Preparing to Be President:
The Memos of Richard E. Neustadt

October 25, 2000

Transcript prepared from a tape recording

Introduction:	Norman J. Ornstein, American Enterprise Institute
	Thomas E. Mann, Brookings Institution
Featured Speaker:	Richard E. Neustadt, Harvard University
Panelists:	C. Boyden Gray, Wilmer, Cutler & Pickering
	Reed Hundt, Former Chairman of the Federal Communications Commission
	Charles O. Jones, University of Wisconsin
	Ruth Marcus, deputy national editor, Washington Post
	Nelson Polsby, Heller Professor of Political Science, UC Berkeley
	Hedrick Smith, Hedrick Smith Productions
	Hon. Harris Wofford, CEO, Corporation for National Service

Proceedings:

MR. ORNSTEIN: [In progress]--along with my colleague, Tom Mann of the Brookings Institution, a project which has been ongoing now for almost 2 years and will through the election and the transition.

We have tried to focus on and cope with the era of the permanent campaign and get a little bit more of a focus on governing. We are working toward improving the nature of the transition and the appointment and nomination and confirmation process as well.

John Fortier, who just came in and sat down, is the director of the project, and we are doing this also in conjunction with the Hoover Institution and all funded by the Pew Charitable Trusts.

One of the first things that we did in this project was to try to pull together a whole range of materials surrounding transitions. I got a treasure trove of materials, particularly from the dean of Presidential scholars in our time, Richard Neustadt, and it seemed like a good idea to take this material which had never been published before which provides some stunning insights into Presidents, the process, and the Presidency, pulled them together and reflect upon them.

We got Charles O. Jones of the University of Wisconsin, another preeminent scholar, to annotate, edit, and pull the materials together, and Dick Neustadt also wrote a wonderful chapter both reflecting back and drawing lessons from these memos. It is all out in this book, "Preparing to be President: The Memos of Richard E. Neustadt."

So, today, we are going to have some discussion of this book and of the process. We have an incredible group of people to do so, and we are going, to make it work best, divide into two, the discussion. We are going to start with some comments by Neustadt, and it is a tribute to him, of course, that we have so many terrific people with us, and with a group of people who have more directly practiced the art of transitions and governing.

Harris Wofford will join us shortly. I will introduce him in a minute, but right now, we are joined by Boyden Gray who is a partner in the law firm of Wilmer, Cutler & Pickering. He served as director of the Office of Transition for the Bush transition team, as counsel to President Bush from 1989 to 1993. He also has served in a whole series of other positions in and out of Government, and is probably as knowledgeable about not just the transition process, but the White House, as anybody we have around.

Reed Hundt is a senior advisor on information industries for McKinsey and Company. Before that, he served as chairman of the Federal Communications Commission from 1993 to 1997, presiding over the passage and implementation of the Telecommunications Act of 1996, served as a champion of the process of dealing with the digital divide, connecting classrooms to the country over the internet, and was involved in the widest range of telecommunications issues, is the author of a new book himself, "You Say You Want a Revolution," a story of information-age politics published by Yale University Press earlier this year. Before that, he was a partner in the Washington office of Latham & Watkins, and also went to some private school here in Washington. What is it? St. Albans, I guess it was, played football with some burly guy named Al Gore.

Harris Wofford, who will join us shortly, is now the chief executive officer of the Corporation for National Service. He has been in that position since 1995. Before that, he was the United States Senator from Pennsylvania from 1991 through 1994. He served as a special assistant to President Kennedy, served as Pennsylvania's Secretary of Labor and Industry, and in a number of other positions including associate director of the Peace Corps.

After this panel, I will retire and let the editor of the book, Charles O. Jones, come up and moderate, and he will be joined by--and I will do the introductions now, if that is okay, Chuck, so that we can move right into the panel.

Nelson Polsby, who is here with us for several months now, from his base as the Heller Professor of Political Science at the University of California at Berkeley, where he has taught about American Government for 33 years.

MR. POLSBY: But who counts?

MR. ORNSTEIN: That's right.

Obviously, starting as the youngest professor at Berkeley in history, for 11 of those years, until last year, he served as director of the Institute of Governmental Studies at Berkeley. He is here now as a visiting professor with the Stanford program in Washington, and, of course, has written widely on the Presidency, Congress, party reform, and a range of other areas across the entire field of American politics.

Ruth Marcus, who is in the audience with us and will join us for the second panel, is deputy national editor for The Washington Post. She has been working for some time now supervising the team of reporters, working on money and politics, a fruitful area. She has been with The Washington Post as a reporter and editor for 16 years covering the Supreme Court, the White House, the Justice Department, and a number of other areas.

Hedrick Smith, who is here with us as well, is now the head, as he was the founder of Hedrick Smith Productions, an independent television production company that has done a whole range of documentaries. He is best known, however, for the time he spent here at AEI, while working on his book, "The Power Game," the best-selling book, "The Power Game." Of course, for many years, he was a reporter with The New York Times serving as the Washington Bureau chief, a chief diplomatic correspondent, and is one of the best known and certainly widest-ranging journalists in this town and in this country.

Let's start with Dick Neustadt giving us some of his observations, and then we will have some discussion.

MR. NEUSTADT: Can I do it just sitting down, or do I have to get up?

MR. ORNSTEIN: Whatever you want to do, Dick.

MR. NEUSTADT: Well, I mean, poor Boyden will have to be moving back and forth if we use that. Can everybody hear me with this thing, the way it is?

Well, this is a little bit like being dead, an honest definitive.

[Laughter.]

MR. NEUSTADT: When AEI and Brookings stumbled on these memos and asked me to let Chuck pick a selection of them and publish them, I was, of course, immensely flattered. When they asked me to then do a new memo on hazards for advisors as well as those they advise, that was a small price to pay.

The hazards are very considerable. I thought the best way to illustrate them was by things said or not said, done or not done, with respect to the memos I had written at the time, and I hope you enjoy that. There is a good deal of mea culpa in here, and it is deserved.

Now, I have fought for years that transitions were more important than American press corps or most scholars have noticed. All of that is changing. This year, I am happy to say every think-tank in town is concentrating on transition. A lot of material is being produced, some quite wonderful stuff, including the next book of AEI and Brookings which I commend to all of you on the permanent campaign. It isn't out yet, but it is a marvelous piece of work, and it puts this in a broader setting.

But the attention of the think-tanks is only useful insofar and if and as it attracts the attention of the press because only once the press really seizes itself of transition as a problem, worthy of notice, will the poor campaigners come to notice it as early as they ought to.

I expect there is a cycle here of if the think-tanks succeed, this time you are getting the press' attention, and then next time the candidates will think about transition as early as they need to, which is a lot earlier than now.

Why do I say this? To be summary about it, there are at least eight things--eight is an arbitrary number--that have to go on in the time between election and inaugural which is transition in the narrow sense. There is also transition in the broader sense that the incoming President has experienced everything that can happen to him in office, and that really takes up to the mid-term election of his first term. But in the narrow sense, transitions end with the inaugural address, about eight things.

There is going to be some rest and readjustment, especially for the incoming President. Not all Presidents give this to themselves. Mr. Clinton was notorious for coming in very tired, having indulged his adrenalin of all through the transition period.

You have to assemble the White House staff and the heads of Federal departments, and you have to sew up the procedure by which the sub-Cabinet of people will be selected.

You have to prioritize, slim down, reorient the things you campaigned on. If you do not get a grip on priorities, you will inevitably go up to Congress after January 20 asking for far more than Congress can possibly give you and providing far too few clues.

You have to nurse and feed the press corps that surrounds you unless you are in the situation Al Gore may be in if he wins where the incumbent President insists on maintaining the limelight until his last day in office. Most of them don't. So the press corps turns to the incoming President, and they need to be fed. They need to be nursed. They need to go to nice places and take their wives and children, not to Plains, Georgia.

[Laughter.]

MR. NEUSTADT: Then, sixth, you have got to initiate contacts with Congress, and that means more than your party's leadership. It means the other party's leadership, but it means strategic members of the two houses since leaderships no longer control their following.

Then, if you are Ronald Reagan at least and his people, you have to work out in considerable detail a plan for your first 3 or 4 months in office, what you are going to tyr to do legislatively, what you are going to try to do administratively, and how and with whom.

Finally, you have to enlarge your public image. Apparently--and I can't prove this with polling data. There isn't any that I know of. Americans, after the election, want to forget about the election. They don't like politics anyway very much, and they are interested in seeing the new man take office. They are interested in seeing him as President.

The inaugural marks an early point of interest, and this is sustained for the first couple of months, and it behooves an incoming President to look quite different as President from the way he looked as a successful candidate.

Take Jack Kennedy, for example. When he narrowly won, he was the fast-talking rich kid, Catholic, whose father had maybe bought him the election, if not worse. He managed to take office after that Inaugural Address as the President of all the people. It was an enormous, if unself-conscious, accomplishment. It is an accomplishment that is incumbent on every incoming President. Few of them think about it consciously, and even fewer manage to make that transition successfully, but it is imperative.

