This is a rush transcript of "Special Report With Bret Baier" from July 22, 2009. This copy may not be in its final form and may be updated.
REP. NANCY PELOSI, (D-CA) HOUSE SPEAKER: I think that we are moving closer, we are making progress, and I have no question that we have the votes on the floor of the House to pass this legislation.
REP. JOHN BOEHNER, (R-OH) MINORITY LEADER: It's time for the president to scrap the plan that they have been working on in the House. It's time to bring both parties together to have real health care reform that will reduce the cost of the system, will reduce the cost of health insurance for Americans and provide better access.
(END VIDEO CLIP)
BAIER: Some sounds from House leaders just hours before the president holds a news conference, talking primarily about health care. The White House has released some excerpts from his opening statement which is expected to be about seven to 10 minutes.
In there, he will say "If we do not control these health," meaning health care costs, "we will not be able to control our deficit.
I have also pledged that health insurance reform will not add to our deficit over the neck decade, and I mean it." He has said that before.
A new development tonight. We are getting word that the Senate Majority Whip, Dick Durbin from Illinois, has told The Hill newspaper that he thinks it is very unlikely that a health reform bill will be voted on by the Senate before the August recess, which is August 7. He says it just doesn't seem possible now.
So let's bring in our panel, Steve Hayes, senior writer for the Weekly Standard, Mara Liasson, national political correspondent of National Public Radio, and syndicated columnist Charles Krauthammer.
Mara, these developments continue to unfold throughout the week, and it does not look good as far as the urgency. But what about the setup for this news conference tonight?
MARA LIASSON, NATIONAL POLITICAL CORRESPONDENT, NATIONAL PUBLIC RADIO: The setup for the news conference tonight, I mean, I think the president would have liked it if there had been a little more movement, something he could have announced.
And there has been some positive movement in the last day or two. Nancy Pelosi has said we will adjust these tax hikes that are so upsetting to our more conservative Democrats. That's been a bar for them to get the votes.
We're also going to include this IMAC, Medicare commission that will control costs. That's something else the blue dogs wanted.
The president has said something interesting to Katie Couric at CBS where he basically suggested that he did not want to have publicly-financed abortions in the bill.
So there is movement around the edges. The bazaar is open. He is meeting with members every single day.
I think what Dick Durbin said today was just an expression of reality. There is no way the Senate can pass a bill by August. I think the House could.
BAIER: Which makes it tougher for the House.
LIASSON: Yes. Here is what the blue dogs need, the conservative Democrats in the House — in order to vote for a bill that's too liberal for them, and a certain number of them, their votes are going to be needed, they want to make sure they are not BTU-ed.
And what they mean by that is back in the Clinton years they were forced to vote on a BTU tax. And guess what? They lost control of Congress for that and other reasons. They don't want to be hanging out there for some big tax hike that, in the end, the Senate's not going to support and it's not going to be in the final bill.
They want the Senate Finance Committee at a minimum to come out with a more conservative package that they can point to and say that's the kind of thing I want.
BAIER: Charles?
CHARLES KRAUTHAMMER, SYNDICATED COLUMNIST: And as we heard, it's not going to happen before the recess. I'm not sure a blue dog would risk his future on a committee report that has not been adopted by the whole Senate. He could still end up being left way out there hanging.
But the president's strategy tonight is not a defense. It will be in part a defense of his proposals in the House and Senate. It is going to be an attack.
He is losing altitude on this issue. He knows it. What does he do? He goes to his strength. And his strength is on the campaign trail. He is going to attack, attack, attack tonight. He is going to go after Republicans.
The real issue, of course, is Democrats who are resisting, and the numbers don't add up. But he will pretend in the press conference, and as we saw in some of his — in some of the remarks he is going to make in the beginning, that it is all about Republican obstructionism.
And he will actually attack our colleague Bill Kristol, to which I want to ask, who do you have to pay in the White House to have the president of the United States attack you on national television? I want to know how you get that done.
