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"The Last Word": Carly Fiorina

Aired November 22, 2009 - 12:00   ET


KING: I'm John King and this is STATE OF THE UNION.


KING (voice-over): The magic number, 60.

DODD: The motion is agreed to.

KING: Senate Democrats clear a critical health care hurdle, but will differences within the party unravel the sweeping measure?

We'll go inside the deliberations with three leading Democratic senators: Sherrod Brown of Ohio, Michael Bennet of Colorado, and Jeanne Shaheen of New Hampshire.

And then in an exclusive interview, we'll hear the Republican reaction and strategy from Senate GOP leader Mitch McConnell.

And our "American Dispatch" from Arkansas, two small business owners showcase the policy divide that makes health care politics so dicey for vulnerable Democrats.

She was a top CEO and a leading adviser to Senator John McCain's presidential campaign, now she has her sights set on a Senate seat while fighting a very personal battle. Carly Fiorina gets the "Last Word." This is the STATE OF THE UNION report for Sunday, November 22nd.


KING: We begin this Sunday morning with the Senate's dramatic step to open debate on major health care legislation. It was a rare Saturday night session. And in the end, a big win for the Democratic majority, but just barely. Leader Harry Reid needed 60 votes and he got just that. All 58 Democrats and both independents voted aye on the motion to proceed. Every Republican voted nay.

Their leader will join us in just a moment for an exclusive conversation about the Republican strategy going forward, but first, the many challenges still ahead for the Democrats. Let's talk those over with Democratic senators Jeanne Shaheen of New Hampshire, Sherrod Brown of Ohio, and, in his first Sunday show interview, Michael Bennet of Colorado.

Congratulations are in order on this morning for the Democrats, but you got across the starting line. Let's talk about what it will take to get to the finish line. And the big divide in the party still is over the public option. Three supporters of the public option at the table here. But you saw Senator Lincoln of Arkansas says, I vote to go forward in this debate, I don't like the public option. Senator Landrieu, I don't like the public option, at least in its existing form. Senator Lieberman has said he will not vote for a bill that includes a public option.

Senator Shaheen, to you first. Will you have to get that up to get 60 in the end? You had 60 in the beginning, but to have 60 in the end, will you have to go to a trigger or some other form and give up what you would like?

SHAHEEN: You know, I support a public option. I think it's important for us to get competition in the health insurance industry so we can lower costs for people. But there are a number of ways to do that. We're at the beginning of this debate, and I think we've got to see how it plays out.

KING: Senator Bennet, you want to go home -- you're on the ballot next year -- you want to go home and say, we did this. It's -- not only is it important, not only did we debate it, but we passed it. Will you have to give that up to get 60 at the end?

BENNET: I don't know. My sense of it, John, is that people understand that there's a requirement in this bill that they have insurance. What they're saying to me is, even though they didn't say this early in the summer, what they're saying now is, I want all of the options. I want a public option, I want a private option, I want nonprofit. I want to be able to make the choice that's in the best interest of my family. I think other people are going to be hearing that too.

So I think last night was a big step forward, because it allows us to debate not just this issue, but a range of issues around health care that the American people, you know, deserve to have. As Jeanne said, after 50 years of delay, delay, delay, we finally now have the opportunity to debate these issues on the floor of the Senate.

KING: Let me try asking you it as a yes or no. If in the end, you cannot get Senator Lieberman, Senator Lincoln, Senator Landrieu, and you can't pass a bill without at least going to a trigger, would you make that compromise?

BROWN: I'm not going to answer yes or no, because I don't think we get to that.

I think what happens, John, is there are two weeks, three weeks, whatever, of debate. Senator Lieberman, everybody has a chance to offer amendments. I'm going to offer amendments on some pharmaceutical issues, because I think the bill could be strengthened there. I know that my colleagues are going to do the same on some other -- that and some other issues. So they will have their chance to do this.

And I think, in the end, I don't want four Democratic senators dictating to the other 56 of us and to the country, when the public option has this much support, that it's not going to be in it.

And I echo what Michael said, is that people want every option. If we're going to -- if we're telling people you have to buy insurance, we shouldn't tell them they've got to buy insurance from a private insurance company.

But in the end, I think that all four of our colleagues survey this -- look at this bill in the end and say, I don't think they want to be on the wrong side of history.

KING: Let's talk about how we pay for this. The Senate bill would cost about $850 billion over 10 years. Here's how it is currently paid for in the proposal before you. A 40 percent tax on so-called Cadillac insurance plans, those that cost over $8,500, $436 billion in Medicare savings or cuts depending on how you look at it, and we can talk about that. Increase in the Medicare payroll tax for those making over $250,000 a year, and a 5 percent tax on elective cosmetic procedures, already lovingly called "the botax" here in Washington, D.C.

