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Meet the Press transcript for July 18, 2010

Transcript of the July 18, 2010 broadcast of NBC's Meet the Press, featuring John Cornyn, Bob Menendez, Pete Sessions and Chris Van Hollen.

MR.  DAVID GREGORY:  This Sunday:  The balance of power in Washington and the political shockwaves from news made right here last Sunday when the White House conceded Democrats could indeed lose control of the House. How big of an anti-incumbent wave could be headed Washington's way this November?  This morning the debate continues over the economy, the president's performance, and the future of the Republican Party.  Plus, a look at some of the top races to watch during this summer of fierce campaigning.  With us, four men charged with leading their party to power in Congress, chairman of the National Republican Senatorial Committee, Senator John Cornyn; chairman of the Democratic Senatorial Campaign Committee, Senator Bob Menendez; chairman of the National Republican Congressional Committee, Representative Pete Sessions; and chairman of the Democratic Congressional Campaign Committee, Representative Chris Van Hollen.

Finally, a look back in our MEET THE PRESS MINUTE at campaign promises and predictions during a tumultuous year for the GOP in the wake of Watergate and a troubled economy.

Announcer:  From NBC News in Washington, MEET THE PRESS with David Gregory.

MR. GREGORY:  Good morning.

MR. DAVID GREGORY:  With the midterm congressional campaign already in full swing, the president lashed out at Republicans during his weekly radio address, accusing the GOP of, "filibustering the nation's economic recovery." But the president and his party are not simply fending off a high unemployment rate and sinking poll numbers, they are desperately trying to reframe the debate ahead of what could be a grim fall for the party in power.

Just how grim?  The president's spokesman, Robert Gibbs, upset his party's efforts to manage expectations when, right here last Sunday, he conceded the House Democratic majority is in jeopardy.


MR. ROBERT GIBBS:  I, I think there's no doubt there are enough seats in play that could cause Republicans to gain control.  There's no doubt about that.

(End videotape)

MR. GREGORY:  The response was furious from the House speaker, though understated for public consumption.


REP. NANCY PELOSI (D-CA):  I think the comment was unfortunate.

(End videotape)

MR. GREGORY:  Privately, Democrats seethed, complaining the president and his team are unreliable allies in such a tough anti-Washington year. Republicans pounced.


REP. JOHN BOEHNER (R-OH):  With all the trouble that House Democrats are in right now, it was really only a matter of time before the gloves came off.  I just didn't know that the targets would be each other.

(End videotape)

MR. GREGORY:  The Cook Political Report identifies 64 House seats now held by Democrats that could fall to a Republican.  The GOP needs 39 to retake the majority.  How does that compare to recent wave elections?  In 2006, Democrats tapped into anti-war, anti-Bush sentiment to capture 30 seats and the majority.  And back in 1994, the Newt Gingrich-led GOP wrote its Contract With America to a House majority, gaining 52 seats. Just two years ago, President Obama swept into Washington on a "change" message, reviving hopes of a Democratic political realignment.  Two years later, why is the House up for grabs again?


MR. CHARLIE COOK:  It's a combination of the overexposure in terms of Democratic seats with a horrible economy and people just sort of very unhappy with Washington.  And, and they're lashing out.  And if Republicans were in power under these circumstances, they would be
the--they'd be the victims of this, too.  You know, this is a very, very ugly political environment.

(End videotape)

MR. GREGORY:  Republicans will campaign this fall, saying, "We are not the free-spending Democrats." Democrats will urge voters to consider the election a choice, not a referendum on President Obama.


PRES. BARACK OBAMA:  This is going to be a choice between the policies that got us into this mess and my policies that are getting us out of this mess.

(End videotape)

MR. GREGORY:  And that is where we will start.  I'm joined here now in the very first joint interview by the heads of the House and the Senate Campaign Committees.  For the Senate, Democrat Robert Menendez and Republican John Cornyn.  For the House, Democrat Chris Van Hollen and Republican Pete Sessions.

Welcome to all of you for what I'm sure will be a spirited discussion about this balance of power in Washington.

Congressman Sessions, respond to the president.  As he told Chuck Todd, our chief White House correspondent, this week, "It's going to be a choice this fall between the policies that got us into this mess and my policies which are getting us out of this mess." Do you think that's how the public's going to see it?

REP. PETE SESSIONS (R-TX):  I think the, the public sees this as a long-term debt issue of big government, more spending.  The president and the House, at least, are two-tenths through a big government agenda.  And the bottom line is, is that people back home see it where government is doing quite well and the free enterprise system and jobs back home are not doing so well.  I think change is in the air.

MR. GREGORY:  But there is an argument from the president and from Democrats that you got to consider the choice here, there's the president's policies or there's a reminder of the Bush Republican era. Is that a scare tactic?

REP. SESSIONS:  Yeah, of course it is, because Speaker Pelosi has been in charge for four years and denied the president the ability to continue doing what was successful in this country and that is making the free enterprise system not only more powerful but competitive with the world. Today it's about empowering government, and that is a mistake.

MR. GREGORY:  Senator Menendez, you heard Charlie Cook talk about this incredibly ugly political atmosphere right now.  Why is that the case?

SEN. BOB MENENDEZ (D-NJ):  Well, look, there's a lot of people hurting in this country, and we realize that, and that's why we've been working to try to change the economy that we inherited.  You know, but this will be a choice election because I know my Republican colleagues would like to have everybody forget that their candidates are on the ballot, but their candidates will be on the ballot.  And it's not just talking about President Bush, it's the policies that they espouse that are in essence Bush's policies.  Those led us to a 72 percent  increase in the debt from $5.7 trillion to $9.8 trillion when Bush left.  It led us to a massive
elimination of the surplus that Bill Clinton gave George Bush, and he had a $1.5 trillion deficit when he left office.  And so our Republican colleagues, who had their hands on the wheel and drove the car off the cliff into the Grand Canyon and the huge crater, don't want to take
responsibility.  It's time that they did.

