This is a rush transcript of "Special Report With Brit Hume" from November 15, 2007. This copy may not be in its final form and may be updated.


SEN HARRY REID, SENATE MAJORITY LEADER, D-NEV.: The marines can go until so metime in March, and the army can go until late in February. And those are very conservative figures.

I am confident that if we did not give them another penny, they could go for another six months.

ROBERT GATES, DEFENSE SECRETARY: The high degree of uncertainty on f unding for the war is immensely complicating this task and will have many real consequences for this department and for our men and women in uniform.


BRIT HUME, HOST: So what are these guys talking about? Well it is this — the Congress has passed and sent to the president something like a $470 billion Appropriations Bill to cover the Defense Department generally.

This war, however, in Iraq and Afghanistan, are being covered separately on separate funding measures, and the president has asked for something along the order of $200 billion for those, and he is not, apparently, going to get it.

They are passing pieces of it, which contain restrictions that he finds unacceptable, which can't even really pass the congress as a whole, and they are holding back the funds, Harry Reid arguing, and Nancy Pelosi as well, one presumes, that they can reprogram some of this other money and keep the whole thing going. Some thoughts on this whole controversy now from Fred Barnes, the executive editor of The Weekly Standard, Mara Liasson, national political correspondent of National Public Radio, and Mort Kondrake, the executive editor of Roll Call — FOX News contributors all.

Let's talk a little bit about this issue, where it is going, who it is effecting, and who is right in the argument over whether holding this money for now affects anything.

MORT KONDRAKE, EXECUTIVE EDITOR, ROLL CALL: It does affect things. The Pentagon can reprogrammed some money in order to keep the troops supplied for awhile without this bridge money being passed, but the, as Harry Reid even acknowledges, the money runs out, and the troops are in danger.

Basically what the Democrats are doing is playing chicken with the lives and well-being of our soldiers in the field, ultimately. And Bush already plans to do one of the things that's required in this, and that is to start redeploying troops.

HUME: One unit is already home, I think.

KONDRAKE: Right, exactly.

So the issue is over whether you set a goal of everybody out by the end of 2008. Even Hillary Clinton and Barack Obama acknowledged that all troops will not be out of Iraq by even the end of their first term, they're not even saying.

So this is more extreme than even with the Democratic presidential candidates are saying. And I believe Dana Perino is exactly right —

HUME: White House spokesman.

KONDRAKE: White House spokesman — that the Democrats were going to drop this whole matter. Then Moveon.org and Code Pink started blaring at them, and they decided that they had to revisit this thing again and impose more restrictions. And it is unconscionable, frankly.

MARA LIASSON, NATIONAL CORRESPONDENT, NATIONAL PUBLIC RADIO: I do think the Democrats are caught between their inability to actually stop the war — and they certainly have tried enough times, and we've established the fact that they do not have the votes to do that — and the desire of their base, which is unhappy.

And one of the reasons the congress is so unpopular is because the Democratic Congress has lost a lot of support among liberal, antiwar voters who thought they were elected to end the war.

HUME: We have a couple poll numbers that are relevant to what you're saying, Mara. This Fox News opinion dynamics poll on the congress' job approval shows that it's virtually unchanged since less than a month ago. The disapproval number appears to have kicked up.

Let's look at this on the troop surge, which a lot of people were very skeptical of for a long time. Back in September you had a small plurality saying that it had led to improvements, with fully 45 percent saying it made no difference.

Look at now — 59 to 32 improvement over not made a difference. So public opinion on that appears to be shifting.

I wonder, Fred, if the political hazards that the Democrats face here- -and, obviously they are caught between the fact that the left does not want them to give an inch on this, and that public opinion may be shifting on whether the war is going better — that they may be it in real trouble here politically.

FRED BARNES, EXECUTIVE EDITOR, WEEKLY STANDARD: I think they are in real trouble.

I happened to be at the lunch three or four weeks ago when Nancy Pelosi announced that they would not have any more Iraq votes. They had tried, but those horrible Republicans had blocked them, and they were going to move onto other issues.

And now they're back again. They've had their chain jerked by some of the lefties in their party, and they responded.

Historically, though, let's just remember one thing. In the 2000 election, Democrats did not run on a promise of ending the war in Iraq.

HUME: In 2004?

BARNES: No, they never ran on that in 2006. They were critical of the war. They never said they would "Vote for us, we will end the war in Iraq."

LIASSON: Plenty of Democratic candidates did say that.

BARNES: I do not think many did at all, and, certainly, none of Rob Emanuel's favorites, all these moderates.

