Rick Santorum secures conservative Christian endorsement; debate over Mitt Romney's business record

Written by Chris Wallace / Published January 15, 2012 / Fox News Sunday

Special Guests: Rick Santorum, Rick Tyler, Chris Chocola

The following is a rush transcript of the January 15, 2012 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.

Conservative Christian leaderships endorse Rick Santorum as they try to unite social conservatives behind one man.

Can anyone stop Mitt Romney? We'll talk to a candidate who tied for first in Iowa but lost steam in New Hampshire. Rick Santorum and his strategy for a come back as we continue our 2012 one-on-one series of interviews.

Then, some of Romney's rifles slam his business as vulture capitalism. We'll have a debate over private equity between Chris Chocola, head of the Club for Growth, and Rick Tyler, part of the pro- Gingrich super PAC behind the ads.

Also, will a controversial video derail U.S. peace talks with the Taliban? And who is behind the covert operation in Iran who killed a nuclear scientist? We'll ask our Sunday panel how both incidents will affect U.S. foreign policy.

And from the first in the nation primary to the no holds barred fight in South Carolina, we go on the trail.

All right now on "Fox News Sunday."

And hello again from Fox News in Washington. Well, there has been a big development in the Republican race for president. For months now, social conservatives have split their votes among the several candidates, leaving a clear path for Mitt Romney to be the front runner. But in a summit of Christian leaders in Texas yesterday, a super majority voted to back Rick Santorum. This just six days before voters in South Carolina go to the polls.

Joining us now from Myrtle Beach is the former senator from Pennsylvania.

And welcome back to "Fox News Sunday."

RICK SANTORUM (R), PRESIDENTIAL CANDIDATE: Thank you very much, Chris. Good to be with you.

WALLACE: Senator, how big of a deal is this? And especially, what's the practical effect on your campaign with just, as we say, six days before the primary?

SANTORUM: Well, it's a great -- it's a very big deal. The bottom line is that you have folks there representing a lot of different camps. A lot of people who came there to win the day for the candidate, and it was a very divided group at the beginning.

But as they work through it, they came to a consensus, an overwhelming consensus, like 75 percent of the people there decided to support me. And I think they did so because they know that I'm the consistent conservative. I'm someone who's willing to stand up for all of the issues, not just the moral and cultural issues, but economic issue and the moral crisis of this debt and this explosion of government and willing to stand up against radical jihadism and the things that are important to conservatives across in this country and they saw me as the one best chance of winning.

I beat Gingrich and Perry in Iowa. I beat them again in New Hampshire, and we're doing well here.

So, we feel very, very good that with their support, we're going to get a network of grassroots leaders here, lining up behind us and giving us that surge that we need coming down to this last week.

WALLACE: Have they made any promises, the ones who endorsed you, of giving you money, of going out publicly in supporting you?

SANTORUM: I haven't really talked to any of them. I talked to one person, to be honest with you, since that meeting. And what I was told that individual members are going to go out and do things with, you know, either endorsements or contacting people here in the state and across the states to support us and to help our cause. And we certainly accept all endorsements and help and money and grassroots activity -- anything they're willing to do to help, we'll be happy to take it.

WALLACE: But the fact is, the practical fact is, you have been splitting the vote of social conservatives with Gingrich and with Perry, should they drop out of the race so that the votes of those social conservatives can be united in supporting a candidate who supports their views?

SANTORUM: I'm not going to tell anybody to get in or out of the race. I think that's their decision to make. We're going to run the race as hard as we can and South Carolina is going to have big impact on this race, but it's not going to be the final issue. There are a lot of the races and a lot of states to come. We need to get this eventually down to a conservative alternative to Mitt Romney. And those -- when we finally get matched up, and we believe it will be us. When we get matched up, if you look at the polls done in other states down the road, we match up very well and ahead of Governor Romney almost every one of those state polls.

So, feel like once this field narrows, when we get it down to a two-person race, we have an excellent opportunity to win this race.

WALLACE: But, and I take your point you're not asking them to drop out. As long as they stay in the race, however, Perry and Gingrich, doesn't it have the practical effect of helping Romney and doesn't it diminish the effectiveness of social conservatives in trying to help pick the nominee?

SANTORUM: Well, I don't think it's just social conservatives. It's all conservatives. I think a lot of conservatives have concern about Governor Romney's record on the economy and Romneycare as a real scarlet letter here that we can't have a nominee that takes away the most important issue of this election which is an explosion of federal government and robbing the people's freedom on the federal level with Obamacare and Romneycare, which was the predecessor to Obamacare, just disqualifies him and his ability to go out and aggressively go after this top down approach to health care.

So, this is not just social conservatives. I'm hearing from conservatives across the board, economic, foreign policy. They're looking for someone with a strong consistent track record. And I'm hopeful -- again, you know, will it help? Yes. It would be helpful if everybody drop out and I would win. But, you know, the idea is, we're going to go through this process, people have the right to go out and make the case to the voters and then we'll see what happens.

WALLACE: Given that Newt Gingrich is beating you right now in the polls in South Carolina, why should his supporters back you? Why are you a truer conservative than Newt Gingrich?

SANTORUM: Well, I'll just look the -- at our leadership. When I was in the Republican leadership in United States, conservative organizations from national security to economic to social conservatives came to me to make sure that the conservative agenda was pushed in our leadership and made sure that those voters came to the floor of the United States Senate whether it was the NRA or the National Restaurant Association, or the National Rifle Association, those folks came and they understood we were the conservative voice of the leadership. We were the ones who were out there taking it to the streets, if you will.

