The following is a rush transcript of the July 25, 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 the midterm campaign intensifying, we've asked two big thinkers to discuss it, from Vermont, Howard Dean, former governor and chair of the Democratic Party, and here in studio, former House speaker Newt Gingrich.
And, gentlemen, welcome back to "Fox News Sunday."
NEWT GINGRICH, FORMER SPEAKER OF THE HOUSE: Good to be with you.
WALLACE: Let's start with the case of Shirley Sherrod, the Department of Agriculture official who was forced to resign because the Obama administration mistakenly thought that she had made racial comments.
Speaker Gingrich, after she quit Monday, you said this --
(BEGIN VIDEO CLIP)
GINGRICH: I often disagree with this administration, but firing her after that kind of viciously racist attitude, was exactly the right thing to do. And the fact that we have to be genuinely color blind -- you know, you can't be a black racist any more than you can be a white racist.
(END VIDEO CLIP)
WALLACE: Speaker, was that irresponsible, calling her viciously racist based on an Internet clip that had been taken out of context?
GINGRICH: Well, remember, I was -- I was operating in the context of the secretary of agriculture having summarily fired her, and therefore there was no reason to disbelieve the clip. And what you -- what you see was one more example of the Obama administration's continuing incompetence.
Apparently, she didn't even get the courtesy of a chance to talk to the secretary of agriculture, who I -- who I suspect fired her under pressure from the White House, and she says she was told that they were firing her under pressure from the White House.
So my comments were in the context of a clip which had been validated by the secretary of agriculture who had fired her. Clearly, when you look at the complete clip and when you look at the background information and when you listen to the white farmers say she had actually been very helpful, I think it's -- a fair case can be made that this administration acted with destructive irresponsibility in the way that they fired her.
WALLACE: But in fairness, this is not the first time you've done it. Last year when the nomination of Sonia Sotomayor to the Supreme Court came up and those comments about the wise Latina woman comments were released, you tweeted this, "White man racist nominee would be forced to withdraw. Latina woman racist should also withdrew."
You later apologized. But again, why so quick...
GINGRICH: Well, what I said later...
WALLACE: Let me just finish.
WALLACE: Why so quick to call people racists?
GINGRICH: What I said about Sotomayor I think still stands, which was the statements she made were clearly racist. Now, I don't know -- have any idea in her heart whether she's a racist, but you go back and look at her exact quotes and they were quotes which if you put in white male instead of Latina you would absolutely say that was the statement of a racist.
When you look at what happened the other night, I was reacting directly to somebody who had been fired by the White House and the secretary of agriculture based on a clip which had been shown. And my point was one I think that you'd agree with, which is there's no room in America for a black racist, a Latino racist, or a white racist, or an Asian racist, or a Native American racist.
Now, we're either color blind or we're not color blind.
WALLACE: Let me bring in Governor Dean, because the fact is...
GOV. HOWARD DEAN, FORMER DNC CHAIRMAN: Yeah, Chris, let's just...
WALLACE: Go ahead, sir.
DEAN: Let's just be blunt about this. I don't think Newt Gingrich is a racist, and you're certainly not a racist, but I think Fox News did something that was absolutely racist.
They took a -- they had an obligation to find out what was really in the clip. They had -- they had been pushing a theme of black racism with this phony Black Panther crap and this business and Sotomayor and all this other stuff. You -- I think you've got to be very -- I think the -- look the Tea Party called out their racist fringe, and I think the Republican Party's got to stop appealing to its racist fringe. And Fox News is what did that.
You put that on.
WALLACE: Wait, wait, wait, wait --
DEAN: Yes, I think the Obama people...
WALLACE: Governor? Governor? I know facts are inconvenient...
DEAN: Yes. Yep.
WALLACE: I know facts are inconvenient things, but let's try to deal with the facts. The fact is that the Obama administration fired or forced Shirley Sherrod to quit before her name had ever been mentioned on Fox News Channel. Did you know that, sir?
DEAN: I did -- what I do know is that video came out...
WALLACE: Did you -- did you know that, that her name -- did you know that her -- that she was fired before her name was ever mentioned on the Fox News Channel?
DEAN: What about the video? Where did that play? What about the incomplete video from a...
WALLACE: The video had never played...
DEAN: ... from a right-wing...
WALLACE: The video had never played on the Fox News Channel before the White House fired her. It was on Andrew Breitbart, biggovernment.com. We're not responsible for them. I agree with you it was out of context.
DEAN: And it was about to go -- and it was...
WALLACE: But it wasn't on Fox News, so maybe you shouldn't be using racist (inaudible) either.
DEAN: And it -- and it -- and it was about to go -- and it was about to go on Glenn Beck, which is what the administration was afraid of.
Look, I think that -- I think Newt's right. I don't think she should have been fired summarily. And I think we ought to stop being afraid of Glenn Beck and the -- and the -- and the racist fringe of the Republican Party.
But Fox News was not blameless during this. You played it up. And I not -- I don't know if ever there was a clip of the white farmer saying, "Wait a minute. This woman helped us save a farm." Did that ever appear on Fox News?