MR. GREGORY:  But you--Congressman, if this is the reality, apparently the public is not yet keyed into it because here's where we stand, if you look at The Washington Post/ABC News poll, "If elections were held today, who would you vote for, a Democrat or a Republican candidate in your congressional district?" And you see the, the results there, the
Republicans have an edge, 47 to 46 among independent voters, and this is something we'll talk about repeatedly this morning, a certain edge going to Republicans, 47 to 40.  How serious is this climate here against the Democrats?

REP. CHRIS VAN HOLLEN (D-MD):  Well, David, if you look at that Washington Post/ABC poll, the most, I think, interesting fact that came out of it, and the one that was right on the front page, was the fact that the American people have a lot less confidence in Republicans in
Congress than they do in Democrats in Congress, and that's not surprising.  It's pretty fresh in their memory exactly what those Republican policies did to the economy.  After all, during the whole eight years of the Bush administration, we actually lost over 600,000 private sector jobs.  We're now seeing positive job growth.  And the good news, I think, for the American people is our Republican colleagues are reminding people every day that they would adopt the same policies they had before.  John Boehner, the Republican leader, just this week said
that he's going to move to repeal the Wall Street reform bill.  Now, Wall Street lobbyists have been working very hard to try and defeat that Wall Street reform bill, and what he's saying is, "Just wait, if I have the opportunity, I'm going to take care of it for you." So it's that kind of
thing that's going to make it clear to the, the American people what kind of choice they have.

MR. GREGORY:  Senator?

SEN. JOHN CORNYN (R-TX):  Well, I'm wondering when our Democratic friends are going to take responsibility for the policies that they've forced down the throat of the American people, which have proven to be very unpopular, including the healthcare bill that the majority of the
population think we ought to repeal and replace with something that will actually bend the cost curve down.  The president's approval rating's about 38 percent among independent voters, and what we're seeing are independent voters who are fleeing the Democrats coming to Republicans because they believe that checks and balances are absolutely essential in 2010 because they want to restrain this, this unprecedented spending binge, the unsustainable debt and the government takeovers.  And I think they see Republicans as the best bet to provide those checks and balances.

MR. GREGORY:  Well, and we'll get into some of the issues.  I want to go back to Congressman Van Hollen on some of the fallout from the news that was made right here last Sunday, Robert Gibbs stating what a lot of people in politics thought was obvious, which is that Democrats are in trouble in the House, they could indeed lose majority status in the House.  But the reaction among Democrats to a member of the administration, a, a top White House adviser actually saying that publicly was not very strong.  Bill Pascrell from New Jersey, as reported in The Hill newspaper on Thursday, said the following, "If the administration is trying to tell us `stay away from us with an arm's length,' they did a good job.  We don't need a wake-up call.  The White
House needs a wake-up call on the politics of these issues." What impact did Gibbs' statement have, particularly in some of these toss-up districts?  Do you think it sent the wrong message?

REP. VAN HOLLEN:  Well, this is the distinction between a mathematical possibility and a probability.  We have said all along this is going to be a very tough political election for all the reasons people have said. But we've also said at the end of the day we're confident we're going to retain a majority in the House.  The Democrats are on the same page now.
The Democratic leadership in the House had a great meeting with the president, it was positive, we talked about the agenda for the remainder of the year, and we emphasized the fact that voters are going to have this choice that we're talking about here this morning because the Republicans want to get away, essentially, with carping and whining about
everything here without telling the American people what they will do. We're now beginning to hear a little bit about what they would do, and that choice is...

MR. GREGORY:  But, but go back to the Democrats, Congressman, because there was a real sense among House Democrats that I've spoken to, over a period of time, frustration with the White House.  I mean, here House Democrats took tough votes on health care, on climate change, on the stimulus, and they felt like, you know, this White House is not made up
of very strong allies.  This was really the icing on the cake, wasn't it?

REP. VAN HOLLEN:  Well, we know the White House is a strong ally for this reason:  The fact of the matter is the president and the White House know that they need a strong majority in the House and in the Senate in order to complete their agenda, to keep working on that agenda.  They also know that the day after the elections it will be interpreted as a referendum
on the president's policies in the press, whether they like it or not. So we are on the same page.

Now, David, there is some frustration.  The frustration is there are lots of important bills to push for jobs that are sitting over in the Senate. But it's not the fault of the Democratic leadership in the Senate.  I mean, frankly, you know, John Cornyn and his allies have been trying to block a whole lot of very important jobs measures.  We in fact sent a piece of legislation over very recently that would remove these perverse tax incentives to ship American jobs overseas, that give American corporations a bonus if they ship American jobs overseas.  Pete and his colleagues voted against getting rid of that loophole.  It's not in the
Senate.  I hope that the Senate Republicans will join with the Senat Democrats and pass that kind of measure. So the frustration is that, while we've made important progress, we still want to keep working and moving forward on the economy.  And there is a lot of important jobs
legislation bottled up in the Senate.

MR. GREGORY:  How, how--Senator Cornyn, to what extent do you see this as a repeat, potentially, of 1994?  It's interesting, if you remember, Newt Gingrich and the Contract With America sweeping into majority status, winning 52 seats.  And, at the time, Adam Clymer wrote this in The New York Times, which caught my attention:  "Republicans based much of their
push for major gains on the notion that the Democrats, who in '92 won control of the White House while retaining the Senate and the House, had since disappointed the voters.  That made it possible, Gingrich said, to put out `one clear message from Washington' which could not be done in the '80s, when control of the White House and Congress was divided between the parties." I mean here, just like 1994, Republicans have made a choice:  unity of opposition to everything the president has put forward.

