This is a rush transcript from "Journal Editorial Report," January 28, 2012. This copy may not be in its final form and may be updated.
PAUL GIGOT, HOST: This week on the "Journal Editorial Report," the fight for the Republican nomination moves to the Sunshine State. He's spending heavily and on the attack, but can Mitt Romney ride the comeback or will Newt Gingrich ride his South Carolina momentum to another big win?
President Obama makes his pitch to middle class voters, but will his policies deliver the economic fairness he promises?
The immigration debate takes a heated tone. Why two of Florida's most prominent Republicans are telling candidates to cool it down.
Welcome to the "Journal Editorial Report." I'm Paul Gigot.
The battle for the Republican nomination moved to the Sunshine State this week in what is shaping up to be a two-man fight between Mitt Romney and Newt Gingrich. Still fighting from his loss in South Carolina Romney is campaigning hard and spending big in Florida, trying to plant doubt in the minds of voters about Gingrich's behavior, his record in Congress and his work for the mortgage giant, Freddie Mac.
(BEGIN VIDEO CLIP)
MITT ROMNEY, R-FORMER MASSACHUSETTS GOVERNOR & PRESIDENTIAL CANDIDATE: Speaker Gingrich was hired by Freddie Mac to promote them, to influence other people through Washington, encouraging them to not dismantle the two entities. It was an enormous mistake. Instead, we should have had a whistle blower, not a horn tooter.
(END VIDEO CLIP)
GIGOT: Joining the panel this week, Wall Street Journal columnist and deputy editor, Dan Henninger; Political Diary editor, Jason Riley; and Washington columnist, Kim Strassel.
Dan, the large strategy for Romney, if you look at the polls, seems to be working. He is coming back and now has a lead in Florida in the average of polls. What do you make of what he's been doing?
DAN HENNINGER, COLUMNIST & DEPUTY EDITOR: I would say it's good news and bad news about what Romney's doing. The good news is that what he's doing is something he had to do. He had to crack back against Gingrich's criticisms of him and he had to do it very well. He is doing it very well. In the debate, Romney's criticism is showing he's capable of sternly and aggressively going after an opponent. There was no doubt about whether he was doing that against Obama. Turns out he's able to do it.
The bad news is what he's doing is he's getting down in the muck and mud wrestling with Newt Gingrich rather than spending time attacking the real opponent, President Barack Obama, on a whole array of reasons why Barack Obama should not be reelected president. He's telling us Newt Gingrich was a lobbyist in Washington, which we know.
GIGOT: He's hitting at vulnerabilities that are genuine. The Freddie Mac problem is a real problem. And it's the truth.
JASON RILEY, POLITICAL DIARY EDITOR: It is, but what I've been more impressed is Mitt Romney has appeared more comfortable in the last two debates, forcefully defending his record in the private sector and private equity, his wealth. His performance in the last two debates, in talking about why it's not a liability for the Republican nominee to have the background he has, it's an asset, something we should be proud of. And I think he's made that point very forcefully.
And what he's done in pushing back against Gingrich is taken on the extent to which Gingrich's attacks have been unprincipled, the class warfare rhetoric, Swiss bank accounts, as if Romney inherited this money and hasn't worked for it. He's pushed back and it's resonating.
GIGOT: Let's look at exchange with Rick Santorum and Romney on Romney's record in Massachusetts.
(BEGIN VIDEO CLIP)
ROMNEY: I believe the people of he's state should craft programs they feel are best for their people. I believe ours are working well. If I were governor it would be a heck of a lot better.
RICK SANTORUM, R-FORMER PENNSYLVANIA SENATOR & PRESIDENTIAL CANDIDATE: What Governor Romney just said is government-run, top-down medicine is working well in Massachusetts and he supports that.
SANTORUM: Think about what that means going against Barack Obama, who you'll claim top-down government medicine at the federal level doesn't work and we should repeal it. And he'll say, wait a minute, Government, you just said top-down, government-run medicine in Massachusetts works well.
Folks, we can't give this issue away in this election. It's about fundamental freedom.
(END VIDEO CLIP)
GIGOT: So, Kim, how well did governor Romney do in that exchange and follow-up to Santorum's charge?
