an alliance with each other. Dick would support John on reining in the departments on policy, because he could do that out of OMB, and John would support Dick on financial structures and how we're going to finance the government. That was the alliance that the two of them had. That, by the way, was the President's philosophy, too, and it basically was my philosophy. I didn't have any problem with it. I'm certainly not a pro-government person, nor am I an activist. I like to get the job done, but I wasn't pushing anything that dramatic.

And you could make a principled case, consistent with conservative philosophy, that infrastructure was something that government ought to do.

That wasn't a problem. The problem was how you'd allocate. It was really what our needs are and how you allocate the resources you're going to have. And that, going into the ISTEA [Intermodal Surface Transportation Efficiency Act] was important--the national authorization was the important part.

It was the allocation.

It was mainly what policies we were going to have to make the most use of the resources that we had, which would have built an infrastructure that would allow the free marketplace to use it.

Can you tell us a bit about the conflict over the use of the trust fund in this regard?

That always was a problem, from the day I got there. What had always happened is that the government, with all these restrictions on financing and budget, would take more money into the trust fund than they would spend. It really wasn't a trust fund. It was taken into revenues, and they needed it for budget purposes every year. Once you got on that treadmill, you could never get off.

The appropriators always wanted to do that, because they needed the money. The authorizers always thought it should be pure and should be taken off budget. That was a constant fight that was never fully resolved. How it got resolved is, towards the end, people started agreeing to put a certain amount of money to spend and authorize at a certain level. We authorized and spent more money for transportation the last year--after the ISTEA bill--than we spent in the next six. Finally, they caught up, towards the end of the Clinton administration. But we had a good portion of that authorized and appropriated. And then they backed away from it, as they got into their budget priorities. It was interesting. Even though they're supposed to be free spenders, we spent more on infrastructure during the Bush years than they did in the first six years of the Clinton administration.

Getting back on that and other issues with respect to Congress, you mentioned that there was a change--you thought Mitchell, and you also mentioned Newt Gingrich, who was almost a rebel in the ranks, it seems.

Yes, he was. I think sometime, maybe from the beginning, around 1990 to '91, Mitchell decided that they should try to take over the White House as well, and that we should do everything we could in Congress and the Senate to make that happen. It probably was when they passed the budget bill in '90. That's when he really did it. Frankly, he's very smart, a very talented individual, and he set it up for the President to fail on his pledge to the American people, "I won't raise your taxes." He demanded that they put that on the table before they went out to Andrews [Air Force Base] to debate the budget in '90, and Darman convinced the President to put it on the table. In retrospect, that was a mistake. Would it have made a difference? I don't know, but it was a mistake, and most people knew it. Gingrich knew it. Gingrich refused to support it.

Unfortunately, I think it was used against the President unfairly. I was not deeply involved in that. That was over there, and I'm over here. But that's what, in retrospect, I saw happen. I think that was Mitchell's plan.

Started out that way.

It started out that way. Mitchell knew what he was doing when he was getting the President to put taxes on the table, and it was more than just to generate revenue to support government. It was to position him and undercut him in his conservative base. Unfortunately, the President didn't see it coming, and his advisors didn't see it coming either.

Was he disserved, then, by his advisors in that scenario?

Well, I think that, in retrospect, it was a mistake. Now you can argue we needed the money, but I absolutely believe that if the President had stood up before the American people--in front of the library at the Smithsonian that's closed--and said, "I'm upset that this building is closed. I love the Smithsonian like you do, and I love our parks, and other things. But I made you a promise and a commitment that I would not raise your taxes, and I'm not going to raise them. Now, if they want to raise them, and they have enough votes to override my veto, that's the way the system works. But I'm not going to break my word to you, to the American people. I'm not going to do it." And I would have done a week trip to go into parks and carried that message all over the country. They'd have caved in a week. Congress could not have taken that heat. But he wasn't advised to do that.

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But Gingrich kicked the traces on that one, too, under Bush.

Oh, under Bush, he wouldn't go to the meeting and everything else.

Then, you began to hear Bush was a traitor to the cause--

Not working together. Right. Exactly right. Okay, that's exactly right.

That came from Republicans.

That came from Republicans. A lot of people say that if [Lee] Atwater had been around, that never would have happened. I don't know if that's true. I believe it would have happened, because I don't think Atwater could have rolled Darman and Sununu on that--maybe Darman. John relied heavily on Darman on economic finances of government. And so did the President.

They were key players on that.

Yes. Darman was very key on the budget, and he was over there cutting these deals with [Robert] Byrd. Darman is a pragmatic person. Government is functionaries. He doesn't go in with any ideals that he believes in. He executes policy. And his job is to get the job done, and he didn't see it coming either. He's not a politician with political instincts. They thought they could get away with it. And the other thing is, because Reagan did it and got away with it, they thought they could do it. But Reagan didn't make a promise, "I'm not going to raise your taxes." And because Reagan had so much else going for him as a conservative, they weren't going to undercut him anyway. Why didn't they undercut him, instead of Bush?

Well, for one thing, they called it "revenue enhancement" or something.

You're exactly right, but they did it, they raised the biggest taxes. In '86, they had a huge one.

How did this play out electorally? If you irritate the conservatives in the Republican party, and it's 1992, and you've got [Ross] Perot, who's talking about balancing the budget, how did this hurt Bush in '92, electorally?

Oh, my God. That moves us into that last year in the White House.

And it is lunch time.

[BREAK]

There are a number of things that we didn't touch on. Maybe there are some things that you want to talk about: negotiating airline policy, open skies agreements, safety regulations, 1991 Surface Transportation Assistance Act.

The big part of the Secretary's job in this administration was obviously shepherding these airlines through some very tough times--not as tough as they're in now, but very tough times. There were some ownership issues and ownership changes that you were required to pass on, as far as financial fitness. Of course, everybody and their brother were lobbying you on them. We never would get any lobbying from the White House. That was one thing this White House also understood. When you were operating in a regulatory mode, they never interfered with you, never tried to interfere with you. Never once did I get anybody calling me on any attempt to influence me on any regulatory issue, especially as it applied to a particular party. So you were pretty much on your own.

The big issues for the airlines were, number one, we were still in a bilateral negotiation stage on airline agreements in various countries. All these airlines wanted to get into various countries, and there were only so many that could get in. So it became incumbent upon you to pick which ones get in and which ones don't. The career people go through a very thoughtful and detailed regulatory process. Usually they make a recommendation, and it comes up to you to make a decision. It's like Lincoln and his appointments: You're going to have nine enemies and one ingrate. But it clearly was a major part of the job.

I'd hired an assistant secretary for aviation policy who'd been over at the State Department, so he'd been around. He and I decided that we were going to try to break out of this mode of negotiating every few years on an access here and an access there and try to say, "We'll open our skies. You open your skies." We'd get into a free market involvement, thinking that the U.S. carriers could survive in that environment. We began that process with Lufthansa going into Charlotte and a few others, where there were no trades, just open access. We began to lay that lynchpin, which now--with the exception of the U.K. and a few other countries--is basically the way they're negotiating. There's free access between the countries. So I think, as far as a legacy of the Bush administration, that is one.

The U.K. is unique and stands out as an exception because, obviously, they have Heathrow Airport. There's not enough capacity at Heathrow. British Airways is very close with the U.K. government. They do not want as much involvement in free negotiations because they would be required to give things up. As a result, we're still in a bilateral process, which is a very painful process with the U.K. It means you usually end up negotiating with yourself before too long, because they don't give much away.

And the Surface Act--obviously, anytime you re-authorize, that's a big deal. It was an especially big deal because it hadn't been done in several years. And the second was, we gave a lot more flexibility in the funding in the Surface Act than we had before, and that was a sea change. This was known as the Highway Act, rather than the Surface Transportation Act. We tried to get a lot more partnerships between mass transit and highway, so they'd link together, and tried to approach it with much more flexibility in funding, with greater matches for people who were willing to do innovative projects. We allowed for more privatization of toll roads and facilities. Heretofore, the national highway system hadn't allowed that. All of that came into play. Of course, we did get a bill--and I think a very good bill, and they've built on it twice since then--with ISTEA and NEXTEA [National Economic Crossroads Transportation Efficiency Act]. We didn't call it ISTEA when we did it, but that's what it was. You had ISTEA, then NEXTEA and then 21T and now they're going to have 23T.

Did you have many interactions at all with Roger Porter?

A little bit, yes. He was the domestic policy advisor. But his role was probably not as great in this administration as it has been in others, mainly because Darman had some very strong feelings on that, as did John Sununu. I think Roger would probably tell you that he was shut out of some things because John and Dick decided that's the way they wanted it done, and John basically just pushed it through.

We'd interface, but not much. That role is only as powerful as the President and White House Chief of Staff let it be. Obviously, when [Bob] Rubin was there, it was very powerful in the economic policy area. But there was kind of a void there. I think it became less powerful when Leon Panetta came in as Chief of Staff in the Clinton administration, and Rubin went to Treasury. I don't think anybody filled it. I think [Larry] Lindsey's trying to figure out-- There's kind of a void, and he probably has a little bit more authority now than the predecessors have had, but a lot of it is because [Paul] O'Neill hasn't yet risen to the stature of a Baker or a Rubin or even a Lloyd Bentsen. It varies from White House to White House as to who is going to be in charge of policy and who isn't.

You had some anti-terrorism responsibilities, and I couldn't tell from the press reports whether that encompassed something other than airplane security.

No. No. It was mainly what we were going to do to tighten up the international aviation system, which we did. A lot of the things that we put in domestically, we'd already put in internationally. But it's a much smaller universe to deal with. Then I would get the foreign airlines to do the same thing. A lot of the steps that are used abroad are now being used in the United States.

Okay.

Why don't I give you a background of the transition to the White House? My intentions were to finish out my job at Transportation after four years, and then think about doing something else after the President was re-elected.

But you did expect to stay for all four years?

Oh, yes. I had no intention of leaving until the four years were over. I wanted to help him through the election campaign.

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And at this point, his numbers were still--

Well, they were coming down by then. In June, they were 90%, but they started to come down. Then, of course, more and more rumors started happening. In December, he had me come over to the White House, and he said he had decided to make a change, and he wanted me to do it.

This is December of what year?

'91. He also said that he had chosen his campaign team, and he wanted the campaign to be run outside the White House. He wanted me to run the White House, and we were going to have this Chinese wall between the campaign and the White House. Boyden Gray, the President's counsel, would decide that. Bob Mosbacher was going to be the general chairman. Bob Teeter was going to be the campaign manager. Clayton Yeutter was then at the RNC, to be the RNC Chairman. That was the structure that was handed to me.

I had not thought much about it, frankly. Obviously, I said yes. We didn't really have any guidelines, other than he did not want a wholesale change in staff. He thought these people were very loyal. He felt that whatever problems they had were a result of maybe not getting along with John Sununu, et cetera. He did not want the staff to be unfairly punished, which is typical of the President, "unfairly punished." I agreed to whatever he said.

Basically, that's how it was approached. The President has been criticized for not focusing on the campaign earlier. It's fair to say that the President was not looking forward to a re-election campaign. He'd been through a number of them. He was doing a lot of the things he thought were important, and the idea of going out on the campaign trail with the frequency that it would require, I don't think was his favorite thing to do. My guess is that until after the war he was too busy. He finally got around to it in December, and in retrospect, that probably was a mistake. The Clinton White House and this White House think about re-election from the moment they arrive in office. Unfortunately, in today's world that's what you have to do. But the President is a purist, and he felt very strongly we would try to divorce the two--the White House and the campaign. That had not been the way it was traditionally done.

Why do you suppose he wanted it that way?

I think he really finds it offensive influencing the decision process for purely political reasons. There were several situations I saw where issues were pushed to him--like the line item veto and issues on ethanol--which clearly would have been popular if he had done them, but his lawyers correctly told him that they would not survive a constitutional challenge or legal challenge and would be thrown out within weeks. He would not do it. His theory was, "If I cannot take a step that will be legally defensible and my lawyers can't tell me I have a legal position to take, then I will not do it."

Right after, when Clinton came in, he took a position on ethanol that got thrown out in the first week. But he got the political punch out of it. Bush did not want to do that. Even though there'd been no scandal, he was also worried, I'm sure, about that kind of image of the White House. He revered the White House very much and the office, and he did not want to see it tainted. He thought a re-election campaign would do so.

I guess this was probably his idea alone. He came up with the idea that we'd keep it out. Both Teeter and I reported to the President. I was supposed to run the White House, and Teeter was supposed to run the campaign. Well, that was destined to not work from the very beginning.

Number one, if he'd said, "I want you to be my national campaign manager," I would have said, "I'm not the right guy. I've run one local campaign. I can run your White House pretty well for you, and I understand bureaucracy. But I am not a Lee Atwater or a Jim Baker." But that wasn't going to be my job. That was made perfectly clear. You execute what they tell you to execute. That became immediately a major problem, because Teeter didn't think he reported to me. They accused me of being pretty indecisive at the White House, and I would accuse them of being pretty indecisive at the campaign. Because my job was--that's my style--"You have the authority. You make the decision. You tell me where you want them. I'll put them there."

Mine was not to devise the campaign strategy. I hung on to that for a long time. They would come in one day with this and one day with that. They were driving the presidential scheduling people nuts, because they could not tell us where they needed to be and why.

Now part of that was not their fault. I went in in December, and I saw the polls. They handed me the polls. I went in to Quayle, and I said, "Mr. Vice President, have you seen these polls? We're at 40%. We've deteriorated from 90% to 40% by December. This is very serious." I had no real idea. I'd read it in the paper, but I'd never really seen those kinds of numbers.

We were in DEFCON 4 [defense condition 4: normal, increased intelligence and strengthened security measures] when it comes to political campaigns, with eight, nine months left to go--actually ten. I came in on the 23rd of December. I stayed behind to try to get the White House staff in order. It also became apparent to me that the White House staff--even though the President loved them--were burned out. Some of them had been there from the Reagan years and the Bush years. We were at 40% in the polls, and the parking lot on Saturday morning you could have shot a gun through and not hurt anybody. They'd quit working. They'd become demoralized for a variety of reasons.

Was the President aware of this?

I don't think so, no. It's hard for me to understand. I knew he knew the staff and John had problems, and there was a lot of frustration. I think he probably knew some good people had left. But the staff was not as strong as it could have been, and it was not as energized as it should have been. And that's, by the way, understandable. But the problem is, that isn't acceptable. It may be understandable, but it's not acceptable. Everybody should be in there working as hard as they can in this period of time.

