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Transcript: John Podesta on 'FNS'

The following is a partial transcript of the Nov. 9, 2008, edition of "FOX News Sunday With Chris Wallace":

FOX NEWS SUNDAY HOST CHRIS WALLACE: I'm Chris Wallace and this is "Fox News Sunday."

A moment for history, and now it's time to work.

(BEGIN VIDEO CLIP)

PRESIDENT-ELECT BARACK OBAMA: I'm confident that a new president can have an enormous impact.

(END VIDEO CLIP)

WALLACE: As President-elect Obama prepares to govern, what are his priorities? We'll find out from John Podesta, head of the Obama transition team.

Then, Republicans are reeling on Capitol Hill. What can they do to repair the GOP brand? We'll talk with two rising stars in the House who are poised to move into key leadership roles — Eric Cantor from Virginia, and Mike Pence from Indiana.

Also, what campaign promises will be at the top of the Obama administration's to-do list? We'll look ahead with our Sunday regulars — Brit Hume, Mara Liasson, Bill Kristol and Juan Williams.

And we'll show you the entire campaign in three minutes when we take a final trip "On the Trail," all right now on "Fox News Sunday."

And hello again from Fox News in Washington. Well, after a remarkable campaign and a sweeping victory on Tuesday, President-elect Obama begins the tough job of building his team.

Here with a look at how the Obama administration will get under way is John Podesta, the head of his transition team.

And welcome back to "Fox News Sunday."

OBAMA TRANSITION TEAM CO-CHAIR JOHN PODESTA: It's great to be with you, Chris.

WALLACE: President-elect Obama made it clear in his Friday news conference that job one is the economy, but he left it unclear how active, how involved, he's going to get before his inauguration.

Will he give congressional Democrats clear direction about what he wants them to do in a lame duck session on economic stimulus?

Will he actively engage with the Bush administration on the financial bail-out, or is he going to wait until he takes the oath of office?

PODESTA: Well, we have one president at a time, as President- elect Obama said on Friday, so it's up to — the job is up to President Bush to move that legislation forward and try to keep economic recovery moving today.

But I think what the president-elect wanted to do — he sent a strong signal that we need an economic recovery program moving forward. He'd like to see the stimulus that's pending on Capitol Hill pass.

He wants to see unemployment insurance extended, aid to the states that are struggling with medical insurance — and try to fix their problems and their own budgets so they don't need to lay people off, and try to get job growth going again.

He hopes that will happen during this lame duck session, that the — that President Bush will cooperate. If it doesn't, it would be the first item of business when he comes back.

WALLACE: But for instance, on the financial rescue plan, there are some decisions that are going to be made over the course of the next two months on things — various financial institutions, how to spend that $700 billion, even talk about appointing a permanent head of the — to deal with the rescue.

If the Bush administration asked President Obama — President- elect Obama, "What do you think of this? Will you sign off on this person," is he going to say, "Yes," or, "I'll wait?"

PODESTA: Well, I think that he's going to put his own people in place when he comes to office, and we're moving very aggressively to select both people at the top for cabinet secretary, treasury secretary in particular, but we're also looking at people below the level of cabinet secretary — the undersecretary for domestic finance, the head of the TARP, the so-called TARP, et cetera.

So he's going to put his own team in place. In the meantime, he's designated Dan Tarullo as one of his senior economic advisors to — to have discussions, to be fully informed, fully briefed, with what's going on right now.

Mr. Tarullo has reached out to Secretary Paulson. They've already spoken. They're meeting tomorrow. And we'll have other people who are available to be at the Treasury to understand the decisions that are being made.

But we have one administration at a time. And those are decisions that the Bush administration needs to make while they're in office.

WALLACE: Does the president-elect feel some pressure to name his treasury secretary and his economic team first and quickly to reassure the financial markets?

PODESTA: Well, I think across the board, whether it's national security, the economy, the senior leadership that will manage health care, energy and the environment, I think he intends to move very quickly.

And you know, he's beaten a lot of records during the course of the campaign. I think people probably don't know this, but with the exception of President Bush 41, which was an intraparty transition, no new president has named a cabinet secretary before December, going back through the Kennedy administration.

And I think we're moving aggressively to try to build out that core economic team, the national security team, and you'll see announcements when they're ready.

But again, I'll reference back to what he said on Friday. He said he wants to move with all deliberate haste, but he put the emphasis on deliberate. So he's deliberating what — the strongest team that he could put in place to manage the very, very difficult problems the country is facing, and there will be announcements forthcoming.

