'This Week' Transcript: Axelrod, McConnell and Queen Rania

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AMANPOUR: Hello again. And this week, the recession was finally declared over. It officially ended June 2009, but the recovery has been slow and the voters have been losing patience. With five weeks to go before the midterm elections, President Obama and congressional Democrats are facing potentially huge political losses.

Joining me now, the president's top political adviser, David Axelrod.

Thank you for joining us.

AXELROD: Great to be here.

AMANPOUR: I want to first, though, ask you about something very close to what the president has been doing, and that's Middle East peace. The moratorium expires tonight.

AXELROD: Yes.

AMANPOUR: The president asked the Israeli prime minister to keep the moratorium on. He's not going to do it. What is going to stop these talks from collapsing?

AXELROD: Well, look, I don't want to prejudge what's going to happen in the next many hours.

AMANPOUR: But is there a compromise?

AXELROD: There is still -- the parties are still working. They're still talking. Secretary Clinton and her team are working with them. We're very eager to keep these talks going. We think this is an unparalleled opportunity and a rare one, and we have to -- we have to seize the advantage of that, and we are going to urge and urge and push throughout this day to -- to get some kind of resolution.

AMANPOUR: So you think you'll manage to urge to keep the moratorium on? Or is that going to expire?

AXELROD: Well, I'm not going to get into the details of what's being discussed, but what is most important now is that the parties are at the table, they've having serious discussions, they ought to keep on having those discussions, and we are very eager to see that happen.

AMANPOUR: Do you see any creative compromise to make that happen? The Palestinians say they would walk.

AXELROD: Well, I understand what the public pronouncements have been, but the parties are at the table. They are talking. They're trying to work this through, and we're hopeful that they will.

AMANPOUR: You know, King Abdullah, one of the president's main partners in this process, has said on Jon Stewart that there could be war if this moratorium expires. How do you take that?

AXELROD: Well, look, obviously, this is a -- there -- there are a lot of stakes here. And I saw that quote. I'm not going to comment on that quote, but everyone -- everyone understands that these talks themselves are absolutely crucial. We're at a pivotal juncture in that region. It's important for Israel. It's important for the Palestinians. And we think it's essential that they keep on moving forward, keep on talking, keep on trying to work through these issues.

AMANPOUR: Will they?

AXELROD: And we're hopeful that they will. We're hopeful that they will.

AMANPOUR: Let me turn now to the political situation, and particularly in light this week of something else everybody is talking about, and that is the CNBC town hall meeting that the president had right here in the Newseum at which one of his staunch defenders stood up and said that she was getting tired. Let me play this for you.

(BEGIN VIDEO CLIP)

(UNKNOWN): I'm exhausted. I'm exhausted of defending you, defending your administration, defending the mantle of change that I voted for, and deeply disappointed with where we are right now. I -- I have been told that I voted for a man who said he was going to change things in a meaningful way for the middle class. I'm one of those people, and I'm waiting, sir. I'm waiting.

(END VIDEO CLIP)

AMANPOUR: A lot of people are waiting, Mr. Axelrod. How is the president -- how are you going to jazz your -- your -- your electorate, your base ahead of these elections?

AXELROD: Well, first of all, let's understand that we've gone through a terrible time in this country. I understand what she was saying. The middle class has taken a terrible beating, not just in the last two years of this recession, but over the last 10 years. We learned in the -- in the last few days that the middle class lost 5 percent of their income from 2001 to 2009, and of course that period ended with the worst economic crisis since the Great Depression.

The key here is to keep moving forward, to keep doing things that have at its core -- that has at its core the economic security of the middle class, which is key to our economic growth, not to go back to the policies that created the crisis in the first place.

AMANPOUR: All right. But really a lot of people -- I mean, people from all over the world, frankly, say to me here comes a president with a huge mandate, a huge reservoir of goodwill, huge promises to change, and with all of that, his popularity is down. People don't appreciate some of the amazing legislative agenda that he's accomplished. Is this a failure of leadership? Has he allowed the opposition to define him?

AXELROD: I don't think you -- I don't think, Christiane, that you can say he's accomplished all these amazing things and it's a failure of leadership.

AMANPOUR: But the results.

AXELROD: It was leadership that produced that. We are in the -- we have endured the worst economic crisis since the Great Depression. It took a decade to build up to that. It'll take more time than anybody would like to -- to deal with the remnants of it. There's devastation as a result of that.

And we're working every day -- I mean, we're obviously in a different place from January of 2009, when we were losing 700,000, 800,000 jobs a month. Now we've had job growth all this year, private-sector job growth, but we have to accelerate that, and the president's made a series of proposals to do that. Hopefully we can get some cooperation on the other side to make that happen.

