Showing posts with label Presidential Debate. Show all posts
Showing posts with label Presidential Debate. Show all posts

Sunday, January 8, 2012

New Hampshire Republican Primary NBC-Facebook (Full Transcript) - Republican New Hampshire

MR. DAVID GREGORY: This Sunday, a special edition of MEET THE PRESS live from New Hampshire, the last debate before the first in the nation Republican presidential primary. Voting here is just 48 hours away. We come to the Granite State where nearly one in five voters remains undecided despite seeing these candidates face-to-face in town halls, coffee shops and even in their living rooms, a small state that will have a big impact on the race. Their motto, "Live free or die." The issues: jobs and the economy, America's role in the world, and which of these candidates is best suited to take on President Obama. This morning, a debate in partnership with Facebook, the world's number one social platform, and the New Hampshire Union Leader. The candidates, the issues and your questions.

Announcer: This is the NBC News/Facebook Republican Candidates Debate from the Capitol Center for the Arts in Concord, New Hampshire. Here now, the moderator of MEET THE PRESS, David Gregory.

MR. GREGORY: And good morning and welcome to this special edition of MEET THE PRESS. The final debate before New Hampshire voting begins. All six candidates are here; and before we begin, you know the drill, we quickly go through the rules. Each candidate will have one minute, 60 seconds, to make their statement, to respond to questions and, at my discretion, 30 seconds for follow-ups or rebuttals. We're on a pretty tight schedule, so I will ask the candidates to stay within their allotted time, and we'll see how that goes.

We've partnered with Facebook, so some of the questions will come from me and some, of course, will come from you. We encourage you to weigh in on the debate in real time. Our online app at mtp.msnbc.com. You can monitor the conversation there and we'll see some of your feedback during that debate over the course of this debate.

Candidates, good morning.

Republican Candidates: (In unison) Good morning.

MR. GREGORY: I just want to say on behalf of all Americans that I thank you for being willing to debate each other every 10 hours, whether you feel you need it or not.

This is an important moment. Elections are about choices. They're about distinguishing one from the other. There is a political element to that, and of course it has to do with policy, as well. Governor Romney has won the Iowa caucuses, although narrowly. He's up in the polls here in New Hampshire, he's also up in the polls down in South Carolina.

Speaker Gingrich, why shouldn't Governor Romney be the nominee of this party? What about his record concerns you most or makes him disqualified to be the nominee?

FMR. REP. NEWT GINGRICH (R-GA): Well, look, I think what Republicans have to ask is who's most likely in the long run to survive against the kind of billion dollar campaign the Obama team is going to run. And I think that a bold, Reagan conservative with a very strong economic plan is a lot more likely to succeed in that campaign than a relatively timid Massachusetts moderate who even The Wall Street Journal said had an economic plan so timid it resembled Obama. So I think you've got to look at, you know, Massachusetts was fourth from the bottom in job creation under Governor Romney. I--we created 11 million jobs while I was speaker, and I worked with Governor--with President Reagan in the entire recovery of the 1980s. So I just think there's a huge difference between a Reagan conservative and somebody who comes out of the Massachusetts culture with an essentially moderate record who I think will have a very hard time in a debate with President Obama. That simple.
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MR. GREGORY: Speaker Gingrich, bottom line, you believe that Governor Romney is unelectable.

FMR. REP. GINGRICH: No, I don't believe he's unelectable, but I think he's a much--look, against Obama's record, I think, you know, the fact is President Obama's going to have a very hard re-election effort, but I do think the bigger the contrast, the bolder ideas, the clearer the choice, the harder it is for that billion dollar campaign to smear his way back into office.

MR. GREGORY: Speaker, this is your flier that you're circulating here in New Hampshire.

FMR. REP. GINGRICH: Right.

MR. GREGORY: It says very clearly, "Romney is not electable."

FMR. REP. GINGRICH: I think he'll have a very hard time getting re-elected--getting elected.

MR. GREGORY: Governor.

FMR. GOV. MITT ROMNEY (R-MA): David, I'm very proud of the record that I have, and I think the one thing you can't fool the people about New Hampshire about is the record of a governor next door. And people have watched me over my term as governor and saw that I was a solid conservative and that I brought important change to Massachusetts. They recognize that I cut taxes 19 times, balanced the budget ever one of the four years I was governor, put in place a $2 billion rainy day fund by the time I'd gone. We had--we'd seen job losses in the months leading up to my becoming the governor and then we began to finally create jobs. By the way, we created more jobs in Massachusetts than Barack Obama's created in the entire country. We also got our state police to enforce illegal immigration laws, put in place English immersion in our schools. I'm very proud of the conservative record I have, and I think that's why some of the leading conservatives in today's world who are fighting the conservative battles of today, who don't have any ax to grind have gotten behind my campaign: Governor Nikki Haley of South Carolina, Governor Chris Christie of New Jersey, right here, the great senator of New Hampshire, Kelly Ayotte. These are conservatives who looked at my record, looked at my plan to get this economy going. I happen to believe that if we want to replace a lifetime politician like Barack Obama, who had no experience leading anything, you have to choose someone who's not been a lifelong politician, who has not spent his entire, entire career in Washington and, instead, has proven time and again he can lead, in the private sector, twice, in the Olympics, and as a governor. We've got to nominate a leader if we're going to replace someone who is not a leader.

MR. GREGORY: Well, Senator Santorum, had you not lost re-election in 2006, you would've been in Washington even longer than you were. It would've been 21 years. So you've got a long Washington record. How do you address this question, why shouldn't Governor Romney be the nominee? What is disqualifying in your judgment?

FMR. SEN. RICK SANTORUM (R-PA): Well, if his record was so great as governor of Massachusetts, why didn't you run for re-election? I mean, if you didn't want to even stand before the people of Massachusetts and run on your record. If it was that great, why didn't you--why did you bail out? I mean, the bottom, the bottom line is, you know, I go and fight the fight. If it was that important to the people of Massachusetts that you were going to go and fight for them, at least you can stand up and, and make the battle that you did a good job.

I did that. I ran for re-election a couple of times and I won a couple of times in, in a 71 percent Democratic district. When I ran for re-election, I was redistricted. When I was in a 71 percent Democratic district, I had a 90 percent conservative voting record. It was a hard thing to do. My district is more Democrat than the state of Massachusetts that...(unintelligible). It was the steel valley of Pittsburgh, and I stood up and fought for the conservative principles. I didn't do what Governor Romney did in 1994. I was running the same year he ran in 1994. I ran in the tough state of Pennsylvania against an incumbent. Governor Romney lost by almost 20 points. Why? Because at the end of that campaign, he wouldn't stand up for conservative principles, he ran from Ronald Reagan, and he said he was going to be to the left of Ted Kennedy on gay rights, on abortion, a whole host of other issues. We want someone when the time gets tough, and it will in this election, we want someone who's going to stand up and fight for the conservative principles, not bail out and not run, and not run to the left of Ted Kennedy.
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MR. GREGORY: But you did say when you endorsed him four years ago, just those words, that he would stand up for conservative principles, Senator.

FMR. SEN. SANTORUM: Vis-a-vis John McCain.

MR. GREGORY: Vis-a-vis John McCain. Governor, your response.

FMR. GOV. ROMNEY: Well, a lot of things that were inaccurate in that, I'm not going to through them one by one, but, but I can tell you this, I think it's unusual and, and perhaps understandable that people who spend their life in politics imagine that if you get in politics that that's all you want to do, that if you've been elected to something, well, you get--you want to get re-elected and re-elected. I went to Massachusetts to make a difference. I didn't go there to begin a political career, running time and time again. I made a difference, I put in place the things I wanted to do, I listed out the accomplishments we wanted to pursue in our administration. There were 100 things we wanted to do. Those things I pursued aggressively, some we won, some we didn't. Run again? That would be about me. I was trying to help get the state into the best shape I possibly could. Left the world of politics, went back into business. Now I have the opportunity, I believe, to use the experience I have--you've got a surprised look on your face.

FMR. SEN. SANTORUM: So whenever--Governor...

FMR. GOV. ROMNEY: Oh, wait, it's still my--it's still my time.

FMR. SEN. SANTORUM: ...are you going to--are you going to tell people you're not going to run for re-election for president if you win?

FMR. GOV. ROMNEY: Rick, Rick, Rick, Rick, it's still my time.

FMR. SEN. SANTORUM: I'm just asking.

FMR. GOV. ROMNEY: OK. Well...

MR. GREGORY: Go ahead, Governor Romney...
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FMR. GOV. ROMNEY: ..actually, actually...

MR. GREGORY: ...Governor Romney, take 30 seconds there.

FMR. GOV. ROMNEY: Yeah. What I'm going to tell you is, this, for me, politics is not a career. For me, my career was being in business and starting a business and making it successful. My life's passion has been my family, my faith and my country. I believe by virtue of the experiences I've had that I'm in a good position to make a contribution to Washington. I long for a day when, instead of having people who go to Washington for 20 and 30 years, who get elected and then, when they lose office, they stay there and make money as lobbyists or connect into businesses. I think it stinks. I think we ought to have people go to Washington and serve Washington and serve as, as their--the people of their--of their nation and go home. I'd like to see term limits in Washington.

FMR. SEN. SANTORUM: So one term.

FMR. GOV. ROMNEY: No.

MR. GREGORY: Let me get in here, Speak...

FMR. GOV. ROMNEY: As the president of the United States, as the president of the United States, if I'm elected, of course I'll fight for a second term.

MR. GREGORY: Speaker Gingrich...

FMR. GOV. ROMNEY: There's a lot of work to be done.

MR. GREGORY: ..take 30 seconds here.

FMR. REP. GINGRICH: Oh yeah, Mitt, I, I realize the red light doesn't mean anything to you because you're the front-runner.
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FMR. GOV. ROMNEY: Newt.

FMR. REP. GINGRICH: But, but, but can we drop a little bit of the pious baloney. The fact is, you ran in '94 and lost. That's why you weren't serving in the Senate with Rick Santorum. The fact is you had a very bad re-election rating, you dropped out of office, you'd been out of state for something like 200 days preparing to run for president. You didn't have this interlude of citizenship while you thought about what to do. You were running for president while you were governor. You were going all over the country, you were, you were out of state consistently. You then promptly re-entered politics. You happened to lose to McCain as you had lost to Kennedy. Now you're back running. You've been running consistently for years and years and years. So this idea that suddenly citizenship showed up in your mind, just level with the American people, you've been running for--at least since the 1990s.

MR. GREGORY: Governor, please.

FMR. GOV. ROMNEY: Mr. Speaker, citizenship has always been on my mind. And, and I happened to see my dad run for governor when he was 54 years old. He had good advice to me. He said, "Mitt, never get involved in politics if you have to win election to pay a mortgage. If you find yourself in a position when you can serve, well, you have responsibility to do so if you think you can make a difference." He said also don't get involved in politics if your kids are still young because it may turn their heads. I never thought I'd get involved in politics. When I saw Ted Kennedy running virtually unopposed in 1994, a man who I thought, by virtue of the policies of the liberal welfare state had created a permanent underclass in America, I said someone's got to run against him. And I happened to have been wise enough to realize I didn't have a ghost of a chance of beating him. This guy from--a Republican from Massachusetts was not going to beat Ted Kennedy, and I told my partners at my firm, "I'll be back in six months, don't take my chair," and I went in and gave it a real battle and went after it. It was--I was happy that he had to take a mortgage out on his house to ultimately defeat me. And I'm, I'm very proud of the fact that I have stood up as a citizen to battle where I felt it was best for the nation.

MR. GREGORY: Let...

FMR. GOV. ROMNEY: And we're talking about running for president. I'm in this race because I care about the country, I believe my background and experience will help me be an effective president.

MR. GREGORY: All right, let me bring, let me bring Dr. Paul into this because there is a question about who is the true conservative in the race. And Governor Romney said only nine years ago during an interview with New England Cable News, he said the following, "I think people recognize that I'm not a partisan Republican, that I'm someone who is moderate and my views are progressive." Do you believe Governor Romney now when he says that he is a man of constancy and that he'll stand up for conservative principles?

REP. RON PAUL (R-TX): You know, I think this whole discussion so far has been very superficial, and I think the question in a way that you ask is superficial and that you're talking about character, which is very important, but I think we should deal with the issues as well. But I don't see how we can do well against Obama if we have any candidate that, you know, endorsed, you know, single-payer systems and TARP bailouts and don't challenge the Federal Reserve's $15 trillion of injection bailing out their friends. I don't see how we can have anybody really compete with Obama who doesn't challenge this huge empire we have overseas and the overseas spending. I mean, this is how nations come down is they extend themselves too far overseas. That's how the Soviets came down. We, we really have to talk about real cuts, and we haven't gotten around to this yet. So if we want to change things, this is what we have to talk about. Character is important and motivation's important and our history is important, but I really consider that in the debate format to be less significant than what we really believe in.

MR. GREGORY: You ready my mind, Dr. Paul. And we're going to get to some of the tough choices, not just on politics, but on policy.

First, Governor Perry, I do want to ask you, though, flat out, your stake in your campaign going down to South Carolina, is Governor Romney unelectable in your judgment?

GOV. RICK PERRY (R-TX): Well, I think you have to ask the question of who is it that can beat Obama, who is it that can invigorate the, the Tea Party, who is it that can take the message of, of smaller, outsider government that's truly going to change that place is. I look from here down to Rick Santorum I see insiders, individuals who have been the big-spending Republicans in, in Washington, D.C. And let's be honest with ourselves. I mean, the fact of the matter is that Obama has thrown gasoline on the fire, but the bonfire was burning well before Obama got there. It was policies and spending both from Wall Street and from the insiders in Washington, D.C., that got us in this problem. And we need a candidate that can not only draw that stark contrast between themselves and Barack Obama, but also stand up and lead the Tea Party movement back. 2010 was about the Tea Party standing up and understanding that Republicans, big-spending Republicans, had caused as much of this problem as anything. And it was their power that brought...
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MR. GREGORY: OK.

GOV. PERRY: ...together--that brought Washington, D.C., and the House to Republican control...

MR. GREGORY: All right, before...

GOV. PERRY: ...and that's the kind of individual that we got to have to lead this election.

MR. GREGORY: Before I get to Governor Huntsman, I'd be remiss, Governor Romney, if I did not allow you to respond to the quote that I read from you nine years ago. What would you say to conservatives so that they'll trust that you will stand up for conservative principles?

FMR. GOV. ROMNEY: They've got my record as governor. That's the great thing, and people here in New Hampshire, is they see what I did as governor of Massachusetts. I also got--at the occasion after my last failed attempt to run for president--a learning experience--to sit down and write a book. And I wrote a book and described my view for the country, and people can describe it in differing ways. But, but my view is the, the principles that I've learned in business and the principles as governor, frankly, have made me more conservative as time has gone on. I've seen a lot of government try to solve problems, and it didn't work. And, and my view is that the right course for America is to have someone who understands how the economy works who will passionately get America back on track.

MR. GREGORY: All right. We're going to come back to the question of obstacles to the nomination. But let me get to policy, Governor Huntsman. This is, by all accounts, an age of austerity for this country--a jobs crisis, also a spending crisis in Washington. I wonder what specifically you would do to say to Americans, "These are cuts I'm going to make in federal spending that will cause pain, that will require sacrifice."

FMR. GOV. JON HUNTSMAN (R-UT): Let me say, let me say, first of all, with respect to Governor Romney, you know, there are a lot of people who are tuning in this morning, and I'm sure they're terribly confused after watching all of this political spin up here. I was criticized last night by Governor Romney for putting my country first. And I just want to remind the people here in New Hampshire and throughout the United States that I think--he criticized me while he was out raising money, for serving my country in China. Yes, under a Democrat, like my two sons are doing in the United States Navy. They're not asking who--what political affiliation the president is. I want to be very clear with the people here in New Hampshire in this country: I will always put my country first. And I think that's important to them.

MR. GREGORY: All right, well, why don't you get a response Governor Romney, and then I'll come back to you on the austerity question.

FMR. GOV. ROMNEY: I think we serve our country first by standing for people who believe in conservative principles and doing everything in our power to promote an agenda that does not include President Obama's agenda. I think the decision to go and work for President Obama is one which you took. I don't, don't disrespect your decision to do that. I just think it's most likely that the person who should represent our party running against President Obama is not someone who called him a remarkable leader and went to be his ambassador in China.

FMR. GOV. HUNTSMAN: This nation is divided, David, because of attitudes like that. The American people are tired of the partisan division. They have had enough. There is no trust left among the American people and the institutions of power and among the American people and our elected officials.
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MR. GREGORY: All right.

FMR. GOV. HUNTSMAN: And I say we've had enough and we have to change our direction in terms of coming together as Americans first and foremost and finding solutions to our problems.

MR. GREGORY: Dr. Paul said let's not be superficial. Let's talk substance. So, Governor Huntsman, name three areas where Americans will feel real pain in order to balance the budget.

