Rove: Obama administration's fight in contraception mandate a combination of arrogance and having ideological blinders on

Watch the latest video at FoxNews.com

This is a rush transcript from "On the Record," February 9, 2012. This copy may not be in its final form and may be updated.

GRETA VAN SUSTEREN, FOX NEWS HOST: Right now, Karl Rove joins us. Nice to see you, Karl.

KARL ROVE, FOX NEWS CONTRIBUTOR/FORMER BUSF ADVISOR: Great to see you, Greta.

VAN SUSTEREN: OK, first of all, is this fight over contraception -- is it sort of something that we were talking about today and tomorrow, maybe yesterday, and couple more days from now, but come November, this is going to have zero impact on 2012, or is this -- this is a big issue?

ROVE: This is a big issue. Look, the biggest group of swing voters in the electorate are Catholics. They represent roughly 25 of the electorate. In any presidential election in the modern era, Catholics have tended to go with the winner. Bush won them in 2000, 2004, and Obama won them in 2008. And it's been thus for decades.

And this is -- essentially, the federal government has taken the stance that the Catholic church must offer insurance coverage to its employees of all its schools, churches, foundations, charitable institutions, and so forth, insurance coverage on contraception, and including the after morning pill that runs directly counter to the church's teachings! And this is a big issue!

You know, to me, I'm astonished at the president that he does not recognize that there ought to be a place in the public square for institutions, religious institutions to live by the moral precepts that undergird their faith.

And this is not the first time but the fourth time that the administration has taken a -- made an attack on the beliefs of Catholics, three of them involving questions of religious liberty -- this one, where they're requiring them to buy insurance.

There was a Supreme Court case where the federal government, the Justice Department argued that religious institutions should not be able to hire people or fire people on the basis of their religious beliefs. And the Supreme Court argued against -- held against the administration on a 9- 0 decision! This administration succeeded in doing that very rare thing, and that is unifying the Court.

And then we had in the Affordable Care Act a refusal to allow Catholic hospitals and other religious hospitals whose moral precepts oppose abortion to opt out of providing abortion services by what's called the conscience clause. And instead, they said, It doesn't exist. We don't care if you're a Catholic hospital or a Lutheran hospital or any kind of a -- a hospital that's connected with a faith that has a strong moral precept against abortion and a strong moral support for life, you've got to provide these services.

So it's beyond me why they're picking this fight, and the president has picked this fight and dug in his heels on it.

VAN SUSTEREN: Well, if you go to the Obama campaign website -- I went there to try to sort of understand a little bit more the various views on this, political views, is that on their website, they say 99 percent women have used contraception, 98 percent Catholic women have used contraception. And it is being -- it is being positioned not as religious fight or religious freedom, but rather a women's right in an effort to, I think, galvanize the women's vote. Am I wrong on that analysis?

ROVE: No, sure. That's -- obviously, they're going to try and declare that this is a women's health issue. But that's -- that's what's is so wrong about this. They're just -- they justified saying to a Catholic doctor in a hospital run by a Catholic -- you know, by Catholic nuns that, You have to be willing to commit abortion, even though the leader of your faith and the doctrine of your church says no!

And so, you know, look, and they -- and these phony numbers could be concocted on anywhere. But the fun -- this is -- this is how blind they are. They're saying to people, We want you to do things which are morally objectionable to them.

Let's say you're Seventh Day -- you're a Jehovah's Witness who is a pacifist. We've had this battle once before in our country, and the Supreme Court upheld the right of Jehovah's Witnesses to refuse to serve in the military because it was fundamental to their faith!

And now we're saying on an even bigger, broader question, You, a -- the Catholic church, you know, Catholic university, or the archdiocese of Philadelphia have to provide insurance coverage that includes in it something that runs counter to your deeply held religious beliefs!

This -- and you know, we have a thing called the Bill of Rights. It guarantees the free expression of religion. And here the government is saying, You have a right to believe anything you like, except if we don't agree with it, and if we want to justify it on the basis of women's health, you've got to take your fundamental commitment to life and throw it aside in a casual manner! And this is -- this is obnoxious to a lot of people!

I'm not a Catholic, but I feel deeply and keenly about the issue of life, and I understand how important it is to the thread and warp and weave of the Catholic church. And the president is saying to the Catholic church, You don't have any freedom as a religious institution that I cannot trample with an executive order out of the Department of Health and Human Services!

VAN SUSTEREN: I'm trying to figure out why this happened because it would have been very easy not to pick this political -- not to pick this fight. If it's political, I'm trying to understand the political advantage to the Obama administration. It may -- in my mind...

ROVE: It's not political.