My questions are not questions of a skeptic, but of somebody to whom it looks kind of puzzling. Why would the President tell you that he didn't want any changes in staff when he was in trouble?

Oh, I think he was being protective. I think he was afraid. He believed that these people had worked hard for him, and a lot of their problems--whatever their problems were--were a result of whatever was going on with John Sununu and Dick Darman. I'm sure he was aware of those frictions with the other staffers, and he did not want them unnecessarily punished. That's the kind of guy he is.

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How could it be that he wouldn't want to save himself in the re-election effort?

First of all--maybe this is denial, maybe it isn't. First of all, even in December, he saw no candidate on the scene who was willing to take him on. He didn't believe Clinton was even a viable candidate. So he said, number one, "To beat me, they have to have somebody, and the big horses have decided not to run."

That was early.

That was December. That's why he delayed making the campaign announcements. After that he said, "The American people must understand. I've done this, this, and this, and they'll give me credit for it." Now, all of a sudden, right after the first of the year, out come [Pat] Buchanan and Perot.

Let's take Buchanan first. Both of them come out. All of a sudden we find ourselves, in January and February, fighting a primary opposition in New Hampshire against a TV commentator. And the polls are showing that the TV commentator is doing pretty well up there. All of a sudden, we've really got a problem. Then, all of a sudden, Ross Perot comes out. Then Ross Perot gets out. Then Ross Perot gets back in again. For the first five months, we're fighting a war within our own lines. We can't even get the troops riled to go out to the front. And we're spending tons of money.

At the same time, we have a dysfunctional campaign/White House organization. It was never structured right. I'm saying, "I don't know where he should go. You tell me where you want him. You're the campaign manager. I'll get him there. I'll get the advance and so on." In the meantime, I'm handling the problems that are going on regularly with government. Plus, Darman is not happy, because he doesn't have the relationship with me that had with Sununu. I'm not standing him down, I'm just--you know, it's a different relationship. And I probably said a few things early on, out of naivete, that I wouldn't say today. I'm not accident-free. I made some mistakes myself. But the biggest mistake I made was not going to the President about one week into it, or two weeks into it, and saying, "This is not the right structure."

But I didn't have the confidence to do that. I didn't have the confidence to say to the President of the United States, who had just set up this structure, "Mr. President, this isn't going to work the way it is." And I didn't see it coming either. I thought they could tell me what to do and I would do it.

Heretofore, every campaign had been run by a Chief of Staff or somebody in the White House who had responsibility for the campaign. I had no authority to give Bob Teeter orders. I guarantee you, in the next campaign, Karl Rove will have authority to give whoever's running the campaign--who will be Ken Mellman, his ace aide--"Ken, you do this." And Karl will be doing all of the strategy. That's what Baker did for Reagan. But that was not the way it was set up. Although, later, it seemed like it was expected that I would do that, even though I didn't have the authority. So I was being criticized for not making the decisions.

Finally, I tried to take it in and get some decisions, but I'm still taking advice from these people as to where to go. They've got the polling. And I'm not getting the right direction. We go here. Then we have to go here. That's partially because we have Buchanan fighting us. We have Perot fighting us. We don't have time to breathe because we've got these primary fights we didn't expect in January and February.

Finally we get through that. Then we get into the Perot thing. By then we'd spent a lot of money, but the main thing is we'd taken some body blows mainly because he'd raised taxes. You can cut through all the other stuff. It mainly was, he raised taxes. He broke his pledge. If there was one thing that hurt us more than anything else, it was that. And the President was not willing to admit that that was a mistake.

The theory was--and I think correctly--in order to get beyond that, we had to acknowledge that. We weren't going to convince people out there it wasn't a mistake. We either had to fight it out, tough it out, or say, "It was a mistake. I shouldn't have done it."

Who did it hurt you with?

Oh, the conservatives. It hurt it with our base. The reason we weren't getting above 40% is our base. When you've got 40% of your base in New Hampshire going to Pat Buchanan, you've lost your base. That's what the Republicans are doing right now. They're building their base in the White House right now. They don't go too far off. They try to go far enough to look like they're reasonable.

I mean, last week, the gun ballistics thing. Here's a perfect example. A sniper has taken out nine, ten people. There is a move to do ballistics, matching fingerprinting from the gun. Now we all know that that can be altered quickly. If you know anything about firearms, you know that can be altered quickly with with files and everything else. So that's clearly not foolproof. But they came out, and immediately the White House said last week, right after somebody suggested it, "We don't believe we should be supportive of fingerprinting of bullets." Why'd they come out and say that? Why did they have to get into it at all, other than to say, "Let's find this guy"? They did that because they were worried that if they said anything other than that, the NRA [National Rifle Association] would go nuts on them. And one of their hard constituent groups--the conservatives you have to keep--is the NRA. So they made a decision to go out in the heat of battle, because most people would say, "Why not?" They didn't want to lose the NRA.

That's the thinking that goes every day, from the day you get elected. That's what Karl Rove does every day. That's what people in the White House, including Clinton, did every day. Bush 43, by the way, has somebody to do it for him. 41 didn't have somebody to do it for him.

You said that you had had an initial meeting with the President about making the change. Had there been, to your recollection, any talk about your making a move like this in advance?

Oh, yes. The rumors were floating around for several weeks, but I had never had any talks with the President. I don't think I had any talks with anybody. I may have had one with the current President. I stayed away from it because I felt uncomfortable. John Sununu was a friend of mine. He'd been supportive of me. I was not out for John Sununu's job, although some people thought I was. I was perfectly happy where I was. I was not looking to take John Sununu's job. I don't dance on graves.

So, you hadn't taken any effort, then, to--

No. None whatsoever. I had never discussed it with anybody. I never told anybody I wanted it. In fact, I denied that I'd want it. I said, "I am perfectly happy where I am."

Why do you think he chose you for this position?

He wanted someone who was close to him, whom he trusted, who was totally loyal to him. I think he probably thought Bob could run the campaign. I could clearly run the government function. I don't think he looked at me as someone who was going to run the campaign. Nor did I. Nor did he think he needed that. He believed the structure would work. There were differences between Bob and me where we'd have to go in to see the President. That is unheard of in running a campaign. But that's because Bob reports to him, not me.

How did that work? You said, "The campaign is their job. Let them make the decisions. I'll make it happen." So what sorts of things would be a conflict?

Mainly, where to be. What message should you be on? The message and the place. That's what campaigning's all about: message and place. You tell me what message you want to be on for the week, and you tell me where you want him to be, and I'll try to convince him to go and get the schedule arranged so we can do it. But you tell me what to be. We will make sure the message coming out of the White House is the same message you want out of the campaign. We won't walk on your message.

When you had been approached earlier about the possibility of taking the Attorney Generalship, you had said that part of the reason you didn't want to do that was that you felt you could be of some service to the campaign, and you couldn't do that from the Attorney General's position. When you're moving into the Chief of Staff position, though, there is this Chinese wall that you've described that would have you apart from the campaign in that position, and you did accept that position.

I would still be involved in the campaign. The Attorney General can't make a political speech. He can't have a political thought.

Legally, or just--?

Immediately. Period. He can do no campaign functions. He cannot discuss campaign strategy. I did not want to be there. Also, deep down, I thought there was a very good candidate in Bob Barr who could take the job, and I recommended him. I wanted to be in the game somehow.

And from the Chief of Staff's office, you could do that. But you were more of a directed player than a directing--?

Yes. Plus, you've got a hole. If the President had come to me and said, "Sam, John's talked to you about being Attorney General. I really want you to be Attorney General," I'd have done that. Because [it would have meant that] he personally had thought about it and said, "That's where I want you." Then I would have done it. Having said that, it didn't come to that. John was feeling him out. I knew he and John had talked about it, and that I was their choice. It was a logical choice. I pushed back, because that's not where I thought-- That doesn't mean I wouldn't have done it. When he comes to you in December, and it's all over the paper, his Chief of Staff is out on the street, his campaign is in disarray, you can't tell him no.

Sure. Exactly.

I don't regret telling him yes, but I regret that we didn't have better results.

At the time that he told you that he didn't want to have any changes in staff structure, did any alarm bells go off in your head, knowing what you knew about the White House, that this could be a problem later on? You've had a lot of management positions in your time, and, in fact, you said when you came to Transportation the most important thing to do--

Yes. I promised him. Did I like it? No. Was I going to sit and say? I probably thought I could work my way through it. I'm sure I thought I could work my way through it. I'm not going to be arrogant enough to tell the President of the United States, "They're my staff, not your staff." Because he said, "They're my staff, not your staff." So I'm supposed to say, "No, it's my staff, not your staff"? I'm not going to get into that with the President. It's unseemly. He said, "You'll have some flexibility." I knew I'd have some flexibility, and I made some changes--made some wrong calls and some right calls.

Right. This appears to be different from the President's thinking about an appointment to a Cabinet position.

Yes, it is.

Now you've got my trust. You do the job. And he didn't lay down any conditions?

No.

Like he doesn't want any changes at Transportation?

He just said, "They're my staff, not yours." I took that message as, "Do not throw the baby out with the bathwater, Sam. This is not their problem. They're good people. They're trying. They're working hard." I knew him well enough to know I could make assessments, and if I had major problems, I could come to him and probably work my way through them. And that meant, when I said Andy [Card] had to go, Andy went. That was a mistake. I should have kept Andy. He was beloved by the White House staff, and he did a good job of scheduling.

The guy I brought in was a great Deputy Secretary of Energy, Henson Moore, but he was not in the right job as Deputy Chief of Staff. I made a mistake there, in retrospect, and I'm sure Henson would agree, wished he'd stayed at Energy. But Henson came over. He thought he was going to be Secretary of Energy. He didn't want to come over to the White House, but I put it on him to come over, because I thought that he'd been in Congress, he knew politics, he would be a good addition. That was not his fault either. He started in a hole as my Deputy Chief of Staff, because he'd replaced Andy. And everybody thought Andy--correctly so--had been a loyal soldier to John, and Andy was beloved. In retrospect, Andy came out fine. He didn't have to go through that year. He ended up taking my old job as Secretary of Transportation, thanks to my support. And he ends up being Chief of Staff. So it worked out fine for Andy. But we would have been better off with Andy there, and should have kept him there.

I can imagine another President who would have felt that he needed to lighten ship at the juncture, in the situation he found himself. I would have thought that Dick Darman would have been a strong candidate for someone who had outlived his usefulness to the President, just from a purely pragmatic calculation on the part of the President.

Yes, but he doesn't do that. The guy is incredibly loyal. That's a great attribute, and maybe it's a great failing, too. The list could include several people. But he didn't want to do it. Part of it is because he thinks it sends the wrong signal, and it's not going to make a big difference. And, late in the campaign, he may be right on that. You make it a year ago, not now. All of a sudden, you make it in December, it's hard to recover. I think that's a very hard call. But he's just not built that way. So he decided to ride it out. I don't think he or I or Bob Teeter figured out the fallacies of the system and that it wouldn't work. It might have worked, had we had different personalities over at the campaign. If Jim Baker had been over the campaign, or Lee Atwater, it might have been different.

On the other hand, there was constant frustration between the campaign and the White House about who they could talk to and when they could talk to them. We had the funnel--a process--that everything had to go to Boyden Gray before anybody in the campaign talked to anybody in any Department agency.

Why was that?

That was to keep the agencies pure. Therefore, if a campaign person who was in charge of the campaign wanted to talk about a position that the campaign was taking and what the Department had done, they had to go through the funnel, through the General Counsel's office, to get permission.

How come Boyden Gray was the funnel?

Because he's the lawyer and he had the President's confidence, and he was to protect the integrity of the Department. Bush is a man who not only has respect for the office, but he is also a man of extraordinarily high integrity. And he did not want to see the office trashed or compromised in a campaign, like he had seen in the past.

You think his experience in 1973-4?

Yes. He did not want to see it. He wanted to see it pure. He wanted to leave the office of the Presidency in better stead on integrity--

Well, he's being criticized later in the campaign by Clinton and, in the general perception, that the economy is not in good shape and he doesn't give a damn. When it comes to a question like that, it would seem that it would be possible to come up with some substantive policies or initiatives.

Now, let's talk about that. You're right. Let's go back. First of all, Mike Boskin--there is some question as to how--I was not there. What I'm about to describe for you is only hearsay evidence. Mike Boskin told me after I got there that he felt the economy was in worse shape than the President knew, and he was not allowed to go in and tell the President.

That's in Bob Woodward's book, in October '91 is when--

Yes--right before that. And he threatened to quit if he didn't get to go in and tell the President how bad it was. He was being kept from the President because John and Darman did not want him to know how bad it was. I don't know that to be true. That's what I was told. It is clear that the President knew the economy was in trouble, but none of us knew-- First of all, at that stage, he did not believe, from a policy viewpoint, that there was a whole lot you could do between then and November. He thought it was coming back on its own, which, by the way, it did in the third and fourth quarter of '92. It just didn't come back soon enough.

It would come back on its own, and we were going to have to ride it out. There were not a lot of things you could do, and we weren't going to do things like cut the budget with line item vetoes, or things that were gimmicky. Occasionally we did things that were allegedly gimmicky, and Jack Kemp went on television and called them gimmicky. When we accelerated tax refunds--

You couldn't even get away with that.

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We tried to come up with a series of things, but they were all small. We tried to package them into the State of the Union and everything else. They were still small. They were not perceived to be able to do enough. The caring on the economy--everybody says, you've got to get out and the President has to give a speech, "I care." The President has to get out and say, "I care. I feel your pain." That was not easy for him to do. Although he felt pain for everybody, articulating it was not his strong suit. He was not as effective a communicator as Reagan or Clinton.

We tried to do that on a number of occasions, with mixed results. But every time, in the meantime, we're trying to say that, we don't even have a clear passage for a message, because we've got talk about the tax increase. Beating us up until spring is Buchanan, and then beating us up after spring until summer is Perot--saying all kinds of things. We can't even get a clear field to put the message into. We could stay on message a lot easier than we were allowed to stay on message. Extraneous things would come in.

