Eric Cantor Talks Competing Jobs Plans; Dianne Feinstein on Alleged Iranian Plot

The following is a rush transcript of the October 16, 2011, edition of "Fox News Sunday With Chris Wallace." This copy may not be in its final form and may be updated.

CHRIS WALLACE, HOST: I'm Chris Wallace.

There may be more job plans than actual jobs coming out of a divided Washington these days.

Can all sides agree on anything to help get America back to work? We'll ask a top Republican many Democrats blame for blocking their idea, House Majority Leadership Eric Cantor in a "Fox News Sunday" exclusive.

And Iran's alleged plot to kill a Saudi diplomat here in Washington -- how should the U.S. respond? Is military action likely?

We'll discuss what happens now with the chairman of the Senate Intelligence Committee, Dianne Feinstein.

Plus, 2012 politics. Herman Cain soars, Mitt Romney holds steady, Rick Perry stumbles. We'll ask our Sunday panel where we stand in the GOP presidential race.

And our power player of the week holds the keys to our national treasures.

All right now on "Fox News Sunday."

(MUSIC)

WALLACE: And hello again from Fox News in Washington.

With the economy stalled and Washington deadlocked, we begin today with whether our government will do anything to help get Americans back to work?

Joining us now, House Majority Leader Eric Cantor, who was one of the key figures pushing the Republican agenda.

And, Congressman Cantor, welcome back to "Fox News Sunday."

HOUSE MAJORITY LEADER ERIC CANTOR: Good to be here, Chris.

WALLACE: President Obama and the Democrats are portraying you these days as the face of Republican obstructionism repeatedly, calling you out by name.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I'd like Mr. Cantor to come down here to Dallas and explain what exactly in this jobs bill does he not believe in. What exactly -- what exactly is he opposed to.

(END VIDEO CLIP)

WALLACE: We'll get into the question of what you oppose in the Obama jobs bill and what you support in a moment.

But how do you -- speaking generally, how do you feel about being the new political villain according to the Democrats?

CANTOR: You know, I guess a lot of the folks on the other side of the aisle want to boil this down to personality. And it's really not about that, the differences that we have with this president are policy-based.

And we know in this town, Chris, there are a lot -- there's a lot of differences right now. And I think the people of this country want to see us trying to set aside those differences and actually come together on the things that we can agree on. We agree that the economy is woefully, woefully weak. We agree that there's too much income disparity in this country.

We believe that everyone ought to be lifted up and we ought to be working on the policies that help that happen, which is to focus on small businesses. And that's what we are trying to do going forward.

WALLACE: All right. Let's break this down and talk specifics. Let's look at the president's job's plan, which was blocked in the Senate this week. Here it is -- $245 billion in tax cuts in incentives, $140 billion in new spending on infrastructure and aid to states, $62 billion in aid to the unemployed.

Question: what's wrong with that plan?

CANTOR: Well, the plan in total was one that was met with a lot of resistance frankly on both sides of the aisle when the president unveiled it in September. And so, when the president spoke that night, I said, let's work together, stop the all-or-nothing approach. We're not going to be for tax increases on small businesses. He knows that. The Senate just killed the bill this week.

So, we said since the beginning when the president came to my district. I've said again and again, Mr. President, we want to work with you. We've got our plan here. This is a plan for America's job creators. We have sent -- we've got 12 bills sitting over on the Senate, that there are things that the president says he believes in -- let's work together, let's find some of the things in his plan that we agree with and let's go ahead and do that for the American people.

WALLACE: OK. We'll get to the Republican plan. And I agree, there is a plan and we'll get to that in the moment.

But you say that there are parts of the Obama plan that you can support. Like what?

CANTOR: Well, I mean, this week was indicated of how we can come together. We passed big three trade bills that are over five years in the making. We have a 3 percent withholding bill that we're going to bring up in another week to help small businesses in the way they conduct their businesses within the government.

We've also had bills coming forward the president says he supports that helps small businesses to access financing and capital so they can begin to grow and create jobs. The president talks a lot about the need for unemployment insurance reform. We've had that in our plan, Chris, since two years ago. When we were in the minority, then Leader Boehner and I went to the president. We presented him with the no cost jobs plan. We said we can do these things, let's work together, let's set aside this all-or-nothing approach that the president continues to go out across this country and campaigns about.

WALLACE: OK. Let's talk about the big parts of the Obama plan -- $100 billion in new spending on roads, bridges and schools. For or against it?

CANTOR: Well, we believe that there's a need for some infrastructure spending in this country, absolutely. But I think what you've got to look at is the president has gone across this country and found bridges and roads where he said, "See, this is why we need spending."

And I think what that does is remind people that the stimulus bill that he created and passed didn't address the problems. There's a reason -- because the process of approvals is so weighed down and bureaucratic red tape is so thick, you can't get the money to the jobs.

So, we said, let's reform the city. Let's go about redoing the permitting process so we can actually get those shovel-ready jobs that he speaks -- the money that they need. Absolutely.

WALLACE: So, if you could get the re-permitting, in effect, taking some of the red tape and cutting it, would you go for $100 billion in infrastructure and new spending?

