This is a rush transcript of "Special Report With Bret Baier" from February 4, 2010. This copy may not be in its final form and may be updated.


GARY LOCKE, COMMERCE SECRETARY: We simply must elevate exports as a key part of our economic recovery efforts.

PRESIDENT OBAMA: We will double our exports over the next five years, an increase that will support 2 million jobs in America. We will strengthen our trade relations in Asia and with key partners like South Korea and Panama and Columbia.

TERRY MILLER, INTERNATIONAL TRADE EXPERT: It was nice that the president chose to mention in his State of the Union address those three countries with which we have pending trade agreements, but he didn't say let's ratify them, let's get on with it.


BRET BAIER, "SPECIAL REPORT" HOST: There you see some of the debate about the president pushing for exports to double in five years but not really pushing these free trade agreements, South Korea, Colombia, and Panama, that are still on the table.

The commerce secretary today delivering a speech, and he didn't mention them, any of them, until he was asked a question about them. What about all of this? Let's bring our panel, Fred Barnes, executive editor of The Weekly Standard, Mara Liasson, national political correspondent of National Public Radio, and we welcome Tucker Carlson, editor of the TheDailyCaller.com. Tucker, let's start with you. What about, is it possible that these free trade agreements are going to hang out there? Is that what you think?

TUCKER CARLSON, FOX NEWS CONTRIBUTOR: I think Obama would get a lot out of pushing them, particularly the Colombia agreement. You are not going to double our exports by opening markets abroad. In the case of Colombia, there are a lot of compelling strategic regions to do that there. It is our ally in a region where we have few allies against Venezuela.

And I think now could be the moment. It's not like globalization is going to do more damage to American manufacturing. The damage is done. You could make that case, and moreover private sector unions are less powerful than they have ever been. I think he could push it and I think he could get it and I think it would be wise.

BAIER: Mara, he has problems on the left with trade agreements.

MARA LIASSON, NATIONAL POLITICAL CORRESPONDENT, NATIONAL PUBLIC RADIO: The biggest opposition to these free trade agreements have been in the president's own party. He certainly understands that. He did shift his rhetoric after campaign during which he talked about even renegotiating NAFTA.

But since then he has become more of a free trader. He did mention it during the State of the Union address. When I heard him say that, I remember thinking is he asking for them to be ratified or not? It was unclear.

In subsequent times both Gary Locke secretary of commerce, and secretary of the treasury has said yes he wants these trade agreements passed, but it would take a tremendous amount of political capital to push his own party to do.

Now he has, a lot of other problems to deal with. It remains to be seen how energetically he is going to push them.

I do think he makes the case correctly that in the time of economic recession, the worst thing to do is to put up trade barriers and the way to get out of a recession is to increase trade. Bill Clinton did do this. Bill Clinton made an alliance with the Republicans and passed NAFTA. You know, it has been done before. It just remains to be seen how hard he wants to push.

BAIER: Fred?

FRED BARNES, EXECUTIVE EDITOR, THE WEEKLY STANDARD: That was in 1993. And he was visible, he led, he brought in Bill Daily from Illinois to help run the operation. Bill Clinton had a war room. And he still lost a majority of Democrats, but he got a lot of Republicans.

Is Barack Obama willing to be public, to be visible, to clash with union leaders, to go up against his liberal base? I don't think so. He is not going to do that. He has never done that.

And you say he is more of a free trader. Rhetorically he has become more of a free trader. In fact just mentioning these treaties that he is not urging that they be ratified really doesn't help much. That doesn't make him more of a free trader.

Look, what is the single thing that hurts American companies overseas and makes them less competitive? It's the tax race rate. It's a 35 percent corporate tax rate in the U.S. and the other industrial countries and big exporters average about 23 percent tax rate. So American products cost more and that hurts American exports a lot.

If you are serious about doubling exports, you have to reduce taxes.

BAIER: Tucker, what about pushing the unions? There are still some union folks out there saying card check has a shot of getting through Congress. Most people up here don't think it has a shot.

CARLSON: That's a delusional position. Those are the people that think cap and trade is about to become law.

BAIER: But how can he push the unions? He didn't push them very well in health care reform legislation negotiations.

CARLSON: He caved and hurt himself in a very embarrassing way. The cop out made him look like a fool and it may have hastened the end of that process.