FMR. GOV. HUNTSMAN: Well, I would have to say that I agree with the Ryan plan. I think I'm the only one standing up here who has embraced the Ryan plan. It's a very aggressive approach to taking about 6.2, $6.2 out of the budget over 10 years. And it looks at everything. And what I like about it is it says there will be no sacred cows. Medicare won't be a sacred cow, Department of Defense won't be a sacred cow. As president of the United States, I'm going to stand up and I'm going to say, "We are where we are, 24 percent spending as a percentage of GDP, we've got to move to 19 percent sustainable."

MR. GREGORY: Three programs that will make Americans feel pain, sir.

FMR. GOV. HUNTSMAN: Well, let me just say on, on entitlements. Across the board, I will tell the upper income category in this country that there will be means testing. There are a lot of people in this nation who don't need...

MR. GREGORY: Social Security and Medicare.

FMR. GOV. HUNTSMAN: Absolutely. Absolutely. And also, I'm not going to tie Department of Defense spending to some percentage of GDP. I'm going to tie it to a strategy that protects the American people. And if we think that we can't find efficiencies and cuts in the Department of Defense budget, then we are crazy.

MR. GREGORY: Senator Santorum, same question. Three programs that would make--would have to be cut to make Americans feel pain, to sacrifice, if we're going to balance the budget.

FMR. SEN. SANTORUM: I would agree with Governor Huntsman that means testing--I talked about that in Hollis yesterday. We had about 1,200 people there, and I walked through and talked about how we have to make sure that we're not going to burden future generations with a Social Security program that's underfunded. It's underfunded right now. And we have to take those who've--have been successful who are seniors who have a tremendous amount of wealth and we ought to reduce benefits. It makes no sense for folks who are struggling right now to pay their payroll tax which is the biggest tax--it's tax on labor, makes us uncompetitive--and the idea that some on the left would have to raise those taxes to make labor even more uncompetitive for those working people who are trying to get a job to subsidize high-income seniors doesn't make any sense to me.

Food stamps is another place. We got to block grant it, send it back to the states just like I did on welfare reform. Do the same thing Medicaid. Those three program. We got--including housing programs, block grant them, send them back to the states, require work, and put a time limit. You do those three things, we will help take these programs, which are now dependency programs, which people are continually dependent upon, and you take them in to transitional programs to help people move out of poverty.
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MR. GREGORY: Speaker Gingrich, on the issue of Medicare, where you were on MEET THE PRESS earlier in the year, you had talked about what Paul Ryan was talking about is a step too far, which is moving seniors on to a premium support or a voucher program, depending on how you phrase it. As you know, Senator Santorum thinks that current seniors should be moved off of that program into premium support or a voucher program. Do you agree with doing it that quickly and making current seniors bear the brunt of that?

FMR. REP. GINGRICH: Well, the fact is that the Ryan-Wyden bill, which was just introduced recently, actually incorporates allowing people to choose and allows them to stay in traditional Medicare with the premium support model, or go to new methods. And I think it's a substantial improvement because it allows for a transition in Medicare in a way that makes sense. But, David, you know, I, I find it fascinating that very, very highly paid Washington commentators and Washington analysts love the idea of pain. What--who's going to be in pain? The duty of the president is to find a way to manage the federal government so the primary pain is on changing the bureaucracy. On, on theft alone, we could save $100 billion a year in Medicaid and Medicare if the federal government were competent. That's a trillion dollars over 10 years, and the only people in pain would be crooks. So I think a sound approach is to actually improve the government, not punish the American people because of the failure of the political class to have any sense of cleverness.

MR. GREGORY: Governor Perry, from Facebook, a lot of questions, as we've mentioned, have been submitted. And this from Martin Montalvo, because we do have a spending crisis but also a lot of people hurting. He writes this: "With more Americans on government assistance than ever before, is it un-American for Americans to feel relieved when the government helps them?"

GOV. PERRY: Well, let me answer the question that you asked earlier, what are the three areas that you would make some reductions that people would feel some pain, and I would tell you it would be those bureaucrats at the Department of Commerce and, and Energy and Education that we're going to do away with.

MR. GREGORY: And that's your final answer?

GOV. PERRY: But, you know, the fact of the matter is that, that Americans want to have a job. That, that's the issue here. And the idea that, that there are people clamoring for government to come and to give them assistance is just wrong-headed. And, and that's what we need to be focusing on as a people is how do we create the environment in this country where the entrepreneurs know that they can risk their capital, have a chance to have a return on the investment, and create the, the jobs out there so people can have the dignity to take care of their families. That's what Americans are looking for. I've done that for the last 11 years in the state of Texas and have the executive governing experience that no one else up here on this stage has.

MR. GREGORY: All right. I'm going to leave it there. We're going to take a quick break. We're going to come back live from New Hampshire with many more questions for the candidates and feedback from you. So please participate online at mtp.msnbc.com. We're coming right back to New Hampshire.

(Announcements)

MR. GREGORY: And we, we are back on this special edition of MEET THE PRESS from here in New Hampshire. We want to get right back to the questions here with our candidates. And before the break, we were talking about Medicare. Paul Ryan, Senator Santorum, had a plan where he'd like to move seniors off, give them a voucher or premium support, and then they would take care of their health care from there. There's a lot of debate about that. And I mentioned you said seniors should be affected right now, 55 plus, have them affected right now, which has been somewhat controversial. You want to respond to that.

FMR. SEN. SANTORUM: Well, you know, I hear this all the time when I was--have been campaigning around the state, you know, "We should have the same kind of health care the members of Congress have." Well, that's pretty much what Paul Ryan's plan is. It's--the members of Congress have a premium support model. So does every other federal employee. I mean, it works very well as, you know, the federal government has a liability, they put, put money out there and then if you want, you, you have about this thick, if you're an employee in Washington, D.C., of--got a whole bunch of different plans to choose from, and you have all sorts of options available to you. If you want a more expensive plan, you pay more of a co-insurance. If you want a less expensive plan, you don't. But here's the fundamental difference between Barack Obama and, and everybody up here, it's whether you believe people can be free to make choices or whether you have to make decisions for them. And I believe seniors, just like every other American, should be free to make the choices in their healthcare plan that's best for them.

MR. GREGORY: Governor Romney, there's a lot of discussion, a lot of discussion this morning on Facebook about taxes. And as we talk about taxes and spending, of course, we talk about economic security and economic growth. There's been a debate in Washington and beyond, as you well know, between Warren Buffett and Grover Norquist. Grover Norquist, the anti-tax crusader, says no tax increases under any circumstances. Warren Buffett says, "Hey, the wealthier in this country can pay more and they should pay more." Indeed, balancing the budget is a way for more economic growth down the line. Who knows more about the American economy, Grover Norquist or Warren Buffett?
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FMR. GOV. ROMNEY: Well, who knows more about tax policy, I'm not sure that we're going to choose from the two of them. But I can tell you this, the right course for America is not to raise taxes on Americans. I understand that President Obama and people of his political persuasion would like to take more money from the American people, and they want to do that so they can continue to grow government. And the answer for America is not to grow government, it is to shrink government. We've been going--over the last 20, 30, 40 years, government keeps growing at a faster rate relative to inflation. We've got to stop the extraordinary spending in this country. That's why I've put out a plan that reduces government spending, I cut, I cut programs, a whole series of programs, by--by the way, the number one cut is Obamacare. That saves $95 billion a year. Return--just as Rick indicated, return to states a whole series of programs, food stamps, housing vouchers, Medicaid, and then set how much goes to them. And finally, with regards to entitlements, in the entitlement reform area, I do not want to change Medicare and Social Security for current retirees. But for younger people coming up, they have to recognize that, in the future, higher income people will receive less payments in the premium support program.

MR. GREGORY: Governor Huntsman, who knows more about the American economy? You, you, in addition to that question, you seem to be a little bit uncomfortable with the moment from earlier in this debate cycle when everybody said that they would reject even a 10 to 1 ratio of cuts to new taxes.

FMR. GOV. HUNTSMAN: It was, it was a silly format. I mean, it was an important question, and they asked to raise our hands, I mean, for heaven sake, we didn't even get a chance to talk about it. I put a tax reform proposal on the table endorsed by The Wall Street Journal that goes farther than anybody else's on this stage. It calls for what absolutely needs to be done, and everybody knows about it. We are so chock full of loopholes and deductions, it weighs down our tax code to the tune of one trillion one hundred billion dollars. You can't compete that way. It gives rise to lobbying on Capitol Hill that needs to clean up. We've got to phase out loopholes and deductions in total, and we've got to say so long to corporate welfare and to subsidies because this country can no longer afford it, and we've got to prepare for competition in the 21st century.

MR. GREGORY: Speaker Gingrich, if you become President Gingrich and the leader of the Democrats, Harry Reid, says he's going to promise to make you a one-term president, how would you propose to work with someone like that in order to achieve results in Washington?

FMR. REP. GINGRICH: I think every president who works with the leader of every opposition knows they're working with somebody who wants to make them a one-term president. I mean, you know, that, that's the American process. I worked with Ronald Reagan in the early 1980s. Tip O'Neill was speaker, he wanted to make Reagan a one-term president. We had to get one-third of the Democrats to vote for the Reagan tax cuts, and we did. As speaker, I was negotiating with Bill Clinton. He knew I wanted him to be a one-term president, and we got a lot of things done, including welfare reform, because you have to reach--I agree with what Governor Huntsman said earlier. You have to, at some point, say, "The country comes first. How are we going to get things done? We'll fight later. Let's sit down in a room. Let's talk it through. I'll tell you what I need, and I'll tell you what I can't do. You tell me what you need, and you tell me what you can't do." And it sometimes takes 20 or 30 days, but if people of good will, even if they're partisans, come together, talk it out--you know, we got welfare reform, the first tax cut in 16 years, 4.2 percent unemployment and four straight years of a balanced budget with a Republican speaker and a Democratic president. So it can be done with real leadership.

MR. GREGORY: Anybody else have a point of view about how you actually work with the other side when they've committed to working against you? Governor?

FMR. GOV. ROMNEY: Yeah, I mean, I was governor of a state that had a, a slightly Democratic leaning House and Senate. My legislature was 85 percent Democrat, and I went around at the very beginning of having been elected and met with the speaker of the House and the Senate president. The Senate president said something I won't forget. He said, "Mitt, the campaign is over. The people expect us to now govern for them." And we did. We met every week. We rotated in offices. We got to know each other personally. We developed a relationship of respect and rapport, even though we disagreed on a lot of issues. And when crises arose, as they did time and again--we had a severe budget crisis. I went to them and said, "Will you give me unilateral power to cut spending without even a vote of the legislature?" They had enough confidence in me they decided to do that. And, and I was able to cut the spending on an emergency basis, not just slow down its rate of growth. We can work together. Republicans and Democrats are able to go across the aisle because we have common--we really do have areas of common interest. Even though they're dramatically different perspectives on how the world works and what's right, we can find common ground. And I have proven in a state that is very Democrat that I'm able to work with people. Nineteen tax cuts, protected charter schools, drove our schools to be number one in the nation, kept them there, rather. I, I--that, that record can work with Republicans and Democrats who are willing to work together.

MR. GREGORY: Dr. Paul, there's this question of argument vs. accomplishment. The question again comes from Facebook. Heath Treat writes, I want to--Paul Treat, rather, "I want to know what Ron Paul's plan of action will be to achieve getting the House and Senate to help him do all he's promised?" And here's the record, Dr. Paul. You have actually sponsored 620 measures. Only four made it to a vote on the House floor, and only one has been signed into law.

REP. PAUL: You know, that demonstrates how much out of touch the U.S. government and the U.S. Congress is with the American people because I'm supporting things that help the American people. That's the disgust that people have because they keep growing government, whether it's the Republicans in charge or the Democrats in, in charge. But as far as working with other groups, I think my record's about as good as anybody's because I work on the principle that freedom and the Constitution bring people together, for different reasons. People use freedom in different ways. Like it does, it invites variations in our religious beliefs. And economically we tell people that they're allowed to, you know, spend their money as they choose. On civil liberties, that's a different segment. Republican conservatives aren't all that well known for protecting privacy and personal liberties. And when it comes to this spending overseas, I can work a coalition. Matter of fact, my trillion dollar proposal to cut spending doesn't immediately deal with Social Security. It's to try to work our way out of Social Security. I'm cutting a trillion dollars by attacking overseas spending and going back to '06 budget. And I do not believe that you have to have pain. People who have gotten special privileges and bailouts from the government, they may get the pain, but the American people, if they get their freedom back and get no income tax, they don't suffer any pain.

MR. GREGORY: Senator Santorum, here's the reality, two previous presidents, President Bush talked about being a uniter and not a divider; President Obama talked about transforming Washington, and it hasn't worked. Washington is polarized. The country is polarized. And the American people are pretty sick of the fact that nothing gets done in Washington. Specifically, how do you change that?

FMR. SEN. SANTORUM: Well, let me first address Congressman Paul, because the, the serious issue with Congressman Paul here is, you're right, he's never really passed anything of any, of any import. And, and one, one of the people, one of the reasons people like Congress Paul is his economic plan. He's never been able to accomplish any of that. He has no track record of being able to work together. He's been out there on the, on the margins, and has really been unsuccessful in, in working together with anybody to do anything.
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The problem is that what Congressman Paul can do, as commander in chief, is he can, on day one, do what he says he wants to do, which is pull all our troops back out of seas, overseas, put them here in America, leave us in a, in a, in a situation where the world is now going to be created huge amounts of vacuums all over the place and, and have folks like China and Iran and others. Look at the Straits of Hormuz. As I said last night, we wouldn't even have the Fifth Fleet there. The problem with Congressman Paul is all the things that Republicans like about him he can't accomplish, and all the things they're worried about he'll do day one. And, and that's the problem. And, and so what we--what, what we need to do is have someone who has a plan and has experience to do all the things Republicans and conservatives would like to do. And I...

MR. GREGORY: Let me get Dr. Paul to respond.

FMR. SEN. SANTORUM: And then I'd like my opportunity to get back and answer your question.

REP. PAUL: You know, it's...

MR. GREGORY: Well...

REP. PAUL: It's not exactly a simple task to repeal approximately 100 years of us sliding away from our republic and still running a foreign policy of Woodrow Wilson, trying to make the world safe for democracy. And, look, we have elections overseas, and we don't even accept the elections. No, change in foreign policy is significant. But that's where a nation will come down if they keep doing this. We can't stay in 130 countries, get involved in nation building. We cannot have 900 bases overseas. We have to change policy. What about change in monetary policy? Yes, we do. But we've had that for 100 years. And right now we're winning that battle. The American people now agree. About 75 percent of the American people now say we ought to audit the Federal Reserve, find out what they're doing and who are their friends that they're bailing out constantly.

MR. GREGORY: Senator Santorum, come back to this point. It's easy to say, "Boy, I'm going to change the culture in Washington." Hasn't worked for the past two presidents.

FMR. SEN. SANTORUM: Well, it's--it worked in my case. Look at welfare reform. A federal entitlement that--I remember standing next to Daniel Patrick Moynihan, Ted Kennedy, who were out there just talking about how this was going to be the end of civilization as we know it. There would be bread lines, the, the horrific consequences of removing federal income support from basically mothers with children. And we stood up and said, no, that creating dependency and creating that dependency upon, upon federal dollars is more harmful than--and in--not believing in people and their ability to work is more harmful. And so we stood up and fought, and went out to the American public. Bill Clinton vetoed this bill twice. We had hard opposition, but I was able to, to work together and paint a vision. We made compromises, but not on our core principles. The core principles were this was going to end a federal program, we were going to require work, we were going to put time limits on welfare. I stuck to those principles, and we were able to compromise on some things like transportation funding and some day care funding, all in order to get a consensus that poverty is not a disability.

MR. GREGORY: All right.

FMR. SEN. SANTORUM: And that programs that we need to put in place should help transition people, not make them dependent. And we were able to get 70 votes in the United States Senate, including, 17 Democrats.

MR. GREGORY: Governor Huntsman, this question of, if the leader of the Democrats promised to make you a one-term president, how would you go about dealing with them in a more effective way than you think the man you serve, President Obama, did?
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FMR. GOV. HUNTSMAN: I think it comes down to one word, David, and I think the one word is trust. When the American people look at the political process play out, they hear all the spinning and all the doctrinaire language, and they still walk away with the belief that they're not being represented in Congress, that there's no trust in the executive branch. I mean, Simpson-Bowles bipartisan proposal lands right on the desk of Barack Obama and it lands in the garbage can. The first press conference I had when I ran for governor in 2004 was on ethics in government service. I talked about term limits, I talked about campaign finance reform, I talked about the role of lobbyists and knew I wouldn't make a lot of friends. I had one member of the legislature who supported me in that run. We won because we had the will of the people. And I believe the next president, and if that is to be me, I want to roam around this country, and I want to generate the level of excitement and enthusiasm that I know exists among the American people to bring term limits to Congress, to close the revolving door on members going right on out and becoming a lobbyist. We've got to start with the structural problems. There is no trust.