WALLACE: Your transition team has reportedly already identified a number of areas where he could issue executive orders as soon as he takes office to demonstrate — first of all, to solve problems that he thinks needs solving, but also to demonstrate quickly that change has come to Washington.

What's at the top of the list?

PODESTA: Well, I'm not going to preview decisions that he has yet to make. But I would say that as a candidate, Senator Obama said that he wanted all the Bush executive orders reviewed, and decide which ones should be kept, and which ones should be repealed, and which ones should be amended.

And that process is going on. It's been undertaken...

WALLACE: Can you give me an idea of a couple of areas that...

PODESTA: Well, I think across the — I think across the board...

WALLACE: ... could be — like, for instance, stem cell research, he could end the federal restriction on that by executive order, correct?

PODESTA: I think across the board, on stem cell research, on a number of areas, you see the Bush administration even today moving aggressively to do things that I think are probably not in the interest of the country.

They want to have oil and gas drilling in some of the most sensitive, fragile lands in Utah that they're going to try to do right as they — walking out the door. I think that's a mistake.

But I think that we're looking at — again, in virtually every agency to see where we can move forward, whether that's on energy transformation, on improving health care, on stem cell research.

There's a lot that the president can do using his executive authority without waiting for congressional action, and I think we'll see the president do that to try to restore the — a sense that the country is working on behalf of the common good, that we're going to try to restore wages, give people the right kind of ways that they can build on their own lives, and when they work hard that they'll be rewarded for it.

WALLACE: On the big legislative initiatives, the things he's going to have to go to Congress for, such as the economy, and health care and energy, have any decisions been made?

And as a former White House chief of staff under Bill Clinton, do you have any thoughts on how many he can take on at once? And is there a danger of trying to do too many things at the same time?

PODESTA: Well, there's always a danger of trying to, I think, sort of, if you will, clutter the agenda.

But I think one of the things that Senator Obama, again, showed during the — during the campaign — and I think what we're trying to do during the transition is be very disciplined about the strategy to actually execute against the programs that he laid out, the promises he laid out, to cut taxes for the middle class, to provide health care for everyone in an affordable way...

WALLACE: But he's not going to try to do it all at once.

PODESTA: ... and to try to deal with energy transformation.

I think that he said that these — these top-tier issues need to be addressed. They need to be addressed immediately.

The question that I think faces him now and Senator Biden — and during the course of the transition — is what's the strategy that allows you to tackle those problems in a way — in a parallel fashion, simultaneously, so that we can improve the lives and well-being of the American people.

There's a big national security agenda, obviously, as well, and we'll have to — and so that there — there's a lot to be done, but I think he has the capacity to do a lot. And he's a transformational figure, and I think he's going to transform the way government acts as we move forward.

WALLACE: Does Mr. Obama feel he won a mandate in this election?

PODESTA: I think he feels like there was a strong vote for change. And I think that if you look at that from the perspective of where he won across the board, his appeal to independents, to Republicans, which I think will be reflected in the kind of government he builds — and you saw not just red states turning blue.

You saw red counties turning blue. You saw young people embracing the Obama presidency in great numbers, a lot of people going to the polls and then voting for President Obama. Again, across the board, across the country, Democrats, independents and Republicans...

WALLACE: But the question...

PODESTA: ... voted for him. So I think that he feels like he has a real mandate for change. We need to get off the course that the Bush administration has set.

WALLACE: But the question, of course, is what kind of change. I want to put up something that the liberal economist Paul Krugman wrote in a column in the New York Times this week. Let's put it up.

He wrote, "This year's presidential election was a clear referendum on political philosophies, and the progressive philosophy won." Do you agree?

PODESTA: Yes, I do. I think that the program that that — again, that was — that — that the Obama-Biden ticket put forth in the campaign focused on providing opportunity for everyone, focused on the common good.

And I think that's in the progressive tradition in this country. It was alive and well in both parties. It sort of got extinguished in the Republican Party over the course of the last couple of decades, but I think that that progressive vision of providing opportunity for people who work hard, providing for the common good, to helping people succeed in their own lives — I think was what he laid before the American people.

It's in that great tradition of progressive politics in this country. And it's a tradition of reform. And I think he'll deliver on all those elements.

WALLACE: Let's talk about the transition process. Obviously, you didn't want to talk about this before the election, especially...

PODESTA: Right.

WALLACE: ... with Senator McCain hitting Mr. Obama for being presumptuous and measuring the drapes.

But how far along are you? What decisions — what directions did he give you? And what lessons has he and have you learned from mistakes perhaps made, let's say, by the Clinton administration transition?