By then the press was in a feeding frenzy. He'd had this great victory in the Gulf. It was now George Herbert Walker Bush's time to take some slaps. And so they did. It started with Ann Devroy, bless her soul, from the Washington Post, and Andy Rosenthal from the New York Times. They were looking for ways to prove he was out of touch. Andy Rosenthal wrote an article on Sunday morning that the President did not know what a scanner in a food store was like. Now, the truth be known, the device that was presented at that show was a much greater state of the art thing that had never been introduced to the field. Anybody would say, "Oh, my God, you've got a device that can do that?" Andy wasn't even there. He didn't even see the interface. He wrote it from what someone else told him. He was back in the press tent in the event. He didn't even give us his presence for this tour.

He wrote that, and every newspaper in the country picked up on it. Bush is out of touch. He doesn't even know what a food store scanner is. We brought the scanner in and showed the press and everything else, but it was too late. The other papers fed off the front page story of the New York Times, and, boom, he's out of touch. There were a number of incidents like that.

In addition, the White House leaked like a sieve at that time. For years, they had been scared to death to say anything to anybody and, of course, the Washington press corps' job is to get people to leak. The place started leaking like a sieve. People quit thinking about the President. They're thinking about themselves and making themselves look good, even though the President suffers. Nobody understood that. So they're talking, all kind of cross channels between OMB and the press, and the policy office and the press, and who knows who the worst leakers were. But they were all, "Well, I wanted to do this, but the campaign wouldn't let us," or "The Chief of Staff stopped us from saying this." In that regard, they didn't have the loyalty, or the brains, or the maturity to understand you disservice the President in a campaign when you say anything other than what you're supposed to. This is not about building your own reputation with the press, who will forget you the day you're gone, and you'll be an asterisk in the history books.

It was only probably half a dozen people, but it was critical. Then when things started going south, the campaign started blaming it on the White House, and me in particular. "He can't make a decision." I do not fight back. I do not leak. I do not play the press game. I recognize that if I start defending myself and blaming the campaign, that's going to hurt. So I just take the bullets, and I took plenty of them.

In retrospect, after 30 days, I should have said, "This doesn't work." I did, about six months in. I said, "You've got to get Baker back in here, or somebody, because I can't do both these jobs. You've got to get somebody in here who can run both." He finally eventually did. But he didn't want to make a change there, either. He didn't want to change the structure. So he spent an enormous amount of his time refereeing. Because then, all of a sudden, they're not telling us where to go. And I got the scheduler, Kathy Super--who is very close to the President, because she does his scheduling--telling him, "They tell me one thing one day, one day the next. I'm going nuts." So he's getting feedback, and he doesn't know what to do about it. That's because the process was set up wrong. Nobody jumped in to say "change the process" 30 to 45 days in. We were too busy, frankly, fighting Perot and Buchanan for 60 days to even get into it if we could. That doesn't make it right. That's just my perception of it.

How long before Buchanan was out of the race?

I think he was out in March, maybe, early April. He had a big win. His big move was in New Hampshire, and then he started petering out a little bit in South Carolina.

But the damage had been done by then.

The damage had been done. He's "the conservative commentator," and he's out there ripping the President as being too liberal. By then we're trying to talk about how we get his base back. So now we spend all of our time getting our base back, rather than getting to the middle. Because if you don't have your base protected, you're not going to do any good in the middle.

You mean because the base is going to stay home on the general election day?

Stay home, or they'll vote for a third party candidate. Perot got 19% of the vote that year.

But Ross Perot is talking about balancing the budget. That was his big thing.

He was perceived as a conservative alternative. People say Ross Perot--what's the first thing you think? He went into Iran and got his people out. That's the first thing I think of Ross Perot. Maybe the first thing I think is he's a salesman with me at IBM in the '60s, then he left early. The second thing I think of, he's very close to his son, and his son flew a helicopter around the world, and his father helped him by positioning tankers all over the world to land him on. The third thing I think is, he went to bat for his employees and sent mercenaries in there to get his employees out. And he ran ads. To me, he's a conservative, and I think he was perceived as a conservative.

Did you get a sense about what the root of his animus towards George Bush was?

Yes, I did, and I'm trying to think of what it--

Prisoners of war? Was it prisoners of war in Vietnam? The missing POWs?

I'm missing it now. There was something that Perot wanted to do that the Reagan administration did not want him to do, and Bush had to carry the message to Perot.

As I heard it, Bush offered, because he knew Ross Perot. They were friends.

Yes. I think that's it. It became incumbent upon President Bush, because he knew Perot, to tell Perot, "We don't want you to do something" that Perot wanted to do. He thought it was Bush personally telling him. He's different. Ross Perot is different, and we all know he's different. He's paranoid. He saw that as a personal affront, and he took it as a personal affront. He had people watching his daughter--I mean, come on. I think that was the main thing. Bush had to deliver a message, and it backfired on him. But Perot wanted to be President. He didn't run the race because he didn't like President George Herbert Walker Bush. He thought he was more qualified to be President. He has a large ego. He thought he would be more qualified than Bush or Clinton.

Very few politicians like to fire people, and, in Bush's case, you have--

Very few Presidents, you mean?

Very few Presidents. I don't know of any politician, having worked at the state level. Governors don't like to do it. They like to please people and not to make them unhappy. But the way that most successful Presidents and politicians deal with this is they have someone close to them who's competent to help them make a decision, when somebody has to go. In Reagan's case, Nancy Reagan often was a source of this kind of advice. I'm wondering if you ever got the sense with George Bush, if there were people around him whom he trusted enough that he might have been able to rely on to tell him, "Darman has to go"?

I don't think there's any question that, when the economy started going down, there were plenty of people speaking out, strongly, to President Bush directly--"You need to make a change in your economic team"--including Brady and Darman, including the current President, who made no secret about it. He was adamant about it. I was down at some campaign event, and he pulled me aside and basically said, "You're not doing your job, because they're still there." That's how strongly he felt about it. I'm sure there were plenty of people who were telling him that, yet he still was not comfortable doing it. There were also plenty of people telling him he ought to get rid of Quayle and put somebody else on the ticket, and he didn't do it. The campaign had to pull a ruse to even get a poll done.

On the Quayle question?

What'd the polls look like?

The polls showed that it wouldn't have made a difference with anybody but [Colin] Powell. They had Baker in there, a bunch of people. He wasn't going to do it anyway, but they presented a poll to him in Wyoming that they had just taken without authority. They just did it on their own. They thought it would be a big difference, and they showed it made about a one or a two percent--within the margin of error--difference, on anybody but Powell. Powell may have been five points, and Powell wouldn't do it anyway. So that went nowhere. He just didn't feel comfortable.

He also thought the economy was coming back. He thought these people had served him well in a very difficult situation, and that you shouldn't blame them. This was the natural up-turn and downturn, and it would be coming back, and the people would understand that.

He also felt very strongly that the American people would not elect a President with the character of Bill Clinton. If I heard that once, I heard it fifty times: "I cannot believe that the American people will elect someone who is what he is." By the way, if you look at what we said about him during the campaign and the risks, they all turned out to be true, every one of them. If you had said, "If you take the ten things that you have to worry about Clinton, and you put them next to the ten things that we worry about--" Not his strengths, because I'll give you his strengths. His strengths turned out to be what his strengths were, too. But his weaknesses were what they said. We knew what we were getting. We didn't want to believe it at the time, but we knew the pluses--we knew the good, the bad, and the ugly on Bill Clinton, and it turned out to be true.

He believed that would be enough. He just couldn't believe that they would vote for a person like that. He wasn't alone. I remember in June when Gennifer Flowers came out on national television. We watched it in my office in the White House, and all my staff said, "He's dead. Clinton is dead. If she's telling the truth, there's no way he's going to survive this." I go outside the front gate, and Cokie Roberts is out there, and we both agree: It's over. Six months later, he's raising his right hand, and I'm on the train to Chicago. A lot of people didn't believe it.

He also believed the economy would be coming back, and we'd ride it out.

There's a question, where the economy actually is and where people think it is--the perceptions.

Right. You could never get that across.

I think perhaps this was one of the problems Darman had. He's looking at numbers, and he has some other reasons for not putting this on the top of the President's political agenda. But I don't think he has an ear for the outside. Lee Atwater had a very good ear.

Well, Dick Darman was, first of all, better prepared than most of the people on the staff because he worked harder at it. And he's very good at working the President on policy issues and everything else in an informed way. So in a meeting of five people, Dick Darman's going to carry the day. After three years of that, the President starts relying on Dick Darman for his analysis from an economic and public policy viewpoint. Darman would probably argue that he also has a great ear for politics. But he doesn't. You're exactly right. He believed that, because he trained under Baker, he could hear all of that, and he could see it just like Baker could. That wasn't the case.

His experience was almost altogether inside the Beltway.

Exactly. And he didn't run for office. He'd never done it. He never went on campaign trips. He was a policy guy, a policy wonk, a very smart policy wonk. Now, John had that. John Sununu was supposed to provide that, because John had run for political office, successfully, in New Hampshire--run the campaign and saved the presidential campaign in New Hampshire.

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Darman and Sununu are an interesting pair in the Bush White House. Sununu didn't know much about Washington, and Darman didn't know much about--

Well, Darman said, "Sununu's the Chief of Staff. I'd better get along with him if I'm going to get anything done." And Sununu said, "Darman knows a lot about policy. He's smart like I am, and he can be effective." So for a period of time, they were very effective.

Putting aside the personalities, the real mistake--as we look back in history--is that we passed that tax increase instead of standing on expenses. That was mainly Darman, and I'm surprised he convinced Sununu to do that. But once Darman and Sununu convinced him, the President went along because he thought this was the right thing to do for government. There was no one there saying, "This is political suicide." When he said, "But I said this," they said, "Mr. President, Reagan said that, and he did this, and he had a successful Presidency."

It's like anything else. In this last election, they're out in California. The White House decides they want [Richard] Reardon to take out [William] Simon, Jr. in the primary because he'll run a better candidate in the general election. He probably could have gotten elected, too, by the way. Gray Davis spends $10 million, dumping all over Reardon in the primary, and takes him out.

I also believe that the war masked the implications of the economy. We spent $60 billion in about five months in '90-'91. Dumped it into the economy--the trucks, trailers, the railroads. Everybody's building. Most of that was money we'd borrowed from countries all over the world that put into it. Japan had overpaid. We only spent $50 billion, and we had $60 billion. We had to decide who to give the money back to.

You mean for the war, or are you talking about investment in U.S. debt?

I'm talking about the war. We had $60 billion coming into the economy in about three months. All I'm saying is that period of getting ready for the war and the war--with all the money we were spending there--masked the implications of the recession. It might have happened earlier, had we not had the war. Had it happened earlier, we might have popped out earlier. Who knows? Timing is a lot of everything. This Governor's race up in Maryland may be determined by the sniper and gun control. Those are things you just can't control sometimes.

Obviously, in retrospect, if the President had said on May 1 or June 1, when we had the parade--or maybe even sooner than that--in Washington, "We've won the war, now we've got to win the war on the economy, and here's our plan to do it. This is what we're going to do," he might not have lost it the following November. But they coasted from May or June to December, and by then we'd eroded from 90% to 40%.

When you got to the White House, you brought in some new people, and you did some reorganization. Tell us about that.

I brought in Croisant again to try to help me analyze the working of the office and see if we could make it more efficient. That didn't go over real big, because he was a management expert, and the White House didn't need management experts. Probably, in retrospect, I shouldn't have purported him as a management expert. I should have just brought him. But he didn't have any political experience. I just wanted some eyes and ears to do an assessment for me so I knew--if I couldn't make a wholesale change, which I didn't want to anyway--what are the things I could do to make it a little bit better and give me a feel for what people were saying. They wouldn't say it to me, but they might say it to him. And I got good input on that. We brought in Nick Calio to run the legislative office. That was a big plus. I brought in Sherrie Rollins to do some of the outreach. That was also a big plus.

I should have known this was not going to be a good year when he said, "I don't want you to go to Japan with me. I want you to stay home with this transition." He goes to Japan. I'm in the office three days, and he's on national television getting sick over the Prime Minister. That was not a good start. I should have known by then, well, Transportation doesn't look so bad now.

He had a great recovery line, though, on the way back. "Next time, dinner's on me."

Yes. Then I said, "We need outreach. We've lost touch with these constituent groups. We need someone to do that. Let's hire Sherrie Rollins." Ed Rollins had dumped all over the President. They love Sherrie but don't like Ed. I finally convince him to hire Sherrie. She moves into the White House and starts doing a great job reaching out to all these business groups. All of a sudden, I read in the newspaper that Ed has decided to go be the campaign manager for Perot. Now, think of that

With [Hamilton] Ham Jordan.

Think of that. Think of that. Your wife--whom you're supposed to love--is working in the White House for a current President, and you're going to go be the campaign manager for his opponent. She had to leave. She left in tears. I'm looking like the biggest fool that ever walked, by bringing her in. But it was the right move. She was a good candidate. I brought Clayton Yeutter in. That was step up from where we were. First class. So I was able to make a few changes which, on the edges, made the operation a little smoother, a little more efficient.

But the White House staff was not the problem. They would do as best they could what they were told to do. They weren't getting instructions on what to do. I wasn't superimposing my decisions on the campaign, and the campaign was having trouble figuring out what to do because they were fighting fires here or there.

Can you tell us what you were seeing of the operations within the campaign team? You have these three individuals--

Bob Mosbacher, Bob Teeter, and Fred Malek. Mary [Matalin] is there, too, by the way. And I hear from Clayton that Mary is enthralled with James Carville. Everybody's wondering about that, but that was the least of my worries.

But it's not a good scene, either.

It was not a tight organization. Maybe mine wasn't as tight, but theirs wasn't either. Bob was a great pollster and knows politics, but he was not a manager. He's never managed anything in his life. You need somebody over there who could execute, who could say, "This is the process. This is the decision." We ended up having the meetings over in my office at the White House to try to figure out what to do. I, de facto, started convening these meetings, but I don't take the authority and don't think I have it. In retrospect, if I'm going to convene the meetings, all I'm asking for is what my scheduler wants. You tell me what you need from government, and I'll get it for you through the funnel. You tell me where you want him to be, I'll have him there. They would tell Kathy Super, "I want him here." Then all of a sudden, a fire would break out-- "No, he's got to go here." Well, you don't move the President in 24 hours. You need a week or two of planning in advance. They were fighting all these fires all over the place.

But the campaign itself was pretty disorganized, wasn't it? Who was in charge of it?

