Make or break states?

This is a rush transcript from "Journal Editorial Report," February 25, 2012. This copy may not be in its final form and may be updated.

PAUL GIGOT, FOX HOST: This week on the "Journal Editorial Report," the Republican presidential candidates square off ahead of key contests in Arizona and Michigan. Who is up, who is down, and who has the momentum going forward?

Plus, social issues and the Santorum surge. They've helped propel him to the top of the Republican field, but could they hurt the party in the fall campaign?

And Mitt Romney shakes up the tax reform debate. Could his new plan be a game changer in the primary fight and beyond?

Welcome to the "Journal Editorial Report". I'm Paul Gigot.

With polls tightening ahead of next week's contest in Michigan and Arizona frontrunners, Mitt Romney and Rick Santorum, squared off in the primary's 20th presidential debate, trading jabs on everything from Romney care to earmarks.


RICK SANTORUM, R - PRESIDENTIAL CANDIDATE: So the idea that somehow earmarks during the time that I was in Congress were this thing that drove up spending in Washington D.C., if you actually look at it, as I've said before, as a percentage GDP, the debt went down. What happened is there was abuse.

MITT ROMNEY, R - PRESIDENTIAL CANDIDATE: While I was fighting to save the Olympics, you were fighting to save the bridge to nowhere.


GIGOT: Joining the panel this week, Wall Street Journal columnist and deputy editor, Dan Henninger; Political Diary editor, Jason Riley; assistant editorial page editor, James Freeman; and Washington columnist, Kim Strassel.

Kim, one of the big stories, Romney has been attacking Rick Santorum on his Senate voting record. He was a two-term Senator from Pennsylvania. How big of a vulnerability is that record?

KIM STRASSEL, WASHINGTON COLUMNIST: It's a big one. One of the realities, Paul, a lot of the House members and Senators do not go on and win presidential nominations, and it's because they have those records. What Mr. Romney has been doing very effectively is taking those 16 years of votes that Mr. Santorum has, and using it to undermine his argument he's the real conservative in this race, instead, painting him as a Bush-era big spender. And Mr. Santorum didn't necessarily need to in the debate to disabuse voters of the idea.

GIGOT: Jason?

JASON RILEY, POLITICAL DIARY EDITOR: It's a very smart strategy on the part of Romney. Rick Santorum was in the leadership, and the Senate, probably regrets it now, but he was in the leadership. And he does bear some responsibility for that spending. And the Romney campaign determined that part of the Santorum surge is fueled by the Tea Party, which cares about spending and earmarks, and the attacks have been effective.

GIGOT: What about his argument on earmarks, for example, it's right for Congress to assert itself. It has the power of the purse after all. Rather than let the president just say, I'm going to dictate policy, he's saying sometimes we have to overturn the president's priorities because he's wrong.

RILEY: He's right about that, and he's also right about just not being where the money is, which entitlement is spending.

PAUL: OK, but then why does that --


RILEY: It's a symbolic issue.

PAUL: Symbolic in what sense?

DAN HENNINGER, COLUMNIST & DEPUTY EDITOR: But the point is, you guys are making a better argument in his defense than he made in his defense.


In other words, I was struck that a professional politician like Rick Santorum wasn't better prepared for an obvious attack that was going to come on earmarks and No Child Left Behind, I took one for the team. And Rick Santorum has a reputation for winging it, and he winged it that night, and he got damaged as a result.

GIGOT: I would say, James, another point is he sounded like a Congressional-- a member of Congress and he's running for the office of the president executive. He when you talk about the legislative process and Title IX and 1020 and Title 30 and 40, people, their eyes glazed over, and say, aha, I get it, a legislator.



A lot of legislative language he didn't need in there. But I actually thought he did better than most people thought. In terms of, yes, he acknowledged he was a distributor of earmarks, but I think he showed that Mr. Romney was seeker and an acceptor of earmarks. Might have neutralized that.

But I think the point is for Tea Partiers looking at this, the choice is basically Santorum or Romney. Santorum, you had in the Senate and house, a reliable vote to cut taxes and a pretty good spending record at least in the context of Republicans in the Senate. Better than most of them.

GIGOT: Kim, what is this debate over Santorum's votes? Tell us about what the Republican primary voters think of the Bush record. Those Santorum votes taken were when President George W. Bush was president, and often on his agenda. And Romney was attacking him on No Child Left Behind, or I guess Ron Paul was attacking him on that. He's vulnerable to me, seems to me, Romney thinks he's vulnerable on the Bush agenda.