CANTOR: Well, what we want to see is we want to see the states set sides done away with right now, when states have monies, they come from the federal programs. They are required to set aside 10 percent of those funds for projects that really are not priorities, bypassing others that are nice things. But, frankly, right now, the infrastructure of this country needs to be dealt with.

So, it's about reform, Chris. Yes, we are for infrastructure spending but it's about reforming the system so we're not throwing good money after bad and we can actually get the job done.

WALLACE: What about in the Obama plan, $35 billion for states so that they don't have to lay off teachers, police and firefighters?

CANTOR: Here we go again. I mean, this is the type of monies and these are the type of programs that the president advocated in the stimulus program. I think that the country understands Washington doesn't create jobs.

We believe in private enterprise. We believe the way you do -- the way you get the economy going again is a focus on the business of this country, every one of which started with the entrepreneur making a decision that they were going to invest their time and money to create jobs and to create an ongoing concern. We need that kind of activity. That's priority right now. We saw what happened with the stimulus money. Much of that went to the states. And you know what happened? It sustained some jobs for about a year and then the states were faced about with billions of dollars in debt once that year was over it.

WALLACE: You know, I get the sense and forgive me if I am wrong -- I don't want to put words in your mouth -- that you don't want to be portrayed as an obstructionist. Yes, we want to business -- but, basically, you oppose the Obama plan?

CANTOR: We oppose raising taxes on small businesses. We --

WALLACE: Well, he what do you mean -- the Senate plan, that would be for millionaires and billionaires. Now, I agree, some of them are small businesses. But, I mean, we are now talking not about $250,000, we're talking about people making over a million a year.

CANTOR: Let me tell you -- when I spoke to a small businesswoman in my hometown of Richmond, and she told me, you know, it's hard for me to conduct business right now. And she said, why are you talking about raising taxes in Washington? Because I want to be one of those successful businesspeople, she said. She said, but why is it that you want to go in and take away the kind of hope that I have to be successful?

And we know in this country right now that there is a complaint about folks at the top end of the income scale, if they make too much and too many, don't make enough. Well, we need to both go encourage those at the top of the income scale to actually put their money to work to create more jobs so that we can see a closing of the gap. You know, we are about income mobility and that's what we should be focused on to take care of the income disparity in this country.

WALLACE: OK. Let's talk -- I know you brought it here, the Republican plan. The president has repeatedly said Republicans don't have an economic plan. In fact, you've got it right there.

The House introduced a job's plan last May, let's break it down:

Review and rollback costly regulations.

Cut the top corporate and individual tax rate to 25 percent.

Cut trillions in spending.

Why is that a better way to create jobs?

CANTOR: Well, we have seen that the other way doesn't work. We've seen the stimulus bill that the president put forward in the beginning of his term I think certainly did not reach the promises that he made. There are too many people unemployed in this country.

We believe in private enterprise. We believe in small business. Our job creators' agenda is just that.

And so, we want the president to work with us. We want him to stop campaigning. Let's go find the things that are in common between this plan and his.

And, in fact, Chris, I think you'll see within the next month, we will take portions of this plan that match up with his, put them across the floor to help small businesses.

WALLACE: All right. But here's the issue -- the president points out that Moody's Analytics, one of the top economic consulting firms, scored his plan, figured at what impact it would have, and says it would add 1.9 million jobs next year and grow the economy by an addition 2 percent.

And he issued this challenge. Listen.

(BEGIN VIDEO CLIP)

OBAMA: Show us the Republican jobs plan that independent economist would indicate would actually put people back to work. I haven't yet seen it.

END

(END VIDEO CLIP)

WALLACE: Congressman Cantor, do you have an independent analysis that shows how this plan would grow the economy and add jobs?

CANTOR: First of all, I would say as to the Moody's economist that the president speaks to, they and their chief economist was the one that predicted that the stimulus program would keep unemployment from rising above 8 percent. So, I think we need to raise some questions about that assessment of his.

WALLACE: In fairness, he was an economic adviser to John McCain in 2008, Mark Zandi, and the fact there's a lot of the private economic firms that say whether it's 1 percent or 2 percent growth, a million jobs, 2 million jobs, that it would have some stimulative affect.

CANTOR: Let's look at this. There has --

WALLACE: Here's a question, do you have independent scoring of what your plan does?

CANTOR: We have -- we put forward a plan on the beginning of the year, our budget, OK, and we had independent Congressional Budget Office scoring which did several things. It talked about the fact that our plan actually dealt with the one crisis bringing down the debt and deficit over $6 trillion and it did talk about the ability for our plan to grow new jobs, yes. So, we've got that kind of analysis.

WALLACE: But you don't on this jobs plan?

CANTOR: Well, what this jobs plan is taking pieces of our overall vision for this country and saying, you know what? We've got to provide incentive for the private sector to grow.

You know, look at the facts, Chris. Since the president has taken office. There's been 1.6 million jobs lost in the private sector net. We've also seen the fact that 7.5 million foreclosures during this president's term.

Obviously, his economic plans are not working. That's why we are trying to say we've got to change directions here. We've got to focus on private enterprise and small business. We've got to get the entrepreneurs back in the game. And that's our plan does.

