Dec. 13, 2009 -- ABC'S "THIS WEEK WITH GEORGE STEPHANOPOULOS"
DECEMBER 13, 2009
SPEAKERS: GEORGE STEPHANOPOULOS, HOST
REP. ERIC CANTOR, R-VA.
LAWRENCE H. SUMMERS, DIRECTOR, NATIONAL ECONOMIC COUNCIL
[*] STEPHANOPOULOS: Good morning and welcome to "This Week." The economy front and center.
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PRESIDENT BARACK OBAMA: We are not yet creating jobs at a pace to help all those families who've been swept up in the plunge (ph).
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STEPHANOPOULOS: Jobs, health care, deficits.
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(UNKNOWN): This is the greatest act of generational theft...
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STEPHANOPOULOS: What more must the president do? How will Congress respond?
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(UNKNOWN): This job killing agenda is making it worse.
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STEPHANOPOULOS: Questions this morning for our headliners, the president's top economic adviser, Larry Summers, and the number two Republican in the House, Eric Cantor.
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OBAMA: Clear-eyed, we can understand that there will be war and still strive for peace.
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STEPHANOPOULOS: Is the Nobel speech an Obama doctrine? That and the rest of the week's politics on our roundtable with George Will, Arianna Huffington from the Huffington Post, former White House counselor Ed Gillespie, John Podesta from the Center for American Progress, and April Ryan of American Urban Radio Network.
And as always, "The Sunday Funnies."
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CRAIG FERGUSON, TALK SHOW HOST: Did you see President Obama's Christmas card? Some people are angry that it doesn't contain the word "Christmas," but I think the message is there. The card shows three wise men asking for bailout money. It's very good...
(END VIDEO CLIP) STEPHANOPOULOS: President Obama is just back from Oslo with his Nobel, heading back to Copenhagen for those climate talks, leaving behind health care talks that appear to be stalling in the Senate, and poll numbers that have been falling to their lows of 2009. Our roundtable is standing by to debate all this. They may weigh on Tiger too, but let's check in first with our headliners, Larry Summers, President Obama's top economic adviser, and Congressman Eric Cantor, the House Republican whip. Gentlemen, welcome to both of you.
SUMMERS: Good to be with you.
STEPHANOPOULOS: And Mr. Summers, let me begin with you, and let's start with just the overall economic situation right now, especially on jobs. We saw that drop in unemployment in November, but private economists predict that unemployment is likely to head back up. Mark Zandi sees it peaking at about 10.6 percent next year. Others say it could go up to 11 percent. Is that in line with your forecast?
SUMMERS: George, here is what I know. We were talking about depression, we were talking about the financial system collapsing. Today, everybody agrees that the recession is over, and the question is what the pace of the expansion is going to be.
These things happen in stages. First, GDP goes up. That has happened. Then, hours that are worked by workers who already have jobs go up. That's starting to happen. Then employment goes up. We got very close to that this year, this month, with only 11,000 jobs lost. And then unemployment starts to come down. So these problems weren't made in a month or a year, and they are going to take a substantial time to solve. But what we can take satisfaction from is that we've walked back from the brink. And you know, forget what we say. Most professional forecasters are now looking for a return to job growth by spring.
Now, when job growth starts, more people are going to be looking for work, so it will take a little longer for the unemployment statistics to come down, but make no mistake, we were losing 700,000 a month when President Bush turned the economy over to President Obama. The number last month was 11,000.
STEPHANOPOULOS: Let me pin you down on that, though. You believe the economy is actually going to be creating jobs in the spring.
SUMMERS: That is the judgment of most professional forecasters. That's right, George.
STEPHANOPOULOS: So given that...
SUMMERS: If you look at the employment statistics, they will show employment growth. They were showing losing 700,000 a month. Last month, they showed losing 11,000 jobs. They will bounce from month to month, but I believe that, as do most professional forecasters, that by spring, employment growth will start to be turning positive. STEPHANOPOULOS: So given that, we saw the president allowed (ph) some job creation ideas earlier this week. What is the upper limit on what he will sign into law in terms of new job creation measures early next year? $100 billion?
SUMMERS: The president is going to work with Congress to do what's necessary. George, it's a bit of a Washington thing to put this in terms of price tags. For example, the president is doing a whole set of things, working with other...
STEPHANOPOULOS: But the American people want to...
STEPHANOPOULOS: It's not a Washington thing.
SUMMERS: To promote our exports. That doesn't have a -- that does not have a direct cost. But the president has talked about doing things for infrastructure. It doesn't cost anything to encourage banks, as the president will be doing, to meet their responsibilities and expand the flow of credit to small business.