SEN. CORNYN:  Well, I think every election's different, David, and this election'll be different from 1994.  No matter what the actual count is, it will be a different election.  But I want to say to my friend Chris, the--you know, the problem is the Democrats have been able to pass almost everything on the president's agenda, and they've been doing it with a "my way or the highway" approach without reaching out and seeking compromise and Republican support.  And, as a result, the Business Roundtable, one of the big allies of the--of this White House, has come out and given a list of job-killing policies that have been passed, which make capital, make investment, make job creators sit on the sidelines. And if there's one area where this administration has failed miserably, it's been in creating an environment where job creators will make those investments and create jobs and grow the economy.  And that's what I think the American people are reacting to, because people without a job can't pay their mortgage and they're losing their home. And we've seen everything on the Democrat agenda except for the number one thing on the mind of most Americans.  That is jobs, "How can I keep my home? How can we restrain the growth of government when runaway spending and unsustainable debt?"

MR. GREGORY:  Senator Menendez, if you look at where the president stands, these are policy issues that the senator is bringing up.  Here's the president's approval rating, it's upside down, he's at 48 percent disapproval. The Washington Post poll from this week that we referenced
shows that six in 10 Americans lack faith in the president.  And here's how the Post reported it:  "Public confidence in Obama has hit a new low, according to the latest poll from The Washington Post-ABC.  Four months before midterm elections that will define the second half of his term, nearly six in 10 voters say they lack faith in the president to make the
right decisions for the country, and a clear majority once again disapprove of how he's dealing with the economy." Is November a referendum on Obama?

SEN. MENENDEZ:  No, November's a--is a, a choice election.  And the reality is, is I listen to, to John talk about the agenda in the Senate, the Republicans have been the job killers in the Senate.  In essence, they have used the filibuster in an unprecedented way in the nation's
history to stop progress on everything that we have tried to do.  So, as we're trying to help the private sector grow jobs by giving them tax incentives, net operating loss, bonus depreciation, giving them incentives to small businesses to hire people, they have said no, no, no, no.  Now, the problem is, is that in this choice election it will be far less than the president.  It will be about whether or not we go back to the Bush economic policies that they espouse, the policies that John Kyl, the number two Republican in the Senate, said...

MR. GREGORY:  But, but you just heard, but, but you just heard your, your, your colleague from the Congress, from the House say, "Look, it's going to be perceived as a referendum on Obama and his policies." How does it not?

SEN. MENENDEZ:  Well, no.  I think what, what Chris said, at the end of the day the results, regardless of what they are...


SEN. MENENDEZ:  ...positive or negative, may be viewed that way.  But look, when John Kyl says that you don't have to pay for $680 billion of tax cuts whatsoever, just add it onto the debt, but you can't even take care of $30 billion to have people who are unemployed in this country get through the emergency of the moment, you know, it's a big difference. And when we look at jobs, the reality is we lost 2.9 million jobs in the first six months of the president's time that he inherited from Bush.  We created 860,000 jobs in the first six months of this year.  That's a 3.7 million [unintelligible].

MR. GREGORY:  Right.  But, Congressman Van Hollen, here's the reality. In Newsweek, Howard Fineman in his column reports it out in terms of what Democrats are facing as a result of the president's policies.  We'll put it on the screen.  "Obama won over [male independent] voters in 2008, and they may be all that stands between Democrats and catastrophe this fall. ...  The Democrats' support among that group has fallen to as low as 35 percent in some polls.  And the reasons are clear.  They do not believe that Obama's actions have produced results - and for these practical voters, nothing else matters. The $787 billion stimulus bill is widely regarded as an expensive, unfocused dud.  ...  Healthcare reform remains, for most voters, a 2,000-page, impenetrable, and largely irrelevant mystery.  The BP oil spill has hurt Obama's ability to fend off GOP charges that he's ineffective as a leader. Democrats are hoping to win back this group with one strategy:  attacking the Republicans, individually and as a group.  ...  The plan is not to blame George W. Bush ...  but to warn that a return to the GOP brand ...  would be a
disaster." And we're hearing all this this morning.

REP. VAN HOLLEN:  Well, what you're, what you're hearing is--as, as Bob said, look, we know that we have a long way to go on the economy.  People are still hurting, that's absolutely clear.  But we also know what the American people know, which is the day George Bush lost--left office, we were losing 700,000 jobs a month.  And during the full eight years of the Bush administration we lost private sector jobs.  We are now beginning to climb out.  And what we are saying is yes, let's focus on the policies, because why in the world would we want to go back to the same economic agenda that created that mess, that, that lost jobs for eight years?  And I think the challenge that our colleagues have here, Pete and John, is to
say to the American people, how do you expect to do the same thing and get a different result?  I mean, that, that's Einstein's definition of insanity, right?

MR. GREGORY:  But, Congressman, is that fair?  Is that what, is that what Republicans stand for today?  Is it the party of George Bush?  Is it the economic approach of George Bush?

REP. SESSIONS:  First of all, it's not truthful.  People had jobs when Republicans were, not only in charge, but George Bush was there.  We doubled the size of the economy over 12 years.  We did things that would empower the free enterprise system.  Here's what the facts of the case are.  There will be candidates who will be on the ballot back home facing the Democrats who have voted in the 90 percent realm with Nancy Pelosi to raise taxes and bigger government, and a healthcare plan which we cannot sustain and will quite likely bankrupt, not only states, but business also.  These candidates from top to bottom, whether we talk about Rick Berg and Kristi Noem, all the way down to David Rivera in Florida, are saying we must live within our own means, we cannot spend what we don't have, and we must be able to sustain what we're doing.  That's why we're going to win.

MR. GREGORY:  Well, so what is the message your candidates are going to send about President Obama?  What has he done with government, to government?

REP. SESSIONS:  Well, well, first of all, they're going to run against the, the person who's on the ballot with them.  And that person has voted for more spending and big taxes and more of an agenda that's about empowering Washington, D.C., not back home.  They are going to say we should read the bills before we vote on them, we should make sure we live within our means, and, perhaps most of all, get behind an agenda where the American people are, which began for us one year ago in August when Republicans would attend town hall meetings and hear about health care.