KIM STRASSEL, WASHINGTON COLUMNIST: You have to love Rick Santorum. He's struggling in the polls but he's done something nobody else has forced Mr. Romney to do, which is to get in the weeds of the problem of Romneycare and the liability he will face as nominee. The governor has continued to say, you know, states should be allowed to do what you want. What Rick Santorum says is, no, what you fundamentally believe in and showed was that government-run healthcare is OK. How can you make that contrast? Mr. Romney didn't have a good answer because the answer has been states should be able to do what they do, and he's going to get caught on this.
GIGOT: He goes back to his talking points. Oh, he cut $500 billion from Medicare, Obama did. I didn't do that. As if Massachusetts had anything to do with Medicare and then floundering with his talking points that aren't accurate.
HENNINGER: There was a crucial important style distinction in what we saw. Mitt Romney says the system we have is quote/unquote "pretty good." And Santorum jumps on that aggressively and says you can't give the issue away by saying that sort of thing. In other words, I'm your debate coach. You cannot go against Barack Obama and talk like that.
GIGOT: Jason, you were impressed with Romney's performance but isn't this a vulnerability?
RILEY: It is, and Santorum scored hits. The question is to what extent this will be an issue in November. How much of the election will be about Obamacare --
GIGOT: Should it be about Obamacare?
RILEY: but should be economy and jobs. Obama doesn't want to talk about it.
You look at the polls on Romney on the popularity of Obamacare. It's complex and less popular by the month. Clearly, Romney is not the strongest candidate to go after it. He's saying I'll say I'm going work to repeal Obama care and hoping that's enough to neutralize the issue. We'll see.
GIGOT: We have one more clip of Rick Santorum talking about the other candidates.
(BEGIN VIDEO CLIP)
SANTORUM: These two gentlemen are out distracting from the most important issues by playing petty personal politics. Can we set aside that Newt was a member of Congress and used his skills he developed as a member of Congress to advise companies. And that's not the worse thing in the world. And Mitt Romney worked hard and is going out and working hard. You guys should leave that alone and focus on the issues.
(END VIDEO CLIP)
GIGOT: Kim, how much damage are these debates doing, in this exchange to the Republican candidates? That's what Santorum is saying, it's doing a lot of damage.
STRASSEL: Yes. You can see the White House smiling all the way from here. Voters expect their nominee to do two things, act as a conservative leader for a movement that lost its way, the other to defeat Barack Obama. It's hard to see how these guys advanced those causes in Florida. The problem is they may be turning off voters they'll need, Independents in particular, but also groups like Hispanics who have been watching the immigration debate and feel like the kicking people for people to score political points.
GIGOT: We want to talk about that later.
Briefly, why can't Santorum break through?
HENNINGER: It's just celebrity and the way the debates are structured, the primaries are structured. At the least, he should stay in. He's the real tortoise in the race.
GIGOT: When we come back, President Obama takes his State of the Union act on the road, targeting middle class voters in battle ground states with a call for economic fairness. Will his policies deliver what he's promising?
(BEGIN VIDEO CLIP)
PRESIDENT BARACK OBAMA: Tax reform should follow the Buffett Rule. If you make more than $1 million a year, you should not pay less than 30 percent in taxes. Now, you can call this class warfare all you want. But asking a billionaire to pay at least as much as his secretary in taxes? Most Americans would call that common sense.
(END VIDEO CLIP)
GIGOT: That was President Obama delivering his third State of the Union address Tuesday night. Whether you call it class warfare or common sense, Democrats call the speech a home run with swing voters. The latest "Wall Street Journal" polls show his approval rating climbing toward the 50 percent mark. Is President Obama back?
So, Kim, what did the speech tell you about what Obama's election strategy is going to be?
STRASSEL: Class warfare, class warfare, class warfare. The president tried to make the case the economy is doing better. That's a hard case to make. What this mostly was a populous pitch, the president ticking off a list of boogie men responsible for America's misfortune and then laying out ways to go after them, China, millionaires, companies that go off shore, financial firms that need prosecutors sic'ed on them. This is what he'll run on this fall.
GIGOT: Jason, the thing that struck me was that how little reference there was to his record. Talked about the auto bailout, for example, but health care, barely a mention. It's in the witness protection program, Obamacare --
You've got barely a mention of stimulus. No mention of deficit, except to take credit for the agreement with Congress that was more or less forced on him. Is this going to work?
RILEY: Fairness seems to be his theme and he's claiming --
GIGOT: You're not against fairness, are you?
RILEY: No, but he --
HENNINGER: Within limits.
GIGOT: Maybe Henninger is. I don't know.