Bob [Teeter] was in charge of it. But Fred had a role, and Bob Mosbacher had a role. The other thing is, I wanted the communication. We knew we had a communication problem, and the best guy everybody said we should get is Jim Lake. I interviewed Jim Lake, and I said, "They're right." And I must have worked on him for hours and days to get him to come in. He didn't want to come in. People did not want to come in. They saw the White House sinking, and they did not want to come in. Oh, they'll go over and work on the campaign, because they don't have to give up their cushy jobs. Nick did, to his credit, and Sherrie did. But the rest of them didn't want to come in.

It was not a place it was easy to attract people into. Most of the time, people would kill to go into the White House. People would turn me down, turn the President down.

Lake would have been a great addition. A fully engaged Jim Lake, right on track, would have been a great addition. He has gray hair. He's mature. He was in the league of the Mike Deavers, et al., but he didn't want to come in. He could go over to the campaign--because we had a fully funded campaign organization over there. So why not go over there? That's where the action's supposed to be, under this structure. It was not a good beginning.

As Chief of Staff, you were seeing the President on a daily basis. Can you tell us what was on his mind or what was on his agenda during this period when things were looking so troubled?

Well, number one, he's a great optimist, so he thought it would work its way out. He thought the economy would come back. Number two, as Clinton more and more became the candidate, he did not think that people would vote for Clinton over him because of the character issues. Number three, he was sick and tired of all of the infighting--I think he was upset with me because I didn't solve it for him. He was not without reason to be upset with me.

Didn't some of that, though, surface as soon as it became apparent that Sununu was going to have to leave?

No. I think the leaking started because people had been afraid to say anything, and when they thought Sununu was vulnerable, they started dumping on Sununu, unfairly. I think he did a good job for the President in a very difficult situation, and I think he was totally loyal. His interpersonal skills probably leave something to be desired, and he probably offended a lot of people. The people weren't secure enough in themselves, so they let loose on Sununu.

I think the main stuff started when some things started going wrong. The press starts feeding on it, and these people don't want to be embarrassed in the press, so they start blaming other people. Then the leaks started pouring out of the campaign. They had a close relationship with Ann Devroy at the Washington Post, and stories started leaking out. We'll never know the whole thing. The people were trying to cover their own, you know. We didn't do it to the degree we should, and I wasn't as decisive as I should have been. In retrospect, I should have just gone in right away and said, "This is not working. We have to do something." I should have just said, "We have to do something now."

And by the way, we tried to get Baker in earlier, and he didn't want to come. Make no mistake of that. It's not like it couldn't have happened six months earlier, and we couldn't have restructured the thing. From April or May on, the President and I knew we had to restructure the thing. But we couldn't get him--until the President said, "I just absolutely need you to do this." He did not want to give up being Secretary of State, and who could blame him.

Any future career Baker might have had in mind was lost--

He couldn't have gone back. But he did what a loyal person should do: He immediately took charge. He made clear he was in charge of the campaign.

He did everything the President didn't want done when he brought you in, it looked like. Chinese wall--

But then the conditions were, "Well, Mr. President, if I'm coming back, I need the following." "Yes. Yes. Yes." By then, "I've go to do this, this, this, and this." He did absolutely everything. He totally changed the structure around. He did everything. He had the group of six who met in the White House, in the upper Mess room. They decided all the decisions. Kept everybody out. Everybody was told what to do. Basically, [Robert] Zoellick and who was it? [Dennis] Ross, who came in with him?

Dennis Ross came with him.

Dennis came with him. Zoellick came with him. Darman was, of course, in power.

Was [Robert] Kimmitt back with him?

Margaret Tutwiler.

Margaret Tutwiler came back, right. Exactly. They all came back. Darman was back into the loop again, much more than he was before. And I assume that either Fred or Bob came. But they, then, became basically, "This is what Jim told you to do, do it." They became almost irrelevant. He ran it out of the White House. Baker had the infrastructure and the command structure to do it.

The funnel, then, disappeared.

Oh, the funnel disappeared totally. I wasn't there then.

It couldn't have worked if you had the funnel.

It was no funnel. It was, Baker says this, do this. Baker says that, do that. He gets a bad rap, a little bit. I think he gave it his best in a very difficult circumstance. But we're in September. Of course, who knows if we'd have won? Then Lawrence Walsh comes out, right on the eve of the election, with this decision on Iran-Contra. If they had any momentum--which I don't think we really did--that, in the week before the election, knocked it. That was just a special prosecutor who stayed way too long, and a very partisan former Assistant Attorney General Criminal.

Would it have made a difference? I don't know. People vote their pocketbooks. You can say the die was cast by December or January, because by then you had Perot and Buchanan. Had you been stronger economically-- The other thing is, the banks have stopped lending money. So all his business constituency, from California and other places, is down on the President because you can't get any money. Here's another example--you have to do something to get the Fed to loosen money.

Now, we'd just been through the savings and loan crisis and paid off $100 billion-plus in funding, and he wants the President to tell the regulators to start lending more money. And if you won't do that, you've let us down. So all of a sudden, the poor President goes out and gets with his major contributors, and they say, "The economy stinks. It's your fault. Can't get any loans. It's your fault." So the answer to your question is, he is not one happy puppy when we go into the autumn. He's a positive guy, but every day he's getting reamed by somebody. "You do this, you do that." As am I.

Actually, firing somebody inside government is kind of a relief from this. Is that all I have to do? Fire somebody? That's easy compared to this. Give me some more people to fire.

The news from a lot of the business people when the money dried up was coming at him very early and very forcefully. It became difficult to raise any money.

Oh, yes. We had trouble raising money at the end. Our fundraisers couldn't go. People wouldn't come up with the money. They were all down.

Another issue, we had this guy over at the National Endowment for the Arts. I think his name was [John] Frohnmeyer. He had let all this art out that the conservatives didn't like, and nobody did anything about it. We even had the cultural conservatives down on him, because we have this guy over there--I don't even know how he got there. I finally had to call him in. That became a big deal, to let him go.

Frohnmeyer?

Yes. That should have been a no-brainer. We had torpedoes coming at us from about nine different directions. But the President was very tough. He got up every day, put his game face on, went out there, and acted in the best way he could. I think that people thought he didn't want to win, but he did want to win. He may have left that image, but that wasn't because he didn't want to win. That is just wrong.

Did he really want to run? Or was that a real problem for him?

I think he probably thought, After all this, with all I've done--the economy is coming back--why do I have to get down in the trenches in a primary with Pat Buchanan? And schlep up to New Hampshire for ten days, to take on Pat Buchanan? Why do I have to spend time worrying about Ross Perot? Neither one of them is qualified to be President of the United States. Neither one of them will be President of the United States. Why do I have to spend time with them?

He knew he had to do it, but he didn't like doing it. I don't think anybody would have liked to do it. You especially don't like to do it when you're not getting a great reception. He's pretty comfortable in himself, so he doesn't need it. But he doesn't need to get beat up. You know, how much more? Give me another ten lashes, sir. Thank you. Forget it. He's not a masochist.

He had health problems at this time that some people focused on as being at the core of some of this--his medication for the Grave's disease. Since you were somebody up close, did you observe--

He was taking medicine for his thyroid, for the Graves. Whether they had the right mix, I don't know. I always found him energized. Did he act like a 40-year-old kid? No. I did not see any real signs of that. He worked every day, Saturdays and Sundays. He did not depart from his structure. He did everything he was asked to do, maybe some reluctantly. I don't think the health problems were any major-- If he was tired and frustrated, that showed. That's human nature. I don't know anybody who isn't going to have that problem. I saw Clinton, when he was running towards the end there, he looked terrible. When he was frustrated and tired, he tended to say things you shouldn't say. I think there may have been a little of that, but he was more controlled than I was, frankly.

And don't forget, we're getting nothing from the Senate. They're doing everything they can to take us down, over in the Senate, in a very partisan way. We're frustrated about the legislators and the legislative session. Gingrich is out there. He's the minority leader. He's out sniping at you.

Why would he do that?

Because he wanted to say something. He had it on his mind. He immediately would write it down, "Dear Mr. President." He'd write all of this stuff down. "Very respectfully yours, Newt Gingrich." Then, he'd immediately deliver it to the guard shack to be delivered to the President. You'd look at it. You'd call him back and say, "Newt, do you really want to say this?" "Well, I didn't really mean that." It's one of those letters. Newt had a tendency to write letters, like we all do. You should put most of them away for a day and say, "Do I really want to send this letter today? Well, no, today I don't. Yesterday I did. Today I don't." Newt couldn't wait the one day. He had to deliver it to the guard at the White House.

Then, on top of that, we had the L.A. riots. Now, we're in the middle of the L.A. riots, and did we do enough or did we not do enough? And, of course, that's a measurement of do you care? In the Watts riot, nobody accused the President of doing that. He tries to get a meeting with everybody, to show that you're involved.

Or, we're sitting there. Then, we're out there. Now we know things are not getting good, and I'm advising the President. We're all saying, "We have to call out the National Guard." So I get on the phone with the President, Pete Wilson, and Mayor [Tom] Bradley. "Well," the President says, "it looks like things are getting pretty tough out there. I think we ought to make some moves. What do you think we should do, Pete? I think it's time to have National Guard move in. What do you think, Pete?" "Well, I think we ought to see what Mayor Bradley says. I think we got things under control." "Mayor Bradley, what do you think?" "Well, I think it's up to Governor Wilson. I think we got things under control."

The President hands me the phone and says, "You go in the other room and solve this. I've had enough of this." So I go in there and I say, "Now, Tom, you know we've got to have the Guard, right?" "Yeah." "Pete, you know, we've got to have the Guard, right?" "Yes." "Okay, we're ordering the Guard." I wish I had a tape of that meeting.

In addition to that, it was one of these years when the moon and stars all come together at the same time, the stuff crashing in on you that would not happen in a normal year. They didn't have anything like any of this stuff going on. But all of it's what he's measured against because he's running for re-election.

It used to be that you'd have three years of running government and one year of running a campaign. You're organized differently for the three years than you are for the one. Since Bush 41, those things have changed. The sea change occurred with Clinton, and it's now occurring with Bush. It's now re-election from the get-go. From the absolute get-go in your first term, everything you do and plan around, and every decision you make, you look at the political implications of it.

Is that good or bad?

It's reality. If you want to get elected, it's good, get re-elected, it's good--can't be bad. It's probably not healthy in the long run. It clearly wasn't healthy. I think decisions were made in the Clinton administration that probably wouldn't have been made had the political factor not been there. You can't make every decision in government by putting your finger up in the wind and pulling out the poll and saying, "What do the poll numbers say I should do?" The American people aren't that well informed.

I think it's almost a reality, because both parties are so close--this last election proves it. It's pretty hard to be a landslide winner. Clinton was, to some degree, but the economy was doing great. He'd done a lot of those things, and Bob Dole just wasn't the candidate to beat him. Of course, they'd been able to push his major personal scandals down far enough to get re-elected and then have to deal with them.

Was it your proposition about the sea change that the Clinton administration--also the current administration--is thinking re-election, in terms of policy?

I don't know, because I'm not involved.

I'm asking you as an observer, just as an observer.

It may be that most government policy ought to go through, for lack of a better--a political scrub, "Does this make sense to the electorate?" before it's decided. If you don't, number one, you won't get it through, because the Congress will pick up on it anyway. And, number two, it will undercut your credibility. I think every major domestic policy decision ought to go through a scrub: "Does this make sense? Is there something I'm missing?"

Rostenkowski, a number of years ago, came out with a policy to change Social Security. The next weekend, he had senior citizens climbing on the hood of his car. They pulled the policy back within about twelve hours. That might have been the right governmental thing to do, but the electorate is not ready to accept it. So before you go with this policy, if it's the right thing to do, you better have begun to educate them on why it's necessary, so that when you do pull the trigger, it's got some staying power.

For example, when the market was hot, we were going to privatize Social Security so we could get better leverage. People ran on that in the election of '98. Then everything broke loose, and now that's a major thing against you. That might be, overall, a good policy, to leverage your Social Security account. But right now, with three years of a down market, it probably doesn't make a whole lot of sense. It's got no staying power, and anybody who said it two years ago is now being criticized for saying it. And Republicans and Democrats both were jumping on that bandwagon, to some degree.

Charter schools. I happen to believe competition in schools is very healthy. But we haven't prepared people for charter schools. So when we try to push for charter schools, even though the beneficiaries of charter schools are going to be the minorities in the less-affluent neighborhoods, they don't fully understand that. We haven't educated them enough, so the teachers' union jumps all over it, and it doesn't go anywhere. Schools are like a regulated airline. You give me a good, unregulated airline-- I'll put Jet Blue or Southwest Airlines up against Lufthansa any day, or Air France. The same thing applies in education, but we haven't educated people on the need to do that, or haven't gotten critical enough.

But you restrict this to domestic policy.

Well, I don't think you should go wage a war if the American people aren't behind you, unless you absolutely think it's necessary. But I generally think that, when you get into that, unless you're talking about doing something very dramatic-- There's a reason that the Defense Department, the Justice Department, Treasury, and the State Department are basically--the four Cabinet officers don't do politics. They're the four Cabinet officers who do not do fundraisers, do not have political people come in to see them, and are "off limits" in Republican and Democratic administrations. That's because these are probably issues that we don't need a lot of political influence on. They're harder for people to understand. I'm not saying the electorate is stupid, but they're harder to understand. Look at what we've had to do to educate the people, and still the unknowns on Iraq. It's harder to do.

And Israel--that's probably not a good example. On the other hand, it isolates them. Should we have gone into Somalia? The way we went in? Absolutely not. Did the American people support that? Absolutely not. Are you going to be able to convince the American people that we should go to Somalia or Bosnia to do peacekeeping? Absolutely not. If you took a vote on any one of those, they'd say what? Seventy to 80 percent would probably say no, before Blackhawk Down. It's very hard to build your knowledge base. There are some things you entrust with people, correctly or incorrectly, and you have to let them run with. It just is not susceptible to education, not to make a knowledgeable decision.

It was sometimes said of George H. W. Bush that here was a President who was probably the most experienced President in terms of foreign affairs of almost any other one in the century. It was also he had strengths and skills, apparently, and a network of personal acquaintances with heads of state that were very appropriate to the circumstance he had to deal with, building a coalition and so forth. And domestic policy was not his forte.

Major foreign policy issues took up much of his time.

I wanted to ask you about that, because I think that's important to understand about Bush, and I'd like to get everybody's testimony on that. It's also in domestic policy, it appears, that there is much more politics of a sort George Bush didn't like too much to be involved in: stumping, bargaining, wheeling-dealing.