STRASSEL: This has been a really fascinating turn of events, Paul, which is somehow it's become very toxic to have been a congressional member during the middle and end Bush years. This was when they were thrown out of Congress in 2006 and an incredible feeling among voters out there that they had lost their vision for why they'd gone to Washington, forgot about reforming, and had become all about earmarks and spending. This is why Mr. Santorum is so vulnerable on this issue.

And it was cause of a lot of the Tea Party's angst. And the rise of the Tea Party is actually cleaning house within the GOP. So you don't want to be shed in that regard.

FREEMAN: But you're making a judgment on Santorum versus the alternative. So, to make the judgment that Santorum is unacceptable, you have to say that if Mitt Romney had been in the Congress at that time, he would have been the hard-core Tea Party guy. And I think his record in Massachusetts doesn't lead to you that conclusion.

GIGOT: All right, let's look at another exchange on that record in Massachusetts.


ROMNEY: Arlen Specter, the pro choice Senator of Pennsylvania that you supported and endorsed in a race over Pat Toomey, he voted for Obamacare. If you had not supported him, if we had said no to Arlen Specter we would not have Obamacare.


ROMNEY: So don't look at me. Take a look in the mirror.

SANTORUM: OK, governor, let's get this straight. First off, number one, you funded Romneycare through federal tax dollars through Medicaid.


SANTORUM: The bottom line is, what you did, was you used federal dollars to fund a government takeover of health care in Massachusetts. And then Barack Obama used it as a model for taking over this health care system in America. Why I supported Arlen Specter.


GIGOT: That's the only real punch that got thrown on Romneycare. Why so little, since it was such a strength for Santorum in previous debates?

HENNINGER: Well, that's true. I think what we've done now has proven conclusively both Rick Santorum and Mitt Romney completely violated their conservative principles.


And on that basis, do not deserve the support of any conservative voters.


So, I think now we're left with what? Ron Paul?


GIGOT: Well --

HENNINGER: We're talking ourselves totally out of the election.

GIGOT: But Santorum was on defense for most of the debate. And he's been on debate. And Romney is pounding him in the airwaves, on the --


HENNINGER: It's totally reductive in the campaign.

RILEY: Rick Santorum spent much of the night explaining why he voted for things he doesn't believe in. It as a big thing for Romney. The latest in NBC polls shows him up, Romney up in Michigan by 2 points, within the margin of error. But he had been down in more recent polls. So, I think right now, Mitt Romney has the momentum in Michigan.

GIGOT: All right, Newt Gingrich by all accounts, Dan, did pretty well in the debate. Does he have a chance for a third resurrection?

HENNINGER: I doubt it. I have to say I kind of admire him for trying to stay positive and focusing on the substance of the case against Barack Obama, because ultimately, these others, when they're finished slashing one another, are going to have to make a case against the president, and I admire Gingrich for trying to keep that subject on the table.

GIGOT: Not going to win Michigan or Arizona, but he's got to win Georgia, Tennessee, the following week if he wants to stay in this.

When we come back, social issues and the Santorum surge. His conservative stance helped propel him to the top of the Republican primary pack, but would they hurt him in a general election? We'll have a little debate ahead.



SANTORUM: There are bigger problems at stake in America and someone is going to go out there, I will, and talk about the things. And you know what? Here is the difference. The left gets all upset, oh, look it I'm talking about the things. Here's the difference between me and the left, and they don't get this, just because I'm talking about it doesn't mean I want a government program to fix it. That's what they do. That's not what we do.



GIGOT: That was Rick Santorum at this week's debate, responding to a question on contraception. Throughout his career, the former Pennsylvania Senator has been outspoken on that controversial topic and others, including gay marriage and the role of women in the work force. Would his stands on these social issues help or hurt him in a general election campaign?

Jason, what do you think, help or hurt him in a general?

RILEY: That's a nice applause line we've heard. Keep them separate. He said in the past when he led the JFK speech on separation of church and state, he almost, quote, "threw up." The question is, will Independent voters, swing voters believe him when he says these things.

Paul, Rick Santorum does well among people who vote Republican, no matter who the nominee is. The problem is those people are probably not going to decide the election in the fall. And the question is, who does best among the swing voters, among women and Independent voters? That's where the question is in terms of Rick Santorum's viability.

GIGOT: But his views on gay marriage, for example, are the same as the view that Barack Obama has, and views on abortion --


RILEY: It's social conservativism per se. It's how he wears it.

GIGOT: What is it then? What do you mean by --


RILEY: His views are not that different from George W. Bush, for example.

GIGOT: That he's almost indistinguishable.

RILEY: He's much more up front and in your face about these things. Some things he said about gay relations and comparing them to bestiality, the things he said about women's role in the workplace, contraceptives. Paul, Republican women -- or Republicans, I should say, do well with married women. Contraception is a normal part of married women's lives today. And the idea that he's out there yammering on about it, I don't think sits well with them.

