'This Week' Transcript: Gov. Arnold Schwarzenegger and Gov. Edward Rendell

Feb. 21, 2010 — -- MORAN: Good morning, and welcome to "This Week." The battles lines are drawn.

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OBAMA: It's a whole lot easier to say no to everything. It's a whole lot easier to blame somebody else.

FORMER GOV. MITT ROMNEY (R-MASS.): We conservatives don't have a corner on saying no. We're just the ones who say it when it's the right thing to say.

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MORAN: While another Democrat leaves the Senate and calls the system broken.

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SEN. EVAN BAYH, D-IND.: I do not love Congress.

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MORAN: Is Senator Bayh right? Can Washington solve our most pressing national problems, the economy, the debt, health care? Questions for our exclusive headliners, two prominent governors who call it like it is, Republican Arnold Schwarzenegger of California and Democrat Ed Rendell of Pennsylvania, together with their own bipartisan agenda for rebuilding America's infrastructure. Schwarzenegger and Rendell, only on "This Week."

Then.

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TIGER WOODS: I was wrong. I'm embarrassed. I am so sorry.

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MORAN: The Tiger Woods confession. That and the week's politics on our roundtable with George Will, Donna Brazile, political strategist Matthew Dowd and Arianna Huffington of the "Huffington Post." And as always, the Sunday funnies.

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DAVID LETTERMAN, TALK SHOW HOST: Tiger Woods is making a televised public apology. Televised public apology tomorrow. He needs three more to tie my record.

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MORAN: And good morning, everyone. There will be some high political theater and hard political work in the week ahead in Washington. On Thursday, the main event. President Obama hosts his televised health care summit with Republican and Democratic leaders, hoping to find common ground there. Good luck on that. And Congress returns from recess this week with a full plate, especially as the Senate takes up a jobs bill.

And joining me now to discuss all this, two men who are known to reach across the aisle and are also on the frontlines of dealing with the struggling economy -- California Governor Arnold Schwarzenegger, Pennsylvania Governor Ed Rendell. They are also leading a bipartisan organization, Building America's Future, dedicated to rebuilding the infrastructure in the country. We'll get to that. Gentlemen, welcome.

SCHWARZENEGGER: Thank you, nice to be here.

RENDELL: Nice to be here.

MORAN: Let's start with the economy. The nation's governors, including of course the two of you, are here in Washington, and the chairman of the Governors Association, Jim Douglas of Vermont, said very starkly, looking at the economy, at the impact on states, budgets, employment the rest, he said the worst probably is yet to come. Do you agree with that, Governor Schwarzenegger?

SCHWARZENEGGER: I believe that the worst is over.

MORAN: The worst is over.

SCHWARZENEGGER: I think that the economy, we see signs of a comeback, but it's very clear that the comeback is not going to be as quick as we've seen in the past. It's slow, and we have (ph) seen in our revenues that there's more than a billion dollars a month coming in more than we anticipated. We've seen that the foreclosure rate has slowed down. We've seen that the house sales have picked up. We've seen people are getting back to work, especially in the green sector. So there's signs all over, but the key thing is not to be overly optimistic, just to be optimistic, and to keep pushing and to take the responsibility that we have as a -- at the state level is to do even thought we have a limited amount of power, but to do everything that we can to do -- to create jobs, jobs, jobs. To get the economy back and to create those jobs, because that is the important thing.

We in California have a 12 percent unemployment rate, and the faster we get the people back to work, the better it is.

MORAN: What's the view from Harrisburg? The worst is yet to come, or the worst is over?

RENDELL: No, I agree with Governor Schwarzenegger. Our economy has done much better. We're at about a 8.8 percent unemployment, I think the lowest of any big state. We have a very diversified economy that sort of has gotten us through this, although 8.8 percent is terrible, obviously. But we've seen real signs of improvement. In the last three months together, we only lost 4,300 jobs, and we were losing 30,000, 40,000 a month a year ago. So things are getting better. Arnold is right.

Our economists predict growth will actually return next year, 3 percent growth, not great. The following year, they predict 4.5 percent growth, which is almost where we were in the beginning of the last decade, in the middle of the last decade.

But I think what Jim Douglas was referring to is the states are going to really have a problem when the stimulus money drops off. It's going to be a problem. But again, stimulus was never meant to be a permanent solution. It was meant to do two things. One, to be a bridge until growth returns, and it has been a very helpful bridge. No ifs, ands and buts about it. We would have had to lay off 50,000 more people had we not had the federal stimulus funds.

And then secondly, President Obama did something (inaudible). A lot of the programs are long-term programs. The green energy jobs, the broadband, the electrical grid jobs. Those jobs, that benefit from the stimulus is going to stretch out over the next five to 10 years. So states are going to have a management problem of their own budget when the stimulus funds drop off, but the economy -- I agree with the governor's estimate -- is coming back slowly, I think surely.

MORAN: Well, the Senate, as I said, is taking up a jobs bill this week, $15 billion. When it started at the White House, it was $200 billion. The House passed a $180 billion version. There was a deal for $85 billion. We're down to $15 billion now, but do you think there needs to be another stimulus, federal stimulus like this? Is $15 billion enough?

SCHWARZENEGGER: Well, I don't think that we need another stimulus as much as what we need is just to do what we have been talking about over the last two years, and that is rebuild America, because that will create jobs. That is why it is so important to think about the infrastructure, because we happen to be at a stage right now where if we don't rebuild our infrastructure, we're going to fall behind economically and we're not going to be the number one nation anymore. I mean, right now, we are the most powerful nation, but it is because we have this great infrastructure that over the last 100 years, we have built, built and built. But in the last few decades, we have stopped maintaining that infrastructure and we have stopped building and expanding that infrastructure, even though there's tremendous demand for that infrastructure.