My guess is that everybody has their areas of interest. Every President has their areas of interest. I don't think he wanted to neglect it. But he probably thought, and does think, that other people can deal with these domestic issues for him and on his behalf, while it's very hard for anybody but him to deal with issues at the national level. You can send only so many emissaries to meet with the heads of state or heads of government in France and England and Germany and Russia. You've got to be personally involved there.

There are plenty of people you can get to design a national highway system for you. There are plenty of people you can get to develop a policy for healthcare or reforms in healthcare. You can get plenty of people to look at what we should do about Medicare in the funding and the benefit levels of Medicare. You can sign off on their process, and Congress will scrutinize it very carefully, and by the time it gets done, you probably get a pretty decent policy--maybe a policy of compromise, but there are plenty of outside forces looking at it.

In foreign policy, there isn't. You are it. You and your team are basically it. Yes, we go get a war resolution before Congress when we need it, and we have foreign affairs committees, but they're not deeply involved in it like they are in domestic policy. Today, Congress is deeply involved on the domestic side. In fact, one of the big problems that you'll hear, I'm sure, is the biggest frustration, the biggest surprise--it wasn't to me, but it was to others who've been around--is how much Congress has eroded the Executive Branch's power in domestic affairs by earmarking, by special legislation, by authorization. They stay as committee chairs, and Presidents come and go. It's very frustrating. If you ask a Cabinet officer today the biggest frustration, it will be the amount of time he has to spend up on the Hill.

You can see it, by the way, in [Donald] Rumsfeld's reaction to the Hill. I don't know if you heard the Iraq debate. I didn't hear it, but my wife was telling me it was on public radio. He came up to the Senators, including Republican Senators. He said he was going to come up and tell them why we really should go in, and give them all kinds of information, and they said on the floor of the Senate, "He didn't tell us anything. He just said, 'Yeah, we're going ahead. We need your support. Good-bye.'" John Warner even said, "He didn't do or say as much as we'd like to have had. But we have to rely on him." I think the frustration level in dealing with Congress in the Executive Branch is at an all time high, even not counting the judicial nominations and some of the other staff. Pretty soon Congress will be approving FBI agents' nominations.

You look at Bush's team in national security, or foreign policy, Baker, [Brent] Scowcroft, and Bush. Cheney. And you look on the domestic side to see how is that done and who were his-- He didn't have anything like that on that side, did he? Unless I'm deeply mistaken about something.

You're entitled to your position, professor, but I'm not going there.

I wasn't really talking about the quality of the people.

I guess you have to go back. You're filling 13 statutory positions and half a dozen non-statutory positions, roughly. We have to make sure--and I'm not against this--we have to have three Hispanics, we have to have two African-Americans, we have to have four women, and we have to have not too many white males. Then we have to get people who, number one, I know. Number two, who want to do it. Number three, who have enough experience in government so they won't fall flat on their face, even though they've been successful. Do you think Jack Welch would be necessarily great in government? Maybe not. I happen to know him and think he's very effective, but I'm not so sure he would be effective in government. Then you have to get them all through the funnel. Then the person has to be accepted by all these constituency groups.

Even if you have the best candidate, if the ALPA [Air Line Pilots Association] doesn't want you to be Secretary of Transportation, you may not make it. If the airlines don't want you, you may not make it. If the U.S. Chamber of Commerce doesn't want you, you may not make it. If the ACLU [American Civil Liberties Union] doesn't want you, you may not make it. All of a sudden, by the time you get through here, believe it or not, we have a narrow slate of people who can pass all of that, can meet all of the needs. It's a high standard to get through that funnel, professor.

Well, I wasn't really talking about standards. I was talking about the number of people that you need to do anything. I think you were just saying that. On the national security side, you can have a tight-knit team of four people, because that's the nature of the beast. For the other, it's very difficult. You can get in a Bob Rubin or--

Yes, you can get a Bob Rubin once in a while. You can get Clayton Yeutter. They'll come through. First of all, I'll give you a statistic. CEO searches in America, by search firms--what percent do you think are successful?

You mean finding a person to place in a position? What do you mean?

If there are a hundred CEO searches in the United States this year, what percent do you think will be successful after three years? They find somebody. Three years later, you measure how that candidate did against what you expected. What do you think the success rate is?

No idea.

Forty percent. Six out of ten. The higher you go, the harder it is to hit a hundred percent. You'll get a great Jack Welch. You'll get a great so-and-so. It's below 50% of the people you hire for top jobs, after an extensive search, outside, full examination of their qualifications, full set of interviews, full set of background checks, no political needs to be taken into consideration, none of these other parameters. You're going to get four out of ten who will be successful.

That's all I'm saying. It's easier if you're filling those 19 positions. By the way, it so happens that both Bushes have had a great team around them. But all administrations have not had that success. I think it's an anomaly, frankly. I think the fact that we've got outstanding performers in both Bushes' administrations, at the top--of course, some of them are recycled. At least one's recycled, Cheney. You could say Powell's recycled because he was in the National Security office under Reagan and then, over at Defense. But there have been others. Les Aspin had his struggles. I'm just saying that it's hard to get, and know you're going to get, and get them through, a full slate of really outstanding people.

All of Bush's first choices for those positions were old acquaintances of Bush, people who knew Bush, and Bush knew them. The first, [John] Tower, failed the nomination, but he was the first choice for Secretary of Defense. Jim Baker, with him a long time. Brent Scowcroft he knew very well. And he was in the foreign policy field a lot of his career anyway--the CIA and so forth.

He didn't make it out of the gate because Sam Nunn didn't want him. Let's not make any mistake. John Tower could have been a great Secretary of Defense. We'll never know. This is going to this balance of power. Sam Nunn did not want to see a contemporary of his on the Armed Services Committee become Secretary of Defense. So he took him out. And John Tower gave him material to take him out.

I'm just saying these were Bush's initial choices.

Right. But I'm talking about choices who have been in the office and how they've performed the job. That's what I'm saying. Any time you select that number of people in that short a period of time, with all the criteria that you have, you are going to be lucky to come up to a success ratio of 40%, which is the national corporate average for CEOs without all of these factors. I'm just saying it's hard to hit a hundred percent.

I hired 16 presidential appointees. I think I did a pretty good job. I had all of those factors to worry about. I hit some home runs. I hit some triples and some doubles. And I had a couple of strikeouts. I dealt with the strikeouts--and you improved. Over time, you could improve your organization. So if you have enough time, you'll keep your 40%, and you'll backfill, over time, the remaining 60. So, if you have enough time, by the end of your sixth year, you'll have put a pretty good team together. But you're going to make some mistakes the first year.

Getting back to Bush. Bush's main experience was not in domestic affairs. He'd served a time in Congress, but that's a very limited experience. His main interest and, after all, the main situations he had to deal with as President, were the collapse of the Soviet Union in Europe and all of that. So it looks to me as though you've got Sununu and Darman the nearest things on the domestic side in his personal staff.

That's right.

--and you have Baker, Scowcroft, and the rest on the other side. That's just an observation, but, getting back to the understandings that Bush gave you about your job in the White House--he didn't want major changes in the staff. Why couldn't he? Presidents don't fire people, but they do reassign them. That's the typical way. They move them someplace else.

That's a little hard. The White House is like a family. What I'm saying is, it becomes very close. You're around each other all the time. It's not like any other organization. It's hard. You become very protective of them. It's a unique environment that's hard to describe. You don't understand it when you go in there, having been outside. I'd been over there a hundred times, and I didn't understand it fully. You're right next to the President, and that immediately affects everybody's attitude. It's rarified air--at least to our President it was--and to everybody else around it. There are some unique things that you see go on there that you'll never see anywhere else, that you can never talk about for the rest of your life. You are in the trenches every day, sometimes good days and sometimes bad days. The good days are euphoric. The bad days are bad.

And many of them toil without recognition. A Cabinet officer gets all kind of recognition. A lot of these people don't. I think it builds a sense of camaraderie that's hard to duplicate in government. Also, people take shots at them. If this doesn't go right, it's never the President's fault. It's always your fault. So I think they tend to be protective of each other. That's all he was telling me. A wholesale replacing of the White House staff in December would not have been the right thing to do.

The study probably wasn't the right thing to do, which you've heard about, I'm sure. That was probably not the right thing to do. The right thing to do was probably for me to say, "Generally, the rule is you ought to have your own team in there. But, right now, in the circumstance you've been given, that's probably not possible. So let's take a breather. Let's think about, quietly, the three or four positions that will really make the difference, where we've really got a shortcoming, and take care of those and work with the rest. If we're fortunate enough to be re-elected, we can deal with the others later on." I couldn't fire any staff. I think he was just saying, "Just don't throw them all out."

He allowed me to do that. I made a choice in the deputy. I would have had a communications guy, if he had been willing to tell his partner what he was making. I had a government affairs guy in Nick Calio. I got the external affairs, the public affairs with the business community. I got Clayton Yeutter as the National Policy Advisor, and I got my Deputy Chief of Staff. I got five. I can't complain. Those five should have made the difference. Unfortunately, one couldn't come because of his contract. One's husband wanted to go work for Perot, so she had to leave. The other one was a good man, but probably never got a fair shot at the job because his predecessor was beloved. All of those things would have worked themselves out over time. But time you don't have. You have only a few months.

I just took over a company a couple of years ago. I've had a couple of years to work my way through problems. Over two years, I've built the staff up. I've got them all. I've just taken care of two this month. I'm taking care of one problem. But that's over two years. If you do it quickly, you're liable to make mistakes, and it's not easy to do. I would not blame President Bush on anything that did not-- Even though that adage that I just said is the right one, generally, and that's the one I employed at U.S. Freightways, and one I employed at the DOT, it may not have worked in the environment in that short time frame that you had.

I did not anticipate being there much beyond the election. In my own mind I'm saying, let's do what we have to do to try to get the ship--it's listing. Can we get it back up? Instead, it listed the whole summer and fall.

Even though '92 was a campaign year and everything overshadowed that, did your time in the Cabinet give you some insights about the way you dealt with Cabinet Secretaries as Chief of Staff?

Not really. I don't think there's any training for the job. Going to the point--Chief of Staff--first of all, I'm not afraid to take responsibility, but I also believe in the chain of command. I don't think I'm the President. I'm the Chief of Staff. He's the Chief of the Presidency. Therefore, while he delegated to me, I'll make the decisions, I don't think you should be making decisions for the President of significance without running them by him and getting his permission and telling him what's going on. I felt comfortable doing that in Transportation, except when they got to a higher level, then I ran them through, but I certainly--lower-level personnel changes, no problem. But before I let somebody take out a Deputy Secretary or a Secretary--which are key positions--or whether they take a policy that might be a little controversial or whether we're going to spend money on this area versus that area, I think you owe it to him to run it by him. When we needed to do that, we would do that.

I'm sure other Chiefs of Staff have taken more ownership of some of those issues and probably did not feel the President needed to know as much as I did. Now, Bill Clinton wanted to know everything, and he worked 7 by 24, and he has a wonderful mind. So he could do that. He would sit there. He likes nothing better than to have a two-hour policy discussion on Social Security reform. He's unique in that regard. I told you I was reading a book on Lyndon Johnson. I think he knew what was going on, but I don't think he spent time like that. It's clear that some of our Presidents haven't. I think Clinton was unique in that situation. They delegate a lot of it.

Did you get any advice--asked for or not-- from other Chiefs of Staff?

Oh, yes. It's a small group, and--whether they're Republican or Democrat--they're all pretty comfortable with each other. Most of them said it's a lousy job. John was the only guy I've ever met who really liked the job. Most of them said, "It's a job that has to be done, but it's kind of a thankless job." Howard Baker said, "Your job is to follow the elephant and pick up after him. It's a lousy job." I didn't actually find it lousy. There were some parts of it I really liked.

What were those?

I liked making government a little more efficient, the non-political part of it. I think I did a pretty good job for him--which we'll never know--getting the things done, keeping the train running on time, getting the right appointments made, getting the process, protecting him from bad decisions, making sure he got credit for the good decisions, making sure that people got along, making sure that problems that were exploding didn't explode any further and handling them.

How did you protect him from bad decisions?

Just make sure he heard both sides. Make sure, if somebody tried to make a decision without running it by the White House, to let them know that they weren't allowed to do that. Call a Cabinet officer and say, "You know, you didn't run this by the President. We're not doing this until you run it by the President. I want a briefing paper, and I want to hear the other side." Or calling Jack Kemp up at three o'clock in the afternoon and saying, "Jack, you cannot say 'gimmick' on television. Now, issue a statement, CNN, ?I was misspoken,' and have them run it. By tonight." So the story doesn't have more than a one-day leg.

Unless you like making people's lives miserable, you don't like doing that kind of stuff. But it has to be done. And that part of it I thought I was pretty good at--did it in a way that didn't overly offend anybody, but made it clear that you can't undercut the President's authority on this.

The day began, did you start with your own staff--

Everybody does it their own way.

I'd like to find out how you did it.

Our day, my day--usually I left the house about 6:00. I was about seven minutes from the White House. I would get in about 6:30. We'd have a pre-staff meeting before 7:00, then a staff meeting at 7:00. Then I'd go in with the President at 8:00, usually to get the national security briefing, and then to get Scowcroft's briefing. Then I'd brief them on my stuff. You'd have meetings all day, either up on the Hill or wherever. You would never go out for lunch unless you needed a breath of fresh air. You'd have meetings until late in the evening on various policy issues. You'd go home about nine o'clock at night, and answer your phone calls and your faxes, and go to bed, and wake up in the morning.

The first thing you said with your own staff.

I used to have a pre-staff meeting with two or three people. Henson [Moore] was the Deputy. Darman would joint those meetings. There would be one or two other people. That would be before the main meeting, which would be assistants to the President, deputy assistants to the President. It would be about twenty people in the senior staff meeting. That's basically the policy, the way it's been going for administrations, Republican and Democrat.

Then you'd go in for a meeting with the President, after those were over. And those would be, "This is what the schedule is for the day. This is what we're doing today. These are the bullet points for the day. These are things we want to be talking about. These are the problems that have come up. Is there anything that you're doing that we ought to know about?"

Would that be a time when he would have--

He wouldn't be there. It would just be me and the senior staff.

Did you meet with the President during the day?

After that, yes.

Okay. I was jumping ahead.