MR. GREGORY: All right. Governor Perry, I want to continue on the theme of leadership.

GOV. PERRY: Good. We need to.

MR. GREGORY: This is, as you well know, New Hampshire is an independent place. And I wonder where, besides criticizing the previous administration for running up the debt, I wonder where you would buck your party. What would you say or do to make Republicans uncomfortable?

GOV. PERRY: I hope I'm making Republicans uncomfortable right now by talking about the spending that they've done back in the 2000s when we had control of both parties.

MR. GREGORY: Right, but aside from that, I just, I just mentioned that.

GOV. PERRY: I mean, that is--that is--well, listen. Dr. Paul says that the biggest problem facing this country is, is our work overseas. I disagree with that. The biggest problem facing this country today is a Congress that is out of control with their spending. And we've got to have someone, an outsider, that will walk in, not part of the insider group that you see here, people who have voted for raising the debt limit, people who have been part of the problem that is facing America. I will tell you two things that can occur, that a president can lead the charge on, and it will put term limits into place. One of those is a part-time Congress to tell those members of Congress we're going to cut your pay, we're going to cut the amount of time that you spend in Washington, D.C., send you back to your districts so you can have a job like everybody else in your district has and live under the laws of which you passed...

MR. GREGORY: But, governor...

GOV. PERRY: ...and then a balanced budget amendment to the United States Constitution.

MR. GREGORY: Governor, my question...

GOV. PERRY: You do those two things...
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MR. GREGORY: But my question, sir, was...

GOV. PERRY: ...and that will make them uncomfortable.

MR. GREGORY: Do you think telling conservatives, "A balanced budget amendment is something I'm going to do, and I'm going to cut spending," that's going to make them uncomfortable?

GOV. PERRY: You're darn right because there's a bunch of people standing up here that say they're conservatives, but their records don't follow up on that.

MR. GREGORY: All right. I've got to take another break here. We'll come back, we'll come back on this point.

Another quick break here. We'll return with much more. And, of course, please share your thoughts with us online via Facebook at mtp.msnbc.com.

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Announcer: The NBC News/Facebook Republican Presidential Candidates Debate continues in partnership with the New Hampshire Union Leader.

MR. GREGORY: And we are back in New Hampshire. I'm happy to be joined now by our local partners for the debate. For the--from the New Hampshire Union Leader, senior political reporter John DiStaso is, is with us.

MR. JOHN DiSTASO: Hi, David.

MR. GREGORY: Good to have you here, John. And from WHT--WHDH--we had this problem yesterday--TV, in Boston, Channel 7 in Boston, political editor Andy Hiller. Welcome to you as well. Glad to have you both.
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John, get us started.

MR. DiSTASO: All right. Governor Huntsman, it's winter in New Hampshire, it's a little mild, but it's still winter. Home heating oil is nearly $4 a gallon, yet President Obama and Congress have cut by 25 percent the program that helps, helps low-income people heat their homes. About a million households that were helped last year won't be helped this year. Is this an example of pain that must be suffered? Should this, should this program funding be restored? Should it be cut more? Should this program be eliminated, perhaps? Where does this fit in? This is a practical problem in this area of the country.

FMR. GOV. HUNTSMAN: No. We have people in need, we have people suffering, and this is a challenge that we need to address. But I believe we're not going to be able to effectively confront it head-on until such time as this nation begins to move more toward greater energy diversity and energy independence. One of the first things I would do as president is I would take a look at that one product distribution bias that always favors one product, and that's oil. And I'd say if we're going to do what this nation needs to be done in terms of using a multiplicity of products that we have in such diversity and abundance and get them to the customers, we're going to have to break up that one product distribution monopoly. And I want to do to that oil distribution monopoly what we did to broadcast communication in the, in the early 1970s. We blew it apart. We went to the Federal Trade Commission and said, "We need more. We need diverse sources to draw from. We need, we need to service the consumers. I believe if we're going to do what needs to be done from an energy independence standpoint, all products, getting the products to the customer, we've got to disrupt that one product monopoly that does not serve this country well, nor its consumers.

MR. DiSTASO: Congressman Paul, Congressman Paul, how do you feel about, how do you, how do you feel about subsidies in general for, for a specific energy and also, though, more, more specifically right now, more immediately, this low-income program, heating assistance program?

REP. PAUL: Right.

MR. DiSTASO: Is this something that fits in under your view of what government does do or should not do?

REP. PAUL: Mm-hmm. Well, subsidies, per se, are--it's bad economic policy, it's bad moral policy because it's using government force to transfer money from one group to another, and economically it does a lot of harm. But when it, when it comes to energy, we should, you know, deregulate it like others talk about. But we need to talk--you know, supply and demand. Everyone knows about supply and demand. they talk about oil and if we had more alternative sources that we always hope the prices will go down. But everybody forgets that there's an--50 percent of a transaction is the monetary unit. And you don't deal--very few people talk about the supply and demand of money. And when you create a lot of money, prices go up. So it goes up in the areas where government most gets involved, you know, in education, in medical care, housing, and in energy. So prices go up much faster than any other place. So if you subsidize somebody, and you print money to do it, you compound the problem. It's good politics, yeah, "I'm going to subsidize you and take care of you," but it's bad economic policy, and it's not a good way to find any answers.

MR. GREGORY: Governor Romney, this is such an important topic because beyond the regional implication, there's also a larger question about the social safety net. You talk all the time about opportunity for Americans, but what about Americans left behind? In this age of austerity, what do Americans have to learn to live with less of?

FMR. GOV. ROMNEY: Well, what we don't need is to have a, a federal government saying we're going to solve all the problems of poverty across the entire country because the--what it means to be poor in Massachusetts is different than Montana and Mississippi and other places of the country. And that's why these programs, all these federal programs that are bundled to help people and make sure we have a safety net, need to be brought together and sent back to the states and let states that are closest to the needs of their own people craft the programs that are able to deal with their--the needs of those folks. So you--whether it's food stamps and housing vouchers, they're certainly on the list, but certainly Medicaid, home heating oil support. What, what, unfortunately, happens is, with all the multiplicity of federal programs, you have massive overhead with government bureaucrats in Washington administering all these programs. Very little of the money that's actually needed by those that really need help, those that can't care for themselves, actually reaches them. These--they--government--folks in Washington keep building program after program. It's time to say enough of that. Let's get the money back to the states the way the Constitution intended and let states care for their own people in the way they feel best.

MR. GREGORY: Andy Hiller.

MR. ANDY HILLER: Governor Romney, I'd like to remind you of something you said in Bay Windows, which is a gay newspaper in Massachusetts, in 1994 when you were running against Senator Kennedy. These are your words: "I think the gay community needs more support from the Republican Party, and I would be a voice in the Republican Party to foster anti-discrimination efforts." How have you stood up for gay rights and when have you used your voice to influence Republicans on this issue?
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FMR. GOV. ROMNEY: Andy, as you know, I don't discriminate. And in the appointments that I made when I was governor of Massachusetts, a member of my Cabinet was gay. I appointed people to the bench, regardless of their sexual orientation, made it very clear that, in my view, we should not discriminate in hiring policies, in legal policies. At the same time, from the very beginning in 1994, I said to the gay community, "I do not favor same-sex marriage." I oppose same-sex marriage, and that has been my, my view. But, but if people are looking for someone who, who will discriminate against gays or will in any way try and suggest that people that, that have different sexual orientation don't have full rights in this country, they won't find that in me.

MR. HILLER: When's the last time you stoop up and spoke out for increasing gay rights?

FMR. GOV. ROMNEY: Right now.

MR. HILLER: Senator Santorum, would you be a voice for increasing gay rights in the party?

FMR. SEN. SANTORUM: Surprised it's coming to me. What? What was your question?

MR. HILLER: Would you be a voice for speaking out for gay rights in your party, and if not, why not?

FMR. SEN. SANTORUM: I would be a voice in speaking out for making sure that every person in America, gay or straight, is treated with respect and dignity and has the equality of opportunity. That does not mean that I would agree with certain things that the gay community would like to do to change laws with respect to marriage or respect to adoption and things like that. So you can be respectful. This is the beautiful thing about this country. James Madison called the First Amendment, he called it the, the, the perfect remedy, and that is people of all different backgrounds, diversity, opinions, faith, can come into the public square and can be heard, and can be heard in a way that's respectful of everybody else. But just because you don't agree with someone's desire to change the law doesn't mean you don't like them or you hate them or you want to discriminate against them. But you're trying to promote--excuse me--promote things that you think are best for society. And I do so, and I think if you, if you watch the, the town hall meetings that I've been doing all over New Hampshire, I do so in a respectful tone. I listen to the other side. I let them make their arguments, and then we do so in a very, very respectful way. And you know what, we may not agree. That's why we leave it open to the public to be able to elect members of Congress and the Senate and the president who will support their ideas.

MR. HILLER: What if you had a son who came to you and said he was gay?

FMR. SEN. SANTORUM: I would love him as much as I did the second before he said it, and I would try to do everything I can to be as good a father to him as possible.

MR. GREGORY: John...(unintelligible).

MR. DiSTASO: Governor Perry, we're going to move on. Right, right to work, which outlaws mandatory union membership, as you know, continues to be a major issue in the state of New Hampshire. You've, you've spoken about promoting, having states pass state laws. What about on the federal level? Do you see this as a federal issue and one that you would promote as president or as a state by state?
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GOV. PERRY: Actually, it is a federal issue, and it's a federal issue because of the law that was passed that forces the states to make a decision about whether or not they're going to be right to work. So Jim DeMint's legislation, I would support that of repealing that legislation that forces states to make that decision to be a right to work rather than all of this country being right to work. Listen, I'm not anti-union, I'm pro job. And the way you're--you promote this country's rehabilitation from the Obama administration's attack on, on job creation is by taxes and regulation, particularly the regulatory side, and pulling those regulations that have gone forward over the course of the last--since '08, and test them all for do they create jobs or do they kill jobs. And if they kill jobs, you throw them out. That will make more difference in this country from the standpoint--I'm a right to work guy. I come from a right to work state, and I will tell you, if New Hampshire wants to become the magnet for job creation in the Northeast, you pass that right to work legislation in this state.

MR. DiSTASO: I'd like to, I'd like to ask both Governor Romney, quickly, and Senator Santorum, quickly, do--what positive contributions do labor unions provide in this country at this, this point in the 21st century?

FMR. GOV. ROMNEY: Well, the carpenters union, for instance, trains their workers to be more effective on the job, and when they compete against non-union workers, why they do that on a fair basis. If that happens, that's a positive contribution. But let me just say this with regards to unions. I agree with Governor Perry, right to work legislation makes a lot of sense for New Hampshire and for the nation. But also, let's not forget the government unions and the impact they're having. If we're going to finally pull back the extraordinary political power government unions are exerting in this country, we're going to have to say that people who work for the government, government workers, should have their compensation tied to that which exists in the private sector. People who are government servants, public servants, should not be paid more than the taxpayers who are paying for it.

MR. GREGORY: Governor, can I just--Senator, very quickly, Senator, because we're about to hit a hard break, a quick comment on this?

FMR. SEN. SANTORUM: OK. Yeah, I will. I have signed a pledge that I would support a national right to work. When I was in--I mentioned this last night, when I was a senator from Pennsylvania, I didn't vote for it because Pennsylvania's not a right to work state, and I didn't want to vote for a law that would change the law in Pennsylvania, number one. Number two, what can unions do? As, as Mitt mentioned, they can do training. They also do a lot in the community. I work with a lot of labor unions in Philadelphia and other places to do a lot of community involvement work and they, they try to participate as good members of the community like the business does.

MR. GREGORY: I got to cut you off. I apologize. We have a mandatory break. We'll be back with more questions in just a moment.

(Announcements)

MR. GREGORY: We have come to the end of our first hour of this NBC News/Facebook debate here in New Hampshire. A few NBC stations may be leaving us now, but for most of you and everyone watching live on MSNBC and online, please stay tuned.

(Announcements)

Announcer: The NBC News/Facebook Republican Presidential Candidates Debate continues from New Hampshire. Now, the moderator of MEET THE PRESS, David Gregory.

MR. GREGORY: And we are back for our final half-hour. So much discussion, Speaker Gingrich, on Facebook, in the course of this debate, about jobs. And you can understand why. And we've talked about spending, we've talked about economic growth. It was Governor Romney who made the point to a young person who approached him that if he were president when this person got out of college he or she would have a job. If President Obama has a second term, he or she will not have a job. Isn't that the kind of thing that makes people angry with the politicians? Easy answers like that?
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FMR. REP. GINGRICH: Well, I don't think that's an easy answer. I think that's a statement of fact. You know, but let me, let me take--I want to go back to what John DiStaso said because it's exactly the same question. The long-term answer to $4 heating oil is to open up offshore development of oil and gas, open up federal lands to oil and gas, flood the market as, as Dr. Paul said, and make supply and demand work for us not against us. The price will come down. Under Obama, 2011 was the highest price of gasoline in history. It is a direct result of his policies which kill jobs, raise the price of heating oil and gasoline, weaken the United States, increase our dependence on foreign countries, and weaken our national security in the face of Iran trying to close the Straits of Hormuz. So the right president opening up in a Reagan tradition and using massive development of American energy--there's 3.2 percent unemployment in North Dakota. There's a hint here. You can actually have jobs, lower priced heating oil, which, by the way, means less LIHEAP spending so you get more revenue for the federal government from royalties, less spending on, on LIHEAP subsidy, lower price, people are happier all the way around. That's what supply-side economics was originally all about in the 1970s.

MR. GREGORY: But, Governor Romney, on this economic question, you blame President Obama for the jobs crisis, but when you look at the data and a positive trend line he still only gets the blame and none of the credit. How come?

FMR. GOV. ROMNEY: Actually, I don't blame him for the recession and for the decline. What I blame him for is having it go on so long and going so deep and having a recovery that's been so tepid. Businesses I've talked to all over the country that would normally be hiring people are not hiring, and I asked them why. And they say because they look at the policies of this administration and they feel they're under attack. When you have an administration that tries to raise taxes, and has, on businesses, when it puts in place Obamacare that's going to raise the cost of health care for businesses, when they stack the National Labor Relations Board with labor stooges, which means that the policies relating to labor are now going to change dramatically in a direction they find uncomfortable, when you have Obamacare that, that places more mandates on them, when you, when you have Dodd-Frank, which makes it harder for community banks to make loans, all these things collectively create the--a reality of a president who has been anti-investment, anti-jobs, anti-business, and people feel that. And if you want to get this country going again, you have to recognize that the role of government is not just to catch the bad guys, important as that is, it's also to encourage the good guys...

MR. GREGORY: All right.

FMR. GOV. ROMNEY: ...and to return America to a land of opportunity.

MR. GREGORY: Back to John and Andy.

John, go ahead.

MR. DiSTASO: Governor Romney, I'm going to stay with you for one moment here. On the--talking about regulation, one of your prime New Hampshire supporters, Senator Kelly Ayotte, has said, quote, "New Hampshire should not be the tailpipe for pollutants from out-of-state power plants." Many Senate Republicans attacked an EPA rule limiting air pollution that affects downwind states. But she and others, including Scott Brown, joined with the president and Senate Democrats to block a repeal effort. Now, is this an example of this cross-state air pollution rule of fair regulation, something that we in the Northeast are very concerned about in terms of pollution, or is this overregulation, job-killing overregulation?

FMR. GOV. ROMNEY: Well, I'm not, I'm not familiar with the specific regulation as it, as it applies to, to New Hampshire, but I do believe that we have a responsibility to keep the air clean, and we have to find ways to assure that we don't have the pollution of one state overwhelming the, the ability of another state to have clean air. I know in my state of Massachusetts we, we received a lot of air from the rest of the country, obviously, given the winds coming from the West of the country to the East. And so the responsibility in our state was to get the cost--get the, the emissions from our power plants down. That's one of the reasons why we moved to natural gas. And really, by the way, this discussion about energy and security and getting the cost of gasoline down, the big opportunity here is not just a new oil distribution system, but it's natural gas. We have massive new natural gas reserves that have been found in Pennsylvania, in, in North Dakota, South Dakota, Texas. Natural gas, cheap, a fraction of the cost per BTU of oil. If we want to help people in New England have, not only homes and businesses that emit less pollutant into the air and therefore would have cleaner air and also have lower cost energy, it's let's build out this natural gas system so that we can take advantage of that new enormous source of American economic strength.

MR. DiSTASO: Speaker Gingrich, what, what exactly is an environmental solutions agency? I don't--I think a lot of people might not know or understand that--why you want to disband the EPA and set up, set up something...

FMR. REP. GINGRICH: Well...
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MR. DiSTASO: ...that kind of looks like the EPA.

FMR. REP. GINGRICH: If you look at the EPA's record, it is increasingly radical, it's increasingly imperious, it doesn't cooperate, it doesn't collaborate, and it doesn't take into account economics. The city of Nashville recently had a dump that was cited by EPA. They went down to find out what was it being cited for. And they told them, "Frankly, we don't know. We can't find the records that led to this citation, and we're not exactly sure what it referenced, but it must be bad or we wouldn't have sent it out."

