This is a rush transcript from "Journal Editorial Report," January 18, 2014. This copy may not be in its final form and may be updated.
PAUL GIGOT, HOST: This week on the "Journal Editorial Report," President Obama moves to limit the NSA's surveillance powers. Will what he is proposing put America at risk?
Plus, newly released health care enrollment numbers raise new concerns over just who is signing up and sending the administration scrambling to attract younger enrollees.
And as the West gets set to implement the Iran Nuclear Accord, is the pact the surrender that Tehran claims it is or the window of opportunity President Obama hopes it will be.
Welcome to the "Journal Editorial Report." I'm Paul Gigot.
President Obama laid out his plan to curb the National Security Agency's once-secret surveillance programs on Friday, setting limits on the collection of foreign intelligence, appointing a public advocate for the FISA court, and making major changes to the agency's controversial collection of bulk telephone records. The president's speech comes after a months-long review of the agency's intelligence gathering practices, prompted by last year's leak of classified documents by former NSA analyst, Edward Snowden.
Joining the panel this week, Wall Street Journal columnist and deputy editor, Dan Henninger; and editorial board members, Joe Rago and Matt Kaminski.
So, Matt, what do you make of the proposals the president is making here?
MATT KAMINSKI, EDITORIAL BOARD MEMBER: I think he's gone very far towards unilaterally disarming the U.S. --
KAMINSKI: -- on surveillance. Basically, since the Edward Snowden revelations six months ago, he's tried to straddle both lines, saying I want to satisfy the privacy concerns but I want keep our national security. I think the steps he's taken, especially on neutering this telephone collection program --
GIGOT: Of metadata, which is not listening on phone calls.
KAMINSKI: Not at all.
GIGOT: But it's, if you call Joe, your number, his number, how long the call lasted, that sort of thing.
KAMINSKI: Right. Right. He is also extending essentially constitutional protections to foreigners by saying their privacy concerns are as important as Americans' privacy concerns. The job of the spy agency is to spy on foreigners. Lastly, he's sort of complicating this already unwieldy judicial process of court oversight of the intelligence services, so there is more bureaucracy, more rules, and I think in the end U.S. is less safe.
GIGOT: Joe, is there any precedent for providing privacy protections anywhere around the world to foreigners? Let me put it another way. Do the Chinese give you privacy protections when they are listening in on your e-mail?
JOE RAGO, EDITORIAL BOARD MEMBER: Right. There's really --
GIGOT: I don't think so.
RAGO: There is no precedent here. For all that Edward Snowden exposed, we haven't seen anything that violates international laws, international norms. These are core --
GIGOT: Or the U.S. Constitution.
RAGO: Right -- core Constitution national security powers that belong to the president. And it's just a remarkable extension here.
DAN HENNINGER, COLUMNIST & DEPUTY EDITOR: When you think about it, Paul, it's gotten to the level of absurdity. We are talking about extending the privacy act to Vladimir Putin and the Chinese, which is laughable. But the problem is I think that the president has allowed it to get to this point. We have been having this argument for nearly a year since Edward Snowden made these revelations. The Snowden revelations have continued. The president --
GIGOT: And they are going to continue and continue.
HENNINGER: But President Obama has never stepped forward to make an argument on behalf of these surveillance techniques, why we do it. Instead, he allowed the problem to fester. It has gotten to this point. Then he appoints this commission --
HENNINGER: -- to make recommendations to him, at which point both sides are totally dug in on this issue. He's just made kind of a botch of it and come up with this set of solutions that aren't going to satisfy anyone.
GIGOT: But if the White House were here, they would say, what are we going to do? The politics are such that we have to make these concessions in order to forestall even worse, a worse route on Capitol Hill. So we've got to do this. We are making tactical concessions. They're not that great. In fact, the left is going to still dislike them and criticize them, and even some Libertarians. So, but we are trying to thread the political needle here. Give me a break.
HENNINGER: He's leading from behind. He's on defense. He should have been on offense much earlier than this. And I think we could have had a more productive outcome if he had been on offense.
GIGOT: Matt, what is going to happen on Capitol Hill? You've got the chairman of the Intelligence Committee, Senate and House, Dianne Feinstein and Mr. Rogers, Joe Rogers (sic), that both say and defend these programs, say we need them. On the other hand, you've got other people who are much more critical. Who is going to win?
KAMINSKI: I think just you wait until Congress gets involved. Because if a president signs executive orders, those can be reversed easily either by him or by a future president. But the Congress has really shown that we want to get in this game, too, politically.
KAMINSKI: They came close last summer to killing the NSA program and they will try again.
GIGOT: But what is going to happen?
