Fox News "Fox News Sunday" - Transcript
Interview
Fox News "Fox News Sunday" - Transcript
FOX "FOX NEWS SUNDAY"
HOST: CHRIS WALLACE
GUESTS: SENATOR JOHN MCCAIN (R-AZ); GOVERNOR TIM KAINE (D-VA), CHAIRMAN, DEMOCRATIC NATIONAL COMMITTEE
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MR. WALLACE: I'm Chris Wallace, and this is "FOX News Sunday."
(Intro music plays.)
Republicans rally against a huge spending bill and leading the charge, Senator John McCain. We'll talk with the former presidential candidate about runaway earmarks, how the White House is handling the economy, and foreign hot spots. John McCain, only on "FOX News Sunday."
Then, is President Obama trying to do too much too soon? We'll ask one of his closest allies, the head of the Democratic Party, Governor Tim Kaine.
Plus, Mr. Obama suggests Americans should get in the market.
PRESIDENT BARACK OBAMA: (From videotape.) Buying stocks is a potentially good deal, if you've got a long-term perspective on it.
MR. WALLACE: We'll ask our Sunday Regulars if the president is doing all he can to boost sagging stock prices.
And why did our Power Player of the Week get carded as a member of Congress?
All right now, on "FOX News Sunday."
(Intro music ends.)
And hello again from FOX News in Washington.
People who lose presidential elections deal with it in different ways. Some retire; others lick their wounds. But our first guest has gone right back into the legislative arena.
And we're happy to welcome Senator John McCain back to "FOX News Sunday."
As always, Senator, good to have you with us.
SEN. MCCAIN: Thanks, Chris. It's nice to be back with you. It's interesting times.
MR. WALLACE: Let's start with the interesting times, and let's start with the $410 billion spending bill before the Senate to fund the government through September.
Here's what Barack Obama said to you about this subject in a presidential debate last September:
PRESIDENT OBAMA: (From videotape.) Absolutely, we need earmark reform. And when I'm president, I will go line by line to make sure that we are not spending money unwisely.
MR. WALLACE: Now the White House says that this is basically an argument over the last Bush budget and therefore it's last year's business.
Is there a practical case to be made that with all the things that President Obama wants to get through Congress, he shouldn't get into a fight over this?
SEN. MCCAIN: Well, first of all, he -- if -- if he wants to set a standard and wants to set a path, then absolutely he should be in this. He absolutely should be in it, because we're talking about $480 billion of taxpayers' money loaded down with $8 billion worth of earmarked, pork-barrel projects.
And we'll go into definitions of that, but the fact is they're unneeded, unwanted, unnecessary, and it is not last year's business. It's money that's going to be spent as soon as the president signs the bill.
And he shouldn't sign it; he should veto it and send it right back.
MR. WALLACE: All sides expect that this bill is eventually and -- sometime this week, going to get through Congress. Why hold it up over the weekend? Do you really think you can stop it?
And what do you think of Republican senators like Snowe and Specter, who may provide the last one vote to get it over the top?
SEN. MCCAIN: Well, I regret their decisions, but I think that we've been able to garner great support throughout the country in the last week, as we've been engaged in this debate.
I think more and more Americans are against it, and several Democrat senators, who were on the fence, are now against it.
By the way, I Twitter the top 10 pork barrel projects. We have gotten incredible response from it, now from local media people in the area where these earmarks take place. And it's really been a lot of fun.
MR. WALLACE: Do you think it's going to get passed this week?
SEN. MCCAIN: I think it probably will. I'd like to say otherwise, but what's going to happen is that some Democrats are going to vote against the bill, but they'll vote for cloture, which means that we move forward with the final passage.
But I think we've fought a good fight. And we have to -- if we don't stop this kind of spending, which is corrupting -- I mean, there's corruption.
We have people, former members of Congress, in federal prison. We have people under indictment right now, one just last week, who were involved in this. One just day before yesterday.
This is a corrupting influence. We are giving money for 13 projects to an outfit called PMA, which was raided and shut down by the FBI. Now, they're the ones that got the earmark for different organizations out of Defense spending.
Now we're going to fund what an outfit got put into this bill that are raided and shut down by the FBI, that everybody knows are going to be on trial.
