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Copyright 2004 Burrelle's Information Services
SHOW: 60 Minutes (7:00 PM ET) - CBS
January 11, 2004 Sunday
TYPE: Profile

LENGTH: 2535 words

HEADLINE: Inside the Bush White House; Former Treasury Secretary Paul O'Neill discusses his experiences in the Bush administration

ANCHORS: LESLEY STAHL

BODY:
INSIDE THE BUSH WHITE HOUSE

LESLEY STAHL, co-host:

A year ago Paul O'Neill was fired from his job as George Bush's Treasury secretary for disagreeing too many times with the president's policy on tax cuts. Tonight, O'Neill, who is known for speaking his mind, talks for the first time about his two years inside the Bush administration. His story is the centerpiece of a new book being published this week about the way the Bush White House is run. Entitled "The Price of Loyalty," the book by a former Wall Street Journal reporter draws on interviews with high-level officials who gave the author their personal accounts of meetings with the president, their notes and documents. But the main source of the books was Paul O'Neill.

(Footage of Paul O'Neill and reporter walking)

STAHL: (Voiceover) Paul O'Neill says he's going public because he thinks the Bush administration has been too secretive about how decisions have been made.

Mr. PAUL O'NEILL: Contrary to how we practice politics today in this country, there is some market for the truth.

STAHL: Somebody's going to call it a kiss-and-tell book.

Mr. O'NEILL: I've come to believe that people will say damn near anything, so I'm sure somebody will say all of that and more.

(Footage of O'Neill at Cabinet meeting; George W. Bush, Colin Powell and Donald Rumsfeld at meeting; Bush; photo of O'Neill and text excerpt; Bush and O'Neill walking)

STAHL: (Voiceover) O'Neill, who was George Bush's top economic policy official, says in the book that the president did not make decisions in a methodical way. There was no free flow of ideas or open debate. At Cabinet meetings he says the president was like a 'blind man in a room full of deaf people. There is no discernable connection,' forcing top officials to act on 'little more than hunches about what the president might think.' This is what O'Neill says happened at his first hour-long, one-on-one meeting with Mr. Bush.

Mr. O'NEILL: I went in with a long list of things to talk about and, I thought, to engage on. And as the book says, I was surprised that it turned out me talking and the president just listening.

STAHL: He never asked a single question?

Mr. O'NEILL: As I recall it was--it was mostly a monologue.

(Footage of O'Neill and reporter)

STAHL: (Voiceover) President Bush was disengaged, at least on domestic issues, he says, and that disturbed him.

Mr. O'NEILL: This is a photograph of President Nixon. That's me there.

(Footage of O'Neill and reporter; photograph; O'Neill and reporter; O'Neill and Ron Suskind walking)

STAHL: (Voiceover) He told us that wasn't his experience when he worked as a top official under Presidents Nixon and Ford, or the way he ran things when he was chairman of Alcoa. O'Neill readily agreed to tell his story to the book's author, Ron Suskind. O'Neill says he's taking no money for his part in the book.

You interviewed how many other people?

Mr. RON SUSKIND: Oh, hundreds of people.

STAHL: Hundreds?

Mr. SUSKIND: Hundreds of people.

STAHL: How many other Cabinet members?

Mr. SUSKIND: Several. Let's just say several.

(Footage of Suskind and reporter talking)

STAHL: (Voiceover) But O'Neill is the only one who spoke on the record.

Didn't someone in this administration high up...

Mr. SUSKIND: Yes.

STAHL: ...call him on the phone and warn him not to do this book?

Mr. SUSKIND: Yes. Yes.

STAHL: And who was it?

Mr. SUSKIND: Don Rumsfeld.

STAHL: Was it a--a warning or a threat?

Mr. SUSKIND: I don't think so. I think it was the White House concerned...

STAHL: Mm-hmm.

Mr. SUSKIND: ...understandably, because O'Neill has spent extraordinary amounts of time with the president. They said this could really be the one moment where things are revealed.

(Footage of Suskind looking at documents)

STAHL: (Voiceover) And they are. Not only did O'Neill give Suskind his time, he gave him 19,000 internal documents.

Mr. SUSKIND: I mean, everything's there. Memoranda to the president, hand-written thank-you notes, 100-page documents, stuff that's sensitive, stuff that...

STAHL: Stuff that's sensitive?

Mr. SUSKIND: Right. Yeah.

STAHL: Transcripts of private meetings?

Mr. SUSKIND: Yeah, in some cases.

STAHL: High-level?

Mr. SUSKIND: Yep, National Security Council. You don't get higher than that.

(Footage of Suskind; book cover; Suskind leafing through book)

STAHL: (Voiceover) And what happened at President Bush's very first National Security Council meeting is one of O'Neill's most startling revelations.

Mr. O'NEILL: From the very beginning there was a conviction that Saddam Hussein was a bad person and that he needed to go.

(Footage of Saddam Hussein and men; Bush at inauguration)

STAHL: (Voiceover) He says that going after Saddam Hussein was topic A 10 days after the inauguration, eight months before September 11th.