WALLACE: Actually, I don't know, because I wasn't covering that part of the story. But we certainly -- we certainly reported that part of the story. Now, whether he was willing to appear -- I haven't seen the white -- the white farmer. I've seen his wife. I haven't seen him anywhere, but that may be a mistake on my part.
But let's get back to what you just said. The Obama White House fired her -- the administration fired her -- for fear, not the reality, the fear that she was going to appear on Glenn Beck. Is that what Barack Obama...
WALLACE: ... campaigned for when said he was going to change the 24/7 media cycle? Is that the profile in courage?
DEAN: I think that's wrong. I think -- as you know, I've made a career standing up to that kind of stuff, and I think that was a mistake on the part of the Obama administration. But I'm not going to let the right- wing press off the hook on this.
WALLACE: Well, again -- I mean, again, the fact -- what are the facts here, sir? Because the facts are...
DEAN: The facts are that you...
WALLACE: The facts are she was not on -- she had -- her name had never been mentioned on the Fox News Channel until -- explain to me, why do you think the Obama administration...
DEAN: And then -- and then...
WALLACE: Why do you think the...
DEAN: ... and then -- and then...
WALLACE: Let me finish.
DEAN: ... and then, Chris...
WALLACE: Let me ask my question and then you can answer. Why do you think the Obama White House, administration, fired her before her name ever appeared on Fox News?
DEAN: Did you play -- did Fox News play the clip that turned out to be inaccurate?
WALLACE: After she was fired.
DEAN: Right. I don't think it matters whether it was before or after. The question is you played it. You didn't do your job -- or not you personally, of course, but the people who chose to play the clip.
And there's been this ongoing theme about black racism in America. I agree with Newt that racism has no place in America, whether it's black, white, Latino, or anything else.
But I think continuing to cater to this theme of minority racism and stressing comments like this, some of which are taken out of context, does not help the country knit itself together.
GINGRICH: If I could just a second, I would -- I just want to point out, the NAACP, operating off the same clip and off the same action by the secretary of agriculture, also condemned her initially...
DEAN: I agree, and that was wrong as well.
GINGRICH: ... and this -- and the NAACP has condemned the New Black Panthers as a racist organization. So the -- and in fact...
DEAN: I agree.
GINGRICH: ... I have on occasion sided with the NAACP's characterizations. All I'm suggesting, and I think -- I think it's very worrisome to people. If the Obama administration is this afraid of Glenn Beck, how do they deal with the Iranians? I mean, if a news show forces this level of irresponsibility...
DEAN: Well, there may be some similarities, Newt. There may be some similarities.
GINGRICH: I'm just saying, if they're that frightened by an American TV show, how do they deal with the real world?
WALLACE: Governor Dean, let me ask you another question, because I think this goes to a bigger issue. You spoke recently to a progressive conference at which you said this, "You elected Barack Obama. You elected a Democratic Congress. You elected a Democratic Senate. And now it's time for them to behave like Democrats if they want to get reelected. They have forgotten where they came from."
Question: Have the president and congressional Democrats been too timid?
DEAN: Well, obviously, the health care thing is my largest concern, although that's sort of over and done with and we've got to make what we have work. But that was a disappointment for me.
Financial reforms was good. I mean, there was definitely some good stuff in there. There were some things that I thought got taken out at the last minute that were of some concern.
But I think that the major problem here is that people really wanted change. You've got, for example, lobbyists who then went -- I mean, people who work for a major insurance company, health insurance companies, that ended up as chiefs of staff, or people who had a key role in writing the health insurance bill. I mean, that kind of stuff is not supposed to be going on with the -- with the new election that we -- the new regime, the new administration, and so forth and so on.
So what we -- all we really want, I think, from the so-called Democratic wing of the Democratic Party is really to stand up for what we believe in. There's a congressman in Virginia who's going to have a tough time getting reelected. His name's Tom Perriello -- very conservative district, replaced a very conservative Republican. I think he's going to get reelected by just a hair. Why? Because he practices something conviction -- something called conviction politics.
He's down -- explained to everybody in his district why he voted for the health care bill and why he thinks it's going to be good. He's not running away from anything. He's not afraid of Glenn Beck. He's not afraid of the right. And that's what we've got to have some of in this party.
WALLACE: OK. Let's talk about voters' number one concern. I think that's clearly jobs and the economy.
Speaker Gingrich, why hasn't the economy bounced back nearly as much as the Obama White House said it would when they pushed through the $862 billion stimulus package? And should the Bush tax cuts for the wealthy be allowed to expire, especially at a time when the economy is still so fragile?
GINGRICH: Well, let me say, first of all, that the Obama administration apparently announced on Friday they expect unemployment for all of next year to be at 9 percent. Now, Americans should be very concerned about this. This is the first time since the Great Depression that we have had this level of unemployment continuing for more than a year.
And I think it's because you have job-killing policies. And this is where Governor Dean and I deeply disagree. I think the stimulus package was fundamentally wrong because trickle-down bureaucracy doesn't work.
I think the tax increases that are buried inside the health bill are going to further depress the economy. I think the tax increases and regulations in the financial reform bill will further depress the economy.