KAMINSKI: I think they are very close to having -- because the president is being pinched by both sides. You have the traditional left and the kind of right fringe Libertarian --
KAMINSKI: -- who are coming together, and together they might be very close to a majority.
GIGOT: Where is the center of gravity, Joe, among Republicans here? Because they are going to be crucial. If they go along with what the president proposes, this is a done deal. If they resist, you might have a chance at preserving the surveillance powers.
RAGO: That's the big question. A lot of the more mature members of the Republican Party are really resistant to the kind of proposals that Obama has come forward with. I think they are going to have to exert their influence if they have any hope of doing real lasting damage to the powers of the next president.
GIGOT: I think I got that wrong. It's Mike Rogers.
HENNINGER: It's Mike Rogers.
GIGOT: I apologize for that.
Dan, what do you think?
HENNINGER: Well, what do we think our enemies are making of this? Al Qaeda is the reason we do the surveillance. I think if I were an al Qaeda planner out there in Pakistan or Yemen or Africa, I would be dancing in the streets over these changes. It just simply opens the door a crack. That's the reason you do these sorts of things. There is a threat, but it's hard to recognize it most of the time.
GIGOT: All right, Dan.
When we come back, just released enrollment numbers may spell trouble for ObamaCare. But could they mean a taxpayer bailout for insurance companies?
GIGOT: Newly released ObamaCare numbers reveal that 2.2 million people selected a plan through the end of the December but less than a one-fourth of those are between the ages of 18 to 34, a group crucial to the law's success. So the White House is calling in the star power one again in hopes of driving young people to enroll before the March 31 deadline.
This week, basketball legends Magic Johnson and Alonzo Mourning began appearing in TV ads airing nationally during NBA games.
(BEGIN VIDEO CLIP)
MAGIC JOHNSON, FORMER NBA BASKETBALL PLAYER: You never know when you're going to need it. It's very important. Young people, they think they're superman, like nothing will ever happen to them. But trust me, one day, something is going to happen and you're going to need a quality health plan. So make sure you get ObamaCare.
(END VIDEO CLIP)
GIGOT: We are back with Dan Henninger and Joe Rago. And Wall Street Journal columnist, Bret Stephens, also joins the panel.
So, Joe, how much are the enrollment figures below the target that the administration had?
RAGO: What they are shooting for is about seven million by the end of March. Ultimately, we need about 20 million people to sign up. This is really well below target.
GIGOT: So they have 2.2 million now?
RAGO: 2.2 million right now. And if you think about it, I mean, one in six people in this country under 65 lack insurance coverage --
GIGOT: What's that, 35 million, 40 million people?
RAGO: At least officially. They are either looking at the exchanges and finding that ObamaCare plans aren't offering them a good value or they're buying health plans off the exchanges where the regulations are somewhat looser and they can be tailored to individual needs.
GIGOT: And they're skewed -- go ahead, Bret.
BRET STEPHENS, COLUMNIST: This is 2.2 million who have signed up, not necessarily who have gotten insurance, while --.
GIGOT: Or written the check to pay for it.
STEPHENS: Right. Another five million people who canceled -- have had their insurance policies canceled. So in terms of overall figures, we are actually in a hole here.
GIGOT: What about the actuarial, to use an insurance term, status here? We really don't know the health status of these enrollees. But, so far, they seem to be skewing older. That is one-third are between 55 and 64, not enough young people. That probably means not as healthy a pool as you need.
RAGO: Right. Age is a crude proxy for health status, which matters. In normal insurance markets, people would be charged premiums based on their risks. So it really doesn't matter who signs up. Here, they --
GIGOT: Young people pay less. If you're older and sicker, you pay more.
RAGO: Right. But here you need people to have cross transfers between groups. And that's --
GIGOT: Because of the ObamaCare mandates, which are imposed and raise the price of insurance.
RAGO: Right. What happens over time, and we are already starting to see in some states, is there is a bad mix, so premiums will surge the next year. People will drop out. It's called a death spiral in insurance jargon.
GIGOT: And is that a real risk?
RAGO: It's a real risk. It's not an immediate risk. It will take several years, but it's definitely a risk.
GIGOT: Dan -- go ahead.
HENNINGER: Well, it's called, in insurance terms, adverse selection.
HENNINGER: But let's get back to Magic Johnson. I mean --
-- What he is not telling those young guys sitting out there watching that NBA game is THAT, oh, and by the way, you are going to pay more for this insurance than the sick people.
GIGOT: And more than the penalty you'll pay if you don't buy the insurance.
HENNINGER: Yeah. They are sitting out there going, hey, man, if I had your income, it's OK.
Then I can get insurance. But this is going to be expensive for me.
I think a lot of these young people, by now, because this is so publicized, are beginning to figure that out. They don't like the terms of the deal that they pay more so these people can pay less.