AMANPOUR: Well, the other side, as you know, has brought out their Pledge for America. The Republicans are feeling very confident right now. And people are looking at, you know, what happened in 1994, when President Clinton lost Congress to -- to the Republicans then.

And he actually had some advice for President Obama, which he told George Stephanopoulos. I'd like to play that right now and get your reaction.

(BEGIN VIDEO CLIP)

CLINTON: I'd like to see him say, "We couldn't get out of this $3 trillion hole in 21 months. Give us two more years. Don't go back to the policies that dug the hole. But if we don't do better" -- this is the last thing -- "if we don't do better, you can vote against us all, and I'll be on the ballot, too. Vote against us all if it's not better."

(END VIDEO CLIP)

AMANPOUR: So is that good political advice, vote against us all? Is that what President Obama will take, that advice? Will you say that to people?

AXELROD: Well, President Clinton is a -- is a great politician, and I'm not in any way going to quarrel with him. I think people in 2012 will vote on this. I don't think they need an invitation to do so.

I think the -- the crux of what he's saying is absolutely right, though. When you look at that Pledge to America, it is a complete echo of what was done before. It would borrow $700 billion to cut taxes for the very wealthy, add trillions of dollars to the deficits. It would unleash the special interests to be writing rules here on Capitol Hill again.

And it would cut things like -- there's a 20 percent cut in there for education. We're talking about our economy. Education is the defense budget of the -- economic defense budget of the 21st century, and they're basically talking about disarmament. Eight million kids would have their college aid slashed under this budget. This isn't a prescription for economic growth; this is a prescription for surrender. We can't do that.

AMANPOUR: What about one of the things that the president has been talking about for so long, and that is the tax breaks? Why did the Democrats decide to push that aside before the midterms?

AXELROD: Well, look, here's where we are, and you can talk to your next guest about it. What the Republicans have said -- and they've said it again in this pledge -- is what we've said is we want to extend tax cuts for people up to $250,000 of income. That would cover 98 percent of the American people.

They say, no, we won't do that alone. We want to borrow another $700 billion over the next 10 years to give tax cuts to millionaires and billionaires. And we're saying we can't afford that, not in our fiscal condition.

And so -- and now they want to hold those middle-class tax cuts hostage until we -- unless and until we agree to that, and that's something we can't do.

AMANPOUR: But if you can't do it now and you're not going to do it now, how are you going to do it after the elections, when you might have less of a majority?

AXELROD: Well, here's what I believe. I believe, when these Republican members return to their districts, they're going to have to explain to their constituents why they're holding up tax cuts for the middle class. And I think it's an untenable position to say, "We're going to allow your taxes to go up on January 1st unless the president agrees to give tax cuts to millionaires and billionaires."

AMANPOUR: But does he want...

AXELROD: This is exactly how we got into the jam we were in before. This is how they quadrupled the national debt and exploded the deficits and squandered the surplus that Bill Clinton left them.

AMANPOUR: People are very upset about the national debt and the -- and the deficits and all (inaudible) right now.

AXELROD: Yes, well, they should be.

AMANPOUR: But also, the president talked about extending the middle-class tax cuts. Can you do that after the election?

AXELROD: Well, we're going to get that done. One way or the other, we're going to get it done. And I believe the pressure is going to build among the American people. I don't believe Senator McConnell or anybody else is going to be willing to stand up to the American people and say, "We're going to hold your tax cut hostage so that we can give another large tax cut to -- to millionaires and billionaires that we can't afford."

AMANPOUR: Quick answers to some of the statements that have come out in Bob Woodward's book, particularly some about yourself. General Petraeus, the commander now in Afghanistan, said a couple of things, according to the book. One, this White House, they don't know who they're XXX with, messing with. And another, that he didn't like talking to you, because you are, quote, "a complete spin doctor."

AXELROD: Well, look, I've seen General Petraeus in interviews with you and others and I've always been impressed by how deft he is on TV, so I assume he meant that as a compliment.

AMANPOUR: Oh, you think so?

AXELROD: Yes.

AMANPOUR: Tell me how you think you're going to -- and do you believe there will be a confrontation between what the White House believes, which is to have this drawdown in 2011, and what General Petraeus seems very, very clearly to be laying the groundwork for, and that is much, much less of a drawdown, if at all, by 2011?

AXELROD: I think General Petraeus and everyone involved was there through this process and at the end of the process. And everyone agreed that the drawdown would begin in July of 2011, and not a trivial drawdown, but a real drawdown.

AMANPOUR: And one last question. Everybody's also talking about, you know, reshuffles in the White House. Rahm Emanuel, who apparently wants to run for mayor of Chicago, will he leave before the midterms?