We're in a very different -- we are in a very special kind of economic situation, and frankly, jobs have to be the top priority, and every bill is going to be a jobs bill going forward. We hope we can find common ground. We emphasize support for small businesses, repairing the nation's infrastructure. These ought to be things that everybody can agree on.
STEPHANOPOULOS: Well, let me just pin you down, though, one more time on that. You did lay out a number of ideas that don't cost money, but extending unemployment costs money. Aid to states and local governments costs more money. Investing in infrastructure costs money. So what is the upper limit on what President Obama will sign?
SUMMERS: The president is going to do what's necessary to respond to this crisis. He's put a figure of $50 billion on the infrastructure support that he proposes. His proposals on unemployment insurance are primarily a continuation of the legislation that the Congress has already passed and that has been put in place. And he recognizes that when we take new steps, we have to do it in the context of a framework that is fiscally responsible. We can't just look in isolation at one measure. We've got to look at the $8 trillion in deficit over the next 10 years that the president inherited, and start making progress with respect to those deficits. That's what the president did in his budget. That's what the health care bill does with the most consequential set of health care reforms that have ever been put forward, and they are now on the brink of passage.
STEPHANOPOULOS: But let me ask you about on health care, because the president has said consistently that he wants health care to bend the cost curve, to bring overall health care costs down. But this week, the administration's chief actuary for Medicare and Medicaid concluded that the Senate health bill would actually increase national health spending by about $234 billion over the next 10 years. Can the president sign legislation that actually increases national health spending?
SUMMERS: We'll see what legislation ultimately emerges. The president is going to sign legislation that helps the budget over the next 10 years, helps the budget more over the 10 years after that, and we're already seeing employers start to respond to the provisions directed at influencing health insurance costs. Over time, when the commission is in place, we will star to see further reforms in Medicare.
And look, George, we've taken an incredibly conservative approach to this. The program includes, for example, significant support for preventive care. That's not being given any credit, but we know that over time, better health habits for all of us can reduce costs. So yes, the legislative process isn't pretty, and it's certainly not pretty on health care. But we will get to a point where we have significant reductions in health care costs.
STEPHANOPOULOS: So bottom line, are you saying that if the administration's own actuaries say that the bill on the president's desk increases health care costs, he will not sign it?
SUMMERS: I am saying that the president's bill will meet what has been the agreed test, that the Congressional Budget Office assesses the bill and concludes that it reduces the budget deficit. To do anything else would be irresponsible. I am also saying that in the view of most experts, the judgments made about imposing a fee on Cadillac policies, the judgment included in the bill with respect to taking politics out of the process of reimbursing health care, the support for prevention contained in the bill goes after some of the fundamental problems in the health care system.
STEPHANOPOULOS: I understand that, but if I heard you correctly, you are saying the bill must reduce the deficit but does not necessarily have to reduce overall health care costs.
SUMMERS: Look, the criterion for passing a bill is what happens to the budget. That's our budget process. I am telling you that we're very confident that this bill will reduce health care costs in whatever form ultimately emerges from the Congress.
STEPHANOPOULOS: OK, let me ask you just a final question. President Obama is calling in the heads of some of the country's biggest banks tomorrow to try to get them to lend more to small businesses and consumers, and that seems to be a big failing so far. You point out that the administration has stabilized some of the programs, have stabilized the financial industry. But we see the banks making money, paying back the TARP funds, but not really increasing lending. What more can President Obama do to encourage that, or is the bully pulpit really his only option?
SUMMERS: Look, he's going to have a serious talk with the bankers. The country did incredible things for the banking industry. Those things had to be done to save the economy, but no major bank would be intact, in a position to pay bonuses, if that extraordinary support had not been provided. The bankers need to recognize that. They need to recognize that they've got obligations to the country after all that's been done for them, and there is a lot more they can do, and President Obama is going to be talking with them about what they can do to support enhanced lending to customers across the country. We were there for them. And the banks need to do everything they can to be sure they're there for customers across this country.
STEPHANOPOULOS: OK. Thank you very much, Mr. Summers. Let me now bring in Congressman Cantor. And you heard Larry Summers there, Congressman Cantor. The president is going to be bringing in the banks for a serious talk tomorrow. What should he say to them?
CANTOR: Well, listen, George, no question that there is a still a deprivation of credit in this country for small businesses. And when the president meets with the bankers, I hope that the discussion centers on what seems to be a real overreaction, if you will, on the part of some auditors in the regulatory arena that are looking at risk taking as something that just shouldn't be done at all. We know in our economy that the prosperity we know has been built on calculated risk. What we've got now is a situation where there are so many performing loans out there that seem to be called by regulators, because we still have a depression in our asset values. And what I'm hopeful that the discussion occurs is about that, is about trying to get some type of transparency on the part of what regulators are asking of our banks, so that we understand and policy makers in Washington and frankly the small businesses that are looking to the banks can understand why it is that when they go to their bank, they're not getting their loan.
