The following is a rush transcript of the January 24, 2010, edition of "Fox News Sunday With Chris Wallace." This copy may not be in its final form and may be updated.
CHRIS WALLACE, ANCHOR: With their big win in Massachusetts, Senate Republicans are reassessing their chances in the November elections.
Joining us now, one of the GOP Senate leaders, John Cornyn of Texas, who is also head of the Republican Senate Campaign Committee.
And, Senator, welcome back to "Fox News Sunday."
SEN. JOHN CORNYN, R-TEXAS: Thanks, Chris.
WALLACE: How will you vote on giving Federal Reserve Chairman Ben Bernanke a second term?
CORNYN: Well, I think Ben Bernanke is a brilliant and an honorable man, but one who has presided over what is a crisis of confidence of the American people due to a lack of transparency and accountability with regard to the bailouts and other activities by the Federal Reserve.
So regretfully, I will vote "no" on his confirmation. I think they need a fresh start. And I think that would be the best thing for this administration and for the country.
WALLACE: Warren Buffett, perhaps the country's most respected investor, says if Bernanke is voted down, he would like to know the day before so he can sell some of the stocks. And here's what he said on Fox Business Network to Republican critics now like yourself.
(BEGIN VIDEO CLIP)
WARREN BUFFETT: I would say they ought to get down on their knees every night and thank the Lord that Bernanke was there through this. I mean, he took some unprecedented actions. He took them quickly. He kept us from going right into the precipice. There's no question in my mind about that.
(END VIDEO CLIP)
WALLACE: Senator, the Dow Jones lost more than 400 points this week just on the possibility that Bernanke would not be reconfirmed.
A number of analysts say voting Bernanke down would send shockwaves to markets around the world. Are Republicans willing to take responsibility for that?
CORNYN: Well, I noticed some prominent Democrats have said they will not vote to confirm Mr. Bernanke.
And frankly, I think, you know, part of the reason the stock market went down is because the president announced his bank tax, which caused 200 points of that drop.
So there is a lot of uncertainty as to what the political situation is going to be, what the — here is — now that Washington has become the financial capital of the world instead of New York, a lot of uncertainty about what that's — what's going to happen here.
But I think the Federal Reserve would benefit from a — from a fresh start. I'm not saying that Mr. Bernanke hadn't done a good job, once the crisis was created, in trying to deal with the financial crisis. I think he's probably mitigated a lot of the harm that could have happened.
But I think he should have seen it coming. The bubble in housing and easy money which led to a huge increase in housing prices over a short period of time and then collapsed I think has contributed a lot to the problems that he then was required to help try to clean up.
WALLACE: You just heard Robert Gibbs, White House press secretary, give his analysis of the vote in Massachusetts on Tuesday and preview the president's state of the union address.
Do you think, based on what you just heard, that the White House has gotten the message Massachusetts voters were sending?
CORNYN: The Massachusetts voters weren't talking about tactics. They weren't talking about communication strategy. They were talking about policies that they disagreed with, whether it was our national security policy dealing with the terrorists, treating it as a ordinary criminal event, trying masterminds of 9/11 in civilian court in Manhattan.
They were saying they didn't want this nationalized health care bill. They didn't want to see their premiums go up. They didn't want to see taxes go up. They didn't want to see us taking money from Medicare to create yet another entitlement program.
And they were scared about the endless spending and debt that they've seen coming out of Washington this last year. If the White House and the Democrats didn't get that message, then I think they really missed the point of what happened in Massachusetts.
WALLACE: On the other hand, you've just heard Robert Gibbs. He cites a poll from the Washington Post that indicates that they want Scott Brown to come in and work with Democrats, that they're not — they want some health care bill, just not the health care bill that's being passed.
You know, there are some positives there. So what about his argument that, in fact, there isn't this complete rejection of the Obama agenda?
CORNYN: I think the message that Scott Brown so effectively gave in Massachusetts — and by the way, he's entitled to the lion's share of the credit. He was a fantastic candidate with exactly the right message at exactly the right time.
But the message was not, "Let's tweak this thing around the edges or around the margins." It's about starting over. And if that's what the White House wants to do, I know there are a lot of Republicans that would like to work with them to try to do things that will actually bring down the costs of health care and will make it more affordable.
WALLACE: You know, let me ask you about health care. If Democrats — and Robert Gibbs left it wide open. If Democrats try to pass comprehensive health care reform, perhaps through the parliamentary maneuver, budget maneuver called reconciliation, where they would only need 51 votes in the Senate, what do you think the political repercussions will be?
CORNYN: Well, if they try to jam it through as they have so far, with — strictly along partisan lines, then I think November 2010 will be a very good month for us.
I think we will gain a lot more seats, because frankly, I think it will show how tone deaf they were to the message that the voters of Massachusetts and across the country were trying to send.
WALLACE: Are Republicans really willing to compromise with Democrats on a scaled-back bill, to accept — I know there are certain things you want, like malpractice reform and allowing insurance to be sold across state lines.
Are you willing to accept some Democratic ideas, or do you just want unconditional surrender?