RILEY: It's playing one American against another. No, people are unemployed because Buffett isn't paying enough in taxes.
That sort of thing. He's trying to connect dots like that. No, I don't think it will work. I don't think people envy the wealthy in this country to the extent he hopes. People want opportunity.
On his tax issue, not only did we see the opening calling for a minimum tax on millionaires but he wants to take the overseas profits on U.S. corporations, more complications for a tax code that everyone agrees is complicated. No real solutions here.
GIGOT: Dan, the 30 percent, this is a super minimum tax -- we have one but, this would be higher. Says it will only be on millionaires. But when the alternative minimum tax was imposed in 1969, that's what they said. Now it applies to millions of middle class families.
HENNINGER: Yes. Do you think the average American husband and wife out there struggling sit around the table saying, it upsets me that Warren Buffett doesn't pay as much as in taxes as his secretary. The thing these people have been thinking about for two years is we've had an unemployment rate between 8 and 9 percent and an economy growing under 2 percent.
GIGOT: But didn't you know it? Manufacturing is back, Dan, and three million jobs have been added -
-- in the last --
HENNINGER: And if we give more money to community colleges, everybody will be an electrical engineer.
This president is vulnerable and he knows it. He's trying to change the subject. The burden will be on his opponent not to change the subject.
RILEY: You know, the governor of Indiana, Mitch Daniels, gave a very good response to the State of the Union address. And once Republicans are done beating up on each other, they will do well to revisit the speech. He says to stress opportunity, the haves and soon-to-haves. Those are the themes we want to address to the country. That's what the Republican Party should focus on.
HENNINGER: My favorite was trickle-down government.
RILEY: It has not worked.
GIGOT: Kim, if this was not successful, why are Democrats so happy with it? That's the message we hear all week. They seem delighted by this and united behind it, and say, look, it's moving Independents. What's going on?
STRASSEL: Right, because I'm going to push back here. This could work. That's what Democrats are banking on, if you do not have a Republican candidate, nominee, to explain why all of this is wrong. You have to have somebody with a bold tax reform plan who says the reason why Warren Buffett pays less than his secretary is because we have a contorted tax code, that we need to streamline it. Only by doing that can you bring down taxes for everyone. If you don't have Republicans explaining this, breaking it and making that argument, they're sunk. Democrats are looking at Mitt Romney and thinking he won't do that.
GIGOT: Sorry, guys, but Mitch Daniels isn't in the race.
HENNINGER: You know who is? Rick Santorum. And he said last night he and Obama are competing for the same lower middle class, blue collar voters. I would like to see him elaborate on that.
GIGOT: All right, maybe he will.
When we come back, the immigration debate is heating up ahead of Florida's primary. And two of the state's most prominent Republicans are telling the candidates to dial it down. So, should they?
(BEGIN VIDEO CLIP)
ROMNEY: Mr. Speaker, I'm not anti-immigrant. My father was born in Mexico. My wife's father was born in Wales. They came to this country. The idea that I'm anti-immigrant is repulsive. Don't use a term like that.
NEWT GINGRICH, R- FORMER HOUSE SPEAKER & PRESIDENTIAL CANDIDATE: I'll give you an opportunity to self-destruct. You tell me what language you would use to describe somebody who thinks that deporting a grandmother or grandfather from their family -- just tell me the language. I'm happy for you to explain you would use.
GIGOT: Immigration has been one of the hottest issues in Florida where one in 10 likely Republican voters are Latino. A new poll shows Mitt Romney with a 26 pickup lead over Newt Gingrich with Hispanics, despite Gingrich's claim Romney is anti-immigrant. That accusation was made in a Spanish language radio ad that was pulled after Republican Senator Marco Rubio called it inaccurate and inflammatory.
Jason, who's getting the better of this immigration debate?
RILEY: The Democrats are.
They're getting the benefit of the immigration debate. The candidates are not very far apart on this. They spent 20 minutes at the last debate having a superficial decision about what to do with elderly illegal immigrants in this country as if they make up some huge number. They're trying to soften the tone in Florida, which has a large proportion of Hispanic residents. So that's why we're seeing less of a harsh tone than in Iowa and what we saw in South Carolina and other states. Long term, this is a problem for Republicans because a lot of swing states they'll need, Nevada, New Mexico, so forth, have large Hispanic populations.
GIGOT: Kim, how damaging was it for Gingrich that Rubio criticized the ad and they had to pull it.
