This is a rush transcript from "Special Report," October 22, 2010. This copy may not be in its final form and may be updated.


HARRY REID, SENATE MAJORITY LEADER, D-NEV.: We have fallen hard and people have been hurting. I understand that. And it doesn't give them come fort or solace for me to tell them, but for me, we'd be in a worldwide depression. They want to know what I have done for them.


BRET BAIER, HOST OF “SPECIAL REPORT”: Senate Majority Leader Harry Reid in an interview talking about the economy and voters and what he's done for the economy. We're going to talk about the President's campaign trips. Tonight, he is in Nevada for the majority leader. He is starting in Nevada. He will go next week to Minnesota and then Pennsylvania and then Connecticut and then Illinois, and then finish with Vice President Biden in Ohio.  There you get a sense of the map and what the house released so far. Of course that could change, but that’s the campaign schedule as it is right now. What does it tell us what if White House thinks about the races? We'll dig down into them.

We'll bring in our panel, Rich Lowry, editor of National Review, Kirsten Powers, columnist of the New York Post, and James Taranto of the Wall Street Journal editorial board.  Kirsten, let's start in Nevada. The Real Clear Politics average of polls has Sharron Angle up 0.4. Obviously this is essentially tied.  You heard the majority leader there in that interview. What about all that? How it factors in the race?

KIRSTEN POWERS, NEW YORK POST: We have to all look back to remember when everyone was claiming Sharron Angle would be so easy to beat.  Now they are neck and neck. So it says something about how weak Harry Reid actually is.  It's obvious that’s why Barack Obama going out there, to try to help him out, and also Dina Titus, who is running for a congressional seat there, who has a really tough race.  People that I talked to today said things that were concerning in making their case for him. They are saying they are looking at the "none of the above." There’s a choice on the ballot for none of the above. It's polling at five percent. Internal polls quite a bit higher.  They're saying look; we think you can get around 46 percent.  Then we have this, plus there’s nine, you know, other candidates in the race. They're hoping that all of that will come together and work to his advantage. That is the risky plan, though.

BAIER: James, did the comment in the interview hurt him?

JAMES TARANTO, WALL STREET JOURNAL: I don't know. People are beating up on Harry Reid for that. But you know what Harry Reid always makes me laugh. I call him the sad clown of a Senate majority leader. I think he’s a great depression cure.

BAIER: Rich?

RICH LOWRY, NATIONAL REVIEW: If you were dropped in from outer space and you just had to guess which of the candidates was a gaffe prone outsider who in America won a Senate primary and which was the majority leader of the United States Senate you would have no idea.

And I think ultimately the template for this race is New Jersey.  We had a very unpopular incumbent Jon Corzine dumped millions of dollars on his opponent Chris Christie, briefly went into a lead, but at the end of the day people didn't want John Corzine. And there was nothing he could do to win. I think Reid is in a similar spot.

BAIER: The President is going to Minnesota, for the governor’s race there, then onto Pennsylvania, there is a Senate race that has tightened. As you take  a look at the Real Clear Politics average of polls, it's pretty tight, it’s getting tighter, Pat Toomey, the Republican up 1.2 over Joe Sestak, the Democrat. Rich, what about this race, and the president's calculation?

LOWRY: Well, it's tightened considerably, mostly I think because the Democrats are beginning to come home. This is a state in where Democrats lead in registration by 1.2 million or something.  And Obama is going to Philadelphia. That media market is about 40 percent of the electorate typically. And it's where Democrats have to win big and get their vote out.

The Toomey people say they can afford to lose by nine points.  They are doing better than that. The early indications are from the absentee ballots that the African-American precincts aren't that ginned up.  The Rendell machine for the first time in a long time is not going to be going in Philadelphia. So Obama wants to get there to drive down Toomey’s numbers and drive up turnout.

BAIER: And the Republican governor candidate there, Corbett is doing pretty well in the polls, although that seems to be closing as well, Kirsten. But the White House thinks they can maybe build a firewall in Pennsylvania?

POWERS: Yes. They're doing that. I think you have to remember Pennsylvania is also important state in general. Rich is talking about the dynamics there, is something -- I think that the White House is talking about the fact that they are completely dependent on Philadelphia. When you start going out to the outside of the, where you have a lot of those old Hillary Clinton voters, they're not loving Democrats very much right now.

