OTR Interviews

Lessons Pres. Obama Can Learn from the Averted Government Shutdown

This is a rush transcript from "On the Record," April 8, 2011. This copy may not be in its final form and may be updated.

GRETA VAN SUSTEREN, FOX NEWS HOST: We are following breaking news. A deal has been reached to avoid a government shutdown. We were very close to a shutdown tonight. It reminded many people of 1995. The shutdown lasted five days under President Clinton's watch.

Our next guest was involved in the whole thing. Former adviser of President Clinton's, Doug Schoen, joins us.

Doug, as you watched tonight, as we are winding down the midnight averted, what are your thoughts?

DOUG SCHOEN, FORMER CLINTON ADVISER: My thoughts are that Present Obama dodged a bullet, because what Karl Rove and Carl Cameron said is exactly right. The Republicans ate the Democrats' lunch. Harry Reid and President Obama are going to try to make the best they can of what was frankly a bad night.

VAN SUSTEREN: Going back to the -- to when the government shutdown under President Clinton, how tough was it on President Clinton?

SCHOEN: In the beginning, we had leverage, Greta, because we had been pushing for a balanced budget, unlike President Obama. So public opinion was on our side.

In this case, public opinion was divided. There was stronger support for spending cuts along the lines that the Republicans want. So the onus was really on the Democrats to compromise. Frankly, President Obama has more at risk than President Clinton had.

VAN SUSTEREN: Looking back, it's always easier to come up with how you should have done it. If President Obama had a do over on this, do you think he would have done it differently? Obviously I can see 20/20 hindsight gives much greater wisdom.

SCHOEN: Well, I think it's not only 20/20 hindsight. He has to look forward to the issue of the debt ceiling and the larger issue of the 2012 budget and reducing the deficit.

I think he's got to be more proactive, Greta. He's got to be more aggressive and recognize that both for political reasons and, more importantly, substantive reasons, he has to do more to reduce the deficit,

which means taking on entitlements, taking on defense, and really embracing something like the Bowles-Simpson plan as a means of countering what Representative Paul Ryan came out with this week.

VAN SUSTEREN: I think the Democrats may find a bigger fight in the next round, because I think that core group of freshmen Republicans in the House are going to feel emboldened tonight, because they held their ground on this from the very beginning. I think they are going to feel like they could do that every time.

That is going to make it much more difficult for the Democrats and for the Republicans to get things done.

SCHOEN: I think that's right. Ultimately, the big winner tonight were the Tea Party and the first and second term conservatives who came with a mandate to cut spending. Greta, let's be frank. That reflects what the American people want regardless of party, regardless of ideology. They want jobs to be created. They want the deficit reduced.

They believe that unless spending is gotten under control, we are not going to be as competitive as we can be.

VAN SUSTEREN: Did the American people win tonight?

SCHOEN: I think the American people won a short term victory. But unless we do what we need to do about the debt and the deficit, this is not an historic night. It's just a blip on the radar screen.

VAN SUSTEREN: The president called it historic. Senator Harry Reid called it historic. I don't know if the president did.

SCHOEN: I think the president is going to try to stay as far away from this as possible. Harry Reid will call it historic, even though it was 40 odd billion dollars worth of cuts beyond what he and the Democrats wanted, because ultimately the American people are far ahead of the Congress in wanting spending, and doing what you said before, which is to break the whole of the special interests and return government to the people.

VAN SUSTEREN: What happens to the Planned Parenthood issue?

SCHOEN: I think that is going to be a tough one, because I think Congress will vote in favor of the Republican position, the Democrats against it. I think ultimately it is a separate issue from the spending issues. That's about the only small bone the Democrats got, which is

getting the riders out.

VAN SUSTEREN: Except they are going to have to confront them when it comes down the road in a separate bill.

SCHOEN: They will. I think they can live with that now that the floodlights of America are not going to be on them.

VAN SUSTEREN: I think the Republicans set them up on that one. We'll see. Thank you.

SCHOEN: Thank you.