This is a rush transcript from "Special Report With Bret Baier," September 16, 2010. This copy may not be in its final form and may be updated.


HOUSE MINORITY LEADER JOHN BOEHNER, R-OHIO: She ought to pledge t hat there will be an up and down vote on all of the coming tax hikes. Anything less than that is unacceptable. If the Speaker allows an up or down vote, I'm confident that the American people will not see increases in their taxes.


BRET BAIER, ANCHOR: Well, the talk there from the House minority leader about extending the Bush era tax cuts, all of them, wanting the House speaker to have a vote on the House floor up or down.

Just moments after that news conference, House speaker Nancy Pelosi appeared. She was asked at one point is there any chance the top bracket tax cuts would be extended this Congress? Here was her answer.


HOUSE SPEAKER NANCY PELOSI, D-CALIF.: The only thing I can tell you is that the tax cuts for the middle class will be extended this Congress.


BAIER: Well, that prompted a clarification from her office quickly after that. "The speaker has made her position abundantly clear and repeatedly said she supports President Obama's middle class tax cuts. The speaker is opposed to extending the Bush tax cuts for the wealthiest two percent because they add hundreds to the deficit and do not create jobs."

Obviously, that's a term they want to use now, the Democrats do, the "Obama middle class tax cuts." Let's bring in the panel, Steve Hayes, senior writer for the Weekly Standard, Nia-Malika Henderson of the Washington Post, and syndicated columnist Charles Krauthammer.

Republicans, Steve, sense there is some momentum here they could possibly force a vote on this. What's your thought?

STEVE HAYES, SENIOR WRITER, THE WEEKLY STANDARD: What a fun game of chicken. Last weekend you had John Boehner, essentially tipping his hat or saying he could live with the Democratic compromise. And now today you have Nancy Pelosi implying, I think, at least that she could live with what Republicans want to do, which is extend all the tax cuts.

The question is how do you get there procedurally? The only real bill right now that would actually extend all of the Bush tax cuts or the only bill that deals with the tax cuts in any way right now is Mitch McConnell's bill which would extend everything and deals with the AMT.

Democrats don't yet have one, of the question is whether Harry Reid wants to have one before they go home or whether he doesn't. There's been some noise that he's open to it and there is some talk of a Baucus bill, but nobody knows exactly what would be in that.

And they're worried, the Democrats are worried about what the deficit numbers would be like if they include the AMT. Does it, does the projected deficit number go from $2.2 billion to $3.2 billion.

But I think broadly speaking the momentum remains on the Republican side, at least rhetorically and at least politically, because Republicans are going to be able to say if there is no vote or if there's a vote and it doesn't extend to all the tax cuts, they're going to be able to say what I think is the strongest argument still today, why are we raising taxes in the middle of a recession?

BAIER: And Nia, some moderate Democrats, a growing number of them are starting to say that. Glenn Nye from Virginia is one of them. Take a listen.


REP. GLENN NYE, D-VA: I think what we need to be doing right now is holding the line on taxes, not letting anybody's taxes go up at least until we see the end of this terrible recession.

I think it's a pretty simple idea. There are a number of other folks here also on the Democratic side that agree with me on this. You know I led a letter along with some other members. We have 31 signatures on it among the Democrats here that said it's not the time to raise anybody's taxes.


BAIER: So what about that?

NIA-MALIKA HENDERSON, WASHINGTON POST: Yes, no, I was talking to Jerry Connolly on Monday who was at a town hall with President Obama. President Obama was there talking about not wanting to extend these for, for the upper income folks, and Jerry Connolly was there, saying, hey, he'd want to extend these for everyone, at least temporarily, because he thinks that the recovery is too fragile.

So it's not just about Republicans, it's almost kind of like you've got a revolt among Democrats who are also saying that maybe this recovery is too fragile for a tax hike at this point. They've got a real problem on their hands.

BAIER: The question, I guess, is will there be had a vote in this short session before they head off to elections?

HENDERSON: Yes, I mean, that's everybody's question. We were talking before. It looks like Reid might skip down early. I mean, one of the things, and Steve and I were talking about this before, in some ways it might not really matter. I think a lot of the talking points about this election are built in already.