There are only 11 weeks to do all of these things, and sheer rest will take the first couple. So it is no wonder that hazards result, hazards of hubris, hazards of ignorance, hazards of time pressure. For Mr. Gore, there is the special hazard only previously encountered by President Bush in this century, and that is the hazard of taking office in a friendly administration so that all the people you want to get rid of, you have to pretend to like and you have to move them out delicately, tactfully, and carefully.

For Mr. Gore and Mr. Bush both, there is the horror, the sheer horror of the Ethics in Government Act and the legacy of the Bork nomination which those horrors don't appear in here, but we have someone, Boyden Gray, here who is fully able to testify about them. They are relatively new additions to our constitutional scene, created by the Democrats, I am sorry to say, in Congress, and they enormously complicate the task of assembling a new administration.

Now, I will gladly enlarge on any of this if asked questions that permit me to do so. We are all here to answer questions if time allows, but I think what I best do now is give over. We have lots of panelists, and they have lots to say.

[Applause.]

MR. ORNSTEIN: Thank you very much, Dick.

Just by coincidence, we got the first copies of this new book, "The Permanent Campaign and Its Future," in today, and on Friday morning here from 9:00 to 12:00, we are actually going to be having a program discussing that particular book as well.

Let me turn first to Boyden Gray, whatever observations you have, and then we can have some larger discussion about some of the points that Dick made, including, of course, the very interesting point about the stark difference between a transition within one party and one across party lines.

MR. GRAY: I do think it is an important distinction, and I think intra-party transitions are actually more difficult, the diplomacy that is required to deal with all of your friends who got you where you are, and it is very, very tricky. There is no special answer as to how to do it. It is just plain difficult, but it is not difficult because of the ethics regime that has taken hold. It is just difficult because of the interpersonal relationships that hurts and the slights and the pride involved, and that is, in many sense, a nice tragedy to have if you are Vice President Gore, but there will be times when he wished he hadn't won it.

But I do want to talk about the ethics regime. Perhaps I can add a little bit here. This took hold after the memos were written and put it in your book. So I thought I would go on this a little bit and then turn to an issue which, again, is a reflection of a development after the memos were written in your book, and that is the domestic side of the coordination problem that the NSC was designed to solve after the second world war. We now have a domestic side of it, and that needs addition. It has not gotten the attention of the press that I think it should, and since there is a press here, that is why we are going to talk about it a little bit.

The ethics issues, the clearances, the FBI, the congressional confirmation are all very, very difficult, and it takes 3 months to clear the average nominee. You can do it in a rush. We did Cheney over a long weekend, but he had been through this process, of course, as chief of staff and had had the security clearances. Had we had to start from scratch, it couldn't have been done that quickly. So you have the delay of the FBI. You have multiple forms to fill out and endless FBI forms that meanders all over your life. You have financial disclosure which is impossible to fill out accurately and fairly and honestly because none of the definitions of the financial disclosure form match up with the definitions of the Internal Revenue Code. An asset for one is not an asset for another. Income for one is not income for another. It costs hundreds of thousands of dollars for somebody wealthy--not that you feel sorry for anybody like that, but it is a real risk when you fill these forms out, and there is no way to do it right. There is no way.

It would help enormously if people would have the option of simply disclosing their tax returns in lieu of filling out these forms, but we know there is a cottage industry that is built around filling out these forms. So that has not happened.

Of course, if you wait too long to get your names up to Congress, Congress will be back in the business mode, and they will begin to hold the nominees hostage for their own parochial special interest concerns. So all of this says you have got to get going very, very fast. You have got to get your names and the clearance on November 8th or 9th, whatever date it is, so the FBI can start. You cannot afford to waste 3 months so that you can get your names up to the Hill quickly before Congress wakes up to what is happening. And I say this whether the Congress be your own party or not. You must move very, very fast, and in order to pick the people that you want to put in the process, you have to decide what jobs you are going to fill. That means prioritizing by necessity what your priorities are.

I think Reagan had a very successful transition because early on, they settled on about 85 names, if they thought of jobs that they thought they had to fill in order to start launching what they were going to do, and so the transition was, by and large, very successful.

But a reflection of where you go wrong if you are not ahead of the curve is with EPA. They bounced around from one nominee to another, and it wasn't really Ann [inaudible] fault completely that she ran into trouble at the beginning. She was just late getting started, and all of the [inaudible] were driven into the system. She had a terrible time getting on top of her own agency, and EPA remained a problem for Reagan for much of his terms.

You saw the problem that President Clinton had with the Justice Department and with other Departments. These problems lingered, I would submit, around his entire two terms. So it is absolutely critical to have the key jobs designated to keep people in the process. You don't have to actually announce what--or you know Reed Hundt with the equivalent of [inaudible], but you know he is going to have a job, hypothetically. You might not know whether it is going to be the FCC or the FTC or the Justice Department, but you put him in the clearance right away because you don't want to have to wait around.

One anecdote about the ethics clearance is it is very serious business, and the emergence of strong spouses has complicated matters enormously. My anecdote, of course, my favorite anecdote about this is not about the female spouse that creates a problem for her male [inaudible] Point B, but really the other way around. It was the male spouse who created problems for [inaudible] female, and I am referring to the Hills family.

President Bush called me--President-Elect Bush called me up one morning and said, "C.B."--that is how he would call me. He said, "I am announcing Carla Hills along with three others"--this was sometime in December or early January--"and I plan to announce her." I said, "Yes, sir, that's great." He said, "Well, there is a problem. She tells me that you haven't cleared her yet, some problem with a board that her husband is on, and she says until that is cleared up, she won't be nominated, but I do plan to nominate her." I said, "What if we can't get it cleared up?" He said, "That's your problem, C.B., not mine."

So I called Carla and said what's the problem. I mean, this is all being done by my staff, and she said, "Well, there is a problem. He is on the board of a steel company. We just can't get around the fact that I will be dealing with steel imports. He's got to get off the board," and I said, "Well, what's the problem with that?" She said, "Well, he is on a plane to Los Angeles, and I am not going to ask him. I can't take him off the board without his permission, obviously, and I am not going to do this to him and present him with a fait accompli." I said, "Well, what is the"--she said, "Well, he doesn't land until 4:00." I said, "Well, that's a problem." She said, "Boyden, that's your problem, not mine."

[Laughter.]

MR. GRAY: "I am not going on stage at 2:00 unless you have talked to Ron," and I said, "Oh, my God." She said, "Yes. See you."

So what did I do? Well, the statute of limitations is over, and I have said on prior occasions. We violated all rules by asking the FAA to patch us into the cockpit, and I talked to Ron in the cockpit. He thought it was very funny. He said, "Anything Carla wants, Carla gets." So this all happened 5 minutes before 2:00, by the way, and all is well that ends well. But these are very, very tricky issues, and you can laugh about this anecdote. I don't know what would have happened to me if I hadn't been able to get him in the cockpit.

All this says you have got to move very, very fast, and the people in the jobs which come to proxy for the prioritization that Dick is talking about is absolutely critical. I will not comment on the other points that he has made about the [inaudible] begin to look about his own persona, governing persona. I will leave that to others to talk about, but those are extremely important points, and I think they ought not to be ignored.

I do want to do sort of a little special interest pleading here on a point that is really lacking in a lot of the studies, and I am biased here or a conflict of interest and I am Chair-Elect in August [inaudible] Law Section of the ABA. So I have been struggling with this in a very bipartisan fashion. It is really the Democrats and the liberal members of this section pushing to have this focussed on, and that is what do you do about the regulatory process.

It is well known that energy policy in the United States is not set by the Department of Energy. This is well, well known. It is set by EPA. It is also well known that the people in the Department of Energy don't talk to the people at EPA. This is a fundamental problem of coordination. It is like the Army not talking to the Navy in the Pacific War. It needs to be resolved in the same way that the NSC, National Security Act of 1947, helped resolve those massive, massive turf fights.

This isn't the only turf fight, but it happens to be one because of the oil price of today that I use is very comparable. There is a mechanism for doing it. It is in OMB. It is a little office called OIRA known to AEI very well, but there a second head of OIRA, the Office of Information and Regulatory Affairs [inaudible], but it deserves the attention of everyone in this room because you can't have a whole bunch of agencies with competing and overlapping jurisdictions, competing and overlapping with each other in ways that are not coordinated centrally.

I don't know that there is any magic to this. There is a framework setup. There is an executive order that President Clinton signed in revoking a previous Reagan executive order, but they really are very much the same, and there is a bipartisan background for all of the regulatory reform, if you will, or watching the regulatory agencies. It goes back to President Carter, and actually, the biggest deregulator of all on the Hill, President Kennedy, counterintuitively perhaps, but he led the way on trucking and airline deregulation with the help of the current Justice of the Supreme Court. This has strong, very strong bipartisan support, but we ought not to lose sight of that. I just commend to you in mentioning all of this current--or maybe it is the past issue of Foreign Affairs magazine, the two lead articles is Japan, is the sun rising. No, the sun is sinking. The title of the article has been--the thesis of the article, that Japan's sun is sinking. The thesis is that Japan--the reason it is sinking is because Japan is not deregulating, and the thesis of the piece that says Japan's sun is rising is that Japan's sun is rising because it is deregulating. So you go figure which one is right, but deregulation is at the heart of this.