In Iowa they had a dust regulation under way because they control particulate matter. And I do agree on clean air. There are things they should do that are right. But dust in Iowa is, is an absurdity, and they were worried that the plowing of a cornfield would lead dust to go to another farmer's cornfield, and they were going to--they were planning to issue a regulation. In Arizona they went in on the dust regulation and suggested to them that maybe if they watered down the earth, they wouldn't have these dust storms in the middle of the year. And people said to them, "You know, the reason it's called a desert is there's no water." Now, this is an agency out of touch with reality, which I believe is incorrigible, and you need a new agency that is practical, has common sense, uses economic factors, and in the case of...

MR. GREGORY: All right, Speaker.

FMR. REP. GINGRICH: ...pollution actually incentivizes change, doesn't just punish it.

MR. GREGORY: All right. Andy.

MR. HILLER: Governor Perry, your party's last nominee, John McCain, wrote in The Washington Post in an op-ed about a year ago, his words, "I disagree with many of the president's policies, but I believe he is a patriot sincerely intent on using his time in office to advance our country's cause. I reject accusations that his policies and beliefs make him unworthy to lead America or opposed to its founding ideals." Agree?

GOV. PERRY: I make a very proud statement and a fact that we have a president that's a socialist. I don't think our Founding Fathers wanted America to be a socialist country. So I disagree with that premise that somehow or another that President Obama reflects our Founding Fathers. He doesn't. He talks about having a more powerful, more centralized, more consuming and costly federal government. I am a Tenth Amendment-believing governor. I truly believe that we need a president that respects the Tenth Amendment, that pushes back to the states, whether it's how to deliver education, how to deliver health care, how to do our environmental regulations. The states will considerably do a better job than a one-size-fits-all Washington, D.C., led by this president.

MR. GREGORY: Can I just jump in on--with Senator Santorum. Governor Perry, you called the president a socialist.

I wonder, Senator Santorum, when you voted for a new prescription drug benefit that did not have a funding mechanism, were you advancing socialism?

FMR. SEN. SANTORUM: Well, I've said repeatedly that we should have had a funding mechanism, and it's one of those things that I had a very tough vote, as you know. In that bill, we had health savings accounts, something I'd been fighting for for 15 years to transform the private sector healthcare system into a more consumer bottom-up way of doing it. We also had Medicare Advantage to transform the entire Medicare system into--Medicare Advantage is basically a premium support type model. So when you think...
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MR. GREGORY: Were you advancing socialism, though? That's the point.

FMR. SEN. SANTORUM: So--well, I, I think I'm just answering your question. Maybe I--maybe we're not communicating well. But I just talked about the medical health savings accounts is an anti-socialistic idea to try to build a bottom-up, consumer-based economy in health care. The same way with Medicare Advantage. And we also structured the Medicare Part D benefit to be a premium support model as a way of trying to transition Medicare. So there were a lot of good things in that bill. There was one really bad thing. We didn't pay for it, we should have paid for it and that was a mistake.

MR. GREGORY: Do you have another follow-up on that that?

MR. HILLER: No. I'm going to switch to Congressman Paul.

MR. GREGORY: Sure.

MR. HILLER: And I'm going to say many Americans, particularly Democrats, believe that health care is a right. In your opinion, what services are all Americans entitled to expect to get from government?

REP. PAUL: Entitlements are not rights. Rights mean you have a right--entitle--rights mean you have a right to your life and you have a right to your liberty and you should have a right to keep the fruits of your labor. And this is quite a bit different, but earlier on there was a little discussion here about gay rights. I, in a way, don't like to use those terms. Gay rights, women's rights, minority rights, religious rights. There's only one type of right, it's your right to your liberty. And I think it's caused divisiveness when we see people in groups because, for too long, we punish groups, so the answer then was let's relieve them by giving them affirmative action. So I think both are wrong. If you think in terms of individuals and protect every single individuals, no, they're not entitled. One group isn't entitled to take something from somebody else. And the basic problem here is there's a lot of good intention to help poor people. But guess who gets the entitlements in Washington? The big guys get them, the rich people. They run the entitlement system, the military industrial complex, the banking system.

MR. GREGORY: OK.

REP. PAUL: Those are the entitlements we should be dealing with.

MR. GREGORY: Dr. Paul, thanks. In our remaining moment here, back to you, John.

MR. DiSTASO: OK. Well, Governor Huntsman, Andy and I are about to wrap up our role in this debate and, as we do, I'd like to ask you as someone who's been here in New Hampshire awhile, what does our state motto, "Live free or die," mean to you personally and how would it guide you in the White House?
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FMR. GOV. HUNTSMAN: It is the fulfillment of a citizenry being able to live out the meaning of our founding documents--life, liberty and the pursuit of happiness. And everywhere I've gone in this great state, and we've done 160 plus public events, I feel it and I sense it and people take that very seriously. You know what else they take seriously? They take seriously the idea of real leadership. I've heard a lot of obfuscating up here, the blame game, talking about gays, talking about unions, everybody's got something to ask you to say. You know what the people of this country are waiting for and the people here? They want a leader who is going to unify, who's going to bring us together. Because, at the end of the day, that's what leadership is all about. It's not about taking on different groups and vilifying them for whatever reason. It's about projecting a vision for a more hopeful tomorrow. That's why there is no trust in this country today, and that's why, as president, I'm going to attack that trust deficit just as aggressively as I attack that economic deficit. Because, with no trust, I can't think of anything more corrosive longer term for the people of this nation.

MR. GREGORY: All right. We're going to--we're going to leave it there.

Thank, thank you, John, thank you, Andy, both.

We're going to take another quick break here. I'll be back with a final round of questions, including your questions from our MEET THE PRESS Facebook page. We're back with our final moments in just a moment.

(Announcements)

MR. GREGORY: We are back.

Gentlemen, candidates, we have just a few minutes left, and I'd like to try something because I do want to get to as much substance and pin you down on views as best I can. I know this could be hard for you, but you are spending a lot of money getting your message out in 30 second increments, based on what I've been watching in the hotel room here in New Hampshire. So I know you know how to do this. Let's try having 30 second answers to some of these questions that we might have some response along the way.

Senator Santorum, I want to ask you about Iran. It's been a big issue in the course of this campaign so far. I wonder why it is, if America has lived with a nuclear Soviet Union, we have come to live with a nuclear North Korea, why is it that we cannot live with a nuclear Iran? And if we can't, are you prepared to take the country to war to disarm that country?

FMR. SEN. SANTORUM: They're, they're a theocracy. They're a theocracy that has deeply embedded beliefs that the, the afterlife is better than this life. President Ahmadinejad has repeatedly said the principal virtue of the Islamic Republic of Iran is martyrdom. So when your principal virtue is to die for your--for Allah, then it's not a deterrent to have a nuclear threat if they would use a nuclear weapon. It is, in fact, an encouragement for them to use their nuclear weapon, and that's why there's a difference between the Soviet Union and China and others and Iran.

MR. GREGORY: What about Pakistan? They are in indifferent ally at best, they have nuclear weapons. Are you also prepared as president to say they must disarm or else?

FMR. SEN. SANTORUM: They are not a theocracy. And we're very hopeful of, of maintaining a more secular state than, than is in place today. But there is a serious threat, and this administration has bungled it about as badly as they can in trying to continue those positive relationships. We've had some real serious problems with the, with the Pakistani military. Obviously, with respect to Osama bin Laden, with respect to North Waziristan, but you have a--the reason is we have a president that's just very weak in, in that region of the world and is not respected...
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MR. GREGORY: All right.

FMR. SEN. SANTORUM: ...and, therefore, he's not, he's not been able to have that strong hand in working with Pakistan that they're used to.

MR. GREGORY: Speaker Gingrich, how about tone of this campaign? I was in Iowa, I heard you on the stump. You complained bitterly about the super PAC, the outside groups, that were lodging charges against you, bringing up some old issues against you. And now you have a former campaign spokesman who is preparing attacks against Governor Romney, calling him, quote, "a predator" for his involvement at the investment company Bain. You agreed with somebody who said that Governor Romney was a liar when he didn't take account for those attacks against you. Are you consistent now as you're preparing to launch against Governor Romney?

FMR. REP. GINGRICH: Sure.

MR. GREGORY: How so?

FMR. REP. GINGRICH: I'm consistent because I think you ought to have fact-based campaigns to talk about the records.

MR. GREGORY: Calling him a predator is not over the line?

FMR. REP. GINGRICH: Well, I think you have to look at the film, which I haven't seen, but if you look at The New York Times article that I think was on Thursday, you would certainly have to say that Bain, at times, engaged in behavior where they looted a company, leaving behind 1,700 unemployed people. That's The New York Times, that's not me. So I think--I mean, one of the ads I complained about got four Pinocchios from The Wall--from The Washington Post. Now, to get four Pinocchios in a 30-second ad means there's virtually nothing accurate...

MR. GREGORY: Right.

FMR. REP. GINGRICH: ...in 30 seconds.

MR. GREGORY: Speaker, you, you, you decry the Washington establishment, and you've just talked about The New York Times and The Washington Post, you have agreed with the characterization that Governor Romney is a liar. Look at him now, do you stand by that claim?
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FMR. REP. GINGRICH: Well, sure. Governor, I wish you would calmly and directly state it is your former staff running the PAC, it is your millionaire friends giving to the PAC, and you know some of the ads aren't true. Just say that, straight forward.

FMR. GOV. ROMNEY: Well, of course, it's former staff of mine. And, of course, they're people who support me. They wouldn't be putting money into a PAC that supports me if they weren't people who support me. And with regards to their ads, I haven't seen them. And, as you know, under the law, I can't direct their ads. Speaker, hold on a second. I, I can't direct their ads. If there's anything in them that's wrong, I hope they take it out. I hope everything that's wrong is taken out. But let me tell you this, the ad I saw said that, that you'd been forced out of the speakership, that was correct.

FMR. REP. GINGRICH: That's not true.

FMR. GOV. ROMNEY: It said that, that you'd sat down with Nancy Pelosi and, and argued for, for a climate change bill. That was correct. It said that you called the, the--Ron Paul's, Ron Paul, Paul Ryan's plan to, to provide, to Medicare reform, a, a, a right wing social engineering plan. It said that, that as part of an investigation, an ethics investigation, that you had to reimburse some $300,000. Those things were all true. If there was something related to abortion that it said that was wrong, I hope they pulled it out. Anything wrong, I'm opposed to. But, you know, this ain't, this ain't the bean bag. We're going to come into a campaign, we're going to describe the differences between us.

MR. GREGORY: All right.

FMR. REP. GINGRICH: Sure.

FMR. GOV. ROMNEY: But I, but I do think...

MR. GREGORY: (Unintelligible)...speak.

FMR. GOV. ROMNEY: But I do think the rhetoric, Mr. Speaker, I think was a little over the top.

FMR. REP. GINGRICH: You think my rhetoric was over the top...

FMR. GOV. ROMNEY: Well, I, I...
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FMR. REP. GINGRICH: ...but your ads were totally reasonable?

FMR. GOV. ROMNEY: I, again...

FMR. REP. GINGRICH: I just want to understand, look, I've taken the governor's to speak...

FMR. GOV. ROMNEY: Again, Mr. Speaker, Mr. Speaker, the, the super PACS that are out there running ads, whether Ron Paul's, mine, yours, as you know, that is not my ad. I don't write that ad. I can't tell them not to.

MR. GREGORY: Well, how about this, would you both...

FMR. GOV. ROMNEY: And--but, but I did, but, Mr. Speaker...

MR. GREGORY: Would you both agree to take these super PAC ads down?

FMR. GOV. ROMNEY: But, Mr. Speaker, I, I wouldn't call some of the things you--you've called me public. I think that's just over the top.

MR. GREGORY: Would you both agree that--to, to request that these super PAC ads be taken down?

FMR. REP. GINGRICH: Well, David, wait a second, come on. Come on. I'm glad, finally, on this stage that weeks later he has said, "Gee, if they're wrong, they should take them down." They would, of course--we've sent a letter in South Carolina saying to--warning the stations to just fact check them before they start running them. But I'm taking his advice. You know, I--we started to run his commercial from, from 1994 attacking Teddy Kennedy for running negative ads. We thought, no, that would be wrong. So instead, I, I agree with him. Takes broad shoulders to run, can't take the heat, get out of the kitchen. When the 27 1/2 minute movie comes out, I hope it's accurate. I, I, I can say publicly I hope that the super PAC runs an accurate movie about Bain. It'll be based on establishment newspapers like The Washington Post, The Wall Street Journal, The New York Times, Barron's, Bloomberg News. And I hope that it's totally accurate, and then people can watch the 27 1/2 minutes of his career at Bain...

MR. GREGORY: All right.
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FMR. REP. GINGRICH: ...and decide for themselves.

MR. GREGORY: Let me ask you, Senator Santorum, we've talked some about the role of government, but the presidency is often called the bully pulpit. I wonder as president how you'd use the bully pulpit to try to shape American culture and values.

FMR. SEN. SANTORUM: I haven't written a lot of books, I've written one, and it was in response to a book written by Hillary Clinton called, "It Takes a Village." I didn't agree with that. I believe it takes a family, and that's what I wrote. And I believe that there's one thing that is undermining this country, and it is the breakdown of the American family. It's undermining our economy, and you see the rates of poverty among single parent families, which are--moms who are doing heroic things, but it's harder. It's five times higher in the single parent family. We, we know there's certain things that work in, in, in America. Brookings Institute came out with a study just a few--a couple of years ago that said if you graduate from high school and if you work, and if you're a man, if you marry, if you're a woman, if you marry before you have children, you have a 2 percent chance of being in poverty in America. And to be above the median income, if you do those three things, 77 percent chance of being above the median income. Why isn't the president of the United States, or why aren't leaders in this country, talking about that and trying to formulate, not necessarily federal government policy...

MR. GREGORY: Let...

FMR. SEN. SANTORUM: ...but local policy and state policy and community policy to help people do those things that we know work and we know are good for society? This president doesn't. In fact, he has required...

MR. GREGORY: All right. Let me...

Visit msnbc.com for breaking news, world news, and news about the economy

FMR. SEN. SANTORUM: ...programs not to talk about marriage, not to talk about abstinence, if, in order to get federal funds.

MR. GREGORY: Dr. Paul...

FMR. SEN. SANTORUM: He's working exactly against the things he knows works because he has a secular ideology that is against the traditions of our country and what works.

MR. GREGORY: Doc--Dr. Paul, quickly, how would you use the bully pulpit?

REP. PAUL: I would continue to do what I'm doing now, preaching the gospel of liberty. I think that the most important ingredients in this country that made us great was our founders understood what liberty meant, and that is what we need. We have deserted that. We have drifted a look way. It involves our right to our life, right to our liberty. We ought to be able to keep the fruits of our labor. We ought to understand property rights. We ought to understand contract rights. We ought to understand what sound money is all about, and we ought to understand what national defense means. That means defending this country. That is the bully pulpit we need. We need to defend liberty...
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MR. GREGORY: All right. Defend liberty and...

GOV. PERRY: Liberty.

REP. PAUL: And liberty.

MR. GREGORY: Thank you. We're going to take another break here. We'll be back with some closing moments right after this.

(Announcements)

MR. GREGORY: I would like to thank the candidates for joining us. I'd also like to thank our debate partners, Facebook, the New Hampshire Union Leader, and our host here, of course, in Concord, the Capitol Center for the Arts. Thank you, of course, for watching and participating in this debate online. Post debate analysis will continue on MSNBC. Be sure to watch complete coverage of the New Hampshire primary returns. That's Tuesday night on NBC News, MSNBC, and online at nbcpolitics.com.

Wednesday, October 8, 2008

Presidential Debate - Obama Vs. McCain - Full Video and Transcript


Belmont University
Nashville, Tennessee

This is a transcript of the second presidential debate between Republican nominee Senator John McCain and Democratic nominee Senator Barack Obama. The debate was moderated by Tom Brokaw of NBC.

BROKAW: Good evening from Belmont University in Nashville, Tennessee. I'm Tom Brokaw of NBC News. And welcome to this second presidential debate, sponsored by the Commission on Presidential Debates.

Tonight's debate is the only one with a town hall format. The Gallup Organization chose 80 uncommitted voters from the Nashville area to be here with us tonight. And earlier today, each of them gave me a copy of their question for the candidates.

From all of these questions -- and from tens of thousands submitted online -- I have selected a long list of excellent questions on domestic and foreign policy.

Neither the commission nor the candidates have seen the questions. And although we won't be able to get to all of them tonight, we should have a wide-ranging discussion one month before the election.

Each candidate will have two minutes to respond to a common question, and there will be a one-minute follow-up. The audience here in the hall has agreed to be polite, and attentive, no cheering or outbursts. Those of you at home, of course, are not so constrained.

