This is a rush transcript from "FOX News Sunday," November 18, 2007. This copy may not be in its final form and may be updated.
CHRIS WALLACE, HOST: For months, he's been the standout among the second tier.
(BEGIN VIDEO CLIP)
MIKE HUCKABEE, FORMER GOV. OF MASSACHUSETTS: We've had a Congress that spent money like John Edwards at a beauty shop.
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WALLACE: But suddenly Mike Huckabee is up with the frontrunners.
(BEGIN VIDEO CLIP)
HUCKABEE: You don't ever point your gun at a dead carcass. A lot of folks are pointing at me.
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WALLACE: He's tied for the lead in Iowa and scrambling the Republican race.
Today we continue our series "Choosing the President" with an exclusive interview. We'll put Mike Huckabee on the hot seat and find out who is this guy.
Well, a funny thing has happened in the run-up to the Iowa caucuses. Two new polls show longshot Mike Huckabee almost in a dead heat for the lead with frontrunner Mitt Romney.
Take a look. A New York Times poll this week finds Romney at 27 percent, Huckabee at 21 percent, and all the other Republicans trailing. And an American Research Group poll has it even closer, Romney at 26 percent, Huckabee at 24 percent.
As we continue our series "Choosing the President," we welcome the biggest story in presidential politics right now, former Arkansas Governor Mike Huckabee who joins us from his home state.
And, Governor, welcome back to "FOX News Sunday."
HUCKABEE: Thank you very much, Chris.
WALLACE: You have got about $1 million. Governor Romney's got about $10 million. At last count, you had 10 staffers in Iowa. He had about 60. How are you making a race of this?
HUCKABEE: Well, you know, the same way the little boy fed 5,000 with two fish and five biscuits. We've just got a lot of people praying that what little we have will turn into much, and it has. And it's been an amazing thing for us.
But I think what we're proving is that it's not about how many resources you have. It's about how well you use them, how well you manage them. We don't waste things. We're very frugal.
And we have an incredible, fervent volunteer group of people across this country blogging for us, working their hearts out, making sacrifices that, frankly, sometimes bring tears to my eyes when I hear about it.
WALLACE: Another big difference is that as of mid-October, Romney had run commercials 5,000 times in Iowa, and you had not run a single commercial there or anywhere else.
But as a big difference, you have now made your first T.V. commercial. You, in fact, even have a celebrity endorsement. And we are now going to have the world premiere of your first T.V. commercial of this presidential campaign. Let's watch.
(BEGIN VIDEO CLIP)
HUCKABEE: My plan is secure the border. Two words. Chuck Norris.
CHUCK NORRIS, ACTOR: Mike Huckabee is a lifelong hunter who'll protect our Second Amendment rights.
HUCKABEE: Chuck Norris doesn't endorse. He tells America how it's going to be. I'm Mike Huckabee and I approved this message. So did Chuck.
NORRIS: Chuck Norris-approved.
(END VIDEO CLIP)
WALLACE: Well, it's pretty clever, Governor. But what do you think, in a practical sense, it actually does for you in terms of convincing votes in Iowa?
HUCKABEE: Oh, it probably doesn't convince anybody. The spots we'll run next week will start doing that. But what it does do is exactly what it's doing this morning, getting a lot of attention, driving people to our website, giving them an opportunity to find out who is this guy that would come out with Chuck Norris in a commercial.
So what we want to do is to, first of all, show that running for president is serious business but that a person ought to have a little fun doing it. And so we're going to have some fun. We've had fun throughout this campaign. We plan to continue doing that.
But we also want to let people kind of find out who I am and what I'm about. This commercial, we think, will drive a lot of new folks to our website who will then do some serious research about the issues.
WALLACE: Well, let's talk, Governor, about the issues. Your big idea in this campaign is to put the IRS out of business and set up what you call and others have called a fair tax.
WALLACE: This would be a sales tax of 23 percent on almost every good and service you buy or anyone buys. But a bipartisan panel named by President Bush had this to say, and let's put it up on the screen.
HUCKABEE: All right.
WALLACE: They say to raise enough money, the rate would have to be 34 percent, not 23 percent, and they noted no state or country has ever levied a retail sales tax at a tax rate that even approaches the 34 percent required to replace the federal income tax system.
And again, Governor, that is from a panel, bipartisan panel, named by President Bush.
HUCKABEE: Well, the only problem is twofold. First, they didn't really study the fair tax. They simply studied a type of consumption tax, not the actual proposal that was designed by some of the leading economists in this country.
