This is a RUSH transcript from "The O'Reilly Factor," December 21, 2010. This copy may not be in its final form and may be updated.
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BILL O'REILLY, HOST: In the "Back of the Book" segment tonight: There is a lively debate in this country over exactly how smart President Obama is. As you may know, he was president of the Harvard Law Review, and many consider him to be a brilliant man. But others say he's not so smart. If he were, the country wouldn't be so polarized.
Joining us now from Washington, Fox News political analyst Charles Krauthammer. All right, Charles, take it away on this.
CHARLES KRAUTHAMMER, FOX NEWS POLITICAL ANALYST: Well, let's start with a gold standard in intelligence among Democrats: Bill Clinton, very smart guy, character problems but very smart. Nobody will dispute that. He takes a shellacking in his midterm elections. It takes him a year to recover. Half a year into that time, he's actually asked at a press conference, "Are you still relevant?" And, in fact, he wasn't for all that time.
Now let's look at Barack Obama. He takes a worse shellacking in his midterm election. Six weeks later, he is a central player. He's back off the mat. He's a guy who swindled the Republicans into giving him a trillion-dollar stimulus, something which if he would have asked for, he would have been laughed out of town, in return for a two-year temporary extension of tax rates for two percent of the population.
O'REILLY: OK. Let me just stop you there.
KRAUTHAMMER: He does that at the time of his lowest ebb.
O'REILLY: OK. Let me just stop you there so you can explain the stimulus for people who haven't heard this before. So because the unemployment benefits were extended, all right, out, and because money was taken away from the Treasury in the form of the higher tax rates didn't come to fruition, you say that that money is going to be in the economy and will help him turn the economy around?
KRAUTHAMMER: Every president covets an infusion of money into the economy during his re-election.
O'REILLY: Then why would he in the beginning say...
KRAUTHAMMER: Whether it's from the monetary side, the Fed, or from the fiscal side, from the government.
O'REILLY: OK, then why wouldn't he -- why wouldn't he say in the beginning, "I want the tax -- the Bush tax rate to remain the same," but he didn't? You know, it looked -- the perception was that the Republicans kicked his butt. You say no, that he snookered them. Your word. OK. But the perception among the folks is the Republicans hammered him because he was on the wrong side of the issue.
KRAUTHAMMER: It turned out that he got what any president would want to have for re-election. He got the middle-class cuts, which was about $250 billion, added onto that about 70 for the upper class. He's willing to swallow that in order to get billions, tens, hundreds of billions of dollars of extra spending and other cuts and extension of the cuts he had instituted in his stimulus one. Now that stimulus one was so reviled that it wasn't even mentioned by Democrats in the election season, and if he had asked for a second stimulus of this size...
O'REILLY: Would have been voted down.
KRAUTHAMMER: ...nobody would have even looked at him. But in return for a temporary extension of tax cuts, he got it.
O'REILLY: You're saying he's smart because he's doing this in a stealth way, and the tax compromise that he signed will help the economy, make it get better, and that he is much stronger now, in a position to be re-elected than he was in November.
KRAUTHAMMER: He was a man with no cards. If the Republicans had given him nothing, they would have gotten, in the first week or two of January, an extension of the Bush cuts. That was already -- that was already in the bag.
But, look, I called him the comeback kid in a column four days ago. What's happened since? He passed "Don't Ask, Don't Tell," something that liberals have been trying to get for 17 years, and tomorrow he's going to get a huge success, victory on the START treaty. Now, I don't think it's worth the paper it's written on. But if you're a liberal or a Democrat or a worshiper at the altar of arms control -- there are a lot of Americans who are -- it's a huge victory. And this for a guy six weeks ago got absolutely slaughtered in an election with historic losses in the House. You've got to be smart to be able to pull that off.
O'REILLY: All right, Charles. Thanks very much. Very interesting.
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