AXELROD: Well, look, filing for that is November 22nd, I believe, in Chicago. And obviously it takes some time, if you're going to run for mayor, to do it. So it stands to reason that he would have to leave earlier if he decides to do it, and that's something he's still working through.

AMANPOUR: What's your -- if you had to bet, will he do it? And will he leave before the midterms?

AXELROD: I never bet on national television.

AMANPOUR: What do you think will happen?

AXELROD: I think that he loves the city of Chicago, he's always believed that that was the greatest job there is, and so I think he's drawn to it, but he still has family considerations to think about, and -- and he's working those through.

AMANPOUR: David Axelrod, thank you very much, indeed.

OK. I didn't ask you about Karl Rove.

AXELROD: I know. I'm really upset about that.

AMANPOUR: OK, I'll ask you about Karl Rove.

AXELROD: OK, do it.

AMANPOUR: Yes, even if we put it online, OK?

AXELROD: OK.

AMANPOUR: Can I just ask him quickly? Yes? Can we roll? Are we ready? Yes, sorry, OK.

Big front-page article in the New York Times today about the return of the Republican guru, Karl Rove. What do you think that's going to mean? You guys can't get your message out, apparently. They're pretty good at doing it.

AXELROD: Well, first of all, I would quarrel with the first part. We'll see what happens in November. I think as people become familiar with what the Republicans are proposing, I hope they all read that Pledge to America and will see -- I suspect it'll get a lot closer than you believe.

AMANPOUR: But will his involvement...

AXELROD: But here's the -- here's the thing about Karl Rove and what he's doing. The insidious thing about it is they are funding negative ads all over the country against Democratic candidates paid for by major corporate special interests who don't have to disclose their participation, the oil industry, Wall Street, insurance industry.

We put a bill in the United States Congress asking one thing -- and this was a loophole that was opened by the Supreme Court earlier in this year -- we put a bill in the -- in the -- in the Congress saying, disclose who is funding these campaigns. Let the American people know who's paying for these ads. It's a very simple premise.

Your next guest, Senator McConnell, has blocked that consistently. And, you know, there's an old saying that if you -- if you want to keep things secret, you have something to hide. You want to ask Senator McConnell what it is that they are trying to hide.

AMANPOUR: But do you think you'll have an impact?

AXELROD: Absolutely. I mean, if you -- they're spending tens of millions of dollars. In some districts, they're spending more money than the candidate -- candidates themselves on negative ads from benign-sounding Americans for Prosperity, the American Crossroads Fund. No. These are front groups for special interests. These are front groups for foreign-controlled companies, which would have been banned under the bill that we put through Congress, and they don't want the American people to know, and the American people ought to be alert to that.

AMANPOUR: One other question. With all this talk -- and you're going to be leaving in the spring to -- to go back and -- and do the president's re-election campaign -- there are people who are saying that a shuffle might be a really good thing for this president, because there's a lot of insularity, that he's sort of out of touch with where the country is on things like jobs, things like spending, deficits, debt, and it would be good to have pushback.

AXELROD: Yes.

AMANPOUR: Do you think that's possible, if there's a reshuffle?

AXELROD: Well, I don't think he's out of touch. I think he's very much in touch. We're trying to clean up an enormous mess and help the middle class get back what was taken from them over the last 10 years.

But in terms of your question, I think change is -- it happens in every administration, and I think change is healthy. There's a renewing quality to change. Some people who are there are going to be there for a long time; others will go, and new people will come in with new energy and new ideas. That's good for the president. It's good for the administration. I don't think that's a negative at all.

AMANPOUR: And when will you go?

AXELROD: Well, my plan has always been -- and I -- and he knew it, and almost everyone around me knew it, that I would stay into next year and then go home and, as you say, begin working on the re-election campaign.

AMANPOUR: So early spring, late winter?

AXELROD: Something like that. Something like that. But I'm eager for the next eight months, nine months here. We've got a lot of work to do.

AMANPOUR: David Axelrod, thank you very much.

AXELROD: Thank you.

AMANPOUR: Our Web extra.

Thank you.

AMANPOUR: And joining me now is the Republican leader in the Senate, Senator Mitch McConnell.

Welcome to "This Week."

MCCONNELL: Good morning.

AMANPOUR: Thank you for joining us.

MCCONNELL: Glad to be here.

AMANPOUR: You heard what David Axelrod said about the Republican plan on extending all the Bush-era tax cuts and that it would really, you know, put the country more in hock. Analysts say that'll cause, you know, add some $4 trillion or so to the national debt. Are you really going to do that? Or do you think there would be a compromise on extending the middle-class tax cuts?

