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

September 26, 2010 — -- 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 themiddle-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.