And he is also going to attack Senator DeMint, a Republican, who said it would break the presidency if he is defeated on this. He will make it a partisan issue, and when he does that, and a rhetorical issue, he can gain.
BAIER: Steve?
STEVE HAYES, SENIOR WRITER, "THE WEEKLY STANDARD": I talked to Bill Kristol, my boss at the Weekly Standard, and he said he wants to be clear that it is not about him, that it's about the debate.
(LAUGHTER)
I think Charles is right. And it is a baffling strategy to me. I just don't understand it.
What I think it will be, actually, interestingly, is a real test for our colleagues in the media and the mainstream media in particular.
It's patently false that Republicans are stopping this, that they are the real obstructionists here. The real problem, as Charles elaborated on, is the Democrats.
Steny Hoyer yesterday said it's not just the blue dog Democrats, it's all the Democrats. It's the progressives, it's the blue dogs, it's everyone.
He has to find a way to convince blue dog Democrats and others to join with him. He's intervening personally to make this happen. That is what he needs to do to make sure that he has an accomplishment that he can tout. Attacking Republicans doesn't advance the ball.
BAIER: What about another part of the story that developed today? The director of the Congressional Budget Office, Doug Elmendorf, was invited to meet at the White House, and he went to the Oval Office this week.
And that has prompted some lawmakers to have remarks about that meeting.
(BEGIN VIDEO CLIP)
SEN. MITCH MCCONNELL, (R-KY) MINORITY LEADER: I noted that the CBO director was sort of called down to the White House yesterday. It strikes me as somewhat akin to the owner of the team asking the umpires to come up to the owner's box.
If the CBO is to have credibility, they are the umpire, they're not players in this game.
SEN. MAX BACHUS, (D-MT) SENATE FINANCE COMMITTEE CHAIRMAN: Anyone who calls it like it is Doug Elmendorf. I haven't met anybody as straight, if you will, as Doug Elmendorf. You cannot push him one way or another.
(END VIDEO CLIP)
BAIER: Senator Baucus was talking about Elmendorf, but a lot of people are questioning the motivations of the invite, not about the DBO director accepting the invite. What about that, Mara?
LIASSON: The president has talked about this meeting with Doug Elmendorf and other economists, and he wanted to meet with him to find out other ways you could do cost savings. He has been searching for every single idea that's out there.
And of course —
BAIER: But it comes after a negative report from the CBO.
LIASSON: There is no doubt that the optics of this look bad, although, as you heard, nobody, not even Republicans today are questioning Elmendorf's independence and the fact that he does call them the way he sees them.
But Elmendorf has said pretty straight that he thinks one of the best ways to control health care costs is something that the president has absolutely ruled out, which is to tax these gold-plated plans.
There are other ways to do that, and the president said he is open to some of them, which is to somehow to put a fee or penalty on the insurance companies who issue these policies. But that's one of the things they were talking about.
BAIER: What about the optics, as Mara mentioned, of this?
KRAUTHAMMER: The optics are terrible. It is like the chief of police invited to have a chat with Don Corleone about law enforcement issues in the neighborhood. It is not exactly what you want.
However, I point out that Republicans also attacked CBO when Republicans were in office over the scoring, over estimates, because it would underestimate the savings from tax reductions.
But you never had a president asking a CBO official into his office as a way of appearing to apply any pressure.
BAIER: Last word, Steve.
HAYES: Well, it's part of the game. Republicans attack the CBO, Democrats attack the CBO. I think what makes this interesting is that Doug Elmendorf has impeccable liberal credential. He came from the Brookings Institution, a liberal think tank, and he was appointed by Democrats. So I think if the president is trying to pressure him, it was a foolish move, because it certainly wouldn't look good if he now went back and rescored it and changed his views.
BAIER: Secretary of State Hillary Clinton has some words of warning for Iran. The panel will talk about what she really meant today, next.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
HILLARY CLINTON, U.S. SECRETARY OF STATE: If the United States extends a defense umbrella over the region, if we do even more to support the military capacity of those in the Gulf, it's unlikely that Iran will be any stronger or safer, because they won't be able to intimidate and dominate as they apparently believe they can once they have a nuclear weapon.
