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Sunday Morning Futures

Senate majority a toss-up before Election Day; long-term outlook for the US economy, global recovery

This is a rush transcript from "Sunday Morning Futures," November 2, 2014. This copy may not be in its final form and may be updated.

MARIA BARTIROMO, HOST: Another year ending in an even number, another national election coming right down to the wire. Good morning, everyone. I'm Maria Bartiromo. Welcome to "Sunday Morning Futures."

Tuesday night promising to be another nail-biter with so many Senate races running so close. Larry Sabato will join us with his famous crystal ball to walk us through the contests that could decide just which party will control the Senate next year.

But first, if Republicans do take control of both houses, they have big plans on their agenda. The chairman of the National Republican Senatorial Committee will tell us what's in store.

And why so much uncertainty? The economy, of course. Poll after poll shows it is the number one concern driving Americans into the voting booths. We will get the long-term forecast from the president of the Richmond Federal Reserve, as we look ahead on "Sunday Morning Futures."

So how tight is the race for the Senate majority? Well, consider this. The Republicans need to win just six races on Tuesday, and according to a Real Clear Politics polling average, eight states are tossups right now.

Jerry Moran is the United States senator from Kansas, where his colleague, Senator Pat Roberts, is in one of those hotly contested races.

Senator Moran is the chairman of the National Republican Senatorial Committee.

Senator, good to have you on the program. Thanks so much for being here.

SEN. JERRY MORAN, R-KAN.: Maria, I'm glad to join you. I, with all Americans, are anxious for Tuesday to come and results to be determined.

BARTIROMO: Yeah, how are you feeling, though, about the race in your home state, given the fact that it's so close? What if we actually do have a runoff and we don't know who is in charge until January?

MORAN: Well, I hope we have every result and the outcome is determined on Tuesday night, Wednesday morning, but there are a couple of states in which runoffs are predicted. There's only a few states, mostly in the South, that require 50-plus percent. Two of those are Georgia and Louisiana, and again, races that could determine the outcome of the United States Senate, but my best prediction is we'll know more than that come Wednesday morning.

BARTIROMO: Well, I guess, you know, come Wednesday morning, the focus will turn to if in fact we were to see the GOP take control of both houses, what is the agenda?

So give me your one or two or three highlights that you want to see both houses get to work on right after these midterm elections?

MORAN: Maria, I think you outlined it in your intro, which is the economy. It's jobs. It's middle America. It's everyday Americans. It's the middle class. People need security. They need to know that their job is secure. They need to know that there are more opportunities for their children. They need to know that, when their kids graduate from college or technical school, that there is an opportunity for them.

I think, front and center, is jobs, and I would tell you I've only been a United States senator for four years, but in the time I've been a senator, in my view, the United States Senate has done nothing to help middle-class America reach that goal of financial security and a certainty that jobs are going to be available.

BARTIROMO: All right. Senator, I want to talk about what that really means and in the practical sense what kind of bills might you bring forth, in terms of actually creating those jobs. So stay with us. We'll get into that. A lot to talk about with you this morning, Senator Moran.

But first, President Obama may be having popularity problems during these upcoming midterms in his second term, but recent history shows us he's not alone. Fox News senior correspondent Eric Shawn with that angle this morning.

Good morning to you, Eric.

ERIC SHAWN, FOX NEWS SENIOR CORRESPONDENT: Good morning, Maria, and good morning, everyone. He has been "a drag," quote. So says embattled Arkansas Democratic Senator Mark Pryor about President Obama -- a drag not just for his race but for some of his fellow Democrats as well.

The political wisdom has long held that the incumbent president's party loses seats in the midterm. Tuesday may not only prove that maxim again but also shake up and reject the Obama legacy.

Take a look at the latest Fox News poll that shows right now 41 percent of voters approve of the president's job performance, but the majority, 54 percent disapprove. You know, in the midterms four years ago, the president had the same approval ratings. Fewer, though, disapproved. The Democrats -- well, they still suffered what the president called "a shellacking" by the Tea Party Republicans.

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RICHARD GOODSTEIN, DEMOCRATIC ANALYST: Historically, going back 100 years, with very few exceptions, on average the president's party loses 30 seats in the House -- we know that's not going to happen -- and a handful in the Senate, which, if the polls are right, seems like it's possible.

(END VIDEO CLIP)

SHAWN: Well, two years into President George W. Bush's second term, in the 2006 midterms, the Republicans lost the House and the Senate, and the president called it "a thumpin'." Fifty-four percent, the same as President Obama has now, also disapproved of Mr. Bush back then, and 38 percent approved.

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FORMER PRESIDENT BILL CLINTON: I want to say one thing to the American people. I want you to listen to me. I'm going to say this again. I did not have sexual relations with that woman, Ms. Lewinsky.