GIGOT: Why are insurers, Joe, so publically, at least, still supportive of this? They are basically saying, yeah, rough start, difficult, but we'll get over it and it will get there. Even though Humana, the insurer, filed with the SEC and said, look, the pool of insured that we are getting isn't what we had hoped.
RAGO: Right. I think they expected things to go badly. I don't think they expected them to go this badly. And --
GIGOT: You talk to these people off the record, or on background, all the time. What are they telling you in private?
RAGO: In private, they are saying that the selection problems are much worse, the mix is bad. There was an interesting -- United Healthcare, one of the largest insurers in the country, chose to participate in just a few exchanges because they thought the problems would be so bad. Their CEO this week said their enrollment was so low that they could send a gift basket to every one of their enrollees.
RAGO: And that this was a good thing for shareholders because their losses would be limited.
GIGOT: Bret, should Republicans run against this idea there is going to be an insurance bailout? Because there is part of Obama care that says, if the pool is as bad as Joe said it is, there are mechanisms by which HHS will provide money, reinsurance pool --
GIGOT: -- to offset some of those losses.
GIGOT: That's right. This is part of the law. It's designed to -- it was written into the law. There are some Republicans, like Marco Rubio, saying this is an insurance bailout. Should Republicans be making this case?
STEPHENS: Of course not. We shouldn't be supporting bailouts for failing industries, whether they're in finance or --
GIGOT: No, the Republicans are against the bailout.
STEPHENS: That's right. I think Marco Rubio is absolutely right. There is an old expression about lying in the bed you make. And the health care industry, the health insurers certainly were in this bed with the Obama administration in preparing ObamaCare. I think there should be no bailout for them and the law should be allowed to fail.
GIGOT: All right.
Well, thank you, all.
Still ahead, Iran's president calls it a Western surrender. Our president calls it a door of opportunity. So which is it? We'll take a closer look at the nuclear agreement set to take effect on Monday, when we come back.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: If Iran is willing to walk through the door of opportunity that is presented to them, then I have no doubt that it could open up extraordinary opportunities for Iran and their people. My preference is for peace and diplomacy, and this is one of the reasons why I've sent a message to Congress that now is not the time for us to impose new sanctions.
(END VIDEO CLIP)
GIGOT: President Obama this urge urging Congress to give peace a chance and hold off on new sanctions against Iran. His plea comes ahead of Monday's implementation of an interim deal reached in November by Iran, the U.S. and five other world powers to curb that country's nuclear program. The full text of that pact has yet to be publically released. And Iran says it contains a side deal not officially acknowledged by Western leaders.
We're back with Dan Henninger, Matt Kaminski and Bret Stephens.
Bret, explain something to me. Why would the administration want to release the text of this?
STEPHENS: Yeah. This takes you back to the period of Molatroff (ph) and Ribontroff (ph) and secret pacts and secret negotiations.
GIGOT: But why wouldn't they release it?
STEPHENS: Well, this is a great question. If they are so confident that this is a good deal for the world, there should be an open diplomacy, just as Woodrow Wilson insisted in the 14 points.
GIGOT: Are they afraid of what's in it?
STEPHENS: I think they might be concerned that it shows just how much the West had to concede in order to get any kind of agreement with the Iranians.
GIGOT: There is this brutal fight behind the scenes between the administration and the Senate, Matt, where 59 Senators have signed on to this bill that would offer new sanctions if the final deal negotiations fail. It wouldn't be right now, but it would be if, conditional. And the administration is really putting pressure on Democrats not to sign on to this, but 59 Senators support it. Why are the Senators so -- why are the - - even the Senators of the president's own party doing this?
KAMINSKI: Because they don't trust President Obama's judgment here. They are not convinced that he is going to get a good deal with Iran. There is concern that President Obama, who so badly wants a foreign policy legacy, and that would be peace with Iran, will settle for something which will not stop and dismantle Iran's ability to get a nuclear weapon, which, in the long term, would be bad for the region and bad for U.S. security.
STEPHENS: Also, you have to remember the context. Obama would like to take credit for the past round of sanctions, bringing Iranians to the table.
GIGOT: That's correct, yes.
STEPHENS: Except that it was the Democrats in 2010 who basically shoved that down the administration's throat against internal administration objections. And by the way, we are not talking about new sanctions. We are talking new sanctions in the event --
STEPHENS: -- that these negotiations fail. So when Obama says we don't need new sanctions that's not really what we are discussing.
GIGOT: The White House is rolling out the rhetorical guns on this and saying basically, if you support this bill, Democrats and some Republicans who support it, you are basically supporting war.