STRASSEL: Hugely damaging. Marco Rubio is admired by those Hispanic Republicans who vote in Florida. He has stayed neutral in the race but the fact he said something about Newt Gingrich -- Newt Gingrich felt the need to apologize, that's how big it was.
The reality is Mr. Gingrich and Mr. Romney are better than many other Republican candidates on this but what the Hispanic community feels is they get used as a wedge whenever these guys want to kick on someone else about immigration.
GIGOT: It looks to me, Dan -- sounds to me as if Romney is softening his tone on immigration, saying I love legal immigration. I'm in favor of a guest worker program. Very different than the tone he struck against Rick Perry when Rick Perry, poor Rick Perry, all he favored was instate tuition for the children for college of illegal immigrants and Romney made it sound like a great magnet for illegals. Why the change?
HENNINGER: In 2008, Romney in Florida lost the Hispanic vote. John McCain, who had a softer position, got 51 percent of the Hispanic vote. Romney got 15 percent. so he needs help on that side. I'd go back to Rubio and bring in Jeb Bush as well. Those are the two most popular public figures in Florida. Neither are endorsing anyone, but both, especially Jeb Bush, said positive things about Mitt Romney. I think it adds up to a wink, wink support for Romney.
RILEY: Every time they talked about softening their tone on immigration, they come back with a second line about making English the official language of the U.S. That's a shot. Hispanic voters see that as a shot at them.
GIGOT: But polls show Hispanics voters actually favor that too.
RILEY: You don't need to make it official. Immigrants know learning English amounts to job skills, and raises their wages. They have every incentive to learn the language if they plan to stay.
GIGOT: Jeb Bush said he thought Republicans should talk not so much about border security, though you have to talk a little bit about it, but more about immigration as an economic opportunity and the economic benefits of it, Kim. Are Republicans doing enough of that?
STRASSEL: No. You know, he would know. Say what you will about President Bush's time in office but one thing he and his team understood was a need to get the Hispanic vote. And the Hispanic vote was a big part of their election in 2000 and 2004. You do that by casting a positive message. President Bush tried to get the party to do that in his later years in office. He was sort of pushed back on that. But what you need is a Republican nominee willing to take up that mantle.
GIGOT: Jason, how big a hole have Republicans dug for themselves with Hispanic voters?
RILEY: A very big hole. If there's any saving grace, however, it's that the Hispanic activists, Democrats, are not happy with Obama on this issue. And it's unfortunate Republicans aren't in a better position to take advantage of it. But Obama is worried about enthusiasm among Hispanic voters.
We have to take one more break. When we come back, "Hits and Misses" of the week.
GIGOT: Time now for "Hits and Misses" of the week.
Dan, first to you.
HENNINGER: This week, New York Governor Andrew Cuomo hosted a meeting in New York to discuss infrastructure policy with businessmen. But to sit in on the panel, the businessmen had to pay $50,000 apiece. Now, sometimes it's said Governor Cuomo's thinking about running for president. If so, it looks like he's spending time working out in the fundraising gymnasium.
GIGOT: All right.
RILEY: This is a hit for the Hoosier State. Indiana lawmakers passed right-to-work legislation this week, which means as a condition of employment a worker will not be required to join a union. Governor Mitchell Daniels will sign it, making Indiana the 23rd right-to-work state. Good for them, a more business-friendly state and it will attract more jobs.
GIGOT: First right-to-work state in a decade. So, a big deal.
STRASSEL: A mega-hit to the awe-inspiring Navy SEAL team that this week parachuted into Somalia and rescued two hostages, one American and one Dane, from Somali pirates. We've become so used to Special Forces pulling off these feats. There is a risk we think is routine. It never is. Each one is an amazing amount of training and operations and courage. And for that, these heroes deserve out constant praise.
GIGOT: Here, here, Kim.
Dan, is there any doubt that Andrew Cuomo is going to run for president in 2016?
He's going to have the money to do it and friends to do it.
GIGOT: I think so. Jason, any chance Mitch Daniels still gets into the Republican race?
RILEY: I don't think so. I don't think so. Because it looks like Romney is going to take Florida, and I don't think he'll be caught after that.
Remember, if you have your own "Hit or Miss," please send it to us at jer@FOXnews.com. Be sure to visit us on the web at FOXnews.com/journal.
That's it for this week's edition of the "journal Editorial Report." Thank to my panel and to all of you for watching. I'm Paul Gigot. We hope to see you right here next week.
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