MCCONNELL: Well, let's understand what we're talking about here. This has been the tax rate for a decade. We're talking about raising taxes in the middle of a recession. And most economists think that's the worst thing you could do. The president himself was saying that was the worst thing you could do a year-and-a-half ago.

AMANPOUR: So do...

MCCONNELL: Raising taxes in the middle of a recession is a particularly bad idea, and Republicans don't think that's what we ought to do.

AMANPOUR: So do you not think you really, quote, unquote, "hold the middle-class tax cuts hostage" to all the tax cuts you want to...

(CROSSTALK)

MCCONNELL: Well, nothing's being held hostage to anything. It was the Democrats themselves who decided not to have this debate.

AMANPOUR: But would you compromise on that, even after the election?

MCCONNELL: I -- I was the only one who offered a bill. There was never a bill in the Senate. And you know why? Thirty-one Democrats in the House, five Democrats in the Senate said they agreed with me, that we ought not to raise taxes in the middle of a recession.

What might happen down the road is not the subject today. The question is, do we want to raise taxes in the middle of a very, very tough economy? All the Republicans think that's a bad idea, and a substantial number of the Democrats think the same thing.

AMANPOUR: Right, but there's also this huge thing that the people of the United States are worried about, and that is the deficit.

MCCONNELL: Absolutely.

AMANPOUR: And adding -- keeping the tax cuts will add trillions to that. And let me ask you this. According to Howard Gleckman at the Tax Policy Center -- let's see what he's just written -- "McConnell would have to abolish all the rest of the government to get a balance by 2020, everything. No more national parks, no more NIH, no more highway construction, no more homeland security, oh, and no more Congress."

MCCONNELL: Let me tell you...

AMANPOUR: So where would you...

(CROSSTALK)

MCCONNELL: Let me tell you how I'd reduce the deficit. There are two things you need to do. Number one, you need to get spending down, and number two, we need to get the economy going.

AMANPOUR: Right.

MCCONNELL: Everything that's happened in the last year-and-a-half has been to pump up the government. We borrowed stimulus money. We spent it to hire new federal government workers. We sent it down to states so they would not have to lay off state workers. You have to get the economy going.

That's the way you narrow the deficit. You get the economy going. You get government spending down. Throw a tax increase in there, and we're going to have this recession go on who knows how long.

AMANPOUR: But you're still not saying where the big, big cuts would come from, because some of the things you're thinking about...

(CROSSTALK)

MCCONNELL: Well, let me give you an example of something...

(CROSSTALK)

AMANPOUR: ... I mean, would it be Social Security or Medicare, Medicaid? Would it be the defense?

MCCONNELL: Let me give you an example of something we've done already. Senate Republicans offered to freeze the top line on next year's appropriations at essentially what we spent this year. The difference between that and what the president asked for over a 10-year period would be $300 billion.

With regard to the entitlements, the president has appointed a deficit reduction commission. I've appointed three members to it. John Boehner has appointed three members to it. They're going to report in December and make a recommendation about what we might do about our -- our long-term unfunded liabilities. We'll wait and see what they recommend, but hopefully it'll be something that'd be supported on a bipartisan basis.

AMANPOUR: So all of -- all of this comes into the Pledge for America, which was announced this week, a platform for future governing by the -- by the Republicans. Now, many people say that it's simply more of the same. You've obviously heard a lot of that over the last couple of days, that there's basically nothing new. And whether they're left, right or center, people are complaining that, in fact, it doesn't go far enough, particularly for the -- the very enthusiastic Tea Party base that you have.

So, for instance, Erick Erickson has written about this pledge. "It's full of mom-tested, kid-approved pabulum that will make certain hearts on the right sing in solidarity. But like a diet full of sugar, it would actually do nothing but keep making Washington fatter before we crash from the sugar high."

How are you going to -- well, you're laughing.

MCCONNELL: Well, any time you do anything in public life, somebody criticizes it. Go ahead. I'm sorry. I didn't mean to...

AMANPOUR: No, that's all right. But I want to ask you, how will you satisfy the -- the base, which seems to be, really, in insurrection now, the Tea Party? Would you -- would you agree that they're...

MCCONNELL: Yes, let me tell you what...

AMANPOUR: ... cascading into your space?

MCCONNELL: Let me tell you what everybody agrees on, everybody agrees on. The primaries are over, and we all agree we want to go out and beat the Democrats November 2nd.

AMANPOUR: Right.

MCCONNELL: So there's all kinds of energy in the Republican Party or people who are inclined to vote Republican. The Tea Party people are not all Republicans, some independents. But one thing we know about everybody who's been active in this movement, we know none of them are going to go out and vote Democrat on November 2nd.

We may have some internal differences about various parts, but everybody knows who's been in charge of the government for the last year-and-a-half.