REP. SESSIONS:  Democrats fled.

REP. VAN HOLLEN:  But, but, but, David, I mean, you heard the very beginning of the answer to your question, a defense of the George Bush economy and the George Bush years.  And I don't think the American people see it that way, because they know we had a meltdown in the financial sector, they know we lost jobs.  And so when they hear the Republican
leader John Boehner say he wants to repeal the Wall Street reform bill, which is an effort to make sure that the American people and the whole economy are not again held hostage by bad bets on Wall Street, they recognize that they do, in fact, want to go back to those policies.  They have, they have Joe Barton, the head of their energy committee--who, who would be the head of the energy committee, apologizing to BP.  It's a, it's a big oil agenda.  They've got, they've got the, the folks who oppose the legislation to try and remove the tax loopholes that help export U.S. jobs overseas.  We want to shut those loopholes.  They, they hear all this and they see that what they're going to get if you had, you know, Republicans in charge, is that economic agenda.  And they, they can't answer that basic question:  What, what are you going to get that's different?

MR. GREGORY:  Well, Senator, what, what distinguish the Republican Party of today from the Republican Party under President Bush's rule with regard to spending, which is where it got out of control under Republican rule, that now conservatives are so upset about.

SEN. CORNYN:  Well, let's look at a few facts.  I, I, thank you for the opportunity because I wanted to respond to what Chris said.  You know, in the last year that President Bush was in office, 2008, the deficit was 3.2 percent of the gross domestic product.  Today it's 10 percent.
Just--we just hit the $13 trillion cap on national debt, $2.3 trillion...

MR. GREGORY:  Well, let me just stop you, Senator.  Wait a minute.

SEN. CORNYN:  ...since Obama...

MR. GREGORY:  Where did some of that debt come from?  The president of the United States was George Bush when they passed a, a huge TARP, which was to bail out the banks.  I mean, that's what ran up a lot of debt, as well. You're saying that a Republican...

SEN. CORNYN:  Well, you're ignoring...

MR. GREGORY:  ...was, was somehow different.

SEN. CORNYN:  You're ignoring the stimulus that was--failed according to the own, the president's own standards.  He said it was supposed to keep unemployment to 8 percent.  A $2.6 trillion healthcare bill, which I agree with, with Pete, will bankrupt not only the private sector but the states and the federal government creating a new entitlement program.  My
point is that, you know, unemployment was roughly 6.9 percent when President Obama was elected.  Now it's 9.5 percent.  The deficit was 3.2 percent the last year President Bush was in office.  Now it's 10 percent. The debt was $2.3 trillion lower when--in 2008 than it is now because of runaway spending and debt.

MR. GREGORY:  So my question is still...

SEN. CORNYN:  Those are some of the policies people reacting to.

MR. GREGORY:  ...what is the distinction of the Republican Party of today vs. the, the Bush record that you're defending?

SEN. CORNYN:  Well, I think what people are looking for, David, are checks and balances.  They've had single party government, and it's scaring the living daylights out of them.  It's keeping job creators on the sidelines rather than investing and creating jobs.  That's why the
private sector isn't creating jobs.

MR. GREGORY:  Well, can't you understand people will see that as a strategy of saying no rather than saying yes to something?

SEN. CORNYN:  Well, my constituents in Texas, I have to tell you, to all the bad ideas that they hear coming out of Washington these days, no is a good start.  And then they want us to replace it with commonsense policies that actually make sense.  But the problem is, the, the--our friends on the Democratic side, including the president, have passed one unpopular policy measure after another and told the American people, "We don't care what you think, we're--we know what's, better than you do, what's good for you." And I think the birds are coming home to roost.

SEN. MENENDEZ:  Well, David, if the check and balance is to go back to exactly the same policies that gave us a 72 percent increase in the national debt to nearly $9.8 trillion.  If the check and balance is to take Bill Clinton's $230 billion surplus and make it a $1.5 trillion deficit, if the check and balance is the malaise of the Bush years in which incomes for families remained stagnant and jobs were lost, if the check and balance is to be with big oil, big insurance, and Wall Street against the average individual, then that's where the Republican
Party is at.

MR. GREGORY:  Let me, let me have--before we take a break and we'll come back and we'll talk about some particular issues where the two sides will debate, I want to ask one last question about the president's standing and, and to what extent it has an impact.  Politico's piece on Thursday was very interesting, the headline "Why Obama loses even by winning." And this is what they reported.  "Thursday's passage of financial reform just a couple of months after the passage of a comprehensive healthcare overhaul should decisively end the narrative that President Barack Obama represents a Jimmy Carter-style case of naive hope crushed by the
inability to master Washington.  Yet the mystery remains:  Having moved swiftly toward achieving the very policy objectives he promised voters as a candidate, Obama is still widely perceived as flirting with a failed presidency."

Congressman Van Hollen, this is not 1994 where Democrats were having a difficult time achieving anything.  There has been major achievement here, and yet, are Democrats reaping the rewards?

REP. VAN HOLLEN:  There has...

MR. GREGORY:  Reaping the benefits?

REP. VAN HOLLEN:  There absolutely has been major achievement, and you've ticked some of those off; but the fact remains that the economy is soft. And when you have a soft economy, people, understandably, are anxious. And the question they're going to have on their minds when they go into that voting booth and face two different candidates is, who is going to
best respond to the economy?  And I have to say, we're some minutes into this discussion yet and we still have not heard from our colleagues what they would do differently than the Bush economic agenda which got us into this mess?  We are now in positive job growth.