VAN SUSTEREN: In my mind, it might have been an -- sort of, quote, an "accident," meaning HHS has got some people writing rules and they weren't thinking, or it was deliberate and sort of a -- a know it all and we're going to tell you what to do and we think this is the best. Which is it? Or something else?

ROVE: Look, it's not -- it was not a political calculation that this is going to win us votes. It was an ideological commitment to doing what they think is right, regardless of the consequences. And we saw this start in the Affordable Care Act.

I mean, again, I repeat, there's a deliberate effort to say to religious hospitals and religious health institutions, You don't have a right to refuse to do something that violates your fundamental moral precept of support of life and in opposition to abortion!

We saw it when they said, Look, a religious school has to take anybody as a teacher or a faculty member. You don't have a right to say, as a religious institution, that people who share your faith ought to be teaching your schools. And the Supreme Court by a 9-0 decision said the Obama Justice Department was mistaken in its belief and that the Constitution guaranteed the freedom of religious institutions to do that!

And now we see it a third time. It is an ideological mindset that tramples on the right of religion because these are secular individuals, by and large, who have no respect for the fundamental importance of religious institutions in our society or the rights under the Constitution, the 1st Amendment of the Constitution, to freely express their religion and to encourage and call upon their members to live by the moral precepts of that church!

So I mean, look, this president is -- I love it! They said, Well, we're open to a compromise. What's the compromise? The compromise is, Well, we'll give you a certain amount of time, six months or a year, to figure out how you're going to do this. So yes, you got six months to a year to figure out how you're going to fundamentally violate your moral precepts! How -- how -- how outrageous is that?

VAN SUSTEREN: Is this -- and if I can sort of try to understand -- is this arrogance on the part of the administration, basically, Tough, we won, you're going to do it our way or we're not going to accommodate the sort of collective views in the country of people from all walks of life? Is that how you see it?

ROVE: I think that's a big part of it. I think also part of it is an ideological blindness that says, Look, we worship at the altar of, you know, reproductive rights. We -- you know, abortion, contraception, morning after pill -- these are more important than us respecting the Constitution's guarantee of the right of free expression of religion.

And we're going to define what your religion is. And anything that doesn't agree with us and our moral -- and our secular views, no matter how important its moral -- it is to your moral foundations, is out the window.

And yes, so it's a combination of arrogance and it's a combination of ideological blinders and it's a question of complete tone deafness. There are reports today that Bill Daley, outgoing chief of staff, said to them, Hey, don't do this. This is a needless fight. Look at it! We've got Joe Manchin of West Virginia. We've got Tim Kaine, who was Obama's Democratic National Committee chair and a Catholic running for the U.S. Senate in Virginia running like a scalded dog from this!

We got Bob Casey. We got -- we got one of the members of the House Democratic leadership, John Larson of Connecticut. We've got -- you know, we've got Lipinski of Illinois, all standing up, saying, Don't do this. This is wrong. And you know, we're -- this is going to cause a huge problem for the president, particularly since he doesn't seem to know how to get out of it.

And I don't think he wants to! I thought his comments today -- I mean, he is more afraid of Barbara Boxer and -- and -- and -- and the -- and the pro-abortion crowd in the Democratic Senate caucus that he visited here in the last day or so than he is of -- of every cardinal, every bishop, you know, every priest, every nun, every brother in the Catholic church!

I mean, his attitude is, That doesn't matter to me. I just got to go placate my left-wing allies, the secular left wing, not -- and not worry about, you know, what used to be the bulwark of the Democratic Party, working-class Catholic households. They're out!

VAN SUSTEREN: All right, let me look beyond...

ROVE: A new crowd is in!

VAN SUSTEREN: Let me look beyond the sort of the -- the issue for a second. And let me be coldly political about this and say, you know, this is an issue everyone's very passionate about today. We're in February. What makes you think that this has staying power come November 2012 and that it'll affect a vote because when we're immersed in these big fights, it seems like it's going go on forever. We're all going to remember it. But then a couple months go by, and it's sort of, like, you know, contraception what?

ROVE: Yes. Well, look it's like this is a fire that's going to burn brightly outside the media's glare because the media -- look, Brent Bozell earlier this evening on Hannity's program pointed out how many days it took for the networks to begin to cover this after the rule passed. But it didn't take that long for the bishops to circulate a letter that was read in every Catholic parish two weeks ago, two Sundays ago, that was a powerful statement of opposition on the basis of religious freedom to the administration's action.

That's going to continue. I've been talking today with a group of people led by Ed Gillespie, who are talking about a grass roots movement across the country to deal with this issue because it's a powerful issue. And again, I repeat it is among a group of voters whose direction absolutely turns, you know, one -- the election one way or the other.