BAIER: James, an interesting stop on this trip is Connecticut.  And that Senate race if you talk to Democrats they feel confident that Richard Blumenthal will win. He is up 10.2 according to the average of polls over Republican Linda McMahon. What about this stop and why you the White House, the president is making it?

TARANTO: I'm fascinated by this. There is a governor's race in Connecticut which I believe is a little bit closer. There are a couple of close house seats including the fourth district including Bridgeport where the president is going to be speaking.

But still, Blumenthal has such a lead in that race it makes you wonder if either the Democrats see some vulnerability there that isn't showing up in these polls, or maybe there are so many places that President Obama can go without doing harm. He figures Connecticut is one of them.

BAIER: Does it factor in that the White House wants to go to places where they can say they won at the end of the day?

TARANTO: An assured race.

POWERS: I heard from people talking to today that people aren’t completely trusting the polls and they don't want to take anything for granted. That and what you said. He’s spending a lot of time in many blue states.

TARANTO: He campaigned in Delaware; a state which everyone says is loss for Republicans.

BAIER: And those media markets, some of them overlap.

Rich, let's finish up in Ohio. The President and Vice-President will be there. It seems like they should have a driver's license in Ohio. They’ve been there 18 or 19 times in the past 18 or 19 months. That Senate race has Rob Portman ahead 18.2 according to the Real Clear Politics average of polls over Lee Fisher, the Democrat.

LOWRY: That's a blow-out. Portman is a mainstream conservative.  They tried the anti-Bush message against him. It failed utterly. A year-and-a-half ago, Bush is gone, and it's not at the top of mind.

BAIER: But the governor's race has John Kasich up 5.4 according to the average over Red Strickland. That has closed and that is important for this White House.

LOWRY: Hugely important. Ohio obviously, center of the country, huge swing state in Presidential election. I think part of the reason that race is closer is just Ohio voters tend to give their governors two terms. It's just -- Ohio, political culture is very hard to get an incumbent out of there. That's what’s making Kasich's job tougher.

BAIER: And that's why so many visits, Kirsten, 2012?

POWERS: I think it's a combination. They think they have a shot to get that and they are concerned about 2012. I think Obama rightly should be very concerned about governors because we'll have redistricting coming up. We haven't even talked about the governors but Democrats are in bad shape on that.

BAIER: Quickly, James.

TARANTO: Also, Ohio and Pennsylvania have a lot of vulnerable Democrats in the House seats. Don't forget about that.

BAIER: You voted this week in our homepage at FOXnews.com/specialreport for our first topic in the Friday lightning round. The winner is coming up next.


BAIER: Back with our panel. Every week on FOXnews.com, the "Special Report" homepage, viewers vote on what topic we should discuss this in this, the Friday Lightning Round.

This week, drum roll, please -- healthcare. How would repeal work? It won with 40 percent of the vote. So thank you. That was a little late drum roll, by the way.


It's the delay. Panel, healthcare -- how would repeal of healthcare work? James?

TARANTO: Well it's going to be tricky for the Republicans even if they get the majority in a week and a half because clearly they are not going to repeal Obama-care out-right while Obama is still president. Some things are easy like getting rid of the 1099 requirement for paperwork for small businesses, even Barney Frank now said he's against that.

But I think they are going to have to do more than that to satisfy voters who are really upset about this. They will need to find some middle ground perhaps defunding it, perhaps repealing other portions that Obama wants but that are unpopular.

One other thing to watch by the way is the courts. This is constitutionally uncharted territory, this individual mandate. There’s never been a case before in which the government told people you have to buy a product from a private company. So it's possible it could be thrown out in court.

BAIER: That is probably the most realistic or quickest way it could unravel. Even if the wave is huge on Election Day, you still have from the veto from President Obama, and Republicans wouldn't be able to overcome that.

POWERS: And they still won't have 60 votes in the Senate and they won't have 67 to overcome veto. That is a false promise. It's sounds really good but not something they can do. Sure, they can find common ground on some things and maybe they could get to the point of malpractice reform. But in terms of repealing it, not only would they need a Republican president; they would need a lot more Senators.

BAIER: It's important to note, rich; a lot of the healthcare bill doesn't go into effect until 2014.