The fair tax was not just something I cooked up. Frankly, I wish I had. But it was designed by the leading economists from MIT, Boston University, Harvard, Stanford, people like Arthur Laffer, one of Reagan's key economic architects — had $20 million of research that went into the proposal.
So if this bipartisan commission had actually studied the fair tax, they might have had a different conclusion.
And the second thing — it is a rate of 23 percent. It's not 30 percent or 34 percent, as some of the critics complain. That's part of the problem, in that the way the fair tax works — by not having any tax on individual income, dividends, savings, capital gains, corporate or personal income, payroll taxes, you lose almost 22 percent of embedded tax in everything we buy.
And the other thing — when you go to the marketplace, you go with your entire paycheck, something Americans for the most part have never done in their lives.
Wouldn't that be a novel thing? You actually get everything you earn, and you decide how you spend it, rather than the government taking it before you ever get your hands on it.
WALLACE: But the Bush panel also said — and as you say, they weren't talking about your plan specifically, because this...
WALLACE: ... happened a couple of years ago, but they were talking about a fair tax which, as you point out, has been around a lot longer than Mike Huckabee has been proposing it.
They said that a fair tax would reduce taxes, the tax burden, on only two groups, those making less than $30,000 a year, because there's a rebate for people under the poverty line, and those making more than $200,000 a year.
So the rich and the poor do better, but the vast middle class ends up paying more taxes.
HUCKABEE: Well, again, they had a fatal flaw. They didn't understand that the "prebate" applies to everybody, including the middle class.
The second flaw was that they didn't fully comprehend that if you take the economy groups in thirds, the lowest end up getting about 12.8 percent benefit. Those in the middle actually end up with about an almost 7 percent benefit. Those at the top end up with a 4 percent to 5 percent benefit.
So everybody comes off better off, and here's one of the reasons why, Chris. With the fair tax, you end the underground economy — drug dealers, prostitutes, pimps, illegals. Everybody has to pay the tax at the retail level.
So right now those billions of dollars that people like you and me are having to make up for because other folks are working under the table — now everybody's paying into the system. That's one of the reasons that it really is a fair tax.
It's fair. It's flat. It's finite. You know exactly what you're going to pay. And it's family-friendly. It doesn't penalize people for being married, raising kids. In fact, it does the opposite. It encourages people in their families to take care of their families because there are benefits for each household.
WALLACE: Let's talk about your record as governor. The conservative Club for Growth says about you — and let's put it up on the screen — "Huckabee's substantial tax hikes far surpassed his modest tax cuts, with the average tax burden increasing by a whopping 47 percent over his tenure."
Governor, you raised taxes on gasoline. You raised them on cigarettes. You even raised them on nursing home patients.
HUCKABEE: Well, we didn't raise them on nursing home patients. That was a quality assurance fee that was supported by the industry. People can go to my website, MikeHuckabee.com, get the full details of that.
And they'll find out that what it really did was save the nursing homes from going out of business, at least about half of them. Where would those people have gone? And it increased the quality of care by increasing the staffing requirements.
We also built roads. That was a good thing. That put $1 billion into our economy. We had the worst road system in the country according to Truckers Magazine. Five years later, I was proud to be the governor of what was called the most improved road system in the country.
A lot of people wish they were working on their infrastructure, including their bridges, these days after we've seen them collapse. I didn't wait till something completely fell apart. We addressed it.
The people of our state voted 80 percent to pay for those bonds that covered that road program, so I think I did pretty well.
Now, here's what the Club for Growth won't tell you. And by the way, their tactics — got to be some of the most despicable in politics today. It's why I love to call them the Club for Greed, because they won't tell you who gave their money. They just like to take money from anonymous donors, fire shots at folks without any accountability.
I balanced the budget every single year of my 10.5 years as governor. I saw tax cuts almost 94 times in my state, including signing the first- ever broad-based tax cut in 160 years, and did it against the headwinds of a party that was in 90 percent control of the legislature at the time I became governor.
I think my record's an incredibly good one. And if you look at our spending, we did a lot of things to curb it, including merging some state agencies.
My first day in office, I appointed what's called a Murphy Commission to look at every agency of state government and make recommendations from a business panel of how we could make government more efficient.
WALLACE: Governor, you say that you balanced the budget, but your critics question how you chose to balance the budget.
They have put up on the Internet, as you know, a speech that you made to the Arkansas legislature back in May of 2003 in which you sure seem to be considering raising almost every kind of tax. Let's watch. Let's watch it, sir.
(BEGIN VIDEO CLIP)
HUCKABEE: ... suggested a surcharge on the income tax. That's acceptable. I'm fine with that. Others have suggested perhaps a sales tax. That's fine.