(END VIDEO CLIP)

SHAWN: And then there's Bill. You know, after that infamous denial in 1998, his approval rating remained sky high at 67 percent, and the Republicans still lost five seats.

And two years into President Reagan's second term, the 1986 midterms, while the Democrats did take the Senate, many predict that will happen again on Tuesday but in reverse, proving once again that the most powerful man on earth sometimes is really no match against the wishes of his citizens. Maria?

BARTIROMO: Really great analysis, Eric. Thank you so much for that.

More now with Senator Jerry Moran. And, Senator, how important do you think is the President Obama component of this? Are people going to vote against their local representative's policies because they are after all the same as President Obama's policies? How much of a drag will he be?

MORAN: Well, you make a great point, which the Democrats are trying to distance themselves from President Obama but the reality is, in the states that we're running races in which there are Democrat incumbents, they voted with President Obama 97 percent, 98 percent, 99 percent of the time. And now you listen to them in the campaign -- in their campaigns, and they're suggesting that they had nothing to do with President Obama's agenda; that was the president.

The reality is that the way Senator Reid, the majority leader, has run the United States Senate, it was to adopt the president's agenda during the time in which the Democrats had the majority in the House and then thereafter to protect it. And one of the things, when you asked me what would be a difference between now and a Republican majority in the future, what I would say is we'll actually do some work, as compared to the plan that Senator Reid, which is to do nothing -- no debate, no amendments, no votes.

And in my view, that is an attempt to try to protect those Democrat incumbents. In fact, the four years I've been in the United States Senate, the Senate has not functioned the way that it should. The plan has been to do nothing, very few votes, very few issues. And what that's designed to do is to protect Democrat incumbents from having to choose between President Obama's policies and what many voters back home object to.

And so to protect incumbent Democrat senators, the few votes we've had, they voted with the president, and in the last four years, we just haven't done nothing, which is defending the president's agenda.

BARTIROMO: Right.

MORAN: Those Democrat senators who are up for election now should be held accountable for the do-nothing Senate of Harry Reid.

BARTIROMO: Well, how are you going to change the do-nothing Senate, though? You know, at the end of the day, the president can veto whatever he'd like. So why should anyone believe that the next two years is actually going to produce something that gets done to impact the lives of American people?

MORAN: Well, first, to start with, you would have a Senate leadership with a desire to work, in many instances, across the aisle. Democrats are frustrated; Americans are frustrated with the way the Senate operates. This is -- this is an opportunity for us to resolve issues.

Take the votes. People complain how partisan the United States Senate is. If we were actually casting votes and decisions were being made, boy, we could resolve some of these issues.

I would say that, to start with, you would have a Senate that would pass a budget, something that has not happened in a long time, and then 12 appropriation bills that fill in the blanks.

And so, one, we would be addressing spending, but, two, we would be able to give better direction to the Obama administration how the money can be spent.

BARTIROMO: Right.

MORAN: And currently, all we do is pass a continuing resolution that lets the agencies and departments pretty much do what they want to do.

BARTIROMO: This is a really important point. OK, so pass a budget. That's number one priority. Give me one or two top sectors or, you know, policies that you want to get done in the next two years, and how do you do it? What's a practical jobs bill?

MORAN: Well, a practical place to start -- I mean, again, jobs front and center, but energy issues can really help our country. This has to do with what you pay when you send the check to your utility company at the end of the month to pay for your light bill. This has to do with what you pay for when you put your credit card or debit card into the tank at the gas station. That would be a big help, if we could generate the opportunity to produce our own energy, our own power.

Keystone Pipeline is an example of where we could make ourselves more energy independent, less costly, and protect our country's security as well.

So I would say a huge component of creating jobs in this country is developing energy sources that the Obama administration has really, through regulation, executive orders and policies, have really taken off the table, driving up the cost for everyday Americans.

BARTIROMO: And you don't think the president will veto those energy issues?

MORAN: Look, we have the opportunity to -- to send bills to the president. Some of them, he may veto, but it's important for us to develop an agenda. I would also say that, as the bills have come from the House, for example, most of those bills that are sitting, so-called, on Harry Reid's desk, the 350, 400 bills that the Senate has never taken up, most of them are bipartisan with Republican and Democrat support.

BARTIROMO: Right.

MORAN: There are lots of issues in which the United States Senate could deal with issues in a bipartisan way in which they are then sent to the president and the president can decide whether or not he vetoes them. They also can be included in appropriation measures, and the president can weigh the balance as to whether he wants to shut down government or approve policies that are generally supported by the American people and by Republicans and Democrats in the United States Senate.

BARTIROMO: OK. We will be watching. Passing a budget, focus on spending, and rallying around those energy issues.

Senator, we'll be watching. Thanks for your time this morning.