AMANPOUR: Well...

MCCONNELL: Everybody knows who's been in charge of the government for the last year-and-a-half. The Democrats have had the White House, they've had a huge margin in the House, a big margin in the Senate, and they know that if they want to save America, they've got to change the Congress, and that's going to happen on November 2nd.

AMANPOUR: Well, as you know, the -- the recession was declared over. There's no recession, and maybe will say that, you know, they stopped it from going into a Great Depression, and that they inherited this -- this...

(CROSSTALK)

MCCONNELL: But, Christiane...

AMANPOUR: ... situation. But let me ask you this. You say you want to go out and win in November. I want to play for you something that Tom Ross, the chairman of the Republican Party in Delaware, said to me on this program right after Christine O'Donnell, the Tea Party candidate, won in that last primary in Delaware. Let's -- let's just play what he said.

(BEGIN VIDEO CLIP)

ROSS: We had a candidate that was very close to becoming the next United States senator from Delaware, and essentially people on our own team clipped him right as he was about to go on the goal line.

(END VIDEO CLIP)

AMANPOUR: Right. So that's Mike Castle, who they thought would win that -- that election come November. Now, he's basically saying perhaps not. So how do you square that? I mean, do you think these Tea Party candidates will be good for you in November?

MCCONNELL: Look, there are 12 places now, right now, where there's a Democratic senator where our candidate is either a little bit behind, dead even, or well ahead: California, Washington, Nevada, Colorado, Illinois, Pennsylvania, Indiana, North Dakota, Arkansas, Wisconsin, Connecticut, West Virginia. We're competitive in a lot of places.

Will we win them all? Who knows? The Delaware primary was interesting, a new candidate, fresh face. I think she's got a good chance of winning.

AMANPOUR: I mean, she definitely wasn't your candidate. I mean, basically, they -- one would way that the -- the Republicans...

MCCONNELL: You've picked out one Senate race.

AMANPOUR: No, no, no, no, many...

MCCONNELL: I just gave you 12 places where we have a chance of being Democrats.

AMANPOUR: Even -- even in your own state. And I want to ask you, actually, what are the qualifications are -- do these people have? For instance, what is Christine O'Donnell's qualification for actually governing? What is Sharron Angle's actual qualification for governing?

MCCONNELL: Well, they won the primary fair and square against real competition, and they emerged as the nominee. And Sharron Angle is running no worse than dead even against the majority leader of the Senate. I think that's pretty significant.

AMANPOUR: And you're not -- are you not afraid that they might be a turnoff...

(CROSSTALK)

MCCONNELL: Am I afraid of having more Republicans in the Senate? Of course not.

AMANPOUR: No, that wasn't the question. The question is, are you not afraid that their somewhat, one would say, some might say, bizarre statements, their sort of fringe quality might actually turn people off? I mean, for instance, what do you say about a Sharron Angle, who I know you just had a fundraiser for, who basically talks about enemies in Congress and talks -- and hints about, you know, armed rebellion to put them down? I mean, is that the kind of talk from a United States senator?

MCCONNELL: You know what most Americans think is extreme?

AMANPOUR: No, I'm asking you that question.

MCCONNELL: Well, I know.

(CROSSTALK)

MCCONNELL: I'm going to answer it. I'm going to answer it. What most Americans think is extreme is the kind of government we've been running for the last year-and-a-half. We've seen the government taken over banks, insurance companies, car companies, nationalizing the student loan business. We're on a path to double the national debt in five years and triple it in 10.

Most Americans think what's been happening around here for the last year-and-a-half is extreme, and they want to change it. And they know that the way to change it is to change the Congress, because you don't get to make policy unless you get elected.

AMANPOUR: But you didn't tell me what you think about those kinds of comments from people who want to be, you know, a senator. I mean, it's kind of bizarre, don't you agree?

MCCONNELL: I don't think the people of Nevada should be attacked for the choice they made in the primary. And the candidate is running dead even with the majority leader of the United States Senate. Obviously, the people of Nevada think that she's a very good candidate or she wouldn't be running even with someone of such power and significance.

AMANPOUR: Do you think there will be more bipartisan compromise when they come in or less?

MCCONNELL: I think the way to get bipartisan compromise is to not have one side have an overwhelming majority. And the American people know that if they're frustrated with this administration, it won't change on November 2nd. The president will still be there for at least two more years. But they can take the first step toward moving this government back toward the political center, and maybe even a little bit right of center, if there's a very good election.

AMANPOUR: Senator Mitch McConnell, thank you very much for joining me.

MCCONNELL: Thank you.

(COMMERCIAL BREAK)

(UNKNOWN): The fresh and new ideas sound slightly like -- I'm sorry, did I say slightly -- exactly like your old ideas.

