This is a rush transcript from "Special Report," October 12, 2010. This copy may not be in its final form and may be updated
(BEGIN VIDEO CLIP)
PRESIDENT BARAK OBAMA: Just this week we learned that one of the largest groups paying for these ads regularly takes their money from foreign corporations. So groups that receive foreign money are spending huge sums to influence American elections, and they won't tell you where the money for their ads comes from.
KARL ROVE, FORMER BUSH ADVISER: Does the president of the United States have such little regard for the office that he holds that he goes out there and makes these kinds of baseless charges against his political enemies? This is just beyond the pale. How dare the president do this?
(END VIDEO CLIP)
BRET BAIER: President Obama last week and the Democratic National Committee in an ad are alleging in part that the U.S. Chamber of Commerce is funding domestic political activities with foreign money, or suggesting that, at least. Senior adviser David Axelrod was asked about that this weekend.
(BEGIN VIDEO CLIP)
BOB SCHIEFFER, CBS NEWS: But this part about the foreign money, that appears to be peanuts, Mr. Axelrod. Do you have evidence it's anything other than peanuts?
DAVID AXELROD, OBAMA SENIOR ADVISER: Well, do you have any evidence that it's not, Bob? Why not simply disclose where the money is coming from and then all of these questions will be answered.
(END VIDEO CLIP)
BAIER: The New York Times says it's neither illegal nor unusual. What about this? Let's bring in our panel tonight, Jonah Goldberg, at-large-editor of National Review online, Juan Williams, news analyst for National Public Radio, and syndicated columnist Charles Krauthammer. Charles?
CHARLES KRAUTHAMMER, SYNDICATED COLUMNIST: Well, there is desperation and then there is reptilian desperation. And this is the reptilian variety. This thing just oozes of slime and innuendo.
This is McCarthy-like. You make an accusation that the other side is using foreign funds. You don't have a shred of evidence and you answer like Axelrod what is your evidence, which is what McCarthy did. You'd raise suspicions about someone. And the objective is not to actually make a case but to raise suspicions and leave them hanging out there.
Here are the facts -- the Chamber of Commerce has 110 overseas affiliates which give annual dues. And it is peanuts. It's one half of one-tenth of one percent of its budget.
Also, as The New York Times has written, not me and the not other right wing troglodytes, they have written that this practice of getting dues from the overseas association is not illegal, it's not improper, and it's not unusual.
As we heard earlier in the show, the Sierra Club and the AFL-CIO also had overseas affiliates which give dues and they engage in the political activity. The money from the overseas affiliates is segregated and not used in politics.
The accusation here is that the money is being used again without a shred of evidence. And the irony here is that Obama is a man who ran on hope and change, and this is a pure appeal to xenophobic fear.
Secondly, here is a man who said we have to be one with the world. He stands up in Berlin two years ago in a rally of swooning, cheering Germans, and what does he say? "I'm a citizen of the world." Now his use of the world is as a weapon, the sinister foreigners are influencing our elections in the secret way, again, without a shred of evidence.
BAIER: Juan, it seems the White House will continue to use this attack. The vice president just brought it up a few moments ago on the stump. Bill Burton, the deputy White House press secretary had this to say when asked about it, "The people who want to keep these donations secret are those with something to hide. It's an issue that he," meaning President Obama, "will continue to raise."
What about that as an issue? And would there be potentially some backlash for this as a tactic?
JUAN WILLIAMS, NEWS ANALYST, NATIONAL PUBLIC RADIO: Sure. And I think you're witnessing it as you just described, as Charles just described. The anger, you saw Karl Rove say how could he use the office of the presidency to make a specious charge?"
KRAUTHAMMER: I thought it was restrained.
WILLIAMS: Restrained? One point I would say to you Charles is it's illegal to use foreign money to influence American campaigns.
KRAUTHAMMER: There is not a shred of evidence --
WILLIAMS: But it would be illegal if they were doing so.
KRAUTHAMMER: It would be illegal if you shot somebody, but there's not a shred of evidence.
WILLIAMS: But I'm saying it's illegal for foreign money to influence a campaign.
But here's the larger issue I think from the White House perspective, which that if under these new super PACs you have unlimited corporate money coming into the campaign, they think that favors Republicans closer to corporate America.
Secondly, that under the 501C4s you do not have to identify the source of money coming in. If they don't literally come out and endorse a candidate, they can't coordinate with the parties or with the campaigns, but they can use the issue ads that favor one candidate or another.
And again, the White House feels this is favoring Republican candidates, although Democrats --
BAIER: Isn't that disingenuous? George Soros, unions, liberal groups, and then you go back to the 2008 campaign and online donations -- we still don't know where the online donations from President Obama --
WILLIAMS: Right, but I think we're in a political season and Democrats are using this as a scare tactic to stir the base. And they feel in terms of the anonymous donations made now legitimate with the Federal Election Commissions interpretation of the Citizens United case that they have something they can beat up the Republicans with and stir up the base.
BAIER: Jonah, don't they risk stirring up the base and losing even more independents? There has been a gallop away according to polls of independents from the administration.
JONAH GOLDBERG, NATIONAL REVIEW ONLINE: Yes. I think this is a disastrous move. This has a McCarthy-ite stink to it. And also I think when the New York Times raps you on the nose with a rolled up newspaper and says stop doing something and you keep going it, it makes that part of the establishment angry.
I think you are going to see it's amazing how this president managed to alienate not just his enemies but his friends. This is such a sad farcical display that we're seeing from the guys, where they know it's not true. It's like the president is sitting around reading the left wing blogs.
BAIER: It started on Think Progress, the left wing blog.
This is the latest Gallup poll, just out before if show. The Congressional generic ballot, the question, Republican high turnout, 53 percent, Democrats 41 percent. And if it's a low turnout scenario, 56 to 39. This is relatively unchanged from the last time Gallop asked the question, Charles, and these are huge numbers.
KRAUTHAMMER: Relatively unchanged and historically unique. We've never seen such a spread for Republicans. And it tells us it will be a wave election. The only question is whether in the last week or two there might be a slight reversal of this to save a few marginal Democratic seats. I think this is really telling and will tell you about the election.