And even if something happens, it's not quite sure, I'm not quite sure how much folks will kind of vote on that, because, you know, we've got 9.6 percent unemployment rate and I don't know how much it will move the dial, whatever happens.

BAIER: Yes, Charles, there are some numbers that were troubling out today -- repossessed homes, banks, repossessed more than 95,000 homes last month. That's up three percent from July, an increase of 25 percent from August of last year. Also, poverty, poverty is up 43.6 million people. That means one in seven Americans is technically in poverty according to the Census Bureau.

CHARLES KRAUTHAMMER, SYNDICATED COLUMNIST: I think these numbers are really important. These numbers are going to sway the election. I think what the Democrats are trying is to create a sideshow with the issue of the, you know, of helping the rich, which is the old refrain, as a way to distract attention from an economy which they had told us the stimulus would rescue and obviously hasn't.

I think on the cuts themselves, I think the real news of this week is the revolt of the young Democrats and the ones who are in trouble. You go from one to 31 Democrats asking the leadership in the House to allow a vote for a full extension of the cuts to everyone, and that scares Pelosi.

If we heard her statement, which we had up earlier, you notice how she edges had her language. She says that the middle class tax cuts will be extended in this congress. But that could be a Congress that meets after Election Day in which a lot of the losers already having lost but still in office until January, perhaps -- I don't want to imply it's going to happen -- but the dangling of an ambassadorship here or an appointment there, might join her in having only the cuts on the middle class.

So, it's this Congress, I don't think it's going to happen before Election Day, and I think it will likely, if there is a vote after election, I think it will be a full extension of the tax cuts to everybody, because, as Steve has said, it's hard to imagine raising these on the people who employ in the middle of a recession.

BAIER: Let's just play the crystal ball here. Let's say they managed to put together something that extends all the of the tax cuts for two years, OK? The house passes it, the Senate passes it. Is President Obama going to veto something like that because he only wants 250 or below?

HAYES: Before the election, you mean? I mean, first of all, I have trouble seeing the Senate pass that, frankly. They need to pick up 19 Democrats, Republicans, when I think that becomes difficult.

The president, though, what's interesting to me, you've had Nancy Pelosi leave the door open. The president has at least twice by my count left the door open. He's not said he's going to veto this, which I think gives some indication that he knows he doesn't want to be flexible about it, but he might have to be flexible about it.

HENDERSON: I mean, his spokesman said something like, I don't think it will come to that. He'll have to whip out the veto pen, but I can't see him really doing that and vetoing this if it comes to that.

KRAUTHAMMER: In a sense, both sides are holding hostages here. In the end if Obama has a bill which would include the cuts for everybody, I'm not sure he could veto it and survive politically.

BAIER: Up next, we'll talk about the Pope's visit to great Britain. You can still vote in tonight's text to vote poll, either texting or getting on the home page, asking how concerned are you about the secularization of society? Log on to our homepage at FOXnews.com/Special Report.



QUEEN ELIZABETH II OF THE UNITED KINGDOM: Religion has always been a crucial element in national identity and historical self-consciousness.

POPE BENEDICT XVI: There are some who now seek to exclude religious belief from public discourse to privatize it or even to paint it as a threat to equality and liberty.


BAIER: Pope Benedict in Glasglow today, celebrating an open air mass with huge crowds there. The first official visit by a Pope to Great Britain in nearly 500 years officially. But the Pope had a message, a warning about the secularization of society, a warning that he feels faith is being crowded out in some places.

What about that, the message, and the Catholic Church? We're back with the panel. Charles?

KRAUTHAMMER: Well, he's right. The decline of religion in Europe is one of the most striking phenomena of the last 50 years. And I think one of the reasons that you see all the visits and the gestures, the ecumenical spirit between the Catholic Church and the Anglican, as an example, is that there is a sense that the age old rivalries, which were actually wars in the past between the denominations is really obsolete in the face of the real threat to all of Christianity in Europe, which is the growing secular trend.

The churches in Spain, in Portugal, in Italy are empty. The Anglican churches in England are less attended than given the mosques in England. And I think that is what the Pope is seeing as the great threat to Christianity in general.