The only exception in the hall is right now, as it is my privilege to introduce the candidates, Sen. Barack Obama of Illinois and Sen. John McCain of Arizona.

Gentlemen?

Gentlemen, we want to get under way immediately, if we can. Since you last met at Ole Miss 12 days ago, the world has changed a great deal, and not for the better. We still don't know where the bottom is at this time.

As you might expect, many of the questions that we have from here in the hall tonight and from online have to do with the American economy and, in fact, with global economic conditions.

I understand that you flipped a coin.

And, Sen. Obama, you will begin tonight. And we're going to have our first question from over here in Section A from Alan Schaefer (ph).

Alan (ph)?

QUESTION: With the economy on the downturn and retired and older citizens and workers losing their incomes, what's the fastest, most positive solution to bail these people out of the economic ruin?

OBAMA: Well, Alan (ph), thank you very much for the question. I want to first, obviously, thank Belmont University, Tom, thank you, and to all of you who are participating tonight and those of you who sent e-mail questions in.

I think everybody knows now we are in the worst financial crisis since the Great Depression. And a lot of you I think are worried about your jobs, your pensions, your retirement accounts, your ability to send your child or your grandchild to college.

And I believe this is a final verdict on the failed economic policies of the last eight years, strongly promoted by President Bush and supported by Sen. McCain, that essentially said that we should strip away regulations, consumer protections, let the market run wild, and prosperity would rain down on all of us.

It hasn't worked out that way. And so now we've got to take some decisive action.

Now, step one was a rescue package that was passed last week. We've got to make sure that works properly. And that means strong oversight, making sure that investors, taxpayers are getting their money back and treated as investors.

It means that we are cracking down on CEOs and making sure that they're not getting bonuses or golden parachutes as a consequence of this package. And, in fact, we just found out that AIG, a company that got a bailout, just a week after they got help went on a $400,000 junket.

And I'll tell you what, the Treasury should demand that money back and those executives should be fired. But that's only step one. The middle-class need a rescue package. And that means tax cuts for the middle-class.

It means help for homeowners so that they can stay in their homes. It means that we are helping state and local governments set up road projects and bridge projects that keep people in their jobs.

And then long-term we've got to fix our health care system, we've got to fix our energy system that is putting such an enormous burden on families. You need somebody working for you and you've got to have somebody in Washington who is thinking about the middle class and not just those who can afford to hire lobbyists.

BROKAW: Sen. McCain?

MCCAIN: Well, thank you, Tom. Thank you, Belmont University. And Sen. Obama, it's good to be with you at a town hall meeting.

And, Alan (ph), thank you for your question. You go to the heart of America's worries tonight. Americans are angry, they're upset, and they're a little fearful. It's our job to fix the problem.

Now, I have a plan to fix this problem and it has got to do with energy independence. We've got to stop sending $700 billion a year to countries that don't want us very -- like us very much. We have to keep Americans' taxes low. All Americans' taxes low. Let's not raise taxes on anybody today.

We obviously have to stop this spending spree that's going on in Washington. Do you know that we've laid a $10 trillion debt on these young Americans who are here with us tonight, $500 billion of it we owe to China?

We've got to have a package of reforms and it has got to lead to reform prosperity and peace in the world. And I think that this problem has become so severe, as you know, that we're going to have to do something about home values.

You know that home values of retirees continues to decline and people are no longer able to afford their mortgage payments. As president of the United States, Alan, I would order the secretary of the treasury to immediately buy up the bad home loan mortgages in America and renegotiate at the new value of those homes -- at the diminished value of those homes and let people be able to make those -- be able to make those payments and stay in their homes.

Is it expensive? Yes. But we all know, my friends, until we stabilize home values in America, we're never going to start turning around and creating jobs and fixing our economy. And we've got to give some trust and confidence back to America.

I know how the do that, my friends. And it's my proposal, it's not Sen. Obama's proposal, it's not President Bush's proposal. But I know how to get America working again, restore our economy and take care of working Americans. Thank you.

BROKAW: Senator, we have one minute for a discussion here. Obviously the powers of the treasury secretary have been greatly expanded. The most powerful officer in the cabinet now. Hank Paulson says he won't stay on. Who do you have in mind to appoint to that very important post?

Sen. McCain?

MCCAIN: Not you, Tom.

BROKAW: No, with good reason.

MCCAIN: You know, that's a tough question and there's a lot of qualified Americans. But I think the first criteria, Tom, would have to be somebody who immediately Americans identify with, immediately say, we can trust that individual.

A supporter of Sen. Obama's is Warren Buffett [chairman of Berkshire Hathaway]. He has already weighed in and helped stabilize some of the difficulties in the markets and with companies and corporations, institutions today.

I like Meg Whitman [former CEO of eBay and current McCain campaign adviser], she knows what it's like to be out there in the marketplace. She knows how to create jobs. Meg Whitman was CEO of a company that started with 12 people and is now 1.3 million people in America make their living off eBay. Maybe somebody here has done a little business with them.

But the point is it's going to have to be somebody who inspires trust and confidence. Because the problem in America today to a large extent, Tom, is that we don't have trust and confidence in our institutions because of the corruption on Wall Street and the greed and excess and the cronyism in Washington, D.C.

BROKAW: All right. Sen. McCain -- Sen. Obama, who do you have in mind for treasury secretary?

OBAMA: Well, Warren would be a pretty good choice -- Warren Buffett, and I'm pleased to have his support. But there are other folks out there. The key is making sure that the next treasury secretary understands that it's not enough just to help those at the top.

Prosperity is not just going to trickle down. We've got to help the middle class.

And we've -- you know, Sen. McCain and I have some fundamental disagreements on the economy, starting with Sen. McCain's statement earlier that he thought the fundamentals of the economy were sound.

Part of the problem here is that for many of you, wages and incomes have flat-lined. For many of you, it is getting harder and harder to save, harder and harder to retire.

And that's why, for example, on tax policy, what I want to do is provide a middle class tax cut to 95 percent of working Americans, those who are working two jobs, people who are not spending enough time with their kids, because they are struggling to make ends meet.

Sen. McCain is right that we've got to stabilize housing prices. But underlying that is loss of jobs and loss of income. That's something that the next treasury secretary is going to have to work on.

BROKAW: Sen. Obama, thank you very much.

May I remind both of you, if I can, that we're operating under rules that you signed off on and when we have a discussion, it really is to be confined within about a minute or so.

We're going to go now, Sen. McCain, to the next question from you from the hall here, and it comes from Oliver Clark (ph), who is over here in section F.

Oliver?

QUESTION: Well, Senators, through this economic crisis, most of the people that I know have had a difficult time. And through this bailout package, I was wondering what it is that's going to actually help those people out.

MCCAIN: Well, thank you, Oliver, and that's an excellent question, because as you just described it, bailout, when I believe that it's rescue, because -- because of the greed and excess in Washington and Wall Street, Main Street was paying a very heavy price, and we know that.

I left my campaign and suspended it to go back to Washington to make sure that there were additional protections for the taxpayer in the form of good oversight, in the form of taxpayers being the first to be paid back when our economy recovers -- and it will recover -- and a number of other measures.

But you know, one of the real catalysts, really the match that lit this fire was Fannie Mae and Freddie Mac. I'll bet you, you may never even have heard of them before this crisis.

But you know, they're the ones that, with the encouragement of Sen. Obama and his cronies and his friends in Washington, that went out and made all these risky loans, gave them to people that could never afford to pay back.

And you know, there were some of us that stood up two years ago and said we've got to enact legislation to fix this. We've got to stop this greed and excess.

Meanwhile, the Democrats in the Senate and some -- and some members of Congress defended what Fannie and Freddie were doing. They resisted any change.

Meanwhile, they were getting all kinds of money in campaign contributions. Sen. Obama was the second highest recipient of Fannie Mae and Freddie Mac money in history -- in history.

So this rescue package means that we will stabilize markets, we will shore up these institutions. But it's not enough. That's why we're going to have to go out into the housing market and we're going to have to buy up these bad loans and we're going to have to stabilize home values, and that way, Americans, like Alan, can realize the American dream and stay in their home.

But Fannie and Freddie were the catalysts, the match that started this forest fire. There were some of us -- there were some of us that stood up against it. There were others who took a hike.

BROKAW: Sen. Obama?

OBAMA: Well, Oliver, first, let me tell you what's in the rescue package for you. Right now, the credit markets are frozen up and what that means, as a practical matter, is that small businesses and some large businesses just can't get loans.

If they can't get a loan, that means that they can't make payroll. If they can't make payroll, then they may end up having to shut their doors and lay people off.

And if you imagine just one company trying to deal with that, now imagine a million companies all across the country.

So it could end up having an adverse effect on everybody, and that's why we had to take action. But we shouldn't have been there in the first place.

Now, I've got to correct a little bit of Sen. McCain's history, not surprisingly. Let's, first of all, understand that the biggest problem in this whole process was the deregulation of the financial system.

Sen. McCain, as recently as March, bragged about the fact that he is a deregulator. On the other hand, two years ago, I said that we've got a sub-prime lending crisis that has to be dealt with.

I wrote to Secretary Paulson, I wrote to Federal Reserve Chairman [Ben] Bernanke, and told them this is something we have to deal with, and nobody did anything about it.

A year ago, I went to Wall Street and said we've got to reregulate, and nothing happened.

And Sen. McCain during that period said that we should keep on deregulating because that's how the free enterprise system works.

Now, with respect to Fannie Mae, what Sen. McCain didn't mention is the fact that this bill that he talked about wasn't his own bill. He jumped on it a year after it had been introduced and it never got passed.

And I never promoted Fannie Mae. In fact, Sen. McCain's campaign chairman's firm was a lobbyist on behalf of Fannie Mae, not me.

So -- but, look, you're not interested in hearing politicians pointing fingers. What you're interested in is trying to figure out, how is this going to impact you?

This is not the end of the process; this is the beginning of the process. And that's why it's going to be so important for us to work with homeowners to make sure that they can stay in their homes.

The secretary already has the power to do that in the rescue package, but it hasn't been exercised yet. And the next president has to make sure that the next Treasury secretary is thinking about how to strengthen you as a home buyer, you as a homeowner, and not simply think about bailing out banks on Wall Street.

BROKAW: Sen. Obama, time for a discussion. I'm going to begin with you. Are you saying to Mr. Clark (ph) and to the other members of the American television audience that the American economy is going to get much worse before it gets better and they ought to be prepared for that?

OBAMA: No, I am confident about the American economy. But we are going to have to have some leadership from Washington that not only sets out much better regulations for the financial system.

The problem is we still have a archaic, 20th-century regulatory system for 21st-century financial markets. We're going to have to coordinate with other countries to make sure that whatever actions we take work.

But most importantly, we're going to have to help ordinary families be able to stay in their homes, make sure that they can pay their bills, deal with critical issues like health care and energy, and we're going to have to change the culture in Washington so that lobbyists and special interests aren't driving the process and your voices aren't being drowned out.

BROKAW: Sen. McCain, in all candor, do you think the economy is going to get worse before it gets better?

MCCAIN: I think it depends on what we do. I think if we act effectively, if we stabilize the housing market -- which I believe we can, if we go out and buy up these bad loans, so that people can have a new mortgage at the new value of their home -- I think if we get rid of the cronyism and special interest influence in Washington so we can act more effectively.

My friend, I'd like you to see the letter that a group of senators and I wrote warning exactly of this crisis. Sen. Obama's name was not on that letter.

The point is -- the point is that we can fix our economy. Americans' workers are the best in the world. They're the fundamental aspect of America's economy.

They're the most innovative. They're the best -- they're most -- have best -- we're the best exporters. We're the best importers. They're most effective. They are the best workers in the world.

And we've got to give them a chance. They've got -- we've got to give them a chance to do their best again. And they are the innocent bystanders here in what is the biggest financial crisis and challenge of our time. We can do it.

BROKAW: Thank you, Sen. McCain.

We're going to continue over in Section F, as it turns out.

Sen. Obama, this is a question from you from Theresa Finch (ph).

Theresa (ph)?

QUESTION: How can we trust either of you with our money when both parties got -- got us into this global economic crisis?

OBAMA: Well, look, I understand your frustration and your cynicism, because while you've been carrying out your responsibilities -- most of the people here, you've got a family budget. If less money is coming in, you end up making cuts. Maybe you don't go out to dinner as much. Maybe you put off buying a new car.

That's not what happens in Washington. And you're right. There is a lot of blame to go around.

But I think it's important just to remember a little bit of history. When George Bush came into office, we had surpluses. And now we have half-a-trillion-dollar deficit annually.

When George Bush came into office, our debt -- national debt was around $5 trillion. It's now over $10 trillion. We've almost doubled it.

And so while it's true that nobody's completely innocent here, we have had over the last eight years the biggest increases in deficit spending and national debt in our history. And Sen. McCain voted for four out of five of those George Bush budgets.

So here's what I would do. I'm going to spend some money on the key issues that we've got to work on.

You know, you may have seen your health care premiums go up. We've got to reform health care to help you and your budget.

We are going to have to deal with energy because we can't keep on borrowing from the Chinese and sending money to Saudi Arabia. We are mortgaging our children's future. We've got to have a different energy plan.

We've got to invest in college affordability. So we're going to have to make some investments, but we've also got to make spending cuts. And what I've proposed, you'll hear Sen. McCain say, well, he's proposing a whole bunch of new spending, but actually I'm cutting more than I'm spending so that it will be a net spending cut.

The key is whether or not we've got priorities that are working for you as opposed to those who have been dictating the policy in Washington lately, and that's mostly lobbyists and special interests. We've got to put an end to that.

BROKAW: Sen. McCain?

MCCAIN: Well, Theresa (ph), thank you. And I can see why you feel that cynicism and mistrust, because the system in Washington is broken. And I have been a consistent reformer.

I have advocated and taken on the special interests, whether they be the big money people by reaching across the aisle and working with Sen. [Russ] Feingold [D-Wisconsin] on campaign finance reform, whether it being a variety of other issues, working with Sen. Lieberman on trying to address climate change.

I have a clear record of bipartisanship. The situation today cries out for bipartisanship. Sen. Obama has never taken on his leaders of his party on a single issue. And we need to reform.

And so let's look at our records as well as our rhetoric. That's really part of your mistrust here. And now I suggest that maybe you go to some of these organizations that are the watchdogs of what we do, like the Citizens Against Government Waste or the National Taxpayers Union or these other organizations that watch us all the time.

I don't expect you to watch every vote. And you know what you'll find? This is the most liberal big-spending record in the United States Senate. I have fought against excessive spending and outrages. I have fought to reduce the earmarks and eliminate them.

Do you know that Sen. Obama has voted for -- is proposing $860 billion of new spending now? New spending. Do you know that he voted for every increase in spending that I saw come across the floor of the United States Senate while we were working to eliminate these pork barrel earmarks?

He voted for nearly a billion dollars in pork barrel earmark projects, including, by the way, $3 million for an overhead projector at a planetarium in Chicago, Illinois. My friends, do we need to spend that kind of money?

I think you have to look at my record and you have to look at his. Then you have to look at our proposals for our economy, not $860 billion in new spending, but for the kinds of reforms that keep people in their jobs, get middle-income Americans working again, and getting our economy moving again.

You're going to be examining our proposals tonight and in the future, and energy independence is a way to do that, is one of them. And drilling offshore and nuclear power are two vital elements of that. And I've been supporting those and I know how to fix this economy, and eliminate our dependence on foreign oil, and stop sending $700 billion a year overseas.

BROKAW: We've run out of time. We have this one-minute discussion period going on here.

There are new economic realities out there that everyone in this hall and across this country understands that there are going to have to be some choices made. Health policies, energy policies, and entitlement reform, what are going to be your priorities in what order? Which of those will be your highest priority your first year in office and which will follow in sequence?

Sen. McCain?

MCCAIN: The three priorities were health...

BROKAW: The three -- health care, energy, and entitlement reform: Social Security and Medicare. In what order would you put them in terms of priorities?

MCCAIN: I think you can work on all three at once, Tom. I think it's very important that reform our entitlement programs.

My friends, we are not going to be able to provide the same benefit for present-day workers that we are going -- that present-day retirees have today. We're going to have to sit down across the table, Republican and Democrat, as we did in 1983 between Ronald Reagan and Tip O'Neill.

I know how to do that. I have a clear record of reaching across the aisle, whether it be Joe Lieberman or Russ Feingold or Ted Kennedy or others. That's my clear record.

We can work on nuclear power plants. Build a whole bunch of them, create millions of new jobs. We have to have all of the above, alternative fuels, wind, tide, solar, natural gas, clean coal technology. All of these things we can do as Americans and we can take on this mission and we can overcome it.

My friends, some of this $700 billion ends up in the hands of terrorist organizations.

As far as health care is concerned, obviously, everyone is struggling to make sure that they can afford their premiums and that they can have affordable and available health care. That's the next issue.

But we can do them all at once. There's no -- and we have to do them all at once. All three you mentioned are compelling national security requirements.

