• This is a rush transcript from "Your World With Neil Cavuto," August 7, 2008. This copy may not be in its final form and may be updated.


    GOV. TIM PAWLENTY (R), MINNESOTA: People want to follow hopeful, optimistic, civil, decent leaders. They don't want to follow some negative, scornful person.

    Video: Watch Neil's interview with Minnesota Governor Tim Pawlenty

    So, you know, say what you will about Barack Obama — and I say a lot of negative things about him — and we need leaders. And John McCain is positive as well. But people gravitate when you got something positive to say.


    NEIL CAVUTO, HOST: Well, you know, the media jumping all over those comments, Republican Governor Tim Pawlenty — he's been bandied about as a possible running mate for John McCain — saying some nice things about Barack Obama, but he also said those same nice things about John McCain. Somehow, that did not make it into wire stories.

    I spoke to Governor Pawlenty about that just a few minutes ago.


    CAVUTO: Governor, I know you certainly meant well and were being kind in your remarks about Barack Obama, but that's all a lot of conservatives were talking about today.

    What did you make or do you make of the — I don't know if you would call it a mini-dustup over your magnanimous comments?

    PAWLENTY: Well, what I tried said — and I think what I said, if you look at the whole statement, is, he tries to be positive in his rhetoric, and he offers positive-sounding rhetoric, but his record is awful. And, so, those two things don't match up. But he attempts, in his rhetoric to be positive, as does Senator McCain, as do most candidates. Obviously, they're not going around being only negative.

    So, I don't think it was meant to be a compliment. It was meant to state the obvious, which is, he attempts to have positive rhetoric, but still has an awful record, and he's not ready to be president, in my view.

    CAVUTO: All right.

    Now, one of the big arguments that has been raised in this battle for a running mate for John McCain is that he needs relative youth and someone the conservative part of the party admires. You seem to get a check on both counts. Has he or have his people been sizing you up?

    PAWLENTY: Well, I have just stopped talking about the V.P. stuff, Neil, because, every time I used to talk about it, I would say something one word different than I would said before. It would set off another round of articles.


    PAWLENTY: It just leads to more speculation. A lot of it is misguided and — and wrong. And, so, I just don't engage in it anymore, but I appreciate you asking.

    CAVUTO: Could I ask you this, though, if you will indulge these obnoxious lines here, that — that it would be wise for Senator McCain to choose a conservative figure? The argument goes that he needs to shore up that base for the party and to keep them loyal into the fall.

    Others argue that conservatives have nowhere else to go, he should reach out for a moderate, to even liberal running mate.

    What say you?

    PAWLENTY: Well, if you're going to win an election, you have got to build a coalition, starting with making sure you have the support of your base. And, in Senator McCain's case, he has done a good job of consolidating the Republican base. He's getting support from Republicans at the same level or higher than other Republican presidents or candidates at this point in the race. So, he's done that.

    I still think you want somebody who is acceptable and exciting to Republicans, but also perhaps somebody who has some appeal to independents or Democrats, so you can make the coalition even bigger and increase the chances that you're going to win.

    But you can do that with a mainstream conservative, or somebody who's acceptable to the Republican Party. Senator McCain is going to have a lot of good choices in that regard.

    CAVUTO: Still, Governor, there are some conservatives in the party who were a little concerned when Senator McCain recently would not make an ironclad guarantee about sticking to tax cuts. I'm — I'm paraphrasing here, but that he laid open the possibility — didn't say it in so many words — that taxes could go up under certain circumstances.

    PAWLENTY: Well, Neil...

    CAVUTO: What about just a no-tax-pledge, sticking to it, pounding it, repeating it?

    PAWLENTY: In fairness to Senator McCain, he did come out shortly after those initial concerns and definitively clarify his statement, saying he was opposed to tax increases.

    So, over the years, I think he's said, in the context of a Social Security discussion, he would — he would have a discussion, at least, about anything. But, as it relates to tax increases, he clarified his statement very promptly after that concern was raised to say he wasn't going to raise any taxes.

    CAVUTO: Is it your view, when it comes to Social Security, Governor, that we should raise the retirement age eventually?

    PAWLENTY: No, that's not my view.

    I think we need to move towards, in my view, individual accounts for those who are interested or capable or able to manage and have those kinds of accounts, and give people the option to have that type of system, to choose to, if they would like.

    CAVUTO: All right. So, when it comes to the president's tax cuts, if you were to let a couple of them, one of them expire, is that a tax hike?

    PAWLENTY: Well, I think, if you benchmark it against the current revenues and current tax code, if you have a tax that is going to go up compared to where it is now, yes, that's a tax hike.

    CAVUTO: All right.

    Now, you closed a $4.5 billion gap in the Minnesota state budget without raising taxes. But, later, conservatives piled on you, because they said you threw in fees and the like that were really largely earmarked for a new stadium.

    Having said that, you really do have to be truer than blue on this issue, don't you? Does it worry you that, whether it's fees or services, or anything like that, that this could be a problem for almost any Republican?

    PAWLENTY: Well, when I ran, and we had the big deficit, I said we were going to raise some user fees. And, so, that wasn't, you know, a new thing.

    We did have a stadium built in Minneapolis, but the state didn't pay one dime for that. We allowed the local county, if they wanted to, to raise the local sales tax, but we didn't do that as a state or as a state legislature. We just gave them the authority to do that locally, if they wanted. And there are some other things, as well.

    But, as a Republican, as a conservative, you know, if we lose the mantle of being fiscally disciplined, the people who are going to keep a lid on taxes and spending, then we really just become the lite version of the Democrats. And I don't think that's helpful in terms of what we believe and what we stand for, and the ultimate success of our party and candidates.