And if you look at Congressman Gingrich when he was speaker, three in to his speakership, there was a conservative revolution because they were concerned that he was not promoting those ideas.

So, when you look at someone in their leadership ability and what they do when inside of the room when nobody else is watching, we were the conservatives that stood up and fought. And Newt was not. And that's what we're looking at in the present. We're looking for someone who can lead and someone who's not afraid to take on those issues and put the real, tough conservative issues on the backburner.

WALLACE: Let's talk about your record as a conservative, senator. When you were in the Senate, you voted against the national right to work law which would have allowed people to get jobs without having to join a union. For years, you repeatedly supported the Davis-Bacon Act which requires government contractors to pay the prevailing wage.

In both of those issues, you sided with big labor, sir.

SANTORUM: Yes. I think if you look back in my track record, I think I had about a 9 percent big labor voting record. You picked out the two.

And you need to remember, I was from the state of Pennsylvania. State of Pennsylvania does not have a right to work law. The state legislature and our governor for a long time had rules in place that were inconsistent with right to work.

And I wasn't, as United States senator, representing the states of Pennsylvania going to go down and by federal vote change the law on the state. I believe the state has the right. If they want a union dues requirement, that the state should be able to do that.

As a president, I have a very different point of view. I have already signed a letter and sent it to the national right to work that I would sign a national right to work bill because now, I'm no longer representing that state.

And by the way, the same thing with respect to Davis-Bacon. My feeling was, again, representing that state, which has a large segment of contractors that work under those provisions that I would protect that right.

Again, as a president, I would have a different view. But I did represent a constituency and one of the things I think is important is to listen and respect the rights of my state.

WALLACE: But how is that different than Mitt Romney who took some positions when he was a governor of Massachusetts and changed some of his positions since then?

SANTORUM: Well, if I was governor of Pennsylvania, I would have worked to change those laws.

WALLACE: But you were senator of Pennsylvania.

SANTORUM: Well, but -- I would change those law within Pennsylvania. But I'm not going to have the federal government change the law for the state of Pennsylvania. It's a very different thing. You work within the people of your state to promote the ideas that you believe in. But you don't have the federal government impose those on the state when the state decided differently.

WALLACE: You are also coming under fire for your tax plan. You would cut the corporate tax rate to 17 1/2 percent for all industries, except that you would cut it to zero for manufacturing.

The conservative National Review says this, "The radical differences between taxes for manufacturing and other activities would introduce perhaps the biggest and most damaging tax distortion in American history. It would also invite endless fraud."

Your response, sir.

SANTORUM: Well, that's just outrageous. The reason that we have a different rate for taxes for manufacturing is because manufacturers face a different playing field. The hotel that is here right now is not going to move to China. It's not going to be -- jobs are not taken and gone and go to Canada.

The bottom line is that foreign competition that is in large part we are being uncompetitive, because of high rates of taxation, because of government regulation and because of government policy generally is making our manufacturing base uncompetitive with the rest of the world.

The rest of our economy, by and large, is domestically based because it serves the domestic economy. Manufacturing is different. It competes with international competition and particularly with countries that want to take those jobs in their countries.

And so, what I've done is look at where government can allow us to compete and if you look at National Association of Manufacturers, what they've said is that if you exclude labor costs and you compare our cost versus our nine top trading partners, we are 20 percent more expensive. There is no way that we were going to be able to keep those jobs for a national security perspective because manufacturing is key to our domestic -- to our security, to be able to have products that are essential for our national security to be made here in America.

WALLACE: Right.

SANTORUM: But it's also key for wealth creation and particularly wealth creation for the blue collar workers in America.

WALLACE: But, Senator, the --

SANTORUM: So, I disagree with those folks. We do need to have a different rate of tax to compete against the Chinas and the Mexicos.

WALLACE: But the counter of that, the argument would be that you are picking winners and losers, that you have -- you're using the tax code to establish an industrial policy.

Let me give you one other example of this, sir, if I may. You have a plan -- as part of your tax plan, you would triple the tax credit for children.

The Wall Street Journal editorial page says this -- "Mr. Santorum is essentially agreeing with liberals who think that the tax code should be used to pursue social and political goals."

And the conservative Tax Foundation gives your plan a D-plus, sir.

SANTORUM: Yes, well, you look at what's going on in Europe today. What they have a tax code just similar -- actually worse than ours with respect to families and children.

And guess what's happening? They have a demographic winter going on. People aren't having children. Why? Because it's so expensive and government does nothing to help them.

They have reached the point right now where they are paying baby bonuses so people will have children.

What's happening in this country -- we've seen a dramatic increase. The child adoption credit or deduction back then used to be 10 times, almost 10 times what it is today. When the government had a policy that said, we want human capital, we need and actually want children to be here in America and the government has a policy of helping and supporting families because children are the greatest resource. They're the natural resource that creates wealth in this country.

And if it wasn't for immigration, our population would be declining. And one of the biggest reasons, Chris, is the financial burden on families. And the federal government over the years has year by year by year decreased support for families. And guess what's happening? Year by year by year, birth rates are going down.

This is not social engineering. What social engineering is the policies of the last 30 years that have robbed family of the support they used to have in the tax code.

WALLACE: Senator Santorum, we got about one minute left and I want to get in to one last issue with you. In the next segment, we're going to debate Newt Gingrich's attacks and the attacks by his super PAC on Mitt Romney's record as a businessman on Bain Capital. I know that you oppose those and say we shouldn't be attacking -- the Republican Party shouldn't be attacking free enterprise.