As you know, a number of these proposals are quite controversial, and your friends in the labor movement particularly don't like the Cadillac insurance plan tax. Here's what Jim Hoffa, the president of the Teamsters, says. "This provision is really a massive tax increase on the middle class by calling it a tax on insurers. But it is naive to think that insurers won't pass this tax directly on to workers. The idea that this tax will curtail rising premiums is just dead wrong." Is Jim Hoffa right?

BROWN: Generally, he is.

KING: Will you fight that proposal?

BROWN: I would prefer that we look more at the version that the House did on a surtax on people making $500,000 a year or more. Even with the House proposal, and I know we're talking -- when you talk about either bill, but even with the House proposal, it's still -- the tax rate is still significantly less for upper-income people than it was before the Bush tax cuts for the rich that were unpaid for and caused this huge budget -- in part, with the war and the Medicare privatization, that caused these huge budget deficits.

And I know that Mitch McConnell, when he speaks after this, is going to spend a lot of time talking about the budget deficit.

But it's the Mitch McConnells of the world that voted for the war and didn't fund it, voted for the tax cuts for the rich and didn't fund it, and voted for the Medicare privatization and didn't fund it. That's why we're in this situation and the economy we have.

So it's just important as we listen to Mitch in the next segment that people kind of keep that as a...


KING: I will remind him of that point, but the Democrats are in charge now.

BROWN: I understand that. That's why we're...

KING: They have the White House and both branches of Congress.

BROWN: That's exactly right. We're in charge now. And Jeanne Shaheen and Michael Bennet and I, all of us, have made sure this bill pays for itself. We're embarking on something very new and very important, this health care bill. And we've all committed that it be paid for, something that hasn't happened in 10 years.

That is no longer business as usual. And that's why -- that's one of the reasons this bill is the right way to go.

SHAHEEN: And it's not just that it's paid for, it actually is going to reduce the deficit over the next 10 years by about $130 billion. That's real progress.

KING: And to make that happen, if you read the Congressional Budget Office analysis, if you talk to interest groups around town, even those who support you, academics, they say you have, you know, the $400 and something billion in Medicare savings. And some people call it cuts, other people say this is waste, fraud, and abuse, let's make a run at this.

But what we do know will happen is that next year and the year after, whether it's the hospitals, the hospices, the senior groups, will come back saying, this is too hard on us, this is too hard on us, give us some of that money back.

Will you all commit today that if you pass this bill and it sets that target to save in Medicare, that you'll say no when they come back? And you may have to cast the tough votes against your friends saying, no, we committed to doing this, it is the key to bending that curve, and you will make the tough votes?

SHAHEEN: But, listen, I think there's a lot of misinformation about where the cuts from Medicare are going to come from. They're basically from two places. One is we're going to make private insurers who offer Medicare Advantage plans pay the same amount that everybody else is getting under Medicare. There are significant savings there.

And then the hospitals have said, we're going to be able to charge less for Medicare, because we're going to have a lot more patients, because a lot more people are going to be insured. And then there's a third provision that I think is reflected in a number of ways in the bill that Michael and I have been working on, which is hospitalizations, and making sure that people on Medicare, when they're let out of the hospital, are able to stay out because they've got better transitional care.

BENNET: I would say, John, I think it is critically important that we maintain the fiscal discipline that's represented by this bill. We maintain it as the bill works its way through the floor and also in the years to come. Because one of the things that people are really cynical about here is whether Washington actually can pass a piece of legislation and pay for it.

You know, they're worried about -- they don't like the existing health insurance system, that's clear, but they're very worried about our capacity to make it even worse. And so for those of us that are proponents of reform, I think we carry a heavy and very appropriate burden to make sure that we really are paying for it, not just in the near-term, but in the out-years as well.

BROWN: And there are a number of components to this bill that aren't even counted in terms of cost savings, the discharge procedure, the first 30 days out of the hospital that Michael and Jeanne -- or that several are working on in the Senate, where a dietitian or a nurse or some home health care person spends -- monitors and stays with those people in those 30 days, continues to talk with them, that's not reimbursed now.

And there are ways of doing that. That will save a lot of money. The checklist that the physician at Johns Hopkins, Peter Pronovost, developed that saved hundreds of millions of dollars in Michigan. That's not counted in the savings.

All the wellness and prevention parts of the bill that Senator Harkin wrote in our Health, Education, Labor, Pension Committee that Michael and I sit on, all of that will be additional cost savings that are not so-called scored, too much inside-the-Beltway...


KING: Let's take a quick break -- let me take a quick break, we'll be back. Plenty more to talk about with our senators about what's in the health care bill for you. Don't go anywhere.


KING: We're back with Democratic senators Jeanne Shaheen of New Hampshire, Sherrod Brown of Ohio, and Michael Bennet of Colorado.

