Transcript: 'The Journal Editorial Report,' January 12, 2008

This is a rush transcript from "The Journal Editorial Report," January 12, 2008.

PAUL GIGOT, HOST: This week on the "Journal Editorial Report," it's a fight for survival on the campaign trail as the candidates gear up for a wild January ride.

Is Tuesday's Michigan campaign do or die for Mitt Romney?

And what does John McCain need to do to sustain his New Hampshire mojo?

Plus, Barack Obama promised to inject a little punch in his politics of hope. But is he any match for a re-energized team Clinton?

Our panel weighs in after these headlines.

(NEWSBREAK)

GIGOT: Welcome to the "Journal Editorial Report." I am Paul Gigot.

The rest of January will be a fight for survival for some presidential candidates following John McCain and Hillary Clinton wins in New Hampshire Tuesday. The remaining White House contenders now turn their attention to key nomination battles in Michigan, Nevada South Carolina and Florida, all of which are a prelude to the February 5th Super Tuesday vote in more than 20 states.

Here with a look at the issue and demographics at work in these up coming races is FOX's own Michael Barone, senior editor of U.S. News & World Report and author of "The Almanac of American Politics."

Michael, welcome.

MICHAEL BARONE, U.S. NEWS & WORLD REPORT & AUTHOR: Good to be with you, Paul.

GIGOT: You said the breakdown in vote between Obama and Clinton in New Hampshire was eerily similar to the breakdown in the vote between Gore and Bill Bradley in 2000. What does it tell you where the votes are coming from this time around?

BARONE: If you look at Hillary Clinton's consistency, like Al Gore 8 year as in New Hampshire it tends to be older, it tends to be more downscale, less well educated. It tends to be more ethnic. She carried the Catholic voters by a wide margin. This is the historically democratic group in New England where politics used to divided, Catholic, Democrats to Protestant, Republicans. It's almost precisely the same coalition that prevailed for Al Gore by four points in New Hampshire in 2000, by two points in Hillary Clinton. You can't take from her victory any assurance that sort of downscale, less well educated, older coalition is necessarily going to prevail.

GIGOT: But if it does prevail, it seems to give Hillary Clinton an advantage. What you are describing for Obama's electorate is very similar to the Democratic electorate that voted for Paul Tsongas, say, it's similar to Bradley and even Gary Hart, all of whom lost the nominations against their opponents.

BARONE: They did lose their nominations. If you go back look at some of the races it was not foreordained. Walter Mondale out campaigned Gary Hart and out spun him in the 1984 cycle. That could easily have gone the other way. Remember, Al Gore beat Bill Bradley in New Hampshire by four points. The reason Bradley withdrew was there were five weeks from New Hampshire to the next contest. Five weeks is an eternity in this cycle. You have Michigan voting seven days after New Hampshire and we have got the Nevada caucuses and South Carolina Republicans only four days after that.

GIGOT: You have been following poles for a long time. I have never seen them so wrong as they were in New Hampshire. Why do you think they were so off in the Democratic race?

BARONE: Number one, there seems to have been a significant late switch by woman voters. There was a much bigger discrepancy between the public opinion polls the telephone polls taken before the election and between the actual exit polls and the vote on Election Day.

Secondly, we could be seeing something of what some people call the Tom Bradley effect, which we used to see in the 1990s, where people said to pollsters they were voting for black candidates, for Tom Bradley for governor of California in 1982, Doug Wilder for governor of Virginia in 89, David Dinkins for mayor of New York in 89.

In fact, fewer people voted for their candidates than told pollsters. The thinking was, well you had to tell people — there was a feeling you ought to be voting for the black candidate, but when it came down to voting, they weren't doing so. That is possibly a factor in New Hampshire. That's among Democrats and a liberal part of the political spectrum.

GIGOT: It will be fascinating to watch in South Carolina.

Michael, let's switch to the Republicans. John McCain won in Michigan. The next primary in 2000, 48 to 40, something like that, against George W. Bush but he did it with a lot of Democratic votes. Can McCain put together that same coalition? Where do you see a victory coalition and McCain's votes coming from in that state?

BARONE: John McCain can put together a winning coalition. It probably has to be different. Twenty percent of the Michigan Republican primary voters in '00 were self identified Democrats. Forty percent were self identified.

They were voting against John Engler the then governor of Michigan, a very successful Republican governor who had beaten up the Democrats all along, was supporting George Bush and was angling for a big job in the Bush administration which he didn't get. Those were anti-Engler votes.