CORNYN: No, we want a seat at the table. That's what I think the voters in Massachusetts were saying. They want a seat at the table. They don't want any of these behind-closed-doors sweetheart deals that made a mockery of the democratic process, the legislative process, here in Washington.
If the White House and Democrats will agree to an open, transparent process where our ideas are considered and perhaps included in some legislation, I think we can start over with a step- by-step approach that will result in real reform, not just reform in name only.
WALLACE: And what do you think of what seems to be the president's new populist line fighting for the little guy, fighting for the middle class?
CORNYN: Well, the problem is the uncertainty of this administration's policies are killing jobs and making it harder for the average American worker. I think that's part of the message we saw out of Massachusetts. Higher taxes, more regulation, you know, the idea of creating new entitlement programs while you're spending borrowed money and racking up debt and not dealing with the financial — long-term financial problems that this country has in terms of unfunded federal liabilities — those are things that literally, I think, prompted the Massachusetts voters to action.
This is the fear and the anger that you hear or that I hear in my state and across the country that apparently the White House has not yet heard.
WALLACE: As we said, you're in charge of getting more Republicans elected to the Senate. The current line-up — there are going to be 36 races in November. Eighteen of those seats are now held by Republicans, 18 are now held by Democrats.
How has Scott Brown's victory in Massachusetts changed the political map?
CORNYN: Well, it's energized everybody on our side to the opportunities that might be there in November 2010.
We've already got a large number of excellent candidates. We have a number of primary races that will have to be played out across the country. But it's made a big difference in terms of people's interest in running, and I expect we'll even hear more people who decide to run. And it's also helped us with the — with the fundraising that's part of the — part of the process.
WALLACE: How would you rate President Obama's political strength in the country right now?
CORNYN: Well, I think most polls say he's about even with — between those who approve and those who disapprove, and maybe slightly below even.
I think he's got an opportunity to do a mid-course correction as a result of the message sent out of Massachusetts and around the country. I think if he did that, then he would have a good chance to have a successful first term as president.
If he doesn't, if they persist along the same lines, stay the course, thinking it's a matter of tactics as opposed to the policy that are so unpopular, like health care, then I think he's not going to have a successful first term.
WALLACE: What do you make of the decision to bring back campaign manager David Plouffe to provide political advice to the president and, basically, it seems, to be in charge of the 2010 mid-term election campaign?
CORNYN: Well, I think — what I gather from that is they seem to think that it was — they caught got napping in Massachusetts and didn't respond soon enough.
But what they have failed to acknowledge so far is the unpopularity of the policies, whether it's national security policy, treating people like the Christmas Day bomber as a ordinary criminal, as opposed to the terrorist that he is, and trying him before military tribunals and gathering actionable intelligence.
I think the unpopularity of the health care bill — Scott Brown unequivocally said, "I will be the 41st vote to stop this bill and start over." Now, that took a lot of courage, especially in Massachusetts in the seat previously held by Teddy Kennedy, but he did it. And that's what helped catapult him to victory.
WALLACE: A couple of final questions. On the other hand, according to a recent poll — and let's put it up on the screen — 34 percent — only 34 percent of voters now have a favorable opinion of congressional Republicans. Fifty-six percent do not.
And Tea Party Movement says national Republicans like John Cornyn are part of the problem, not part of the solution. How do you address both of those issues?
CORNYN: Well, we've got a lot of work to do. And I think that's a matter of listening to what the message was in Massachusetts and the message that I hear in Texas when I — when I'm home and around the country.
And that is people want their country back. They don't want the elites here in Washington deciding what's best for them and then trying to jam it down their throat whether they like it or not. That's what's happened with health care, and we saw...
WALLACE: But they seem to be saying there's a Republican elite that's trying to jam things down their throat, too.
CORNYN: Well, I think we — we're in the minority now, and literally we have no power to stop 60 senators...
WALLACE: Well, I'm talking about the Tea Party Movement, which...
CORNYN: Yeah.
WALLACE: ... was upset with your organization for endorsing people like in Florida and saying let the voters decide.
CORNYN: Well, we try to listen to what they've told us, and that is we're going to have competitive primaries in Florida and elsewhere, and let the primary voters choose. I think that is — and then nominate the strongest candidate to run in November.
I think — I would also mention, Chris, that Republicans lead Democrats by eight points on the generic ballot, according to the Rasmussen poll. So there is room for hope, but I think we have a lot of work left to do.
WALLACE: And finally — and we've only got about 30 seconds left — what's the practical effect of the Supreme Court ruling this week saying that corporations can now openly support and spend money, openly supporting or opposing candidates? Do you expect a rush of corporate cash into the campaign?
CORNYN: No, I don't. I think it's been overstated, the impact. Frankly, there's been an explosion of money into federal races for public office since — well, in the last 10 years, since campaign finance reform.
It hadn't done anything to stop the flow of money in. What it's done is make it less transparent and less accountable. President Obama spent more money in his campaign in 2008 than Senator Kerry and President Bush did in 2004 combined.
So what we need is transparency. We need contemporaneous reporting on the Internet. I think that's the kind of accountability that we need.
WALLACE: Senator Cornyn, thank you. Thanks for coming in today. And it's always a pleasure to see you, sir.
CORNYN: Thanks, Chris.
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