The speaker now says that the super PAC should either correct its ads or take them down. But the super PAC, and we're going to be talking to one of their senior advisers, says we're not going to do that until Romney clears the record.

Here's the question for you, sir. I know that super PACs are legally independent. But what does it say about the candidate if he can't get a legally independent super PAC that supports him to change its actions, to do something different? For instance, do you think the red, white and blue fund would support you, do you think, if you said, I want you to take down an ad, do you think they'd listen to you?

SANTORUM: I hope so. I hope anybody supporting my campaign would listen to what I have to say. I hope Governor Romney will have his PAC take down an ad that's running against me in South Carolina saying that I want felons to be able to vote. That's an absolute lie.

I voted for a provision that said if a felon serves his term, serves his parole and probation, and then after that period of time, he can be restored his voting rights, which is exactly the law here in South Carolina, that --

WALLACE: If I may, sir, and we got about --

SANTORUM: And so, Governor Romney should be saying to his PAC, take that ad down, it's false. It gives the impression I want people to be voting from jail. And those are the kinds of things if candidates, when they see their super PACs doing things, whether it's Newt Gingrich or Mitt Romney, they should stand up and say, this is false, I repudiate that and they should take it down.

WALLACE: And if the super PAC ignores them?

SANTORUM: Well, obviously, Governor Romney doesn't have the persuasion -- if can't persuade his own people to do something, how is he going to persuade the American public and Democrats to get things done?

WALLACE: You say the same thing for Newt Gingrich?

SANTORUM: I say the same thing with Newt Gingrich.

WALLACE: Senator Santorum, we're going to have to leave it there. I want to thank you so much for joining us and we'll see you down the campaign trail, sir.

SANTORUM: Thank you.

WALLACE: Up next, the big fight over Mitt Romney's business record, is it fair game or an attack on free enterprise? A fair and balanced debate after the break.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP, "KING OF BAIN")

NARRATOR: A group of corporate raiders led by Mitt Romney, the company was Bain Capital, more ruthless than Wall Street.

(END VIDEO CLIP)

WALLACE: Well, that's just a taste of the film "King of Bain," which a pro-Gingrich super PAC is now running in South Carolina. While the Newt Gingrich supporters say they are raising legitimate questions about Mitt Romney's business record, much of the conservative establishment has come down hard on the super PAC and Gingrich for attacking free enterprise.

Here to debate the issue are: Rick Tyler, senior adviser to Winning Our Future, the pro-Gingrich group making the charges. And from Florida, Chris Chocola, head of the conservative Club for Growth, who has called the ads, quote, "disgusting".

Mr. Tyler, Speaker Gingrich called on your super PAC Friday either to correct the inaccuracies of the ads or take them down. Your super PAC said that until Mitt Romney answers some questions, you stand by the ads. Question: why don't you do what the candidate you're supporting is asking you to do?

RICK TYLER, WINNING OUR FUTURE: Well, what the candidate said is that if there are inaccuracies in the ad, we will adjust him. But the inaccuracies in the ad, only Mitt Romney can answer those, although I have some evidence here that, which is the day he left Bain, he claims to have left in August 1999, his spokesperson said yesterday, he left in 1999.

But I have before me, five separate SEC filings and I have many more that he was the CEO and president of Bain Capital as late as May 10th, 2001.

So, that would put all of these questions within the time frame that he says that he wasn't at the Bain Capital.

WALLACE: Let me put up what his campaign said, let's put it up on the screen. This is the issue about the fact that he left in 1999 to run the Salt Lake City Olympic Games. And his campaign issued this response yesterday.

"At that time, 1999, he gave up all management control and operational responsibility over the firm and its investments." Now, you have these documents. But why isn't that statement, that he gave up management control and operational responsibility? Why isn't it good enough for you?

TYLER: Because you can't have it both ways. You can't have an SEC filing which he is a signatory which says that he is the sole shareholder and has controlling interest in these companies.

TYLER: I have DDi right here.

WALLACE: We don't know what DDi is.

TYLER: DDi is one of the companies that's in the --

WALLACE: Oh, yes. OK.

TYLER: Under attack that they say is false.

He was the sole -- he was in charge of Bain Capital as late as May 10th, 2001. So, either he filed a false SEC report which I doubt he did or he's telling the voters something that's not true.

WALLACE: So, bottom line if he stands by the statement his campaign made but he doesn't answer your specific questions --

TYLER: And we stand by the film.

WALLACE: And you're going to keep running the film.

TYLER: Absolutely.

By the way, Glenn Cessler never challenged any of our ads.

WALLACE: We need to say -- Glenn Cessler is the fact checker for The Washington Post.

TYLER: Fact-checker of The Washington Post. He also fact checks hyperbole. I mean, we never made a statement of how many homes Mitt Romney owns. The woman who lost her home said --

WALLACE: But she said in the film it's 13 home.

TYLER: But I think -- she said 15. But it was reaction. It was hyperbole. Are we going to fact check hyperbole? We didn't include that in the ad. We never run in the ad.

WALLACE: Well, it's in the film that you are also running.

TYLER: Yes.

WALLACE: OK. Mr. Chocola, as I said, you are on the record as calling the Bain attack by the super PAC and Gingrich disgusting. You also used the words: economically ignorant class warfare.

What's the problem?