MR. WALLACE: The stock market has dropped 20 percent since the Obama inauguration. Can this now fairly be called the Obama bear market?
SEN. MCCAIN: I think -- I'd leave -- I'd like to leave that up to the experts.
But I do believe that a $1.2 trillion stimulus package, add that to a $750 billion TARP, add that to this $480 billion supplemental, add it to another TARP that's coming down, massive deficits, and we are committing generational thrift -- theft.
We are laying a debt on future generations of Americans. And we had a proposal of spending $410 billion for a stimulus. Yet, after two quarters of economic growth, positive economic growth, we would have ordered a path to balanced budget.
What we're doing is phenomenal, not only as far as the debt is concerned, but the transfer of what the free enterprise system does over the government. It's -- it's the biggest since Franklin Delano Roosevelt.
MR. WALLACE: And do you think that is contributing to the decline in the market, the messages that the Obama administration is sending about its agenda?
SEN. MCCAIN: I think so, but I -- I'm always a little nervous about allowing short-term market activity to drive our conclusions.
But I don't think there's any doubt, talking to friends of mine on Wall Street and people that I know, that this is not a positive signal. All of this spending, all of this debt, all of the policies that will now, in the long term, cause us to have a negative GT -- GB -- (chuckles).
MR. WALLACE: GDP.
SEN. MCCAIN: GDP growth, according to the Congressional Budget Office, over time.
MR. WALLACE: What do you think of --
SEN. MCCAIN: (Inaudible.)
MR. WALLACE: What do you think of Treasury Secretary Geithner, and how serious is it that seven weeks into this administration they still don't have a plan to deal with the banks and the whole lending crisis?
SEN. MCCAIN: I think they started off badly with a message that was not specific. I think that they are still not specific enough.
I don't think they've made the hard decision, and that is to let these banks fail, to let General Motors go into bankruptcy and reemerge and reorganize with new contracts with labor and others. I don't think they've made the tough decisions.
Some of these banks have to fail. AIG, back, I believe, when we started bailing it out, I said we've got to let it fail. You can't have zombie banks, like the Japanese had. And unfortunately, that seems to be the path.
Now the latest housing proposal, which is somewhat similar to the one I made during the campaign, I hope it will have a beneficial effect. And I will work as hard as I can to help that work.
MR. WALLACE: So when you say you'd let these banks -- would you nationalize them?
SEN. MCCAIN: Well, you'd sell off their assets and you have the -- unfortunately, the shareholders and others will take a beating. But to just keep them alive when -- and keep pouring billions and billions of taxpayers' dollars into them when they clearly are not -- their situation's not improving --
These are tough choices. I don't know if it's called nationalizing, but it certainly is not continue to propping them up with tens or 40 (billion dollars) or $50 billion of taxpayers' dollars, and their overall value continues to decline.
MR. WALLACE: So you think that this administration is making a mistake by seeming to continue to keep the banks on life support, to keep General Motors on life support? You would let --
SEN. MCCAIN: I think the best thing that could probably happen to General Motors, in my view, is they go into Chapter 11, they reorganize, they renegotiate their -- the union management contracts, and come out of it a stronger, better, leaner and more competitive automotive industry.
MR. WALLACE: Meanwhile, unemployment, up to 8.1 percent last month; 12.5 million Americans unemployed.
Some people are beginning to say the stimulus package, the $787 billion stimulus package that you just passed isn't enough, and you may need to come back for another big dose of government spending.
SEN. MCCAIN: Well, I hope it's not like this. I hope that we can give people tax cuts. I hope we can give small businesses incentives.
There was very little in the stimulus package for small businesses, the prime generator of jobs in America. I hope that we would not announce that we're going to increase taxes on anybody at this time. That always has a negative effect.
And I would do whatever I can to help with tax cuts, with shovel- ready projects, with a lot of toner things.
But what we have done is made some fundamental policy changes as regards welfare, as regards our protectionism, our relations with Mexico, in this latest bill, as far as Mexican trucking is concerned.
So we're not only spending huge amounts of money, and a lot of it not -- kind of spending that would have immediate results, but we are also having major policy changes that don't deserve to be on any money bill.