STEPHANOPOULOS: And it comes in the wake of the House passage on Friday of this financial reform legislation. Not a single Republican member of Congress voted for that bill. And yesterday, President Obama accused House Republicans of colluding with lobbyists in the financial industry to hurt American consumers. Listen.
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OBAMA: Just this week, Republican leaders in the House summoned more than 100 key lobbyists for the financial industry to a pep rally and urged them to redouble their efforts to block meaningful financial reform. We can't afford to let the same phony arguments and bad habits of Washington kill financial reform and leave American consumers and our economy vulnerable to another meltdown.
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STEPHANOPOULOS: Your response?
CANTOR: Listen, none of us want another meltdown. None of us want the kind of abyss that we were peering into this time last year. There is no question. And we also want to make sure that people got a fair shot in terms of accessing good investments for their future and their retirement. The bill that came to the floor, frankly, was a bill that created a permanent bailout for banks. It put Washington in the seat to determine which banks will fail and which will succeed, and it extended TARP in terms of making it a permanent program. That's not what America wants. We also have a study that we saw that showed that this bill that came to the House floor that got no bipartisan support would increase interest rates almost 1.5 percentage points, and the prediction was that that would kill about a million jobs over the next five years.
Now, like it or not, we are an economy that is built on credit. We've got to get some reason back into the game here. Right now, investors, small business people are staying on the sidelines. They are not expanding. They are not hiring. There is a reason for that. They can't seem to understand where Washington goes next. And what the Republicans believe is, Washington has got to stop its activism and start to get some common sense back into the regulatory mode so that people can once again figure out how to go about making their investments and doing so with some transparency.
STEPHANOPOULOS: We've seen zero Republican votes on this financial reform legislation, one Republican vote in the House on health care, zero on the stimulus. Clearly the Democrats in your view are owning this economy going forward, share any blame if it goes down. If the economy recovers over the next year or two, are you prepared to give Democrats all the credit?
CANTOR: George, when we heard the unemployment numbers come out a few weeks ago and there was a reduction in the number of jobless folks, absolutely, we want to embrace that. But I can tell you, you look to see the record of this administration and the majority in Congress over the last 11 months, we have seen unprecedented spending. The deficit has increased enormously. If you look at the kind of deficit that we've incurred over the last three years that the Democrats have been in control of Congress, 60 percent of the overall deficit from the last 10 years has occurred in that period. And frankly, with the incurrence of that debt, we've seen very little result.
That's why we believe very strongly that we ought to choose another way. Last week, we were at the White House, called there by the president. We presented our no-cost jobs plan, and we said, you know what, none of us like where we are. We all want to get Americans back to work. And there is a way that we can do it by not costing the taxpayers any more. We can do so by finally blowing the whistle on spending and see if we can focus on the kinds of things that American businesses, small and large, are looking for in terms of trying to reestablish some certainty so we can grow this economy again.
STEPHANOPOULOS: OK, Congressman, thanks very much for your time this morning. That debate will continue.
CANTOR: Thank you, George.
STEPHANOPOULOS: Right now, right here on the roundtable, I'm joined by George Will; Ed Gillespie, former counselor to President George W. Bush, former chairman of the Republican National Committee; April Ryan of the American Urban Radio Networks, covers the White House for them. John Podesta, former chief of staff to President Clinton, now president of the Center for American Progress, and Arianna Huffington of the Huffington Post. Welcome to all of you.
And George, let me just begin with you on this debate we just saw. Every single major issue dealing with the economy has been a partisan issue this year. Both sides are basically all in. All in on the economy.
WILL: They all understand that it's job creation is issue No. 1, two, three. But I think, George, there are probably three reasons why we're not creating jobs. First is, why lend? If you're a bank and you're getting money free from the government, you can turn around and invest in government bonds or blue chip equities or risk-free corporate bonds, why lend to small businessmen who have entrepreneurial dreams but are risky? Second, the economy normally has one great engine, consumer spending. It has one fuel for that. It's debt. But the American people right now are deleveraging, and that's probably over time a good thing to shed that.
Third, people disagree as to why the New Deal failed to cure unemployment, but a plausible explanation is uncertainty paralyzed the business sector. That is, they didn't know what the rules were going to be. Today, we have health care, that's an uncertain mandate for the future. You have cap and trade in the offing. You have contracts being shred as in the Chrysler bailout. You have Congress just this week saying, well, maybe judges should be able to rewrite mortgages. The pandemic uncertainty is freezing business activity.
