Is the Far-Left Media Misleading America?

This is a RUSH transcript from "The O'Reilly Factor," August 9, 2011. This copy may not be in its final form and may be updated.

Watch "The O'Reilly Factor" weeknights at 8 p.m. and 11 p.m. ET!

BILL O'REILLY, HOST: In the "Back of the Book" segment tonight: If you really want to know what the left-wing cause du jour is, just call up our pal Barney Frank. On all things liberal, the congressman is the go-to guy.


REP. BARNEY FRANK, D-MASS.: I want America to be very strong and able to defend itself. But I don't want us to take on the job of policing every political dispute everywhere in the world. We could reduce our military spending by $250 billion a year -- $140 billion from the Iraq and Afghanistan wars and over $100 billion in Western Europe and Japan and other wealthy nations -- and bring that money home.


O'REILLY: Joining us now from Washington, Fox News analyst Charles Krauthammer. So Charles, a few weeks ago you and I kicked it around. I said the American left is harming itself beyond repair. You disagree. But here we have economic chaos. The left still not backing away from the social justice deal, as you just heard Barney Frank. Take the defense money away, but please, please, don't hurt Fannie Mae and Freddie Mac and income redistribution. And I'm saying to myself, you know, Americans are not going to buy this. They're not going to buy it.

CHARLES KRAUTHAMMER, FOX NEWS CONTRIBUTOR: Well, I mean, on the face of it, it's rather absurd. He's talking about saving all this money from Iraq. I don't know if he's been told but we're going to be out of Iraq in less than five months. As for Afghanistan, it's his party that criticized the Republicans for a decade saying Afghanistan is the good war, the real war, central front in the war on terror, and the Bush administration should have been spending blood and treasure there. So the Democrats get into office. Obama triples the number of troops. He triples the spending there. And our casualties, of course, have gone up as a result. And then you get Frank complaining about how much is being spent on Afghanistan. I think he ought to sit down and have a chat with his president.

Look, the liberals, the Democrats have been saying this for a century. Whenever you need the money, you take it away from the one essential function of government, which is national defense. And perhaps he also hasn't heard that the sainted John Kennedy, under him we spent half of the federal budget, 50 percent was on defense. Today it's less than 20 percent and falling. He wants to cut it in half. He mentioned Japan. That means essentially turning over the Pacific Rim to China. I'm not sure that's really good idea.

O'REILLY: Yes. But that's -- you're making my -- you're actually agreeing with me. So, be very, very careful. As you know…

KRAUTHAMMER: Occasionally, Bill…

O'REILLY: …your reputation will be ruined if you agree with me.

KRAUTHAMMER: But look, Bill, I have to acknowledge that occasionally you stumble into the truth.

O'REILLY: You and Bernie Goldberg, you know, the same mantra, "occasionally." I'm right. I know I'm right. And let me give you a fact that's very interesting. Tuesday night. Monday night. Monday night, after the stock market blew up. All right. It's Tuesday today. I'm delirious. Our ratings were enormous. Enormous. Because people came to watch "The Factor" because they knew we would tell them the truth about why the stock market went down 600 points, who was at fault and what was happening. The liberal networks -- particularly MSNBC, but also CNN -- got murdered. Nobody watched them. Way down from what they used to do. And I'm telling you, Americans, even liberal Americans, are saying, you know what? These people are misleading me. These left-wingers are not doing what's right for me and the country. That prevailing wisdom is starting to seep in big time, Charles.

KRAUTHAMMER: Well, I think you're right. I mean, liberalism today after what it's done in charge for the last two and a half years, two years of which it controlled the House, the Senate and the White House. After these two and a half years, it doesn't have a real good story to tell. Everything is collapsing all around them.

O'REILLY: No. It's a disaster. It's actually been four and a half years because they controlled two under Bush. The liberals did.

KRAUTHAMMER: Well, the presidency -- the presidency also helps. And that's a definitive. If you control all the branches of government and you screw up royally, as has happened, you don't have a good story to tell.

O'REILLY: And it would be even worse if the liberal media would level with the folks, because they cover for themselves, they cover for each other. I mean...

KRAUTHAMMER: I know that.

O'REILLY: What do you -- what do you think they're thinking? This is -- this is -- you're good at this though. This is conjecture and speculation.

KRAUTHAMMER: Flattery will get you everywhere.

O'REILLY: What do you -- what do you think the editors of The New York Times, NBC News, they threw all of their resources behind President Obama. Everything. He was the godsend. And now look what we have. What are they saying to themselves, Charles?

KRAUTHAMMER: Well, it's complicated. I think some of them are saying to themselves, "We just picked the wrong candidate. Maybe it should have been Hillary. It isn't that liberalism is wrong, but we just have a lousy leader, a guy who had no experience, a guy who was a flash in the pan. Gave a good speech but never ran a candy store." So that's one argument. The ideology is right, but the leadership is wrong.

The other argument is the one that Obama is giving, that you see in The Times, elsewhere, which is it is all the fault either of acts of God -- earthquakes, acts of Japan, of Europe, elsewhere -- or of course of those nasty, terrible Republicans, who held America hostage, held a gun to its head, etc. Using, incidentally, precisely the kind of uncivil language that Tucson, they had said, was supposed to abolish. So I think they have two stories.

O'REILLY: All right. But none of those stories, neither of those stories is washing. Nobody is buying either of them.

KRAUTHAMMER: And -- and I think if the election were held tomorrow, they would be destroyed. But it's not going to be held tomorrow.

O'REILLY: And you'd be president, and I'd be secretary of state. And that's the way it should be, Charles. All right. Thanks very much, as always.

Content and Programming Copyright 2011 Fox News Network, Inc. Copyright 2011 Roll Call, Inc. All materials herein are protected by United States copyright law and may not be reproduced, distributed, transmitted, displayed, published or broadcast without the prior written permission of Roll Call. You may not alter or remove any trademark, copyright or other notice from copies of the content.