MR. WALLACE: There's been quite an argument this week about Rush Limbaugh's role in the Republican Party.
Over the years -- and we went back and looked -- he's gone after you a fair bit. At one point in 2002 he said a maverick is somebody who is in it for himself. And at the CPAC conference last weekend, here's what he had to say about why you show up so often on Sunday talk shows.
RUSH LIMBAUGH (Conservative radio talk show host.): (From videotape.) They invited Senator McCain because he happened to be the loudest at criticizing his own president and his own party, and that's what they want.
MR. WALLACE: Back in 2002 you compared Rush Limbaugh to a circus clown, and then you apologized to circus clowns.
SEN. MCCAIN: (Laughs.)
MR. WALLACE: Which I thought was a classic McCain line. (Laughs.)
SEN. MCCAIN: I thought it was a pretty good line, yeah.
MR. WALLACE: Yeah, not a bad line.
What do you make of Republican leaders, including the head of your party, Michael Steele, now apologizing to Rush Limbaugh?
SEN. MCCAIN: I think it's all a distraction. Very seriously. Mr. Limbaugh has his audience and his base of support. There's plenty around the country and around our party.
The important thing right now is what you have I've just been talking about -- job losses, health care unaffordability, the biggest economic crisis since the Great Depression.
Let's all work together with the president whenever we can -- against him if we think we have to, but let's be the loyal opposition. Let's work together and not get distracted by who's the leader of the party and who's not.
And the Democrats have made a lot of hay out of this, and I understand that. Now, let's move forward.
MR. WALLACE: Let's turn to foreign policy. And there is some breaking news.
Iran has announced this morning that they have launched a new long-range missile. Your reaction?
SEN. MCCAIN: It's not surprising, and it's not surprising that we continue to have information that they have the material to make nuclear weapons. Exactly where they are is not totally clear, but they're obviously on that trip.
This is a great threat to Israel, who they have threatened to, quote, "wipe off the face of the Earth." And this is going to be a -- I think, a serious international crisis before it's over.
MR. WALLACE: Really? The whole question of the Iranian --
SEN. MCCAIN: (Inaudible.)
MR. WALLACE: Let me ask you, the Obama administration -- and apparently this was raised in a private letter from Obama to Russian President Medvedev, this idea that if the Russians -- not a quid pro quo, but if the Russians get Iran to stop its nuclear program, then there's no need for an American missile defense system in Eastern Europe.
SEN. MCCAIN: Well, if I were the president, I would have tried to communicate that in other ways than a letter. We want to explore every possible option that we can to bring about the cessation of this crisis.
But time after time after time the Iranians have been belligerent and even very hostile in their reactions to our efforts to try to get that done.
The Russians, you would think it's in their interest to have the Iranians not pursue nuclear weapons. So far, they have not been helpful.
I worry about giving the Iranians a signal that we're not going to take serious action according to their violation of a number of treaties if they continue with this development of nuclear weapons and the means to deliver them.
MR. WALLACE: Along those lines, Secretary of State Clinton met with Foreign Minister Lavrov on Friday and talked about -- and we can see it here -- hitting the reset button on relations between the two countries.
Good idea?
SEN. MCCAIN: Turns out they were the wrong Russian words, but -- (laughs).
MR. WALLACE: Right. Overcharge, not reset.
SEN. MCCAIN: This is a new administration. They're obviously trying new approaches. Let's not forget the lessons that we learned from the last administration and the aggression in Georgia, a lot of their behavior in many respects has obviously been anti-American in many of its aspects. But most importantly, not a country that's dedicated toward a peaceful resolution of many of these issues.
MR. WALLACE: So you can't just reset the relationship?
SEN. MCCAIN: I think we can try all the time to have a better relationship with them, to appeal to what's in their national interest.
But it's also been very clear by their behavior and Putin's comments recently that it's going to be a very long and difficult process.
MR. WALLACE: We've been talking through all of this and, understandably, there are some areas I know that you have supported the president, some that you have not.
How do you think he's doing so far?
SEN. MCCAIN: I think he's working very hard. I think he is -- continues to have the support of the majority of the American people.
