Transcript: Terry Moran Interviews President Obama

OBAMA: No. I think that what I want is an American system that works well for the American people. And I think it is possible, and there are examples out there, of private systems, a free market in health care. But a situation in which we assure that everybody has coverage.

That there are certain rules of the road and certain practices that are observed by insurance companies so that people are getting a fair deal. And I would like to make sure that all the families that I'm hearing from day in and day out who are getting battered by rising health care costs or no health care at all, that they get some relief.

And I'm also, you know, looking at the federal budget projections for the next 10, 20 and 30 years. And I feel a responsibility that if we don't do something about it then we are going to have some really bad choices down the road. And that's the irony of this thing.

What's been fascinating to me is the degree to which some of the same folks who are responsible for handing me trillions of dollars worth of deficits over the next decade because they didn't pay for tax cuts or initiatives that they had put forward, are now suggesting somehow that this is another big government spending plan, when in fact, they know, you know, and for some reason this doesn't get hammered home as much I'd like to see in the press, that if we don't reform the system that is the absolute worst thing we could do in terms of our fiscal situation. That's not disputed.

And so the only way that we're going to get control of this thing is if we reduce health care inflation to manageable levels. And I think that can be done.

MORAN: I want to shift gears here. Afghanistan -- this has been the deadliest month for American and NATO troops in Afghanistan ever.

Define victory in Afghanistan, or maybe that's not the right word.

OBAMA: I'm always worried about using the word "victory" because, you know, it invokes this notion of Emperor Hirohito coming down and signing a surrender to MacArthur.

You know, we're not dealing with nation states at this point. We're concerned with al-Qaeda and the Taliban, al-Qaeda's allies. So when you have a non-state actor, a shadowy operation like al-Qaeda, our goal is to make sure they can't attack the United States.

Now I think that's going to require constant vigilance. But with respect to Afghanistan, what that means is -- or Pakistan, for that matter. What that means is that they cannot set up permanent bases and train people from which to launch attacks. And we are confident that if we are assisting the Afghan people and improving their security situation, stabilizing their government, providing help on economic development so they have alternatives to the heroin trade that is now flourishing.

If on the Pakistani side, we are helping to stabilize the northwest provinces and giving them assistance and providing people a good livelihood. Those things will continue to contract the ability of al-Qaeda to operate. And that is absolutely critical.

MORAN: Is Pakistan helping or hurting American efforts in Afghanistan, or both?

OBAMA: Well, I think that at this point what you've seen is the Pakistani military step up in a way that we have not seen. I mean, they are engaged in serious fighting of al-Qaeda allies in that region and are trying to reassert control into areas that have become lawless.

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