This is a RUSH transcript from "The O'Reilly Factor," August 26, 2011. This copy may not be in its final form and may be updated.
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JUAN WILLIAMS, FOX NEWS GUEST HOST: In the "Factor Follow-up" segment tonight, according to a Gallup poll earlier this week, Texas Governor Rick Perry is now up 11 points -- let me repeat that -- 11 points over Mitt Romney. And things are getting a little heated on the campaign trail for Mr. Romney.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: How do you think the government cannot provide funds for the people, its citizens?
MITT ROMNEY, GOP PRESIDENTIAL CANDIDATE: OK. Let me answer the question. Of course government provides funds for its people, the citizens. Of course we take care of America when there are national disasters. Of course we honor our promises to seniors. And so -- of course it costs money. But not more than you take in. Fifty states in America, 50 states in America balance their budget every year.
Fifty states in America balance their budget every year. I balanced a budget every year. Let -- you had your turn. You had your turn, madam. Let me have mine. Let me have mine.
Listen, I'll give you the microphone in a moment, but let me complete. I'm sorry. It's my turn. You had yours. Now it's my turn. Would you please hold on a moment and let me finish?
(END VIDEO CLIP)
WILLIAMS: Joining us now from Charlottesville, Virginia, Dr. Larry Sabato, the director at the Center for Politics at the University of Virginia. And with us here in New York, Democratic pollster and Fox News analyst Doug Schoen.
Gentlemen, let me just begin with a simple question. Is Mitt Romney on the ropes, Dr. Sabato?
DR. LARRY SABATO, DIRECTOR, CENTER FOR POLITICS, UNIVERSITY OF VIRGINIA: Juan, he's on the ropes. In fact, he's no longer the frontrunner. He's always been a weak frontrunner. I've never seen him over 30. Doug keeps up with the polls better than I do. But I have never seen him over 30 percent in a national poll. He's generally been in the upper teens or low 20's. And I think Perry, at least for the time being, is now the new frontrunner.
DOUG SCHOEN, FOX NEWS ANALYST: I think Larry is right. I looked at a bunch of state polls today: South Carolina, Iowa, Florida. Perry is surging. Romney is sinking. And bottom line, when a frontrunner is as weak as Larry says that Romney was and is, then he's no longer the frontrunner.
WILLIAMS: Well, but this is an intriguing moment. One, do you think it's going to last for Perry, because I think the American people in general don't know Rick Perry at this point. They're coming to know him. So is it a temporary ephemeral moment in the polls? Or do you think it's really the case that Rick Perry now is the frontrunner in the Republican race for the nomination -- Doug?
SCHOEN: Well, here's the thing. I think that Rick Perry fills a void but hasn't answered the question. The void is there are a lot of Republicans who are unhappy with the seven or so candidates who are running before he got in the race. He doesn't answer the question whether he's a credible challenger to President Obama. Time will tell. But, bottom line for the time being he provides an alternative for the Republicans who are dissatisfied.
WILLIAMS: Now Larry, you know, this is interesting. Because I saw a poll today for the first time indicated that most Republicans are suddenly satisfied with the field. And I got to believe that's because Rick Perry has gotten into the field. Otherwise, previously, they were all saying they wanted someone else to jump in. And if they are satisfied with the field, what does that mean for Sarah Palin?
SABATO: Well, first of all, we'll see whether that lasts. I think Doug is right. People don't know who Perry is. They are looking at an image, and they're saying, "Oh, thank goodness, somebody else is in there, because I looked at the other candidates, and it seemed like we were fielding the JV team instead of the varsity team."
But, look, Rick -- Rick Perry has got to reestablish the connection between the brain and the tongue. If you make enough gaffes, it's going to catch up with you.
As far as Palin is concerned, she can jump in. I think that segment of the electorate that might be oriented toward her is pretty divided up at this point.
WILLIAMS: Well, Larry, what does Romney have to do to get off the ropes? Can he start throwing punches at Perry? What should he do? If you're advising him, tell me right now.
SABATO: Well, I'm not much of an advisor, but you know, I'm a great believer in luck. You either have good luck or bad luck in politics. And the truth is, I don't think there ' a lot Romney can do. I think he has to hope that Perry continues to make mistakes, that gaffes and sandals overwhelm Perry at some point and that he's the remainder candidate, because that's the only way Mitt Romney is going to get that nomination, as the remainder candidate.
WILLIAMS: Now, let me ask you something, Doug. If Rick Perry is the Republican nominee, I can imagine the Obama people painting him as extreme. So is it good news for President Obama that, all of a sudden, Rick Perry is the leading candidate for the Republican nomination?
SCHOEN: I think this is playing out about as well as the White House could want. Because, you still have a divided field. Rick Perry's frontrunner, but he's by no means locked the race up. He'll be attacked by the Republicans. The White House, through independent groups indirectly, will attack him.
And if it's a bloodied-up Rick Perry who is extreme and gaffe-prone, against a president who has really got serious problems on the economy and on leadership, then the White House has a fighting chance to win this election.
WILLIAMS: Wow. And you know, he's just come back. President Obama has come back a day early from his vacation, gentlemen. But his numbers, they're not looking good. His numbers now are pretty low. He's now at about at a 40 percent approval rating. That's lower than Clinton, lower than George W. Bush, George H.W. Bush. I'm wondering at this point if you think that his numbers, you know, is there anything he can do? Libya hasn't helped him. Bin Laden hasn't helped him.
So Larry Sabato, what's going to help the president?
SABATO: There's only one thing that could possibly help, and that is, against all expectations, the economy gets a lot better a lot faster than the experts in that field think it can. That's the best thing that could happen to him, along with the Republicans dividing and nominating a weak candidate. Again, oddly enough, President Obama could end up being the remainder candidate.
But, look, with his numbers, he ought to be grateful for just one thing. That the election is in November 2012 and not November 2011.
WILLIAMS: Right, but Doug, you hear Larry say, "You know what? Jobs, the economy gets better quickly." He's got a big speech scheduled right after Labor Day. That speech has everything riding on it. I mean, you know, back from the hurricane. This is not going to be Katrina, I don't think, from a government point of view.
SABATO: Juan, here's what's going to happen. You're going to get a speech where he recycles some of the proposals he's already made about payroll taxes and extending unemployment benefits. A few new ideas that will be centrist. He'll say, "The Republicans are opposing me because of politics." I think you're going to get Bernanke probably doing QE 3 and then a ferocious attack on the Republicans that will be unrelenting. That's what the president...
WILLIAMS: We're just going to have, as Bill O'Reilly likes to say, the most negative campaign you've ever seen, because both sides are going to be throwing dirt on the other guy.
SABATO: I think you can bet on it.
WILLIAMS: Doug, Larry, thank you, gentlemen.