MORAN: Thank you, Maria.

BARTIROMO: There are of course just a handful of races that could decide our political fate. We will take a look at the factors that could affect which way these races go on Tuesday with prognosticator Larry Sabato.

I hope you'll follow me on Twitter @mariabartiromo @sundayfutures. Send me a tweet right now. Let us know what you'd like to hear from Larry Sabato as well as the head of the Richmond Federal Reserve, Mr. Lacker, coming up. Stay with us as we look ahead on "Sunday Morning Futures."

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BARTIROMO: Welcome back. Several races remain too close to call, and there is a good chance that we will not know who wins the Senate majority on election night. So says my next guest, whose political newsletter, "Sabato's Crystal Ball," has become famous for its fair analysis and accurate predictions over the past 12 years.

Larry Sabato is the director of the Center for Politics at the University of Virginia. And we welcome you to the program, Larry. Good to see you.

LARRY SABATO, DIRECTOR, UVA CENTER FOR POLITICS: Thank you, Maria. Nice to be here.

BARTIROMO: I want to walk through some of these hotly contested races. Let me get your observations on some of these. Broadly speaking, though, you don't think we're going to know who controls the Senate on election night?

SABATO: Well, not on election night, because you're going to have probably at least one runoff. You might have another one in Georgia, although you might not. And Alaska takes forever to count. But I'm increasingly confident of our January prediction at the Crystal Ball that the Republicans will control the Senate, and I think it will be by more than one seat.

BARTIROMO: All right. So let's talk about that and where that seat comes from. Take us through the Louisiana Senate race first because this is probably the most contested one. Is that right, in terms of possibility of a runoff?

SABATO: Yes, that will -- that will almost certainly end up in a runoff. And the runoff is in early December. You -- you don't want to jump too far ahead. There could be gaffes and new issues. But I think Senator Mary Landrieu has probably met her match. She's going to have great difficulty winning this year.

BARTIROMO: And what do you think is the main, most important issue for voters in Louisiana?

SABATO: Oh, it's President Obama. Look, this election, like many midterm elections, has been nationalized. And, typically, in the sixth year of a two-term presidency, as Eric Shawn showed you earlier, the -- the opposition party is energized against the incumbent president, and that's exactly what's happened here. Republicans are going to win quite a number of red states and a couple of purple ones, Iowa and Colorado.

BARTIROMO: Let's move onto Georgia, where you've got Perdue and Nunn in a -- you know, so close, down to the wire. What's the main driver here, in terms of voters? And how do you see this one playing out?

SABATO: That one has been a surprise because Michelle Nunn and, for that matter, Jason Carter, running for governor, Jimmy Carter's grandson, have made these contests real races.

Having said that, while Georgia is changing and it won't be that many election cycles before Georgia is purple, it's still red and therefore I would expect both Republicans for Senate and governor to end up winning.

BARTIROMO: All right. Onto Alaska, where you have got -- wow, the numbers are so incredibly close. What do you -- how do you see Alaska playing out?

SABATO: Once again, that's a deeply red state. Now, here's an example of a Democrat who has run a great campaign, Mark Begich, a one-term incumbent senator. He's done everything right. He's organized well. But the national mood is washing over even Alaska, as far away as it is, and it's once again anti-Obama sentiment that probably will elect Dan Sullivan, the Republican nominee.

BARTIROMO: And -- and we won't know right away because, as you said, it takes forever to do the count there in Alaska.

What about Kansas? We just spoke with Senator Moran. You've got Pat Roberts right up against Greg Orman.

SABATO: Yeah. I think everybody's nominee for worst campaign of the year is Senator Pat Roberts. He's been in Congress for 34 years, and in ruby-red Kansas, is in a tied race with an independent who has no real organization, the way the Republicans do.

If I had to guess -- and it's dead even. If I had to guess, it would be that Republicans will be able to pull Pat Roberts across the finish line. It's incredible that they have to exert so much effort to do so.

BARTIROMO: Yeah. As we look at the -- navigating the Iowa Senate race, what do you think is the, sort of, most important theme? And do they -- are they all together and unified in terms of the theme that each candidate on the Republican side is stressing in getting voters motivated?

SABATO: Well, there's no question. Again, Joni Ernst, who we installed as the favorite weeks ago, and I think the polls have finally come around to reflecting that, is strongly anti-Obama, anti-Obamacare, a whole list of issues. The economy plays into that race as well.

And let's remember Republicans in the past several cycles have had candidates who have made terrible gaffes that have cost them the election. Well, here you've got a Democrat, Congressman Bruce Braley, who has made some gaffes and he has greatly weakened his position as a consequence.

BARTIROMO: Let me ask you this, Larry, before you go. Of course the day after Election Day begins the campaigning and the -- and the talk about the 2016 election. Any early observations about what we're seeing in the face of all of this anti-Obamaism?