Yes. After that, I would meet with the President. The first order of his business for the day was the CIA briefing and the National Security Advisor briefing. Then he'd have a meeting with me, and we'd discuss any domestic issues that were going on. Then he'd go into his regular schedule.

And in your meeting with him, you would cover what kinds of things?

What kind of things are going on. "You've got a meeting here today on this. This is what this is about. This is what this is about. This is what we're going to do today, here. These are problems that are coming up." Then, during the day, if he had free time and I did, I would go back into the back office, and I would run things by him there. No one could walk in, other than his family, without going through his secretary and, generally, me. Personal friends could, and of course he could bring anybody he wanted in. But I set up the appointment schedule.

Did all of the national security stuff also flow through you, or was that a separate channel?

No. It went through Scowcroft. I could sit in on the meetings, but the Chief of Staff generally is not in that loop, not in the decision loop, unless you were asked your opinion. I had my hands full. It was in good hands with Brent. It's being handled. Don't spend any extra time on it. I don't need the face time on national security matters when we have our own security matters in Watts. I would listen on occasion, and it would be interesting, and I'm sure, if you had a normal thing, just out of a curiosity and interest, you would go in there and listen.

Right now, obviously, it's different. When you're getting ready for war, it would have to be different. But when I was there, it wasn't. I'm sure Sununu participated in almost all of the meetings, as does Andy. But that's because that's the major agenda of the day.

Did you travel with the President often as Chief of Staff?

He liked to have someone travel with him, and I think he would have preferred I travel with him all the time. But I felt, with everything that was going on, it was hard to be effective on the road, in an airplane, operating on cell phones. And he was gone a lot more than he normally would have been. I think if it had been in the first three years, I probably would have traveled with him more. I did all of the foreign trips with him, with the exception of Japan. I did not do some of the domestic trips. Usually Henson went with him. That was only because it was an efficient use of time. But he would ask, "Aren't you coming?" because we genuinely like each other and enjoy being with each other.

I would like to have gone. I don't have any adversity to flying on Air Force One or Marine One, but there was just too much going on. It was too hectic to be an efficient use of your time. Most White Houses now have gone to two Deputy Chiefs of Staff, which is probably the right way to do it. We were also running a lean operation. The President did not want to look like he was beefing up the White House. He had an idea we should have a lean staff, so we didn't have a lot of excess in our staff.

I want to ask you a very general question about Dan Quayle's role during the Presidency, both from your perspective as Secretary of Transportation and as Chief of Staff. What did you see of Quayle? What were your perceptions of him?

I knew him quite well. I got to know him as a Cabinet Secretary. He and I have a love for golf. So on occasion we'd get out and play golf when we could in the normal days. I got to know him playing golf, and I liked him a lot and like him a lot. I have a lot of respect for him. So I was pretty close to him when I came in. John was, too. I think he and John were pretty close, too. I think he's probably the most misunderstood person in the Bush 41 administration.

I found him to be, number one, very organized, very thoughtful, surrounded himself with very good people, listened to what they had to say, had a lot of good, common sense things to say and was a valued advisor to the President. I think the President treated him as such. I think the press, from the get-go, from the day he was the surprise announcement without any preparation--which goes to my point, if the public isn't ready to accept something and you surprise them with it, it sometimes doesn't go down so well. If he was going to go with Quayle, he should have prepped the American people for Quayle, his experience on the Foreign Affairs Committee, et cetera, and he didn't.

So he started out with one foot in the hole. And he obviously made a couple of speaking mistakes, and that was magnified by the press because they didn't want him to succeed anyway. But I found that the image that some people had--that he's slow and stupid--is just not correct. I think he's a delight to work with. It was very unfair and frustrating. As a friend of his, it was frustrating for me to see that. But that was what the press got in their mind, and we weren't going to change it.

Did the President rely on him for political advice and policy advice?

I think so. The President had lunch with him every week. He was in there all the time with the President. I don't think there's any question the President relied on him. When the idea came that maybe we could fix the problem by replacing the Vice President, that was never a starter. It just never got anywhere. The campaign people thought it was going to get off the blocks, but it never got off the blocks.

What were the areas of policy that Quayle was most active in?

Well, he obviously was interested in national defense issues. He was also interested in the space program. He got very involved in that. He did a very good job. We had a management issue at the space agency, and he took care of that, managed that, found a great candidate who stayed through the last year of the Bush administration, stayed through eight years of Clinton--Dan Goldin--and one year into Bush 2, 43. He probably understood more than anybody in the White House what other people were saying, what were concerns of the constituents. I wasn't there--what his position was on the tax increase. Have you had him down here yet?

Yes, we've interviewed him. We had to go to Arizona. Spent a whole day with him.

Depending on the time of year you went, it's not the end of the world.

It was hot.

It was an interesting interview.

It was a very interesting interview, yes.

Very enlightening.

Was it? Well, what were your reactions?

I would say it was very much along the lines that you just suggested. The only additional thing I think I could say in terms of impressions was that I thought he had a remarkably well-developed political sensibility that came to me unexpectedly.

That's what I'm saying. I think he had the best political feel for what was going on. I don't know, but my guess is he probably picked up on that tax increase thing, that this may not be the thing we want to do, and probably was just outvoted. The combination of Darman and Sununu was pretty formidable. It was a wall even the Vice President would have a hard time breaking through.

Would he have been consulted on something of that nature?

He might. It's hard to say. I would think he would have been, but if he had to, he probably would have been consulted by the President. I think John and Dick might not have consulted him on that. But I think the President might have, if he'd had a chance. I wasn't there, so I don't know. You guys would know better than I do because you're doing the study, but I think that probably when it came time to show up at Andrews for the budget conference with the Congress, where Mitchell put a condition on it--taxes have to be on the table--that may have been the decision. Who knows whether that was the decision when they came back with the program and said, "You have to do this." I don't know when they made that decision, whether they thought they were going to have to break the pledge when they went out there.

I think it's probably unfortunate that Quayle wasn't out there, because my guess is it would have been a different scenario. It's much different now, because basically President Bush has two Chiefs of Staff. Cheney clearly plays a significant role. There weren't a lot of people, besides Darman, around Sununu who were at that level. You have Cheney there now. You had Karen Hughes, and she's still around. You have Karl Rove--and Andy. You have at least four people there who've been around a long time, and they all have input. No one person-- Cheney probably has the most input, but there are others pushing back and forth.

How did you spend your time as Chief of Staff, in terms of allocating? Could you talk a little bit about being with the President? I was so curious about Cabinet interactions. You said occasionally you'd have to call somebody and say, "You've got to run this past the President first." I'm curious because in other administrations there have been real tensions between the Cabinet and the White House staff, resentments and so forth.

I think there was probably some tension between some members of the Cabinet and John. There wasn't any between him and me. But I don't know. I don't think I had any. This was by now a pretty experienced Cabinet, and they knew there were ground rules. So I wouldn't have to call them too often. They would usually come over to see me because they had something on their mind. That would be a small part of the day. They would usually come over rather than do it on the phone. It wouldn't usually take more than a few minutes, and then it would be over.

They'd usually be personnel issues, and it would usually be where they thought they might get some pushback on a personnel selection from the Office of Presidential Personnel, and they either wanted to cut it off, or they wanted-- I remember Cheney coming over on a couple of those. But having been a Cabinet officer was a plus for me in that regard. They knew I knew where they stood, and they also knew that I generally, if I could, would go along with them. So they did not expect a lot of pushback from me, nor did they get it. You can probably count on two hands the number of times I, in the time I was there--with some fingers left--had to call someone in and reprimand them.

They didn't generally create many problems for the President. They weren't problem departments that-- The nearest to that would be Kemp talking out of line or something, for a reprimand or a put-down. I think the Chief of Staff is always involved with a Cabinet Secretary in cases where that person is really creating big difficulty.

Yes, I think that's unusual. I think President Bush had a Cabinet that he got along with much better than many other administrations in the last four or five decades.

Well, a lot of it is probably the kind of people he was attracted to. If you look at them, there were not a lot of confrontational people who take it to the edge all the time. Jack was probably the only one, really. You go right down. Bob Mosbacher wasn't that. I wasn't that way. Jim Watkins wasn't that way. Cheney wasn't that way. Baker wasn't that way. Elizabeth Dole wasn't that way. I could go on and on. Manny Lujan wasn't that way. Bill Webster wasn't that way. There were very few who weren't the kind of people, "I'm here to do my job. I'm not a confrontational human being. I don't try to put people on the edge." Dick Thornburgh wasn't that way.

I think you've probably got more in this Cabinet than you did in that, my guess. I'm sure you do. I'm sure they're people with some strong opinions, who are probably somewhat vocal about them. My guess is they don't do it in front of the President because, from what I hear, he doesn't tolerate it. He wants, "Whose nickel is this? What do you want to say? Say it, and get on your way. Don't waste my time unless you're ready. And if you're not ready, I'm sending you out. When you're ready, come back. No nonsense, no fooling around. This is serious business, this is a serious office, treat it seriously. Get on with your business. I'll joke with you on the way out."

That's the way he is. He runs it like a tight ship. So does his father. Meetings at 9 o'clock began at 9 o'clock. Meetings that end at 11:00, end at 11:00. That doesn't mean you don't find time to work out, or get a haircut, or something like that. They're both very organized people. Of course, President 41 is extraordinarily thoughtful to people, too, with a great sense of humor, who could make fun of himself. President 41 could make great fun of himself. That's a very endearing characteristic, as you know.

But the process, Jim, going to your point, is that it basically is just like anything else. After you have the first set of meetings in the morning, then it's things you're working on for the day. People want to come to see you. Demands to come in to see the Chief of Staff are extensive, so you'll probably have two or three meetings a day. The bankers want to come in and talk to you about branch banking. Or the airlines want to come in and talk to you about more open skies. Everybody wants to try to get in to see the Chief of Staff and make their point.

Then you have the press. You have to decide how much you're going to speak with the press and do it. I probably had too tight a policy. A good Chief of Staff generally--Baker is as good as they come, and Margaret Tutwiler's job working for Jim Baker was to work the press. That was her job. She may have had other jobs, but she did it, and she did it very well. She was close to Ann Devroy until she died. She knew how to work it with the best, and that served him well.

Explain to me what you mean by working the press.

I mean work on it. It's a two-way street. That was John's problem with the press, and probably mine a little bit, too. The animal needs to be fed. Darman was pretty good at this, too, feeding them some stories that are hopefully not harmful to the President, but would give them something to write about. Remember the story I told you about earlier this morning about them--give me something new, let me distinguish myself from my colleagues.

You pick about half a dozen to a dozen that you do a favor for by giving them a story, giving them an interview or something like that. If there's a question coming up, something coming up early, they'll in turn call you and let you know that it's coming up so you can deal with it. It's a two-way street. But I think an effective Chief of Staff probably, in most White House-- I shouldn't say that--I don't think Andy does a whole lot of it. He probably doesn't have to. And John didn't and I didn't, but I think Baker did. You can argue how much you should do and how much you shouldn't do. The criteria ought to be "Is this going to help the President?" and "What can I do to develop a relationship with the press that's going to help the President?"

You distinguish between working the press and leaking--the fair game of working the press is authorized stories that are going to reflect well on the President, whereas leaking is unauthorized and will not?

It might be leaking something that is totally innocuous. They don't care if it's critical of the President. They just want a story. If you leak to them that tomorrow Russ Riley is going to be the new Administrator of the Drug Enforcement Administration, and that person runs with that story the next day before it's out in the press, and it turns out to be true, that's just advance leaking something that's not harmful. The decision's already made.

On the other hand, if you leak the story that Hannah and Jim got into the most unbelievable fight yesterday in the White House, and one's saying one position, and one's saying the other, and there's two sides to this. "Jim tried to arbitrate, and he didn't do a very good job, either, and the whole place is in chaos, and we don't know what we're going to do on this policy," that's a leak that hurts the President, and that's different than your other one. The problem is that sometimes you cross the line, and it's difficult to do it.

Some of them can be innocuous. I remember one time a story leaked out that was an innocuous story, but I knew it had come from someone who had been leaking other stories that weren't so innocuous. I knew this one. I had caught him, because I knew where it came from, and I knew it had to come from there. So when we were at lunch that day, I just mentioned in passing with a bunch of people at the table, that we'd had a leak on the story yesterday on the news, and I was going to have to ask the FBI to investigate where the leak came from. That was solely to let him know-- And the leaks stopped, because he knew that I was serious, and whether he knew I was doing it deliberately or not or just expressing an opinion--just saying something as a matter of fact. But I had done it deliberately, because I knew that it had gone on too far, too long, and I wasn't going to tolerate it any more. I never ordered the investigation, and I never frankly intended to. But he didn't know that.

I was going to ask you about favored avenues for releasing these things. My assumption is that there must have been some media outlets that were preferred over others.

The 800-pound gorilla when I was there--you worried about the Washington Post. You, secondly in print, worried about the New York Times, and to some degree then, you'd worry about the other national newspapers, particularly USA Today or the Wall Street Journal. But the big ones--mainly because if the story was inaccurate, it would get carried anyway by the others. The Washington Post was the 800-pound gorilla.

Had the Washington Times developed enough of a--

Yes. The Washington Times, you wanted to, because they would be more sympathetic. They certainly were a factor, but they weren't nearly as widely read as the Washington Post. The networks were the big deal: What's on the network? Is it negative? Is it positive? What's your 30-second sound bite on the network, or your minute on the network? Today, 12 years later, 10 years later, it's become a much different ball game. What we have now is all these news outlets and, obviously, network television isn't what it was before. Network news isn't what it was before. A lot of people are getting their news from CNN and Fox News and CNBC, MSNBC, et cetera, and we've got a new network that's much stronger, the Fox network. So it's much broader.

It's a very good question because you still have to get exposed. For instance, who do you do interviews with during the campaign? Who are you going to let interview you, and who are you not going to let interview you? We did a show with the CBS [Columbia Broadcasting System] Morning Show one day on the White House lawn. We had all kind of caveats that they weren't going to ask this question--they went ahead and asked it. They just misled us. I heard the producer and the anchor set it up. I was sitting next to the producer. She didn't know I was sitting behind her when they did it. It was just a setup. When we got back in, if you set that interview up and authorized it, and it went wrong, all of a sudden, you're in the hot box. And you should be.

We had a couple of those, because the press was so looking to "gotcha." The "gotcha" business in the press, which Bush hated, but they loved. There was a lot of "gotcha" business. There are outlets you have to deal with because of their presence, and there are outlets you want to deal with because you think they're more fair. So you tend to do interviews with them, rather than ones that are just going to use you, to skewer you.