PODESTA: Well, we got — we got started early. He asked me...

WALLACE: How early?

PODESTA: Well, we were up and working as early as early August. I talked with the White House chief of staff several times before the election. We had meetings at the White House.

We pre-cleared under the intelligence legislation that was passed in 2004 100 people who now have security clearances so they're able to go in the agencies and be fully briefed on the important national security matters facing the country.

We began building out a personnel file to be able to make choices rapidly during the course of this transition period. That was all guided by a diverse board of 14 people who were strong supporters of the campaign.

And as we move into the new transition, we've now — we have a Web site up. We have our space built out. We're — we have space in both Chicago and Washington, and we're up and working and running.

WALLACE: What lessons have you learned from mistakes made by President Clinton and other administrations in terms of how to do this transition differently?

PODESTA: I think one of the most critical things is that it was — that we focused on was it was important to name a White House chief of staff early and build a White House staff right from the beginning to go along with the cabinet's election process.

And that's why, as you saw, President-elect Obama named Rahm Emanuel chief of staff two days after the election. He's in the process of building out the White House staff. And as he does that, we'll turn over authority to him.

In the meantime, as you know, he and I are close friends and allies, so we're working cooperatively...

WALLACE: Are you making a conscious effort to look for Republicans in the cabinet? Are you making a conscious effort on diversity both in terms of race and gender?

PODESTA: Absolutely. And I think that you'll see, again, a cabinet that looks like the way President Obama ran his campaign. He brought millions of people in. They weren't all Democrats. He reached out to independents and Republicans.

And I think we want to see that reflected at every level of government. Sometimes there's a token Republican in the cabinet or token Democrat in a Republican administration.

I think his charge to us is that he wants a broad diverse cabinet, one that's built on — first criteria is excellence. And that's what we're trying to produce.

WALLACE: There's always controversy. Your day job is — you're the head of a liberal think tank, the Center for American Progress, and you have come under some criticism for not disclosing who your donors are. This is perfectly legal.

But can you understand where some people, given the fact that you're playing a key role in staffing this administration, would wonder who your financial backers are?

PODESTA: Well, you know, first of all, all of our major financial backers are out in the newspaper, and you can go read them. And the 58 foundations that support the senator are out there and available.

We apply the rule that — that under the law — we're fully compliant with the law. Most of the people who give us money are very well known, and I'm proud of what we've been able to build over the last five years. The Center for American Progress, I think, was an important institution in terms of developing ideas.

But I think the most important point, Chris, is that our work is public. When we do an analysis, it's not hidden. It's not secret. We publish it. It's on our Web site.

If you want to know what we think, it's right out there. And so you can criticize what our ideas are. You can argue that, you know, we're too left, we're too center. Very few people argue that we're too far to the right, but I think that...

WALLACE: Well, there probably are some now.

PODESTA: But what we do...

WALLACE: But let me just ask you...

PODESTA: ... what we do is open, plainly available. Go to our Web site, AmericanProgress.org, You see what we're — you see what we're for and what we stand for.

WALLACE: It's been reported but never confirmed — is billionaire investor George Soros one of your big contributors?

PODESTA: It's been — it's been reported, and I've confirmed that. He was an early contributor. He's not our largest contributor. He's not — but he was — he was one of the people who gave us money at the beginning to get us started.

WALLACE: And finally, any chance that you will pull a Dick Cheney as the head of the search team and actually become a part of the administration yourself?

PODESTA: No, I've made it very clear to President-elect Obama and Vice President-elect Biden that I will be the most unpopular man in Washington come January 20th for having said no to so many people, and that I'll kind of ride off into the sunset at that point and go back to the center and try to do what we do well, which is to produce policy ideas and criticize the administration when we think they're doing the wrong thing.

WALLACE: Really? Mr. Podesta, we want to thank you for coming in today, and you're going to be one busy man over the next couple of months.

PODESTA: Thanks.

WALLACE: Up next, we'll hear from two young gun House Republicans on where their party goes next. Back after the break.

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(COMMERCIAL BREAK)

WALLACE: And we're back now to talk about the future of the Republican Party with two rising GOP stars — from Richmond, Virginia, Congressman Eric Cantor, who was in position to become the number two Republican in the House.

And here in studio, Indiana Congressman Mike Pence, who's set to move up to the number three spot.

And, Congressmen, welcome back to "Fox News Sunday."

CONGRESSMAN MIKE PENCE: Thank you, Chris.

WALLACE: Congressman Cantor, you just heard John Podesta, the head of the Obama transition team, talking. He said that he believes that Election Day was a victory for the progressive philosophy. Is he right?