WALLACE: But let me point out what Mark Zandi and you've raised legitimate questions about him because, you know, like most economists, he's not always right. He's the chief economist at Moody's Analytics. Here's what he says about your proposals. "Generally good longer-term economy policy, but they won't mean much for the economy and job market in the next year.

(END VIDEO CLIP)

CANTOR: There is a lot of dispute about Mark Zandi and his predictions because of the results of the stimulus plan that he lauded. I mean, we know --

WALLACE: But the agreement is simply that if you don't have a lot of immediate spending -- and look, I agree, you know, it didn't work well in stimulus one. But the argument is if you don't have some spending and some immediate tax relief, that you're not going to stimulate jobs in the short term, that the kind of cutting back regulations, lowering taxes is really good long term economics, but not give a short term boost to the economy.

CANTOR: We believe, Chris, the best way is to provide incentives for investment to create jobs. We are for tax relief for small business. We believe and agree with the president that business expansion is something that what we can provide entrepreneurs right now and you'll see us bring a bill forward. Hopefully, the president will agree to work with us. I think, finally now, he is talking about actually joining us in these incremental approaches rather than his all or nothing plan that has died in the Senate now.

WALLACE: OK, I got two minutes and I got two questions I want to ask you. Congress's so-called supercommittee now has just a little over a month -- November 23rd is the deadline for it to come up with $1.2 trillion in deficit reduction.

Do you think they're going to be able to work out a deal and avoid these automatic triggers which would include $600 billion in more Pentagon cuts?

CANTOR: Yes, I think the joint selection committee will be successful in reaching the goal of getting at least $1.2 trillion in cuts. And, in fact, Chris, I served on the Biden discussions. And to the vice-president's credit, it was that committee that actually produced the blueprint that I think can form the basis of the getting to the $1.2 trillion.

WALLACE: So, you are confident the supercommittee will make a deal.

CANTOR: I am. I think folks in this town on both sides of the aisle know that we can't fail. There has to be success and an outcome here.

WALLACE: Finally, I want to take you back to your remarks a week ago about "Occupy Wall Street." Here they are.

(BEGIN VIDEO CLIP)

CANTOR: I for one increasingly concerned about the growing mobs occupying Wall Street and other cities across the country.

(END VIDEO CLIP)

WALLACE: Congressman, do you stand by that comment on the mobs? And what do you think about the effort by the Obama White House and the Democrats to try to harness the energy, the movement here as part of their reelection effort?

CANTOR: Chris, I think more important than my use of the word is the fact that there is a growing frustration out there across this country and it's warranted. People -- too many people are out of work. But where I'm most concerned is we have elected leaders in this town who, frankly, are joining in the effort to blame others rather than focus on the policies that have brought about the current situation.

I mean, when you hear of the Democrat elected leaders joining in, blaming parts of our economy and society versus, let's take some of the credit or blame here in Washington. I mean, these are policies that they put into place and there's a lot that can be done here in this town to turn the economy around, and promote against income mobility and not go in and excoriate some who have been successful. We want success for everybody.

WALLACE: Congressman Cantor, thank you. Thank you for coming in today and it's always a pleasure to talk with you, sir.

CANTOR: Chris, thanks.

WALLACE: Up next, Iran's alleged plot to murder a diplomat in Washington. We'll talk with Dianne Feinstein, chairman of the Senate Intelligence Committee, when we come right back.

(COMMERCIAL BREAK)

WALLACE: It was stunning news this week. Elements of the Iranian government plan to assassinate the Saudi ambassador here in Washington.

Joining us now to discuss the alleged plot and how the U.S. should respond is chairman of the Senate Intelligence Committee, Dianne Feinstein.

And, Senator, welcome back to "Fox News Sunday."

SEN. DIANNE FEINSTEIN, D-CALIF.: Thank you. Thank you, Chris.

WALLACE: You were just saying, as we just before we went on the air, people still don't believe this. Persuade them that this was real and answer two questions from me. How high up in the Iranian government did this go? And what does it tell you about what's going on in Tehran right now?

FEINSTEIN: Well, I was first briefed in the beginning of September. It sounded doubtful because of the cast of characters and because of the fact that the operative entity was the Quds force, department 400, part of the Iranian revolutionary guard, the elite unit that really is sent out by Iran into various areas, that finances terrorism, et cetera. And I didn't believe it either.

But as it turned out, it's very real. And what it represented was a rather unique effort between our Drug Enforcement Administration, FBI, CIA, a kind of coming together of agencies to collect intelligence, both human and signals intelligence.

WALLACE: What do you think is the single most compelling piece of evidence that this is real?

FEINSTEIN: I think it's finished. The case is dead bang, I think. I think some of the signals intelligence candidly is the most compelling.

FEINSTEIN: And, secondly, Arbabsiar himself --

WALLACE: This is the Iranian used car salesman.

FEINSTEIN: That's right. In answers to his questions essentially fessed up, essentially admitted it was real and money was transferred. So, it's real all right.

WALLACE: And how high up in the government does it go? And what does it tell you about what is going on in the government?

FEINSTEIN: The four Quds force officials sanctioned by the Treasury Department include Qassem Soleimani, who was head of the Quds force. He is known as a very careful manager. He is reported to be very close to the supreme leader. There's no evidence that it reached the supreme leader. There are certainly is evidence that --

WALLACE: Which is to say the supreme leader is Ayatollah Khamenei.