(END VIDEO CLIP)
WALLACE: And after that speech, the legislature did, in fact, raise taxes on tobacco products and imposed a 3 percent income tax surcharge.
HUCKABEE: They sure did. By the way, first of all, you know, if you look at that speech, that was about 110 pounds ago for me. I could argue that, you know, I was in some type of sugar rush and simply speaking out of my mind.
But the truth is what they did — they took a one-minute clip out of about a 20-minute speech. And if you listen to the entire context, what you find is that we were dealing at that point with a real crisis. We had come to an impasse in our previous regular session.
This was a special session. We were a few days away from having no budget and shutting state government down. We had already cut 11 percent out of the state budget which I led in doing, when there's only 9 percent margin from the 91 percent that is education, Medicaid and prisons in our state general revenue budget.
What we did with this session — I came in. A lot of the legislators said, "Well, this proposal is dead on arrival. This one won't work. And we'll be against it if the governor's for it." Keep in mind the context. I'm in a very Democrat-led state in the legislature. They were doing everything they can to see this thing not go anywhere.
So I went in and I said, "OK, you guys say some things aren't on the table, some things are. Let's look at all the options that have been discussed." What I said was, "We've got to steer this canoe through the low water, whatever it takes to do it. We've got to come up with a budget to save this state from going into complete shutdown, and that's unacceptable to all of us."
WALLACE: But, Governor, you know you're going to have financial problems as president here in Washington. Wouldn't, under that same reasoning, you have to consider raising taxes as president?
HUCKABEE: Well, what you do is you first deal with the spending issue, which I did in my state. And I don't think the federal government needs more money. I think it needs greater curbs on spending. That's our problem here.
The other issue in the state is that you don't have the option of even temporarily borrowing money and printing up some money like the federal government does, which is one of the reasons we're in trouble at the federal level.
Two things the federal government has done — it's borrowed against our grandchildren's future ridiculously. And the second thing — it's just pushed costs down to the states that should have been federal costs, and that was one of the things that we were dealing with as a state in 2003 — was federal cost-shifting.
So I think I managed this state quite well. If you look at how we reformed education, health care, transportation — we did extraordinary things in conservation and environmental protection. It's a good record — lowest unemployment rates. You know, if my economic record was so bad, how come at the end of it we had $1 billion in surplus, the lowest unemployment rates that had been sustained forever in history, and we also had been able to move half the people who had been on welfare into jobs?
It's a record that historians are going to be very kind with, even if the Club for Growth isn't.
WALLACE: All right, Governor. We have to step aside for a moment.
But up next, with a surge in the polls comes closer scrutiny of the governor's years in office. We'll ask him about those controversies when we come back.
WALLACE: And we're back now with Republican presidential contender Mike Huckabee.
Governor, you say you're the true social conservative in the Republican field, but as you know all too well, the National Right to Life Committee this week endorsed Fred Thompson, not you, raising doubts about your electability.
First of all, what do you think about that, their raising electability as an issue? And secondly, how do you compare your records on abortion and gay, same-sex marriages to Thompson and Romney and McCain?
HUCKABEE: Well, I've never switched my positions, for one thing. I have a record that doesn't just talk about what I said I was for. But we actually passed a human life amendment in Arkansas. We passed over 11 pieces of pro-life legislation that I signed and led. I led the March for Life every year.
I'll put my record up against anybody's on the sanctity of life. I was surprised by the endorsement for Thompson. But you know, my surprise was nothing compared to the surprise of the people out in America who have been faithful supporters of right to life.
Fred's never had a 100 percent record on right to life in his Senate career. The records reflect that. And he doesn't support the human life amendment which is most amazing because that's been a part of the Republican platform since 1980.
And as far as electability, my numbers are far better than his, especially in Iowa. So I think I'm pretty doggone electable. And in fact, I've been elected four times against the Clinton political machine in Arkansas, something no presidential candidate can talk about.
WALLACE: Now, Thompson and McCain both talk about leaving abortion and gay marriage to the states, the way, in the case of abortion, it was before Roe vs. Wade ever became the law of the land in the first place.
Why isn't that good enough, basically making this a federal issue and leaving it up to each state?
HUCKABEE: Well, it's the logic of the Civil War. If morality is the point here, and if it's right or wrong, not just a political question, then you can't have 50 different versions of what's right and what's wrong.
Again, that's what the whole Civil War was about. Can you have states saying slavery is OK, other states saying it's not?
If abortion is a moral issue — and for many of us it is, and I know for others it's not. So if you decide that it's just a political issue, then that's a perfectly acceptable, logical conclusion.