Let me make this point, we have the situation right now where our Republican colleagues are holding hostage an extension of middle class tax cuts.  They've said we're only going support a continuation of middle class tax cuts, those for people under $250,000, if you also extend the
Bush tax cuts for the very wealthy.  And by the way, that $700 billion over 10 years--you hear all this talk about deficit reduction--that they don't want to pay for, they want to leave that to children and grandchildren, we can make great progress today if our Republican
colleagues here agreed to allow those middle class tax cuts to be extended without having to add $700 billion to the deficit that our grandchildren and children will have to pick up.

MR. GREGORY:  But, Senator Menendez, Senator Bayh, another centrist Democrat that said raising taxes on wealthier Americans by allowing the Bush tax cuts to expire in January would be a real mistake in this economy.  Is that wrong?

SEN. MENENDEZ:  Well, the bottom line is what would be a mistake is to add $700 billion of debt to the next generation.  You know, when, when the number two Republican in the Senate, Jon Kyl, says, "We don't have to pay for that. We don't have to pay for it," you know, I am tired of listening to the lectures about spending and debt when they wracked up
record debt, when they are willing to put $700 billion of debt on the next generation, and when you don't have to pay for tax cuts for the wealthiest people in the country, but you can't help working Americans trying to get a job who presently are unemployed.

MR. GREGORY:  Final point before break, is President Obama an asset or a liability on the campaign trail?

REP. VAN HOLLEN:  Oh, he's absolutely an asset.

MR. GREGORY:  So he'll campaign across the country for Democrats?

REP. VAN HOLLEN:  Absolutely.  And he's been doing that.  He was in Michigan the other day at, at a car battery factory.  He's been around the country. He's an asset, and he's also very clearly drawing the distinctions here, what the choices are for voters going forward.

MR. GREGORY:  We're going to take a break.  We're going to come back. We're going to talk a little bit more about the Republicans, what the prescription is should they get the majority in the House.  We'll be right back.  More of our debate on Decision 2010 and the balance of power in Washington right here on MEET THE PRESS.


MR. GREGORY:  The debate for the fall campaign.  More of our discussion with the chairs of the four congressional campaign committees, right after this brief commercial break.


MR. GREGORY:  And we are back, continuing our Decision 2010 debate with the four leaders responsible for winning congressional races for their party this fall.

And, Congressman Sessions, I want to go back to you.  This has been a debate so far this morning about, you know, the relative merits of Republican rule during the Bush years and what this president has or has not accomplished so far.  I think what a lot of people want to know is if Republicans do get back into power, what are they going to do?

REP. SESSIONS:  It's quite simple that the American people do understand the agendas that are before us.  They understand what the president and the speaker stand for, and they understand what Republicans stand for. Republicans, and especially our candidates who are all over this country, very strong standing with the American people back home, we need to live
within our own means.  And certainly the projections that are ahead including health care and the projections for unemployment for a long time and debt for as far as we can see is staggering.  We need to live within our own means.  Secondly, we need to make sure that we read the bills.  These bills are so bad, which is why we don't have a budget that
is being looked at now.  The 2011 budget is staggering in terms of taxes, and the, the discipline that is lacking from this House Democratic leadership to even debate and bring the bill for the budget and appropriations to the floor is a lack of leadership.  And lastly...

MR. GREGORY:  But, Congressman, that's a, that's a pretty gauzy agenda so far.  I mean, what specific--what painful choices are Republicans prepared to make?  Are they going to campaign on repealing health care, for instance, repealing financial regulation?  Would you like to see
those two things done?

REP. SESSIONS:  Well, first of all, let's go right to it.  We're going to balance the budget.  We should live within our own means, and we should read the bills and work with the American people.

MR. GREGORY:  How do you do it?  Tell me how you do it.  Name a painful choice that Republicans are prepared to say we ought to make.

REP. SESSIONS:  Well, first of all, we need to make sure that as we look at all that we are spending in Washington, D.C., with, not only the, the entitlement spending but also the bigger government, we cannot afford anymore. We have to empower the free enterprise system.  See, this is where...

MR. GREGORY:  Congressman, these are not specifics.

REP. SESSIONS:  Oh, they...

MR. GREGORY:  And voters get, get tired of that.

REP. SESSIONS:  That, that...

MR. GREGORY:  You want to deal with entitlement spending...

REP. SESSIONS:  They are...

MR. GREGORY:  ...will you raise the retirement age on Social Security, will you cut benefits in Social Security?

REP. SESSIONS:  Let, let--let's go...

MR. GREGORY:  Will you repeal health care?

REP. SESSIONS:  Let's go right to it.

MR. GREGORY:  Do it.

REP. SESSIONS:  And Chris talked right about it.  He wants to diminish employers' abilities to be able to be competitive across this world.  We need to make sure that we allow employers, which was in that 52-page report that was presented to the president of the United States by CEOs in this country, we need to go back to the exact same agenda that is empowering the free enterprise system rather than diminish it.

MR. GREGORY:  Senator, I'm sorry, I'm not hearing an answer here on specific--what painful choices to really deal with the deficit.  Is Social Security on the table?  What will Republicans do that, that, that would give them--like '94, there was a Contract With America.  What are
voters going to say, "Hey, this is what Republicans will say yes to"?

SEN. CORNYN:  Well, the president has a debt commission that reports December the 1st, and I think we'd all like to see what they come back with.  We've got three of our most outstanding members on that commission--Mike Crapo, Tom Coburn and Judd Gregg--and I--my hope is
they'll come back with a bipartisan solution to the debt and particularly entitlement reform, as you, as you mentioned.  But I...

MR. GREGORY:  But wait a minute, conservatives need a, a Democratic president's debt commission to figure out what it is they want to cut?

SEN. CORNYN:  I said we need to do this on a bipartisan basis.  We've, we've had a, we've had a...

MR. GREGORY:  But what is the Republican Party stand for with regard...

SEN. CORNYN:  ...we've had a partisan juggernaut.

MR. GREGORY:  Right.