BROKAW: I'm trying to play by the rules that you all established. One minute for discussion.

Sen. Obama, if you would give us your list of priorities, there are some real questions about whether everything can be done at once.

OBAMA: We're going to have to prioritize, just like a family has to prioritize. Now, I've listed the things that I think have to be at the top of the list.

Energy we have to deal with today, because you're paying $3.80 here in Nashville for gasoline, and it could go up. And it's a strain on your family budget, but it's also bad for our national security, because countries like Russia and Venezuela and, you know, in some cases, countries like Iran, are benefiting from higher oil prices.

So we've got to deal with that right away. That's why I've called for an investment of $15 billion a year over 10 years. Our goal should be, in 10 year's time, we are free of dependence on Middle Eastern oil.

And we can do it. Now, when JFK said we're going to the Moon in 10 years, nobody was sure how to do it, but we understood that, if the American people make a decision to do something, it gets done. So that would be priority number one.

Health care is priority number two, because that broken health care system is bad not only for families, but it's making our businesses less competitive.

And, number three, we've got to deal with education so that our young people are competitive in a global economy.

But just one point I want to make, Tom. Sen. McCain mentioned looking at our records. We do need to look at our records.

Sen. McCain likes to talk about earmarks a lot. And that's important. I want to go line by line through every item in the federal budget and eliminate programs that don't work and make sure that those that do work, work better and cheaper.

But understand this: We also have to look at where some of our tax revenues are going. So when Sen. McCain proposes a $300 billion tax cut, a continuation not only of the Bush tax cuts, but an additional $200 billion that he's going to give to big corporations, including big oil companies, $4 billion worth, that's money out of the system.

And so we've got to prioritize both our spending side and our tax policies to make sure that they're working for you. That's what I'm going to do as president of the United States.

BROKAW: All right, gentlemen, I want to just remind you one more time about time. We're going to have a larger deficit than the federal government does if we don't get this under control here before too long.

Sen. McCain, for you, we have our first question from the Internet tonight. A child of the Depression, 78-year-old Fiora (ph) from Chicago.

Since World War II, we have never been asked to sacrifice anything to help our country, except the blood of our heroic men and women. As president, what sacrifices -- sacrifices will you ask every American to make to help restore the American dream and to get out of the economic morass that we're now in?

MCCAIN: Well, Fiora (ph), I'm going to ask the American people to understand that there are some programs that we may have to eliminate.

I first proposed a long time ago that we would have to examine every agency and every bureaucracy of government. And we're going to have to eliminate those that aren't working.

I know a lot of them that aren't working. One of them is in defense spending, because I've taken on some of the defense contractors. I saved the taxpayers $6.8 billion in a deal for an Air Force tanker that was done in a corrupt fashion.

I believe that we have to eliminate the earmarks. And sometimes those projects, not -- not the overhead projector that Sen. Obama asked for, but some of them that are really good projects, will have -- will have to be eliminated, as well.

And they'll have to undergo the same scrutiny that all projects should in competition with others.

So we're going to have to tell the American people that spending is going to have to be cut in America. And I recommend a spending freeze that -- except for defense, Veterans Affairs, and some other vital programs, we'll just have to have across-the-board freeze.

And some of those programs may not grow as much as we would like for them to, but we can establish priorities with full transparency, with full knowledge of the American people, and full consultation, not done behind closed doors and shoving earmarks in the middle of the night into programs that we don't even -- sometimes we don't even know about until months later.

And, by the way, I want to go back a second.

Look, we can attack health care and energy at the same time. We're not -- we're not -- we're not rifle shots here. We are Americans. We can, with the participation of all Americans, work together and solve these problems together.

Frankly, I'm not going to tell that person without health insurance that, "I'm sorry, you'll have to wait." I'm going to tell you Americans we'll get to work right away and we'll get to work together, and we can get them all done, because that's what America has been doing.

BROKAW: Sen. McCain, thank you very much.

Sen. Obama?

OBAMA: You know, a lot of you remember the tragedy of 9/11 and where you were on that day and, you know, how all of the country was ready to come together and make enormous changes to make us not only safer, but to make us a better country and a more unified country.

And President Bush did some smart things at the outset, but one of the opportunities that was missed was, when he spoke to the American people, he said, "Go out and shop."

That wasn't the kind of call to service that I think the American people were looking for.

And so it's important to understand that the -- I think the American people are hungry for the kind of leadership that is going to tackle these problems not just in government, but outside of government.

And let's take the example of energy, which we already spoke about. There is going to be the need for each and every one of us to start thinking about how we use energy.

I believe in the need for increased oil production. We're going to have to explore new ways to get more oil, and that includes offshore drilling. It includes telling the oil companies, that currently have 68 million acres that they're not using, that either you use them or you lose them.

We're going to have to develop clean coal technology and safe ways to store nuclear energy.

But each and every one of us can start thinking about how can we save energy in our homes, in our buildings. And one of the things I want to do is make sure that we're providing incentives so that you can buy a fuel efficient car that's made right here in the United States of America, not in Japan or South Korea, making sure that you are able to weatherize your home or make your business more fuel efficient.

And that's going to require effort from each and every one of us.

And the last point I just want to make. I think the young people of America are especially interested in how they can serve, and that's one of the reasons why I'm interested in doubling the Peace Corps, making sure that we are creating a volunteer corps all across this country that can be involved in their community, involved in military service, so that military families and our troops are not the only ones bearing the burden of renewing America.

That's something that all of us have to be involved with and that requires some leadership from Washington.

BROKAW: Sen. Obama, as we begin, very quickly, our discussion period, President Bush, you'll remember, last summer, said that "Wall Street got drunk."

A lot of people now look back and think the federal government got drunk and, in fact, the American consumers got drunk.

How would you, as president, try to break those bad habits of too much debt and too much easy credit, specifically, across the board, for this country, not just at the federal level, but as a model for the rest of the country, as well?

OBAMA: Well, I think it starts with Washington. We've got to show that we've got good habits, because if we're running up trillion dollar debts that we're passing on to the next generation, then a lot of people are going to think, "Well, you know what? There's easy money out there."

It means -- and I have to, again, repeat this. It means looking (ph) at the spending side, but also at the revenue side. I mean, Sen. McCain has been talking tough about earmarks, and that's good, but earmarks account for about $18 billion of our budget.

Now, when Sen. McCain is proposing tax cuts that would give the average Fortune 500 CEO an additional $700,000 in tax cuts, that's not sharing a burden.

And so part of the problem, I think, for a lot of people who are listening here tonight is they don't feel as if they are sharing the burden with other folks.

I mean, you know, it's tough to ask a teacher who's making $30,000 or $35,000 a year to tighten her belt when people who are making much more than her are living pretty high on the hog.

And that's why I think it's important for the president to set a tone that says all of us are going to contribute, all of us are going to make sacrifices, and it means that, yes, we may have to cut some spending, although I disagree with Sen. McCain about an across-the- board freeze.

That's an example of an unfair burden sharing. That's using a hatchet to cut the federal budget.

I want to use a scalpel so that people who need help are getting help and those of us, like myself and Sen. McCain, who don't need help, aren't getting it.

That's how we make sure that everybody is willing to make a few sacrifices.

BROKAW: Sen. McCain?

MCCAIN: Well, you know, nailing down Sen. Obama's various tax proposals is like nailing Jell-O to the wall. There has been five or six of them and if you wait long enough, there will probably be another one.

But he wants to raise taxes. My friends, the last president to raise taxes during tough economic times was Herbert Hoover, and he practiced protectionism as well, which I'm sure we'll get to at some point.

You know, last year up to this time, we've lost 700,000 jobs in America. The only bright spot is that over 300,000 jobs have been created by small businesses. Sen. Obama's secret that you don't know is that his tax increases will increase taxes on 50 percent of small business revenue.

Small businesses across America will have to cut jobs and will have their taxes increase and won't be able to hire because of Sen. Obama's tax policies. You know, he said some time ago, he said he would forgo his tax increases if the economy was bad.

I've got some news, Sen. Obama, the news is bad. So let's not raise anybody's taxes, my friends, and make it be very clear to you I am not in favor of tax cuts for the wealthy. I am in favor of leaving the tax rates alone and reducing the tax burden on middle-income Americans by doubling your tax exemption for every child from $3,500 to $7,000.

To giving every American a $5,000 refundable tax credit and go out and get the health insurance you want rather than mandates and fines for small businesses, as Sen. Obama's plan calls for. And let's create jobs and let's get our economy going again. And let's not raise anybody's taxes.

BROKAW: Sen. Obama, we have another question from the Internet.

OBAMA: Tom, can I respond to this briefly? Because...

BROKAW: Well, look, guys, the rules were established by the two campaigns, we worked very hard on this. This will address, I think, the next question.

OBAMA: The tax issue, because I think it's very important. Go ahead.

BROKAW: There are lots of issues that we are going to be dealing with here tonight. And we have a question from Langdon (ph) in Ballston Spa, New York, and that's about huge unfunded obligations for Social Security, Medicare, and other entitlement programs that will soon eat up all of the revenue that's in place and then go into a deficit position.

Since the rules are pretty loose here, I'm going to add my own to this one. Instead of having a discussion, let me ask you as a coda to that. Would you give Congress a date certain to reform Social Security and Medicare within two years after you take office? Because in a bipartisan way, everyone agrees, that's a big ticking time bomb that will eat us up maybe even more than the mortgage crisis.

OBAMA: Well, Tom, we're going to have to take on entitlements and I think we've got to do it quickly. We're going to have a lot of work to do, so I can't guarantee that we're going to do it in the next two years, but I'd like to do in the my first term as president.

But I think it's important to understand, we're not going to solve Social Security and Medicare unless we understand the rest of our tax policies. And you know, Sen. McCain, I think the "Straight Talk Express" lost a wheel on that one.

So let's be clear about my tax plan and Sen. McCain's, because we're not going to be able to deal with entitlements unless we understand the revenues coming in. I want to provide a tax cut for 95 percent of Americans, 95 percent.

If you make less than a quarter of a million dollars a year, you will not see a single dime of your taxes go up. If you make $200,000 a year or less, your taxes will go down.

Now, Sen. McCain talks about small businesses. Only a few percent of small businesses make more than $250,000 a year. So the vast majority of small businesses would get a tax cut under my plan.

And we provide a 50 percent tax credit so that they can buy health insurance for their workers, because there are an awful lot of small businesses that I meet across America that want to do right by their workers but they just can't afford it. Some small business owners, a lot of them, can't even afford health insurance for themselves.

Now, in contrast, Sen. McCain wants to give a $300 billion tax cut, $200 billion of it to the largest corporations and a hundred thousand of it -- a hundred billion of it going to people like CEOs on Wall Street.

He wants to give average Fortune 500 CEO an additional $700,000 in tax cuts. That is not fair. And it doesn't work.

Now, if we get our tax policies right so that they're good for the middle class, if we reverse the policies of the last eight years that got us into this fix in the first place and that Sen. McCain supported, then we are going to be in a position to deal with Social Security and deal with Medicare, because we will have a health care plan that actually works for you, reduces spending and costs over the long term, and Social Security that is stable and solvent for all Americans and not just some.

BROKAW: Sen. McCain, two years for a reform of entitlement programs?

MCCAIN: Sure. Hey, I'll answer the question. Look -- look, it's not that hard to fix Social Security, Tom. It's just...

BROKAW: And Medicare.

MCCAIN: ... tough decisions. I want to get to Medicare in a second.

Social Security is not that tough. We know what the problems are, my friends, and we know what the fixes are. We've got to sit down together across the table. It's been done before.

I saw it done with our -- our wonderful Ronald Reagan, a conservative from California, and the liberal Democrat Tip O'Neill from Massachusetts. That's what we need more of, and that's what I've done in Washington.

Sen. Obama has never taken on his party leaders on a single major issue. I've taken them on. I'm not too popular sometimes with my own party, much less his.

So Medicare, it's going to be a little tougher. It's going to be a little tougher because we're talking about very complex and difficult issues.

My friends, what we have to do with Medicare is have a commission, have the smartest people in America come together, come up with recommendations, and then, like the base-closing commission idea we had, then we should have Congress vote up or down.

Let's not let them fool with it anymore. There's too much special interests and too many lobbyists working there. So let's have -- and let's have the American people say, "Fix it for us."

Now, just back on this -- on this tax, you know, again, it's back to our first question here about rhetoric and record. Sen. Obama has voted 94 times to either increase your taxes or against tax cuts. That's his record.

When he ran for the United States Senate from Illinois, he said he would have a middle-income tax cut. You know he came to the Senate and never once proposed legislation to do that?

So let's look at our record. I've fought higher taxes. I have fought excess spending. I have fought to reform government.

Let's look at our records, my friends, and then listen to my vision for the future of America. And we'll get our economy going again. And our best days are ahead of us.

BROKAW: Sen. McCain, thank you very much. I'm going to stick by my part of the pact and not ask a follow-up here.

The next question does come from the hall for Sen. McCain. It comes from Section C over here, and it's from Ingrid Jackson (ph).

Ingrid (ph)?

QUESTION: Sen. McCain, I want to know, we saw that Congress moved pretty fast in the face of an economic crisis. I want to know what you would do within the first two years to make sure that Congress moves fast as far as environmental issues, like climate change and green jobs?

MCCAIN: Well, thank you. Look, we are in tough economic times; we all know that. And let's keep -- never forget the struggle that Americans are in today.

But when we can -- when we have an issue that we may hand our children and our grandchildren a damaged planet, I have disagreed strongly with the Bush administration on this issue. I traveled all over the world looking at the effects of greenhouse gas emissions, Joe Lieberman and I.

And I introduced the first legislation, and we forced votes on it. That's the good news, my friends. The bad news is we lost. But we kept the debate going, and we kept this issue to -- to posing to Americans the danger that climate change opposes.

Now, how -- what's -- what's the best way of fixing it? Nuclear power. Sen. Obama says that it has to be safe or disposable or something like that.

Look, I -- I was on Navy ships that had nuclear power plants. Nuclear power is safe, and it's clean, and it creates hundreds of thousands of jobs.

And -- and I know that we can reprocess the spent nuclear fuel. The Japanese, the British, the French do it. And we can do it, too. Sen. Obama has opposed that.

We can move forward, and clean up our climate, and develop green technologies, and alternate -- alternative energies for -- for hybrid, for hydrogen, for battery-powered cars, so that we can clean up our environment and at the same time get our economy going by creating millions of jobs.

We can do that, we as Americans, because we're the best innovators, we're the best producers, and 95 percent of the people who are our market live outside of the United States of America.

BROKAW: Sen. Obama?

OBAMA: This is one of the biggest challenges of our times.

And it is absolutely critical that we understand this is not just a challenge, it's an opportunity, because if we create a new energy economy, we can create five million new jobs, easily, here in the United States.

It can be an engine that drives us into the future the same way the computer was the engine for economic growth over the last couple of decades.

And we can do it, but we're going to have to make an investment. The same way the computer was originally invented by a bunch of government scientists who were trying to figure out, for defense purposes, how to communicate, we've got to understand that this is a national security issue, as well.

And that's why we've got to make some investments and I've called for investments in solar, wind, geothermal. Contrary to what Sen. McCain keeps on saying, I favor nuclear power as one component of our overall energy mix.

But this is another example where I think it is important to look at the record. Sen. McCain and I actually agree on something. He said a while back that the big problem with energy is that for 30 years, politicians in Washington haven't done anything.

What Sen. McCain doesn't mention is he's been there 26 of them. And during that time, he voted 23 times against alternative fuels, 23 times.

So it's easy to talk about this stuff during a campaign, but it's important for us to understand that it requires a sustained effort from the next president.

One last point I want to make on energy. Sen. McCain talks a lot about drilling, and that's important, but we have three percent of the world's oil reserves and we use 25 percent of the world's oil.

So what that means is that we can't simply drill our way out of the problem. And we're not going to be able to deal with the climate crisis if our only solution is to use more fossil fuels that create global warming.

We're going to have to come up with alternatives, and that means that the United States government is working with the private sector to fund the kind of innovation that we can then export to countries like China that also need energy and are setting up one coal power plant a week.

We've got to make sure that we're giving them the energy that they need or helping them to create the energy that they need.

BROKAW: Gentlemen, you may not have noticed, but we have lights around here. They have red and green and yellow and they are to signal...

OBAMA: I'm just trying to keep up with John.

MCCAIN: Tom, wave like that and I'll look at you.

BROKAW: All right, Senator.

Here's a follow-up to that, one-minute discussion. It's a simple question.

MCCAIN: Sure.

BROKAW: Should we fund a Manhattan-like project that develops a nuclear bomb to deal with global energy and alternative energy or should we fund 100,000 garages across America, the kind of industry and innovation that developed Silicon Valley?

MCCAIN: I think pure research and development investment on the part of the United States government is certainly appropriate. I think once it gets into productive stages, that we ought to, obviously, turn it over to the private sector.