STEPHANOPOULOS: Any way to come back?
PODESTA: Oh, sure. I think that you quoted Mark Zandi at the beginning of the program who was John McCain's top economic adviser. He said that what the president has done, the interventions he's made, has caused 1.1 million jobs from being lost, that unemployment would be over 11 percent. I think what the president needed -- what he did at the beginning of the year, what he needed to do was stabilize the economy. You see it coming back, as Mr. Summers said. You'll see job growth coming this spring. The question is, you know, when that will come, how robust it will be.
The one thing I think I agree with George on is the president, tomorrow, has to find a way to get credit flowing, particularly to small business. I'm not sure he's meeting with the right people. He's meeting with the big bankers. He needs to be meeting with the regional bankers, community bankers, and find ways to get credit flowing to those small businesses (inaudible) engine of growth in the economy.
STEPHANOPOULOS: It is unclear, and Larry Summers didn't quite answer it, it doesn't seem like there's much more -- much beyond the bully pulpit that the president can do right now on this.
HUFFINGTON: There's actually a lot more that he can do. In fact, for Larry Summers to say that the president needs to encourage the bankers to lend is really for the president to give up on his responsibility, which is to be the head of the executive branch. He is not a pundit cajoling and admonishing, which he's been doing constantly. Remember, he's gone to Wall Street. He has spoken to them. He talks to them on the phone. Larry Summers talks to them on the phone. Tim Geithner talks to them on the phone.
George gave you the answer. They're not going to do that. While it's in their interest to continue to borrow money at practically zero interest rate and trade that money and have the safety net of the government.
HUFFINGTON: Paul Volcker gave a very impressive speech in Berlin in the last couple of days, where he basically said, we need to end the safety net for the banks.
While the safety net is there, Goldman-Sachs returned the TARP money, but it still has $21 billion in FDIC guarantees. That has to end. And Larry Summers -- it was so clear from your interview, George, is the wrong man to be heading the president's economic team. His response is so lackadaisical, no sense of urgency. He keeps quoting the same forecasters who predicted, remember, that unemployment would not go beyond 8.5 percent.
STEPHANOPOULOS: Yet -- yet, April, he did say, and I think it was pretty significant, that he agrees with those forecasters (inaudible) job creation beginning this spring.
RYAN: That may be true for mainstream America, but this week, as we've seen, there's a problem in the black community. The overall unemployment rate, right now, in this country, is 10 percent; African- Americans, 15.6 percent.
And the highest numbers right now from November, black teens, 49.4 percent. And you have several issues here in the black community. You've got the Congressional Black Caucus and other leaders saying, yes, there needs to be a targeted approach. Because during the Bush and Clinton years -- you know, in 2001, at the end of 2001, blacks did not return from pre-recession times financially.
STEPHANOPOULOS: So what would that mean? What would the targeted approach entail?
RYAN: A targeted approach means do something (inaudible) for businesses maybe to hire. Not only that; you have issues with the federal government. The federal government itself is falling short of meeting its minority set-aside contracting goals.
And many in the African-American community say that, if that were the case; if they were to fix that problem, they would themselves create jobs.
STEPHANOPOULOS: And we actually saw, Ed Gillespie, a little bit of resistance from the Congressional Black Caucus during these negotiations over the financial reform. But the other tension the administration is facing is how to create these new incentives without blowing a hole, even a bigger hole in the -- in the budget, and increasing the deficit even more. GILLESPIE: Well -- and they're trying to have it both ways. You can't take the $200 billion that's not been spent on the TARP funds and then use it for stimulus, or money that's being paid back that's supposed to go to debt reduction or deficit reduction, and use it on stimulus and say you're also trying to reduce the debt.
The fact is, the reason we're seeing this partisan divide, George, is there's a major philosophical difference. The Democrats think that the answer here is more government invention in the economy than we have already had. Republicans are saying, whoa, we need to slow -- tap on the brakes here, a little bit, and provide some certainty in the marketplace.
Because people are not investing because they don't know what their new taxes are going be; they don't know what their new health care costs are going to be; they don't know what their new energy costs are going to be, as a result of government policy.
STEPHANOPOULOS: Do you see any risk in that strategy of having -- there's such a clear partisan division?
GILLESPIE: Not, not right now. I think it's a time to stand on principle. I think what Eric Cantor laid out, the no-cost, you know, initiative, that says, let's provide some certainty in the marketplace -- and we're trying to create private-sector jobs.
And I think, to your question about, well, what about the credit due versus blame for -- you know, for unemployment is going up, look, that would be the right problem to have as a Republican.
Let me say, if we're creating jobs in this country, I'd rather see job creation than not. That would be -- you know, as a Republican, if the debate is, well, what's the credit; where's it due, that's the right problem to have.