GIGOT: But if the administration picks a fight forcing the Catholics church to pay for contraception, don't Republicans need to speak up against that?

FREEMAN: Right, and I think when he was making reference to the Kennedy speech, he is among those who think that religion out to be allowed in the public square and, specifically, the issue on the table. It's not just contraception of course, it's sterilization, and even more, it's a question of whether the government can dictate to religious organizations, extending that it violates their conscience. And I think in that, he's not only very much in the traditional American mainstream, but most voters would say, they don't like Obamacare. They don't like government dictating all of these kinds of decisions.

GIGOT: What about Jason's point about presentation and tone? That there's a kind of censorious or moralizing tone to the way that Santorum presents them that is off putting, even to traditionalist voters in some ways, particularly women.

FREEMAN: I think he should focus more time on economics. A lot of the speeches are economics. He tends to respond to social issues questions when asked. He's not afraid of them. But --


GIGOT: But that's the way that he feels right here.

FREEMAN: He does feel it. But my point, I think he has a great story to tell about economics that I think a lot of women voters would like. But even when he does address the social issues, this idea that it's a big turnoff to American voters is largely -- it's an idea that has more currency in the media circles that we travel in than among actual voters. The Romney -- if the argument for Romney is that he's going to reduce the margin of defeat in New York and California, that's not really relevant. The issue is, for voters in Midwest swing states, Virginia, is it going to turn them off? I think history says, no, social conservativism doesn't turn them off.

GIGOT: Let's get our conservative mother in here, Kim.


What about -- where do you come down on this?

STRASSEL: Well, this is about delivery. Look, Republicans do best when they are talking about their own values, but when they are saying, we're not going to let liberals impose their viewpoints on Americans, so we don't want the federal government telling the Catholic Church what it has to pay for. We don't want courts imposing gay marriage. We will protect your liberty in that regard. Where they get this trouble is when they begin telling Americans how to live their lives themselves, and when he they leave Americans with the impression they might actually impose their own world view on Americans. And this is one of the -- Rick Santorum's liabilities in this race.

GIGOT: You know, that Jeff Bell, the social thinker has argued that since 1968 when social issues came to the fore in national politics, with the Vietnam War and Cultural Revolution, all of that, the Republicans have done much better. Seven of 11 presidential races, they've won, whereas they lost most of them before that in the pre-cultural issues era. Doesn't he have a point?

HENNINGER: He has a point. But all presidential elections are not alike. This presidential election is about Barack Obama's stewardship of the American economy. It's not about this stuff. And the Republican candidate who can best criticize Obama's stewardship for the economy and offer an alternative is the one who's going to win.

FREEMAN: And I think beyond that, I think you realize when you look at Santorum, if he's saying parents ought to spend more time with their kids, and he said this, that moms and dads spend more time with their kids, he's not regulating it. At the end of the day, you've got to ask yourself, what allows you more freedom to live the life you want to live? The Barack Obama plan, 24 percent of GDP consumed by governor, or Santorum, at 18 percent? And I think people who aren't religious will comes to the Santorum --


GIGOT: James, last word, I'm afraid.

When we come back, Mitt Romney's tax reboot. His new plan has the potential to be a game changer, but can he sell it without apologizing for it?


GIGOT: Mitt Romney jumped head first into the tax reform debate this week, unveiling a new plan that includes a 20 percent across-the-board cut in income tax rate. How does it stack up against the plans of his rivals and can he sell it without apologizing for it?

Dan, you've been urging him to get in the tax reform he debate. He's done it. Will it help him?

HENNINGER: Very good think. I think it will help him enormously. It distinguishes him from Barack Obama on precisely the issue that is at center of this election, which is one's idea of the economy. The new plan, which he proposed a 20 percent across-the-board tax cut, allows Mitt Romney to start talking about the appropriate way to use the tax system and capital, and productivity in the United States. Obama is proposing by and large tax increases, which reflect an entirely different view of the way the economy should function in the country. So, it really gives Romney a springboard and a platform.

GIGOT: Why did he do it? Why change?

FREEMAN: I think he felt he had to hold off the Santorum challenge, to --

GIGOT: To appeal to conservative voters?

FREEMAN: -- to appeal to conservative voters. but the good news for him is, for Mitt Romney, is that if he wins this nomination, he now has an argument to make this fall, other than look at my biography, I'm a smart business guy, I'll take care of everything. But it's great for the country to have economic growth now front and center in the campaign debate.

