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This is a rush transcript from "The Beltway Boys", December 8, 2007, that has been edited for clarity.

FRED BARNES, FOX CO-HOST: Mitt Romney tried to put questions about his Mormon faith to rest. We'll tell you if evangelicals are buying it.

MORT KONDRACKE, FOX CO-HOST: Hillary Clinton sees the lead slipping in Iowa and New Hampshire and steps up.

BARNES: And Iran a danger despite new intelligence.

KONDRACKE: A plan to ease the Mortgage mess and not everybody is happy about it.

BARNES: It's all coming up next on "The Beltway Boys", but first the headlines.



MITT ROMNEY, (R), PRESIDENTIAL CANDIDATE: I believe that Jesus Christ is the son of God and the savior of mankind. My church's beliefs about Christ may not all be the same as those of other faiths. Each religion has its own unique doctrines and history. These are not bases for criticism, but rather a test of our tolerance.


KONDRACKE: I'm Mort Kondracke.

BARNES: I'm Fred Barnes and we're "The Beltway Boys."

And the hot story, number one, Mort, is a switcharoo. I'm talking about tactical changes in the campaigns of Mitt Romney for the Republican presidential nomination and we had Hillary Clinton for the Democratic one.

And we saw a part in that bite at the beginning Romney talk background Jesus Christ. That's a part of the switch. It is a part of the speech, the one he gave on Thursday in Texas on his Mormon faith, a speech he's been reluctant to give, but he decided the time was now and he gave it. I think it's actually helping him. I'm not sure of whether Hillary's switch, which we'll get to later, is helping her.

Romney, now, this speech was designed to deal with what is at least a perceived problem that there are qualms among voters particularly conservative Christians about his Mormon faith. And I thought his speech was effective. It defended his faith and very strongly, and particularly dealt with, in a very — I thought — smart way. His chief rival in Iowa, the first event in the presidential race, the Iowa caucuses, that's Huckabee who is a Baptist minister, who has said that his faith defines him. And he's run an ad touting himself as a Christian leader.

Very cleverly, Romney respond today that this way. Watch.


ROMNEY: I do not define my candidacy by my religion. A president should not be elected because of his faith nor should he be rejected because of his faith.


BARNES: That was good there. Romney's goal in the speech was to place Mormonism in the mainstream of the American religious tradition and said Mormons like other Christians and so on, he says — he says Mormons are Christians or at least applied that in the speech. He didn't actually say it. That they all agree on this creed of moral convictions.

And the key here was, after the speech was what was the response of conservative Christians? And so far, so good. We've see, for one, Richard Land, who is an extremely influential Southern Baptist leader, responded like this. Watch.


RICHARD LAND, SOUTHERN BAPTIST CONVENTION: He will get a, a second hearing or a more — a second look from a lot of Southern Baptists. But you know, look, Kennedy didn't change everybody's mind with his speech and the governor's not going to change everybody's mind with his speech.


BARNES: Mort, you know Richard Land pretty well. And I do too. Pretty favorable coming from him. And more important, Jim Dobson said focus on the family, and said, "Governor Romney's speech was a magnificent reminder of the role religious faith must play in government and public policy. His delivery was passionate and his message was inspirational." So I would say, on net, his speech was a positive.

KONDRACKE: Politically speaking, the speech was necessary for him to give because he's dogged by Huckabee and because the Mormon issue is big among evangelicals. This was the right moment for it. Right now is when he gets maximum attention and he got those kudos, as you point out, from religious leaders. And I thought it was an eloquently written restatement of mainstream religious values.

But in a way, it was typical of Romney. He said — he said, I'm not going to define my candidacy according to my faith and then he proceeds to define his religious convictions as, as you've said, you know, Jesus Christ is the savior of mankind. This was not John F. Kennedy's speech. John F. Kennedy, for one thing took questions, lots of questions from those southern ministers in 1960. He took no questions.

Secondly, John F. Kennedy said that there was an absolute wall between church and state. And Romney didn't say there was any wall at all. So far I could tel.

BARNES: He said there was a wall, he just didn't...

KONDRACKE: It's not very thick. And thirdly, there was nothing in this speech. He said that I'm going to be the president of all the people, but he didn't even mention, didn't even bow his head to people who were nonbelievers. Of course, nonbelievers tend not to be Republicans or vote in the Republican primary.