I think he is making a very serious mistake in this budget which would then transfer from the free enterprise system to the federal government many of the fundamentals of our economy, which I think is going to have very dangerous consequences.
And increasing taxes, no matter who it is, is wrong at this time. I do agree with him will work with him on defense procurement, on Iraq and a number -- any issue that I can work with the president, I will work with him.
MR. WALLACE: Do you ever feel like saying I told you so?
SEN. MCCAIN: (Laughs.) No. Oh, I'm sure that that would be a pleasant feeling, but the point is we're in such a severe crisis; we've got to work together. We must. We've got to put away childish things.
MR. WALLACE: Finally, on the area of childish things -- (laughter) -- your daughter Meghan wrote a blog -- (remark aside) -- this week in which she said that your presidential campaign has killed her social life. In fact, she writes one date said to her that she could be his Cindy.
What do you have to say for yourself, Senator?
SEN. MCCAIN: I have to say I have a beautiful daughter. I have very bright prospects for her future, both professionally and socially. (Laughs.)
MR. WALLACE: Do you plan a planned marriage?
SEN. MCCAIN: (Laughs.) No. Look, I'm proud of all of my children. And from time to time, they may do or say something that might be slightly not what I would do or say; that's what young people are all about.
MR. WALLACE: Well, I just want to say, as the father of three daughters, I know I speak for many fathers when I say congratulations on slowing down her social life, sir.
SEN. MCCAIN: (Laughs.) Thank you, Chris.
MR. WALLACE: Senator, thank you. Thanks for coming in today. And always -- you're always welcome. Please come back, sir.
SEN. MCCAIN: Thanks for having me.
MR. WALLACE: Up next, Governor Tim Kaine, the new chairman of the Democratic Party, in his first Sunday show interview.
Back in a moment.
(Announcements.)
MR. WALLACE: President Obama's standing in the polls is still strong, but his agenda is coming under increasing fire.
Joining us now from the state capitol in Richmond, the new chairman of the Democratic National Committee, Virginia Governor Tim Kaine.
And Governor, welcome back to "FOX News Sunday."
GOV. KAINE: Great to be back with you, Chris.
MR. WALLACE: Governor, let's put some numbers up on the screen. The Dow Jones closed before the inauguration at 8281. Now it's at 6626. That's a 20 percent drop, which is the definition of a bear market.
Governor, how much responsibility does the president bear for the tumble in the stock market since he's -- took office?
GOV. KAINE: Well, Chris, I think you have to look at where it was before it got to 8200. It had slid dramatically in the months before the inauguration, and that decline is continuing.
But the president and his team are working very hard to put steps in place so that we can start to grow the economy again.
Not going to happen overnight, but I think the right elements are being put in place so that we can start to stabilize and then grow the economy.
MR. WALLACE: Well, let's talk about the right elements, because the markets clearly have not been reassured by what messages the president has sent so far. And I think it's fair to say that they're looking particularly to the issue of a financial rescue plan.
GOV. KAINE: Right.
MR. WALLACE: Why is it that almost seven weeks after the president took the oath of office he still has not come forward with a plan to deal with the banks and their toxic assets?
GOV. KAINE: Well, Chris, there are a couple of elements of the plan that have been put out, sort of -- three elements, and then there's a fourth that's coming this week.
First, you had to create a capital cushion for some of these banks to make sure that they have adequate capital. Second, very important, the president's laid out a plan -- Senator McCain was speaking about it -- to try to mitigate the foreclosures; that's very important.
We have to get securitization going again, the ability of banks to have big chunks of assets securitized. That's been frozen up since October, and Secretary Geithner has laid out a plan on that.
And then the fourth element -- and this is very important, is one that he'll be talking about soon -- a plan that will use private investment to start to purchase bad assets, clear them off bank balance sheets, so that they can then go forward in a more healthy way.
This is complex stuff. And it's, unlike, say, the stimulus plan where we control it just on our own shores, this financial crisis is a worldwide financial crisis that we have to try to coordinate our actions, in some degree, with what's happening with financial regulation elsewhere. Prime Minister Brown came from England this week to talk about that.
So you just have to try to coordinate it with the effort to get this system going back on a worldwide basis.