I am sorry that [inaudible] is not here at the moment, but McKensey and Company did a study several years ago showing the difference in growth rates, growth rates with the U.S. and Europe, are entirely attributable to the deregulation, and there is always CD studies that show the same thing in the telecommunications, utility industries. Maybe our former FCC chairman might comment on that, but U.S. has got a more robust economy because these industries are--or less more deregulated than they are in Europe and Japan. So this is an important thing for economic growth. I only mention it because it is fairly new and I will stop with one little anecdote.

The original executive order which put the coordination role in the White House where it ought to be in the same way that the National Security Act put the foreign policy in the White House where it ought to be was an executive order that [inaudible] was done in--and the FCC, by the way, is considered an independent agency. So it was never actually part of this clearance coordination process, although I think it should be and can be, but that is an argument for perhaps another day.

It was drafted during the transition. The transition sort of drafted during the transition, and it was presented to the Justice Department for clearance and for vetting the day of the inauguration, and it was signed by President Reagan on February 19th, less than a month after he had been in office.

We took the risk of not circulating among the Department because we didn't want it to be maw-mawed to death. We circulated the comments to the Cabinet officers on the Friday of that long President Day weekend when they were visiting their families and in no position to comment because they didn't have their general counsel with them.

When we showed it to the general counsel or acting general counsel in Room 248 of the Old Executive Office Building, they started reading it and they were scribbling and shaking their heads and grimacing and grunting and whining and screaming and then until they got to the last page and they saw President Reagan's signature on it and they said, "This can't be. This can't be." But it did work and it stuck, and it stuck through three administrations. I commend it to the attention of those who are going to be doing the transition for two opposing parties, Vice President Gore, charged with Reinventing Government. So he should have some familiarity with this. There are some who feel he is not focussed on the OIRA OMB clearance process as much as he should have.

So I just will stop with that, and turn it over to the independent agency.

[Applause.]

MR. ORNSTEIN: Thanks very much, Boyden.

We have now been joined by Harris Wofford who has been hung up with another problem that appears to be extending over into the transition which is the budget. Here on October 25th, these negotiations continue to go on, including those involving Americorp.

So thank you for breaking away from the negotiations. Is your time all right?

MR. WOFFORD: I am all right until I get signaled.

MR. ORNSTEIN: Until you get signaled, okay.

MR. WOFFORD: I couldn't be happier to be here and sorry that I am late, and I missed Dick's opening remarks?

MR. ORNSTEIN: I am afraid so, but we will give you an update.

MR. WOFFORD: I have been reading him for 40 years.

MR. ORNSTEIN: And we are about to hear what job Reed Hundt is going to have in the Gore administration, it appears from what--

MR. HUNDT: I don't think C.B. can get me cleared.

[Laughter.]

MR. ORNSTEIN: I would recommend Consul General to Bermuda, Reed. That is the best job.

MR. NEUSTADT: Innocent until nominated. Just remember that. Innocent until nominated.

MR. ORNSTEIN: You have both raised a number of interesting questions that I hope we can come back to.

One is really what has changed since Dick's original memos written for Jack Kennedy. Certainly, the Ethics in Government Acct and the whole nature of the clearance process has.

We know that when Kennedy became President, it took an average of about 2 months to get his nominees for executive positions into place, and in the Bush and Clinton administrations, it took just about 9 months. Is there anything else that is different? What kind of an additional set of obstacles?

The second issue really is what is going on now and what should be going on now before the election to prepare for that transition that begins and, as you both have said, has to begin immediately and with an enormous amount of energy on, in this case, November 8th, and we might get to that as well.

Let's turn to Reed, if we might, for some observations, and then we will turn to Harris Wofford if he is not called out of the room.

MR. HUNDT: Thank you very much.

I am here as another witness to testify to Dick's contribution to Government and to academic study both. These memos are fascinating documents that were all written, and this is what I think is so terrific about them. They were all written in the real world for people who wanted immediately to have the guidance who then really tried to put the guidance into operation, and this is an important book. Dick has performed an important service repeatedly for administration after administration, Republican or Democrat.

I would like to make my extremely modest contribution to this conversation by giving you an entirely personal, largely uninformed, and a musty story from November and December of 1992.

This departs from the scope of Dick's text, and I hope you will forgive me in regard to material for his next work.

This is my sense of what was important about the transition to the Clinton-Gore administration in November and December of 1992. First of all, it was a crucial fact, an essential fact--was the weight of opinion from economists that was provided immediately after the election to the President-Elect, Vice President-Elect to everyone who was part of the President-Elect's team, and secondly, there was the weight of opinion about corollaries politically to be drawn from that advice. Those are the two things. What was the economists' advice, and, secondly, what were the political corollaries to be drawn from it?

Those two facts, as I am about to describe, I think you can see proved fateful for the course of the history of this particular administration.

The economists--and I use the term very, very loosely and very broadly and I am sure that no two of them would think that they were in sync or that any one of them would think I am fairly describing their view, but I am describing the way that it was heard.

The economists all came in and told the President-Elect that he and his campaign had not overemphasized the importance of the economy, but had underestimated the severity of the economic problems that faced them. That was universally provided as the input.

Productivity gains at a maximum could only be about 1.5 percent. Economic growth at a maximum, if I remember right, could be only around 3 percent. Unemployment could not drop below some number, around 6.5, 7 percent. These were absolute hard-and-fast rules. They were written in the concrete that economists see rules written in. They totally bound everyone, and all options were limited.

The significance of this was then explained when Dick Darmon came and communicated, and I wasn't there if he came in person. I can't recall whether it was in person or whether it was by some other means of communication, but what was communicated was this, that the estimates for the budget deficit for the next year and for the next succeeding years that had been used in the campaign by the incumbent administration were far or worse--or excuse me--the estimates they used were far less than the reality. In other words, the budget was in much worse shape than had been explained.

So that was part of the general economic advice which is Mr. President-Elect, you are in very, very serious trouble by reason of structural deficits in the budget process. Your options are extremely limited, and by the way, if you don't follow the handful of imperatives that we are now going to explain to you, we can absolutely guarantee to you that in January of 2001, the Presidency would not be worth having.

I remember that Vice President-Elect had a very negative reaction on a personal level to that particular prediction.

[Laughter.]

MR. HUNDT: So what were the corollaries that were then explained? The fundamental, most important corollary was that it was an imperative for the Federal Government to step in and figure out how a tremendous inflation in health care costs could be suppressed, and also how spending by the Federal Government on health care would be reduced. That was said to be the primary corollary of this extremely dismal economic situation.

Many commentators since this date have said that the President made some sort of stake in deciding to do health care instead of welfare reform. Many people have assumed that there was something whimsical about the commitment of Hillary Clinton in IRA [ph] magazine, tremendous political capital to the health care reform system. I don't buy any of that. It was very seriously thought through. It was decided that the primary firepower and political capital and personal capital of the administration needed to be directed at that target not because it just seemed nice or some arbitrary method of reasoning was going on, but because the economists said that it was the primary corollary, and the secondary corollary was that it was imperative to send up to the Hill a budget that emphasized revenue-raising and that was stripped of the middle-class tax cut that the President had promised.

This was not something he wanted to do. It was something that every economist in the country from the right and the left said was an absolute imperative.

What they didn't say was this. They didn't say the following. Everything we are telling you about productivity gains, unemployment, and growth is false. We now know that is true. They didn't say that. They didn't even say that it might be false. They didn't even say that there was some flexibility in these assumptions. Everything that they said was absolutely rigid was completely wrong.

They also didn't say what Boyden say which was true, but they didn't say it, which is your primary purpose really ought to be to figure out how many sectors of the economy you can deregulate so as to drive investment, so as to produce new job creation, so as to get productivity gains. They didn't say that.

For another reason, which is outside the scope of this particular discussion, that is what happened in the communications sector, and the academics now say that the primary reason why we have the most robust economic growth in the information sector of any country on the planet, other than Finland with which we are tied, happens to be the fact that we have the most robust competition policy in the communications sector. I am not saying it is perfect. I am saying go to Japan if you want to see the truly imperfect version, and that is the fundamental reason in my view why Japan's economy has been more [inaudible] for 10 years. They have missed the information revolution because they would not deregulate.

So we are entirely in sync on that. We are in sync on something else. I was Carla Hills' law partner, and that phrase, "It's not my problem. It's your problem," that really rings true.

[Laughter.]

MR. HUNDT: But she is a great public servant as well.

So this is what actually happened in the transition. Now, what does one think about that with the benefit of hindsight? Avoid all advice? Don't listen to anything anyone tells you in the transition? Listen to everybody but the economists? I am not exactly sure how one rightly should interpret this particular evidence of history.

I think that what it does demonstrate is that--and I can't speak to nearly the number of case histories of transition that everyone else here can talk to, but I can speak to this one, and I'd love to be able to speak to another one. But I will say this about it. I think that immediately after the election, what transpires is that for at least some period of time, almost everyone in the country agrees that there is just one President and that they all would like in some way to help that President. This is part of the genius of America. Republicans and Democrats agree.

The problem is that it is not true that just because everyone wants to help, there is also one wise consensus about what to do. So what actually transpires is there is a tremendous heterogeneity of people and points of view that are showered down on the President-Elect and on the new administration, and the net effect of averaging all of that advice is not, therefore, to get the right answer.