BARNES: Yeah, for sure. OK. We'll turn to Hillary Clinton. OK? She is sinking, almost everywhere, in polls, among the Democratic presidential candidates. Let's see — well, maybe the not everywhere, maybe only in Ohio, new Hampshire, south Carolina, Nevada the early primaries. And her response has been to go on the attack ferociously against her chief rival Barack Obama. And here is her justification for this. Watch.


SEN. HILLARY CLINTON, (D), PRESIDENTIAL CANDIDATE: I have said for months that I would much rather be attacking Republicans and attacking the problems of our country, because ultimately that's what I want to do as president. But I have been four months on the receiving end of rather consistent attacks. Well, now, the fun part starts.


BARNES: Look, the fun part, the fun part? You know, I don't think of Senator Clinton as a fun person. But maybe I've been wrong.

Now, here is what her biggest problem is and that is — it's just the way that Barack Obama is campaigning, and the message he puts out. Watch this new ad being shown in Iowa by Obama.


SEN. BARACK OBAMA, (D), PRESIDENTIAL CANDIDATE: We are in a defining moment in our history. Our nation is at war. The planet is in peril. The dream that so many generations fought for feels as if it's slowly slipping away. And that's why the same old Washington textbook campaigns just won't do. That's why telling the American people what we think they want to hear, instead of telling the American people what they need to hear, just won't do. America, our moment is now.


BARNES: Whew. That's hard to attack.

KONDRACKE: Right, well, I think it's a great ad. And it goes on. I think you, tonight, play the best part, the end of it. He says, look, I don't want to fight the 1990s wars all over again. I don't want to be the president of Red America against Blue America, and so on. I want to be the president of United States of America. This message of uplift, post partisanship, get problems of America solved. I think that's exactly what America wants to hear.

And at the rate things are going, Hillary Clinton is going to lose Iowa and could lose New Hampshire and South Carolina. If she does, she's finished.

Now, what she's doing is she's getting nasty. She's sounds whiney. She's looking desperate. And you know, as I say, Obama is coming on strong and he's cool about the whole thing. And at the rate things are going, I say, again, she's going to lose.

BARNES: So Obama is winning.

KONDRACKE: Yes, absolutely.

BARNES: What about Romney?

KONDRACKE: I think Romney at the moment is going to win Iowa and New Hampshire, too.

BARNES: I agree on both counts.

KONDRACKE: OK, coming up, the growing flap over those destroyed CIA tapes. Plus, the fallout from the Intel report on Iran's nuclear program. Is it a threat or is it just game over.


KONDRACKE: Welcome back to "The Beltway Boys."

Hot story number two is two black eyes. And that's the two black eyes taken by the intelligence community. One, the CIA revealed it had destroyed videotapes of the harsh interrogations of two terrorist suspects. And apparently, the CEO lied when it said that it had fully informed the House and Senate Intelligence Committees about all this, because Jane Harman, Democrat, and Pete Hoekstra, Republican, who were House Intelligence Committee chiefs at the time said they were never told about this.

The other black eye is that the intelligence community did a 180 on the issue of whether Iran has a nuclear program, a nuclear weapons program going. In 2005, they said with high confidence that Iraq had such a program. Now they're saying with high confidence that they stopped the program in 2003. And they think they haven't resumed it.

Now, this has created a big, a big flap, both on the right and left. Lots of conservatives are questioning the — whether this new report was fairly arrived at. And Democrats of course, are saying — accusing president Bush of having lied about height of the threat of that Iran presents.

Here is Bush's response to all of this. Watch?


GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I still feel strongly that Iran is a danger. Nothing's changed in this NIE that says, OK, why don't we just stop worrying about it. Quite the contrary. I think the NIE makes it clear that Iran needs to be taken seriously as a threat to peace.


KONDRACKE: Well, about nothing's being having been change, it's au contraire because this report takes off the table the military option. Bush cannot attack Iran's nuclear facilities anymore. I mean, he couldn't get American support for it.

BARNES: He wasn't going to anyway.

KONDRACKE: OK, but he had the threat in — and he was scaring lots of Americans along with the Iranians. I don't know how much he scared the Iranians. But Bush is right about the danger that Iran continues to present. I mean, this NIE, if you read it — and lots of Democrats don't and the press doesn't either — says that Iran still is working on enriching uranium and still building missiles. And they don't even know for sure that Iran hasn't resumed its nuclear program.

