'This Week' Transcript: Former President Bill Clinton

BRAZILE: A union official. And, look, we know that the level of vitriol is not at an all-time high and it's not that people are upset that, you know, some folks are angry and that they formed a movement that has energized the conservative base of the Republican Party.

What people are worried about is that this movement seemed to have a particular target, their demonizing of individuals that they disagree with. It's all right to disagree with people. I disagree with George Will all the time. In fact, I disagree with myself sometimes.

But the truth is, is that we can disagree without demonizing people. And then, of course, some of -- there's people worried that the level of incivility now is growing to a point where you can't even have an honest debate about tough issues. TAPPER: Al, President Clinton -- former President Clinton really has so much to say and really seems to be -- to miss being in the thick of it.

HUNT: Jake, we forget how good he is, too. I mean, he really is. He gave a speech at the Gridiron dinner several weeks ago, and he began by noting that it was the anniversary of the 1942 speech of General Douglas MacArthur when he said, "I shall return." And I think that was Clinton's message that night.

Bill Clinton had a very rough 2008. His standing was badly hurt with some of the things he said in the campaign, some of the way he behaved. He was bruised after it. He kept a very low profile.

I think he's had a very good last year. I think he is slowly coming back. Many people thought he'd embarrass his wife. He certainly has not done that. He's been very actively and admirably involved in Haiti, involved in North Korea.

There are more Democratic politicians I know now who, in what's going to be a tough year, are turning to Bill Clinton for advice.

There's one place, however, that doesn't turn to Bill Clinton very much for advice, and that is the Obama White House. The tensions between the Obama top people and the Clinton top people remain very raw, Jake.

TAPPER: Very interesting. President Clinton talked a bit in our interview about financial regulatory reform, and I'd like to switch to that topic right now, because President Obama is really making a big push. George, one of the issues with financial regulatory reform is whether or not the reforms create or keep a moral hazard.

Explain exactly, what is a moral hazard?

WILL: A moral hazard exists when the incentives are for perverse behavior. And the question is, does the attempt to deal with too big to fail, which some people think if it's an institution's too big to fail, it's too big to exist -- that's another argument. The fact is, there are huge financial institutions that are too big to fail, have been since the Reagan administration in 1984 bailed out the Continental Illinois bank.

So the question under the legislation being considered is, the resolution authority, which is a fancy way of saying how do you liquidate these things or...

TAPPER: Can the government come in...

WILL: That's right.

TAPPER: ... and sell it off?

WILL: Unless the creditors and shareholders are exposed to severe, terrifying, deterrent losses, then you have moral hazard, because they will not be careful with the risks they take. And the question that some Republicans have is, is there a safety net that will encourage risk-taking?

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