Some of the Democrats, including Nancy Pelosi, are in a state of total denial. They pretend that the civil war is still going on in Iraq full speed — of course it is not. They pretend that Al Qaeda is still a huge force there — they have practically been defeated. Al Qaeda has no strongholds anywhere in Iraq anymore.

It still exists, and they can still kill —

HUME: So what are the political consequences of this? How is it going to play out?

BARNES: The political consequence is, if the progress continues, and we are a year from now when the election comes up, and Democrats are still pretending like the war, as Harry Reid said six months ago, is lost, they will have no credibility whatsoever.

HUME: Do you agree with that, Mara? Do you think that is a danger for them?

LIASSON: I don't know. I think if things really changed, and these improvements continue to grow, it could be a problem. But I think the Democrats have plenty of time to adjust.

KONDRAKE: I agree with that. There is a long way to go. There has to be some political progress on the ground, or else the public will be turned off to this. But if there is, the Democrats are in bad shape.

HUME: Next up with the panel, will illegal immigration be the wedge issue for presidential candidates this year? More with the all-stars in a moment.


HUME: The flap over driver's licenses for illegal aliens, which was proposed in New York, has revived the immigration issue, principally so far in the Democratic Party, although Republicans are talking about it too. So we are going to talk about how much of an issue it will be. But before we do that, Mr. Kondrake has a statement to those who heard and were offended by what he said last night about the fair tax. Mort, the floor is yours.

KONDRAKE: I said that the fair tax was regressive, but doing a little research, I discovered that there is a rebate built into it for people. So it is not regressive. There is a lot more wrong with it, but we won't get into that now. Let's get on to immigration.

HUME: That may work from your fair tax community, but I have a feeling they would like to hear more from all of us about it, and we will do that at some point.

All right, what about this issue. There are those who are saying — even David Broder, our esteemed senior colleague in covering politics — that it is one of what he calls the icebergs that may confront Democrats this year. That is an issue that can be used very well against them.

What do you think, Fred?

BARNES: I think it could. Here's the problem for Democrats who are pushing things like giving driver's licenses for illegal immigrants and in- state tuition, and things like that — they are giving — these are a reward. They are a benefit for people who are not here illegally.

If you want that, this is why comprehensive bill is so important. If you want to achieve those things, then you have to give conservatives or others who oppose these benefits something as well.

That was the genius — I do not know, "genius" may be the wrong word — about the comprehensive bill earlier this year.

HUME: About the enforcement of the borders —

BARNES: It failed miserably. But the idea is other people who are critical of illegal immigrants, they get something. And those who want illegal immigrants here and had to be made citizens at some point, they get something. That is the way it works.

HUME: How is it going to be as a political issue, Mara?

LIASSON: Are you talking about in the general election? In some places, it can help Republicans. I think as a general wedge issue for a general election, I think it will be a little bit more difficult.

HUME: Why is that?

LIASSON: I think that, first of all, Republicans have a problem with seeming to be anti-Hispanic, or anti-inclusive, or anti-immigrant in general. It is hard to walk that fine line.

On the other hand, the Democrats do have some trouble, too. That is why Hillary Clinton got tied up in knots.

HUME: But, Mara, look at New York state, arguably one of the two or three most liberal states in the country. The polling on this proposal by Eliot Spitzer was overwhelming — 70 percent of the people were against it.

LIASSON: On issues like that, it will be hard. And, as Fred said, when there is a specific issue like that about instate tuition or driver's licenses, then it can become a wedge issue.

If you are talking about the presidential race, which is going to be mostly talking about federal legislation, I do not think it will work as well for Republicans.

KONDRAKE: The danger is that Republicans up and down the line have decided that the Hispanic vote is lost, so why don't we ride this as hard as we can?

And using the "amnesty" word. The Democrats are all in favor of comprehensive immigration reform, and lots of Republicans yielding to their base as much as the Democrats do on the war issue to their base are screaming that everything is amnesty, and that the Democrats will let illegal immigrants run amok.

What the Democrats have to do is figure out how to get ahead of this and say we are in favor of tough enforcement, too, but that the only way to solve this —

HUME: But they're not, are they?

KONDRAKE: They should be. And if it takes building a fence, let's build a fence.


LIASSON: Senator Clinton had in trying to figure her way out of this tangled mess of whether she thought it was a good idea, is a metaphor for the Democratic Party.

BARNES: I agree with Mara — nationally it is not going to be a big issue nationally. We just had a Virginia election where it helped Republicans in a couple of places. And it can help some places, and just opposing illegal immigrants getting drivers' license, I think there is no downside for Republicans in playing that up.

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