SABATO: Yes, and you're absolutely right. We never get a break. The 2016 race will begin the day after this one's over. My caution to people would be do not connect the midterm to the presidential. It's two years away. That's four political lifetimes. And people are too inclined to think that the results of one election predict the results of the next. Generally, they don't.

BARTIROMO: Very interesting. All right. Larry, good to have you on the program. We will be talking to you a lot in the next couple of days. Thank you so much.

Larry Sabato, joining us.

And topping the agenda of course for the next several years, jobs, jobs, jobs. Will the economy cooperate? We'll get the long-term outlook from the president of the Richmond Federal Reserve. Jeffrey Lacker is with me today on set as we look ahead on "Sunday Morning Futures."

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BARTIROMO: Welcome back. President Obama set to meet with Federal Reserve Chairwoman Janet Yellen tomorrow one day before Americans head to the polls for the midterms. They are set to talk about the long-term outlook for the U.S. economy and the global recovery.

Jeffrey Lacker is with me today. He's the president of the Richmond Federal Reserve.

Good to see you on the program.

JEFFREY LACKER, PRESIDENT, FEDERAL RESERVE BANK OF RICHMOND: Great to be here, Maria.

BARTIROMO: Thank you so much for joining us, Jeffrey.

LACKER: My pleasure.

BARTIROMO: Let me kick it off with your analysis of where we are in this economic recovery. We know the Federal Reserve announced the end of quantitative easing or the bond buying program last week.

How would you characterize things today?

LACKER: Given the economic challenges we've faced, I think this economy has turned in an excellent performance. We've been growing; this is the sixth year of our recovery. We've grown at about 2.25 percent in an annual rate. The unemployment rate has come down from 10 percent to 5.9 percent and inflation is low and not a problem.

I think it will continue at about that pace. I think we're poised for growth ahead. As I said, that's all conditioned on some major challenges we face.

BARTIROMO: Does anything change if in fact we were to see the GOP take control of the Senate?

We're all navigating these midterm elections on Tuesday.

Do you think this is a material difference in terms of what we might see from the economy, depending on who is driving the Senate?

LACKER: Well, keep in mind at the Federal Reserve we studiously avoid making predictions.

BARTIROMO: I know that.

LACKER: I don't see major consequences for the economy one way or the other. I would like to see gridlock broken up in Washington and I'd like to see some resolution on some important national issues we face and the sooner uncertainties are resolved about those one way or another, either way they go, I think the better for economic growth.

BARTIROMO: I want to get into the regulatory environment in a moment because particularly when it comes to the banking sector, we've seen leadership on the Fed's part in terms of where we're going and what we may see.

But let me stay on the economy for a moment because, for the longest time, well, not the longest but since 2008, the Federal Reserve has had in place some sort of quantitative easing program and last week we know that the Fed has said that you're done with quantitative easing. You finished the bond buying program.

For the longest time a lot of people feel that the Fed has been letting these guys off the hook, in Congress and the president, in terms of being there, providing stimulus for the economy and giving them a pass to not do anything.

Does that change now that the Fed has done with QE?

LACKER: I don't know. So first of all, letting them off the hook wasn't our intention. We intended to provide the stimulus that the economy needed. There was debate about the size of these quantitative easing programs, but keep in mind that, even though we stopped buying them, we still hold those securities.

And so we still have the tremendous amount of reserves we put into the banking system. They are still there. So that stimulus is still there as long as we hold onto those and as long as we don't start selling them.

Next year sometime, it looks plausible that we'll start needing to increase interest rates. And we'll time that and try and time that carefully, given what the economy needs. But it wasn't done out of any calculation to let them off the hook. We think -- I think the problems the economy faces are pressing enough; they ought to be able to act on their own gumption.

BARTIROMO: Absolutely. Particularly when you have got the threat of the global economy slowing down and the impact we could see on earnings.

Will that become an issue if, in fact, we see Europe deteriorate further, China slow down further?

Does that change what you will do in terms of interest rates and when you will start moving on rates next year?

LACKER: We always take on board a global outlook and what it means for U.S. exports and growth. That's always going to be the case. Europe has been growing very poor rate for quite some time, they've been in the doldrums really. China has been growing very rapidly. Slowed off a bit in the last couple of years. But they seem to be managing that well.

So I am not expecting huge surprises there. Japan has been struggling for some years as well. So stagnant growth abroad wouldn't change the outlook much. We've been getting that for the last couple years and seem to have managed to cope pretty well nonetheless.

BARTIROMO: Central banks around the world have become the leadership in terms of economic stories.

What is your take on what happened the other day in Japan, where the central bank there created -- instituted new stimulus and surprised the markets and caused this amazing rally in Japanese stocks?