MR. WALLACE: But I think you would agree, Governor, that the key part of that -- and the part that we've been talking about ever since September in the original financial rescue plan by the Bush administration -- was a way to get these banks not to be zombie banks, as Senator McCain said --
GOV. KAINE: Right.
MR. WALLACE: -- but to get these bad assets off the books to figure some way to deal with the billions and trillions of dollars of toxic assets.
I want to put some numbers up on the screen with the -- when it comes to appointments.
GOV. KAINE: Right.
MR. WALLACE: There are 800 jobs in the -- that the president has that need Senate confirmation. So far, this president has nominated 44, and of those, only 28 -- 28 of 800 -- have been confirmed.
Now, in the case of Treasury, Treasury Secretary Geithner is the only Obama nominee to win Senate confirmation. There's not a deputy secretary; there are no undersecretaries; there are no assistant secretaries.
Isn't that a serious failure, in the middle of a financial crisis?
GOV. KAINE: Well, it's certainly tough, but let's just look at past history as an indication. If you look at history of earlier administrations, when folks were confirmed, it often takes a little bit of time.
And there are a whole series of appointments that are not Senate- confirmable. There's about 50 political appointees that have been appointed, that are at work with Secretary Geithner in the Treasury.
But again, this is acknowledged, a very, very difficult situation. We're dealing with a financial problem on our own shores, and a decline in the stock market that started long ago. And we are trying to coordinate it with what's happening in the worldwide financial community.
There's going to be a G-20 summit, as you know, in April, where in November President Bush had one saying we've got to come back in an international way to set up the framework.
And what we're trying to do is get our pieces in order so that we can walk into that summit with a leadership position and help other nations do the same.
MR. WALLACE: Governor, you're exactly right; it is a very serious situation. But with the markets tumbling, with unemployment rising, the president is proposing this huge agenda with health care reform and carbon cap-and-trade, an increase in taxes on the wealthy.
Why not, shouldn't he, keep the focus almost exclusively, to the degree possible at this point, on what a lot of people think is job one -- the economic crisis and the financial situation?
GOV. KAINE: Chris, I think that the reason the president is doing this is these problems are connected to our economic crisis.
So just to use one example, Senator McCain talked, for example, about we need to focus on controlling health care costs. GM, we were -- we've been talking about GM. What is probably the most cited reason for GM's difficulties, or one of the most-cited, is the legacy costs on health care and retiree health care that GM has to carry that other automobile companies, particularly those in foreign companies, don't.
You hear people talk about federal spending going up dramatically in Medicaid and Medicare. These entitlement programs that are health care-related are part of our economic challenge.
So the president was elected to try to deal with this health care challenge, which is -- can be a choker on the economy. And the ability to bring legislators together of both parties, in the summit and discussions they had this week, I think we kind of refreshingly bipartisan and included representatives from a lot of stakeholders.
If we can start to get that right, that can be part of growing out of these economic doldrums. And you can say the same thing about looking at our energy future going forward.
There's not, kind of, the economy on one track and then getting energy right on a different track. They really are related.
MR. WALLACE: Governor, part of the Obama budget that he has put forward is to reduce the tax deductions in the top tax brackets. And even some Democrats are saying this is not the right time to create new disincentives for people trying to buy homes or to donate to charities.
Is that reduction in the -- the reduction in the deduction for top income owners, are you really going to stand on that one?
GOV. KAINE: Well, Chris, the president has laid out a basic budget, and the goal is -- it's trying to accomplish something very challenging right now, which is -- and he's very serious about it -- we want to get on a path to reduce the deficit, and reduce in half by the end of the administration.
And so there are a number of aspects to the budget that are basically geared to try to do that. And that includes what he campaigned on and promised to do, which was let certain tax cuts from the Bush administration expire, but also this adjustment of the deduction -- which is not an elimination of the deduction; it's just an adjustment slightly downward as part of this --
MR. WALLACE: But you don't have any problem with the idea of reducing the tax break that people get for buying a home when we're in the middle of a housing collapse?
GOV. KAINE: Look, I think you can argue about pieces of it. But the goal is, if we're going to reduce the deficit in half, we're going to have to eat some spinach do to so.