I think Fred has got a point. I don't think there is real evidence he is a free trader. I don't think he showed a lot of political courage in the past six months. I think he would do this out of self-interest. Free trade actually might help the American economy in ways that are tangible and down to his benefit. Greater exports mean more jobs in America.

And so he has got to be thinking about the unemployment rate, which is forecast you know many years out to be high. He wants to do everything he can to lower that. This is not a bad way to do it.

BAIER: Mara, what about the jobs bill, where do we stand on this and the politics here?

LIASSON: That's going to be tough, too. Harry Reid says he wants to bring it up next week. They want to pass it. They have to pass a jobs bill. The House has already done it. But the Republicans again oppose a lot of what's in it and you are going to have to have 60 votes to pass that in the Senate, too.

BAIER: Because we call it a jobs bill but essentially it's another stimulus.

BARNES: It's just another stimulus, which is almost a complete failure. Obviously you can give money to state governments and they won't have to fire social workers and other people that work for state government, so you do save some jobs. But, you know, it's been almost a complete failure.

Look, there are ways to do it. You can do what Ronald Reagan did and what Jack Kennedy did and what Calvin Coolidge did, and that was cut taxes across the board and really unleash the American economy, the private sector. I have never seen a president more at odds with the private sector and what might work there. Government can't create jobs.

BAIER: Is he scoring points with this going out and answering these questions and really painting Republicans as being on obstructionists?

BARNES: I will tell you exactly what's wrong with that, Bret. We have had one year of President Obama, and people aren't looking for talk. We have heard a lot of talk from President Obama. You know, we saw him at the halftime of the Georgetown duke basketball game last Saturday. He is going to be interviewed at the Super bowl.

Talk — the problems of America, the ones that face Barack Obama, whether it's unemployment or stagnant economy or whatever, won't be dealt with by talk. There has to be action. There has to be events that change things. And he can go out and yack all he wants, it isn't going to help.

CARLSON: Especially Republicans, who are they? If you listen to the president and you watch to other cable channels, you get the impression that Republicans are in charge in Washington. They are thwarting the agenda of the president.

They still have 59 Senate seats. They have overwhelming majority in the House. They run everything.

So the real debate isn't between the president and the Republicans. It's between the president and the Democratic caucus. This is not reality- based talk. And I think most people that know anything about it understand that.

BAIER: All right, please remember to vote on your choice online topic of the week, Friday's lightning round, you can find that on our new and improved web site. You have until 4:00 p.m. Friday to cast your vote there. There you see it on the right side.

The tea party convention will try to bring a lot of disparate groups together. Will it work? Rush Limbaugh weighs in on this topic after the break when we are back with the panel.



RUSH LIMBAUGH, RADIO TALK SHOW HOST: They are going to come to their senses and realize all a third party will do to guarantee the elections Democrats. The Perot party was the same thing. Let the Democrats do the third party thing. The success here in the future is going to be conservatism dominating, retaking, if you will, the Republican Party.

SARAH PALIN, R-FORMER ALASKA GOVERNOR: I think those on the political radical left would love to see disunity in the tea party. They would love to see fissures especially between the tea party and Republican party. If anything I see a coalescing.


BAIER: The national tea party convention bringing together all kinds of groups from all over the country is in Nashville right now. They are meeting, talking about an agenda and a way forward.

What about the tea party movement overall and how effective it will be in 2010 elections? We are back with the panel. Mara, we got you a cough drop and some hot tea. What do you think.

LIASSON: Thank you very much.

I think this the tea party movement, the big question when it started is will this be a divisive thing for the Republican Party or will it be a source of energy? I think it's turning out to be a source of energy.

I think that any smart party absorbs energy on its fringe, whether it's the right wing of the Republican Party or the left wing of the Democratic Party. I think the Republicans have been pretty smart so far about doing that. And I think they have been harnessing the tea party activists. I think it's easier when you are the opposition party and you can be united by hatred or fear of the majority Democrats. But I think all these primaries so far don't seem to be weakening Republican candidates. I think that, in the end, if the tea party people have a role to play, they end up nominating some Republican candidates. They are going to be even more energized to work for them. I would say the Democrats have had harder time with Moveon.org and the left wing of their party, who has almost taken the Democratic majority for granted and felt free to really criticize and throw grenades.