LACKER: Well, a year or two ago, they raised expectations about their ambitions for their policy moves and they are taking that very seriously.  They were falling short on some metrics they had talked about. So it looks like they are taking it very seriously, trying to provide all the stimulus they can in whatever form they can.

BARTIROMO: Let me ask you about the regulatory environment here in the U.S. Whether it's the banking sector being too big to fail or the idea that all these banks have to raise more capital, where are we at this point in terms of the financial services sector?

Have we gone too far in terms of instituting too many, you know, constraints that it's actually stopped them from lending?

LACKER: That's a good question. I think it remains to be seen.  We've done a lot. Dodd-Frank required a lot of things and we have implemented a lot of those. One of the most important ones remains to be fully implemented and that's the requirement that these large financial institutions, write-down resolution plans, living wills.

What would happen if they failed and they had to be resolved in bankruptcy without government support and not requiring the bailout in other words? Those plans have come in; a couple drafts of them have come in. The regulators who are in charge, the Fed and the FDIC have said, no, they're not sufficient yet and they're not credible.

We need some more iterations of that in order to get to the point where we can credibly choose bankruptcy rather than bailouts of these large institutions.

Until we get to that point, we won't have the strong incentives that competitive market forces can provide that can force these institutions to manage risk more soundly. We're doing that on the regulatory side, but we need help from market discipline to get the banking system back to where it needs to be.

BARTIROMO: But because of this uncertainty, do you worry that something that one of your colleagues said about a week and a half ago -- that was James Bullard -- that maybe the Federal Reserve should think about a whole new bond buying program. Quantitative easing 4 because we have all these uncertainties.

LACKER: Well, I'll let President Bullard speak for himself. I supported ending the bond buying program at our meeting last week.

And our policy's always contingent. We always try and emphasize and we added Langshore's (ph) statement last week to even further emphasize that what we do will depend on how the data comes in and we don't put things on preset courses. And James Bullard takes very seriously that, yes, we aren't on a preset course. And I spoke accordingly, I suppose.

BARTIROMO: So we've got the jobs numbers out in about a week and we'll see how they do. We've been --

LACKER: It'll be interesting.

BARTIROMO: -- each month.

LACKER: And we've been doing pretty well. The job market has been just really surprisingly good over the last several years, despite the challenges we've been in. Still, it's not showing the fluidity and dynamism that it used to show.

BARTIROMO: All right. President Lacker, good to have you on the show today. Thank you so much for spending the time with us, Jeffrey Lacker joining us.

Jobs and wages certainly driving voters. There are also social issues or is Tuesday a referendum on the president? We'll talk with our panel next as we look ahead on "Sunday Morning Futures."

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SHAWN: From America's news headquarters, I'm Eric Shawn. Here's some of the other stories we're following for you at this hour.

Police are now looking for the driver and passenger of an SUV that hit and killed three teenage trick-or-treaters in Santa Ana, California. That vehicle, a black Honda, was abandoned near where that tragedy happened.  Police know the address where that car is registered, but the owner no longer lives there. The victims, three girls range in age from 13 to 15 years old.

And in other news, climate change is happening, attributing it almost entirely to human activity. The panel says emissions may have to drop by zero by the end of the century to avoid potential dangerous rises in the global temperature, but to accomplish that, they would have to quit using oil, coal and gas to power the energy system. Critics, of course, have said that climate change, though, is largely not manmade.

I'll be back with Arthel Neville at noon Eastern for half an hour of news and the doctors as always will be in, Drs. Siegel and Samadi for "Sunday Housecall" at 12:30. For now, I'm Eric Shawn and back to "Sunday Morning Futures" with Maria.

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BARTIROMO: All right. Welcome back. I'm excited to have the panel with me here. Let's get right to the upcoming midterms.

What is bound to happen on Tuesday night?

What will it mean for Washington and the rest of the country? We bring in our panel. Judith miller is an adjunct fellow at The Manhattan Institute for Policy Research. She's a Pulitzer Prize winning author and journalist and a Fox contributor.

Mary Kissel is an editorial board member of The Wall Street Journal.

And Tony Sayegh was press aide to Jack Kemp when Kemp was the GOP vice presidential nominee. He's now president of a talk radio news service and a Fox News contributor.

Phenomenal panel today as we approach a big day on Tuesday night.  Let's talk about a lame duck session potentially and what President Obama, how he's going to react, if in fact we see the GOP take the Senate.

What's your take, Tony?

TONY SAYEGH, GOP STRATEGIST: Well, the only time this president ever negotiated in a bipartisan way was during a lame duck session after he was, in his own words, shellacked in the 2010 election.