GIGOT: An advisor -- a campaign advisor told us this week, he also did it because Romney was persuaded that half of all business income doesn't come from corporations. It comes from small businesses, sole proprietorships, partnerships, sub-chapters S companies that report to the individual tax base. And Obama is proposing to raise taxes on those businesses up to 41 percent.


GIGOT: -- when current tax rates expire. Big contrast between 41 and --


RILEY: Also Obama's proposing to essentially raise taxes on the U.S. multinationals, which won't help. One thing I am he' worried about, Paul, here, is how strongly, Romney's going to run on this tax, when he barely mentioned it at the debate the other night. That's not a good sign.

GIGOT: Really, you're not convinced of this. Isn't he committed now?


GIGOT: Once you propose is, if you don't -- if you don't defend it, you look silly.

FREEMAN: Yes, there's no turning back, but he did say the day after he proposed it or maybe it was the same day, in response to questions about does this favor the rich. He said don't worry, we'll have the deductions and they're not going to get a break. A lower rate system, a flatter system with lower deductions is great, but if this is his opening bid -- there's a concern that you don't want him giving away too much. If he does feel he has to apologize for anything that might help someone who successful.

GIGOT: You're saying he can't be a guilty capitalist and win this argument.

FREEMAN: That's right. He's got to push it hard. And I think that's one thing now for the Republican primary vote, to decide, is how much conviction is there behind this plan, which is a good one?

GIGOT: Kim, how does it compare to Santorum's plan? Will it help him, vis a vis, Santorum, among Republican primary votes?

STRASSEL: It's remarkable. Mitt Romney has gone from the laggard of the field to getting to the front. This is a good plan. One thing that's nice about it, from a purely economic standpoint, much more clean than the Santorum plan, which also does lower rates to the same level, but has a lot of social and industrial policy in it, in that it has this zero percent manufacturing rate and it also has, you know, tripling the child tax credit and it adds to the deductions. So in that regard, the Romney plan is cleaner, and he should be able to pop that up on the field.

FREEMAN: It's not as good as Gingrich and Santorum in terms of the amount of resources the government will be taking from the private economy.

GIGOT: Gingrich proposes a 15 percent.

FREEMAN: Gingrich -- I would have to say the most pro growth tax rate out there. Santorum has this weird thing where he's favoring manufacturing, not good, but cuts the corporate rate for everybody else in half and cuts individual rates, and government taking 18 percent of GDP versus ultimately Romney is talking about getting the 20 percent. So not a small government plan, but definitely with Romney a move towards --


GIGOT: I give Romney credit for not favoring certain industries. It's easy to be -- to favor industrial policy. It's the thought of the hour. It's what Obama does and Santorum wants to do, and he says no.

HENNINGER: Yes, and I think it puts all three candidates on the right side of the tax debate. And indeed serious bipartisan people, Simpson Bowles, they all want to go in this direction. Obama is the outlier.

GIGOT: OK, we have to take one more break. When we come back, our "Hits and Misses" of the week.


GIGOT: Time now for our "Hits and Misses" of the week.

Dan, first to you.

HENNINGER: The first hit to the Chicago school board. It might be a miracle. The Chicago school board voted Wednesday to close five schools, fire the teachers at 10 schools and allow them to reapply. And six schools are going to be turned over to the Academy for Urban School Leadership, a nonprofit that's had a lot of success. This is a huge achievement for the rookie mayor, Rahm Emanuel, who was Barack Obama's former chief of staff. They did it over the opposition of the unions. It a very positive sign for school reform.

GIGOT: Terrific.


RILEY: A hit to the Supreme Court, agreeing this week to hear a racial preferences case of involving the University of Texas. These policies, Paul, make a mockery of the Constitution's equal protection clause, a mockery of the 1964 Civil Rights Act, which bans discrimination. Let's hope the justices put it end to it.

GIGOT: All right.


FREEMAN: This is a miss to John Corzine, former New Jersey Democratic governor and former CEO of the brokerage of M.F. Global. Here we are four months after the bankruptcy, customers have not told where their $1.6 billion are. And now, we hear that after Mr. Corzine testified in December that an employee told him it was OK to send money to a London bank account, because it wasn't customer funds. That same employee apparently wouldn't assure other people of that fact. So a lot of questions still remaining. Mr. Corzine should answer.

GIGOT: Jason, what's your betting on the Supreme Court case? Are they going to overturn racial preferences?

RILEY: I think a majority of the court will limit them significantly, if not overturn them altogether.


Remember, if you have your own "Hit or Miss," send it to us at and visit us on the web at

That's it for this week's edition of the "Journal Editorial Report". Thanks to my panel and especially to you for watching. I'm Paul Gigot. Hope to see you right here next week.

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