I don't anticipate that. I thought it was interesting that Larry accelerated his anticipation for job creation to begin into the spring. In the past, the White House had been saying the second half of next year, which would be July. Either way, I'm not sure it's going translate, frankly, into the 2010 elections.
HUFFINGTON: But, you know, this is meaningless. Larry Summers accelerating his forecast is so utterly meaningless. I don't even know why we're bringing it up again. Because all the forecasts -- all their forecasts...
(UNKNOWN): Well, what if he's right?
HUFFINGTON: All their forecasts have been completely wrong. I mean, his forecast on foreclosures, remember, they took this very lackadaisical approach to foreclosures. And, right now, one in five mortgages in this country is in default or foreclosure. I mean, this is a major crisis, and his whole stand has been to just say, things will get better; things will get better. PODESTA: We should have had Arianna on with Larry.
I want to come back to Eric Cantor, which is no cost, no jobs, no ideas. I mean, it seems to me that the Republican Party on the Hill has become the party of no.
Maybe I say that it looks, a little bit, from his defense of no regulation that it's become the party of -- of Bush, that we've seen how that movie played out. It ended in the -- in financial meltdown and the great recession.
STEPHANOPOULOS: Is that right, that it's no risk, this strategy?
WILL: I think there is no risk at this point. Because I think the American people understand that the greatest job creation machine in the history of the world is a reasonably lightly taxed and lightly regulated economy.
But one idea, John, that, happily, we're not hearing. When we began this year with...
PODESTA: George Bush had the lowest job creation since World War II, lightly taxed, lightly regulated...
GILLESPIE: Fifty-two months of uninterrupted job creation, the longest in the history of the United States of America.
PODESTA: ... major recession.
STEPHANOPOULOS: What's the one idea?
WILL: The one idea that we seem to have dropped, happily so -- remember the phrase was "shovel-ready"? We were going to create government jobs.
It put me in mind of a great story Milton Friedman used to tell. He went to Asia in the 1960s and was proudly taken by the government to see a public works project. They were building a canal. He was struck everyone was digging the canal with shovels. Friedman says, why no heavy earth-moving equipment?
They said, oh, this is a jobs program. So Friedman says, why don't you give them spoons instead of shovels?
I think we understand, now, the sterility of government trying to create jobs.
STEPHANOPOULOS: We will take -- we will take a break on that. We're going to be back in just a minute, and we're going to answer the question, why were Sarah Palin and Newt Gingrich praising President Obama?
And later, the Sunday funnies.
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SETH MEYERS, "SATURDAY NIGHT LIVE" CAST MEMBER: During the Kennedy Center Honors on Sunday, President Obama presented an award to Bruce Springsteen, saying, "I'm the president, but he's the boss," at which point Springsteen ordered our troops out of Afghanistan.
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OBAMA: I am at the beginning and not the end of my labors on the world stage.
NEWT GINGRICH, FORMER SPEAKER OF THE HOUSE: He clearly understood he had been given the prize prematurely.
OBAMA: There may be times when nations find use of force not only necessary, but morally justified.
PAT BUCHANAN, MSNBC CONTRIBUTOR: It was realistic about what the world is like.
OBAMA: Clear eyed, we can understand that there will be a war and still strive for peace.
SARAH PALIN, FORMER VICE PRESIDENTIAL CANDIDATE: I liked what he said, war is the last thing any American, I believe, wants to have to engage in, but it's necessary.
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STEPHANOPOULOS: President Obama drawing an unlikely ally with his Oslo speech, accepting a Nobel Peace Prize. Let's debate it here on the roundtable. I'm joined again by George Will, Ed Gillespie, April Ryan, John Podesta and Arianna Huffington.
And George, a lot in that speech. The president clearly justifying the use of force but also emphasizing engagement with our enemies in saying that, "When we fight, we must hold ourselves to a higher standard." Does it all add up to an Obama doctrine?
WILL: I don't think so. St. Thomas Aquinas was late to the game talking about just wars so people are arguing that there is such a thing as a just war for a long time. I thought the most interesting part was his acceptance of the fact that ethnic and sectarian fighting is the new cause of turmoil in the war. This marks the end of what Pat Moynahan used to call the liberal expectancy, that was the faith that once science and progress and education had reached a certain level, that we had reached presumably in the 20th century, that religion and ethnicity as driving forces would lose their saliency. In fact, they're now more virulent than ever.
STEPHANOPOULOS: And rejection of utopianism in all its forms.
HUFFINGTON: Well this is good and of course I don't think there are many people who would argue there are no reasons for wars. I mean, after all, this is the peace prize, it's not the pacifist prize, so I didn't quite understand all that big defense of the necessary wars.
