• This is a rush transcript from "The Journal Editorial Report," January 23, 2010. This copy may not be in its final form and may be updated.

    PAUL GIGOT, HOST: This week on the "Journal Editorial Report." Obama's next move. How will the White House respond to Republican Scott Brown's victory in the Bay State? We'll preview next week's State of the Union address.

    And handicap. The chances of still passing health care reform.

    Plus, a landmark Supreme Court decision up ends decades of campaign finance law. What it means for the mid-term elections ahead.

    Welcome to the "Journal Editorial Report." I'm Paul Gigot.

    First up tonight, Obama's next move. Will Tuesday night's stunning upset in Massachusetts cause the president to shift to the center or further to the left?

    Democratic pollster Doug Schoen, joins me now with his take on the lessons learned from the Bay State.

    Doug Schoen, welcome.

    DOUG SCHOEN, DEMOCRATIC POLLSTER: Thanks, Paul.

    GIGOT: Good to have you back.

    So you've worked in the White House, the Clinton White House, after a defeat like this. Tell us about the debate inside about how to respond?

    SCHOEN: Well, in the Clinton White House, Paul, there was no debate. There was a clear recognition by the president he had to move to the center, be pro balanced budget, fiscal discipline, job creation, moderate social.

    GIGOT: After 1994.

    SCHOEN: That's correct. I think in this White House, as your question suggests, there will be a huge debate between the populous on one hand led by people like David Axelrod.

    GIGOT: Who is the chief White House political adviser.

    SCHOEN: Yes, he is, and the counselor to the president, and other more pro business, centrists like Rahm Emanuel, who were there in '94, '95, '96, and saw how repositioning the president got him reelected.

    GIGOT: Let's take an issue like health care, and how does that debate manifest itself, the centrists, the people that want to move to the middle. What do they do? Do they try to get some Republicans on board and then craft a bipartisan plan?

    SCHOEN: They should. Their position is the Republicans don't want to do bipartisanship, so hence, incrementalism is the word of the day. That makes sense if they can get insurance reform through, cover preexisting conditions and portability and the like.

    GIGOT: Smaller bits.

    SCHOEN: Smaller bits. And if they can get the Republicans in, Paul, it not only pays dividends to the country, it pays dividends politically.