What do you do instead? And this is the hardest question, and I am just going to leave it open as a question, but I do know this. The guidance given to President Clinton by a wide range of people--and I am absolutely not speaking now of his closest advisors, but rather the whole new mass of Americans that say things--that guidance, particularly on health care, we all see and he now says was fundamentally flawed. The problem was not as big as that, and that wasn't necessarily the right place to focus all of your resources in order to address the problems that did exist.

The one person who I think history will judge to have been a wise, steady, very low key, very muted, very close to the vest, and extremely intelligent advisor was Bob Rubin because, with all that other advice going on--we can see whether Bob does or doesn't agree with what I am now saying when he puts this in his book--I don't think he paid much attention to it. I think the one thing that he paid attention to was making sure that what went up to Congress was a budget that would, in fact, deal aggressively and quickly with the macroeconomic situation.

It wasn't dealing with what might or might not happen in the health care. It wasn't dealing with a whole range of other issues. That was the one thing that he wanted to deal with, and studies now show that the one thing in that budget that was phenomenally successful was this, healthy appropriate taxes on the top 1 percent in income in the United States.

I know you all think I am making a point that I intend to have resonate in this election. I do. That is exactly what economists now say is the number-one single reason why we went to surpluses so quickly because it happened in the succeeding years that that same 1 percent received a disproportionate increase in their income from the benefits of the economy primarily driven by capital gains.

From 1995 to 1997, the top 1 percent of tax filers went from $398,000 a year to $512,000 a year, a 131-percent increase in just the top 1 percent in just 2 years, and that is the group whose contributions because of OBRA produced the surplus that all the economists said was exactly impossible.

MR. : Very nice.

MR. ORNSTEIN: Thank you, Reed, and you were so lucky that you came into Government at that point and moved out of the top 1 percent.

[Laughter.]

MR. ORNSTEIN: And then you left and moved back in just when you were about to get a huge tax cut possibly to make life even better.

Harris Wofford.

MR. WOFFORD: Thank you very much.

I don't want your warm breathless introduction of me or my breathlessness to suggest that I think that I am central to these negotiations. Once again, in the third transition that I have been interested in, involved in, I am very peripheral. We do not quite reach a billion dollars, and we have already gotten our money and we have done well for the fourth year, that is, the Corporation for the National Service, Senior Programs, Student Service Programs, and Americorp. It is three wings, contrary to what you have read because you have read that each year when the House committee cuts us to nothing that we are being terminated, and each year for 4 years, we have had a significant increase and we have gone to 40,000 Americorp members which is more than the Marines which we are recruiting for. We have had 200,000 now serving or will be serving this year in Americorp which is far more than the Peace Corps in 38 years.

But we are peripheral because we have got our money, but we want reauthorization as a simple and as a steadying influence for the 700--[audio break].

[Side B of Tape 1 of 2 begins.]

MR. WOFFORD: [In progress]--and on national, are interested in, and have grants from us for national service resources, and that is a very peripheral part of this Labor/HHS multi-billion-dollar bill that is being negotiated, but we are trying to get in it and in every possible way from General Powell, one of our main champions and partners, to the President of the United States. If I get a page, it could be bad or good news, but I have been peripheral to three transitions, and I think I have two points about the three transitions.

First, the one that involved me deeply in my life, I was only 7 years old. It was Roosevelt's transition, but by the time I was 10, I think the 100 days of Roosevelt's action and the Fireside Chats were what moved me from being a member of a non-political Republican family to not driving in the family car to school in the 1936 election because it had a Landon Republican sunflower sticker on it, and I was for Franklin Roosevelt.

I think it was long before Dick Neustadt started comparing the transition of Franklin Roosevelt and 100 days to what was possible in 1960. I had the example of the Civilian Conservation Corps which is very much in my mind right now after I gave you those boastful figures. Roosevelt learned that when he came into office first week that there were 500,000 young men estimated to be on the streets unemployed, didn't finish high school, and he said I want those boys in the woods. And he told Francis Perkins to have a plan within 10 days, to have a plan that would get those boys in the woods to work on our hardest problems of our public lands and turn their lives around, and she had the plan. And 10 days later, Congress passed a 1-1/2-page bill authorizing the President to spend whatever funds are necessary to get 500,000 young men in a Civilian Conservation Corps.

At the end of his first month in office signing the bill, he said, "I want a quarter-million boys in the woods by the end of summer." Four months later, General George--Colonel George C. Marshall who had been picked to organize the camps reported that there were more than 300,000 young men in 1,600 camps. Those were the days of Big Government.

But we then--what did I love about it? Of course, it was the boldness and going to scale to deal with the problem on the scale that was necessary. By the time t he CCC men graduated into national service of the military kind, 3 million-plus had been--many of them done great work that still lasts, and their grandchildren are seeing it and turned their lives around.

Roosevelt was bold, but he was also, of course, cocky, which is part of what we liked and it worked. Kennedy--I was helping Sergeant Shriver on the talent search for the beset and the brightest, but the President-Elect already had found one without our having to search in Dick Neustadt and his writings and his talk which was probably more important even than his writings.

But the day before the inauguration, Shriver and I took our final files over from the talent search to the White House and joked that we had found a job for everybody except ourselves, and pretty soon we had the Peace Corps and I had civil rights. And both of them--the one, the Peace Corps, was close to Kennedy's heart, very much like Americorp is to Clinton, but it was peripheral to foreign policy which was the greatest interest and the greatest pressures. So was civil rights peripheral. He wanted to do right by it. He wanted to clean up the mess. He said you know what to do, find out how to go do it and do it, but it was always a problem to get anywhere close to his priorities until--on civil rights until there was a protest, until there was a crisis of Freedom Riders road.

Cockiness and boldness were both in the spirit of John Kennedy. I suspect that the cockiness was part of the price that we pay for the Bay of Pigs, but in any case, the CLInton transition--I was in the Senate having ridden in, in part, on the health care issue, and I don't think there is any question but the cockiness was a part of the downfall of the health care plan. It was a much more thoughtful plan. It was a maximal plan. It had something that probably very few of you realize. It had a major check in the HMO growth because its plan as a key part of it required that every employer plan--and that was the base of the plan--should require three options for workers to choose, and one of which would be a fee-for-service, choose your own doctor. It would have been an enormous check on the growth of HMOs, but we didn't compromise early enough, we in the Senate supporting it, and we of the administration--they of the administration then deal--we didn't deal with Dole. We didn't compromise and sit down and work with John Chafee, and I think cockiness--there was a boldness, but you couldn't get away with what Roosevelt had.

I guess it is partly Roosevelt had the immoral equivalent of war in the Great Depression, but there may be some other reason.

So now, in the current transition, which is going to be of great interest to me, for the first time I have real objectivity in one sense because the one thing I know is I don't want any job, and that wasn't the case in 1960, but we have an agency as sort of a counter-point to a lot of Dick's advice about the creative power of the executive branch and the Presidency to change things by the use of Presidential power.

I am facing the interesting thing of an agency that is also peripheral because it isn't--as James Carville said to me when we wanted to make national service which we got in the Senate, unlike health care, a key part of my reelection campaign, he said to my wife who finally bored with the idea, wanted it to be a key part of our campaign--he said, "No one can make national service--Claire [?], I tell you nobody can make national service a political issue. Nobody thinks it is going to really solve the important problems for them. It won't affect one vote."

Of course, Rick Santorum opened the debate against me saying, "What did Harris accomplish? All he accomplished was the national service bill and Americorp, and what's that? It is a program for hippie kids to hold hands around a campfire singing Kumbiya at taxpayers' expense," and I wouldn't be surprised if the 40,000 votes that made the difference shifting might have come from that line which was very potent, but, in general, it is obviously not a big issue.

The President said it is the transcendent idea of his administration, but right now in the negotiations, despite 49 of the 50 Governors writing a letter to the leaders of Congress, despite what the President says, no one is taking is seriously as a major factor, no one except maybe John McCain and some key people in Congress and the country that want to lift our sights to asking not what your country can do for you, but what you can do for your country.

Last point that I was moving toward is it is almost the opposite that I am worrying about now about how creative Presidential power can change things because our top officers of national service have all gotten interesting, terrific job offers. All of them know the political team, although I have no political appointees left in the agency--I decided it is part of the effort to be completely bipartisan to not replace any of the Schedule C appointments, and we have now no such appointment, but the discretionary top team all know that a new CEO is very likely to want their own team. One by one, the key people have left, and fortunately we have some good civil servants behind them, but it has been a drastic change that will slow down a lot of important work for 6 months at least, and it will be how many months before a new CEO is picked and confirmed.

Both candidates are for us. Both candidates have supported the State programs. I mean, George W. has supported the Texas program strongly, and Gore has been a full supporter. For both, I am sure it is also a peripheral matter, and there is a question in my mind whether in an agency like this, at least now the Smithsonian model which avoids Presidential power in a transition, which has its board picked partly by the President, partly by Congress, which has fixed terms for the CEO, where the CEO is not picked by the President, you lose the power of a President to really change things, but there would be some great value to show that this was an institution of the American people not just a Presidential institution.