And for me, the main problem is the same problem I had with his West Point speech which is when he said that my job is to protect the American people from threat. Of course, everybody would agree with that. But he has not defined what the threat coming from Afghanistan are. And he did not define the strengths in the West Point speech. He did not define them at any point. And that's really at the moment, the main problem with his credibility because where are the threats coming from? The Taliban? The 100 al Qaeda left in Afghanistan?
And remember in 2002, he gave this defining speech that in many ways is responsible for his being president, which was against the war in Iraq, when he said, "I'm not against all wars, I'm against a dumb war." And right now, Afghanistan is the gold standard of a dumb war, immoral and unnecessary.
PODESTA: Well, I think that I find it ironic that the conservatives all embraced the speech. It seemed to be a repudiation of conservatism. They made the argument that because America was exceptional, the rules didn't apply to us. This was really rooted, I think, in post World War II. This sounded like FDR to me, that he was saying that constraining our power, following the rules of the road, not torturing people, applying the Geneva Conventions was the source of American exceptionalism, that we led the world towards that.
With respect to Arianna's point about what the threat is, I think he was fairly clear that in the context of both the speeches that he gave, that we need to go after the people that attacked us. And I think that they've done that. They've done that. You could argue about whether this is the right strategy to do that. They're effectively using predators in Pakistan, they're doing more in Pakistan over the last 10 months.
HUFFINGTON: You now sound like George Bush, you know that the people who -- the people who attacked us are not...
PODESTA: That's the first time I've been accused of that.
HUFFINGTON: The idea that the people who attacked us are in Afghanistan.
PODESTA: Are in Pakistan.
HUFFINGTON: But they are going to Pakistan.
PODESTA: Well, I would beg to differ.
HUFFINGTON: We're not sending 30,000 more troops to Pakistan. PODESTA: I said you could argue about the tactics. But I would beg to differ that we're not going Pakistan.
HUFFINGTON: The announcement he made --
STEPHANOPOULOS: There was a drone strike just this week which took out the number four or five member of al Qaeda.
HUFFINGTON: Right, but that's not what he announced. The collection is in Afghanistan.
STEPHANOPOULOS: And this gets to an important point, April, and you've been covering the White House all this year. It turns out that in this last 11.5 months, President Obama has launched more drone strikes in Pakistan than in the entire eight years under President Bush.
RYAN: Well interestingly enough, this president wants to show this country and the world that he is actively trying to prevent any type of attack on the homeland.
And yes, drone attacks are something different from actually sending troops because number one, that territory, that land is something that is not traditional battlegrounds. It's mountainous. It's very hard to get through. And drone attacks I guess are better to do than doing troop movements where lives would be lost.
But going back to the speech and getting back on that, as well, I think the president in the speech, he was trying to target Americans to help one, bring up his poll numbers because a lot of people are upset with the fact that this war is not going to produce a military win, i.e., drone attacks.
Also, you have issues where this president has to make the case for war again to bring peace. But at the same time, as the head of state, this president has to say, war is always an option for peace. So it's not like Dr. King talking phone violence. He has to talk about war because peace comes with it.
STEPHANOPOULOS: And that was the irony of the speech. Ed, some people did look at this, some conservatives and say they did see President Obama basically adopting the policies of President Bush. Is that how you saw it?
GILLESPIE: I didn't. I thought in some ways, the sense of moral clarity was positive and I appreciated that. I was less enthralled by it frankly than many of my fellow conservatives. I tend agree with John, not that he was right about what he said, and I will sound more like George Bush, I suspect than you, but that he was implying that our past actions had been immoral. And I don't think -- one, I think it's factually wrong, and two, I don't think it was right to do on the world stage like that. So I'm not sure that it will withstand the test of time as people think as a great speech.
STEPHANOPOULOS: Let me bring the debate back home because a lot happened on health care while the president was away as well. Senator Harry Reid, the Democratic leader, came out Tuesday night, seemed to announce that there was an agreement, an emerging agreement about the 60 Democratic senators that would involve dropping the public option, replacing it with allowing most Americans, Americans who don't have health insurance from the employers to buy into something like the members of Congress plan and also a Medicare buy in for people 55 to 64. But by the end of the week, there was an awful lot of confusion on the Senate floor.
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SEN. JOHN MCCAIN, R-ARIZ.: Right now, no member on this side has any idea as to the specifics of the proposal that the majority leader, I understand has sent to OMB for some kind of scoring.
SEN. RICHARD J. DURBIN, D-ILL: I would say to the senator from Arizona that I'm in the dark almost as much as he is. And I'm in the leadership.
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STEPHANOPOULOS: The number two Democrat in the Senate, George Will?