BAIER: Fred, Democratic strategist Pat Caddell said he thinks that it's the most powerful movement since the antiwar movement he has seen in his lifetime. That's kind of a bold statement. But do you agree with Russia all these groups can come together under a Republican label.

LIASSON: No, I agree with Mara. She says they already have, and I think that's true, what's happened. And she mentioned particularly the elections. Virginia, New Jersey, Massachusetts, where the tea party were indistinguishable from others who were just normal Republicans.

And the truth is they have the same agenda. I mean, who are the tea party — look, when we say the tea party, it's not a party. I think you said it right, Bret, it's the tea party movement.

And Remember who started this movement? Rick Santelli, a guy on CNBC, when he was complaining about the stimulus. This was a year ago in February of 2009 about the expense of the stimulus and the part of the budget that was just passed and saying we needed tea parties all over the country.

And this is the time when Republicans were generally terrified, and they started having these rallies and things. But they had melded perfectly with the Republican Party because they believe in cutting spending, cutting taxes, reducing the size and scope of government. That's the Republican agenda, too.

BAIER: I don't think he is taking credit for it on CNBC, though.

CARLSON: No. I think he knows that he, at least allowed these feelings to coalesce, feelings that I think have been around since the late Bush years, actually.

I agree with Fred and Mara completely that you have to construct a pretty complicated scenario how the tea parties hurt Republicans. It's very obviously how they hurt Democrats. So obviously it's a net gain for the Republican Party.

But there is latent hostility towards Republican leadership here. Fred said that the tea party and the Republicans have the same aims, less spending, smaller government. But to some extent, you know, there have been Republicans who don't have those aims, and they are definitely in the crosshairs of the tea party people who feel deep resentment toward them as accommodationists.

And I think as the tea party gets stronger they will in effect, anyway, force changes in the leadership level.

BAIER: What about the talk that it will tough to harness all of this effectively by the elections?

CARLSON: You will see what you always see, which is what you are seeing it right now. All these reporters in Nashville will find some crazy person with a sign that says something ludicrous and attempt to brand the whole movement with that sign.

But, in the end, that — and you know, Republicans seem to be wise about how they use the tea party energy. But, in the end, it's still energy that's moving in the same direction they are, and it's hard to see how that doesn't help.

BAIER: Mara?

LIASSON: I really agree. I think that, you know, there is nothing negative that I can see about this. Any time you have an energized, activist group of people who want, you know, your candidates to get.

Now, there are going to be primary fights and conservative Republicans against more moderate Republicans, and in a lot of those cases the conservative might win.

But I don't see anyone so far who is out of the mainstream. Marco Rubio in Florida, Scott Brown in Massachusetts, Bob McDonald, these are candidates who are mainstream candidates who are learning how to appeal to the tea party people without turning off mainstream voters.

BAIER: There is consensus here. What does the White House think about this movement, do you think? They dismissed it out of hand at the beginning.

LIASSON: I think they understand what it is because, you know what, they had one on their hands too that they benefited from. They had an energized, activist movement. I don't know what we want to call them, the kind of Obama-voters that propelled them into office. And now they're seeing it happen on the other side.

BARNES: You know, Republicans aren't always smart, but they have been smart about the tea party movement. They haven't tried to go in and take it over. Here is a movement, it's a grassroots movement. It doesn't have any leaders. You have to sort of integrate with them and join in with them. And they have done a pretty good job in that.

BAIER: Yes. And the numbers seem to be expanding in each one of these races.

BARNES: Yes. They are growing, and a lot of people are the Perot people left over from the 1990s and people who have not been involved in the Republican Party, but they are obviously going to vote that way because they are conservatives. Sometimes they are libertarians as well.

But they are a part of the broader Republican coalition, which needs to be a big one if they are going to win this fall.

LIASSON: But you know what is the most important thing, the fact that their number one issue seems to be fiscal conservatism right now.

Now, I think there is a continuum between the anti-immigration forces that helped bring down George W. Bush's immigration bill that was a detriment to the Republican Party because it made them look intolerant and anti-Hispanic.

But now the issue that seems to be number one for them is something that most mainstream voters, including a lot of independents, completely agree with.

BAIER: Final word.

CARLSON: It is about spending. That is the beginning and the end of this unless it is hijacked by someone with an entirely different agenda. That is an appealing center of the country agenda that could take them really far. Spending, that's it.

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