BARNES: You're right. Iran is a threat. But this report is a threat as well because it's a threat to the efforts by the Bush administration and some others to continue or increase the pressure on the Iranians to stop doing the one thing that matters.

Look, the sanctions that have been applied, the weak ones. And the stronger ones sought were based not on this weapons, so-called weapons program which was discovered in 2003. The Iranians have never acknowledged they had it and apparently abandoned it. It was based on what is still going on. This massive uranium enrichment where the fear is that the enriched uranium can be used eventually for a nuclear weapon, which is exactly what we don't want. But that threat still exists entirely. But you know, this report coming out and it has completely undercut any effort to put pressure on the Iranians and the sanctions will certainly — they may get softer, but not tougher.

On this thing about the videotapes for the CIA, guys, look, if they were — if these things were subpoenaed, you break the law if you don't hand them over. On the other hand, if they were handed over to Congress — some parts of Congress anyway, you can imagine seeing the tapes on al- Jazeera, CNN or FOX some day, which wouldn't be good. And if there's harsh interrogation, sometimes harsh interrogation is a good idea.


KONDRACKE: Well, look, I agree that interrogation — that there ought to be the option at the CIA for harsh interrogation. On the other hand, you would think that — frankly, I suspect that there are lots of tapes of this kind of thing and that the CIA would tape this in order to have a record to go back over it and see if they missed something and so on.

Now, I don't think that they ought to ever be made public, but I do think that they ought to be shown to members of Congress if they indeed produce good actionable intelligence — as the CIA and the Bush administration claim — that they ought to be available to try to convince those members of Congress that are convincible that we're getting good intelligence out of them. And I think it could be a help, but destroying them and then lying about it, not good because the CIA doesn't have a lot of credibility at the moment.

BARNES: Destroying them is one thing and lying about it is something else, which they shouldn't do.

KONDRACKE: Yeah, what apparently the CIA learned was that the lesson of Richard Nixon, you remember?


KONDRACKE: If Nixon had destroyed the tapes. he'd stayed out of trouble.

BARNES: Indeed.

KONDRACKE: Coming up, Bill Clinton adds another title to his resume', media critic. Next, time is running out for Congress to get its work done before the Christmas break. And the finger pointing is underway.


BARNES: Welcome back to "The Beltway Boys."

Let's check out our "Ups and Downs" for the week.

Down: Bill Clinton. I know it pains you to hear this, Mort, but the former president is backtracking on comments he made about Iraq and claiming an unfair shake from the press. To refresh your memory, here is what he said last week.


BILL CLINTON, (D), FORMER PRESIDENT OF THE UNITED STATES: Even though I approved of Afghanistan and opposed Iraq from the beginning, I still resent that I was not asked or given the opportunity to support those soldiers.

So, what did we do? We borrowed the money to give Bill Clinton the tax cut and pay for our soldiers.


BARNES: He got that part right. OK, here is what he said this week when asked if he had any concerns or regrets about those comments? Quote, "Well, I regret that they were falsely represented by the press who wants to make it a political story," unquote.

KONDRACKE: Well, what he meant was, of course, when he said he was against Iraq from the beginning that was different from what his wife had said that's how it became a political story. Now, the press did not falsely report what he said. They reported what he said. You know, and now he's claiming it's false. But I've said all along — and you're tweaking me for it — that Bill Clinton is a big net plus for Hillary Clinton. The good Bill was a — a net plus for Hillary Clinton, but lately he had been, you know, lately...

BARNES: The environment, the Clintonian...


KONDRACKE: Lately he has been self-indulgence. He's been Clintonian. He's been whiney and the bad Bill is not good for Hillary after all.

BARNES: Weasley twisting of the truth. You know, I think there's something at play here more than that. And I've said all along I didn't think that Bill Clinton would be a great help to his wife. He overshadows her. He's big and he makes her look small. And that doesn't help somebody who's running for commander-in-chief as Hillary Clinton.

I think people — not just me and not just you — but vast zillions of America, are tired of the Clintons. They're tired of this to-ing and fro- ing and explaining and confusing and the stuff we've talked about. They are tired of it. I think it hurts her. And look, we saw the great ad by Barack Obama. That, I'll have to say, is inspiring and refreshing. It's something new and — well, anyway you get the drift.

KONDRACKE: I get the drift. And I agree with the drift too.

Down: Congress. With time running out on the legislative year, and a very long to-do list ahead, the Democratic leaders are blaming President Bush for the lack of progress. here is Harry Reid's slap down and president Bush's response.