And so he has laid out a plan that will get us there, which is what Americans -- you know, I've -- Senator McCain is a big proponent of deficit reduction.
And in order to get there, there's going to have to be some painful choices -- choices that if we weren't worrying about deficits, we wouldn't worry about. But we're going to have to do a number of things to get to that -- get that deficit down.
MR. WALLACE: Well, you talk about eating spinach. Let's talk about how much spinach you're eating in this $410 billion spending bill before the Senate --
GOV. KAINE: Sure.
MR. WALLACE: -- which has 8,500 earmarks and an increase of 8 percent of spending. Even one of the top Democratic senators, Evan Bayh, opposes it.
And he wrote this in the Wall Street Journal: The economic downturn requires new policies, not more of the same. Why, in this case, is a reform president supporting business as usual?
GOV. KAINE: Well, I would say it's not exactly business as usual, and I agree that the earmark reform has to happen. Let's just put it in context again.
Earmarks were at their high in 2005. The number of earmarks, the amount of dollars in earmarks in this budget are 25 percent of what they were in the '05 budget.
So Congress has gotten the message, and I applaud Senator McCain and also the president, when he was senator, saying we've got to reform this process.
The amount of earmarks has been dramatically dropping since '05. The president has made plain that he's going to continue to push it, push it downward. The recovery bill that was passed was passed, at his direction, with no earmarks included.
MR. WALLACE: But Governor, why not just veto this bill? I mean, there's no time like the present.
GOV. KAINE: Vetoing an entire budget bill, an appropriations bill like this, has consequences with respect to other programs, Chris, as you know.
And so the president's going to have to weigh that, the costs of vetoing an entire appropriations bill to run government, with a set of earmarks that are being dramatically reduced from past years with -- and he has made very plain that he is going to push for earmark reform, just as he pledged to during the campaign.
MR. WALLACE: Finally, Democrats have had a lot of fun this week poking at Rush Limbaugh.
And in fact the Democratic National Committee, the organization that you run, is planning to put up a billboard in Rush's hometown of West Palm Beach, Florida. And you're having a contest to come up with a slogan -- I assume it'll be a somewhat snarky slogan, Governor, to put on the billboard.
In the campaign Barack Obama talked about changing the way business is done in Washington. And the other day he said this. Let's watch.
PRESIDENT OBAMA: (From videotape.) We know the only way to solve the great challenges of our time is to put aside stale ideology and petty partisanship, and embrace what works.
MR. WALLACE: Governor, isn't going after Rush Limbaugh a perfect example of the stale ideology and petty partisanship that the president was talking about?
GOV. KAINE: Well, it's not like Rush is a member of Congress or anyone of that kind. He's a radio personality who has been saying that he wants the president to fail.
We wouldn't even be talking about Rush Limbaugh at all, had he not said he wanted the president to fail. And then he's found others in the party and party leaders who have either echoed that claim or, in the case of Chairman Steele, denounced the claim, which I thought was courageous, but then apologized to Rush Limbaugh.
So I think there's an important point here. The billboard is a little bit of fun, admittedly, but there is an important point.
At a time of crisis in this nation, nobody should be rooting for the president to fail. Both this country and the world needs him to succeed.
Now, that doesn't mean that everybody has to agree with everything. I thought Senator McCain kind of said look, we should be a loyal opposition working together, disagreeing when we need to, but always finding areas of agreement.
If that is the spirit, then we're going to do fine. If we have people out there praying for the president to fail and trying to rally folks around that, we need to push back on that. That's just not the right message for the time.
MR. WALLACE: All right. Governor, we have to leave it there. I do want to point out, though, just as a point of information, that Rush Limbaugh says -- and I think if you read what he says -- he wasn't saying, I want the president to fail. He was saying, I want his policies, his agenda, to fail, and that he disagreed with them and thought they were bad for America.
But fair enough.
Thank you so much, Governor, for talking with us. Always a pleasure. Please come back, sir.
GOV. KAINE: I'll look forward to it, Chris. Thanks.
MR. WALLACE: Good.
Coming up, our Sunday Regulars look at the slide in the stock market. Are President Obama and his policies responsible? We'll talk about it right after this break.
(Announcements.)
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