But for those of us for whom this is a moral question, you can't simply have 50 different versions of what's right.
WALLACE: Part of the downside of rising in the polls is that you come under a harsher spotlight, and there's been a lot of talk this week about ethical issues involving you back when you were governor of Arkansas.
Why did the state ethics commission investigate you in 14 different cases and, in fact, reprimand you in five of those instances?
HUCKABEE: Well, the only time they ever tried to fine me was overturned by a court. Understand the nature of Arkansas politics. It is not bean bag. This is serious business down here.
And when you're a Republican in a very Democrat state, you've got to look at where those complaints came from. Most of them were filed by members of the Democrat Party or the party itself.
Some of them were filed by an editor of a local tabloid down here, who filed a bunch of them. And many of them were thrown out. I was sued repeatedly. It's part of the process.
You know, the one thing that proves — I'm prepared for the rigors of a presidential campaign in that I've been through this stuff. I don't have a glass jaw. It's rough and tumble stuff down here.
But if you take a look at all the accusations, all of them turned out to be pure nonsense, and that's why I'm still here. If I'd done half the stuff that these guys have thrown at me through the years, my goodness, I'd be in more trouble than running for president.
WALLACE: Well, let's talk about at least a couple of the instances. In 2006, as you were preparing to leave the governor's mansion, you and your wife of more than 30 years set up a wedding registry, a wedding gift registry, at local department stores so people could help furnish your new home.
HUCKABEE: No, that's not at all what happened, Chris.
WALLACE: Governor, let me just ask.
HUCKABEE: OK. All right.
WALLACE: You don't see anything wrong with that?
HUCKABEE: No, and let me tell you what happened. Some of my wife's friends, some from church, some from high school, wanted to do a housewarming party for her. I had nothing to do with it.
And when the reporters asked me, I said, "Look, in my state, if a guy knows anything about his wife's friends giving a housewarming party, you know, he's going to get laughed out of town."
It was some of my wife's friends from church and high school. They did a housewarming party. It was not a public event. It was a private event by invitation only, sent invitations to about 30 people, with her friends.
The newspaper got wind of it and made a big deal of it and tried to act like there was something sinister about people giving my wife a housewarming party.
Now, in the South and, I have a feeling, in most parts of the country, that's something friends do for friends, and it had nothing to do with the public until the newspaper made something out of it.
WALLACE: Governor, is it just a coincidence that wedding presents were one of the specific items that fall outside the $100 gift ban?
HUCKABEE: No, had nothing — it had to do with the fact that one of the stores — by the way, the kind of big exclusive stores were Target — that's the kind of high-dollar stuff we were dealing with, with her friends.
WALLACE: And Dillard's.
HUCKABEE: It happened — well, and Dillard's. It happened to be that they didn't have a category at that time for housewarming. You only had weddings and you had baby showers. At our age, we darn sure couldn't get on record as being preparing for a baby shower.
WALLACE: Well, don't sell yourself short. You lost 100 pounds, Governor. But let me...
HUCKABEE: Not 100 years, though.
WALLACE: But there are — you know, to be fair, a number of these incidents over the years. Let's just list them.
WALLACE: You tried to claim $70,000 of furniture donated to the governor's mansion as your own.
HUCKABEE: No. Hold on.
WALLACE: Let me just list them...
HUCKABEE: OK. All right.
WALLACE: ... and then I'll give you a chance to answer, sir.
WALLACE: You repeatedly accepted gifts in excess of $100.
In 2002, you actually sued the state ethics commission to halt an investigation of allegedly illegal gifts.
Governor, isn't there something — and this is a dirty word. Isn't there something Clinton-esque about all this?
HUCKABEE: No, there's not. There's something Arkansas-esque about it, and that is that, again, if you look at the politics of this state, the people who are not happy that I was governor — remember, I was only the fourth Republican elected in 150 years.
I was sort of a lone wolf out here. They couldn't attack the fact that I was getting things done like building roads and reforming health care and education. So it got to be the politics of personal destruction. The attacks were relentless.
As I told you before, Chris, I got sued regularly. I got these ethics charges filed against me. And we had to fight them. And so we fought them in court. We thought them with the ethics commission.
And at the end of my term — you know, I still have my critics and I always will, but I can put my head on the pillow at night. This stuff about like taking all these gifts — for example, I personally reported stuff that was given to my staff because I wanted to be fully in disclosure.
Probably my biggest mistake was I disclosed too much, and when people gave things like flowers to the office or pastries on Monday morning, I put that down on my personal form because we didn't have any other way to report it.
And even though it may look like I ate all those pastries in the early days of my governorship, I assure you that I most certainly did not.