By the way, my friends, I know you grow a little weary with this back-and-forth. It was an energy bill on the floor of the Senate loaded down with goodies, billions for the oil companies, and it was sponsored by Bush and Cheney.

You know who voted for it? You might never know. That one. You know who voted against it? Me. I have fought time after time against these pork barrel -- these bills that come to the floor and they have all kinds of goodies and all kinds of things in them for everybody and they buy off the votes.

I vote against them, my friends. I vote against them. But the point is, also, on oil drilling, oil drilling offshore now is vital so that we can bridge the gap. We can bridge the gap between imported oil, which is a national security issue, as well as any other, and it will reduce the price of a barrel of oil, because when people know there's a greater supply, then the cost of that will go down.

That's fundamental economics. We've got to drill offshore, my friends, and we've got to do it now, and we can do it.

And as far as nuclear power is concerned, again, look at the record. Sen. Obama has approved storage and reprocessing of spent nuclear fuel.

And I'll stop, Tom, and you didn't even wave. Thanks.

BROKAW: Thank you very much, Senator.

Next question for you, Sen. Obama, and it comes from the E section over here and it's from Lindsey Trellow (ph).

Lindsey?

QUESTION: Senator, selling health care coverage in America as the marketable commodity has become a very profitable industry.

Do you believe health care should be treated as a commodity?

OBAMA: Well, you know, as I travel around the country, this is one of the single most frequently asked issues that I get, is the issue of health care. It is breaking family budgets. I can't tell you how many people I meet who don't have health insurance.

If you've got health insurance, most of you have seen your premiums double over the last eight years. And your co-payments and deductibles have gone up 30 percent just in the last year alone. If you're a small business, it's a crushing burden.

So one of the things that I have said from the start of this campaign is that we have a moral commitment as well as an economic imperative to do something about the health care crisis that so many families are facing.

So here's what I would do. If you've got health care already, and probably the majority of you do, then you can keep your plan if you are satisfied with it. You can keep your choice of doctor. We're going to work with your employer to lower the cost of your premiums by up to $2,500 a year.

And we're going to do it by investing in prevention. We're going to do it by making sure that we use information technology so that medical records are actually on computers instead of you filling forms out in triplicate when you go to the hospital. That will reduce medical errors and reduce costs.

If you don't have health insurance, you're going to be able to buy the same kind of insurance that Sen. McCain and I enjoy as federal employees. Because there's a huge pool, we can drop the costs. And nobody will be excluded for pre-existing conditions, which is a huge problem.

Now, Sen. McCain has a different kind of approach. He says that he's going to give you a $5,000 tax credit. What he doesn't tell you is that he is going to tax your employer-based health care benefits for the first time ever.

So what one hand giveth, the other hand taketh away. He would also strip away the ability of states to provide some of the regulations on insurance companies to make sure you're not excluded for pre-existing conditions or your mammograms are covered or your maternity is covered. And that is fundamentally the wrong way to go.

In fact, just today business organizations like the United States Chamber of Commerce, which generally are pretty supportive of Republicans, said that this would lead to the unraveling of the employer-based health care system.

That, I don't think, is the kind of change that we need. We've got to have somebody who is fighting for patients and making sure that you get decent, affordable health care. And that's something that I'm committed to doing as president.

BROKAW: Sen. McCain?

MCCAIN: Well, thank you for the question. You really identified one of the really major challenges that America faces. Co-payments go up, costs go up, skyrocketing costs, which make people less and less able to afford health insurance in America.

And we need to do all of the things that are necessary to make it more efficient. Let's put health records online, that will reduce medical errors, as they call them. Let's have community health centers. Let's have walk-in clinics. Let's do a lot of things to impose efficiencies.

But what is at stake here in this health care issue is the fundamental difference between myself and Sen. Obama. As you notice, he starts talking about government. He starts saying, government will do this and government will do that, and then government will, and he'll impose mandates.

If you're a small business person and you don't insure your employees, Sen. Obama will fine you. Will fine you. That's remarkable. If you're a parent and you're struggling to get health insurance for your children, Sen. Obama will fine you.

I want to give every American a $5,000 refundable tax credit. They can take it anywhere, across state lines. Why not? Don't we go across state lines when we purchase other things in America? Of course it's OK to go across state lines because in Arizona they may offer a better plan that suits you best than it does here in Tennessee.

And if you do the math, those people who have employer-based health benefits, if you put the tax on it and you have what's left over and you add $5,000 that you're going to get as a refundable tax credit, do the math, 95 percent of the American people will have increased funds to go out and buy the insurance of their choice and to shop around and to get -- all of those people will be covered except for those who have these gold-plated Cadillac kinds of policies.

You know, like hair transplants, I might need one of those myself. But the point is that we have got to give people choice in America and not mandate things on them and give them the ability. Every parent I know would acquire health insurance for their children if they could.

Obviously small business people want to give their employees health insurance. Of course they all want to do that. We've got to give them the wherewithal to do it. We can do it by giving them, as a start, a $5,000 refundable tax credit to go around and get the health insurance policy of their choice.

BROKAW: Quick discussion. Is health care in America a privilege, a right, or a responsibility?

Sen. McCain?

MCCAIN: I think it's a responsibility, in this respect, in that we should have available and affordable health care to every American citizen, to every family member. And with the plan that -- that I have, that will do that.

But government mandates I -- I'm always a little nervous about. But it is certainly my responsibility. It is certainly small-business people and others, and they understand that responsibility. American citizens understand that. Employers understand that.

But they certainly are a little nervous when Sen. Obama says, if you don't get the health care policy that I think you should have, then you're going to get fined. And, by the way, Sen. Obama has never mentioned how much that fine might be. Perhaps we might find that out tonight.

OBAMA: Well, why don't -- why don't -- let's talk about this, Tom, because there was just a lot of stuff out there.

BROKAW: Privilege, right or responsibility. Let's start with that.

OBAMA: Well, I think it should be a right for every American. In a country as wealthy as ours, for us to have people who are going bankrupt because they can't pay their medical bills -- for my mother to die of cancer at the age of 53 and have to spend the last months of her life in the hospital room arguing with insurance companies because they're saying that this may be a pre-existing condition and they don't have to pay her treatment, there's something fundamentally wrong about that.

So let me -- let me just talk about this fundamental difference. And, Tom, I know that we're under time constraints, but Sen. McCain through a lot of stuff out there.

Number one, let me just repeat, if you've got a health care plan that you like, you can keep it. All I'm going to do is help you to lower the premiums on it. You'll still have choice of doctor. There's no mandate involved.

Small businesses are not going to have a mandate. What we're going to give you is a 50 percent tax credit to help provide health care for those that you need.

Now, it's true that I say that you are going to have to make sure that your child has health care, because children are relatively cheap to insure and we don't want them going to the emergency room for treatable illnesses like asthma.

And when Sen. McCain says that he wants to provide children health care, what he doesn't mention is he voted against the expansion of the Children's Health Insurance Program that is responsible for making sure that so many children who didn't have previously health insurance have it now.

Now, the final point I'll make on this whole issue of government intrusion and mandates -- it is absolutely true that I think it is important for government to crack down on insurance companies that are cheating their customers, that don't give you the fine print, so you end up thinking that you're paying for something and, when you finally get sick and you need it, you're not getting it.

And the reason that it's a problem to go shopping state by state, you know what insurance companies will do? They will find a state -- maybe Arizona, maybe another state -- where there are no requirements for you to get cancer screenings, where there are no requirements for you to have to get pre-existing conditions, and they will all set up shop there.

That's how in banking it works. Everybody goes to Delaware, because they've got very -- pretty loose laws when it comes to things like credit cards.

And in that situation, what happens is, is that the protections you have, the consumer protections that you need, you're not going to have available to you.

That is a fundamental difference that I have with Sen. McCain. He believes in deregulation in every circumstance. That's what we've been going through for the last eight years. It hasn't worked, and we need fundamental change.

BROKAW: Sen., we want to move on now. If we'd come back to the hall here, we're going to shift gears here a little bit and we're going to go to foreign policy and international matters, if we can...

MCCAIN: I don't believe that -- did we hear the size of the fine?

BROKAW: Phil Elliott (ph) is over here in this section, and Phil Elliott (ph) has a question for Sen. McCain.

Phil?

QUESTION: Yes. Sen. McCain, how will all the recent economic stress affect our nation's ability to act as a peacemaker in the world?

MCCAIN: Well, I thank you for that question, because there's no doubt that history shows us that nations that are strong militarily over time have to have a strong economy, as well. And that is one of the challenges that America faces.

But having said that, America -- and we'll hear a lot of criticism. I've heard a lot of criticism about America, and our national security policy, and all that, and much of that criticism is justified.

But the fact is, America is the greatest force for good in the history of the world. My friends, we have gone to all four corners of the Earth and shed American blood in defense, usually, of somebody else's freedom and our own.

So we are peacemakers and we're peacekeepers. But the challenge is to know when the United States of American can beneficially effect the outcome of a crisis, when to go in and when not, when American military power is worth the expenditure of our most precious treasure.

And that question can only be answered by someone with the knowledge and experience and the judgment, the judgment to know when our national security is not only at risk, but where the United States of America can make a difference in preventing genocide, in preventing the spread of terrorism, in doing the things that the United States has done, not always well, but we've done because we're a nation of good.

And I am convinced that my record, going back to my opposition from sending the Marines to Lebanon, to supporting our efforts in Kosovo and Bosnia and the first Gulf War, and my judgment, I think, is something that I'm -- a record that I'm willing to stand on.

Sen. Obama was wrong about Iraq and the surge. He was wrong about Russia when they committed aggression against Georgia. And in his short career, he does not understand our national security challenges.

We don't have time for on-the-job training, my friends.

BROKAW: Sen. Obama, the economic constraints on the U.S. military action around the world.

OBAMA: Well, you know, Sen. McCain, in the last debate and today, again, suggested that I don't understand. It's true. There are some things I don't understand.

I don't understand how we ended up invading a country that had nothing to do with 9/11, while Osama Bin Laden and Al Qaeda are setting up base camps and safe havens to train terrorists to attack us.

That was Sen. McCain's judgment and it was the wrong judgment.

When Sen. McCain was cheerleading the president to go into Iraq, he suggested it was going to be quick and easy, we'd be greeted as liberators.

That was the wrong judgment, and it's been costly to us.

So one of the difficulties with Iraq is that it has put an enormous strain, first of all, on our troops, obviously, and they have performed heroically and honorably and we owe them an extraordinary debt of gratitude.

But it's also put an enormous strain on our budget. We've spent, so far, close to $700 billion and if we continue on the path that we're on, as Sen. McCain is suggesting, it's going to go well over $1 trillion.

We're spending $10 billion a month in Iraq at a time when the Iraqis have a $79 billion surplus, $79 billion.

And we need that $10 billion a month here in the United States to put people back to work, to do all these wonderful things that Sen. McCain suggested we should be doing, but has not yet explained how he would pay for.

Now, Sen. McCain and I do agree, this is the greatest nation on earth. We are a force of good in the world. But there has never been a nation in the history of the world that saw its economy decline and maintained its military superiority.

And the strains that have been placed on our alliances around the world and the respect that's been diminished over the last eight years has constrained us being able to act on something like the genocide in Darfur, because we don't have the resources or the allies to do everything that we should be doing.

That's going to change when I'm president, but we can't change it unless we fundamentally change Sen. McCain's and George Bush's foreign policy. It has not worked for America.

BROKAW: Sen. Obama, let me ask you if -- let's see if we can establish tonight the Obama doctrine and the McCain doctrine for the use of United States combat forces in situations where there's a humanitarian crisis, but it does not affect our national security.

Take the Congo, where 4.5 million people have died since 1998, or take Rwanda in the earlier dreadful days, or Somalia.

What is the Obama doctrine for use of force that the United States would send when we don't have national security issues at stake?

OBAMA: Well, we may not always have national security issues at stake, but we have moral issues at stake.

If we could have intervened effectively in the Holocaust, who among us would say that we had a moral obligation not to go in?

If we could've stopped Rwanda, surely, if we had the ability, that would be something that we would have to strongly consider and act.

So when genocide is happening, when ethnic cleansing is happening somewhere around the world and we stand idly by, that diminishes us.

And so I do believe that we have to consider it as part of our interests, our national interests, in intervening where possible.

But understand that there's a lot of cruelty around the world. We're not going to be able to be everywhere all the time. That's why it's so important for us to be able to work in concert with our allies.

Let's take the example of Darfur just for a moment. Right now there's a peacekeeping force that has been set up and we have African Union troops in Darfur to stop a genocide that has killed hundreds of thousands of people.

We could be providing logistical support, setting up a no-fly zone at relatively little cost to us, but we can only do it if we can help mobilize the international community and lead. And that's what I intend to do when I'm president.

BROKAW: Sen. McCain, the McCain Doctrine, if you will.

MCCAIN: Well, let me just follow up, my friends. If we had done what Sen. Obama wanted done in Iraq, and that was set a date for withdrawal, which Gen. [David] Petraeus, our chief -- chairman of our Joint Chiefs of Staff said would be a very dangerous course to take for America, then we would have had a wider war, we would have been back, Iranian influence would have increased, al Qaeda would have re- established a base.

There was a lot at stake there, my friends. And I can tell you right now that Sen. Obama would have brought our troops home in defeat. I'll bring them home with victory and with honor and that is a fundamental difference.

The United States of America, Tom, is the greatest force for good, as I said. And we must do whatever we can to prevent genocide, whatever we can to prevent these terrible calamities that we have said never again.

But it also has to be tempered with our ability to beneficially affect the situation. That requires a cool hand at the tiller. This requires a person who understands what our -- the limits of our capability are.

We went in to Somalia as a peacemaking organization, we ended up trying to be -- excuse me, as a peacekeeping organization, we ended up trying to be peacemakers and we ended up having to withdraw in humiliation.

In Lebanon, I stood up to President Reagan, my hero, and said, if we send Marines in there, how can we possibly beneficially affect this situation? And said we shouldn't. Unfortunately, almost 300 brave young Marines were killed.

So you have to temper your decisions with the ability to beneficially affect the situation and realize you're sending America's most precious asset, American blood, into harm's way. And, again, I know those situations.

I've been in them all my life. And I can tell you right now the security of your young men and women who are serving in the military are my first priority right after our nation's security.

And I may have to make those tough decisions. But I won't take them lightly. And I understand that we have to say never again to a Holocaust and never again to Rwanda. But we had also better be darn sure we don't leave and make the situation worse, thereby exacerbating our reputation and our ability to address crises in other parts of the world.

BROKAW: Sen. McCain, thank you very much.

Next question for Sen. Obama, it comes from the F section and is from Katie Hamm (ph). Katie?

QUESTION: Should the United States respect Pakistani sovereignty and not pursue al Qaeda terrorists who maintain bases there, or should we ignore their borders and pursue our enemies like we did in Cambodia during the Vietnam War?

OBAMA: Katie, it's a terrific question and we have a difficult situation in Pakistan. I believe that part of the reason we have a difficult situation is because we made a bad judgment going into Iraq in the first place when we hadn't finished the job of hunting down bin Laden and crushing al Qaeda.

So what happened was we got distracted, we diverted resources, and ultimately bin Laden escaped, set up base camps in the mountains of Pakistan in the northwest provinces there.

They are now raiding our troops in Afghanistan, destabilizing the situation. They're stronger now than at any time since 2001. And that's why I think it's so important for us to reverse course, because that's the central front on terrorism.

They are plotting to kill Americans right now. As Secretary Gates, the defense secretary, said, the war against terrorism began in that region and that's where it will end. So part of the reason I think it's so important for us to end the war in Iraq is to be able to get more troops into Afghanistan, put more pressure on the Afghan government to do what it needs to do, eliminate some of the drug trafficking that's funding terrorism.

But I do believe that we have to change our policies with Pakistan. We can't coddle, as we did, a dictator, give him billions of dollars and then he's making peace treaties with the Taliban and militants.

What I've said is we're going to encourage democracy in Pakistan, expand our nonmilitary aid to Pakistan so that they have more of a stake in working with us, but insisting that they go after these militants.

And if we have Osama bin Laden in our sights and the Pakistani government is unable or unwilling to take them out, then I think that we have to act and we will take them out. We will kill bin Laden; we will crush Al Qaeda. That has to be our biggest national security priority.

BROKAW: Sen. McCain?

MCCAIN: Well, Katie (ph), thank you.

You know, my hero is a guy named Teddy Roosevelt. Teddy Roosevelt used to say walk softly -- talk softly, but carry a big stick. Sen. Obama likes to talk loudly.

In fact, he said he wants to announce that he's going to attack Pakistan. Remarkable.

You know, if you are a country and you're trying to gain the support of another country, then you want to do everything you can that they would act in a cooperative fashion.

When you announce that you're going to launch an attack into another country, it's pretty obvious that you have the effect that it had in Pakistan: It turns public opinion against us.