FEINSTEIN: -- Soleimani knew and the head knew.

Now this is an unusual thing. Iran reaches out around Iran, but to cross to the other side of the world and try and attack in this country is an escalation, and that's what concerns us and I think that's what concerns the Saudis as well.

WALLACE: You say an escalation. You also say we should be on alert for other plots in other countries? What do you know about that?

FEINSTEIN: Well, there's no question that the Quds force has been responsible for other operations going back to 1993 in Buenos Aires, with the Argentinean-Israeli mutual association and that bomb. And four days ago in Iraq, they carried out an operation or financed an operation against our people in Iraq.

WALLACE: So, but do you think there are other ongoing plots in other countries?

FEINSTEIN: What I said was I think there well could be. I don't think this is just an isolated thing that suddenly came up when they have never done these kinds of things before. They have done these kinds of things before and this is certainly a continuum, but an extension and an escalation.

WALLACE: So far, all President Obama is talking about is tougher sanctions. And we went back and looked at the history of that. Put it up.

Since 1979, the U.S. has issued 19 executive orders and passed seven laws sanctioning Iran. Since 2006, the U.N. has passed five sets of sanctions. Meanwhile, despite all of that, Iran continues to pursue a nuclear program. It continues to be, as we see here, a state sponsor of terrorism.

Do you believe that sanctions can work to change Iran's behavior?

FEINSTEIN: I don't think the sanctions have been as complete as they must -- as they should be. I wished they had sanctioned the central bank of Iran and that would affect oil and maybe that's why they didn't do it. But that makes a big difference.

WALLACE: Is that what you would like to see now?

FEINSTEIN: Yes.

WALLACE: And the argument is, well, we could sanction the bank -- and the key there is obviously not we don't do business with the central bank. But that would mean we would black list any foreign country or company that does with the central bank.

FEINSTEIN: Correct.

WALLACE: Can that work without China and Russia being on board?

FEINSTEIN: Well, that's another subject and this is why the State Department sent out teams to share evidence, to share intelligence to the extent they could with all our allies and in particular with the Security Council of the United Nations. We actually were briefed by one of the men that participated in that Security Council briefing.

There should be no doubt and the evidence is very strong, the FBI believes that the case is both strong and good and will result in a conviction.

WALLACE: But you would support sanctioning, blacklisting Iran's central bank and any company around the world that does business with them too?

FEINSTEIN: Absolutely, and for other reasons, too. I mean, this is just one part.

Iran is escalating I believe its nuclear development. Iran is increasingly hostile. They have not ceased supporting Hezbollah or Hamas or participating in the -- well, bringing of missiles and rockets into Lebanon through Damascus. It's a very dangerous situation.

And my hope is that there can be some kind of discussion that can be convincing for the Iranians to change course. Absent that at one time or another, if you project out a number of years, we are on a collision course. If we want to avoid it, we have to take action to avoid it.

WALLACE: Well, I want to -- I want to talk to you about that. Retired General Jack Keane, he is one of the architects of our counterinsurgency strategy in Iraq and Afghanistan, said the U.S. should take military action. Here he is.

(BEGIN VIDEO CLIP)

GEN. JACK KEANE, FOUR STAR GENERAL (RET.): I would start retiring the Quds force who has been using these proxies to conduct actions against us. I would conduct covert actions against them and espionage. That means kill them and take their bases away from them.

(END VIDEO CLIP)

WALLACE: Why not go after the Quds force?

FEINSTEIN: Well, that's perhaps more difficult than it's said to be. I think this is a large operation. It's in the thousands. It's an elite branch -- how you go after them and how do you do it? I never have seen a plan to do it.

It probably would escalate into a war, and the question is: do we want to go to war with Iran at this time? My judgment is no. We have our hands full with Iraq, with Afghanistan, with the deteriorating relationship with Pakistan.

I mean, I think this is not -- our country should not be looking to go to war. I think we should be looking to stop bad behavior, short of war.

WALLACE: I've got a couple of minutes left. I want to ask you about two other hot spots.

Friday afternoon, President Obama announced he's sending 100 U.S. Special Forces as trainers, as advisers into Central Africa to act, as I say, as trainers against the Lord's Resistance Army, several hundred brutal guerrillas there who have created tremendous damage over the last couple of decades.

Do you support -- you say we got our hands full -- do you support deploying more U.S. troops into another foreign conflict?

FEINSTEIN: Well, let me, first of all, say what it is. We passed a resolution during the Bush administration that urged that we respond to this brutality. And President Bush authorized advisers to go over. They were unarmed.

The difference here is that these are still advisers, the 100, but they are armed and they are cleared to act in self defense.

Now, what is the Lord's Resistance Army? It is a brutal militia. And it's in Uganda. It's in the Central African Republic. It's in the Congo. And it moves through and it rapes and it pillages. And it cuts people apart.

WALLACE: We are running out of time. Why send troops there but we won't send troops to try to end this slaughter in Syria?

FEINSTEIN: Well, that's a good question. But I think this is -- I think they're two entirely different set of circumstances. One is a reaction. It's part of the Arab spring. The other has been an ongoing move to essentially annihilate people, essentially really kill large numbers of people.