I think that the proposal that they raise taxes next year -- the safest thing for America would be to have a provision passed this fall that said no tax increase of any kind in 2011. I mean, the fact is everywhere I go -- and I've been in 10 states in the last 14 days -- business people say to me over and over again, "I will create no new jobs in this environment because the uncertainty is too frightening."
WALLACE: So you're saying extend all the Bush tax cuts.
GINGRICH: I'd extend -- I would simply say no tax increase next year. Keep current law as it is, and extend no tax -- have no tax increase next year, and look seriously at something like Congressman Jordan's five tax cuts, because we are stuck at 9.5 or 9 percent unemployment and that means we're in danger of dropping to 12 as much as we are rising to 8.
WALLACE: Governor Dean, why hasn't the recovery been stronger? And what about the Bush tax cuts for the wealthy?
DEAN: I think the recovery hasn't been stronger because the hole that was dug for President Obama by the Bush administration was far worse than anybody could imagine, first of all.
Second of all, I don't think Wall Street is doing what it's supposed to be doing, even after the shameful performance of the last two years. They're are not allocating capital.
When you -- when you -- and this is still going on today -- are making your money by pushing paper around, when you should be making your money by investing venture capital in various job-creating things, that makes it much harder to recover.
Now, I think the -- I do disagree with Newt for two reasons. First of all, I think the stimulus has definitely done some good and the CBO thinks that's true also.
But here's the fundamental reason I disagree with Newt on the tax issue. The fact of the matter is I think Newt and I would agree that the deficit is a huge problem and we cannot continue with deficits in the trillion-dollar range. It's just not doable.
So if you're going to fix the deficit, everybody's going to have to pay something. You can't -- we can't as Democrats go out and talk about entitlements if people who are making $250,000 a year are getting tax cuts. That makes no sense at all. We're all in this together. Everybody has to put something on the table.
DEAN: I don't believe for a moment -- I don't believe for a moment that going back to where Bill Clinton's tax rates were for people who make over $250,000 is year a going to hurt the economy at all.
WALLACE: Gentlemen, we're running out of time, and I've got a couple of minutes left, and I want to get into two more issues -- first of all, Charlie Rangel.
Governor Dean, should Congressman Rangel cut a deal with the House Ethics Committee to spare House Democrats the spectacle of a public trial a couple of months before the midterm elections?
DEAN: You know, I don't get into that. That's -- you know, Charlie has run afoul of the Ethics Committee. He's owed a fair process. If he's -- if he wants to cut a deal, that's his business. But you know, this process has to work. And I'm proud to say the process is working.
He did some things that look like they ought to get him thrown out of Congress. And if it turns out that he did them, he's going to get thrown out of Congress. And I think that's the way the process is supposed to work.
WALLACE: Let me pick up on exactly that point, because there's talk, Speaker Gingrich, that maybe they still may work out a deal that would be short of his expulsion from Congress.
GINGRICH: I think -- look, Congressman Rangel has every right as an American citizen to defend himself. If he believes he's genuinely innocent, he ought to fight. If in fact, he believes and his attorneys believe he's guilty, it is to his interest and the Democratic Party's interest to cut a deal.
And then the question would be whether or not the deal would be acceptable to the Congress. I think once these kind of things become public it gets harder and harder and it fits patterns that go back to a number of other members, Kanjorski and others.
WALLACE: Finally, we have about a minute left, Speaker Gingrich. You said the other day you have, quote, "never been this serious" about running for president in 2012 and you'll make a decision shortly after the midterms, February or March of next year.
Having gone through this with you in 2008 -- and I say this respectfully -- why shouldn't we question whether you're playing the candidate card so that you can get more attention for your views?
GINGRICH: Listen, I think you can assume that up until February or March, that if I don't run you'll be able to say, "See? I told you." If I do run, you'll go, "Wow. This time it was real." I think that's a decision we'll make in February or March, and I'm actually not very much concerned about it.
WALLACE: But are you, in fact...
DEAN: Let me put in a good...
WALLACE: Well, let me just ask, are you playing the cards so you can get more attention?
GINGRICH: No. No, I'm seriously -- we -- Calista and I are seriously looking at, and our family is seriously looking at, what would it take. And I've talked to Howard about it. This is a very hard family decision because it's such a deep commitment and it is so absorbing.
DEAN: Let me put in a -- let me put in a good word for Newt Gingrich here.
WALLACE: Uh-oh. That's the kiss of -- that's the kiss of death.
DEAN: No, I'm serious. The big -- the biggest difference between this Republican congressman -- and I don't agree with very much that Newt Gingrich wants to do. But the biggest difference is Newt has a ton of ideas to move the country forward. He did when he was speaker.
There are no ideas in the Republican Party right now in the Congress. They're the party of no. They desperately need some intellectual leadership. And whatever you think of Newt Gingrich, he can supply intellectual leadership. So I hope he does run.
WALLACE: You know, I think there's a compliment in there somewhere, Speaker Gingrich.
GINGRICH: There is, but I'm not sure I could survive it in the primaries. Here's my opponent's clip in the primaries.
WALLACE: Speaker Gingrich, Governor Dean, thank you both so much for coming in. Please come back. Always a pleasure.