This is a rush transcript from "Special Report," January 26, 2012. This copy may not be in its final form and may be updated.
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MITT ROMNEY, R - PRESIDENTIAL CANDIDATE: I think the character and judgment and sobriety and thoughtfulness that the speaker has been all over the place, just in this year on a whole host of issues. He says very inflammatory, exciting things, but his record as speaker shows that he hasn't been able to deliver in a consistent, effective way.
NEWT GINGRICH, R - PRESIDENTIAL CANDIDATE: Frankly, I do find it infuriating. I think it is one of the most dishonest things I've seen in politics. It is so fundamentally abusive. I mean at some level there ought to be a sense of shame that a person would be this fundamentally dishonest.
(END VIDEO CLIP)
BRET BAIER, ANCHOR: Well, just some of the sounds from the campaign trail today. A lot had to deal with Ronald Reagan, believe it or not. There is a super PAC that supports Mitt Romney, has an ad out. The Newt Gingrich folks pointed back to a piece of tape from 1995. We put the two of them together and take a quick listen.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: Gingrich exaggerates dropping Reagan's name 50 times, but in his diaries Reagan mentioned Gingrich only once. Reagan criticized Gingrich, saying, Newt's ideas, quote, "would cripple our defense program." Reagan rejected Newt's ideas. On leadership and character Gingrich is no Ronald Reagan.
NANCY REAGAN, FORMER U.S. FIRST LADY: Barry Goldwater, handed the torch to Ronnie, and in turn, Ronnie turned that torch over to Newt and the Republican members of Congress to keep that dream alive.
(END VIDEO CLIP)
BAIER: That was the talk on the campaign trail today. Here is the latest polls, quickly. Rasmussen -- Romney with a lead of eight points over Newt Gingrich. There you see Rick Santorum and Ron Paul. Monmouth University poll, this is out. Again, seven points for Romney up, percentage points. There you see. The Real Clear Politics average, this is an average of the recent polls, and you see Romney taking the lead. Gingrich had the lead in this average just yesterday.
Let's bring in our panel, Kirsten Powers, columnist for The Daily Beast, Mara Liasson, National Political Correspondent of National Public Radio, and syndicated columnist Charles Krauthammer. OK, Charles, let's start with the Reagan back and forth.
CHARLES KRAUTHAMMER, SYNDICATED COLUMNIST: Well, let's try to clear out the underbrush. Nancy Reagan is right that the torch was passed from Reagan to Newt. But that speaks to what Newt did in the '90s, not to what he did in the '80s.
On the other hand there's been an attack on Newt that he criticized Reagan, to which I say so what? Reagan wasn't a saint, he wasn't the Pope. He wasn't un-erring. He made mistakes. He admitted the arms-for-hostages was a mistake. Everybody at some point attacked Reagan on different issues. So that I think is irrelevant.
What is relevant is that Gingrich repeated the claim that I worked with Reagan in the '80s do x, y, and z, including to bring down the communist empire. Well, that is preposterous. First of all, foreign policy is presidential. The Congress has almost no say. If it has any, it's the Senate. It's not the House. If it's in the House, which has almost no say, it would be the majority party. Gingrich was a member of the minority party in the House all through the Reagan years, which nothing to say about almost anything. And he wasn't even in the leadership. He had no role whatsoever in the destruction of the Soviet Union. That was done by Reagan, Jean Kirkpatrick, George Schultz, Margaret Thatcher, the Pope, Helmut Cole, Andrei Sakharov and others. Newt is not on the list. And the fact that he keeps saying this is a sign, sort of a delusional sign, a sign of grandiosity. If that is the issue, he loses. If the issue is, was he a Reaganite in spirit, I think he has a good defense on that.
BAIER: Mara, the Romney campaign, the quotes that have been brought up by various columnists and folks all over the place. One of them Newt Gingrich telling the Wall Street Journal that Reagan was, quote, "in some danger of becoming another Jimmy Carter." I mean as Charles mentioned, there were a lot of quotes back and forth. But when the Gingrich campaign then puts out this Reagan video in 1995, isn't that the --
MARA LIASSON, NATIONAL PUBLIC RADIO: I think if you are going to have this debate, Newt is going to win. Now I think the question is why are they having this debate? This is not the main event here. The main event, I think the exchange of allegations about Freddie Mac and Goldman Sachs are much more relevant.
However, it's very possible that the Romney campaign is trying to get under Gingrich's skin. You know, you saw Gingrich in that press avail you just showed. He is hopping mad. And if he looks mad tonight, he looks too angry. That is, it's possible that Romney could get the moment that he has been waiting for in a debate where Gingrich is actually rattled.