So I at the moment am tempted with almost the opposite of all the things I believed in, in most of my time, that is, Presidential boldness, Presidential power, Presidential ability to really change things.

I sort of now look over to the Smithsonian and say that would be a very interesting model for a national service.

MR. ORNSTEIN: Thanks very much, Harris.

Just one question for you. If that model doesn't change, do you anticipate that the next President is going to be able to get a selection of the best and brightest moving in not at the top position, but at the levels further down the schedule?

MR. WOFFORD: Oh, actually, I am fairly optimistic. Governor Mark Roscoe, a Republican Governor of Montana, is a member of our board. He is probably the strongest champion of Americorp in the country. He is the one that got 49 Governors to personally sign the letter for us. He will be a very active influence.

If George W. should win, we are similarly--we have several other top Republicans close to Bush, including the head of our National Service Commission in Texas who is one of his best friends, and on the Democratic side, I think we are well positioned, but there is this other problem of being peripheral.

It is a bigger question. Senator McCain has said after this election, he wants some of us that believe in national service, and he changed his mind on Americorp and announced it, but he said to believe in a call to service again, to start plotting outside of the politics and the legislation, how we get a real call to service that would include military service, Peace Corps service, domestic Peace Corps national service of the Americorp kind, service by Jesuit Volunteer Corps, and a call to service that can engage young people on a large scale, larger than the CCC and full-time patriotism on the homefront.

MR. ORNSTEIN: Thank you all for interesting and different contributions.

We are going to take a couple of minutes, just a few for questions for this group, and then we will move on to our next panel.

Yes, Paul. We have a microphone up here, right up at the front. Please identify yourself.

MR. MANN: Thanks, Norm. Paul Mann from Aviation Week.

A question for all of you. Are the interpersonal relations between a President and his Cabinet Secretaries crucial to the point of being determinative of the success of his administration? What about personal chemistry?

MR. GRAY: Yes, I think it is pretty important. It isn't absolutely essential to have a working relationship prior to the assumption of the Presidency, but I do think that if you end up with someone who is one of your top Cabinet appointees with whom you simply don't have a good chemistry, I think there can be some trouble.

MR. MANN: How much thought is given to that ahead of time?

MR. GRAY: Quite a lot, actually. I think quite a lot. I am not sure that that is a problem. I think that the President--you don't have to tell the President about whether he wants to be compatible, but you have a--Richard, I think has a much longer view of this than I do, but I think the Kennedy and--Kennedy got along with most, not all.

There were always rumors about Jack Kemp and Jim Baker, you know, getting into fisticuffs in the Cabinet room. You want to avoid that kind of thing, but it is important, and I think the success on a parochial note, success of the Gulf War and all of that, the Berlin Wall, the way President Bush managed a lot of the big change that occurred in his 4 years was dependent on the great chemistry between his foreign policy team, all of whom to each other and got along very well together and this was a very important thing.

MR. MANN: Let me frame my question precisely. What I should have said is I am sure the President thinks about how his Cabinet Secretaries will get along with him. Does he also think about how they are all going to get along with each other?

MR. GRAY: Well, that was part of my point about the Gulf War. I think President Bush wanted to have a coherent, cohesive team, and he thought a lot about it, but I can't speak for Kennedy or Johnson.

MR. ORNSTEIN: Let me ask you this, Boyden, and Reed as well. When Vice President Bush was running in his own right, had he by September or October thought through what kind of Cabinet appointments he would make? What do you think about Al Gore at the moment, Reed, and what about Bill Clinton in 1992?

MR. GRAY: I will say I am sure--

MR. ORNSTEIN: Did that just start after the election was over?

MR. GRAY: I am sure President Bush had a very good idea before he was elected.

MR. ORNSTEIN: What about George W.?

MR. GRAY: I think he has a pretty good idea, too, but he is not going to tell anybody because all of these people who have pens in the room would start writing, and then the attacks would start. The people who don't like X, Y, and Z would start to writing attacks, people starting [inaudible] and the FBI with all sort of rancid gossip about X, Y, or Z. So it is better not to float the stuff and to run the clearance process, flat out, whether there are any skeletons or not. This is one of the tricky things about this [inaudible].

People don't understand the FBI gets now penetrated by enemies, and the enemies can be your own friends, somebody who wants the job more than somebody else who wants the job, and so you want to go through the clearance process before you float the name.

MR. ORNSTEIN: Yes.

MR. : A question just for anybody who wants to answer.

MR. ORNSTEIN: Identify yourself.

MR. : I'm sorry. I am Evo Dolderate [ph] at the Brookings Institution.

The particular between the President-Elect and the transition team and the actual administration that is still in power can be a tricky one, particularly in the foreign policy area.

In the Bush-Clinton transition, you had decisions with regard to major treaties, whether or not they should be signed, as well as a deployment of a major military deployment into Somalia after the election.

You have the prospect now of historic visits to North Korea, problems in the Middle East and what have you. How do you relate as an outgoing administration to the incoming administration? Do you inform? Do you ask--do you do more than that? Do you ask permission? What is the relation?

There is only one President at any one time. Nevertheless, the decisions made in November, December have particular influences in what happens in January, February, and later, Somalia being the key example in 1992 and 1993.

MR. : I think put your own common sense to work on this. By and large, the outgoing administration always wants the incoming administration to take more joint responsibility than the incoming administration if it is intelligent wants to take or ought to take since, as you say, there is only one President at a time constitutionally.

Well, more than not, the outgoers, once they get over their chagrin, are deeply eager to be helpful because they figure they have learned their way around. They understand how to do these things, and they are sure the new people don't and they want to help them desperately. So these two impulses operate. They want them to take a share of the burden, and they want to be helpful.

The new people are, you know, usually too busy and self-important to take full advantage of this, but not too busy to appreciate the trap of taking--of associating one's self with decisions one hasn't made one's self. I think that is pretty general.

MR. : Yeah. Well, Boyden will have a much more specific view.

MR. GRAY: Actually, I'd go back to my father's time, some of which is--a little bit is in your book about the transition between Eisenhower and Kennedy, and I was a freshman at Harvard and full of--you know, and made the Crimson Ball competition in my freshman year and, you know, big news, [inaudible] and go be national security advisor, and a lot of excitement at the Harvard Crimson. God, you can well imagine [inaudible] what a great assignment this was.

And my father, of course, was the outgoing NSC advisor, and Mack Bundy charged in and just totally tore up everything that he had spent a good part of his life building.

Now, there had been a little ossification in the NSC clearance process. So some housecleaning was certainly in order, but one could argue that it led directly to the Bay of Pigs. After it was all over, Mack Bundy went crawling back to my father, went back to him and said, "Now, Gordon, how actually did you do this?"

So there are some times that outgoing administrations do have something to offer incoming.

MR. : Almost inevitably, they got a lot to offer.

MR. ORNSTEIN: We will take one last question. Brad? Wait for the microphone.

MR. PATTERSON: Brad Patterson.

Just to recast the opening question a bit about relationships, how does an incoming administration think about, work toward smooth relationships between the Cabinet and the White House staff? Thinking back to the Kissinger-Rogers problem, the Brzezinski-Vance problem, how is this thought about, planned for, in the transition by a new administration?

MR. : Well, I can--I know something about some of these. In all the ones I can think of, there is underplanning, and there is over-optimism of--or sometimes simply no recognition that the problem is going to arrive, but in the Nixon case, I am pretty clear that Mr. Nixon put Henry Kissinger in the office he put him in and put Bill Rogers in the office he put him in with a very clear notion that he wanted State under control, but out of his hair, and he was going to run foreign policy from the White House. That was certainly thought about in advance.

Mr. Kennedy, I remember of my own knowledge, he didn't know either the Secretary of State or the Secretary of Defense. He knew Mack Bundy.

When he appointed them, he had met them once each, except for Bundy, but he assumed Bundy would be the intermediary between them when the Secretaries were too busy to answer his phone calls. Bundy was sort of to be the living link, and he assumed that Rusk with his experience would be like McNamara, a hard-driving, analytic, fast-talking fellow, and they'd have creative arguments. Uh-uh, no.

Rusk in the atmosphere in which he found himself clammed up, and it took years before Kennedy began to understand that he was part of the cause of Rusk's clamming up. I think that is important. There is a great--they don't think enough about these relationships, mostly because they don't know enough to think about them enough.

Bundy and Kennedy abolished all of the machinery in Gordon Gray's neighborhood by press release one morning, and the press release said the Secretary of State will figure out what should be put in its place. The Secretary of State never heard about this, and if you know Rusk, you know he is the last man in the world who is going to act without instruction from the President on a subject like this. So nothing was put in its place until after the Bay of Pigs. They saw the need for some structure and created it.

When you have somebody like Mr. Bush coming in, who spent years thinking about the NSC and participating in it, you get the opposite, and if he appoints an NSC advisor who has already had the job once before, to whom the President is personally close, you get a lot of thinking, but there is no formula here.

MR. ORNSTEIN: I want to thank you all very much for what you have done here, and now we are going to make our own transition. I am going to turn the podium over to Charles O. Jones, the Hawkins Professor of Political Science Emeritus at the University of Wisconsin at Madison, a very distinguished political scientist whose many books include passages to the Presidency from campaigning to governing to definitive study of transitions, and I will also ask Nelson Polsby, Ruth Marcus, and Rick Smith to come up to the front and we will move onto the phase two.