Mr. SUSKIND: From the very first instance it was about Iraq, it was about what we can do to change this regime.

STAHL: Now, everybody else thought that grew out of 9/11...

Mr. SUSKIND: No.

STAHL: ...but this book says it was day one of this administration.

Mr. SUSKIND: Day one these things were laid and sealed.

(Footage of O'Neill walking; photo of O'Neill and text excerpt)

STAHL: (Voiceover) As Treasury secretary, O'Neill was a permanent member of the National Security Council. He says in the book he was surprised at the meeting that questions such as why Saddam and why now were never asked. 'It's all about finding a way to do it.' That was the tone of it, the president saying 'Go find me a way to do this.'

Mr. O'NEILL: For me, the notion of--of preemption, that the US has the unilateral right to do whatever we decide to do, is a--is a really huge leap. And...

STAHL: And that came up on--at this first meeting?

Mr. O'NEILL: It did.

(Footage of the White House; document)

STAHL: (Voiceover) O'Neill told us the discussion of Iraq continued at the next National Security Council meeting two days later. He got briefing materials under this cover sheet.

Mr. SUSKIND: There are memos. One of them, marked "secret," says "Plan for Post-Saddam Iraq.'

STAHL: Nation-building.

Mr. SUSKIND: Absolutely.

STAHL: So they discussed an occupation of Iraq.

Mr. SUSKIND: In--in January and February of 2001.

STAHL: Based on his interviews with O'Neill and several other officials at the meetings, Suskind writes that the planning envisioned peace-keeping troops, war crimes tribunals, and even divvying up Iraq's oil wells.

(Footage of document; map)

STAHL: (Voiceover) Suskind obtained this Pentagon document dated March 5, 2001, entitled "Foreign Suitors for Iraqi Oil Field Contracts." It includes a map of potential areas for exploration.

Mr. SUSKIND: It talks about contractors around the world from, you know, 30, 40 countries, and which ones have what intentions or...

STAHL: On oil.

Mr. SUSKIND: On oil in Iraq.

(Crowd cheering; footage of Bush signing autographs; Bush and Al Gore at debate)

STAHL: (Voiceover) During the campaign, candidate Bush had criticized the Clinton/Gore administration for being too interventionist.

President GEORGE W. BUSH: (From campaign debate) We--if we don't stop extending our troops all around the world in nation-building missions then we're going to have a serious problem coming down the road, and I--I'm going to prevent that.

STAHL: The president had just run a campaign about being humble and not engaging in that--in nation-building.

Mr. SUSKIND: The thing that's most surprising, I think, is how emphatically from the very first this administration had said "X" during the campaign, but from the first day was often doing "Y"; not just saying "Y" but actively moving toward the opposite of what they had said during the election.

(Footage of Bush singing tax cut bill)

STAHL: (Voiceover) But the president had promised to cut taxes, and he did. Within six months of taking office, he pushed a trillion dollars worth of tax cuts through Congress.

Pres. BUSH: (From speech) This is significant, and this is only the beginning.

STAHL: But O'Neill thought it should have been the end. After 9/11 and the war in Afghanistan the budget deficit was growing. So at a meeting with the vice president after the mid-term elections in 2002, Suskind writes that O'Neill argued against a second round of tax cuts.

Mr. SUSKIND: Cheney at this moment shows his hand. He says, 'You know, Paul, Reagan proved that deficits don't matter. We won the mid-term elections, this is our due.'

STAHL: 'We earned it.'

Mr. SUSKIND: Exactly.

STAHL: What did O'Neill think?

Mr. SUSKIND: O'Neill is--is speechless.

Mr. O'NEILL: It--it was not just about not wanting the tax cut, it was about how to use the nation's resources to improve the condition of our society. And I thought the weight of working on Social Security and fundamental tax reform was a lot more important than a tax reduction that was branded in...

STAHL: Did you think it was irresponsible?

Mr. O'NEILL: Well, the--it's for sure not what I--I would have done.

(Footage of Bush and Dick Cheney; photo of O'Neill and text excerpt; O'Neill; currency printing press; ticker board; office building; O'Neill and man walking; children; O'Neill and Bono)

STAHL: (Voiceover) O'Neill accuses Vice President Dick Cheney of not being an honest broker, but, with a handful of others, part of 'a praetorian guard that encircled the president' to block out contrary views. O'Neill says, 'This is the way Dick likes it.'

Meanwhile, the White House was losing patience with O'Neill. He was becoming known for a series of off-the-cuff remarks his critics called 'gaffes.' One of them sent the dollar into a nose-dive and required major damage control. Twice during market meltdowns O'Neill was not available to the president, he was out of the country, one time on a trip to Africa with the Irish rock star Bono.

BONO: (Singing and clapping) I can run, I can crawl.

(Footage of Africa trip)

Mr. SUSKIND: (Voiceover) Africa made an enormous splash. It was like a road show.