SEN. CORNYN:  Well, I mean, in, in part, what I alluded to earlier is what people are tired of is the runaway spending and the debt, and I think that is a positive agenda--smaller government, living with their means.

MR. GREGORY:  Do you, do you, do you campaign to repeal health care if you, if you have majority status?

SEN. CORNYN:  I think repeal and replace it with a commonsense solution that will bend the cost curve.  This bill has almost no reform. Individual businesses, individuals, and states are going to suffer a great financial loss as a result to the huge expansion of entitlements in
this healthcare bill.  We had alternatives, as you saw, at the summit that Lamar Alexander and others articulated...

MR. GREGORY:  Right, and we're...

SEN. CORNYN:  ...that the president...

MR. GREGORY:  We're not going to--we, we won't debate all the issues with health care, but I just want to get...

SEN. CORNYN:  Well, you, well, you asked what the positive...

MR. GREGORY:  What about, what about repealing financial reform?

SEN. CORNYN:  Well, you asked what the...

MR. GREGORY:  Is that something you think that Republicans would stand for?

SEN. CORNYN:  Well, you asked what the positive agenda was.

MR. GREGORY:  Right.

SEN. CORNYN:  And I think it's clear that, that Republicans had a positive alternative in health care.  I think Bob Corker was very articulate in saying he hoped for a, a, a compromise that would actually make sense instead of preserving the too-big-to-fail and--doctrine and
the, and the prospect of bailouts.

MR. GREGORY:  So repeal financial regulation, yes, no or maybe?

SEN. CORNYN:  Well, I think--I mean, this is a 2,300-page bill that not even Chris Dodd, the principal Senate author, knows--he said, "We don't know exactly how this will impact the economy or our financial systems for some time to come." I mean, that's part of the problem, as Pete said, passing legislation with unintended consequences and based on an ideological approach as opposed to, "Let's solve the problem" and to help encourage the growth of the economy.  As the folks in the business roundtable said, the job-killing agenda of this administration is to make...


SEN. CORNYN: the reason why people are sitting on the sidelines--the job creators, the investors, the entrepreneurs."

SEN. MENENDEZ:  Let me answer...

MR. GREGORY:  Well, one...

SEN. MENENDEZ:  Let me answer the question for you.

MR. GREGORY:  ...but one thing that is fair, just to challenge you as well, you look at polling, there are a lot of voters out there who would like to go back and begin at scratch and begin all over and--rather than supporting the Obama economic policies.  That's a reality.

SEN. MENENDEZ:  Well, I think, actually, when you look at the choice between where the president has taken the country from what he inherited vs. what our colleagues espouse, which is in essence the Bush voodoo economics, the reality is, in that choice, they have a very clear preference for the president's economic policies.  Let me answer the question that my dear friend John wouldn't.  Yes, they want to repeal health care, and they say replace.  Well, you'll have a whole host of issues that you enjoy today that won't be enjoyed anymore.  You won't see seniors closing that prescription drug gap that they have, you won't be able to have pre-existing conditions no longer be a bar to you getting insurance; you won't have a child born at birth who now will be able never--if they have a defect--to no longer be denied insurance.  And yes, we have cost controls in that bill.  On Wall Street reform, look, two weeks before, two weeks before Wall Street reform bill was passed, you know, a hedge fund manager ultimately raised a million dollars for Republican candidates two weeks before the bill was being voted on, and they tried to stop us four times in the Senate before we got the Wall Street reform.  I think that people in America believe in a free market as we as Democrats do, but there's a difference between a free market and a free fall market.

MR. GREGORY:  But, Congressman...

SEN. MENENDEZ:  They would permit the free fall market.

MR. GREGORY: do have exploding debt in this country, you have near 10 percent unemployment and the president made a major policy agenda built around creating a new government entitlement.  That's hurting him with a lot of voters.

REP. VAN HOLLEN:  The fact is, as the CBO has, has scored, which is the nonpartisan Congressional Budget Office, that if you look at a 20-year period, you actually reduce the deficit by $1.4 trillion, which means if you do what they want to do and repeal it, they're actually adding to the deficit.  If, if I could just go make a couple points here because Pete
really said what we're saying.  I wrote it down.  They want to go back to the same agenda, the same agenda that got us into this mess.  Now, the Bush tax cuts for the wealthy in 2001, 2003, we know they didn't create any jobs because at the end of that eight-year period you had a loss of private sector jobs, and that is fact. And why in the world we would want
to go back to that agenda, I think, is a mystery to me and it's going to be a mystery to the American people going forward.  What he, what he--they do have some creative ideas, including the guy who's their point person on the, on the budget committee, which is the road map plan, and what they would do there is go back to a proposal to partially privatize
Social Security, which is something Pete has supported, and, and we, we can have that debate, but the American people need to know that.  And they also have a plan to turn Medicare into a voucher program; you give the senior the voucher--by the way, the value of that voucher is going to decrease substantially--and we're going to throw you over to the
insurance industry.  Those are the ideas their point person on the budget committee has, and people need to...

MR. GREGORY:  Congressman...

REP. VAN HOLLEN: understand that.

MR. GREGORY:  ...Congressman Sessions, I want to ask you some, some political operative questions, as well, that, that play a role here. Some of it has to do with money and how much candidates can raise.  It affects both parties, it affects the ability to get out the vote, which
is very important, as you know, in a midterm race.  Why is it that in this political environment that we have been--all been talking about, it has been difficult for Republicans to raise the kind of money that Democrats successfully raised when they were challenging Republican rule
in 2006?

REP. SESSIONS:  In 2006, Republicans had more money, and we lost.  And one thing that, that is very apparent is the American people are not after money, they're after progress.  And the progress that's being made in Washington is what Democrats will be judged for.  The progress that they're making, despite what is being said here about George Bush...

MR. GREGORY:  So--but so raising money doesn't...

