• This is a partial transcript from "Your World with Neil Cavuto," October 2, 2006, that was edited for clarity.

    NEIL CAVUTO, HOST: My next guest is running for governor of California. He's running against the current governor, Arnold Schwarzenegger.

    But, to hear some of his anti-war speeches and the like on the campaign trail, you would almost think that the California state treasurer Phil Angelides was running against the president of the United States. The latest polls show him trailing Governor Schwarzenegger by 17 points.

    So, is anti-war the wrong message in that state?

    Reaction now from the treasurer himself.

    Do you think that is the case?

    PHIL ANGELIDES,D-CALIF. GUBERNATORIAL CANDIDATE: Hi, Neil. How you doing today?

    CAVUTO: I’m fine.

    ANGELIDES: Good.

    Well, first of all, let me just say something. I believe that every citizen, every leader has an obligation to speak out and express their views on this war. And I — I believe this war is wrong. It’s harming our country. It’s harming California. It’s endangering our nation’s security.

    And, Neil, if I am governor of the state of California, I’m going to be commander in chief of the National Guard. And our National Guard is being harmed by the double and extended tours of duty our Guardsmen and women are doing in Iraq.

    The Guard here is 20 percent below its authorized strength. Re-enlistment is down. Recruitment is down. And we need the Guard here at home to protect us against disasters: flood, earthquake.

    CAVUTO: Well, you might — all right. Let’s — let’s give you the benefit of the doubt, Treasurer, and say what you say resonates. In the polls, it doesn’t seem to connect.

    And — and given the fact that you have tried to link Governor Schwarzenegger with the president, do you think — and it — we still have some weeks to go here — that — that that coupling has been a political mistake?

    ANGELIDES: Oh, no.

    Look, first of all, I believe this war is wrong. And I’m going to express my views as I believe...

    CAVUTO: All right. I know the war is wrong. Granted...

    (CROSSTALK)

    CAVUTO: ... war is wrong. You don’t like it.

    But linking that in a state that has other issues...

    ANGELIDES: And — and...

    CAVUTO: ... are you essentially just sort of handing this one off to the governor?

    ANGELIDES: Oh, no.

    Look, the reason the governor is ahead in the polls — and, by the way, in every credible poll, he is still stuck in the mid-40s — is, he has spent close to $35 million in negative attack ads on me since I won the Democratic nomination.

    And, in the closing five weeks of this campaign, you are going to see a very close-run election, because Arnold Schwarzenegger, like George Bush at the federal level, has done the wrong things for California. He has borrowed billions, when he said would he balance the budget. He has cut education. He has turned young people away from college. He has cut health care for kids.

    And, look, I have a different vision for what will make us strong. And I will say this: On fundamental policy, whether it is privatizing pensions or borrowing against our kids, George Bush and Arnold Schwarzenegger stand together.

    My vision is very different. Neil, I think we ought to balance our budget, after seven years of deficits. I believe we ought to give a tax break to families making $100,000 or less a year, not more tax breaks to multi-millionaires and the big corporations.

    CAVUTO: Well, I — you know, it is funny you mention those points, Treasurer, because I was reading in some of these articles in the California press, among — even your supporters said, if Phil Angelides did more of that, this would be a tighter race.

    What do you make of that?

    ANGELIDES: Well, we’re doing — we are doing plenty of that. I think what you see is, because the war in Iraq is such a matter of national concern, when I speak out on it, a lot of the press covers it, as we are doing today, Neil.

    But the heart of my campaign are the fundamental differences between Governor Schwarzenegger on one hand and me on the other. And, look, I am going to balance our budget. I’m going to give a tax break to middle-class families. I’m going to lower college tuition and fees. I’m going to fully fund education in the state. That's at the heart of my campaign.

    And, sadly, it is really Arnold Schwarzenegger who has been the guy who has gone all over the country. He went to Ohio for George Bush. He has gone on a lot of national TV and radio shows, saying he thought the war was the right thing to do.

    So, look, I’m expressing my view on the war.

    CAVUTO: It sounds to me — it sounds to me, Treasurer, you are going to keep pounding this war thing through the end of it...

    (CROSSTALK)

    CAVUTO: Right?

    ANGELIDES: Well, the war is wrong.

    CAVUTO: OK.

    ANGELIDES: The war is wrong. And I always speak up on my views.

    CAVUTO: I am not saying that’s — that’s wrong for you to make that a campaign issue.