'Special Report' Panel on Obama's Flip-Flop on Public Financing and Congress' Compromise Over the War Funding Bill

Published June 20, 2008

| FoxNews.com

This is a rush transcript of "Special Report With Brit Hume" from June 19, 2008. This copy may not be in its final form and may be updated.

(BEGIN VIDEO CLIP)

SEN. BARACK OBAMA, (D) PRESIDENTIAL CANDIDATE: I would be very interested in pursuing public financing, because I think not every candidate is going to be able to do what I've done in this campaign, and I think it is important to think about future campaigns.

This is our moment, and our country is depending on us. So join me and declare your independence from this broken system, and let's build the first general election campaign that is truly funded by the American people.

(END VIDEO CLIP)

JIM ANGLE, GUEST HOST: There is Barack Obama in a clear about-face on accepting public financing for the presidential campaign.

Now some analytical observations from Fred Barnes, Executive Editor of The Weekly Standard, Mort Kondracke, Executive Editor of Roll Call, and syndicated columnist Charles Krauthammer, FOX News contributors all.

So he had clearly pledged that he would do this. Suddenly, he has found problems with the public financing system — Mort?

MORT KONDRACKE, EXECUTIVE EDITOR, ROLL CALL: They call that "liar, liar, pants on fire."

The editorial pages of the country raged at Obama when he started considering doing this. We will see whether in the aftermath, now that the nominees are picked, whether they continue the barrage. Barack Obama has proved, like every other politician, that winning is the main thing, or perhaps the only thing.

This whole idea that the system is broken and all that — the system is broken, but it is the primary system that is broken, which limits the amount of money that you can spend on every state, and limits the total amount of money that you can spend so you do not have any money in the summertime to campaign. And both he and McCain opted out of that.

But in the general election, they would be even-steven at $84 million, and it would be a fair fight. And he started saying that McCain won't stop 527s, independent committees. Well, there are plenty of Democratic 527s independent committees as well.

ANGLE: Obama made this sound like a virtue today that he was foregoing $84 million in public funding. But let's listen to how John McCain characterized it.

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN, (R) PRESIDENTIAL CANDIDATE: Millions of people have pledged their confidence in him and his word, that his word is good. It is very clear now that at least in this instance — and this is a big deal — he has completely reversed himself and gone back not on his word to me, but the commitment that he made to the American people. That is disturbing.

(END VIDEO CLIP)

ANGLE: Charles?

CHARLES KRAUTHAMMER, SYNDICATED COLUMNIST: McCain is right. He said he would not — do it on his own, and he is. He changed his mind, and his excuses are really pathetic.

What he said about the independent expenditures, he says it is because McCain will not stop independent expenditures. He knows that it is against the law for a candidate to communicate with independent expenditure committees, so he could not stop them even if he wanted to.

And the idea that he has discovered that the system is broken is hilarious because he declared this a year ago, and the system has not been changed in a year between when he declared and when he woke up this morning and discovered it is a broken system.

This is simply another piece of empirical evidence that the way he was been characterized by the man who has known him the longest and best, except for his wife, is true. Jeremiah Wright had said he is just a politician.

It will be interesting to see, as Mort indicates, whether the press has placed him on a pedestal as a guy who hovers above all politics and is a new apparition in a world of politics, is what he is, which is an ordinary, ambitious guy who flips and changes if it suits him.

FRED BARNES, EXECUTIVE EDITOR, THE WEEKLY STANDARD: Do not bet on the mainstream media coming through here.

This campaign is about one thing. It is not McCain. It is about Obama and is he who he says he is? He says he's for public financing, and then he backs out. He says that he will meet John McCain to debate anytime, anyplace. It turns out he will only do it on July 4, who knows where, when nobody is watching television.

He says he is for energy independence. But now he's for windfall profits tax on the oil companies that everybody knows — it is provably true- -that it will reduce energy independence.

McCain could make a lot out of this, but I'm not sure how much. On the other hand, if I were the campaign manager for Obama, I would have gotten out of public financing, and I wouldn't be going to those town hall meetings either.

ANGLE: People are expecting him to raise, what, $200 million?

KONDRACKE: Frankly, I do not think he is going to suffer for this at all. One, the press is not really going to hound him, and, secondly, the public does not really like public financing. They do not contribute to the system of their income tax, and I think they kind of admire the ability of Barack Obama to raise half a billion dollars in small donations.

KRAUTHAMMER: Obama will turn it into a virtue. He will say that John McCain is living off your taxes.

ANGLE: I want to squeeze something in here. We have a new Fox poll out today. First, it shows Barack Obama leads John McCain 45-41. That's still pretty close. Both campaigns put a lot of emphasis on independents. McCain leads Obama 38-30 there.