Was talk radio a factor?

It was becoming big then, but not nearly as many. Oh, here's another one. I couldn't get Roger Ailes to come down. I wanted Roger Ailes to come down, and he had had it. He had had some bad publicity, and he wanted to stay out of it. He was a kind of silent advisor to the President. He would have been a great communications person in the White House, but he didn't want to come down and do it. He was very big on Rush Limbaugh. He knew him. But it was just getting going. For instance, you run to New York now, you have to see [Don] Imus in the morning and these people. They weren't that big. I think the President had a lot of respect for Roger, and rightly so. I think he got him on to meet Rush Limbaugh and do a show with Rush Limbaugh, but it was just beginning.

I want to ask a general question about the tone of the re-election effort and the focus on the re-election effort. You might answer this by saying that was somebody else's ballgame, but one of the decisions that evidently was taken during the course of the campaign, or as you were preparing for the campaign, was that the focus would be off international affairs and on the domestic agenda, because that's what the poll numbers were saying. Do you have recollections about the decisions that you were making at the time, or about the process of making decisions at the time that would be revealing about what you were thinking as you were shifting focus? Whether there was attention given to the fact that the President had these extraordinary success stories abroad that--regardless of what the poll numbers were saying--needed to be at the core of a re-election effort, because that's where the majority of the energies had been put before?

Well, the President would like to have said, "I'm going to get a lot of credit for that," as he should, and "That's going to be worth a lot." After a while, the polls showed that that was yesterday's news, and the domestic issues were dominating the scenario. There were no foreign policies present. So, basically, it was hard to put that message out and say he won the war. He forced the Iraqis back into Iraq when nobody cared. They're back there now. You know, "What have you done? I'm unemployed. What have you done to get me a job? I can't get a loan. I'm going bankrupt. The economy stinks." Those were things that they wanted to know. The consensus from the pollsters and everybody else was, "What are you doing about the economy?"

The environment had so dramatically changed that there was no utility whatsoever in focusing on the success--

Very little. We tried to a little bit, but it didn't resonate very well. Yet, on the other hand, it became clear there wasn't a whole lot government could do. In the old days, government could do some things. Today, in the global economy that you have, it's much harder for the government to do anything if they wanted to. I mean, loosening the money supply. He's loosened the money supply, and we're still in a two-year downturn of the economy. It's just affected by global factors.

So what you're really talking about is doing things that look like you're doing something that you know may not have a great deal of effect on the economy. It's just going to take time to come out of it.

Sure. But there's a difference between the reality and the message--

Yes, and so you try to do messages: We're doing this. We're encouraging this. We're going to do that. But they were all geared--in the State of the Union, or presidential budget address--toward programs that would incentivize the program, would incentivize government, would either give some more grants to the jobless, give some more tax credits, would encourage industrial production and things like that. They were all nibbling around the edges, and that was the problem. You couldn't package anything of a magnitude that would appear to the American people like it was really something. You would announce things, and you would hope that little things put together--one plus one plus one plus one plus one would equal ten, instead of five, because your goal is ten. But on their own, there wasn't a whole lot you could do. You couldn't lower interest rates any more.

We haven't talked about the relationship with the Fed and the White House. The President was always under the assumption that the Fed and [Alan] Greenspan could have done more sooner. He thought they were going to do more sooner. When Greenspan was reappointed, he got the impression he was going to do more sooner.

Brady was in constant contact with Greenspan on that subject. But it didn't happen soon enough. Whether it would have made a difference, I don't know. There were a lot of people who felt that the Fed was slow on the switch, and didn't see it coming, and didn't take actions accordingly. That created problems. That obviously is a two-way dialogue. I'm sure Greenspan will say he moved as fast as he could.

That goes, I'm sure, under any administration, but it was critical here because the availability of credit was important--not only the credit being available, but also the prices at which credit was going to be available. But by the time I got there, it was too late. Nothing we could have done then would have made a difference by November.

On the hard numbers for the economy, Bush gave a percent of--

Oh no, I'm talking about lowering. If it hadn't been done by January, it's pretty hard to have an effect in October. And don't forget your reporting. The only time you're going to see the reporting is when the numbers are reported. So you're talking about the first two quarter numbers, how people feel, plus the first two quarters. At three quarters--you can get the October numbers out before the November election, but they're right close to the election.

We did come up with a number of initiatives and put them into messages, and had the President speak about them. But, for whatever reason, they didn't resonate, and they were sometimes undercut by people within the administrations who would be leaking. Not Jack. Jack was, at least, open about it. Others weren't open about it. "These really are just showboat items. They don't really mean anything." The leaking hurt there.

Why would somebody leak something like that?

Why would they do it? Because they're immature, and they don't have the President's best interests at heart. They're worried about their own reputation.

Within the base.

No, no. With the press, believe it or not. Not even with the base, because they're unquoted. They aren't getting any credit. He's not going on the record. There are people, believe it or not, who sit there and say, "The ship's going down. I want the press to know that I'm not part of the reason the ship's going down, and whatever they're doing, if it's not going over well, I object to it." Now that's silly. Because number one, nobody's going to know the difference because you're not quoted anyway. Number two, who cares what Ann Devroy of the Washington Post thinks? When you're gone, you won't even be in her Rolodex. But they don't know that. They still think that it's important what Ann Devroy and the Washington Post think. There are people who are so insecure and immature that they do that. We had a few of those in the White House. You can't conduct a leak hunt in the middle of a campaign. It just makes you look like you're weirder than they are. But, unfortunately, that goes to picking people who are mature and serious about the job.

I think the biggest benefit that Dick Cheney will have given Bush--going to your point, Jim--is that he helped to bring into the White House some very solid, mature people. That's why they don't have these leaks. I'm not so sure we had that kind of strength in the first Bush administration in the White House. They were young, and they were impressionable. This is an older, more mature group. Starting from Cheney, they're all people who have been around. They've run the gauntlet, and they've succeeded in running the gauntlet. I think it's showing. I don't think the President has to say a whole lot about it, either.

This is an interesting switch, because the old man--I mean the father--had a fair number of young and inexperienced people, right? And the young man has a lot of old experienced hands from his father's administration.

Yes, he did. That's true. But most of them have been picked by the President with Cheney's help. The President picked Karen Hughes. The President picked Karl Rove. The President picked Andy. Every one of the people was with the President in the campaign. They're totally loyal to the President. A lot of them came from Texas. Clay Johnson, the personnel guy, used to work for him in the state. All of these people he's got around him are, number one, fiercely loyal to him, like I was to his father. And number two, they know they're there because of the President, not because of Andy. John picked most of the White House staff. The President and Cheney picked most of this White House staff, and I think it shows. They know how the press works, and they control it. It's very frustrating to the press. I think Jim has seen some of these articles in Washington. They're really frustrated. The press has been quoted as being frustrated about the access. "This is the tightest White House we've ever seen. They don't give us anything." That's the name of the game. Go dump on the FBI.

Were you still Chief of Staff during the convention that year?

Yes.

What does a convention look like from the perch of Chief of Staff generally, and what's the Chief of Staff's role in it?

Well, you try to get somebody to organize it, and then you get it organized. The campaign had the responsibility for that. We were still trying to build into our conservative base, so we had people put on there, more conservative people. There was huge, raging debate over whether Pat Buchanan should speak at the convention. I--trying to be an honest broker--listened to both sides of it.

Teeter and the campaign thought it was absolutely necessary--if he didn't speak, it would kill us. Rich Bond, who was by then Republican National Chairman, said, "What in the world are you doing--after all he's done to you--having him speak?" I was with that camp, too, but I did not overly opine, because it's their convention. We debated it back and forth. I certainly did not want him to have a major role. We worked out a compromise that we hoped would do both. He would have the beginning at an early stage for about a minute of prime time, and then he would go off. We had no control over it, and he stayed over and ran into prime time about 15 minutes. He just gamed them. That was one of the first impressions.

He did that?

On purpose.

He made the agreement and then violated it.

Yes. Exactly. "This is how much time you're going to have," and he went over it. He just rolled them.

Well, he just stayed there, and--

Yes. What are you going to do? He's on the podium. You can't stand up and say, "Your time is over."

His speech didn't go over too well, and appropriately so. There were a couple of others who were on there, that there was some question about. But the point is, the convention was to try to position-- Of course, we left the convention euphoric. You always leave a convention euphoric. "Oh, this is it. This is the turning thing." And then, BOOM. Theirs comes on, and all of a sudden, you're down. Conventions fool you because you think they're great, and most people don't.

Was the idea of that convention to try to use it to build back the conservative base?

Yes. Almost from when Buchanan announced he was running, and we knew we had lost a portion of the conservative base--we were looking at the polls--we had to get that base back to win. We could not win without that base back. The erosion of the conservatives voting for Perot or not voting at all would be devastating--cannot with without it.

Perot was in the race at this point, and then dropped out just before the Democratic convention, is that correct?

Yes, and then he got in again.

Mid-July, he dropped out.

Right? And then he got in afterwards, in September.

Right. Back in September. But usually the thing is that you're running for your base in the primaries, and then you move to the center. But you were prevented from doing that.

We were forced. We were continually forced to do it because of Perot. Perot was out, but we still lost the base. It doesn't matter whether Perot is in. You're right--at that point, Perot was out. But we'd still lost our conservative base. Later on, when Perot got in, it became even more critical because we thought we'd be losing. There was a big debate: How many would we lose? How would the Perot vote break? Who was he taking votes away from? Was he taking more away from Clinton or from the Republicans? The conventional wisdom was--and still is mine--that he took more away from the Republicans. I don't know what the ratio would have been, but my guess is that had Perot not been in it, Clinton would have still won by a big margin. Because once they turn off on you, and they were for you, it's hard to get them back.

You mean the conservative base?

No. Anybody. Democrats, too. Conservatives are much more apt to leave you at the altar, in my opinion, than the liberal base.

You mean stay home?

Yeah. Stay home or not support you.

They're not going to vote for somebody else.

Whatever they're going to do. Okay, they're not going to vote for Ted Kennedy.

Right, or Bill Clinton.

But if they have an alternative, they'll go vote, because they feel strongly that they should have the right to vote. They'll just vote for a third party.

The Republican convention was second that year. What I recall was that the Democrats got an enormous boost because Perot dropped out at the time, effectively focusing a great deal of attention on the Democratic convention as the alternative to Bush at that point. So they got a bounce there that was part of a dynamic, irrespective of whether he's in the race in November.

And the Republicans didn't get a bounce that year.

Well, they got some bounce.

They got a bounce, which you always get, but it disappeared quickly. Then Perot got back in the race, and it went down again. What did he get--19.5 %?

19%.

19%. That's a big number.

It's a huge number.

Then you're on the road. You also have some things you have to do. During this period, we had a big debate over whether we'd go to the Rio summit. Big debate. Huge debate. Clayton mainly managed that. Clayton and I felt that we probably had to go, but there were a strong number of people who thought he should not go. That was mainly the conservative base who thought the enviros would get ahead of us and would take us out. Now, having said that, I think it was a non-event. I think it would have been a bigger disaster not to have gone. I don't think it would have mattered much either way. We had a huge debate about what he was going to say, and what position we were going to take.

That's when there was still this big fight going on over global warming, whether there really was global warming. Of course, John thought there was not. He felt very strongly. I don't know what he feels now. So those were all issues that you were fighting.

Did you have to get in between Sununu and Darman on one side on global warming and Bill Reilly around any of the environmental issues?

I stayed on the sidelines because I didn't know enough about the subject to opine. But it obviously was a big issue. Bill's relationship with John was probably the one of all of us that was most strained because of that. I think Darman supported John on global warming. On the other hand, I think Bush had--and has--a strong affection for Bill. So Bill was not without supporters. I never got into the issue because I didn't know anything about it.

Although, Bill was involved with Clayton in deciding when to go to Rio and what we were going to say. All I remember in Rio are two things: number one, I never saw so many soldiers on the street in my life--every 50 feet. They'd taken the beggars in Rio and put them off into encampments. They'd taken all the kids and orphans off the street, and they'd replaced them with soldiers every fifty feet. You would go from the airport to the hotel, wherever you were going, it was all soldiers every fifty feet with weapons.

Number two, when we walked in, everybody got nice applause. But when Fidel Castro came in with his uniform on, the whole place--with the exception of us--stood up and applauded, screamed and yelled, which lets you know that the Third World countries are closer to Cuba than they are to us. He got a standing ovation, and I'm thinking, Whoa. You knew what the people were talking about when they said, "Why do you go to Rio?" What are you going to get out of it? We got there and got back.

I'll just share this with you because it's interesting. No good deed goes unpunished, that's the moral of this. You remember that Bush had basically liberalized and freed Panama. The Panamanian government was ecstatic about their new status and wanted President Bush to stop on the way to Rio to accept the thanks of the nation. This goes to your point about where you put foreign policy in there. The general consensus was that it was right on the way, it would not be a big deal logistically, and President Bush felt strongly that it would remind people of what we'd done, not only in the Gulf, but how important it is--we've got this free country here now.

So we stop in Panama on the way to Rio. We arrive. There are cheering crowds at the airport. There are cheering crowds all the way into the palace, where we have dinner. Then we're going out to an outside arena, where we're going to make some remarks to a very closed crowd of 5,000 outside this palace area. The new police agency of Panama is just newly trained, because all of [Manuel] Noriega's thugs have been kicked out, and they're all new. But there are a few rabble-rousers--maybe 15 or 20--policemen or ex-policemen who've been kicked. They're making noise on the back end of the rally--not enough noise to bother anybody. The President is speaking to great cheers.

All of a sudden, these inexperienced new police officers fire their weapons with tear gas, because they're worried about the crowd. The tear gas is upwind, and it's drifting downwind. So all of a sudden, the tear gas starts floating into the arena where we are. Everybody is tearing. Then the guns start going off. The Secret Service goes into full threat assessment. They all rush to the cars, race out to the airport.

So we race out to the airport. On the way to the airport, the Panamanians are standing there, cheering us, waving American flags. We arrive at the airport, and there's a whole group demonstrating, "Thank you, President Bush." And we leave. Of course, on the evening news, the story comes out, "President chased out of Panama." No coverage whatsoever of the thousands and thousands of Panamanians who are expressing their love for the United States. In retrospect, we probably shouldn't have gone. That was a great discussion. Of course, Bush had wanted to go, and Scowcroft wanted to go. We thought we had the whole thing scoped out-- It just wasn't our year.