[Applause.]

[Pause.]

MR. : If we could get underway, it would be a good thing.

As Dick Neustadt noted in his introductory comments, every thinking group--let's put it that way--in town is thinking about the transition. Never has so much fine work been done by way of thinking ahead, and a lot of the work has been underway for quite some time with fine materials being produced. In addition on paper at least, these are two candidates, again, on paper, who would appear to have more capability for producing effective transitions. So I guess the principal message here for the winner is don't screw it up.

My job, as I understand it, is to see if I can get these folks to talk, one of the simpler assignments I have had in my career. I would like to start with a question for Dick and Nelson, which is a variation of that, that Norm asked last time, that is, what is different from the time of John Kennedy or even other more recent Presidents, and focus it a bit by asking this question of Dick and Nelson in turn, and the other certainly contribute, too, what to do about Clinton for the winner because this is not just--it is true we have one President at a time, but this is not just a President. This is a President, all right?

So, Dick, do you want to react to that?

MR. NEUSTADT: Well, it is my guess--a pure untutored guess--nobody has told me--that Mr. Clinton is not going to be a bit like any of his predecessors in memory, that he is going to be as active in that place as he can be until 12:00 noon on January 20. He is going to have press conferences. He is going to make trips. He is going to make announcements. He is going to issue opinions. He is just going to have a final [inaudible] of a time.

Most of them go into semi-hibernation until their successors take over. That is my impression that is not going to be what happens. So it is a unique situation, and it might be a good one for the incoming President.

Actually, I can see advantage in it. He can go through those eight things that I talked about of much less noticed because the other fellow will be out there making waves constantly, and it is a new situation, in my view.

MR. : Okay. I have got a historical analogy, Theodore Roosevelt who was very young when he left the Presidency and was strongly disposed to keep a hand in. So I guess the consensus is probably going to be if Gore is elected, it will pose something of a problem. If Bush is elected, I think considerably less so.

There is also one other contingency, and that is, of course, if Mrs. Clinton is elected to the U.S. Senate, the President can always join Mrs. Clinton's staff as an intern.

[Laughter.]

MR. ORNSTEIN: Ruth and Rick, do you want to react to that?

MS. MARCUS: I can't follow that.

I think that the notion in the modern--I think what you are saying is very interesting about the likelihood of a continuing activist Presidency, but I think we have all become so attuned to covering transitions that the ability of a President to operate--kind of a President-Elect to operate in kind of near seclusion during a transition is a nice dream of theirs, but good luck. We will all be in Austin or here paying attention to the next guy even if the current inhabitant of the White House is fermenting trouble until the last hour of the last day.

MR. : Can I ask a question within the question?

MR. ORNSTEIN: Absolutely.

MR. : Ruth, if it is Gore, by chance, and he comes back to his house, which he now has here, will there be one White House press corps or two?

MR. : The answer to that, there are three. There actually are three White House press corps. There is one for each person that we are thinking about. There is the Clinton White House press corps. There is a Bush White House press corps in waiting, if he wins, and there is a Gore White House press corps. There are people whose own journalistic careers are riding on the winner, and just as there is this awkward business of replacing the outgoing administration for politicians, there is this awkward business of replacing the outgoing press corps.

Now, there are certain fixtures--Sam Donaldson used to be one. Helen Thomas used to be one--that go on from administration to administration, but you can bet your bottom dollar that The New York Times and probably The Washington Post and a number of other organizations, the reporter who has been the principal reporter on the candidate is the one who is expecting to become the next White House correspondent.

So, within the news organization, if you have the situation we are talking about, there is also going to be this kind of jousting and rivalry.

MR. : They won't be seen in place at the same time.

MR. : That's right.

MR. : They will?

MR. : They will both be in place at the same time, but one clearly sunsetting and the other clearly sunrising.

I don't know. Ruth has the managerial responsibility.

MS. MARCUS: The awesome managerial responsibility.

[Laughter.]

MS. MARCUS: We definitely will go through our own transition, and there is that kind of sunsetting thing with outgoing White House reporters and incoming White House reporters, and one of the things it brings up is while there is--we need to learn from our predecessors as well. One of the things that happens when a new administration takes power is this whole new set of White House reporters who are as wet, if not way wetter, behind he ears than the crew that is taking power and the things they have to learn from some of the folks, including some people in this room, who have been around and seen it before.

Reading [inaudible] Jones and [inaudible] Neustadt's book reminds me of just how absolute little and not inadequate amount of preparation I had for the Clinton transition in '92 to know what was new and what was to be expected, and while we spoke to many academics, we can't be prepared enough and we can't have enough institutional memory ourselves.

For me, the most pointed and continuingly painful reflection of this came on Veterans Day in 1992 when President-Elect Clinton was asked about his promise on gays in the military. I had, as anybody else, heard him say this numerous times on the campaign trail. Well, from my completely ignorant, untutored measure of news, if a guy has said something 50 times before and he says it again, it just goes right through the filter. Well, duh, there is a very big difference between what a President-Elect says, as you have written about, and between what a candidate has [inaudible] in times. Obviously, the fact that Clinton was willing to simply say again what he has said before was of huge significance, and I tell that story because it was of huge significance for me because it really is reflective of the learning curve that we all need to go through as we make our reporting transition from covering a campaign to covering a White House.

MR. : Chuck, can I get into this a little bit?

MR. : Go ahead.

MR. : I would like to give you an impression from very far outside about how transitions are, in fact, covered. They are covered almost entirely in terms of the symbolic politics that the President wants to convey.

I think one of the great advantages of now having Dick's memos in the public domain is that he raises an enormous number of very interesting issues that Presidents-Elect have to actually confront and which are so far as I could see virtually never, never actually discussed in the public prints during a transition.

I do think it is important to know surely how many Hispanics there are in the Cabinet, but keeping score on stuff like that is, so far as I could see, virtually--certainly the main thing that news coverage is about during transitions, that is to say, which interest groups consider themselves gratified by the first round of acts, but Dick raises an enormous number of very interesting issues about how a Government will actually operate, and what I am wondering is whether--particularly Ruth, but maybe Rick could also say whether they anticipate that some of that will leak into the coverage, if you like, or consideration of how Presidents are doing while they are doing these transitions.

MR. SMITH: So [inaudible] a question of my own that I would like to ask Dick that I am hesitant to get too far into this, but I think--

MR. : Well, we had that problem in the debate, too.

[Laughter.]

MR. SMITH: You really know how to hurt a guy.

It seems to me as I was listening to Dick, to pick up on your question--I was listening to Dick say, in answer to an earlier question, whether not all of the activity of the think-tanks is going to be meaningful is going to depend on whether or not the press corps pays any attention because it is going to take the press corps to get the candidate and his entourage to pay attention.

I thought there were a lot of people disturbed by the increased role of the media in American politics today. I realize we are going to have to take that part on.

But part of what I think the answer is going to be to your question, Nelson, is whether or not all this think-tank activity and the kind of work that Dick has done is done a bit more publicly and with some benchmarking as you are going through the transition period. Nobody has ever thought of that.

What happens is Brookings and AEI and Heritage come out with these massive tones. They hold a press conference, and they dump a whole lot of policy prescriptions on the table and hope they get coverage and walk away, and then it gets handed off to the transition task force.

There is no incentive to get in any kind of a dialogue. I think of Jimmy Carter, for example. Matter of fact, I was struck by, interested in, and missed the fact that there were any Dick Neustadt memos to Jack Watson who was Jimmy Carter's transition chief. I don't know if he wrote any, you just talked to him, or he never even asked you.

MR. NEUSTADT: No.

MR. SMITH: But what was very interesting about Jimmy Carter's transition and had we had some kind of benchmarking with people who were knowledgeable about this, there might have been more [inaudible] because it is very important.

By the time we got to the day of inauguration, Jimmy Carter had not actually decided who was going to be his chief of staff. Jack Watson had been designated as his chief transition officer. Jack Watson assumed he would be the chief of staff. Ham Jordan [?] who had run the campaign had absolutely no interest in governing whatsoever. He was a campaign junkie. He loved it, but he was--God damned if he was going to let anybody else be chief of staff. So he didn't want to be chief of staff, but he didn't want Watson to be chief of staff.

MR. : Right.

MR. SMITH: The result was that when the Carter White House staff met on Inauguration Day after the parade, they all sat down at a meeting and nobody knew who was going to call the meeting to order. Bob Litchitz [ph] who is the President's counsel said, after a while, "Well, I guess I better call the meeting to order. I am the oldest person in the room."

[Laughter.]

MR. SMITH: And Frank Moore, the congressional liaison, turned to Jordan and says, "What do we do next? Do we have a staff meeting every day?" Jordan said, "Well, we will have them when we need one."

Now, if at the end of a transition period, you have a staff situation that is that screwed up, that no wonder the President had a lot of trouble getting started, but we didn't know necessarily going back to Ruth's point--we didn't know--we knew that there was feuding within the Carter--prospective Carter White House team.

MR. : Did you report it?