LOWRY: Right. This is a long fight. I think if the Republicans take the house, they will have a repeal built the first couple of weeks and pass it and die in the Senate. Even the smaller stuff, defunding is difficult, because President Obama would have to sign appropriations bill. He won't sign them if key things are defunded.

I do believe though that the judge down in Florida will strike down the individual mandate by the end of January. This is up for grabs, a big fight. It's a long running fight.

BAIER: Obviously a political football out there on the campaign.

Next topic, the big outside funder you hear a lot about. Is it the U.S. chamber of commerce? No. Is it Karl Rove's group? No. The top funder according to the Wall Street Journal is AFSCME, the union, the American Federation of State, County, and  Municipal Employees. Rich, what about this?

LOWRY: This is not particularly surprising. The main constituency group of the Democratic Party. You look at some of the key policies over the past two years, stimulus, healthcare, geared to the constituency group.

It's a perfect feedback loop. If you wonder where funds come from, that they are spending in the election, they come from the taxpayers. So you have policies that feed taxpayer money to the public sector and they turn around to tries to elect more Democrats.

BAIER: Kirsten, does this undercut what the president and vice president talked about it today, this outside group, the spooky influence from outside groups that they say Republicans are benefiting from seven to one, et cetera?

POWERS: Well, it undermines the idea of all the money flooding in and we're so helpless here because we don't have money. It doesn't undermine the message of we don't know where the money is coming from, because whatever you say about this, you know where the money is coming from. It's pretty transparent who is funding this ad.

It's not transparent when you have Americans for Clean Energy, and it's Exxon behind the ad, and we don't know. It's an argument for transparency, which is a completely separate argument.

BAIER: AFSCME doesn't have to list donors either.

TARANTO: The money is coming from us. We pay salaries for the government employees who pay their dues.

And Rich's metaphor of feedback loop is fine as far as it goes, but the metaphor is this is the monster that ate the economy.  I mean many states were on the verge of bankruptcy because of pension obligations that were entered into to satisfy the government unions. This is a very troubling part of our politics.

BAIER: NPR has come under siege as it never has before. It crashed the server nearly 7,000 comments after firing Juan Williams as news analyst. He’s now FOX News contributor in an expanded role. James, the fallout day two, here.

TARANTO: I think the big question is why is Nina Totenberg still working for NPR? We earlier in the show some of her greatest hits on the PBS show "Inside Washington." She is very opinionated and quite edgy.

They say news analysts like Juan aren't supposed to express their opinions. She's not even news analyst. She is a correspondent, reporter.  She's supposed to play it straight.  The reason, of course, is Juan is no conservative but he occasionally deviates from liberal orthodoxy in choice of the venue, our network, and some of what he says. Nina never deviates from the liberal orthodoxy.

BAIER: Kirsten?

POWERS: I think the bottom line is they don't like Fox. It has nothing to do with what Juan said or didn't say because, you're right, there are other people who go on news shows, expressing opinions, granted not as much as you see Nina Totenberg, but those type of opinions.

But they don't like Fox so they don't want Juan on Fox or Mara on Fox. I think they have to get over it, frankly.

BAIER: They said they are not going to take action against Nina Totenberg or Mara Liasson.

TARANTO: I think Mara has the safest job in journalism.


BAIER: Even though there is a call on the left, of course, Media Matters and other groups funded by George Soros.

LOWRY: That played into what happened with Juan as well. This is playing horribly out there. Even on "The View" there is a consensus, and when you lost "The View" you lost America clearly.


BAIER: Is that the barometer now?

LOWRY: Juan is a liberal that occasionally says heterodox things on Fox News. And this is why Kirsten will never have a job with NPR.

POWERS: Exactly right, yes.

And I think – they’ve harmed their brand by doing this because I think it’s now shining a light on things maybe they wouldn't like a light shined on. I am an NPR listener, I listen it to every day and I love it.  This should not be representative of how they behave.

BAIER: Does this move forward, James, about the pulling of funds, or trying to attack taxpayer funds, whatever and the percentage that NPR may get?

TARANTO: Perhaps. Although you try to figure out how much NPR is subsidized by whom and it gets very complication because it's structured as 501C3 and they get dues moneys from local stations. It's a big shell game.

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