But I do think, just on who is the Reagan conservative battle, I think Newt wins over Mitt on that one.
BAIER: And Gingrich's response, Kirsten, has been Mitt Romney voted for Democrat Paul Tsongas, back in 1992. He gave money to Democrats in 1994, and points to a Massachusetts moderate or now he's saying Massachusetts liberal.
KIRSTEN POWERS, COLUMNIST, NEW YORK POST: Right. I just agree with pretty much what you are saying, except going down the line, maybe they are trying to get under his skin. But the problem is that when Newt is mad, the person who suffers is Romney. He can't handle it. And he is mad. In Florida today, he kept saying over and over on the stump that he was mad. Do they think we're stupid. Ya know, ten times over --
BAIER: In South Carolina, he was mad.
POWERS: Right. Newt when he is mad really rattles Romney. And I think that is bad for him. And I think that the Romney people are overplaying their hand here. Does he think grandiose thoughts? Yes. He said that himself. None are more grandiose than what he thinks he did, vis-a-vis Reagan. But if you're gonna put these two up against each other who is more of the Reaganite, it's Newt Gingrich.
BAIER: The so-called establishment is coming out of the woodwork. Bob Dole releasing a pretty scathing comment today in a statement, quote, "If Gingrich is the nominee it will have an adverse effect on Republican candidates running for county, state, and federal offices. Hardly anyone who served with Newt in Congress has endorsed him, and that facts speak for itself."
He went on to say, "Gingrich had a new idea every minute when he was speaker, and most of them were off the wall. He loved picking a fight with Bill Clinton because he knew this would get the attention of the press. This and a myriad of other specifics helped to topple Gingrich in 1998." Bob Dole supporting Mitt Romney.
KRAUTHAMMER: I'm not sure that this will persuade a single Newtonian. And the reason is Dole didn't actually do that well in '96. He is exactly what the Gingrich people would say is what Romney is. He's the next in line, he's the establishment favorite, he is somebody who doesn't have a kind of fire and energy and sort of ideological fervor that Gingrich had. So I'm not sure that the Romney people using it, as I'm also not sure that Romney trying to fight on the grounds of Reaganism is a good idea, because if anybody was not a Reaganite that surely is Romney.
I just think it's interesting how my colleagues here are talking psychiatry and I am talking history. I thought I was the psychiatrist.
KRAUTHAMMER: But I just think the real problem Newt has is the claim of all the stuff he did. But he always has been. Essentially he brought Reaganism into the '90s. And on that claim, if that is the one he makes his stand on, he is right.
BAIER: Charles, who is the Republican establishment? Who is that? Is it you? Is it Karl Rove?
KRAUTHAMMER: Karl Rove is the president. We meet every month on the full moon. I've explained this. At the Masonic temple. And we have the ritual. Karl brings the incense. I bring the live lamb and the long knife, and we begin, as I've already explained, with a pledge of allegiance to the trilateral commission. That is how it works.
BAIER: That is a joking answer, but, Mara, I'm kind of serious with the question. In Washington, the Republican establishment is fairly conservative, is it not? I mean look at John Boehner, is he the establishment?
LIASSON: Sure, sure, it's conservative. That doesn't mean that it's a Tea Party. But it's anti-Tea Party. And the way that the fault lines in this race are shaping up is that Newt is running what he describes as an anti-establishment campaign. The establishment is the media, it's Mitt Romney, it's all the money, Wall Street interests, the anti-Tea Party interests in the Republican party.
But what you've seen is -- Newt has had two surges. And both of them have been squelched by tens of millions of dollars in, as he would put it, establishment funded attack ads on behalf of Mitt Romney. Now I don't know if Romney is doing it here. You can see the slipping of Gingrich's poll numbers. Gingrich has a chance tonight to see if he can pull off the same magic he did in South Carolina. The difference is that the last debate in South Carolina was two days before the vote. This one is four days. That is a huge difference.
BAIER: Quickly, is the Republican establishment moderate?
POWERS: Well, a lot of the Tea Party people think they are. Their main gripe with the establishment is --
BAIER: After 2010?
POWERS: They see them as being the people who helped George Bush spend all this money. So they think these are the same people that supported that and we don't like them and we don't like them telling us what to do.
BAIER: No Masonic temple either.
Next up, president Obama heads to some of the battleground states and a bit of a dust-up. Keep it here.
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