HENNINGER: Well, it is mainly a rhetorical gun. And I think Matt has put his finger on it. Barack Obama has shown himself to be variable and unpredictable in matters of foreign policy. The biggest example was the red line over chemical weapons in Syria, which he abruptly changed --
HENNINGER: -- after he went for a walk back in the White House garden. I think a lot of these Democrats feel that they just do not believe they know where they are going. Think, Paul, back to the way we used to negotiate arms reduction treaties with the Soviet Union in the '80s. At that time, you had a clear idea of where we were going, what the plan was, what the goal was, and what the Soviets were doing. This is Barack Obama saying, trust me, I'll take care of it. You don't need to know what's going on. It will all come out in the end. That is not the way do you high-level arms negotiations.
GIGOT: But the White House also says, Matt, that if this bill passes, it includes terms that the Iranians cannot possibly accept, including zero enrichment and no long-term missile-delivery systems for potential nuclear bombs. It's basically a poison pill.
KAMINSKI: Basically parroting the Iranian lie --
GIGOT: But you don't agree?
KAMINSKI: I think if they do walk away, we should know now, rather than later on. If the Iranians are not willing to negotiate in good faith, they're saying, well, we -- you know, then we should -- it's better for us to know right now. It is really a false choice that's being presented to Democrats and they're no buying it. It's either a war or it's Obama's version of a peace deal. Iran has to be held accountable and has to be forced to give up its nuclear weapons. That's why we have sanctions and that's why it's important to keep them in place.
GIGOT: The other objection is that if passes, then the Americans will get the blame because it will give the Iranians an excuse to walk away from the talks. The world will blame the United States for the failure. Then the sanctions regime will collapse anyway. So you shouldn't pass this even if you want the sanctions to be stronger later on.
BRET: Well, I mean, are we engaged in a popularity contest with the Iranians or are we trying to stop them from getting a nuclear weapon? That is what is so disconcerting about a lot of the talk with Iran now. By the way, there was broad public approval and international approval for strikes on Syria. The people like Francois Hollande, the Saudis were willing to go along with it. That international approval didn't mean anything in the end. The objective is to stop Iran from getting within reach of a nuclear weapon. It's not about winning the hearts and minds of the population in Canada or Germany or Japan.
GIGOT: Is it going to pass, Matt, this bill?
KAMINSKI: I think it will. After the State of the Union speech in February, the Democrats are actually sticking with their support for this bill and it's close to veto-proof.
GIGOT: Matt (sic)?
STEPHENS: I don't think it will pass, but it's a useful fight, like the Panama Canal treaty, to show how weak the president is.
HENNINGER: I agree. I don't think it will pass. I think Democrats will step back. But the point has been made.
GIGOT: I think Harry Reid will find a way to kill it, Matt.
He always does if it's going to put the president in a veto position.
We have to take one more break. When we come back, "Hits and Misses" of the week.
GIGOT: Time for our "Hits and Misses" of the week -- Dan?
HENNINGER: Paul, I'm going to a miss to California Governor Jerry Brown for announcing he will not run for president in 2016. This is a shame. He's run three times before, starting in 1976, before most voters were born. Most recently, in 1992 against Bill Clinton. It would have been nice to see him run again against Bill Clinton's wife, hold her feet to the fire. And you never know. We'll miss him. But he might change his mind.
GIGOT: Yeah, the entertainment value would be worth it.
STEPHENS: I would like to give a hit to the Israeli defense minister who, in private conversations, assailed Secretary of State John Kerry's diplomacy, accusing him of incomprehensible messianism and an obsession with the peace process. He said, "Please, Mr. Secretary, take your Nobel Peace Prize and leave us be." Excellent advice. I hope the committee up in Scandinavia is getting the prize ready.
KAMINSKI: Paul, here's a hit to the Senate Intelligence Committee, which this week came up with a sober and bipartisan report into the Benghazi attacks in 2012. Sober and bipartisan has not been the tenor of this debate over Benghazi.
I think they really laid out --
GIGOT: That's for sure.
KAMINSKI: -- the facts very usefully. They said the attacks were preventable. And they really have raised important questions about the way that the State Department and especially Hillary Clinton handled that episode before, during and after Benghazi. Get set to have a long debate over this in the run up to the 2016 presidential race.
GIGOT: Bret, briefly on yours, why did the Israelis apologize for the defense minister then?
STEPHENS: Well, it was, as they say, it was a gaffe, the unwitting speaking of truth. And they thought that is was a little too personal against Mr. Kerry.
GIGOT: OK, thanks.
And remember, if you have your own hit or miss, please send it to us at JER@FOXNews.com. And be sure to follow us on Twitter, I know you will, @JERonFNC.
That's it for this week's show. Thanks to my panel and to all of you for watching. I'm Paul Gigot. Hope to see you right here next week.
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