(UNKNOWN): Rein in the Washington, D.C., red tape.

(UNKNOWN): Cut Washington red tape.

(UNKNOWN): Act immediately to reduce spending.

(UNKNOWN): Have real reforms to reduce spending.

(UNKNOWN): Change the way we do business in Washington.

(UNKNOWN): Change business as usual in Washington.

(UNKNOWN): Make the tax cuts permanent.

(UNKNOWN): Make the existing tax cuts permanent.

(UNKNOWN): A smaller...

(UNKNOWN): ... a smaller...

(UNKNOWN): ... less costly...

(UNKNOWN): ... less costly and more accountable...

(UNKNOWN): ... and more accountable government in our nation's capital.

(UNKNOWN): ... government in our nation's capital.

(END VIDEO CLIP)

AMANPOUR: Jon Stewart from "The Daily Show" with his own take on the House Republican Pledge to America, one of the topics we'll discuss today on our roundtable with George Will, Democratic strategist Donna Brazile, Ron Brownstein of the National Journal, and Matthew Dowd, former Bush political strategist.

Welcome to you all.

So, George, Pledge to America. It's nice. It's glossy. There are lots of pictures. Is it new?

WILL: No, in the sense that Mr. Stewart's quite right, that Republicans are acting like Republicans, which is sort of what they want to do, limited government, smaller government, less spending.

This was prepared against the backdrop of what I consider the most important number in all the blizzard of numbers we're hearing this year: One in four, only one in four Americans expect their economic condition to be better next year than this year, so they're gloomy.

They blame it on that institution six blocks away and the one 10 blocks away that way.

AMANPOUR: So Congress and the White House?

WILL: Congress and the White House. And that's why in that pledge the word "spending" appears 47 times. The perfunctory nod to the social issues, but this is about economics.

AMANPOUR: Spending. I tried to get it out of Senator McConnell. You know, they talk about rolling back spending, but where? Where? Are they going to take on the big, big, big issues of Social Security and all the rest?

DOWD: Well, the interesting thing about this, first of all, the only people who are going to have read this thing are the person that wrote it and maybe the person that printed it. It's not going to have any effect on the election.

But the problem that -- what the country is that they don't trust either party on spending. They went through years where -- and during the Bush presidency, where spending rose dramatically, now they're -- now two years into the Obama presidency, where spending has risen dramatically. So the country doesn't really trust any of them, so that's why they're trying to kick out -- and the next round of -- they kicked them out in 2006. They're going to kick out a whole bunch in -- this year, 2010.

That's the problem, that the country does not trust either political party to do what they want to do, so that's why they're sending what many people consider fringe candidates to Washington.

BROWNSTEIN: You know, it's not only the political parties they don't trust. And this is where I would amend or disagree a little bit with -- with George.

What happened after 2008, after the financial meltdown, was that trust cratered in both government and business. Obama overestimated the extent to which the public would be looking -- clearly would be looking to government to counteract business via -- have a larger role in the economy, and they are seeing the backlash of that now. There's -- clearly, a portion of what's happening now is an ideological backlash among voters who simply don't trust Washington to do the kinds of things that the Democrats have set it on a road to do.

On the other hand, there is a tremendous loss of faith in business, as well. And I think Republicans do face the risk -- if -- depending on how they interpret what happens in November -- of coming in and, as in '95, trying to go too far in the other direction and seeing a backlash again against (inaudible) government.

We've done polling in the last few weeks. Only one-third of Americans say they support extending the Bush tax cuts to everybody, including those over $250,000. Only one-third support the idea of repealing health care completely, and only one-third support the idea of converting Medicare into a voucher for seniors, as some of the House Republicans want to do.

BRAZILE: You know, Christiane, I read it. It's retro. It's recycled old material from the past. It's vague. It's a fig leaf to cover the thinness of their proposals.

There is some spending in that -- in that booklet. It's spending more on the military. It's spending money that we don't have. It's spending more on tax cuts that we can't afford. So this is an opportunity for Republicans to finally say we're for something, but it gives Democrats to say what they've been against over the last 18 months.

AMANPOUR: Right, but given what Ron just said about the numbers and what people think about -- about health care and the -- and the rest, why then haven't the Democrats been able to translate that into a positive message?

BRAZILE: Because I think it's been very difficult to have a narrative that tells the American people exactly what they don't want to hear, that we've spent your money, your taxpayers' money, to try to avoid a total meltdown on the economy, to invest in things that the Republicans didn't care about, and to try to put the economy back on the -- on a sane footing. That has not translated into votes, and it hasn't given Democrats a real opportunity to campaign.