And I think this is a small group, it's 100 people. They give military advice to the regional army that's in the area. We'll see what happens.

WALLACE: Finally, the Obama administration is now scaling back its plans for how many troops we're going to keep in Iraq at the end of 2011. Fewer than 1,000, perhaps a few hundred because we can't work out a deal with the Iraqi government. Your reaction?

FEINSTEIN: Well, that's right. The Status of Forces Agreement expires at the end of this year. We need to have a new Status of Forces Agreement, or we are there essentially against the will of the government. And I think we will not continue against the will of a government.

WALLACE: But are you troubled about the idea we would be all out of Iraq?

FEINSTEIN: Yes, I'm troubled because of -- you know, I look at Korea, the length of time that it took to provide stability there or Japan, the length of time it took to provide stability there.

And I think people are so anxious for our men and women to come home and I understand that. It is also important that the job is completed in a way that provides the greatest chances for stability for the country -- I think that is a key goal for Afghanistan as well as Iraq. So, I am hopeful they will be able to quickly negotiate a Status of Forces Agreement. Absent of that, yes, we'll have to bring our people home.

WALLACE: Senator Feinstein, we're going to have to leave it there. Thank you so much for talking to us today. And we'll stay on top of all these stories.

FEINSTEIN: Thank you, Chris. And happy birthday.

WALLACE: Well, thank you for that.

FEINSTEIN: You're welcome.

WALLACE: Although, I got to say, at my age, it's not a cause for celebration.

FEINSTEIN: Yes, I understand.

WALLACE: Coming up, our Sunday panel on the Republican presidential race. Who is up, who is down, and who is just hanging in there.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIPS)

GOV. RICK PERRY (R-TX), PRESIDENTIAL CANDIDATE: I have been ahead and I've been behind, and now is not the time to be worrying about your position in the polls.

HERMAN CAIN (R), PRESIDENTIAL CANDIDATE: Let me tell you something else before I go through that about being in the top tier of the candidates. Can you all see that big bull's eye on my back?

(END VIDEO CLIPS)

WALLACE: Former front-runner Rick Perry and current front-runner Herman Cain both trying to make sense of the fast-changing Republican race for president.

Time now for our Sunday group -- Bill Kristol of The Weekly Standard; Liz Marlantes of The Christian Science Monitor; former State Department official Liz Cheney; and Jeff Zeleny, national political correspondent of The New York Times.

All right. Let's start with Herman Cain, who has soared to the top of the polls, and whether you like it or not, his 999 tax reform plan is getting all of the buzz, all of the attention.

But, Jeff, as the one who goes out there the most of all of us and actually goes into these, how real is his campaign? What kind of an organization has he got in the early states? How much time is he spending there?

JEFF ZELENY, NATIONAL POLITICAL CORRESPONDENT, THE NEW YORK TIMES: Well, he doesn't have much of an organization. I think Herman Cain is as surprised by this boomlet as anyone. But I do spend a lot of time out in Iowa and New Hampshire, and we don't find Herman Cain there at all.

He has not been in Iowa since August 13th, the day of the straw poll. He's not in South Carolina, he's not in New Hampshire. He's basically in Tennessee. He was in Houston giving a speech. He's on a book tour.

But now his campaign is sort of reassessing things. He's hiring new people. They are trying to do what they can to take advantage of this moment. But he's very popular.

I mean, throughout all of these debates, I think he has presented himself as he has a commonsense approach, he's likeable. So, I think some people are advising him to come to Iowa, come to New Hampshire right now, and it's possible to actually make something out of this.

But for now, we'll see how he adapts to that. But he is, at this point, not a serious candidate in the sense of being organized in places to actually win the Iowa Caucus.

WALLACE: Which raises the question, Bill, is there a different model this year? I mean, could it be that -- I mean, Cain has surprised all of us with his popularity and his ability to make an impact with the Republican voters. Is it possible you can do it with debates and national TV appearances and social media and you don't have to spend a lot of time in these states?

BILL KRISTOL, THE WEEKLY STANDARD: Well, up until now, you can have done it, and he has done it. It's been a nationalized campaign.

The debates have driven the campaign. They are nationally televised. And look, if you're on Fox News or other networks, even, to a lesser degree, more people in Iowa see you when you do a hit on Fox News than when you show up in a living room in Iowa. That's just a fact if you do the math and divide the national audience --

(CROSSTALK)

WALLACE: But what about the argument --

KRISTOL: Now, at the end of the day, you do have to show up. People want to see you.

WALLACE: I was going to say, the care and tending of these --

KRISTOL: Well, and he's going to do that. He's speaking next Saturday night at a big conservative dinner in Iowa. He rescheduled -- he changed his schedule to do that. Now, whether he can put it all together this fast -- it's just a couple of months to the caucuses -- is a question. But, you know, he's been pretty shrewd so far.

WALLACE: Liz Marlantes, let's turn to Governor Rick Perry, who, as we have noted, has dropped like a stone in the polls from the 30s, down into the teens. He announced a big plan on Friday to boost domestic energy, and he said that would create over a million jobs.

Can he come back?

LIZ MARLANTES, CHRISTIAN SCIENCE MONITOR: Sure. I think Perry can come back. And I think -- I wouldn't count him out entirely.