WILL: Well, the public option this week receded and was replaced by a public option on steroids, which is the buy-in on the part of 34 million Americans between age 55 and 64. Only 3 million, well about 4 million are uninsured. There are three basic political numbers that we ought to look at from this week.
CNN poll, 61 percent oppose the plan, 36 percent favor it. Second, today there are more Independents in America than there are members of either party. And the Independents are more ho hostile to Congress. Their approval rating of Congress is 14 percent below the Republicans, which is 17 percent. Third, there was a state Senate race in Kentucky this week. They nationalized it. It was in a heavily Democratic district.
WILL: The Republican was heavily outspent. He'd made this a referendum on Pelosi, Reid, and health care. The Republican won by 12 percent.
STEPHANOPOULOS: So John Podesta, can the Democratic moderates especially in the Senate, the Mary Landrieus, Blanche Lincolns, Ben Nelsons of the world, hang together in the face of that kind of opposition in the public?
PODESTA: I think so. Because I think we're at an historic moment where we're going to expand coverage, bring down costs, end insurance abuses. And I think there's beginning to form a consensus. We're kind of on the five-yard line, I guess. We're probably not on the one-yard line. But we'll see what happens with the CBO score.
I think the other thing that happened this week was that the freshmen senators, many of whom are moderates themselves, have put together a package to further restrain costs, produce more delivery reform. That amendment was endorsed by the Business Roundtable and the National Association of Manufacturers, people who have to pay the cost of health insurance on the employer side.
So I think that, you know, this is a process of moving the bill forward. I think Reid will be able to get to 60. I'm still hopeful that Olympia Snowe will vote for the bill, but you know...
STEPHANOPOULOS: She was pretty tough on the Medicare buy-in.
PODESTA: She was.
STEPHANOPOULOS: But Arianna, I want to ask you in particular. A lot of progressives all year long have been fighting for this public option. I have to say, I confess I haven't understood how it became the holy grail, especially since by the time it got through the process, it was a relatively weak option that wouldn't serve that many Americans.
For progressives, is the combination of being able to buy into a federal plan and a Medicare buy-in, as George Will said, the public option on steroids?
HUFFINGTON: Well, of course. You know, the name is not what matters. What matters is having real competition for the health care insurance industry. That's what's been missing. Without that competition, which the public option or Medicare on steroids can provide, there's really no cost containment, and none of the things that we're hoping this health care bill will achieve will actually be achieved.
The main thing, really, out of this whole process has been to demonstrate how broken our system is. I mean, it's really stunning. Tom Friedman said it best when he said we have these big problems and we cannot any longer produce optimal solutions for these big problems, only suboptimal solutions. So you kind of go through all these amendments, and it's just a series of suboptimal solutions. And the process of it has dragged on, has dramatically reduced the president's poll numbers...
STEPHANOPOULOS: Yet, April, an article of faith inside the White House is that passing health care will solve all political problems. They really believe that will have Americans look at the president in an entirely new way.
RYAN: It goes back to what you said about being the holy grail. This was something that was debated during the campaign. This was something that he got the American public to believe in, and ultimately got into the White House for it. But what happens is it has been the pinnacle, if this president can get this through Congress, he ultimately can help shape 2010.
And -- but the issue is...
RYAN: No, no, no no, but let me -- but the problem is, the original mandate is not there, covering all Americans. Yes, it covers more Americans than what they have now, but that was the original mandate. And the issue is competition. Yes, that's there, but covering all Americans is a problem.
GILLESPIE: And this faith in the White House, George, is increasingly being limited to the White House and I think less to Senate and House Democrats. And I think the White House, they are seeing what they believe, that this is good to get this done. And I think Democrats on the Hill increasingly believe in what they see, which is this polling data that shows if they do this, if they jam this health care through with Democrat-only votes in the face of overwhelming public opposition, they're going to lose their majority in the House. I think that's a real possibility. And they're going to lose probably even their 60-vote margin -- definitely lose their 60-vote margin, but maybe even get down to around 50 votes in the Senate.
PODESTA: The one thing they're certain of is failure on the substance will result in failure politically.
GILLESPIE: For the first time, I believe they're in a place where they may not be able to get there from here.
RYAN: It's not about a definition of a win just to win... (CROSSTALK)
HUFFINGTON: But 2010 is not about health care. Again, 2010 is going to be about the bailout and jobs. That's going to be the issue...
HUFFINGTON: ... bailout is overwhelming. Losing the independents, the numbers that George mentioned are incredibly significant. Because remember, Barack Obama is president because he brought in unlikely voters. He expanded the electorate. 71 percent of new voters voted for Obama. These voters are getting increasingly disillusioned with the fact that there has been no fundamental change. That is the main problem the White House needs to address.