There are major tax reform and tax credit plans endorsed by both Republicans and Democrats, specifically the R&D tax credit supported by 32 Democrats in the House when it came up to a vote. You'll see immense pressure on this president in the lame duck to take on these sensible either extensions or making these tax credits permanent to at least show that business can go on even in light of what's likely to be a major loss for him and his party on Election Night.

BARTIROMO: But will he do it, Mary?

MARY KISSEL, EDITORIAL BOARD, THE WALL STREET JOURNAL: I'm not optimistic at all. There's zero evidence that this president has any interest in compromising with the GOP. Over the last six years he's had opportunities on the budget, on immigration, on tax reform, on entitlement reform and he chose not to do that.

Tony says a lame duck after 2010, President Obama was still looking towards the second term in office as president. He's not looking towards anything else anymore. I think what he's going to do is he's going to demonize the GOP. He'll say that he wants to compromise but he'll do the same thing behind closed doors that he did the last time around.

He'll say, well, you want tax reform? Give me a big minimum wage increase. This is how he operates behind closed doors.

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BARTIROMO: Quid pro quo?

KISSEL: He's not a compromiser.

BARTIROMO: He's not a compromiser, but does he care about his legacy, Judy?

Doesn't he want his legacy to include I got this done beyond ObamaCare, which has failed?

JUDITH MILLER, AUTHOR AND JOURNALIST: He does. And he'll have ObamaCare and he'll be happy about that. He'll have a strong economy, he thinks, going into the 2016 and I think he wants some sensible tax reform that doesn't hurt the middle class.

And I think he is willing to compromise. We've seen a very different foreign policy, a national security policy from him very recently since ISIS came along and I think we are going to see if he loses control in the legislature, I think we'll have to see something because he does want a legacy --

KISSEL: The challenge for GOP is to force the president to take tough decisions. They should go to him with piecemeal immigration reform, force him to veto it, go to him with the ObamaCare medical device tax and say you don't want to give relief to companies that actually Democrats like Elizabeth Warren want to see relief for?

There's a lot the GOP could do to force him to make tough calls.

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SAYEGH: Mary's point is right in that this president clearly has obstructed more than he's worked across the aisle. We've seen it not only with Republicans, even Democrats in his own party have been frustrated, Maria. This is what's going to change the dynamic, I think, in these next two years.

The president doesn't have any skin in the game. He's leaving. I'm not sure he cares about the legacy. But Democrats are going to care about who wins the White House in 2016 and potentially gets to take back the Senate in 2016, so they'll have to negotiate and force the president to do so.

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MILLER: Never forget that. He has a lot of leeway just to what he can do with or without a Congress.

BARTIROMO: I mean, what you guys are saying is has he checked out?

Does he not care about his legacy? Does he not care about who is going to be in the White House in 2016?

KISSEL: He already has his legacy. His legacy was Dodd-Frank and ObamaCare. He's looking to do a nuclear deal with Iran, which is a whole other topic, which absolutely is a terrible idea.

But it's incumbent on the GOP not to give in and make bad deals with this president if they control the Senate. They shouldn't be sucked into terrible tax reform. They should hold out and wait and stand for their principles and force him to take tough votes.

BARTIROMO: I want to talk about what that tax reform looks like.  Stay with us. Let's get a look at what's coming up on "MediaBuzz" at the top of the hour. Howie Kurtz standing by right now.

Howie, good morning to you.

HOWARD KURTZ, HOST, "MEDIABUZZ": Good morning, Maria. We're in New York as you know. The star studded midterm special. We'll get polls, pundits, pontificating with Andrea Tantaros, Rich Lowry, Chris Stirewalt, Frank Luntz, John Roberts and more. One of the many things we'll be examining is why these midterms with Senate control on the verge of flipping are getting such an abysmally low amount of coverage on the network evening newscasts.

BARTIROMO: You cannot find any information about the midterms on any of the major news networks, Howie. It's extraordinary. If you want to find out what's going on in midterms, you have to watch FOX News channel.

KURTZ: You can get it in newspapers, I think. But you're right.  It's one of the things we'll talk about is that people are turned off to midterms or is it not rating or are some people not -- are some journalists not excited about these midterms because it seems to be going the Republicans' way?

BARTIROMO: Howie, thank you. We'll be there. We'll see you in about 20 minutes.

Has the 2014 race already set the tone for how the 2016 presidential election is going to go down?

Our panel will tackle that next on "Sunday Morning Futures." Back in a moment.  

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BARTIROMO: Welcome back to our panel, Tony Sayegh, Mary Kissel, Judith Miller.

Mary, you made a good point, you said that the 2016 election is hinging on what happens post-midterms.

Why is it so important to see GOP take the Senate if they are looking at 2016?

KISSEL: Because the GOP has to explain what it's for. They need to use the next two years to say here's where we stand on immigration, here's how jobs are actually created in a market economy. Here's why we need certain reforms to ObamaCare and to the tax code and to make it tangible for the average voter.