And at this point, Clinton supporters, who are still a little irritated — 68 percent of them will vote for Obama, up from 47 percent in April — 17 percent would vote for McCain, 15 percent remained undecided.

BARNES: The bad number there for McCain is not independents. It is only 81 percent among Republicans. George Bush always got 90, 92, 94. McCain has to get about 10 percent more Republicans back.

ANGLE: But Obama only gets 81 percent among Democrats.

BARNES: Yes, but he can get away with it. There are more Democrats than Republicans at the moment.

KONDRACKE: And the electoral college is way shifted in Obama's favor. It's his to lose at this point.

KRAUTHAMMER: And the Clinton supporter numbers is bad for McCain. It's as expected that as the sting of her loss wears away, I think almost all of them will flock back.

ANGLE: OK, when we come back the all-stars comment on the compromise on Capitol Hill over the War Funding Bill.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

REP. NANCY PELOSI, (D) CALIFORNIA, SPEAKER OF THE HOUSE: Among those members who would not be happy about the Bill not having a date certain, count me among them. And that is why I am voting against the war supplemental part of the Bill

REP. JOHN BOEHNER, (R) OHIO, HOUSE MINORITY LEADER: Unilateral defeat, unilateral surrender, which is what the Democrats have wanted, will leave us with an unstable Iraq, a place where Al Qaeda would have had free access and a base of operations.

(END VIDEO CLIP)

ANGLE: A miracle on Capitol Hill00a very contentious issue — future funding for the war in Iraq and Afghanistan — is going through Congress without any conditions whatsoever, such as a date for withdrawal.

You heard Nancy Pelosi there, Speaker Pelosi, refer to it. And this is going to sweep through the congress. A compromise was reached behind closed doors, and now we have had one vote so far, overwhelming vote in favor.

Charles, what is going on here? I thought a lot of Democrats were insisting on a date for withdrawal.

KRAUTHAMMER: Let me start by saying that, with respect, most surrenders are unilateral.

ANGLE: Just to correct the record on that.

KRAUTHAMMER: I had to do that to show that I'm fair and balanced.

The Democrats clearly don't want to debate on this. A year or two ago they would have had a long debate and denounced the war. They do not want to have this as an issue. They do not want to be seen on the floor arguing for unilateral surrender.

And I think this tells you what has happened with this issue. The facts on the ground have changed so dramatically, so undeniably, that Democrats, I think, are understanding that the war may not be a plus.

I think that McCain can make it a plus. He can win a significant argue by arguing that Obama's position of withdrawal on a timetable, which essentially means abandoning Iraq, would be a disaster.

And I predict that between now and election Obama will switch his position. He will gradually start to say that a timetable is an objective, is a goal, but he'll adjust according to what his commanders have told him and according to conditions on the ground.

If he doesn't — and McCain should hammer him every day on this issue, because Obama and the Democrats position is essentially for a disaster in Iraq which need not happen because of the way the fortunes of the war have changed.

ANGLE: Even if he does not change his position between now and the election, this provides funding for a year from now, so all the way up until next summer. So he would have plenty of time, if he were elected, once he got into office, to say that things are going well.

KONDRACKE: I think he is already sliding in that direction. He had a conference call with Iraqi foreign minister who came out of it saying that there is not that much difference between Obama and McCain as to keeping troops there.

ANGLE: The Obama people, for the record, said that is not exactly what he said.

BARNES: And the Obama people were right.

KONDRACKE: About this Bill — this Bill has $63 billion in it in GI Bill funding, which is fine except that it is not paid for. There is no fiscal responsibility left in Washington whatever. They just pass Bill after Bill, nobody worries about the deficit or the national debt. Just shoved along and have our kids paid for it.

BARNES: Republicans won the big part of this, no deadline, and they gave away a couple of things — the GI Bill stuff that Mort talked about, and extending unemployment benefits, which will ensure that people stay unemployed longer. And these were things that a lot of Republicans were going to vote for, and Bush's veto would be overridden.

I think tomorrow they will bring up the Terrorists Surveillance Bill, and Democrats have given in on that too. The telecom companies are going to get immunity, and then some other things that the Democrats want, some Inspector General study of the terrorist surveillance since 9/11, and so on. But Republicans won the big ones and gave up some little ones.

ANGLE: Now, we talked about how this helps Obama if he were to get elected. Charles, how would it help McCain if he were elected?

KRAUTHAMMER: It is a way of saying in advance that his policy is essentially endorsed. His policy is withdrawal on conditions that our military sets. I think it is a way of saying that public opinion has shifted. I think it would give him a mandate if he won.

If he ran on this issue he would have a mandate to actually win this war.

ANGLE: Anyway, they have time after they get into office to see whether things are going well or not.

BARNES: What would be interesting is to see what Obama says after he goes to Iraq, whenever it is, this summer.

ANGLE: That's it for the panel

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