MR. SMITH: We did not understand necessarily the significance, how big a problem this was going to be, and if you look at Carter's difficulties through his term, going back to that point, and Gray's comment about how an agency can get in trouble if you don't get the clearances and the people in place, the Carter White House took a very long time to get itself sorted out, couldn't figure out how to return phone calls.

Tip O'Neill called Hamilton Jordan, "Hannibal Jerkin" because he never called, and went up on Capitol Hill. He violated all of the political rules you played out.

I think a dialogue between knowledgeable people from former administration and scholars like yourselves and the media not only now, but benchmarking a couple of times, you know, as administration goes along, it is very hard to do this without politically carping, but at least informing people where other administrations had been at this point. It is useful.

The only score-carding we do now is how many appointments have been made. By the end of the transition period, The New York Times, The Washington Post, The Wall Street Journal, everybody will have a scorecard. At this point, Reagan had 43 appointments. You know, Nixon had so many, and this new President has so many and they are behind or they are ahead or whatever.

MR. : One of the most important lessons from Dick's memos and my understanding of what Dick's experience suggests is that much depends not on dialogue, but on the President-Elect, who that person is and what that person is--what his thoughts are in regard to the transition.

But Rick's comments raise a question that I would like to hear Ruth and others talk about, and that is what are the expectations of the press in regard to this period, what is it that you think ought to happen during this time.

MS. MARCUS: Well, to use the phrase that I think Dick used before, we do need to be fed because, if we are not fed with stories, if news is not happening, if we are going to write something, we are all sitting in Little Rock or in Austin or even at home in Bethesda with copy that we need to write and we are going to write a story. If the story is not managed to the extent that any transition team can manage it, it will get out of their control.

I wanted to--so I think we have an expectation to some extent of the new team coming in and showing that they have this thing somewhat under control, showing that they have a vision of what they want to do with the Government, showing that they have a plan, showing that they can move the appointments process along in the way that Boyden said. It needs to be moved along in order for the Government to start functioning smoothly, demonstrating something that I think is the hardest thing for a new administration to demonstration which is an absence of hubris. It is a little hard not to be arrogant if you just won a Presidential election, but you need to realize that there is a structure in place and a Government in place and, to some extent, a permanent press corps in place, and when you start changing expectations and changing the rules of the game, even in the very most minor possible way--and I am thinking of the closing-off of the upper press office--

MR. : That wasn't minor.

[Laughter.]

MS. MARCUS: But, I mean, it sounds minor to any normal human being--

MR. : That's right.

MS. MARCUS: --outside the Beltway.

MR. : Right.

MS. MARCUS: But I remember on our way from Little Rock to Washington, having dinner with George Stephanopoulos a couple nights before the Inauguration saying--and I hadn't covered the White House before, but I had been there and say you need to understand what is going to happen if you do that. I mean, I wasn't telling him this entirely out of the goodness of my heart. I had a vested interest. So, quite honestly, the vested interest of The Washington Post and being able to get through that door is not as large as the interest of others who are going to have a harder time getting their phone calls returned if the door is closed.

And he just looked at me with this completely blank face like I don't want to hear it, forget it, and we went onto another topic. That is parable for how new administrations ought to listen not to people like me, but to people who have had--[audio break].

[Side A of Tape 2 of 2 begins.]

MR. : They have been thrust on the campaign. They are running around under terrific deadline pressure, hearing the same speech over and over again, and if anything, they have been focussing on what divides Americans and what separates them and the process of governing is how you bridge across this divided system of Government of ours and build coalitions and set agendas and priorities, which is not what the campaign has been about.

So, when you say it is the press corps, what do they expect, I think coming out of a campaign, they expect their own thing.

The first thing we are looking for, of course, is who is up and who is down, who in the campaign got rewarded with good jobs. The first set of questions are all who questions, who won, not just who won the election, but who won within the entourage, and those are important because those are about the organization of the administration and they are also about the priorities of the administration.

MR. : Well, who may be associated with what, and what is the Presidency going to be?

MR. : So they have potential substantive and symbolic importance, but then they tend to degenerate and a lot of petty fighting.

There is a great tendency, particularly to look at the two outsiders that I watched come to Washington, Jimmy Carter and Ronald Reagan--there is a good deal of attention among the beset reporters in how they approach and take charge of the city.

Reagan's charm treatment, if you recall, down to Kay Graham's party forum, hooking up with Howard Baker as his [inaudible], Baking having decided to play it the same way Everett Dirksen played it, you know, many, many years before that, is to become the President's lieutenant instead of the Senate's man vis-a-vis the President and confronting the President from the congressional institution, those are all very important things that bode well for Reagan's ability when he took office to begin to get the legislation passed.

Jimmy Carter came. I will never forget the story he told on himself weeks later to a group of Southeastern legislators on a trip. He said, "When I came to Washington, I asked people how I should treat Congress." He said, "Somebody told me I should treat them like the Georgia legislature. I tried, and it didn't work," and you saw that as Carter was trying to relate to Capitol Hill. He stumbled. I mean, he made the announcement he was going to have a tax cut before he ever got in office. Obviously, the press is fascinated with any declaration of policy. It was a stupid thing for him to do. He had to renege on it when he got into office.

Clinton got in his fight with regard to gays in the military. Carter got in his fight with pork barrel. He went and attacked pork barrel legislation, which is obviously one of the favorites of Congress, before he ever got to his agenda.

I think some of those things, we are looking for in the media. We are looking for indicators of how well the President is organizing, whether he is beginning to get his priorities together. We never could figure Carter's out, and every time you asked, he had a list of 10 and he started on the second 10. You would say, "Which of those 12 things is most important?," and he would start through the list again. So I think there are indicators like that, that we look for, we spot, and we relay them to people, I think we are passing on important information.

I think, by and large, it is very hard for us as an institution to shift from that campaign mentality into the governing mentality into what is going to work.

MR. : Frank Moore even had more of a problem with Congress.

MR. : Chuck, if there are transition people in the room, I think you can take as axiom number one, you are going to have to deal with press narcissism. They are really interested in the first place in themselves and in their access, and Dick's memos in part go into that, but, fortunately, they go beyond that and talk a little bit about something that the press narcissism frequently obscures, and that is that there is a very large permanent Government which actually does some of the governing in the United States.

So, when, for example, Ronald Reagan early on appointed a tough guy as his budget director and neglected to appoint Assistant Secretaries in those agencies that he wanted to cut, that could have been the clue about how his administration was going to proceed.

Of course, there are other such examples. Brad Patterson brought up one or two, and Dick's response, I think, was completely appropriate.

When Richard Nixon appointed Henry Kissinger and William Rogers to the positions that he appointed, he was telling us something if we were ready to listen about how the conduct of foreign affairs was going to proceed.

So, in my view, attention to these memos actually gives a clue to some dimensions of an incoming administration which I am afraid are frequently obscured by the dull roar of journalists jockeying for their own positions.

MR. : I want to ask one other question, then go to--for general discussion, and then go to questions in the audience, and that is, beginning with Dick, if you would say something about this, as you understand it, the strengths and weaknesses of each of the Presidential candidates, the two party candidates, that is, Gore and Bush, for a successful transition.

MR. NEUSTADT: You want me to start. Well, Al Gore--

MR. : Lean forward, Dick.

MR. NEUSTADT: I'm sorry.

MR. : You are in Washington. You are not supposed to sink.

[Laughter.]

MR. NEUSTADT: Al Gore's strength or among his strengths is he knows a great deal about a great many things. That can also be a weakness if knowing all he knows and having made all the commitments he had made in the campaign, he doesn't stand back and sort it out.

Four years is a long time to try to get a lot of things done, and a lot of events will transpire, not all of which he can ride. If he had less substantive understanding and had made fewer commitments, he would have an easier job in the transition.

Then there is the problem of knowing the White House so well after 8 years that he thinks he knows what it is like to be President, and mostly, I dare say--I have never talked to him about this--most of those impressions come out of things he would have done differently and better, but Clinton didn't take his advice, right?

What he doesn't know is how it feels like when the responsibility is yours, and that changes everything, I think. So thinking he knows, but the fact being he doesn't altogether know, that is both a strength and a weakness.

The third thing, I suppose, for about Al Gore is that he is an inveterate student, not that he is indecisive. I don't think that is the problem, but he really wants to master any subject he is interested in, and initially, to be liberated from the Vice Presidency is going to seem to him to give him an enormous opportunity to do a lot of things he is interested in, but it won't, not in the circumstances of this election.

Bush's problems are, I think, more conventional because he hasn't been sitting there for 8 years. He does want to vindicate his father. That is pretty clear. That means he has paid some attention to the office his father's held and his opportunities and limitations, but if he thinks that being Governor of Texas is anything like being President, he has got a lot to learn. We saw in Governors Clinton and Carter how much Southern Governors have to learn, and it is just a staggering amount.

Also, unlike Ronald Reagan, he does not appear to have four or five convictions that he holds to regardless of the evidence, and that he can consult about key matters of policy. If he doesn't have such convictions, he is going to have to go to--he is going to have to trust the people around him on policy for everything, and if he relies on the people around him, you know, he is going to be in a lot of trouble.

