This is a rush transcript from "On the Record," December 29, 2014. This copy may not be in its final form and may be updated.
KIMBERLY GUILFOYLE, 'ON THE RECORD' GUEST HOST: Well, President Obama has threatened to use his veto pen. The new Congress hasn't even been sworn in yet, but the president is gearing up to block the incoming GOP majority.
Listen to what he told NPR.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: There are going to be some areas where we disagree. And, you know, I haven't used the veto pen very often since I have been in office, partly because legislation that I objected to was typically blocked in the Senate, even after the House took over -- Republicans took over the House. Now, I suspect there are going to be some times where I have got to pull that pen out.
(END VIDEO CLIP)
GUILFOYLE: And Charles Krauthammer, author of "Things That Matter," joins us.
Charles, thanks for being on the program, going ON THE RECORD tonight.
Really wanted to --
CHARLES KRAUTHAMMER, FOX NEWS CONTRIBUTOR: My pleasure.
GUILFOYLE: -- hear what you who to say this evening about this. This is what the president is promising. Do you think he will act on it and is it a wise move?
KRAUTHAMMER: I think he will act on it. And I think the Republicans ought to say, "Bring it on, Mr. President." There is no better way for the GOP to position itself for the 2016 election than to show the country two things. One, that now that it controls the House and the Senate, and now that Harry Reid is not there as the blocking guard for the president -- that's the reason he didn't have to use the veto, he had Harry Reid. But with Harry Reid gone and Mitch McConnell running the Senate, they are able to enact agenda. They have an agenda. And they should be willing to pass whatever they can and to dare the president to go ahead and to veto.
Now, they can do stuff that they know the president will sign. The most obvious thing is trade negotiating authority. Harry Reid was holding it up because of the unions, because of many liberal Democrats. But presidents want negotiating authority. Republicans are pro-trade. They should do that, give the president a win and a victory. But then they should begin to work on stuff and challenge the president, Keystone Pipeline, tax reform, repealing the medical device tax, repealing the employer and individual mandates in health care reform. Let the president show where the party stands and let the country know that with a new president, a Republican president, this stuff, which is very popular, will be able to get through.
GUILFOYLE: I think you are so right. It really transcends the bridge between now and what's happened with the midterm elections and going forward to pave the path for 2016 so voters can make informed choices based on specific examples. Neither party should be afraid to define themselves. Where do you stand? And Mr. President where do you stand? Then the people decide, is this what we want more of in 2016? Do we want intractable problems or people work together and stand for the principles? Because, essentially, the Republicans have this unique opportunity in time to do something about it.
KRAUTHAMMER: And what's happened for the last several years is these stark choices never came to a head because whenever a bill would get through the House, a Republican agenda, say, on tax reform or something on entitlement reform or jobs programs, it would die a death in the Senate where it never would even get to a vote. So it never even made news. Well, now, it will.
GUILFOYLE: It's so true. I love the examples, the juxtapositions between choices. Who do you want to vote for? Who do you stand with? And if you don't take this opportunity, I think if you are in the GOP, to make this that moment that matters, that transcends, than people will say, well, maybe I wasted my vote. I put you in because you were going to do something different.
KRAUTHAMMER: Right. Right.
GUILFOYLE: You were going to make a change, a fundamental change in the way that the lives of American people are live, and there are specific examples that you mentioned that they can do so.
KRAUTHAMMER: There is a way to expose, for example, the Democratic Party's extreme environmentalism. Keystone Pipeline is only the tip of the iceberg, to mix metaphors. So I think that will show exactly how extreme Democrats are, if the president exercises the veto, as he seemed to signal he would in his last news conference. But there is a whole slew of regulation coming down the pipeline out of EPA, which will kill coal, heavily regulate the entire power industry, raise rates in a way that I think will be extremely unpopular. And what Republicans ought to do is to target every one of those and let it come to a head and let the country have a debate. That's the way it's supposed to work in a democracy. But the thing is it was all shrouded and hidden when Harry Reid would prevent any of this from seeing the light of day. Now, it's going to be seen.
GUILFOYLE: You are absolutely right. This is going to be great to watch. And hopefully, we can move forward as a country and take these unique opportunities and let people make the choices.
Charles, always a pleasure. Thank you.
KRAUTHAMMER: Pleasure to be here.