And this is going to hurt the president among Latinos. It's going to hurt him amongst Catholics. It's going to hurt him among evangelicals and biblical Protestants. And it is -- it is going to be -- it is -- look, you've had people come out who said, I'm not -- you know, I'm not particularly religious, but I agree with you. You had Joe Lieberman, an Orthodox Jew, say, I think this is trampling on religious freedom.

This is about the right of a church to have institutions and people that work for that institutions who abide by the moral precepts of that religion. And if you establish the government can discard as deeply held a belief as respect for life that exists at the heart of the Catholic church, then the government can take away everything connected with religion!

VAN SUSTEREN: All right, does -- suppose President Obama says tomorrow, You know, I've thought about this, I see how distress is. I think it was wrong, or whatever, or I want to make sure that -- you know, that we don't step on the rights -- religious rights of people. I -- we're going to do away with this aspect of the rule. If that happens, does that change the political dynamics, or is this now stuck to him? And do you think -- or do you think he's incapable of changing his mind?

ROVE: Yes. I think it'll be stuck in some people's minds for a while. They will say, I don't trust the president after this. But you know, look, he violated the church's precepts when it came to the conscience clause. In fact, there were a lot of Roman Catholics in Congress who voted for it thinking that he would, you know, apply a religious exemption, and they didn't. And it hurt the president in the 2010 election, when Catholics voted overwhelmingly for Republicans for Congress.

But I think if he quickly withdrew the regulation, then I think he would limit the damage here. There'd still be some damage, but you'd limit it.

But you know what? His statements don't -- his body language doesn't sound like -- like it is, I mean, like he's going to be open to withdrawing the regulation. And neither have the statements of people like David Axelrod or Jay Carney. I was amused when -- when -- when Axelrod said, yes, we're open to compromise. We're willing to give time to figure out how they can abide by the resolution -- by -- abide by the regulation. So in other words, we'll give you six months, 12 months, and you figure out how to commit suicide, rather than us killing you right now.

VAN SUSTEREN: All right, let me change just for -- to CPAC for a second. Tomorrow, Governor Mitt Romney is going to speak. And I suspect that out of the candidates -- out of the candidates that are going to speak, Romney, Santorum and Gingrich, that he probably has the hardest reception tomorrow. Maybe not. But what does he have to say to convince them that -- you know, to vote for him, these -- this very conservative group of Republicans?

ROVE: Yes. I think he has to start by not -- by describing who he is and what he believes. I don't think he has to start by saying -- on a defensive note by saying, Well, I know -- I know some of you skeptical of me. He needs to just treat them as what they are, which is, you know, potential part of his coalition, and describe to them who he who he is and what he stands for.

And yes, he does need to address their skepticism, but it's best addressed, in my opinion, by describing who he is and what he's all about. And then he ought to try and tap on some -- touch on some reasons why they ought to trust him.

I mean, you know, look, remember four years ago, he gave one of the best, most well-received speeches at CPAC. Now, unfortunately, it was the speech in which he declared he was no longer a candidate. But you know, he's -- he's got enthusiasts within that crowd, and he's got a message that can win adherents to him. It did so in Florida. It did so in Nevada. It did so in New Hampshire. You know, he's got plenty of friends there, and the question is, does he make the best case to them?

VAN SUSTEREN: Karl, we'll be watching to see what happens tomorrow with CPAC. But actually, one more quick question before I go. I just want to ask you about your op-ed piece about the Southern strategy for Newt Gingrich. I meant to ask you about that.

ROVE: Right. Right.

VAN SUSTEREN: What do you think of that strategy?

ROVE: Yes. I don't think it'll work. First of all, there are a lot more -- out of the 25 contests in February and March that he was talking about, 18 of them are outside the South. Only 7 of them are in the South. About 579 delegates outside the South, 371, I think it is, in the South.

The problem is, he can't compete for all the Southern delegates because neither he nor Santorum got on the Virginia ballot with 49. Second of all, the contests in the South tend to be proportional, and that means that, you know, Mitt Romney, even if he loses, is going to get a significant slug of delegates. And most -- five of the races outside the South, one is winner-take-all, Arizona, and then there are four so-called proportional hybrids, where most of the delegates are winner-take-all, and that's going to advantage Romney if -- if -- if Gingrich is focusing only on the South.

And then, of course, Gingrich has got to get past Santorum and Paul, who aren't getting out of the race.

VAN SUSTEREN: Karl, thank you. Straight ahead...

ROVE: You bet. Thank you.