He comes back and the president says to him at a meeting, he says, 'You know, you're getting quite a cult following.' And it clearly was not a joke, and it was not said in jest.

STAHL: It was a putdown.

Mr. SUSKIND: It was.

(Footage of O'Neill at forum; Bush and woman)

STAHL: (Voiceover) Suskind writes that the relationship grew more tense, and that the president took a jab at O'Neill in public at an economic forum in Texas.

Unidentified Woman: (At forum) And I'm just honored to be sitting beside one of my heroes.

Pres. BUSH: (At forum) Who, O'Neill? We found one, O'Neill.

Mr. O'NEILL: (At forum) Yes, and I'll take it.

(Footage of O'Neill and Bush at forum; O'Neill; Bush; O'Neill and Bush; O'Neill)

Mr. SUSKIND: (Voiceover) The two men were never close. O'Neill was not amused when Mr. Bush began calling him "The Big O." He thought the president's habit of giving people nicknames was a form of bullying. Everything came to a head for O'Neill at a November 2002 meeting at the White House of the economic team.

Well, it's a huge meeting. You've got Dick Cheney from the, you know, secure location on the video...

STAHL: Oh.

Mr. SUSKIND: ...the president is there.

(Footage of Suskind reading; Bush)

STAHL: (Voiceover) Suskind, who was given a nearly verbatim transcript by someone who attended the meeting, says everyone expected Mr. Bush to rubber-stamp the plan under discussion, a big new tax cut. But according to Suskind, the president was, perhaps, having second thoughts about cutting taxes again and was uncharacteristically engaged.

Mr. SUSKIND: He asks, 'Haven't we already given money to rich people? This second tax cut's going to do it again.'

STAHL: The president himself says, 'But we already gave it to the rich people?'

Mr. SUSKIND: Yes, he says...

STAHL: 'Why are we going to do it again?'

Mr. SUSKIND: ...'Did we already--why are we doing it again? Why are we doing it again?' Now, his advisors, they say, 'Well, Mr. President, the upper class, they're the entrepreneurs.' That's the standard response. And the president kind of goes, OK, that's their response. And then he comes back to it again. 'Well, shouldn't we be giving money to the middle? Won't people be able to say, 'You did it once, and then you did it twice and what was it good for?'

(Footage of Suskind; photo of Bush and Karl Rove)

STAHL: (Voiceover) But according to the transcript, White House political advisor Karl Rove jumped in.

Mr. SUSKIND: Karl Rove is saying to the president a kind of mantra, 'Stick to principle. Stick to principle.' And he says it over and over again.

STAHL: And he's saying, 'Stick and don't waver.'

Mr. SUSKIND: 'Don't waver.'

(Footage of Suskind and reporter talking; O'Neill)

STAHL: (Voiceover) In the end, the president didn't. And nine days after that meeting in which O'Neill made it clear he could not publicly support another tax cut, the vice president called and asked him to resign. With the deficit now climbing towards $400 billion, O'Neill maintains he was in the right.

(To O'Neill) But look at the economy today.

Mr. O'NEILL: Yes.

STAHL: Can't the White House say, 'Look, we were right and O'Neill was wrong'?

Mr. O'NEILL: Well, in the last quarter the growth rate was 8.2 percent.

STAHL: Wow.

Mr. O'NEILL: It was terrific.

STAHL: Is it because of the tax cut?

Mr. O'NEILL: I think the tax cut made a difference, but without the tax we would have had 6 percent real growth and the prospect of dealing with transformation of Social Security and fundamentally fixing the tax system. And to me, those were compelling competitors for--against more tax cuts.

(Footage of Bush and O'Neill walking)

STAHL: (Voiceover) While in the book O'Neill comes off as constantly appalled at Mr. Bush, he was surprised when I told him I found his portrait of the president unflattering.

Mr. O'NEILL: Oh, you really think so? I got--you know, I...

STAHL: Are you--are you joking?

Mr. O'NEILL: No, no. I--you know, I...

STAHL: Are you teasing me?

Mr. O'NEILL: No, no, no, I'm not at all.

STAHL: Because it's--it really jumps out.

Mr. O'NEILL: I'll be darned.

STAHL: You're giving me the impression that you're just going to be stunned if they attack you for this book.

Mr. O'NEILL: Really...

STAHL: And they're going to say, I predict, you know, 'It's sour grapes. He's getting back because he was fired.' I--and you don't...

Mr. O'NEILL: Well, I think I will--I will really disappointed if they react that way, because I think they'll be hard-put to point...

STAHL: But are you prepared for it?

Mr. O'NEILL: Well, I don't think I need to be, because I--I can't imagine that I'm going to be attacked for telling the truth. Why would I be attacked for telling the truth?

STAHL: White House Spokesman Scott McClellan was asked about the book on Friday and said, 'The president is someone that leads and acts decisively on our biggest priorities, and that is exactly what he'll continue to do.'

(Footage of 60 MINUTES clock)

(Announcements)

LOAD-DATE: January 12, 2004