I did feel like the energy plan -- he's been just consistently sort of tone deaf recently. And there was something about putting forward an energy plan rather than a broader jobs plan that struck me as, he's just been a little too much governor of Texas, and he's gotten that criticism repeatedly, that he doesn't seem to be speaking to a national audience in the way that other candidates have been.

And even the energy plan, you know, right away other candidates were criticizing him for essentially ripping off their plans. Gingrich and Bachmann came out right away. So, I have been kind of surprised that Perry hasn't done more. And in a way, it always strikes me as a staffing mistake. I was surprised in the last debate that he didn't come forward with some concrete economic proposals --

(CROSSTALK)

WALLACE: I was going to say, this was a debate about --

MARLANTES: About the economy.

WALLACE: -- purely about economics, and he's sitting there saying, well, I'm not going to give it to you.

MARLANTES: Exactly. And, you know, nobody is expecting verbal dexterity from him at this point. I think going into the next debate, he's going to have lower expectations than almost anybody.

But at the very least, as a matter of preparation, he could have come in with some concrete ideas, and I think that would have really helped. And it's surprising to me that he hasn't come up with something broader and more specific.

WALLACE: Liz Cheney, let's talk about former governor Mitt Romney. He had another strong debate performance this week.

Chris Christie, the governor of New Jersey, endorsed him. It seems with Christie not getting in the race and Perry fading, that -- at least temporarily -- that much of the Republican establishment has decided to back him, Romney. But you continue to see this disconnect where all the insiders say, well, he's going to be the inevitable nominee, and in the polls he can't get above 25, 30 percent.

I mean, how does he connect with the voters and persuade them, you can trust me and I'll be a good representative of this party as the nominee?

LIZ CHENEY, FMR. STATE DEPT. OFFICIAL: Well, I think the polls themselves at this point don't really mean that much, frankly. I think that Governor Romney has been very impressive in the debates. I don't think that you can say any one of our candidates, frankly, at this point has managed to consolidate support across the board.

I think that one of the things that's fascinating is how important the debates have been. They've been very important in terms of Governor Romney's ability to lay out his plans. They've also been important because they've given a platform for people like Cain, like Gingrich, like Sanatorium.

We've got a number of folks on our side, I think, who have benefited from them. I also think what's been important this time, and what you see in the rise of somebody like Cain, is ideas, and the fact that the voters are really hungry.

They are hungry for bold change. And when Herman Cain has got his 999 plan, surely people are going to shoot at it, surely people are going to say, well, it's got flaws. It may well have many flaws, but I think it's a very interesting plan. And I think it shows the appetite out there for somebody who is not Obama, for somebody who is actually going to help to support the private sector, and who, in fact, is willing to propose radical change.

WALLACE: I want to get into one last thing in this segment, and that is the third quarter fund-raising numbers are out, and they are very interesting. Let's put them up on the screen.

As you can see, Perry and Romney lead the field by a wide margin. That first number is what they received in the first quarter. The second -- can we go back, or is that going to create some huge problem?

There you go. Wow, we were able to do it.

The first number in White is how much they received. The other is how much cash they have on hand as of the end of the month. And as you can see, Romney and Perry, in the teens, in the millions. A big drop-off.

And now let's go to those last three. Huntsman, Gingrich and Santorum running on fumes. Even more so, Huntsman and Gingrich campaigns actually in debt. That overstates how much money they have.

What do you read from those third quarter numbers, Jeff? And could some of these candidates drop out before Iowa and New Hampshire?

ZELENY: I think it's possible, but, I mean, I think most important to take away from the numbers is Rick Perry is in this race to stay. He's a very serious candidate.

So, for all of our discussions here about, he didn't do well in the debates, he's going to have money to prosecute the argument in television ads and other places. He is popular on the stump, people want to like him. So his number, his $15 million cash on hand, is a very important number, and that's one thing that scares the Romney campaign.

WALLACE: You were saying earlier that you feel, because the debates have really been the campaign, that with the last debate for a while this coming Tuesday, we're entering a new phase.

ZELENY: We are entering a new phase. I think we're going to see voters out there.

They've spent a couple months sort of absorbing all these things. It's absurd to think that Rick Perry is still not in this race. People want to like him, and I think the next couple months, through October and in November, we'll see a different Rick Perry.

WALLACE: With fewer debates, more campaign advertisements, more campaign appearances, where you can control your own messaging.

ZELENY: Exactly.

WALLACE: OK.

We have to take a break here. But up next, jobs, the supercommittee, and the first crack in Obamacare. We'll tackle it all when we come right back.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIPS)

OBAMA: I'm urging members of Congress to vote on putting hundreds of thousands of teachers back in the classroom, cops back on the streets, and firefighters back on the job. And if they vote no on that, they will have to tell you why.

HOUSE MAJORITY WHIP KEVIN MCCARTHY, R-CALIF.: The president needs to come off the campaign trail and get to work.

(END VIDEO CLIPS)

WALLACE: President Obama and House Republican Whip Kevin McCarthy on the policy and politics of jump-starting the economy.

And we're back now with the panel.