This election they have run against Obama is what Mitt Romney did back in 2012. Didn't work out so well for him. They also have to learn how to answer Democratic attacks.

If you look at Colorado, Cory Gardner has explained why the war on women is fiction and Colorado voters are responding but what the GOP hasn't done is they haven't explained why business is good and why entrepreneurship is good and why taking risk is good.

You look at a race like Georgia with Perdue and he's getting creamed.  He's getting Romneyized. The GOP has to change that narrative and they need to learn to do that over the next two years.

BARTIROMO: And they need to focus on income inequality and explain how to move the needle on income inequality --

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BARTIROMO: Absolutely. It is not income inequality. I'm so using the buzzword. But you're absolutely right. It's equal opportunity.

SAYEGH: And on the economy, I think Republicans are going to have a great argument to make. This president for six years has had it his way, trillion dollar stimulus, a hostile takeover of the healthcare system, controlled by government. He's raised spending. He's raised taxes. And what happened? Wages have gone down. Fewer jobs have been created.

People have to work two jobs to make the same wages and prices are going up. What you are making takes more of what you earn based on what you pay for. Electricity, utilities, groceries, that's why the middle class in America has been hurt the most by the president's administration and this is the opportunity to what Mary said.

Republicans have to affirmatively go out there and reclaim the fact that we're the party of the middle class American. The president does fine for Wall Street. He does fine for people who need dependency on government, which we respect because people do need to have a vibrant safety net.

But what about the people struggling to make it on their own in this country, who've been oppressed by this president's policies?

BARTIROMO: And you think they'll be able to do it? I mean, let's face it. Wednesday begins the campaign for 2016.

Will they be able to do it?

SAYEGH: Step by step. You start out with the energy independence, which will liberate potentially a billion dollars of new revenue automatically if you begin to do it the way we've been suggesting, Keystone Pipeline and other policies.

You take on immigration reform and show the fix to the ObamaCare law that we can do and radical tax reform that drops the top marginal rates.  Enough of this small ball on the margins. Drop the top marginal rate the way Jack Kemp, my old boss, and Ronald Reagan did and Senator Roth (ph).  And that's where you get, as John Kennedy called, the rising tide that lifts all boats in economic growth and tax revenue.

BARTIROMO: Judy?

MILLER: You know, I just think it will be a very hard road for the Republicans to hoe because they are so divided themselves and what makes you think they're going to be any more coherent and cohesive than in the past?

Lots of the races where they're in trouble it's because you have more than one Republican running, whether he calls himself a Tea Party candidate or an independent.

I think the Republicans, given where the Democratic Party is in terms of 27 percent of the Americans, only 27 percent think we're moving in the right direction. They should run away with this and they're not because they seem to be the party of the rich and the powerful and it's going to be very, very hard to change that.

KISSEL: Well, look, the Republican Party is one thing. There's also going to be a big debate on the Left with the Democrats. Are they going to move to the Senate or will we get a populist like Elizabeth Warren who's worse than President Obama and even more economically illiterate than we have than the guy in the White House right now.

BARTIROMO: Which is why Hillary Clinton made the comment that business does not create jobs.

KISSEL: I think she's a terrible candidate. I don't think she's a sure thing. She's not a natural politician. If she gets on the campaign trail, you're going to --

SAYEGH: And the question is going to be does Hillary Clinton have the gravitational force to overcome the fact that in about a year when we begin the presidential campaign in earnest, the president is still going to likely be at a 42 percent approval rating.

That's devastating to the people who run under the mantle of this party. I'm not so sure Hillary Clinton, while assessing this, is going to think it's as great an idea for her to take on the Obama --

KISSEL: I'm not sure she's competent.

Did you look at those remarks in Boston? It's like she was picking words out of the air. What are -- it's like a word scramble on your refrigerator. You just sort of throw words up there. Income inequality.  Big business. This isn't somebody who is fit to run the country.

MILLER: She's got more experience than anyone else.

KISSEL: Has she really? What has she accomplished? Nothing.

MILLER: Come on, we have to go through the whole -- ?

KISSEL: Really?

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KISSEL: Legislative accomplishment, foreign policy accomplishment?

She left the world in a far more dangerous place than it was even --

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MILLER: I want to worry about the fastest growing populations, Hispanic, Asian Americans, young people, all leaning Democratic and heavily so. I think Republicans will have their work cut out for them.

SAYEGH: And Judy is right. If we don't address it, we can address it. We've seen it even in this election. Hispanics are beginning to give the Republican Party a second look. They don't believe in this blanket amnesty that he president wants to put through executive order. They want more --

KISSEL: They don't even vote on immigration. They care about education opportunity for their kids. Republicans should speak to them about that.

BARTIROMO: Hold that thought.