REP. SESSIONS: about...

MR. GREGORY:  ...raising money doesn't matter?

REP. SESSIONS:  You know, during the last few months Republicans have raised more money, and we will probably be outspent maybe even 1.7-to-1. But the American people understand what is happening in Washington, D.C., and this is an agenda that's out of control.

MR. GREGORY:  I want to talk about the tea party as well, Senator Cornyn. The impact, whether it's Sarah Palin or some prominent tea party candidates--we'll put a few that are running in Senate races, ones to watch this year in terms of tea party impact:  Sharron Angle running against Majority Leader Harry Reid, of course, in Nevada; Marco Rubio running against Charlie Crist, who is now an independent running for the Senate, and we're still waiting to see who the Democrat will be; and of course, Rand Paul, a Republican in Kentucky.  And yet, there are some real debates going on about the role of the tea party and whether there are racist elements within the party itself.  The NAACP had its meeting this week and talked about--called on the tea party to really stand up to some of those forces.  This is how it was reported in the Kansas City Star this week.  The headline, "The NAACP resolution addresses tea
parties." The organization "passed a resolution Tuesday calling on all people--including tea party leaders--to condemn racism within the tea party movement.  ...

The resolution asserts that tea party supporters have engaged in `explicitly racist behavior, displayed signs and posters intended to degrade people of color generally and President Obama specifically.' ...

The tea party movement is not just about higher taxes and limited government, the resolution says, `but something that could evolve and become more dangerous for that small percentage of people that really think our country has been taken away from them.'" Is this a problem?

SEN. CORNYN:  Well, I think it's slanderous to suggest that the vast movement of citizens who've gotten off the couch and gotten--showed up at town hall meetings and tea party events, somehow to smear them with this, this label, it's just, there's just no basis for it.  But I think the--what the tea party movement demonstrates, and I think the, the, the enthusiasm that we're seeing from independents and Republicans, is that if Washington isn't going to change itself, then we're going to change Washington.  And I think that's what we're seeing.  And if, if folks like in Nevada, for example, 14 percent unemployment since Harry Reid--now
that Harry Reid is running for re-election, 20--after 27 years in the United States Congress, if you want to continue those policies and those sorts of results, then go ahead and vote for Harry Reid.

MR. GREGORY:  Well...

SEN. CORNYN:  And if you want, if you want change, if you want people who are willing to live within their means and to rein in this runaway spending and debt, then, then they have an alternative.

MR. GREGORY:  Well, you talk about Nevada.  Let's look at the latest polling out of Nevada...

SEN. CORNYN:  Mm-hmm.

MR. GREGORY:  ...that shows, in fact, Senator Reid pulling now ahead of Sharron Angle.  And we can put those on the screen.  He's now up 44 to 37 percent.  This comes after a time when Sharron Angle has made some pretty extreme statements about a slush fund, calling the BP compensation fund a slush fund, something she later backtracked from.  She's talked about
Second Amendment remedies for her political opponents.  And the criticism is that the tea party is, in fact, injecting candidates who are too extreme to actually win re-election.  Is, is that a concern for you?

SEN. CORNYN:  Well, let's, let's look what Harry Reid has said.  He's called the former chairman of the Federal Reserve a hack.  He declared the Iraq war lost and the surge a failure before it even started in 2007. And he called the former chairman of the Joint Chiefs of Staff
incompetent.  I mean, Harry Reid is known for his gaffes.  But this isn't going to be about personalities, I believe, this is going to be about policies.  That's really the--where our colleagues don't...

MR. GREGORY:  All right.  But that, but...

SEN. CORNYN:  ...on the other, side don't seem to understand.

MR. GREGORY:  But this is different.  This is a question of whether some of these tea parties are too extreme.

SEN. CORNYN:  It's the policies are unpopular.

MR. GREGORY:  You've got Rand Paul who got into trouble with extreme comments, and you have a movement of tea partiers who, in effect, are arguing that they should govern when they're fundamentally opposed to government.  How much of a problem is that?

SEN. CORNYN:  Well, I believe these are, these, these are citizens who should not be demonized and marginalized.  These are people who are concerned about the direction of the country.  They have every right to participate in the political process and to make sure their views are represented in Washington, because they see Washington running away with,
not only their present prosperity, but also the burden it's putting on our children and grandchildren.

MR. GREGORY:  But, Congressman, you, you heard Senator Lott say this week that if they're elected they should be co-opted by the Republican Party, or should there be a tea party caucus in the House?

REP. SESSIONS:  I think it's clear to me that what--when I look at the tea party, it's about one-third Democrat, one-third Republican, one-third independents.  But 100 percent of them are sure that the agenda that is taking place in Washington, D.C., is about extremism and is about bankrupting this country and every state within this country.  And Chris talked about how the federal government will see this $1.2 trillion surplus, or at least the diminishment of the debt, but they're passing that on to other people and diminishing employment at the same time.  This agenda is outrageous, and the American people are seeing in our candidates where we're going to talk about balance.

MR. GREGORY:  Congressman--all right.  But, Congressman Van Hollen, Van Hollen, what is the impact of the tea party in the fall?

REP. VAN HOLLEN:  Well, it's a, a mixed bag for the Republicans.  On the one hand, there's a lot of energy on the tea party's side.  On the other hand, it is driving a lot of their candidates farther and farther to the right.  Most of the districts that are in play are the swing districts,
they're centrist districts, and what the tea party movement has done is take a lot of their nominees farther to the right.  We saw in a special election last year in upstate New York, a seat that had been held by the Republicans since Abraham Lincoln was president, that the tea party movement drove the more moderate Republican candidate out of the race
entirely.  And Bill Owens ran a good campaign, focused on jobs and the economy, and won a seat that had been held by a Republican since the Civil War.  So there's a real danger for them in moving farther to the right, but that is the reality of what's happening.