The other one was when we went to Japan. The first week I'm in office, they're going to Japan. The idea is, we're going to this summit, and we're going to take the American automobile manufacturers with us. They're going to make their pitches. They're going to be part of it, and we're going to try to push for American automobiles in Japan. We take their vehicles, they ought to take ours--open markets. Getting the three musketeers from Ford, Chrysler, and GM together was no small chore, but they all agreed to go. Then, all of a sudden, the press started criticizing us for commercializing a foreign trip by allowing them to go.

So until President Bush upstaged the entire situation, that was what we were fighting-- Why are we commercializing and politicizing the presidential visit to Japan? There was a big debate about whether we should do that. The political people thought we should do it. The State Department didn't like the idea. Teeter is very close to Ford, so he's pushing it pretty hard. We're trying to do something, and we're trying to do something that looks like we're helping the economy, which is selling American automobiles. And they have opened their markets, so it was good. But the press never gave it a chance. Other countries do this all the time, and we don't do enough of it--pushing for opening the markets for our companies like they do.

So, maybe there was a silver lining to the cloud of his throwing up. It at least took attention away--

Yes, off that. I guess you're right. It didn't look good, though. It doesn't make your President look strong when he throws up. And the truth is on that--I wasn't there, but I got this report. This is just the kind of guy he is. He knew he was sick, wasn't feeling good. This was just the flu, but he could not bring himself to insult the Prime Minister of Japan by not going to the dinner. That's just his culture, his work ethic. He's a man of total honor. "This is important, and I have to do it. I just have to get there. I have to buck up and do it." But he just couldn't do it. That's why people, I think, got the impression he was sick. He just had the flu. That had nothing to do with-- He continued to work out and was in good shape.

Coming to the end, even though you weren't at the White House, did you have impressions of the transition out and the incoming Clinton people?

Well, there was no love lost. I do have some impressions. For the President, once it was over, it was over, and he was really hurt by it. He took it very personally. But he stepped up to the plate like he's capable of doing. The transition went as well as any transition. But shortly afterwards, the Clinton people came in blue jeans--they violated just about every policy--no drug testing, no background checks, no dress code, pizza.

No background checks?

For a lot of them, they just gave them tags and said, "Go on in." They waived a lot of them. I don't even want to guess why they didn't do them. They couldn't pass that polygraph, a lot of them, I'll tell you that. That's the President's [prerogative]. If he wants to do it, I guess he's got the authority to do it. But early on, it just was a completely different image than the President was used to. You know the incident where Mrs. [Barbara] Bush called to get a little computer help from the guy who worked as the usher in the White House, and they fired him, because they thought she was spying.

So it didn't start off real great. I think it went up through Inauguration Day. They just sucked it up and moved. But, after that, they thought that the whole image of the White House--the exact thing that the President was worried about--was happening. The whole White House was being demeaned. It was being politicized. It was not being respected and everything else.

And that, by the way, I think is why this President, among other things--if you ask him what things he's done, he'd say, "One of the things I have done is bring dignity back to the White House." It's all coat and tie. It's all buttoned up. It's all by the numbers. That's part of it because they saw what it was like before and what it was like afterwards, and I think they felt strongly about the image. That's what the President was worried about. I don't think he fully understood that the American people could overlook some of the Clinton shortcomings because they were so upset with the way the economy was going, and they didn't see light at the end of the tunnel.

I must say I was surprised, too. In today's world, you don't hide much. You run for President, and by the time you get there, you've run the gauntlet from primary to general election, with all the press coverage that you get. You've got a pretty good idea of what the person is all about. That might not happen in New Jersey, if they replace [Frank] Torricelli with a stranger, but one of the reasons that [Frank] Lautenberg is doing so well is that he's a known quantity and has run for Senator three times in New Jersey.

I'm sure that his situation is he didn't want to run for Senator, but he wanted to be a Senator. Now Torricelli's resignation has given him a chance to not have to run but for a couple of months, and probably he'll become a Senator. With most people you know what you're getting. I think we probably had an inflated opinion of what the American people--or maybe distorted--as to what the American people would accept. Did that make a difference? Probably not.

In retrospect, as you look ten years back, I don't know there's a whole lot would have-- I think by December the handwriting was on the wall. I think most people in the Republican party, people I talk to--we don't talk about it much anymore--believe that, two things. Number one was breaking the pledge. Number two, not getting on the economy in July, right after the war was over. Those were the two things that, if he'd done that-- And, number three, probably, the President being able to articulate better during the election, as compared to Clinton, might have made a difference.

Because of little things--like looking at his watch during the debate--he became personified as someone who didn't care. I think he did care, a lot, but I don't think the American people really understood that, and we weren't able to convey to them that he did care a lot, and he was very conscientious, and he was doing his very best, and a lot of this was outside his control and their control, and it would take time. We weren't able to convince them.

They were convinced that this was a man who was taking them for granted--which he wasn't--didn't care about the economy--which he did--and, number three, was a lot weaker--healthwise or mentally--which he was not. They contrast that to a young-looking, enthusiastic President in a down economy, who keeps hammering away, who stayed on message--economy, economy, economy, economy, economy--and did not have the diversions that we did when you were being President. The Presidency can be a plus, but it can also be a minus because it can detract from your--

That's a question I was going to raise. You contrast Bush's earlier campaigns and his campaign as Vice President with his campaign as President and--besides the loss of Sununu or Lee Atwater and the down economy--this is not something that's, I think, within his view of the way a President should really be spending his time, going out, getting down in the dirt.

I think after all the years he's been doing it, he probably thought in this election, with what he'd done, he would not have to do it as deep as he did. And contrast that to his son, who's in his second year of his Presidency and is out there. He's the most traveled President in the first two years in history. He's out there all the time, doing tons of political events. He'd like to spend more time at his ranch in Crawford, but he works his schedule during the day. People criticize him a little because he takes time out in the middle of the day to exercise. That's the only way you can keep your sanity in that job, with the pressures he's got. And then he has all this extra stuff in this election cycle, which he's stepping up to the plate and doing. And no one hears him complaining one iota, or thinks he's complaining one iota about doing it.

Everybody else around him may be complaining of the burden that it's putting on them, but George Walker Bush is working, doing it, as if the election is tomorrow and he was running. The next three weeks, for example. I was talking to Andy Card recently. He says the President is out two or three days a week. He's out every week. He's wearing people down. They thought Clinton did a lot. Now, most of it's been domestic and not foreign. I think that's today's ballgame. Unfortunately, I think what the last eight years or ten years have taught us is that's what you have to do. You've got to do it to keep your majority in the House and the Senate. You've got to do it to keep your position for the election.

When you were with 41 in 1980 and 1988, did you find him to be somebody who enjoyed being on the campaign trail?

I don't think he disliked it. I wasn't as close to him. I would see him when he'd come and go. There's probably something to the fact that he was not as enthusiastic about campaigning in '92 as he was in '80, and I can understand that. It's why most people quit. Most people quit, not because they don't like the job--not President, but elective office--but because they don't want to do the campaign again. That's why people quit for Senator. That's why people quit running for Congress. That's why Governors turn it in. They just don't want to have that kind of lifestyle every day. You are owned by somebody else. You don't manage your schedule.

When I was in Transportation and in the White House, my wife reminded me the other day, "You complained that you're not in charge of your schedule." For someone who likes to control life and control things, not to be in control of your own schedule is very frustrating. I think not being able to, knowing that you can't say no, that you've got to go do this event, and you've done one thousand of them. It's perfunctory. It's great for the crowd and everything, "I saw the President." But on the scale of things, with everything you're working on, "Can I afford to take half a day out to go to an event for Jim Talent in Missouri versus working on the war on Iraq, so I don't make a mistake?"

That's a stretch of your time. That's why they'll all be glad when the election is over with. That's why they can't get anything done now, because it's so close. Every one of them wants to go to the wall, and none of them wants to make any kind of political mistakes.

It's 20 to 5:00 and time to wind up.

Anybody got any more questions? I want to answer all the questions that anybody has.

The general history questions. Are there some things that we're missing about Bush that people 50 years from now--

Let me ask you another question. What are the things--having talked to all of these people--that you really still don't quite understand? Let's take a couple of minutes to think about that.

Well, I'm not sure I understand. But with every interview that covers the subject, I learn a little bit more. There is one area-- When Bush is, after the Gulf War and approaching the election, there are some things about that--his reticence, his belief that the economy was turning around, his reluctance to make many changes. I think those things are going to be very hard for historians to understand unless they hear the testimony of the people who were close to that situation and know about it. And it's a little bit hard for me to understand, too.

I believe that he probably was not aware of how bad it was, and that there may have been reasons that he should have known it and didn't. By that time, certain people were worried about their jobs and were under the firing aim, and they may have been concerned that if they had told him the full scale of the problem, they would be gone. That happens in corporate America all the time. After a while, if you don't deal with it immediately, you don't tell your boss, because if you tell your boss, you're gone. It may have very well been that. I don't think that would have happened, but I think they may have thought that. So I think that when Mike Boskin says he couldn't get to the President, that's probably because it wasn't working the way people wanted, and people might not have wanted that. I wasn't there, but I don't know that. I think that is the main thing.

Number two, President Bush is a great believer in the free market, and he's not a great believer in a lot of federal intervention and gimmicks. Therefore, when he analyzed it, he probably didn't think there was a whole lot we could do--it would take time. And because he was older, he had seen it happen before, and he had confidence in it.

And then number three, he doesn't believe you should tell people anything that's not the truth. Has trouble using the media to the degree you have to use the media to put up a front, to pretend you're doing something when you're really not, so that you show that you care. He has a lot of trouble doing that because he thinks it's disingenuous and phony, and there's not a phony bone in him. He's an extraordinary human being. I don't want to leave this interview without making this point.

I've known a lot of people. I'm 64 years old. I've known a lot of people. He's an extraordinary man. He's smart, he's gracious, he's thoughtful, he's tough, he's fun to be around, he's concerned about everything. He is everything you'd want to be in a father, he's everything you'd want to be in a son, he's everything you'd want to be in a friend, he's everything you'd want to be in a boss. He's the full package. As I look back on it, one of the reasons I wouldn't want to go back is because I don't think I could work for somebody as great as he is. When you've had the best, you can never go back.

That's not taking anything away from any of the others. They're all good people, and I know a lot of them. There's probably one or two out there that maybe have the characteristics that he does. But I know him, know his family, I know a lot about him. I know Mrs. Bush--we haven't talked about her. A real trooper she is, a real, steady-as-she-goes person, who's been there through thick and thin. Running in politics, running for President is not easy. You know, the press, when they get on you, can be absolutely vicious.

I saw it up in Kennebunkport in May. We had a meeting up there. The Prime Minister of Israel was there, and the press just went off after President Bush in a totally inappropriate way on something unrelated to Israel, just so they could get their one minute in thing. You've just got to grin and bear it and take it. And there are not a lot of people who can take it with the style that he does. I hope the people who read this 50 years from now know that they were very fortunate to have a man of this quality as their President. If you look at history, and look at the quality of some of our Presidents--as I tend to do over the years--when it comes to quality, he's in a league that very few people are in. We had another one from Illinois who was that quality, but other than that, there are not very many.

I think the character of George Bush and his particular qualities and how those qualities explain a lot about the kind of people he got to join him and about the general atmosphere in the White House--I think those things come through pretty clearly out of these records, for future historians or for anybody who's interested in looking. I would hope some day, people who are contemplating jobs in the White House would want to read some of these records, to get the benefit of the past experience.

Well, if they do, it's a great experience. It can be some good times and bad times, but it's irreplaceable. No other experience like it. Where else would you get to dance with Princess Diana?

You didn't tell us about that.

I'll tell you this funny story before we leave, because it's a great story. I get a call--she's coming into town to raise money for the Royal Ballet to be shared with the American Ballet. I get a call from somebody who said, "Would you like to come as our guest?" It was the National Association of Broadcasters. I said, not thinking much about it, thinking it's a charity, I can go, I said, "Sure, we'd love to." So I tell my wife, "We're going to see Princess Diana, and we're going to have dinner."

I show up at the dinner, and immediately I'm approached by the U.K. Ambassador to the U.S. He says, "Will you join us at our table?" I said, "No, Mr. Ambassador, thank you, but I'm with the people from the National Association of Broadcasters." He said, "Well, Marvin is here representing the President." Marvin Bush and there's other people at the table. I don't know who he was going to kick out for me and my wife, but anyway. So I said, "Thank you." He said, "Well, you've got to do me a favor. Will you do me a favor?" I said, "What's that, Mr. Ambassador?" He says, "Marvin does not dance, and because of that, you are the senior ranking person here from the administration. Will you ask Princess Diana for the first dance?" So, I said, "Of course." He says, "I will tell her." I say, "Wonderful."

I go now back to my table, and for the entire dinner, I'm getting heat. "Do not mess this up. This is your big time. What are you going to say? How are you going to ask it? Do not bungle this. Do not embarrass us, your friends, in front of the world." So I say, "Okay."

The Ambassador has instructed me, as soon as the first note of music comes out, I am to get up, walk from my table over to her table and say, "Your Royal Highness, may I have this dance?" I do exactly as I've been told by the Ambassador. I get up, walk up, and say, "Your Royal Highness, may I have this dance?" She looks up at me. He has forgotten to tell her that I will ask her for the dance. He rushes out of his chair at the end. "Your Royal Highness, this is Secretary Skinner. He is the Transport Minister. He would like to have the first dance."

So, we are now dancing, just she and I, dancing on the floor, and we have some nice talk about children. She's very tall, you know. I take her back, "Thank you very much, Your Royal Highness." Everything's fine, other than this little faux pas, which scared her.

Then, my wife says, "I've got to get a picture of this." She calls people, talks to people as we're leaving, we'll get a picture. Never got a picture of her.

Next morning, I get calls in my office from the U.K., where my friends are traveling. "What have you done?" I said, "What are you talking about?" "The tabloids in U.K. have your picture--and it's really not you, it's somebody else--all over it, and they say, ?Government Cad Offends Princess.'" And it goes into the International Herald Tribune. I get three or four more phone calls from all over Europe. How could I have insulted Her Royal Highness and been such an oaf to invite her to dance, when she didn't even know who I was? That's a memory I'll have forever.

Me too.