Even before we cast our votes, a key component of ObamaCare could be taken out by the Supreme Court, the federal exchanges.

Are they legal?

The panel takes on that as we look ahead on "Sunday Morning Futures" next.

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BARTIROMO: The Supreme Court could decide as early as tomorrow on whether to hear a Republican-backed appeal that questions the legality of federal exchanges under the Affordable Care Act. We're back with our panel, Tony Sayegh, Mary Kissel, Judith Miller.

Tony, what do you think about this, the Supreme Court decision?

SAYEGH: Well, it's a major issue because this is in the law. It's not as if this was somehow artificially generated as a complaint by Republicans. In the law, it says you can only distribute these tax credits and subsidies through the state exchanges. Thirty-six states have a federal exchange. That could be in direct conflict with what is in that law.

BARTIROMO: The states said, "Look, we don't want this." And so all of a sudden, they had...

SAYEGH: Many Democrat governors said "We don't want this, either."

BARTIROMO: Yeah, Democratic governors as well.

KISSEL: Look, the Obama administration has a habit of unilaterally rewriting the law. That's what the IRS did on -- on this particular issue. What is the White House going to argue, "Hey, Supreme Court, ignore the law; ignore that Jonathan Gruber, the architect of Obamacare, also reiterated this point, that the reason that they did this was to entice the states to create their own exchanges"?

It's very awkward for the administration. I think the Supreme Court has to read the text of the law and rule accordingly. And if they don't, it's going to look like the court has been politicized. I think that would be very damaging for the judiciary.

BARTIROMO: Well, I think it will be more awkward if they make that ruling before the election, before the midterms. Afterwards, I'm not so sure. It gives the administration some time to adjust.

But, speaking of the courts, this is an area where I think the Democrats really are worried. Because, if they lose control of the House and the Senate, then you have the president in a very limited -- has a very limited ability to appoint the people at the federal district level that he wants to appoint to determine the future of the country. That's what's at stake.

BARTIROMO: How -- how important is this for voters, the Supreme Court decision? I mean, unbelievable timing, two days before the election.

SAYEGH: The voters have already cast their verdict on Obamacare -- overwhelmingly unpopular. It gets more unpopular the more we learned about it. Remember the whole Nancy Pelosi thought that, once you got to know what's in it -- until you pass it, you don't know what's in it...

BARTIROMO: Yeah, exactly.

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SAYEGH: When people learn what's in it, particularly the fact that now we're even talking about making the employer mandate not part of the law, this is something that the Obama administration is now saying -- because they realize how unpopular the individual mandate is on the private side. So they're going to have a lot of problems with this issue on Election Day.

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KISSEL: But it also speaks to the incompetence of the management of the Obama administration. It's not just this issue, but look at all the other bureaucracies that have broken down over the years, from the IRS to the Secret Service to the V.A.

BARTIROMO: Yeah, exactly.

All right. Stay there. We want to come back with the one race to watch for this Election Day. We've got a whole host of runoffs, potentially. We're next, with that, on "Sunday Morning Futures." Stay with us.

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BARTIROMO: We're back with our panel. The one race to watch this Tuesday, Judith Miller?  

MILLER: Iowa. I'm going to side with Harry Reid, who calls it "the bellwether state." This, remember, is symbolically important to the Democrats. This is where Obama took it away from Hillary, so this is a key state to watch now.  

BARTIROMO: Wow. What do you think, Mary?

KISSEL: I might steal Tony's thunder here because New Hampshire is my race...

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... Scott Brown versus Jeanne Shaheen. This guy was down by more than 10 points this summer. I mean, he's coming in as a carpetbagger. Nobody was even looking at this race, and now it's neck and neck. I think, if he wins, it's a big night for the GOP.

BARTIROMO: What do you think, Tony?  

SAYEGH: I'll give you New Hampshire. I'll North Carolina...

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BARTIROMO: OK.

SAYEGH: ... on the Eastern Seaboard, one of the first races that we're going to know the conclusion of. If we have a Democrat losing in North Carolina, that is their only firewall to holding the majority in the Senate. That's the first domino that falls for the rest of Election Night.

BARTIROMO: All right. That is the bottom line. We're going to be watching all of this together. Thank you so much, panel. We loved having you today. Tony Sayegh, Mary Kissel, Judy Miller. We'll see you soon, guys. Thank you.

That will do it for "Sunday Morning Futures." I'm Maria Bartiromo. Thank you so much for being with us today. I'll be back tomorrow morning on "Opening Bell" at 9:00 a.m. Eastern on the Fox Business Network. Take a look where to find Fox Business Network on your cable network or your satellite provider, or go to "Channel Finder" at foxbusiness.com. "Media Buzz" with Howie Kurtz is up next. Have a good Sunday.

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