DOWD: I think the real problem is, is that nothing has happened since Barack Obama's taken office that's positive in the American public's mind. Their health care costs have risen. Their premiums have risen on -- on their health care. The job situation has worsened. The deficit has worsened. Everything since January 20, 2009, has gotten worse.

AMANPOUR: But hasn't -- when you say nothing's happened, he's pushed a huge amount through Congress, unprecedented amount. Are you saying nothing's happened...

(CROSSTALK)

DOWD: The public does not judge success based on passing a bill in Washington. The public judges success by whether or not their life is better, and it has not changed.

AMANPOUR: Right, but there's no depression. There's -- the recession has ended.

BROWNSTEIN: Well, but they're not seeing -- the people are not seeing tangible -- tangible gains in their life, as Matthew said. I mean, look, I think you have -- you have two things -- the public view is actually pretty nuanced, if you look at polling. I mean, you go out and you talk to people.

By and large, more Americans think that the policies of Bush than Obama certainly led to this -- taken into this cataclysm. On the other hand, they have judged that what Obama has done over the past year-and-a-half has not made things better, and that is the driving force of the election.

Now, what Democrats are trying to do in these last few weeks, by focusing on Republican policies, is basically saying, look, the issue shouldn't be about what's happened over the last 20 months. It shouldn't be a referendum. It should be a choice about alternative directions going forward. That is a very hard place to get the voters in a midterm election.

AMANPOUR: You think it will be a referendum?

WILL: Well, look at the difficulties they have. They passed a stimulus which by their own standards did not stimulate, didn't keep unemployment at 8 percent. They passed a health care bill that may not be, as Michael Barone says, the most unpopular measure legislation since the Kansas-Nebraska Act of 1854, but it's unpopular. So then they said, well, we'll run against George W. Bush. Well, in Ohio, Mr. Portman is about to be elected senator, who was a close aide of George Bush. "Let's run against Wall Street." Well, in Ohio, Mr. Kasich is leading in the race for governor. He worked for Lehman Brothers. None of these standard lines of theirs have worked.

AMANPOUR: And we just were talking about -- you just mentioned the word "fringe." I asked Senator McConnell about some of these, you know, Tea Party candidates who may be going to the Senate. And you've just written this article, "Extreme Makeover," whose subtitle is, "The midterm elections could send to Washington the most militantly conservative class of new senators in at least the past half-century." What will that mean?

BROWNSTEIN: Well, it's going to be -- I think it's going to be a stronger infusion of conservative energy and more uniformly conservative energy than we saw even in the class of '94 or 1980. There are a range of views among this class. If you look at the 21 Republican Senate challengers with the -- with the best chance of winning, there are a range of views in terms of the long-range agenda.

Someone like Christine O'Donnell or Sharron Angle or Joe Miller in Alaska would go further than Rob Portman or Roy Blunt or some of the other -- John Hoeven in North Dakota, the more conventional candidates. But when you look at what is actually going to be on the table in the next couple of years, there's more unanimity and a more consistently conservative line among this Republican class than we have seen, really, at any point.

Just a couple quick examples. All 21 of them say they will extend the Bush tax cuts; 20 of 21 of them say they will oppose any future tax hikes; 20 of 20, all of them have taken a position supporting a balanced budget amendment; they all oppose cap and trade; 19 of the 20 who've taken a position say that global climate change is unproven or actually a hoax.

So in the near term -- in the long term, there may be differences about some candidates wanting to go further about rolling back the minimum wage, unemployment benefits, or Social Security. But on what they will actually be dealing with, you will see, I think, a very strong pull toward a more conservative -- consistently conservative position in that Republican caucus.

AMANPOUR: But doesn't it just add to the deficit, all these tax cuts?

BROWNSTEIN: Well, making all of those things add up is going to be the challenge both in the near term and the long term, absolutely.

BRAZILE: But, you know, the Republicans have a great story right now to tell. Excuse my voice. I was up watching the LSU game, clearly.

But the -- the problem I have -- and the Republicans should -- should understand -- is that there's still an eternal civil war going on within the Republican Party. In Washington state, in Delaware, and Colorado, many of the mainstream Republican candidates have not endorsed the Tea Party candidates.

They've provided enthusiasm, they've provided a lot of energy and organization for the Republican Party, but we don't know yet if the Republicans can heal those wounds and provide the kind of turnout they need to beat the Democrats.

DOWD: I think that if you gave most Democrats truth serum and they said who's place would they rather be in, they would pick the Republicans' place in this year's election as opposed to their own place in this year's election. The problem I think for this class that's coming in for the Republicans is for Mitch McConnell, who just talked to, is his ability to herd them is going to be like herding quail, because these folks are coming to Washington and think, "I'm not going to be part of this. I'm not going to listen to the leaders. I'm going to do what the voters want me to do," and they're not going to be -- they're not going to be acquiescent to what the leadership wants.