CHRIS CHOCOLA, PRESIDENT AND CEO, CLUB FOR GROWTH: Well, the problem is that Rick and Winning Our Future, his super PAC, are presenting the same vision of free market capitalism that people like Michael Moore and President Obama offer. They take a few facts, snippets of information that they distort. They take it out of context and then they reach the conclusion that it's all like this, that, you know, free market capitalism is nothing more than a bunch of looting rich guys. They get rich at the expense of others.

It's a sad commentary. It's inaccurate. And, you know, the reality is, that free market capitalism has done more for the soul of the human race than any other system.

And it's created the highest standard of living and that's the message that every candidate, presidential candidate in the Republican side should be giving. Not this distorted view that's inaccurate. It's been universally discredited and I think that Rick really needs to take a look when it's been criticized by the candidate he is trying to help, the person who is paying for the ad has distanced himself, the people in the film has said it's misleading and taken out of context. There's really no reason or excuse to continue with this.

WALLACE: All right. Mr. Tyler, and I'm going to give you an opportunity to respond. But I want to ask a question in that contest, because now, you and Speaker Gingrich are saying, well, we are asking for Mr. Romney to clear up the record. But the fact is, over the last week, you've done a lot more than say just clear up the record. You called him a, quote, "vulture capitalist" and here's what Newt Gingrich said this week, let's watch.

(BEGIN VIDEO CLIP)

NEWT GINGRICH, PRESIDENTIAL CANDIDATE: I draw a distinction between looting a company and leaving behind broken families and broken neighborhoods, and leaving behind a factory that should be there.

(END VIDEO CLIP)

WALLACE: I understand that some of Bain's investment went under. But what's your evidence that they were looting companies?

TYLER: Well, take GSI Steel in South Carolina. They shorted the pension fund $44 million and the federal government had to bail them out. Yet, Bain Capital made $17 million on the deal.

I have no argument with capitalism. Vultures, by the way, are good. I mean, I agree --

WALLACE: That was a compliment, calling him a vulture capitalist?

TYLER: Well, look, you have -- he is trying to claim he's a high flying eagle in the business world creating jobs when in fact, you know, Bain, 30 percent of their companies went out of business. And, in business, you know, there's winners and losers. But with Bain, sometimes you win and sometimes you win.

And most of this -- he made money on 90 percent of their deals. That's good. If you were running on the idea that, you know, elect me for president because I return a great investment for my investors, I have not dispute with him. He is running because he says he's a job creator and he's no a job creator. He was the guy who's going in and dismantling companies and destroying jobs. But that's part of the capitalist system. I don't have beef with that.

But don't tell me one thing or other. But why should that be surprising? His record as governor was just as bad -- he's not running his record as governor. He's running on jobs. All I'm disputing is his claim for jobs. That, all of the sudden, the pillars of capitalism are at risk. It's ridiculous.

WALLACE: Well, let me bring in Mr. Chocola again.

Has -- have private equity companies been good or bad for the economy? And in your experience, is Bain Capital an outlier? Is it some kind of bad actor in the markets?

CHOCOLA: Well, I do have personal experience with private equity. My family's business was purchased by a private equity firm. I ran that company for seven years in partisanship with our private equity sponsors. We grew the company in profits and revenue and employment. We ultimately sold that company to Berkshire Hathaway. Today, it's thriving and growing.

I think my experience is much more typical of the private equity industries, than the distorted view that Rick offers. You know, he's not examining Mitt Romney's record. He's offering fiction.

There are actually many things that conservatives should be concerned about Mitt Romney's record. You go to our Web site at ClubforGrowth.com and you can look at the white paper that we wrote about Mitt Romney. But his experience at Bain isn't one of those concerns.

So, he's indicting free market capitalism. He's indicting the private equity business unfairly with distorted snippets of information. And again, it's been universally discredited.

He continues to offer this when his own candidate suggests that it's inaccurate. And so, I think that he has to look at the real record of Mitt Romney which there are things to be concerned about and he should focus on those.

WALLACE: Let me pick up on this, Mr. Tyler, because of the one of the arguments is and they're just -- and we've heard this from Mr. Chocola, there are fiction. There are inaccuracies in the movie you are running.

Let's take one example from your film UniMac which was a company in Florida that made washing machines and I think it's the first big example you used, one of four. Let's watch what you say in the film.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: If they left us alone as UniMac, I think UniMac is still be running around now as UniMac, and still have probably more than 500 employees by now.

NARRATOR: Romney and Bain upended the company and gutted the workforce. Now, they were ready to make a handsome profit.

(END VIDEO CLIP)

WALLACE: Mr. Tyler, here is the problem with that account of what happened at UniMac and we put a time line, let's show it for folks.

Bain bought the company, UniMac, in 1998. Romney left Bain in 1999. You say maybe a little later. Bain sold the company in 2004, it was the new owners, the new owners, the Canadian pension fund that shut down the Florida plant those folks are talking about, in 2005. Mitt Romney had absolutely nothing to do with the shutting down of UniMac.

TYLER: This document right here shows that Mitt Romney was part of Bain as late as 2001 when he said he left in 1999.

WALLACE: They didn't sell it until 2004.

TYLER: What they did, and what those workers, by the way -- you know, I reviewed the entire transcript of their interview. They were clearly talking about Bain was cheapening the quality and gutting the workforce. But this is part of the pattern --

WALLACE: That's not what they say, sir. In fact, the couple that you showed me -- and forgive me, sir. The couple you showed up, Tom and Tracey Jones (ph) say they got a 30 percent raise while Bain owned the plant, and they say they were talking about the people who four years later shut down the plant. They were not talking about Mitt Romney. They also say they were given money to do the interview.