SEN. HARRY REID, (D), Nevada: We begin this year with great success. We've restored integrity in Congress. We put working families first. We put people to buying homes and veterans care. And a funny and unfortunate thing happened next, the president and his Republicans supporters here in the Senate determined that though bipartisanship make good policy, obstruction made better politics.

BUSH: The most disappointing thing about Washington has been the name calling. And you know, those kind of people go out in front of mics and kind of unleash. And I've tried hard not to do that.


KONDRACKE: He doesn't name Cal, no, he just vetoes. He vetoes things and threatens vetoes and he gets your friends, the Senate Republicans, to obstruct by filibustering so there's gridlock. And you know, the public is fed up with it.

Now both sides at this particular moment are playing chicken with the budget, with Iraq war funding, with the alternative minimum tax fix, all of that stuff. There are deals to be had and there will be deals had.

Now, the deal that — the clear deal here is for the Democrats to give Bush the clean Iraq funding that he wants. They're not going to block Iraq funding. They ought to give him what he wants. They ought to get, in return, at least half of the extra spending that they want and that he's threatening to veto. And that's $11 billion dollars out of a $3 trillion dollar federal budget. It's peanuts and Bush could yield on that and he ought to yield on that.

And on the alternative minimum tax fix, which costs $50 billion dollars a year, Bush is going to win that, I think, because the Democrats are afraid that people are going to have to file two sets of tax returns in 2008 if they don't.

But what is the Bush principle here? The Bush principle is not to pay for the tax increase, even though it costs money. The Bush principle is it to borrow the money and have your kids pay for it.

BARNES: It's not a tax increase. What it's doing is hoping it keeping it as a tax, the AMT, exactly where it was last year.

KONDRACKE: But it costs money.

BARNES: That's not a tax increase.

KONDRACKE: It costs money.

BARNES: Sure, if you raise taxes and if you have a tax increase coming and you don't implement it, it costs money.

KONDRACKE: It means less revenue.

BARNES: They don't need that revenue. Look, Democrats had a choice all year, ever since they took over. The choice is between bipartisan bills and Democratic failures. And they've had it all along but they choose not to do it. They choose to put through things they know aren't going to pass. The failed AMT things and energy bill, an easy deal there. Just have the energy production there in addition to the other pie-in-the- sky stuff the Democrats have. Look, what's what you have to do with cafe standards. That's what you have to do — you can have compromises. But as of now, there's one problem on the Democrats in the Senate, Harry Reid can't count. He only has 50 or 51 votes. That's not enough. It's as simple as that.

OK, up: Treasury Secretary Hank Paulson. After weeks of cajoling and bargaining, he finally struck a deal with the nation's mortgage companies to freeze interest rates for some subprime mortgage holders.

Now, I think that Harry Reid did — it shows once again how important it is to have a heavy weight, like Paulson, as Treasury secretary. And he's come up, as I said, cajoling those other Mortgage holders to get them to reexamine all of their troubled subprime loans, to find out those that you can — quickly, find out those that you don't have to foreclose on and you can freeze their interest rates from going up over five years. And then they may get a million or more of those. This is a good way to do it. It cost the taxpayers nothing and it minimizes the moral hazard what would happen if you came in and forced the mortgage holders to do a freeze.

KONDRACKE: I agree with all that. And I think that Paulson is doing the right thing.

Hang on to your hat, "The Buzz" is next.


BARNES: What's "The Buzz", Mort? It better be good.

KONDRACKE: It is. You know what the Clinton people are hoping will save them in Iowa? The Orange Bowl factor. That is, after the first ballot when Richardson, Dodd, Kucinich and Biden's voters don't win and don't get 15 percent, they will leave and go watch Kansas versus Virginia Tech and not vote for Obama on the second ballot.

BARNES: The word "pathetic" comes to mind. A man to watch in Washington, starting right now, Jon Kyl, senator from Arizona, new Republican whip, a conservative, smart, but also, the way he won and completely flummoxed Lamar Alexander to win the job as whip was impressive. He's going to be a force for good and...


KONDRACKE: Lamar Alexander got what he wanted.


BARNES: He got number three.

That's all for "The Beltway Boys" this week. Join us next week when the boys will be back in town.

Watch "The Beltway Boys" Saturday at 6 p.m. ET and Sunday at 1 and 6 a.m. ET

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