Now, let me just go back with you very briefly. We drove the Russians out with -- the Afghan freedom fighters drove the Russians out of Afghanistan, and then we made a most serious mistake. We washed our hands of Afghanistan. The Taliban came back in, Al Qaeda, we then had the situation that required us to conduct the Afghan war.

Now, our relations with Pakistan are critical, because the border areas are being used as safe havens by the Taliban and Al Qaeda and other extremist organizations, and we have to get their support.

Now, General Petraeus had a strategy, the same strategy -- very, very different, because of the conditions and the situation -- but the same fundamental strategy that succeeded in Iraq. And that is to get the support of the people.

We need to help the Pakistani government go into Waziristan, where I visited, a very rough country, and -- and get the support of the people, and get them to work with us and turn against the cruel Taliban and others.

And by working and coordinating our efforts together, not threatening to attack them, but working with them, and where necessary use force, but talk softly, but carry a big stick.

OBAMA: Tom, just a...

BROKAW: Sen. McCain...

OBAMA: ... just a quick follow-up on this. I think...

MCCAIN: If we're going to have follow-ups, then I will want follow-ups, as well.

BROKAW: No, I know. So but I think we get at it...

MCCAIN: It'd be fine with me. It'd be fine with me.

BROKAW: ... if I can, with this question.

OBAMA: Then let's have one.

BROKAW: All right, let's have a follow-up.

MCCAIN: It'd be fine with me.

OBAMA: Just -- just -- just a quick follow-up, because I think -- I think this is important.

BROKAW: I'm just the hired help here, so, I mean...

OBAMA: You're doing a great job, Tom.

Look, I -- I want to be very clear about what I said. Nobody called for the invasion of Pakistan. Sen. McCain continues to repeat this.

What I said was the same thing that the audience here today heard me say, which is, if Pakistan is unable or unwilling to hunt down bin Laden and take him out, then we should.

Now, that I think has to be our policy, because they are threatening to kill more Americans.

Now, Sen. McCain suggests that somehow, you know, I'm green behind the ears and, you know, I'm just spouting off, and he's somber and responsible.

MCCAIN: Thank you very much.

OBAMA: Sen. McCain, this is the guy who sang, "Bomb, bomb, bomb Iran," who called for the annihilation of North Korea. That I don't think is an example of "speaking softly."

This is the person who, after we had -- we hadn't even finished Afghanistan, where he said, "Next up, Baghdad."

So I agree that we have to speak responsibly and we have to act responsibly. And the reason Pakistan -- the popular opinion of America had diminished in Pakistan was because we were supporting a dictator, Musharraf, had given him $10 billion over seven years, and he had suspended civil liberties. We were not promoting democracy.

This is the kind of policies that ultimately end up undermining our ability to fight the war on terrorism, and it will change when I'm president.

MCCAIN: And, Tom, if -- if we're going to go back and forth, I then -- I'd like to have equal time to go -- to respond to...

BROKAW: Yes, you get the...

MCCAIN: ... to -- to -- to...

BROKAW: ... last word here, and then we have to move on.

MCCAIN: Not true. Not true. I have, obviously, supported those efforts that the United States had to go in militarily and I have opposed that I didn't think so.

I understand what it's like to send young American's in harm's way. I say -- I was joking with a veteran -- I hate to even go into this. I was joking with an old veteran friend, who joked with me, about Iran.

But the point is that I know how to handle these crises. And Sen. Obama, by saying that he would attack Pakistan, look at the context of his words. I'll get Osama bin Laden, my friends. I'll get him. I know how to get him.

I'll get him no matter what and I know how to do it. But I'm not going to telegraph my punches, which is what Sen. Obama did. And I'm going to act responsibly, as I have acted responsibly throughout my military career and throughout my career in the United States Senate.

And we have fundamental disagreements about the use of military power and how you do it, and you just saw it in response to previous questions.

BROKAW: Can I get a quick response from the two of you about developments in Afghanistan this week? The senior British military commander, who is now leading there for a second tour, and their senior diplomatic presence there, Sherard Cowper-Coles, who is well known as an expert in the area, both have said that we're failing in Afghanistan.

The commander said we cannot win there. We've got to get it down to a low level insurgency, let the Afghans take it over. Cowper-Coles said what we need is an acceptable dictator.

If either of you becomes president, as one of you will, how do you reorganize Afghanistan's strategy or do you? Briefly, if you can.

OBAMA: I'll be very brief. We are going to have to make the Iraqi government start taking more responsibility, withdraw our troops in a responsible way over time, because we're going to have to put some additional troops in Afghanistan.

Gen. [David] McKiernan, the commander in Afghanistan right now, is desperate for more help, because our bases and outposts are now targets for more aggressive Afghan -- Taliban offenses.

We're also going to have to work with the Karzai government, and when I met with President Karzai, I was very clear that, "You are going to have to do better by your people in order for us to gain the popular support that's necessary."

I don't think he has to be a dictator. And we want a democracy in Afghanistan. But we have to have a government that is responsive to the Afghan people, and, frankly, it's just not responsive right now.

BROKAW: Sen. McCain, briefly.

MCCAIN: Gen. Petraeus has just taken over a position of responsibility, where he has the command and will really set the tone for the strategy and tactics that are used.

And I've had conversations with him. It is the same overall strategy. Of course, we have to do some things tactically, some of which Sen. Obama is correct on.

We have to double the size of the Afghan army. We have to have a streamlined NATO command structure. We have to do a lot of things. We have to work much more closely with the Pakistanis.

But most importantly, we have to have the same strategy, which Sen. Obama said wouldn't work, couldn't work, still fails to admit that he was wrong about Iraq.

He still will not admit that he was wrong about the strategy of the surge in Iraq, and that's the same kind of strategy of go out and secure and hold and allow people to live normal lives.

And once they feel secure, then they lead normal, social, economic, political lives, the same thing that's happening in Iraq today.

So I have confidence that General Petraeus, working with the Pakistanis, working with the Afghans, doing the same job that he did in Iraq, will again. We will succeed and we will bring our troops home with honor and victory and not in defeat.

BROKAW: Sen. McCain, this question is for you from the Internet. It's from Alden (ph) in Hewitt, Texas.

How can we apply pressure to Russia for humanitarian issues in an effective manner without starting another Cold War?

MCCAIN: First of all, as I say, I don't think that -- we're not going to have another Cold War with Russia.

But have no doubt that Russia's behavior is certainly outside the norms of behavior that we would expect for nations which are very wealthy, as Russia has become, because of their petro dollars.

Now, long ago, I warned about Vladimir Putin. I said I looked into his eyes and saw three letters, a K, a G and a B. He has surrounded himself with former KGB apparatchiks. He has gradually repressed most of the liberties that we would expect for nations to observe, and he has exhibited most aggressive behavior, obviously, in Georgia.

I said before, watch Ukraine. Ukraine, right now, is in the sights of Vladimir Putin, those that want to reassemble the old Soviet Union.

We've got to show moral support for Georgia.

We've got to show moral support for Ukraine. We've got to advocate for their membership in NATO.

We have to make the Russians understand that there are penalties for these this kind of behavior, this kind of naked aggression into Georgia, a tiny country and a tiny democracy.

And so, of course we want to bring international pressures to bear on Russia in hopes that that will modify and eventually change their behavior. Now, the G-8 is one of those, but there are many others.

But the Russians must understand that these kinds of actions and activities are not acceptable and hopefully we will use the leverage, economic, diplomatic and others united with our allies, with our allies and friends in Europe who are equally disturbed as we are about their recent behaviors.

BROKAW: Sen. Obama.

MCCAIN: It will not be a re-ignition of the Cold War, but Russia is a challenge.

BROKAW: Sen. Obama? We're winding down, so if we can keep track of the time.

OBAMA: Well, the resurgence of Russia is one of the central issues that we're going to have to deal with in the next presidency. And for the most part I agree with Sen. McCain on many of the steps that have to be taken.

But we can't just provide moral support. We've got to provide moral support to the Poles and Estonia and Latvia and all of the nations that were former Soviet satellites. But we've also got to provide them with financial and concrete assistance to help rebuild their economies. Georgia in particular is now on the brink of enormous economic challenges. And some say that that's what Putin intended in the first place.

The other thing we have to do, though, is we've got to see around the corners. We've got to anticipate some of these problems ahead of time. You know, back in April, I put out a statement saying that the situation in Georgia was unsustainable because you had Russian peacekeepers in these territories that were under dispute.

And you knew that if the Russians themselves were trying to obtain some of these territories or push back against Georgia, that that was not a stable situation. So part of the job of the next commander-in-chief, in keeping all of you safe, is making sure that we can see some of the 21st Century challenges and anticipate them before they happen.

We haven't been doing enough of that. We tend to be reactive. That's what we've been doing over the last eight years and that has actually made us more safe. That's part of what happened in Afghanistan, where we rushed into Iraq and Sen. McCain and President Bush suggested that it wasn't that important to catch bin Laden right now and that we could muddle through, and that has cost us dearly.

We've got to be much more strategic if we're going to be able to deal with all of the challenges that we face out there.

And one last point I want to make about Russia. Energy is going to be key in dealing with Russia. If we can reduce our energy consumption, that reduces the amount of petro dollars that they have to make mischief around the world. That will strengthen us and weaken them when it comes to issues like Georgia.

BROKAW: This requires only a yes or a no. Ronald Reagan famously said that the Soviet Union was the evil empire. Do you think that Russia under Vladimir Putin is an evil empire?

OBAMA: I think they've engaged in an evil behavior and I think that it is important that we understand they're not the old Soviet Union but they still have nationalist impulses that I think are very dangerous.

BROKAW: Sen. McCain?

MCCAIN: Maybe.

BROKAW: Maybe.

MCCAIN: Depends on how we respond to Russia and it depends on a lot of things. If I say yes, then that means that we're reigniting the old Cold War. If I say no, it ignores their behavior.

Obviously energy is going to be a big, big factor. And Georgia and Ukraine are both major gateways of energy into Europe. And that's one of the reasons why it's in our interest.

But the Russians, I think we can deal with them but they've got to understand that they're facing a very firm and determined United States of America that will defend our interests and that of other countries in the world.

BROKAW: All right. We're going to try to get in two more questions, if we can. So we have to move along. Over in section A, Terry Chary (ph) -- do I have that right, Terry?

QUESTION: Senator, as a retired Navy chief, my thoughts are often with those who serve our country. I know both candidates, both of you, expressed support for Israel.

If, despite your best diplomatic efforts, Iran attacks Israel, would you be willing to commit U.S. troops in support and defense of Israel? Or would you wait on approval from the U.N. Security Council?

MCCAIN: Well, thank you, Terry (ph). And thank you for your service to the country.

I want to say, everything I ever learned about leadership I learned from a chief petty officer. And I thank you, and I thank you, my friend. Thanks for serving.

Let -- let -- let me say that we obviously would not wait for the United Nations Security Council. I think the realities are that both Russia and China would probably pose significant obstacles.

And our challenge right now is the Iranians continue on the path to acquiring nuclear weapons, and it's a great threat. It's not just a threat -- threat to the state of Israel. It's a threat to the stability of the entire Middle East.

If Iran acquires nuclear weapons, all the other countries will acquire them, too. The tensions will be ratcheted up.

What would you do if you were the Israelis and the president of a country says that they are -- they are determined to wipe you off the map, calls your country a stinking corpse?

Now, Sen. Obama without precondition wants to sit down and negotiate with them, without preconditions. That's what he stated, again, a matter of record.

I want to make sure that the Iranians are put enough -- that we put enough pressure on the Iranians by joining with our allies, imposing significant, tough sanctions to modify their behavior. And I think we can do that.

I think, joining with our allies and friends in a league of democracies, that we can effectively abridge their behavior, and hopefully they would abandon this quest that they are on for nuclear weapons.

But, at the end of the day, my friend, I have to tell you again, and you know what it's like to serve, and you know what it's like to sacrifice, but we can never allow a second Holocaust to take place.

BROKAW: Sen. Obama?

OBAMA: Well, Terry, first of all, we honor your service, and we're grateful for it.

We cannot allow Iran to get a nuclear weapon. It would be a game-changer in the region. Not only would it threaten Israel, our strongest ally in the region and one of our strongest allies in the world, but it would also create a possibility of nuclear weapons falling into the hands of terrorists.

And so it's unacceptable. And I will do everything that's required to prevent it.

And we will never take military options off the table. And it is important that we don't provide veto power to the United Nations or anyone else in acting in our interests.

It is important, though, for us to use all the tools at our disposal to prevent the scenario where we've got to make those kinds of choices.

And that's why I have consistently said that, if we can work more effectively with other countries diplomatically to tighten sanctions on Iran, if we can reduce our energy consumption through alternative energy, so that Iran has less money, if we can impose the kinds of sanctions that, say, for example, Iran right now imports gasoline, even though it's an oil-producer, because its oil infrastructure has broken down, if we can prevent them from importing the gasoline that they need and the refined petroleum products, that starts changing their cost-benefit analysis. That starts putting the squeeze on them.

Now, it is true, though, that I believe that we should have direct talks -- not just with our friends, but also with our enemies -- to deliver a tough, direct message to Iran that, if you don't change your behavior, then there will be dire consequences.

If you do change your behavior, then it is possible for you to re-join the community of nations.

Now, it may not work. But one of the things we've learned is, is that when we take that approach, whether it's in North Korea or in Iran, then we have a better chance at better outcomes.

When President Bush decided we're not going to talk to Iran, we're not going to talk to North Korea, you know what happened? Iran went from zero centrifuges to develop nuclear weapons to 4,000. North Korea quadrupled its nuclear capability.

We've got to try to have talks, understanding that we're not taking military options off the table.

BROKAW: All right, gentlemen, we've come to the last question.

And you'll both be interested to know this comes from the Internet and it's from a state that you're strongly contesting, both of you. It's from Peggy (ph) in Amherst, New Hampshire. And it has a certain Zen-like quality, I'll give you a fair warning.

She says, "What don't you know and how will you learn it?"

Sen. Obama, you get first crack at that.

OBAMA: My wife, Michelle, is there and she could give you a much longer list than I do. And most of the time, I learn it by asking her.

But, look, the nature of the challenges that we're going to face are immense and one of the things that we know about the presidency is that it's never the challenges that you expect. It's the challenges that you don't that end up consuming most of your time.

But here's what I do know. I know that I wouldn't be standing here if it weren't for the fact that this country gave me opportunity. I came from very modest means. I had a single mom and my grandparents raised me and it was because of the help of scholarships and my grandmother scrimping on things that she might have wanted to purchase and my mom, at one point, getting food stamps in order for us to put food on the table.

Despite all that, I was able to go to the best schools on earth and I was able to succeed in a way that I could not have succeeded anywhere else in this country.

The same is true for Michelle and I'm sure the same is true for a lot of you.

And the question in this election is: are we going to pass on that same American dream to the next generation? Over the last eight years, we've seen that dream diminish.

Wages and incomes have gone down. People have lost their health care or are going bankrupt because they get sick. We've got young people who have got the grades and the will and the drive to go to college, but they just don't have the money.

And we can't expect that if we do the same things that we've been doing over the last eight years, that somehow we are going to have a different outcome.

We need fundamental change. That's what's at stake in this election. That's the reason I decided to run for president, and I'm hopeful that all of you are prepared to continue this extraordinary journey that we call America.

But we're going to have to have the courage and the sacrifice, the nerve to move in a new direction.

Thank you.

BROKAW: Sen. McCain, you get the last word. Sen. Obama had the opening. You're last up.

MCCAIN: Well, thank you, Tom. And I think what I don't know is what all of us don't know, and that's what's going to happen both here at home and abroad.

The challenges that we face are unprecedented. Americans are hurting tonight in a way they have not in our generation.

There are challenges around the world that are new and different and there will be different -- we will be talking about countries sometime in the future that we hardly know where they are on the map, some Americans.

So what I don't know is what the unexpected will be. But I have spent my whole life serving this country. I grew up in a family where my father was gone most of the time because he was at sea and doing our country's business. My mother basically raised our family.

I know what it's like in dark times. I know what it's like to have to fight to keep one's hope going through difficult times. I know what it's like to rely on others for support and courage and love in tough times.

I know what it's like to have your comrades reach out to you and your neighbors and your fellow citizens and pick you up and put you back in the fight.

That's what America's all about. I believe in this country. I believe in its future. I believe in its greatness. It's been my great honor to serve it for many, many years.

And I'm asking the American people to give me another opportunity and I'll rest on my record, but I'll also tell you, when times are tough, we need a steady hand at the tiller and the great honor of my life was to always put my country first.

Thank you, Tom.

BROKAW: Thank you very much, Sen. McCain.

That concludes tonight's debate from here in Nashville. We want to thank our hosts here at Belmont University in Nashville and the Commission on Presidential Debates. And you're in my way of my script there, if you will move.

In addition to everything else, there is one more presidential debate on Wednesday, October 15, at Hofstra University in New York, moderated by my friend, Bob Schieffer of "CBS News."

Thank you, Sen. McCain. Thank you, Sen. Obama. Good night, everyone, from Nashville.