(END VIDEO CLIP)
BAIER: Well, that raised some eyebrows around the world and here in Washington when Secretary Clinton in Thailand said if Tehran gets a nuclear weapon, the U.S. would extend this defense umbrella over the Persian Gulf states. She later in Phuket sought to clarify her comments, stressing that the Obama administration still views a nuclear-armed Iran as, quote, "unacceptable." We are back with the panel. Charles, was this a misstatement or a signal that the administration is sending out we could be OK with a nuclear Iran?
KRAUTHAMMER: On April 16 of last year in a presidential debate, George Stephanopoulos asked Obama and Clinton what they would do if Iran attacked Israel with a nuclear weapon.
She answered very strongly, would retaliate. We would retaliate with nukes, and we would extend an umbrella and protection over Israel, and she added, over other states in the region.
Obama answered weakly and actually cluelessly.
She repeated that idea a few times in the campaign as a way to show how tough she was as opposed to him. I think what happened today is this show in Thailand is that she was repeating that theme inadvertently.
It is one thing to do it and to say it as a candidate as a kind of a hypothetical, but once you say it as secretary of state, you are implying, as everybody thought she was implying, that America already accepts the reality of a nuclear Iran and is thinking about containment and deterrence, as we did in the Soviet example in the cold war.
I think it was — if it was Obama policy, it's a hell of a way to actually announce it or imply it. I think it was a gaffe that she later tried to walk back.
BAIER: Israeli leaders piped up right away, Mara.
LIASSON: Right, and said that was not helpful at all.
Michael Kinsley once famously said a gaffe in Washington is when somebody tells the truth. There is no doubt that it would be irresponsible if the Obama administration wasn't planning for a nuclear-armed Iran. They're very, very close. So far, everything we have done, all the offers of engagement haven't changed anything. Their centrifuges are spinning as we speak.
So it's smart to think about what would happen if they do have a weapon, while at the same time, your public policy is that they can never get one, it's unacceptable, and we will do everything to stop them.
But I think that's what this reflected. They would have to extend some kind of defense umbrella or nuclear umbrella over the region, because otherwise they will have a Middle East arms race.
BAIER: Steve, she said later that if Iran tries to get a nuclear weapon or gets one, it faces the prospect of sparking an arms race in the region. Again, that was in the walk back session. What about this?
HAYES: That's echoing the words of the president himself. He was asked about this directly in an interview with the Associated Press about three weeks ago, and said have you now accepted that an Iranian nuclear weapon is inevitable.
And he said, no, I haven't accepted this, but did not take the opportunity, I thought notably, to say an Iranian nuclear weapon is unacceptable, which is something he had said early in the presidential campaign.
I think we have seen gradually his language soften on an Iranian nuke. And I think Mara is right. I'm worried that this reflects internal Obama administration discussions that she accidentally said outside. I don't think she said this on purpose.
BAIER: It's no mistake, Charles, that Israeli leaders with quoted in wire stories right after this happened. There is concern inside Israel about the Obama administration and their tact, right?
KRAUTHAMMER: If you're an Israeli and you have the history of a Jewish people in your mind, and you're looking at an adversary who says he wants to wipe you out and he's acquiring a nuke, and your principal ally in the world is telling you don't hit them, don't attack them, we're going to deal with this, the international community will, apparently concede that the Iranians are going to go nuclear, it would cause alarm. And I'm sure it did.
LIASSON: Vice president Biden not very long ago was asked about this, and he pointedly said whatever Israel does is up to them. He didn't take the opportunity to throw cold water on it. That suggested to some people that he was giving the green light to Israel.
(CROSSTALK)
HAYES: Two months earlier, Vice President Biden had called a potential Israeli attack on Iranian nuclear facilities "ill-advised." So I think he was walking back his own misstatement.
BAIER: A lot of walking back.
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