So, as we talked about with Eric Cantor, the Obama jobs plan as a whole was blocked in the Senate this week, and the idea of Democrats now is to break it up into smaller pieces and introduce them. You heard this one about aid to the states to keep first responders and teachers on the payroll and let Republicans block them and make an issue of it.

It obviously, Bill, isn't going to get anybody back to work, any actual people to get new jobs. But is it smart politics for the Democrats?

KRISTOL: Yes, most of my conservative friends think Obama is flailing, and it's ridiculous, what he's trying to do. I think from his point of view, it's not foolish, actually.

There's very little he can do, he must think, to get the economy going now. He's foolishly bought into the policies that have gotten us into the mess we're in. And unless he's going to fire Ben Bernanke tomorrow and fix the ridiculous Fed policy, et cetera, he's stuck with these policies. So why not try to blame House Republicans?

And there's some polling data that suggests that it's working mildly. At the end of the day, luckily, for Republicans, House Republicans won't be on the ballot. There will be a president nominee who will not be a member of Congress, most likely, right? Romney, Cain, Gingrich, Santorum, they are not in Congress now.

So it's going to be a little hard, I think, for Obama to win election running against the Republican Congress. But given his alternatives, I don't think it's entirely foolish to attack them. And I do think it's important that the Republican nominees broaden the economic debate and make it a debate about the overall measure (ph) of the economy and about Obamacare, for example, then the very narrow debate on particularly who is cutting a little bit more here, or who is voting for this jobs program there.

WALLACE: Liz Marlantes, what's your sense? Does a significant -- I'm not talking about individual little pieces, but a significant jobs plan get passed by Congress this year either through normal channels or through as part of the super committee's work?

MARLANTES: I don't think so. I mean, it certainly doesn't look very good.

Even watching your interview with Cantor this morning, who -- they always now want to express their bipartisan willingness to come together. But then, you know, he wasn't in favor of any of the specific provisions in Obama's jobs bill that Obama had specifically put in there to appeal to Republicans. He didn't actually really offer support for any of them this morning.

And the fundamental problem for Republicans, of course, it's not that they necessarily disagree with some of those provisions like extending the payroll tax cut, but it's how you pay for it. And time and time again, the problem that comes up in Congress is Republicans do not want to raise taxes under any circumstances, and Democrats are saying they want to pay for these things by raising taxes. I think the millionaire's surtax that the Senate Democrats inserted which wasn't part of Obama's original plan is also very good politics, because the Republicans really don't have an answer for that.

WALLACE: Liz, let's talk about the super committee, which, as I was pointing out with Eric Cantor, I mean, the clock is ticking. It started in August. Now we're in mid-October .

They have got a month, November 23rd, to come up with a deal, $1.2 trillion in deficit reduction, whether it's spending cuts, tax increases, whatever, or you end up with this automatic triggers which everybody says are just horrific, $600 billion more in cuts to the Pentagon. Leon Panetta says that would be a threat to national security.

Do they make a deal, or do we end up with the triggers?

CHENEY: I think the odds are that we'll have a deal. I think one of the places where you've got bipartisan support -- bipartisan agreement -- for example, is that the triggered cuts in the defense budget would just be devastating. Leon Panetta said it would be the equivalent of shooting ourselves in the head. So I think we'll get an agreement on spending.

You know, I think that the Republicans have actually put forward a response on this issue of the millionaire's tax, which is the notion that you've got the vast majority of small businesses in this country pay taxes as individuals at those highest tax rates, and those are the job creators. So I think, you know, we've got the super committee that will get something done, will avoid triggers, but it will only be part of what has to happen here.

The rest of it has got to be a set of policies put in place by a new president that understands that you've got to get the private sector going again. And I think in terms of President Obama, what he's doing politically he may think makes sense. I think it's actually scarier than that though. I think he really believes it.

I think that he's now put forward so many policies that aren't working economically and that are not working for him politically, that you've got to at some point say it must be ideology. It must be that he really believes in redistribution of the wealth. He really believes in increasing capital gains tax, even if it means lower revenues to the treasury. I mean, I think it's something new than we've seen from a president in a long time, and I think its' very concerning.

WALLACE: Jeff, let me get to one other interesting development this week.

Obamacare, late Friday, the Obama administration announced that it is abandoning scrapping CLASS, which a lot of people may not know. They may think it means cutting class, but CLASS, which was going to be a program to offer long-term insurance -- to offer insurance for long-term care, because they say the numbers just don't add up, it's unworkable financially.

How significant is that?

ZELENY: You know, I think it's symbolically significant because it's one more piece of the health care plan that will not be there. I'm not sure.

But this was an idea that was supported by Senator Kennedy. So, I think if he was still alive, there probably would have been a way to keep this in, and of course everything would have changed.

But I think that, over all, it's not affecting the broader national health care plan, but symbolically, I think it's probably more important, because it's just one more piece of hard evidence that this perhaps was not such a good idea overall. But it leaves most of the law in place, obviously.

WALLACE: Here's the one aspect of it which I think is interesting, Bill.

CLASS was supposed to cut the deficit by $86 billion over the next 10 years. And talk about a bookkeeping trick, the way they did it was that the premiums were going to start, and for five years, you would have to pay into the program, but no benefits came out. So, obviously, all of the money is coming in and none is going out.