TYLER: And we're glad to release the entire transcript of their interview because you only see part of it in the film, and we'll be glad to release the entire video of the film. And you make a determination. I determined they were talking about Bain. You can speculate --

WALLACE: How can they be talking about Bain shutting down the plant when Bain sold the plant a year before it was shut down by another entity?

TYLER: What they said was I wish that Bain have left us alone back in the early '90s, when they were running as UniMac, because they were running as a fine company until -- what Romney and Bain did typically was go in, load companies with debt, take exorbitant management fees so they couldn't survive in the long term.

So, if they went out of the business in 2005, it's because they could survive -- WALLACE: No, the new owners moved the plant and the business is still running. They moved it from Florida to Wisconsin.

TYLER: It is a typical example -- UniMac is a typical example, like GSI Steel, which had to be bailed out at the federal government.

And by the way, you know, Chris did not watch our movie because it starts out extolling the virtues of capitalism. It does not say that capitalism is bad. It says that capitalism is good.

So, this whole argument that we have this argument of capitalism is baloney.

WALLACE: We got a couple of minutes left, Mr. Tyler. Are you aware that Newt Gingrich was a member of the board of advisers of another private equity firm Forstmann Little between 1999 and 2001?

TYLER: Yes, I was. I've met Teddy Forstmann and, you know, he's a wonderful individual. I know the firm well. A friend of mine worked there for years.

I don't have a problem with private equity firms.

WALLACE: Well, let me ask you about that, because exactly during the time that Newt Gingrich was there, did you know that Forstmann Little invested billions of dollars in two telecommunication firms, McLeod and XO Communications, that both went bankrupt and that Forstmann Little was sued by public employees unions, pension funds, rather, in Connecticut?

TYLER: And I'm sure if Teddy Forstmann ran for president, that would be an issue. The issue here is what Romney is saying?

WALLACE: But why was it OK for Newt Gingrich to be a part of Forstmann Little?

TYLER: I don't have a beef with private equity firms. I have a beef with Mitt Romney's record. I have a beef with this record on life, on marriage, on jobs, on taxes.

Why is it surprising -- Chris Chocola, by the way, of all people, should want to know what his record is with jobs. I --

WALLACE: Do you think it's legitimate issue that Newt Gingrich was a member of the equity firm that invested in companies that went bankrupt and that he was sued by the Connecticut public workers fund?

TYLER: Chris, this is politics. People are going to bring up lots of different issues to try to connect the dots. Mine is simple. Mitt Romney says he is a job creator. This is about jobs in South Carolina. People ought to know that he is not a job creator.

WALLACE: Did you know that in his most recent financial disclosure form, Mr. Gingrich indicates that he still has money invested in Forstmann buyout firm?

TYLER: And I hope that he makes a handsome profit, but this isn't about that.

WALLACE: And you don't see a contradiction between the fact that --

TYLER: No, I don't. No.

WALLACE: You don't see a contradiction between the fact that Newt Gingrich is invested in enforcement (ph) buyout funds and worked for -- and was paid by enforcement (ph) -- and you are sitting here criticizing what Mitt Romney did at Bain?

TYLER: I'm criticizing what Mitt's utterances are. If Newt said, I helped create 11 million jobs, I can back that up, because while he was Speaker they did create 11 million new jobs. They paid off $400 billion worth of debt, they balanced the budget in four years, and they reformed Welfare. That's a record to run on.

Mitt Romney doesn't have a record to run on. He wants you not to know two things -- Newt's record and his record.

WALLACE: Very briefly, 30 percent, Mr. Chocola -- I'll give you get the final word.

CHOCOLA: Well, I mean, that's part of the fallacy of the argument, is the government doesn't create jobs. The private sector does.

I don't know how many jobs Bain created, but if they created one job, they created more sustainable jobs that grow the economy than the government does. Rick Tyler bought this film. He didn't make it. He didn't do his homework. He didn't determine the voracity of it.

He continues to offer it even though it's been universally discredited. It's not an examination of Mitt Romney's record, which should be examined. It's simply fiction, and that's the bottom line.

WALLACE: We're going to have to leave it there.

Mr. Chocola, Mr. Tyler, thank you both for joining us. We'll see how this plays out in South Carolina.

And we want you to know we invited Speaker Gingrich to come on the program today. He turned down our invitation.

Up next, the Republican race heads south and the rest of the field tries to find some way to slow Mitt Romney's momentum. We'll break it down with our Sunday panel when we come right back.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

SANTORUM: It's a very big deal, and it was a very divided group at the beginning. But as they worked through it, they came to a consensus -- an overwhelming consensus.

(END VIDEO CLIP)

WALLACE: Rick Santorum talking to us a few moments ago about the backing he got from a super majority of conservative Christian leaders this weekend.

And it's time now for our Sunday group -- Brit Hume, Fox News senior political analyst; Kirsten Powers from The Daily Beast Web site; Bill Kristol of The Weekly Standard and Fox News political analyst Juan Williams.

Brit, how significant do you think this endorsement of Santorum is by these conservative Christian leaders? There was a summit in Houston this weekend. There were supporters there for Santorum, for Gingrich, for Perry.

On the third ballot by a margin of 3-1 they went for Santorum. How big a deal?

BRIT HUME, FOX NEWS SR. POLITICAL ANALYST: Well, I don't think endorsements by themselves are that big a deal, but it certainly can't hurt Santorum. What Santorum is up against is a problem that two of his fellow candidates are up against, and that is that there are too many of them. And Santorum now has to -- if he wants to get to be the alternative candidate to Mitt Romney and turn this into a long struggle for the nomination, at least two of these other candidates are going to have to get out -- Gingrich and Perry in particular. Ron Paul may fade.

