This is a rush transcript from "On the Record," November 23, 2011. This copy may not be in its final form and may be updated.
SHANNON BREAM, FOX NEWS GUEST HOST: The holiday season kicking off with a mixed bag of economic news, the markets seeing their worst Thanksgiving week performance in 38 years. And the number of people applying for unemployment benefits rising slightly. But there is a little bit of good news. Incomes are up, and economists say that could boost spending during the all-important holiday season.
So how will voters' economic jitters factor into the 2012 race? Democratic pollster and former adviser to President Clinton, Doug Schoen, joins us. And Doug, great to see you tonight. Thanks for joining us.
DOUG SCHOEN, DEMOCRATIC POLLSTER/FOX NEWS CONTRIBUTOR: Thank you, Shannon.
BREAM: All right, so the economic outlook right now is not very positive. What does this president do with that going into 2012?
SCHOEN: Well, he's been running a left-populist campaign. He's been attacking Wall Street, the Republicans, the business community. I think what he really needs to do is recalibrate, go big, as Tom Friedman in The New York Times said, and try to do a budget deal to reconcile the kind of differences and issues Congressman West was talking about, but to try to get $3 trillion to $4 trillion dollars in cuts, tax reform, and more importantly, economic growth to create jobs.
BREAM: Doug, do you think that the president helped or hurt himself by staying out of the minutiae of what the Super Committee was doing?
SCHOEN: Well, he got involved in the super-committee's work previously, or that which was done over the debt ceiling, and it hurt him. The left and the Democratic Party said he'd compromised his position back in the summer. So this time, he stayed out.
Ultimately, he was MIA. There was no deal, obviously. I don't think he's helped his position. And given the market's reaction, there's clear evidence, I think, that there's increasing lack of confidence in our fiscal policies.
BREAM: Well, and looking ahead, even as early as next week, possibly some more fights here on Capitol Hill about things like extending the payroll tax holiday, about extending unemployment benefits, things that will evaporate at the end of the year. Now, the president has said, You're doing wrong by American families if you allow those things to go away because it's going to financially hit people in their pocketbooks at the time they can least afford it. But of course, Republicans come back and say, How are you going to pay for this? Because it's not free.
Who do you think will win the spin battle on those fights?
SCHOEN: I think the president will probably win the short-term battle on both of them, on both the payroll tax cut and extension of unemployment benefits. But I think he ultimately loses the big battle because, Shannon, he has no answer to the question of how he's going to create jobs, stimulate the economy and deal with the larger fiscal issues.
The tax cut is a popular issue, as is extension of unemployment insurance. But it misses the larger point, which is the president's rating on the economy is under 40 percent rating, and people don't believe he has a plan to revitalize a sputtering economy.
BREAM: Yes, and just yesterday, the third quarter GDP was revised downward.
BREAM: I mean, that's another tough number for the administration to deal with. So how is the president doing in key states on these economic issues?
SCHOEN: He's doing I don't think so well. If you look through the industrial Midwest, his poll numbers are under 50 percent. He's even with or behind Mitt Romney. He's going to try to make up for his loss with independents and with Rust Belt voters with picking up some states in the Southwest and hold onto some states like Virginia, Carolina and Florida in the South, that he won last time.
It's a tough nut to crack. He can be reelected because the Republicans are arguably less well-regarded than he is. But right now, the electoral map presents a daunting challenge.
BREAM: OK. So we're going into the holiday season, and a lot of people will want to look and see how confident consumers are feeling when they go out and spend or don't spend on "Black Friday" and all the way through and Christmas and Hanukkah shopping. How important is it to this administration that there be good signals from consumers that they're comfortable spending their money?
SCHOEN: Well, I think it will help the administration if we have a robust and healthy shopping season. I don't think it's going to ultimately reassure people about the larger challenges facing our country. But if we have a drop in spending, as is possible, it could further jeopardize consumer confidence, which would be calamitous for the president.
BREAM: Any predictions going into those important shopping holidays?
SCHOEN: Yes, my sense is it's going to be up because I think people sort of see, you know, only storm clouds on the horizons, want to have one good holiday season. And let's hope that Americans have a good Thanksgiving -- you, too, Shannon -- and a good holiday season.
BREAM: You, as well, Doug. Thank you very much for sharing your expertise with us tonight.
SCHOEN: My pleasure.