If you take that away, the $86 billion, that was most of the deficit reduction all of Obamacare was going to provide over the next 10 years. So, if that's gone, you almost have no deficit reduction. KRISTOL: Well, and a lot of the rest of the deficit reduction is smoke and mirrors, I believe, and I think it's pretty easy to show.

No, I think the Republicans now need to say this is just the tip of the iceberg, we need to repeal Obamacare. They need to get back to stressing the importance of appealing Obamacare. It's the one thing President Obama can't pivot on.

He can blame the Republican House for not creating jobs, he can blame other people for other things. He and his party passed Obamacare, the public doesn't like it. And Republicans are going to run on repealing it, but they need to really highlight how damaging Obamacare is both to our health care system, and to the federal budget and to the economy.

It's one thing -- as I say, President Obama, it's his greatest achievement, but he's stuck with it.

WALLACE: And what about Romney? If Romney is the nominee --

KRISTOL: He more than others needs to do this. If he wants --

(CROSSTALK)

WALLACE: Not only that he says it, but how persuasive is it?

KRISTOL: It's fine. It's fine. Whatever he did six years ago as governor of Massachusetts, I wish personally he would defend it a little less forcibly. But whatever he did, if Republican voters and Independent voters think, as president of the United States on day one or day two, Mitt Romney will repeal Obamacare, I think an awful lot of conservatives and an awful lot of Independents who don't like Obamacare will be much more comfortable with Romney.

I think the way to take care of his health care problems, to be more aggressive on Obamacare and more aggressive on Medicare reform.

WALLACE: All right.

We're going to have to leave it there. Thank you, panel. See you all next week.

Don't forget to check out "Panel Plus," where our group picks right up with discussion on our Web site, FoxNewsSunday.com. We'll post the video before noon Eastern Time.

(COMMERCIAL BREAK)

WALLACE: From the Hope Diamond, to Dorothy's ruby red slippers, you can see some wonderful things here in Washington. And the man with the key to the collection is our "Power Player of the Week."

(BEGIN VIDEOTAPE)

WAYNE CLOUGH, SECRETARY, SMITHSONIAN INSTITUTION: What are we here for? We are here to discover knowledge. We are here to share that knowledge with the world.

WALLACE (voice-over): If Wayne Clough's goal sounds big, so is his job. He is the secretary of the Smithsonian, the biggest complex of museums, libraries and research centers in the world. He's in charge of 137 million objects ranging from treasures of American history to the animals in the National Zoo.

(on camera): The Smithsonian is popularly known as "The Nation's Attic."

CLOUGH: Yes.

WALLACE: I understand you hate that expression.

CLOUGH: No, I don't hate it. It's an adorable expression. But at the same time, the Smithsonian is far more than an attic. It is a place where things are really happening.

WALLACE (voice-over): Call it Smithsonian 2.0, because Clough is putting new focus on its role as a research center.

CLOUGH: We run satellites for NASA that look into outer space and discover, for example, new planets. And we want people to be aware of the kind of things that we do that we think are so relevant to the American people and the world.

WALLACE: He's also making the institution more accessible to people who can't get to Washington. Six-and-a-half million objects have been digitized.

CLOUGH: We'd like to go to 100 million, yes. Somewhere in that range.

WALLACE: Clough took over in 2008 after his predecessor was ousted for extravagant personal spending and poor management.

(on camera): When you came in, did you feel like you had to clean things up?

CLOUGH: Yes, I did. A lot of the people working here at the Smithsonian were demoralized, because they didn't have anything to do with (INAUDIBLE), but they felt that they reflected badly on them, and on the institution.

WALLACE (voice-over): The Smithsonian gets 65 percent of its budget from the federal government, $855 million this year. Clough has to convince Congress in this time of tight budgets not to cut funding.

CLOUGH: I tell people we are open every day of the year but one. And 30 million visits are made to the Smithsonian. We don't charge admission. There's nothing like it in the world. And people appreciate that.

WALLACE: During 14 years as president of Georgia Tech, Clough was known as a master fund-raiser. He's raised $450 million so far with pitches like this --

CLOUGH: If you like animals, I've got a product for you. Right? If you like art, I've got a product for you.

We have one of the world's largest collections of insects.

WALLACE: It always comes back to the collection. In his conference room, Clough showed us the cap Charles Lindbergh wore to cross the Atlantic, next to the watch Neil Armstrong war to the moon. And there was Abraham Lincoln's hand ball.

Clough seems thrilled by all of it, just as this seismic engineer was thrilled when D.C. was hit recently by an earthquake. No ducking under a table for him.

CLOUGH: I simply sat in my chair, because you ride seismic waves. And as you ride the wave, you can tell an awful lot about the earthquake.

WALLACE: The nation's treasures seems to be in good hands.

CLOUGH: The satisfaction for me is simply walking out and going through these museums and watching these young children go through, and listening to those voices and watching them enjoy what they are doing and learning just as I would have learned and enjoyed it as a child.

(END VIDEOTAPE)

WALLACE: Wayne Clough hope to raise $1 billion from private sources to make this repository of America's past a vibrant part of the nation's future.

And that's it for today. Have a great week, and we'll see you next "Fox News Sunday."

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