AMANPOUR: And that's what I actually -- I wanted to ask, because in today's newspaper, there's a quote by a senior Republican, you know, consultant that, after the elections, it's going to be basically all-out war, a struggle for the heart and the soul of the Republican Party. You're shaking your head.

WILL: They've been writing this story for eight months about what a problem the Tea Party is for the Republican Party. You know what the problem...

(CROSSTALK)

AMANPOUR: Well, Tom Ross basically told us that they lost because of that and they might lose.

WILL: On balance across the country, the Tea Party is enormous help for the Republicans. At the beginning of the year, the question was, will the Tea Party people play nicely with others and will they obey the rules of politics? Who's sort of not playing nicely? Mr. Crist starts losing the primary to a Tea Party favorite Rubio. He suddenly discovers that he's an independent and changes all his views overnight.

Mrs. Murkowski loses a primary and suddenly discovers that she has a property right in her Senate seat and she's going to run as a write-in. Senator Bennett thought of that in Utah, Senator Castle in Delaware is thinking of a write-in candidate. Who are the extremists?

(CROSSTALK)

BROWNSTEIN: Donna, I would say, look -- I mean, I think clearly this class of Republicans do not feel they are being sent here to Washington to compromise with Barack Obama or to follow the Republican leadership. So in that sense, there's going to be tension. And I quote Ken Buck in my story as saying so.

But if you look at what they are actually going to be voting on, in all likelihood, over the next two years, there is remarkable unanimity in this class. And despite all the focus on the civil war, I think that is kind of a -- what the long-range vision of what the federal government should be doing or not doing is where you will see diversity.

(CROSSTALK)

BROWNSTEIN: But in the near term -- in the -- in the near term, I think -- in terms -- the main thing that the Republicans, I think, are being sent here to do is to block and try to roll back whatever they can what Obama did. I think the spending thing will continue to be a challenge for them, because if you want to reduce the deficits and extend the Bush tax cuts, that does point you back toward cutting Medicare and Medicaid, which is exactly the problem they got into in '95, and they may end up in that same cul-de-sac next year.

But I actually believe there is more commonality in this class than is often assumed. And in the near term, they are going to be a very formidable and, I think, cohesive force.

WILL: And look at the not-so-near term. In the next two cycles, 2012 and 2014 combined, the Democrats are defending 43 Senate seats, Republicans 22. So the Republican wave that's now starting is just starting.

(CROSSTALK)

AMANPOUR: Let's turn to a real war, and that is Afghanistan and Bob Woodward's inside fly-on-the-wall look at it. Can I just ask you, yes, he is a brilliant writer, and he sells books. Why would the White House over and over again give him the keys?

DOWD: Well, I think part of it -- this happened in the Bush White House. There is this appeal about him, based on 30-something years ago and what happened with Watergate, and he has an aura about him that people think they have to talk to him if they want to be part of the history, that Bob Woodward, you've got to talk to Bob Woodward if you want to tell your narrative in history.

So they go to his house and they sit around and have sandwiches and iced tea or lemonade and they talk, because they want to be part of history.

AMANPOUR: And it turned out quite well, would you say, for the administration?

BRAZILE: Well, it showed that the president was decisive, that he was involved deeply in the strategy in Afghanistan, that he participated in all of the internal discussions, and that he allowed his inner circle to have disagreements. I think people talk to Bob Woodward because they know that Bob will talk to you or go talk behind your back to someone who knows you.

BROWNSTEIN: Whatever the answer is, I wish I knew it, because it would be a great way to get -- you know, best-selling books. But I think, you know, what the book portrays is, I think, understandable ambivalence. Who would not be ambivalent about the choice between letting Afghanistan devolve into chaos with implications for Pakistan and going forward with all of the problems we face with a very weak partner there?

AMANPOUR: Last word, George.

WILL: The book distracted attention from the fact that a corrupt government elected by a corrupt election presided over another corrupt election in Afghanistan.

AMANPOUR: This weekend was -- was pretty dire for that, indeed. And this conversation will continue in the green room.

And we just also wanted to give you a word about a special program next week. The plans to build that Islamic center near Ground Zero has unleashed an international debate, raising questions about America's uneasy relationship with Islam. So next Sunday, we're going to hear from all sides in this debate. It's called to be called "Holy War: Should We Be Afraid of Islam?" You can submit questions to on my Facebook page or at our Web site, abcnews.com/townhall.

And this coming Friday, Diane Sawyer anchors a special edition of "20/20," reporting on Islam and taking all the questions and answers.

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