Twenty percent of John McCain's vote margin came from the two black majority districts centered in Detroit. They cast something like 70,000 votes in that primary. There aren't 70,000 Republicans in it. There probably aren't 7,000 Republicans in those two districts.

McCain can't counts on getting that kind of support any more. John Engler is long gone George W. Bush is not his foil. He has to make it with other groups. He did well with university town people.

GIGOT: Ann Arbor and East Lansing in Michigan. Are there enough cultural conservative voters in Michael, like in Iowa, to propel Mike Huckabee to a victory, you think?

BARONE: There's a lot of cultural conservatives. There's a strong right-to-life movement in Michigan. One of the big conservative religious groups is Dutch ethnicity in and around Grand Rapids and Holland, Michigan. Kent and Ottawa Counties is the biggest concentration of Dutch-Americans in the United States. That's a conservative religious tradition.

It's different than the southern evangelical Christian religion, different in its demeanor, in its tone, in its theology and cultural ramifications.

While Mike Huckabee carried Sue County, Iowa, which is Dutch, he didn't get as big a margin as Gary Bowers did. And he's combined it in 2000. Not clear if he makes the cultural leap from Arkansas to western Michigan.

GIGOT: All right, Michael. Thanks so much for that insight. We appreciate it. Thanks.

BARONE: Thank you.

GIGOT: Still ahead, Barack Obama says he is ready to fight as the Democratic race heads to Nevada. Does he mean it? Our panel places their bets after the break.

(COMMERCIAL BREAK)

GIGOT: Barack Obama is promising to inject some punch into his politics of hope after a bruising New Hampshire defeat, outlining a new strategy against team Clinton. Obama said this week, quote, "We have to make sure we take it to them just like they take it to us. I come from Chicago politics. We are accustomed to rough and tumble," end quote.

Obama won the support of the 60,000 member Culinary Worker's Union in Nevada this week, a major coup that could boost his chances against Clinton in the Democratic Party's next major contest.

Joining the panel this week, "Wall Street Journal" columnist and deputy editor Dan Henninger and Editorial Board member Dorothy Rabinowitz, opinionjournal.com columnist John Fund, and in Washington, editorial board member, Steve Moore.

John, Barack Obama is a love not a fighter, at least that's been his campaign seat. Is he willing to go after Hillary Clinton and, if he does, what does I have to say to win the sale to Democrats?

JOHN FUND, COLUMNIST, OPINIONJOURNAL.COM: I think Barack Obama wanted to win this race playing nice. He's an old community organizer from Chicago. He does know how to play rough and he will.

GIGOT: Daily rough? The Daily — that kinds of rough, John?

FUND: We will see. He, I think, is ultimately going to have to take the argument to the Clintons on the following grounds. Hillary Clinton is not electable as a Democrat in the fall. I am.

GIGOT: I think, Dan, he was caught by surprise in New Hampshire. He thought he was going to win. Everybody in the press thought so too. Bill and Hillary Clinton really attacked them. For all the talk about the tears being the difference, Hillary Clinton's tears, I think Bill Clinton's line, it was all a fairy tale, made a difference.

DAN HENNINGER, COLUMNIST AND EDITORIAL PAGE EDITOR: Yeah.

GIGOT: When a former president of the United States tells his fellow party members that this other candidate is a fairy tale, it makes an impact.

FUND: Bill Clinton has 83 percent positive rating among New Hampshire Democrats.

HENNINGER: Bill Clinton is a Democratic saint in that party. It's hard to argue with a saint.

GIGOT: Somehow that word doesn't come to my mind.

HENNINGER: Believe me, not mine either. I am going to say something unusual. Bill is Hillary's spouse. The spouses have been engaged in this campaign. I think Barack should sic Michelle Obama on Bill Clinton the same way Elizabeth Edwards did it. We will see if Bill Clinton can go upside the head of Michelle Obama. That's one fight I would love to see.

GIGOT: Dorothy, you said on this show a couple weeks ago Obama's campaign was going to disintegrate. That was before the Iowa result. Were you wrong or premature?

DOROTHY RABINOWITZ, EDITORIAL BOARD MEMBER: I was neither. The fact is Obama has been officially transformed into a movement. You know what happens to movements instead of candidates? They go away. It's actually a foretaste of how the campaign is going to go. People are beginning to say, what is he saying? This is happening more and more and more.

GIGOT: It isn't enough substance.

RABINOWITZ: There's something else about him. It's the way people talk about why they are supporting him that gives you a hint. And they say America is going to feel better about itself the day he takes the oath of office.

We are in trouble if the reason for electing a president of the United States is a feel-good constituency. America needs to feel better about itself? You can see why all of Hollywood and 19 and 20-year-olds are drooling after him. It is this fantasy of feeling good.