CONGRESSMAN ERIC CANTOR: You know, I — obviously, Chris, I disagree with that. And I think if you look at some of the indicators in the polling post the election, this was not some kind of realignment of the electorate, not some kind of shift of the American people toward some style of European social big government type of philosophy.

I think instead what has — we have seen happen is a tremendous distrust on the part of the people in their government. We were, you know, associated with this government for the past eight years.

And you can look at some of the things that people are upset about, whether it was the latest in the financial crisis, whether it was the handling of the response to Hurricane Katrina, or whether it was the continued ratcheting up of federal spending in Washington.

All of these things, I think, led to the fact that we did not perform well in this election. We'll have to regroup. We'll have to come back to this notion that it really is not about left versus right. It's not about conservative versus liberal. It's about right versus wrong.

And we're going to have to take into consideration the fact that this country has grown more diverse, and — but there is still yet a common element among the American people. And that is they want to see a government that works for them.

And we still believe very strongly that it is our common-sense conservative principles of a limited government, of lower taxes, of reining in federal spending that will provide the type of solutions to the challenges that face American people in their everyday lives.

And I do believe that this will be what our road map will contain going forward.

WALLACE: But let me bring this — bring up something that you just said with Congressman Pence.

Congressman Cantor at the beginning said this wasn't a victory for big government and European social solutions. Now, obviously, the Obama campaign or the Obama camp now wouldn't call it that, but those were certainly the issues in this campaign — questions of taxes. The idea — the charge of socialism was brought up.

The American people didn't seem to buy it.

PENCE: Yeah. Chris, I do want to agree with Eric. I don't think this was a victory for — a progressive or liberal victory. I think this was a victory for Barack Obama.

And I want to begin this morning by offering my sincere congratulations to the president-elect and to his team on running an exceptional campaign.

WALLACE: But forgive me, Congressman, he stood for some things in that campaign.

PENCE: Well, he stood for some things, and you know, I read Rich Lowry's column this morning where he pointed out that exit polls showed that only 22 percent of Americans embrace what is described as a liberal world view. That's the same as it's been the last four and eight years.

I agree with Eric. I don't think this was a liberal realignment. I think this was an enormously effective campaign run by the president-elect and his team.

But also, I'm not immune to the fact that this was an extremely moving and historical moment in the life of this nation.

You know, I grew up in a time when my heroes were John F. Kennedy and the Reverend Dr. Martin Luther King Jr. And I have to tell you, to see an African American president-elect walk out on that stage and say to the world, "My story would only be possible here in America," was deeply inspiring to me.

WALLACE: Well...

PENCE: And so I really do believe this was not a realignment. This was an extraordinarily compelling figure. And the fact that John McCain still came away with, I think, 46 percent of the vote shows the resilience and durability of common-sense conservative ideals.

WALLACE: Well, for all the good feeling, Congressman Pence, you have been quoted as saying that you feel your job over the next two years is to, quote, "Expose, dismantle and defeat..."

PENCE: Right.

WALLACE: "... the liberal Democratic agenda." So much for cooperation.

PENCE: Well, let me say — look. You know, I'm a conservative, but I'm not in a bad mood about it, Chris. You know, the purpose of the opposition is to oppose, to oppose every time that we do.

And look, we're — you know, I prayed for our president-elect this morning. I think Americans all want to see their president successful. We're going to get through an inauguration. It's going to be a historical moment.

But as Eric and I both know, having dealt with the Democrats on Capitol Hill, and knowing the policies of the president-elect, we're going to have some pretty vigorous disagreements, and they're going to be along traditional fault lines.

And we're going to cheerfully provide that loyal opposition.

WALLACE: Congressman Cantor, let's look at some of the exit polls from Tuesday night. Back in 2004, the same percentage of voters, 37 percent, identified themselves as Republicans and Democrats. Tuesday, Democrats had a seven-point advantage.

And look at these voting blocks. Mr. Obama did 14 points better among Hispanics than John Kerry did, plus eight among people making more than $100,000 a year, plus 12 among young voters.

Congressman Cantor, when you look at those numbers, when you look at the fact that you have — are losing the West Coast, you're in the process of losing the Rocky Mountain West, and you now don't have a single House Republican member from New England, isn't the GOP in some trouble?

CANTOR: Well, listen, there's no question the numbers are startling. And if you do look at the turnout numbers and the responses of those interviewed, we have to demonstrate, number one, that we understand what people are going through. Our vision going forward has to be one of reform.