Finally, I think he has got the great advantage, certainly great as compared to Gore, of under-expectation. Now, the man is clearly not stupid. He is politically quite bright. He doesn't have to work hard in the Presidency. Reagan proved that. He merely has to pick people well and have some Lone Stars, which we don't know if he has or not, some convictions.

But the fact that this one subterranean issue in this election is he is not up to being President gives him a great advantage. He doesn't have to be Superman. He just has to be--

MR. : He has to show up.

MR. : He has to show up and do his work every day, and I think that is an unmitigating strength for him.

I will shut up there.

MR. : I have got two thoughts. If you are interested in how these people would administer a Government or run a Government, that is sort of the invisible part.

Foreign affairs is visible. How they deal with Congress is visible. How they run the Government is almost completely invisible, that piece.

For Gore, the template I would guess would be the Reinventing Government project that he was handed, and I would look there. I mean, if I were Ruth, I would put somebody on doing a rather sizeable project of finding out how Gore ran the Reinventing Government operation.

For Bush, I would say the Harvard Business School. I think that has been his main exposure to management outside of whatever he could glean by watching his father.

MR. : I wonder if I could throw in a question here, Dick. I was fascinated by your memos and reading them in detail, and I was equally fascinated by your essay at the end of the book. And what really struck me was the difference in character between the two sets of documents, not the mea culpa part.

But your memos were, by and large, focussed on the mechanics and organization and the putting together of an administration, but your biggest--what I would call organizational advice--but your biggest points in your essay and, indeed, in Charles Jones' introduction was what I would call political advice, hubris, arrogance, and innocence. Don't overestimate the power of the Presidency. Find out who in Government can help you now. Build alliances. Don't mistake any experience you have had in your homestate for being comparable to Washington, and now you have added the correlate, don't mistake the Vice Presidency as a proxy for the Presidency.

And I am wondering whether or not anybody of your stature or any other stature can actually say these things point blank on paper to an incoming President because it seems to me that in many instances, those pieces of advice are more important than some of the specific mechanical suggestions that people are open to because they are asking you how do I put the machinery together, and what you are saying is--let me paraphrase James Baker.

I asked Jim Baker once what is the most important quality for a White House chief of staff. Without hesitation, and I hope everyone present will forgive me, Jim Baker said, "The most important quality, the most important tool and necessity of a good chief of staff is a good shit detector. The job of the chief of staff is to keep the President out of trouble." Political advice of the most fundamental sort is designed to keep a President out of trouble, and my question is, is a newly elected President-Elect prepared to take, listen to, seek out, and want political advice that would actually keep him out of serious trouble?

MR. NEUSTADT: Are you looking to me to answer that?

MR. : Speak up a little, Dick.

MR. NEUSTADT: Well, I don't know the answer to that.

MR. : Could you give that advice? Did you give that advice?

MR. NEUSTADT: I wasn't asked for that advice. I gave what I was asked for, right?

But you have got to remember that 40 years of experience and advice-giving goes from the front of that book to the back. So you learn a few things as you go.

I don't think that as a youngster on the Truman staff, I was probably very well equipped to tell Jack Kennedy how to keep out of trouble, and I don't think he would have come to me to be told how to keep out of trouble. So maybe I have learned a thing or two, but I have also reached that advanced age where Presidents-Elect are most unlikely to seriously come to old geezers to be told how to keep out of trouble.

My father told me at the time Franklin Roosevelt was elected, "Don't expect to see in Washington many people older than President-Elect," and that is where I think people will look. People will look to their contemporaries for most of their advice.

MR. : Let's go to questions. Yes, in the back.

MR. : Al Millikan [ph] affiliated with the Washington Independent Writers.

In fact, relating to this last question, in the last few years, in particular, I read recently where how many religious and spiritual advisors [inaudible] out of the Clinton White House and various administrations in the last half century turn to Billy Graham in particular, publicly and privately.

I am wondering during the transition period, is anyone aware of any religious or spiritual advisors playing any significant role that you are aware of?

MR. : I don't have any awareness that would help me out on that one. I pass.

MR. : Well, now, Joe Lieberman has said that God himself speaks directly to him and vice versa.

[Laughter.]

MR. : Other questions?

MR. PHILLIPS: My name is Jeff Phillips. I work for the BBS World Service.

A question for Richard Neustadt. If you were the incoming President and you were choosing Cabinet officers, what kind of principles would guide you in the choice? Are you looking for people who are politically dependent upon you, people who are politically powerful, who can take hold of an air of administration and leave you, so to speak, free to get on with other things? Are you looking for people you can trust? Are you looking for people who can handle policy on the Hill? Are you looking for people who aren't likely to give you problems? I mean, what is the overriding principle in looking here?

I mean, I realize there are no black and white answers on this, but where--what are the principal considerations?

MR. NEUSTADT: Well, I don't think you have as much freedom as you are suggesting.

In the first place, there are only about four Cabinet offices that really matter. The other offices that matter are inside the White House as far as an executive establishment is concerned.

State, Defense, Treasury, and Justice, for most administrations, really matter. For the rest, you just hope you are not embarrassed by these people.

Mr. Clinton made a valiant try, not just to get an administration that looks as diverse as the country, but to get people who would be compatible with himself and each other. The trouble is he spent too much damn time on that. He didn't have that much time. He should have spent the time first in assembling the staff immediately around him, and he didn't.

Since you don't have much time, you have to take chances on people. You never know how people are going to turn out once they get to the Potomac. They get Potomac Fever and God knows what will happen to them. You might as well understand that.

What you want in principle is people who will be intelligent in dealing with their Departments and going up on the Hill and testifying which is what Cabinet officers spend half their time doing. You want people who will be loyal to you. You want people who can help you with the public relations of your administration.

You would like people to have brilliant ideas, but you know you can always look through the whole country for ideas. You don't really have to depend on your Cabinet for ideas. That is not your first priority, but you have little time and you do not have infinite places. You have got to take members of your own party. You have got to pick deserving people. You have got to pick people who will give a representative cast to the country, as Clinton tried to do. You proceed by taking plunges.

The constraints are much greater than your question suggests, and a lot of them come out of the campaign period. A lot of them cannot be anticipated until after you are elected. Mr. Kennedy didn't know he was going to be so narrowly elected that gold would start flying out of the country. That immediately constrains his choice of a Secretary of Treasury. He needed a Republican who Wall Street would look on with favor. So how many choices do you have? So he found a family friend who was Ike's Under Secretary of State. He was lucky.

For Secretary of State, he wanted Senator Fulbright, but he couldn't--he felt that Fulbright's stand on civil rights made it just too difficult politically. So he went to key figures in the bipartisan establishment and said, "Who would you suggest I appoint?," and they all said our second choice is Dean Rusk. So he appointed Dean Rusk.

I don't think you can make it much more scientific than that.

MR. : We have one more question.

MR. : I want to ask a question about press coverage. I am Wes [inaudible], University of Missouri.

I want to go back to the story that Rick told--

MR. : [Inaudible.]

MR. : Oh, Wes Pippert [ph], Missouri Journalism.

A question or a comment about the press coverage. I covered the White House during all of Carter and part of Ford, and the story that Rick told about the staff meeting on the first day, Nelson shot in a question, but did you report it. And I have a hunch that you probably did not report it that day.

I remember a comment that Jody Powell once made when he said that on most days, he could control or shape 80 percent of all the copy that came out of the White House. I imagine on most days, even the best of the White House reporters know only a tip of what decisions are being made or how those decisions are being made which is perhaps even more important.

So I think in answer to Nelson's comment that there is narcissism or too much hubris on the part of the press, the odds are always stacked there on the side of the office-holders and the establishment and not the press who are essentially Lone Rangers trying to get to the story.

MR. : I guess I take that as a prompting just to answer Nelson's question.

MR. : Thank you.

MR. : The answer is that we did report that there was feuding between Jordan and Watson before the Carter people took the White House, but the information that I reported on how the staff meeting went, I didn't find that out for a couple of years, years after the fact that people were willing to level.

In fact, somebody else in the room said, "My God, if the KGB understood how bad off we are here, think what they would do to us." That was not stuff that leaked out.

MR. : Yeah, but he wasn't aware of how the KGB was badly organized.

MR. : That's right.

[Laughter.]

MR. : In any case, it wasn't information to be sat on. To make Wes' point, it was information that we didn't have, and that stuff comes very, very hard.

MR. ORNSTEIN: Thank you all very much, and I urge those of you in the audience to read this book.

I might note that the Transition to Governing Project is not going to come up with some thick tome of policy proposals. We are interested in the process, trying to make it work, and also the journalistic process, and we hope this book, in part, will serve as a template for reporters on the kinds of things to look at and the things to report which include not just the personalities, but how the White House itself is being structured, not just the scorecard, but what this tells us about what kind of Government we are going to have, and also maybe a critical focus on some of these processes including a nomination and confirmation process that has in many ways careened out of control and could use some reporting as well, and we hope that people in both transition teams--not just the transition teams, but the people who will actually have some role to play will read this book and get some lessons from it early rather than when it is too late, which is usually the case.

I would simply remind you all that we have another event here Friday morning from 9:00 to 12:00 on the other book which has just come out. It was just about to come out, "The Permanent Campaign and Its Future."

Thank you all very much. We are adjourned.

[Applause.]

[End of conference.]