HENNINGER: I don't think you can discount the force of idealism. JFK propelled it. In the Democratic Party, idealism, whether it's real or not, counts for a lot. There are huge segments of that party, especially young, who wants to vote for something idealistic. Boy, does he represent that.

FUND: The Clintons represent nostalgia, not the future.

GIGOT: Steve, let me ask you a question. I want to ask you about this class distinction between the Democrats, downscaled lower-income Democrats voting for Clinton and the Hanovers and college towns and the Durhams in New Hampshire going overwhelmingly for Clinton. What does that portend for the next races?

STEVE MOORE, EDITORIAL BOARD MEMBER: It's fascinating to see that — remember Bill Clinton was America's first black president. You are starting to see Hillary doing well with black voters.

I want to go back to a point John Fund made. Liberals and staunch Democrats want to win so badly this November. I have friends who will douse themselves in gasoline and light a match if they don't win after 2000 in 2004.

What's going on here is exactly this reexamination of the candidates. They see they are flaws with both of these candidates. With respect to Obama, exactly what Dorothy said, maybe he's too inexperienced and not ready for prime time.

On the other hand, Hillary, you don't see how she gets over 46 or 47 percent. That's the struggle that's going on with Democratic voters right now. With one can win in November? They don't know the answer.

GIGOT: Steve, we are going to be watching. Thanks.

Up next, Mitt Romney heads home. Will his native Michigan deliver a much needed win Tuesday? And can his struggling campaign sustain another loss? Our panel weighs in after the break.

(COMMERCIAL BREAK)

GIGOT: Well, John McCain's Granite State victory ensures a wild ride for Republicans this month with key races ahead in Michigan, South Carolina and Florida. First next, Tuesday's Michigan primary, where Detroit-born Mitt Romney is hoping a home state advantage will give him a much needed win.

Steve, Michigan politics are fascinating. John McCain won there in 2000. Can Mitt Romney upset him this time around?

MOORE: I think he can and I think he has to if he is going to keep his candidacy alive. I do in the think he can lose the first three states. After all, don't forget, Paul, he has spent some $8 million, maybe more. John probably knows the exact number. If you spend that amount of money you can't win it's a knockout blow for him.

GIGOT: What's his strategy to take out McCain? What does he need to say to persuade Republican voters?

MOORE: He needs to remind Republican voters of the things they didn't like about John McCain this summer, the fact that he is unreliable to many on taxes, the fact that he is such a maverick in the Senate that he often times gets under the skin of conservatives. He has to prove he is the real conservative that can win.

GIGOT: He was making a very different case. He was saying McCain is the insider, four-term Senator, not an outsider like Romney, who can come in and make a change Washington. What do you think of that case?

RABINOWITZ: You can't say he makes a different case because he makes a different case every time he speaks. None of this does him good. He has said both these things. He has reminded incessantly the entire public before him that McCain has done this and that. It is of no avail. This is the same man who said I got the silver. It doesn't matter.

GIGOT: Is the insider strategy against McCain going to work, John?

FUND: I don't think so. John McCain has been knocking over chairs in Washington for 30 years.

MOORE: They hate him in the Senate.

FUND: They say there are 99 Senators and one Senator who will leak to the media and that's John McCain.

John McCain has enormous credibility on things like earmarks, pork barrel spending. Those are the issues that riled Republican voters a lot. A lot of reasons Republicans are angry at their party is they felt they retreated from principles on spending. John McCain brings them back to that.

Mitt Romney makes the same case but he doesn't have the credibility because he doesn't have a track record.

GIGOT: Isn't McCain vulnerable on some of these issues that Steve raises? He won bigger among Independents in New Hampshire as he did in 2000, but a much narrower victory this time among Republicans. They are all going to be Republicans.

HENNINGER: I think Steve put his finger on the only thing John McCain is vulnerable on that is his unpredictability, his maverick reputation. Romney running against him is as an insider I think is a waste of time. He knocks that one out of the park. John McCain is unpredictable.

If I were Mitt Romney I would say, what will John McCain's Supreme Court nominees look like? Will he nominate another Tony Kennedy? You know what? He could.

GIGOT: John, one of the things that happened this week that was interesting is Fred Thompson rose up and took on Mike Huckabee at the debate on Thursday night. What's his strategy there? He is way down in the polls. It will be hard for him to win but why should he go after Huckabee aggressively as a liberal on liberal foreign policy.