And I think in part the ecumenical attempt is attempt is a way to say, look, our struggles among ourselves are really over and almost irrelevant. The real issue is the growth of science, the growth of some sort of enlightenment, atheism.

And as a result of that, we have to find a way to reinvigorate religion and that's what he and his -- sort of, the archbishop of Canterbury and all the counterparts throughout the rest of Europe are attempting to address.


HENDERSON: I guess in some ways you wonder if the Pope is the right person to do it. When the Pope talks about secularism, he means the use of condoms that people are having sex before marriage.

And I just don't know if -- I think one of the threats to this is the rigidity of the church, and that's one of the, you know, the threats to the decline in participation in church and participation in Catholicism and certainly some of the scandals that this Pope has in some ways been a part of and in some ways tried to confront.

BAIER: Sure, and he addresses those. He addressed them on the way to Great Britain about the scandals, the saying about the priests that he called the perverse practice of child abuse that folks who were involved in that. Just take a quick listen to him addressing this.


POPE BENEDICT XVI (via translator): It is also a great sadness that the authorities of the church were not sufficiently vigilant and insufficiently quick and incisive in taking the necessary measures.


BAIER: So this Pope obviously has to deal with that specifically, Steve. But there is a broader message, as Charles was talking about, about secularization. Is America becoming more secular than we were as a country before?

HAYES: I don't think there's any question. I mean, it's not just that America is becoming more secular. It's that America, that we don't talk about religion in public life the way that we used to 30 years ago, the way that we used to 50 years ago.

On some senses it's better because I think there's more tolerance for other religion. In other ways I think we're diminished because of it because we don't have those kind of public exchanges in any sort of a meaningful way.

If you look the way we've been talking about religion in this country, really, for the past decade, almost all of the focus has been on Islam in one discussion or another about it. You don't get a sense-- I mean, it's out of proportion to the number of Muslims in the country and that the number of people who are practitioners of other faiths, Christians, what have you.

There are actually more Buddhists in the United States today than there are Muslims, but you certainly wouldn't know that by the kind of discussion that we've been having over the past several years.

BAIER: There's been focus on President Obama and his family's choice not to go to church and be seen going to church for a number of different reasons. What about that? Does that factor in?

HAYES: Well, I certainly think it does. When you think back to President Bush, he was a Protestant whose rhetoric, whose language was sort of suffused with Catholic intellectualism, and he often used rhetorical imagery, religious references, in his language.

President Obama does that, he does it less often, and when he does it, like in his inaugural, he takes the time to point out "I'm quoting scripture here," which probable didn't do. It's a much different tone and the fact that the president is not as publicly religious as past presidents have been -- certainly sets an example.

BAIER: Charles?

KRAUTHAMMER: But I'm not sure that our politicians or presidents have any influence over the level of religiosity. I think what is really striking is how religious America is with how irreligious Europe has become. I think that is really remarkable. Church attendance here is infinitely higher. I think belief in God is nine out of ten, which is much lower in Europe.

And secondly, I'm not sure it's the rigidities of the church that are leading people away. On the contrary I think it's the more liberal denominations who offer nothing essentially who have the empty pews, and it's the more evangelicals in the United States who have this kind of reliable with a lot more structural, and Catholicism as well which also have structure, which have sort of withstood the secular trend the best. So it's rather ironic that it works the other way around.

BAIER: Nia, last word.

HENDERSON: I think on Sundays in my community here in D.C., I see people going to all the time and I see the pews are very full. I don't know that there's necessarily a connection between what the president, president does on Sunday and people's decisions to go to church.

It seems like it's, you know, it's a private expression that people, you know, maybe some people watch Joe Olstein on TV on Sundays or go to church or bedside Baptist, as one of the jokes goes. But I don't think there's a big kind of threat to this whole idea.

BAIER: OK, well, time to reveal the results of the text to vote poll. We asked, how concerned are you about the secularization of society? And 87 percent said "very concerned," four percent said "slightly concerned," nine percent said "not concerned." Thanks for your votes. We have more than 10,000 of them tonight.

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