WALLACE: You know, the basic point that I think is being raised here, and you could say it's some old enemies in Arkansas trying to get back at you, is the issue as to whether there's another Mike Huckabee other than the nice, affable guy we're seeing on the campaign trail, that there's another Mike Huckabee from back in Arkansas.
I just want to close this part of the interview out. Quin Hillyer — and he's not the guy you were talking about who had a vendetta against you. He used to be an editorial writer for the pro- Republican Arkansas Democrat-Gazette.
He wrote about you in the American Spectator, which is certainly not a liberal journal, and he said that the national media doesn't know the real Mike Huckabee. He wrote, "If they only did a little homework, they would discover a guy with a thin skin, a nasty vindictive streak and a long history of imbroglios about questionable ethics." Governor, how do you plead?
HUCKABEE: Well, you know, it would have been nice if Mr. Hillyer and the American Spectator had done what fundamentally is a journalistic 101, and that's called us and asked us for a response.
And when he was asked why he didn't, which is always fundamental — if you attack somebody, you give them a chance to respond, as you graciously have — he said, "Oh, I didn't need to call him. I already knew all there was to know about him."
Interestingly that his colleagues at the Democrat-Gazette who write the editorials just this very day — look online — wrote a glowing editorial about my character.
So you know, it's one of those things where it's in the eye of the beholder. Do I have a mean streak? Do I occasionally get upset? Of course I do. I'm far from perfect. And you're going to find some moments where I either lost my temper or I said something that probably I regret.
But am I some evil human being that has horns coming out of the back of my head? I wouldn't have survived this long in this business and certainly not in this state had that been the case.
So you know, I'm going to let people take a look at the record. My heavens, we've had another governor from Arkansas who had a lot of things that were investigated from head to toe.
I'm more than willing, if people want to take a look at all these charges and accusations, if they want to dig through them — there's lots to dig through and lots of explanations and answers.
And I'm going to be comfortable that at the end, people will say, "You know, this guy's a survivor, and he's tough enough to take it. He's tough enough to be president."
WALLACE: Let's finish up, if we can, in the moments remaining, sir, with the campaign. There are plenty of candidates, as you know, who have done well or even won in Iowa and then basically their campaigns have stalled out after that — Bob Dole in 1988, Pat Robertson in 1988.
Even if you were to win in Iowa in less than two months, you're going to be broke. You're going to have almost no field organization anywhere else in the country. So what do you do then? How do you quickly nationalize a campaign on January 4th?
HUCKABEE: Well, I'm not sure we're going to be broke. We've started raising money at the kind of rate that I wish we had done early in the season of the political campaign. And again, we're using it wisely.
We've had to upgrade our Web server three times in a week to handle the traffic as people have gone and made contributions.
We think we're on target not only to do well in Iowa but to go on with that momentum, do better than expected in New Hampshire, go to South Carolina. Then it's a whole new ball game.
By that time, you may have some of these folks who have been riding the waves of the frontrunners — they may be bowing out by then. So nobody knows what's going to happen in this election.
I'll be the first to tell you I'm not sure what's going to happen. But you know, for 11 months, people have been writing my political obituary, and we're talking today about the Mike Huckabee surge. And we'd been talking about the Mike Huckabee dirge a few months ago.
So I'd say that — you know, just keep watching. This thing is not over yet.
WALLACE: Finally, you like to tell audiences on the campaign trail, "I'm a conservative, but I'm not mean about it." And as I suspect you know by now, some conservatives have taken offense to that. Is there a mean streak in the conservative movement?
HUCKABEE: I'm not going to go off into saying it, but you know, I'll just tell you this. I'm not a conservative that wants to be a wholly owned subsidiary of anybody.
I'm an independent conservative. And what I mean by that — when I think we're right, I'm with us all the way, and I am a conservative. And I think my record reflects that.
But you know, I also believe that the purpose of government is to function. It's not to just stand at one side, throw stones at the other guys and act like they're wrong all the time.
I say some things that just are anathema to the orthodox crowd that says they're always wrong. Well, I say Republicans aren't right all the time. Democrats aren't wrong all the time — now, maybe most of the time, but not all the time.
And America is looking for leadership that's not so much about beating up the other guys. They really want this country to move forward and upward. It's what I call vertical politics, going up, not down, rather than just saying, "Let's go left, let's go right."
WALLACE: Governor Huckabee, we're going to have to leave it there. We want to thank you so much for joining us today. And we'll see you down the road in Iowa and New Hampshire. Thank you, sir.
HUCKABEE: Thank you, Chris.
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