This is a rush transcript from "The O'Reilly Factor," February 9, 2009. This copy may not be in its final form and may be updated.
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BILL O'REILLY, HOST: In the "Back of the Book" tonight, let's bring in Governor Mitt Romney from San Diego, where he watched Obama's press conference.
Did you learn anything? I'm asking this to everybody. Did you learn anything, Governor?
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MITT ROMNEY, FORMER MASSACHUSETTS GOVERNOR: Well, I learned that there's a very great rhetorical benefit in being able to set up straw men, like the one you just showed, and then knock them down.
Dealing with the real problems associated with Barack Obama's stimulus plan was not something which he was prepared to do, and you know, you understand why he's doing what he is doing. He's had a pretty tough couple of weeks here.
O'REILLY: But let's...
ROMNEY: The stimulus plan, he let get away from him with Pelosi and Reid running it. Afghanistan and Iran looked tougher than he thought. He put out overtures to Iran and to Russia, and they both bit his hand. So he's doing what he does best, which is speaking, and I thought he did a fine job.
O'REILLY: OK. But let's walk through it now. Barack Obama to me believes that this $800 billion package is going to work because he's staking everything on it. There's no wiggle room for him. OK? If it doesn't work, it's a disaster for him. All right. So he believes it.
Why he believes it, I'm not sure, because I'm not that astute in economics. You're a business guy, all right. So you've got to put yourself in Obama's shoes now. You're a Republican, but you've got to put yourself in his shoes. Why does he believe it's going to work?
ROMNEY: Well, he has to believe it's going to work, and he's spending an awful lot of money hoping, against all hope, that he'll be able to get the economy going again. And, of course, the economy will at some point right itself on its own accord.
But he's right to try and push the stimulus plan, in my view. But he — instead of spending money on a whole host of long-range programs that don't create jobs, he should have said, "Look, let's spend $450 billion or so, and let's use that money to do two things: one, reduce taxes on a permanent basis for middle income Americans, and No. 2, spend money on urgent priorities of our nation and not on things that are going to do anything other than create jobs. Jobs, jobs, jobs, that's what it's about."
Unfortunately, by letting Nancy Pelosi and Harry Reid put this bill together, they've come up with something which is not going to work as effectively as if they would have done what, frankly, what John McCain proposed. He put out a bill, a $400+ billion bill, to get the economy going. He was voted down on purely partisan lines, and it had at its centerpiece a middle-class tax cut and spending on urgent priorities.
O'REILLY: But Obama is giving the middle class a tax cut, and he actually is sending them $1,000 in the mail and giving them tax credits on buying cars, on mortgage and home acquisitions. He's doing all of that.
What I can't ascertain with any kind of accuracy is how quickly the economy is going to stop disintegrating. I don't know that, and I don't think anybody knows it, Governor. I don't think you know it. Anybody but the deity. That's probably it. Because once they pass this bill, it's going to take time to get this stuff in motion. It's going to take time for this stuff to flow around, and I mean, anything could happen in the next six months. Am I wrong?
ROMNEY: Well, no, you're right, and actually, we have some pretty good evidence about what works and what doesn't, because it was just about a year ago that a stimulus package was put in place. Money was sent out to the American taxpayers with the expectation...
O'REILLY: And it didn't work.
ROMNEY: ...that that would get the economy going again. It did not work.
O'REILLY: No.
ROMNEY: And that's why when Barack Obama is saying he's giving us a tax cut, Republicans are saying, "No, no, no. That's a check in the mail." It's a nice thing. Everybody likes them, but that's not a tax cut.
Eliminating payroll taxes, for instance, for some class of individuals or reducing them, or reducing the tax rate for middle-income Americans, that's a tax cut, and that would have had a bigger effect on getting the economy going. That's what Republicans have been arguing. Let's do what's necessary and proven to get the economy...
O'REILLY: All right. That's always the argument. That's always — the smaller government, give the folks back more money. Let the folks, other then the larger government. Let the government, you know, target things and this and that.
All right. Now, I think that most Republicans are going to sit it out, saying, "Look, if it works, he's in for eight years. If it doesn't, we come back." I think that's the mentality in Washington today.
ROMNEY: You know, I think Republicans are devoted to doing in this instance what is absolutely the right thing for the country.
O'REILLY: But they're going to lose.
ROMNEY: I don't think they're right in saying — you know, I don't think they're focused on winning or losing. I think we, as a party, are focused on doing what's right for America.
Barack Obama, you're right, is sending out billions of dollars to American taxpayers. And we're saying, look, that's a wonderful thing to do, but give it to them in the form of a tax reduction...
O'REILLY: Right.
ROMNEY: ...because that has a bigger proven impact on creating jobs. Likewise on your spending. Don't spend all this money on new programs that will take years and years to get underway. Let's get the jobs going now.
O'REILLY: All right, Governor. Thanks very much for taking the time.
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