MR. GREGORY:  Senator Menendez, did the NAACP go too far?

SEN. MENENDEZ:  Well, I think they expressed their views based upon signs, statements, and other things, and so I'll let their judgment as the nation's conscience on race stand for their own proposition.  But I will say this about the tea party.  Look, it's not about marginalizing
people.  I'm glad to see people get involved in their government.  But there's a reason that my colleague here wanted Sue Lowden vs. Sharron Angle.  There's a reason he wanted Trey Grayson in Kentucky vs. Rand Paul.  Because he understood that the people who won those races in the tea party movement are too extreme in their positions even for their
state.  When you want to put radioactive waste in Yucca Mountain, when you want to phase out Social Security, when you want to abolish the Department of Education, it's not going to sell in Nevada. When Rand Paul, you know, says that it's un-American to pressure BP to do the right thing in the gulf, it's not going to sell.  So, at the end of the day, it's not because they are part of a movement, it's because their positions are too extreme for the general election environment.

MR. GREGORY:  We've got about a minute left.  I want to go around the table here.  Senator Cornyn, I will start with you.  A prediction for the fall, what kind of pickups do you think you're looking at, if any, in the Senate?

SEN. CORNYN:  Well, we're leading or tied in about eight seats currently held by Democrats, and, if the election were held today, it'd be a pretty good election.  But we've got almost 100, a little bit more than 100 days to go, and it's anybody's guess.  But we're looking for a pretty good November 2nd.

MR. GREGORY:  How many seats do you think?

SEN. CORNYN:  I don't know.

MR. GREGORY:  Senator?

SEN. MENENDEZ:  Democrats in the Senate will be a majority after this election, despite midterm election history and headwinds.  We are competitive. Six weeks ago we were sitting here with you.  We are competitive in a series of races that we weren't in--that a Republican
held that we wouldn't have said that six weeks ago.

MR. GREGORY:  Do Democrats hold the House?

REP. SESSIONS:  I think our candidates are going to take us from good to great to victory, and I think Republicans can win in November.

MR. GREGORY:  How many seats?

REP. SESSIONS:  I think we're going to be slightly over 40.

MR. GREGORY:  Slightly over 40.  That means the majority's gone.  Where do you see it?

REP. VAN HOLLEN:  I know these guys are popping the champagne bottles already over there, but the fact of the matter is the Democrats will retain a majority in the House.  We know that it's going to be a tough election.  But the fact of the matter is when voters focus on the choice before them, whether it's to continue the progress we've made or go back to the policies that got us into this mess to begin with...

MR. GREGORY:  All right.

REP. VAN HOLLEN:  ...the choice is clear.

MR. GREGORY:  We are going to, we are going to leave it there.  Thank you all very much.  We'll have you back before election time.

Up next, a look back in our MEET THE PRESS MINUTE.  It was 1974, a tumultuous year then for the GOP after Watergate.  The chairs of both political parties appeared right here on MEET THE PRESS and offered their predictions for the upcoming midterm elections.  Did they get it right?
We'll find out after this brief station break.


MR. DAVID GREGORY:  And we are back with our MEET THE PRESS MINUTE. Predictions and elections go hand in hand.  This morning we've heard all their predictions for this November.  But here's a look back at the spin coming from both parties just three days ahead of the 1974 midterms, when things were looking bleak for the Republicans.  The Watergate scandal was
still looming large following President Nixon's resignation in August, and unemployment was at a three-year high.  November 3rd, the heads of the two major national political committees, Robert Strauss, chairman of the Democratic National Committee, and Mary Louise Smith, chairman of the Republican National Committee, appeared right here on MEET THE PRESS and
tried to put their best foot forward.

(Videotape, November 3, 1974)

MR. ROBERT STRAUSS:  I think every poll shows that people in this nation are disturbed about the economy.  They're disturbed about their way of life.  I think the polls also show by two or 2 1/2-to-1 that the, the people of this nation have more confidence in the Democrats' ability to, to meet their economic needs, meet the great unmet needs of this nation,
and deal with their problems, the people's problems.

MR. LAWRENCE SPIVAK:  You really think it's going to be an endorsement of the party and not a protest vote?

MR. STRAUSS:  Well, I think it's going to be a referendum, if you will, on who's best able to come to grips with the great problems facing this nation today, and I think we'll win that referendum.  Yes.

I think we'll gain five seats in, in the Senate, conceivably four and conceivably six.  I know that's an extreme estimate, but I believe we'll do that well.  I think in the House that we'll gain 27 to 31 or two seats.  A little more difficult to predict.  I think we'll do that well.

MR. SPIVAK:  Ms. Smith, many political observers and pollsters predict Republican disaster Tuesday because of Watergate, inflation, and the recession.  Do you have any reason to believe that they might be wrong?

MS. MARY LOUISE SMITH:  I think there is reason to believe that they might be wrong.  I, I see a movement in the country and I see a turning around on some of the races, and I think we're going to do much better than people have predicted.

MR. SPIVAK:  Will you be as brave as Mr. Strauss and give us your predictions of what you think you're going to do?

MS. SMITH:  I don't know whether that's bravery or not.  I will not make an estimate.  I think it does nothing but prove whether I'm a good prognosticator or whether I am not, and I have not played the numbers game.  I'll just say that I think we're going to do much better than
people are predicting.

(End videotape)

MR. GREGORY:  Well, not even the Democratic Party chairman guessed correctly just how much of a landslide victory it would be for his party. The Democrats picked up 48 seats in the House, increasing their majority to above the two-thirds mark.  They also picked up four seats in the
Senate.  These new members would become known collectively, of course, as "Watergate Babies."

We'll be right back.


MR. DAVID GREGORY:  That is all for today.  The debate will continue.  A special thanks to our viewers in Europe.  It is good to be back with you on CNBC.  We'll be back next week.  If it's Sunday, it's MEET THE PRESS.