But look. There's no question, Barack Obama is an extraordinary communicator. The success of his campaign was largely based on a message that he was able to connect with a broad swath of the American people.

There's no question that the Republican Party has got to stop doing things the way they've always done them. We were doing things that we'd been doing for the last 10 years.

The incredible innovation and use of technology that the Obama campaign and the Democrats employed is stunning. We're going to have to change.

The Republican Party will have to begin to adapt those innovations and that technology to make sure that we can reach out to the increasing diverse population of this country.

But at the end of the day, it is about a message of change. And what we're going to be faced with when we come back to Congress in January is a president who probably will be facing extraordinary challenges at a historic level.

If you look at, obviously, the roiling global financial situation, if you look at the fact that much of this country distrusts its government, if you look at the fact that we're still fighting in two wars, I think that the Republicans in Congress will stand ready to work with this new president.

But if he then says, "I'm going to pivot away from my campaign promise to raise taxes and find a solution where we can help families and small businesses create jobs and find some type of security again," then we'll support him.

If, in turn — that he veers left and says, "No, the way to do this is to crank up the government spending machine and to raise taxes on families and small businesses," we're going to oppose him.

You know, and so there is going to be, I think, a willingness to try and get things done. But at the end of the day, I think you will see a Republican Party in Congress serving as a check and a balance against Mr. Obama's power and Speaker Pelosi's power.

WALLACE: But forgive me, Congressman Pence. An awful lot of what Congressman Cantor just said was what John McCain was saying, and the public rejected it. I mean, those were the issues on which this campaign was fought.

I don't think this was just all about the charm of Barack Obama. I think there were some issues involved here as well.

How do you come up with a new message that will resonate in the parts of the country — and I'm talking about New England, the far west, the Rocky Mountain West — where people are beginning to tune you out?

I had Karl Rove on on election night, and he said, "It's not enough to just go back and say, 'Well, we're the party of Ronald Reagan."' He says you've got to come up with new conservative solutions to the problems that people face today.

PENCE: Right. But you build those conservative solutions, Chris, on the same time-honored principles of limited government, a belief in free markets, a belief in the sanctity of life and the sanctity of marriage.

You look at those social issues, Chris — you know, there were three state referendums on marriage. All three of them carried — I think in Florida, California and Arizona.

You know, the vitality of the conservative movement around the country is very real. I don't think we should draw any broad conclusions, as Eric said, about a big realignment. You know, my...

WALLACE: So what do you do, as I say, to speak to people to say, "We can solve your problems..."

PENCE: Oh, I think that...

WALLACE: "... better than the Democrats?"

PENCE: Well, I think number one, I like your question because I think being in the minority in the House and Senate for two years, what we've learned is we've got to speak to the American people.

What we've learned is that a minority of conservatives in the House plus the American people equals a majority.

And last August, when House Republicans held the House floor for five weeks and demanded that Speaker Nancy Pelosi abandon her historic opposition to more domestic drilling, the American people mobilized, contacted their members of the House of Representatives, and the policy changed.

That's exactly the kind of approach you're going to see. It's going to be a cheerful opposition. We're going to carry those timeless principles of limited government, a strong defense, traditional values to the American people.

And we're going to invite the American people — when the opposition is appropriate, we're going to invite the American people to join us in stopping any slide to the left by the Obama administration or Pelosi Democrats.

WALLACE: And finally, Congressman Cantor — and we have less than a minute left — how long do you see Republicans in the wilderness? Is this something that takes years, or do you think you could actually take back the House or the Senate in 2010?

CANTOR: You know, I think it's pretty unbelievable that we sit here today, given this date — and four years ago the discussion was all about the Democrats unable to find their footing.

So I do think in this age of the 24/7 news cycle and the Internet world, we're going to have the ability to reach out to many supporters and many people across this nation and allow them to see very quickly the differences in terms of vision of where we want to take this country.

And I think our challenge going forward is to make sure that we're able to connect with the younger people in this country in explaining our vision and talking about the conservative principles that will be adapted to the everyday challenges that people face.

And I think that's our challenge, as you suggest, Chris, in the Northeast, in the upper Midwest. We will not be taking back a majority unless we are able to put in place a plan that does just that.

WALLACE: All right.

Congressman Cantor, Congressman Pence, we want to thank you both for talking with us. We'll be watching you both in action over the next two years, and we'll have you back often.

PENCE: Thank you, Chris.

WALLACE: Thank you.

CANTOR: Thanks.

WALLACE: Up next, our Sunday regulars read the first tea leaves from President-elect Obama and try to figure out what his administration will do. Back in a moment.