But that's the big problem they face, that they can unite behind one person. But the field is still crowded, and Gingrich, in some ways, is kind of an elephant in the corner of the room because he's got national name recognition and people have heard of him. And a great many people in this country believe he's truly conservative and so on. So he's an obstacle to Santorum, who I think could be a long- term alternative to Mitt Romney.

WALLACE: You know, Kirsten, looking at the numbers, Mitt Romney got 25 percent in Iowa. He got 39 percent in New Hampshire. Those are both good numbers, but that means there are a lot of people who weren't voting for him. Ron Paul is clearly going to get his share of voters. It seems to be around 20 percent. But what are the chances, do you think, that value voters unite around Santorum or any of the other "social conservatives?"

KIRSTEN POWERS, THE DAILY BEAST: Well, I think one of the problems is that -- well, there's two questions. One, are the voters going to listen to these social conservative leaders? That remains to be seen.

The other thing is, they're just a little late to the game. If they were going to do this, they probably should have done it before Iowa. If they weren't going to do it before Iowa, they should have at least done it right after Iowa, when Santorum was sort of surging.

So I think that one of the things -- the reason I think perhaps they're not going to listen to them is what we saw in both Iowa and New Hampshire, is voters are only concerned about the economy. I mean, there's no comparison. Social issues are not even getting on the radar at all.

And Santorum is arguing that, stop the Bain attacks, let's start going after him on abortion and these other issues. But if they vote the same as they've been voting in Iowa and New Hampshire, all they care about is the economy. And Romney wins on that.

WALLACE: So does this have no impact, Bill?

BILL KRISTOL, THE WEEKLY STANDARD: I don't know. That's been my refrain throughout these last few months. And as everyone goes up and down wildly, I think it could help Santorum a lot over the next week, or South Carolina conservatives could decide Gingrich is ultimately the more plausible fighting alternative to Romney. Or they could just splinter and Romney could win with 30 percent, and Gingrich would get 25, and Santorum would get 20, and Paul would get 18, and then we'll go on to Florida.

I don't think -- the one thing I will say is this: as long as Romney -- he will not close out the race by getting 30 or 35 percent. So that would of course be -- it's good to win, and if he gets 35 percent in South Carolina, that will be impressive. But as long, as you just said, as one could plausibly say, gee, 40, 45, 50 percent of the voters might ultimately unite behind a conservative alternative, I think either Santorum and/or Gingrich will stay in the race in Florida and then probably into March, I think. I don't think this race is going to end this month.

WALLACE: Juan?

JUAN WILLIAMS, FOX NEWS POLITICAL ANALYST: Well, I think it's a pretty big deal that he got the Evangelical support. I didn't anticipate it because, as Kirsten was saying, it's late. It's very late in the game. The question is whether it will have any impact.

But it's big for him because he was trailing Newt Gingrich and Mitt Romney in South Carolina. And all of the energy and momentum that he had coming out of Iowa seemed to have dissipated, seemed to have gone away.

The real question was whether he should have skipped New Hampshire and gone directly to South Carolina in order to take advantage of the fact that he has these socially conservative credentials that could have played to that audience better than to a more moderate Republican audience in New Hampshire. It turns out he spent some time in New Hampshire, goes to South Carolina, and it just didn't look like it was having any effect until the Evangelical endorsement yesterday.

WALLACE: All right.

Let's turn to this question of the attack on Romney's business record at Bain.

And the beginning of the week, Brit, Gingrich was, as we saw in the tape earlier, in the last segment, accusing Romney of looting companies. By the end of the week, he was saying, I just want to question his record, I want him to clear up some things. And he was telling his super PAC, fix it, correct all the inaccuracies in it.

Is this Gingrich trying to continue the attacks but distancing himself from the super PAC so he can sort of have it both ways, or do you see any sign that maybe it's having a backlash against him?

HUME: I see some evidence that there's a backlash against it. There are a couple of polls out. One of them is an online poll from Reuters which has Gingrich having fallen back to 11 to 12 percent.

I don't believe that poll is correct. I think he's doing better than that. But I think it is a sign that Gingrich may have hurt himself by this.

And let's remember this about this whole issue about the alternative to Mitt Romney and who gets to be that candidate. Mitt Romney does pretty well among conservatives. Conservatives basically like him.

There's a Gallup poll, a very interesting Gallup poll out, that's been out for several days, that asks about acceptability. And it asks this of Republicans and it broke them down into conservatives and liberals and moderates. Mitt Romney led the pack, acceptable to 59 percent of conservatives. Gingrich was second, at about 50 percent, and the rest were behind that.

With liberals and moderates, he also did 59 percent. Everybody was way behind him on that.

So, the idea that you have a conservative element in the GOP which is dead set against Romney I think is a fallacy, and that as time goes on, this momentum factor that comes from winning, even by small margins, is likely to build. And a lot of conservatives are going to come in his direction. Then it makes it even hard for Rick Santorum and the others to do what they're trying to do.

WALLACE: Kirsten, in the time we have left, let's look at this from the Democratic point of view. How effective do you think Romney has been so far in blunting the attacks that he is some kind of vulture? Which we learned is actually a good thing today. It's a compliment.

(LAUGHTER)

WALLACE: You know, that he's a raider, a looter. How effective has he been in blunting that, and how potent an issue does it remains, if he is the nominee, going against Barack Obama in the fall?