FUND: Fred Thompson represents — at least he claims to — the entire Reagan coalition, fiscal conservatives, social conservatives, foreign policy conservatives. He went after Huckabee because Huckabee and campaign manager Ed Rollins said the Reagan coalition is pass,, it's gone. We have to dive off and get rid of some parts of the Reagan coalition. I think that angered Fred Thompson. I think it angers a lot of conservative Republicans and that's why he took the case to Huckabee.

RABINOWITZ: That's a high minded view of it.

(LAUGHTER)

I think what happened is some angel come to him in the night and said it's now or never Fred, you go and blast this guy in your territory. When you listen to that, it was a wonderful display. But you had a sense of premeditation about it.

GIGOT: Steve is — Rudy Giuliani came out with a big tax cut plan this week, which I think you are pretty fond of and there are a lot of good things in it. Is that focus on economic issues pivoting in a way from his main theme, which has been on national security? Do you think that can keep him in the game to Florida?

MOORE: I think it can. Everybody wants to be the come-back kid. Maybe it's Rudy Giuliani's turn to do that. This speaks of what we were talking about, about the Reagan coalition.

What Rudy Giuliani is trying to do with this man is out Reagan Reagan on tax cuts. He has proposed a $6 trillion 10-year tax cut. It's bigger than what Ronald Reagan proposed in 1981.

GIGOT: John, is Romney going to win? Is he going to upset McCain in Michigan, do you think?

FUND: I don't know. But I will say the fact that there are no Democratic primary elections worth worry about, the Democrats are staying away. That means the Democrats and Independents who voted for McCain in 2000 could easily vote in the Republican primary because there's nothing in their contest to worry about.

GIGOT: That would tend to lean for McCain.

FUND: That would give McCain an advantage.

GIGOT: OK, thanks, John.

We have to take one more break. When we come back, our "Hits and Misses" of the week.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

MITT ROMNEY, (R), PRESIDENTIAL CANDIDATE: There have been three races so far. I've gotten two silvers and one gold. Thank...

BARACK OBAMA, (D), PRESIDENTIAL CANDIDATE: Together, we will begin the next great chapter in the American story with three words that will ring from coast to coast, from sea to shining sea, yes, we can. Thank you, New Hampshire.

GIGOT: What you've just seen is the new bred of concession speech. And it brings us to our first "Hits and Misses" of the week — Dan?

HENNINGER: In the old model concession speech, the candidate would go out, congratulate his opponent, then go have dinner and move on. Not any more.

I am watching Barack Obama the other night. He says something nice about Hillary. Then suddenly he's giving this tremendous barnburner of a speech. I said he is giving his victory speech. It sounded like his first inaugural speech. Yes we can. Yes we can.

Mitt Romney did the same thing. Congratulated McCain and gave the same speech he had been giving two-days before.

Obviously, this is about pre-media. I think in a way it's nice. It's like being back in kindergarten where no one ever has to lose.

GIGOT: All right, Dan, thanks.

Next, an ironic twist to the Indiana voter I.D. case heard this week by the Supreme Court — John?

FUND: Paul, the critics of the Indiana law, which requires voters to show photo I.D. to vote, say it discriminates against voters, especially elderly voters. Here's the problem. They have used, as the poster child, someone who would be prevented from voting because they don't have a photo I.D., a woman who it turns out is registered in two states at the same time. That's illegal.

She, of course, says I don't know how that happened. She had a Florida driver's license, which wouldn't be acceptable if you were voting in Indiana.

The bottom line is the people who oppose this photo I.D. law, not only had a bad day in the Supreme Court, they had egg all over their face.

GIGOT: All right, John, thanks.

Finally, a miss to maybe candidate, New York City Mayor Mike Bloomberg — Dorothy?

RABINOWITZ: It's hard to come away from all of the glorious stuff to the little non-campaign of the mayor, the also the little mayor. The fact is the dark side to this endless flirtation of Mayor Bloomberg and the seduction line not running.

Think if you are a 17-year-old, you are listening to two years of the mayor saying I am not running, I am not running. Then to hear do words not matter? They do.

It's the pretense of this politician and others like him that they don't. The mayor is always looking for somebody health, the health of the citizenry. Let him think about the psychic health. Let me also promise, should the mayor undertake this mad run, there will be a state he wins, the only state, it is the state of the upper east side of New York, between 55th street and 96th.

GIGOT: All right, Dorothy. Not your favorite sector of the electorate, I know.

That's it for this week's edition of the "Journal Editorial Report." Send your e-mails to jer@FOXnews.com and visit us on the web at www.fox.news.com/journal .

Thanks to my panel and all of you for watching.

I'm Paul Gigot. I hope to see you here next week.

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