STEPHANOPOULOS: But does passing health care solve it? And then to pick up on Ed's point, it does seem like every time the Senate Democrats get close and seem to have this psychology of victory, one member -- whether it's Ben Nelson, Joe Lieberman, even Jim Webb, seem to say, wait a second, we're not there yet.
WILL: I think Republicans would prefer to stop the health care bill, but they think that if it passes 60-40, that means every single Democrat is the one responsible for passing a bill the country does not want.
STEPHANOPOULOS: Meanwhile, Tiger Woods.
STEPHANOPOULOS: Just a couple of minutes left, and he announces on Friday...
STEPHANOPOULOS: ... announces Friday indefinite, indefinite time off from the PGA Tour. The big question now, will his sponsors, like Nike, stand by him.
(BEGIN VIDEO CLIP)
(UNKNOWN): I'm Tiger Woods.
(UNKNOWN): I'm Tiger Woods.
(UNKNOWN): I'm Tiger Woods.
(UNKNOWN): I'm Tiger Woods.
(UNKNOWN): I'm Tiger Woods.
(UNKNOWN): I'm Tiger Woods.
(UNKNOWN): I'm Tiger Woods.
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STEPHANOPOULOS: Boy, it is almost impossible to look at that ad anymore, almost impossible to see how Nike can keep that up for very long. Already, April Ryan, we've seen Gillette start to question their sponsorship, Accenture, AT&T, and we haven't seen -- I can't remember the last time we saw public meltdown of a public figure like this.
RYAN: It happens periodically. And unfortunately, we're seeing a meltdown of people turn around and watch YouTube, reading the Huffington Post, and finding out what's going on, the latest.
It's tabloidism. I mean, we're a society of reality TV, we read the tabloids, we hear the things, and unfortunately, we are drawn in. But at the same time, you have to remember, Tiger Woods is human, but at the same time, he is this -- was almost a perfect American.
STEPHANOPOULOS: But he's also got an entire industry, George Will, on his back.
WILL: And he can put it back on his back for this reason. He's not just a celebrity of the sort Daniel Boorstein (ph) talked about, a celebrity being well known for their well knowness. That's Paris Hilton. We tend to forget, Tiger Woods is a really good golfer, and people are going to pay to see him do that, and people are going to forgive him and they are going to quit looking at him as an exemplar.
Remember, no telling how many more home runs Babe Ruth would have hit if he had gone to bed a little earlier and a little more often with Mrs. Ruth.
STEPHANOPOULOS: ... victory for health care that solves the White House's problems is coming back and winning the Masters in April, do it for Tiger?
GILLESPIE: Maybe next April. I think he would probably benefit from going underground for a while. You know, tending to his home situation, and then coming -- if I were he, I would stay low, and then surface after a year.
PODESTA: I think those endorsements are going to come down. You'll see him off the screen. He's got to, really, I think over the course of the next year, and then he can, if -- you know, if his game's back, he can come back. And you've seen people...
STEPHANOPOULOS: But there's nothing he can say now that can begin to fix this.
PODESTA: Only that I'm in therapy.
HUFFINGTON: It also depends on how many more mistresses are going to appear. Remember...
STEPHANOPOULOS: Haven't we passed critical mass at this point?
HUFFINGTON: He has won 14 majors. And right now, there are about 11 mistresses. And any minute now, they're going to overtake the majors.
RYAN: But you know what, one thing about Tiger Woods and golf, the golf world needs Tiger and Tiger needs golf. And he brought so many people, so many -- I mean, young ethnic kids into the game of golf. I mean, years ago, you would hear these kids saying, oh, I don't play that, that's not my sport. And so many kids thought everything was open to them once Tiger did it.
GILLESPIE: I was just going to say, one of the things about him, there's jokes and everything obviously all over the Internet, but you know, it's really -- what strikes me about it is it's remarkably sad. I mean, this is a guy who is the best golfer in the world, one of the most...
GILLESPIE: Ever, $1 billion, married to a swimsuit model. I mean, you're watching this, you think this is -- this is like, you know, this guy has got everything that he could possibly want, and clearly unfulfilled. You know, and there's just something remarkably sad. And in this season, you know, a good time for people to count their blessings in terms of you don't need a billion dollars and you know, to bring happiness.
HUFFINGTON: A lot of teachable moments. Both serious ones, like the one that Ed brought up, and not so serious, about any man who wants to cheat on his wife, remember, texting is the new lipstick on the collar. And don't date men -- don't date women, as Maureen Dowd said, who have eight by 10 glasses.
STEPHANOPOULOS: Arianna's rules. We're going to have to end -- this roundtable is going to continue in the green room.