POWERS: I think he's been extremely ineffective, actually. In his most recent interview that he did where he talked about this is about class warfare and this is about envy, that's just not a great comeback to this. And he also said it in his speech in New Hampshire, talking about Obama is trying to dividing us with envy, or whatever. You know, it's not about envy. It's about people losing jobs. And he needs to be able to connect with that and come back with a better defense or explanation for these things, because I do think while maybe it's not going to matter in South Carolina, which remains to be seen, it is going to matter in a larger election.

WALLACE: Of course, in a general election, Mitt Romney can run plenty of ads about people who have lost their jobs in the Obama recession. So they would both be able to attack on that issue.

All right. We have to take a break here. When we come back, a controversial new video could derail peace talks with the Taliban. And a mysterious bombing kills an Iranian nuclear scientist.

We'll ask the panel about both foreign policy challenges. Stay tuned.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

HILLARY CLINTON, SECRETARY OF STATE: Anyone found to have participated or known about it, having engaged in such conduct, must be held fully accountable.

(END VIDEO CLIP)

WALLACE: Secretary of State Clinton's strong reaction to a video that surfaced this week showing U.S. Marines apparently desecrating the bodies of dead Taliban soldiers in Afghanistan.

And we're back now with the panel.

Bill Kristol, what do you make of the administration's condemnation? Appropriate or over the top?

KRISTOL: Over the top. I mean, sanctimonious, self-righteous posturing by the secretary of state and secretary of defense because four enlisted Marines didn't something they shouldn't have done for which they're going to be punished? They probably should get a non- judicial battlefield punishment. And instead, they have to make a huge deal of it to show that, oh, we deplore this.

WALLACE: You're not saying that -- and what the video supposedly shows is four Marines urinating on the bodies of corpses.

KRISTOL: Right, which is wrong and which will be punished by the Marine Corps in the normal course of things. And why the secretary of state and secretary of defense have to opine on this and go out of their way to sort of make -- I mean, to make a bigger deal of it than it is -- and then --

WALLACE: I suppose the argument is it's another Abu Ghraib, that it's going to show the callousness or even worse of U.S. soldiers in the Arab world. KRISTOL: Well, A, it's not another Abu Ghraib. B, it's not clear to me that Abu Ghraib made that much difference ultimately in the Arab world. I mean, we made a lot of the difference -- I think we, by blowing it up, we helped cause that difference.

And also, it would have been nice if the secretary of defense and secretary of state could have said a few things about the 99 percent of Marines and soldiers who have behaved in an exemplary way in Afghanistan and Iraq under very trying conditions. This particular battalion, 32 (ph), suffered deaths, obviously, and a lot of wounded in their tough fighting in Helmand Province. And instead, just to go on TV and sort of just criticize our own trips, I don't think that's a good thing.

WALLACE: Juan, let me come at this from a different angle. The Taliban, which I think we all would agree has a terrible record of brutal behavior, including beheadings, expressed outrage at the video. Here was the comment from the spokesman for the Taliban.

"It was inhuman and despicable, an unforgivable act."

Does the Taliban have standing to lecture us on what's despicable?

WILLIAMS: No, but it doesn't matter. We shouldn't be abiding by the Taliban's standards. We have our own standards and Americans.

I mean, clearly, this was a despicable act. Bill will acknowledge that.

HUME: Despicable?

WILLIAMS: I think it was despicable to desecrate the --

HUME: We eliminate people with drone attacks, kill them.

WILLIAMS: Yes.

HUME: Despicable?

WILLIAMS: Well, it depends if they're you're enemy. No, not despicable -- in a matter of war, killing people, I'm afraid, is part of the --

(CROSSTALK)

HUME: So, killing them is fine. It's just when they're dead and no longer around, if you do something to their body that's worse?

WILLIAMS: I think -- not worse. You make the judgment.

HUME: No, you make the judgment.

WILLIAMS: But despicable? Yes. I said it was despicable. In my judgment, urinating on a dead person is despicable. POWERS: But that's just an unfair argument to -- and this is the one that conservatives are always dragging out whenever liberals make criticisms of things like this, which is, oh, well, we kill people, so therefore we can do anything to them.

HUME: No one said that. Who said that? I didn't say that.

POWERS: The idea is -- it is despicable. I mean, you can say it's despicable and still say that, like, you can kill people in war. The point is that it's conduct unbecoming an officer.

HUME: I agree with that. I just don't necessarily --

(CROSSTALK)

WALLACE: Let me turn this slightly.

Brit, one of the reasons that the administration apparently came out so forcefully is they are now trying to broker peace talks with the Taliban. And, in fact, they're even considering releasing five senior Taliban leaders who are presently being held at Guantanamo. And obviously they're concerned that this video could put a wrench into those talks.

What do you think of the idea of peace talks with the Taliban?

HUME: Well, you've got to be suspicious of peace talks with the Taliban. Can you count on the Taliban to abide by any agreement you would make with them? I doubt it.

On top of that, you have to wonder about this administration with its seeming eagerness to diminish the military and to end these commitments -- because the base of the Democratic Party hates them -- whether they want to enter into peace talks because they think it's a way to get the solution and victory we want or because they want to get out.

WILLIAMS: Well, I think the fact is that everybody, not just Republicans, not just Democrats, but Republicans also, don't like these foreign involvements and think that we've been in Afghanistan 10 years for some questionable outcome. I think the larger point to get back to this incident is that there's a media front in wars these days, and you do not want to give your opponents a recruiting tool.

KRISTOL: Right. And the way to deal with that media front is to say, you know what? Our military upholds standards. These were not officers, these were enlisted men. They will be disciplined in the normal course of things. And we do not need to posture and --

(CROSSTALK)

WALLACE: Guys, I think we've got that. I want to get to this question of the peace talks.

Do we think that's a good idea or a bad idea?

KRISTOL: If they were genuine peace talks which would lead to decent government in Afghanistan, it would be a good idea. If it's just an excuse, a fig leaf for us to get out like the Paris peace talks with respect to Vietnam in '72, then it's a bad idea. And I think it's the wrong thing to do, and we're fighting a war there. It would be nice if we -- and we made a huge success of it, last year, incidentally, last year and a half. And now for us to have the attitude, as Juan correctly says, which I think is the attitude of the administration, of, oh, God, we've just got to get out of there, it's just been too long, it's a terrible message.

It's a terrible thing to do and it's a terrible message to send.

WALLACE: Juan, I want to switch to a different subject. An Iranian scientist was killed this week in Tehran when a hit team put a magnetic bomb on his car right in the middle of rush hour and it killed him. The Iranians immediately accused, not surprisingly, the U.S. and the Israelis of doing it.

When you add this to the Stuxnet computer worm which devastated the Iranian nuclear program and the mysterious explosion at an Iranian missile base -- and this is not the first assassination of an Iranian nuclear scientist -- are we or are the Israelis -- is somebody waging a covert war against the Iranians?

WILLIAMS: Well, you know, I think smart people see patterns, and I think there's a clear pattern here. Something is going on. Somebody is at work, and the fact that the Iranians have been indifferent to international condemnation of the idea that they are developing this nuclear weaponry would make it seem all the more urgent that somebody try to stop them.

Now, unfortunately, from what I've been able to discern, everybody says this is not going to stop them, but it may slow them down a little bit. But, inevitably, they're going to get this nuclear weaponry, and I think that's destabilizing to the Middle East. So whoever is doing this is actually doing a good deed, but the question is whether or not it will have the result, which would be to stop it. And I don't -- apparently, that's not going to have that result.

WALLACE: Brit, what do you think are the chances that these covert actions, combined with what seems to be a newly-invigorated sanctions regime may be sanctioning the Central Bank, maybe the Europeans not to embargo oil from -- imported oil from Iran? What are the chances do you think that they can stop Iran's nuclear program without an all-out military attack?

HUME: "Stop" is a big word. I'm not sure they can stop it. I think they can set it back and continue to set it back and interfere with it and obstruct it. And I think that, on balance, is a very good thing.

WALLACE: Kirsten?

POWERS: Yes. I think the question really is, is it effective? So, obviously, if it was effective, I agree. I mean, there's been a lot of criticism from the left I actually don't agree with, that they claim this is terrorism. But I don't see this as terrorism because, of course, we're trying to stop someone from making an attack, versus attacking somebody just to create terror, which are two completely different things.

The issue is just, like Juan said, will this stop anything? It's not clear if this isn't just, you know, taking out a couple people, but they'll continue with their program.

WALLACE: All right. We're going to have to leave it there.

Thank you, panel. See you all next week.

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

Up next, from New Hampshire to South Carolina, we go "On the Trail."

(COMMERCIAL BREAK)

WALLACE: After leaving the winter blast of Iowa and New Hampshire, the Republican presidential race moved on to the rough-and-tumble politics of South Carolina. And as we found out, the weather and the rhetoric are much hotter there "On the Trail."

(BEGIN VIDEOTAPE)

MITT ROMNEY, PRESIDENTIAL CANDIDATE: The president has run out of ideas. Now he's running out of excuses.

(APPLAUSE)

REP. RON PAUL, PRESIDENTIAL CANDIDATE: He certainly had a clear-cut victory, but we're nibbling at his heels.

JON HUNTSMAN, PRESIDENTIAL CANDIDATE: I'd say third place is a ticket to ride, ladies and gentlemen!

(APPLAUSE)

GOV. RICK PERRY, PRESIDENTIAL CANDIDATE: That's pretty good. Do you want to decide --

ROMNEY: I think the record -- my experience at Bain is pretty well in the open.

PERRY: I understand the difference between venture capital and vulture capitalism.

SANTORUM: People started saying, "Well, did you see he was wearing a vest, a sweater vest?" And so it just sort of took a life of its own that the vest gave me this power. When you're sitting at two percent in the polls, any recognition is a good thing.

(GUNSHOTS)

UNIDENTIFIED MALE: Who were you thinking about when you --

PERRY: Not you.

UNIDENTIFIED FEMALE: Can we get a picture, Mr. Romney?

ROMNEY: Flying babies. Flying babies. Yes, you bet.

PERRY: South Carolina picks presidents, and that's what you all are going to be doing.

SANTORUM: It's a wide-open race, and I just trust the people of South Carolina are going to do their job.

GINGRICH: I will become the Republican nominee because of you, so you can literally change history.

(END VIDEOTAPE)

WALLACE: And we'll see how it all plays out when they vote in South Carolina next Saturday.

But before that, be sure to tune in Monday night at 9 p.m. for our GOP presidential debate in Myrtle Beach. It's sponsored by Fox News, The Wall Street Journal, and the South Carolina Republican Party. And Juan Williams will be one of the questioners.

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

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Sunday July 27, 2014

A number of critical issues loom for members of Congress, as they prepare to leave Washington for the August recess. We'll discuss immigration, spending, the 2014 midterm elections, and the future of the GOP with Rep Steve Scalise (R-LA), in his first national television interview since being elected House Majority Whip.