Let's talk about another tough issue in the health care bill. And Senator Bennet, I was listening yesterday on the floor when you were talking about your views on this, and that is, how should abortion be dealt with national health care reform?

I want to show our viewers, here's what the Senate bill before you right now does. It bars the use of federal funds for abortion coverage. The public man that would be created could provide abortion coverage, but money from the premiums must cover the procedure, not tax dollars.

The exchanges that would be created in each state must have one plan that includes abortion coverage and one that does not. And people who receive federal subsidies to buy insurance could choose a health plan that covers elective abortions. But, again, the private insurance would have to make sure that money comes from premiums, not federal tax dollars.

Here's what the House bill does in contrast. It is much more restrictive on this issue. It bars the use of federal funds for abortion coverage. The public plan would not provide abortion coverage. And private plans in the health care exchanges could not provide abortion coverage. People who receive federal subsidies to buy insurance could not choose a health plan that covers elective abortions.

I heard you on the floor yesterday saying the House goes too far. Again, in the end, would that be a make or break for you? We're going to have to cut a deal at some point if you get this bill through the Senate. And some people say, oh, if there's no public option, that's not good enough, I'll walk away. What about on abortion?

BENNET: I don't think there's any reason to change what the long-standing policy has been from the federal government about...

KING: But what if the reason is, you don't get a bill unless you do?

BENNET: I think -- I don't know, John. I don't think we will get that bill and I think that it would be very unfortunate if we did. We shouldn't be using health care reform to rewrite long-standing policy from the federal government on abortion. It's just not right. It's not the place we should be doing it.

I think the Senate bill strikes a very good balance. It's the balance that we've had for many years around this issue. And I think there are also very important things in the health care legislation that deal with long-standing issues around discrimination against women in a way health care is provided and insurance is delivered.

And I think that's where we should end up. I don't see a reason to be where the House is on this issue.

KING: Well, let me talk to you about the process a little bit. If you look at the front page of The Washington Post today, "Sweeteners for the South." To get Senator Landrieu's vote, just to proceed, just to go across the starting line, language was inserted in the bill that gives her state up to $300 million. To get Senator Nelson's vote, the leader agreed to drop a request that you take away the antitrust exemptions for insurance companies.

This got us to day one of the debate. Is this the way to do things? The central promise of the Obama campaign was to change the way Washington works. That's Washington as usual, is it not?

BROWN: It is and it isn't. I mean, I -- this bill is extraordinarily complicated.

This legislation is -- you know, as Jeanne said at the outset of the show, 50 years, you could maybe even say 75 years -- Franklin Roosevelt attempted it, Harry Truman really attempted it in earnest...

KING: But is it important enough to buy votes?

BROWN: I don't say it that way. I think there are a lot of things that we all go to the leader and talk about things in our state. And news reports sometimes aren't accurate about what might have been done for somebody or what might not have been done for somebody.

I want to see this bill pass. Nobody likes these kinds of -- any kinds of deals. I think anything that's done needs to be in the best -- in the best interest of those states and this country. I think those probably helped, if that, in fact, really happened -- I have no way of really knowing if it did. I suppose that helped a lot of people in Louisiana that don't have insurance, and so I think we move forward.

We do what we need to do, within ethical bounds. We do what we need to do within practical bounds. Keeping this, as we've all said, keeping this bill, keeping the costs down and keeping this bill budget-neutral or better, as Jeanne points out.

KING: Does it make it harder to do that? Does it create a climate if you're on the fence, legitimately on the fence, you think, all right, well, maybe I want to be a good Democrat and swallow my pride or swallow an issue or two and vote for this in the end, but I'm going to get something for it, and that's going to cost money? SHAHEEN: Listen, in the end, this is going to be a compromise. It's not going to be a perfect bill, but it's going to be a very important starting point. And I think it's important to point out that this bill is not just about how do we deliver health care in a way that is more cost-effective, because families can't afford it anymore, business can't afford it anymore, and the economy can't afford it.

But it's also about how do we do it in a way that improves people's health and their lives. And, unfortunately, we're spending more money right now on health care in this country than any other industrialized nation. And yet, we're not healthier. And so we've got to change the way we do things. And that's what this legislation is about.

BROWN: John, 400 Ohioans every day are losing their insurance. And you know, the Republicans, it was amazing last night, 39 Republicans, every Republican that voted, said, we shouldn't even debate this. We shouldn't even move forward. We shouldn't even have a chance to go to the floor and offer amendments to improve it. 400 Ohioans every day. You know, dozens of Coloradans and New Hampshire -- people in New Hampshire -- I mean, we need to do this, and we aren't hurrying it. We've taken the whole year, and not to mention 75 years, and this is done right, and we need to do what we need to do to get this bill enacted, and it's just so important.

KING: We saw this week how hard it will be to bend that cost curve in the example of when the mammogram study came out and the pap smear study came out, and you had groups outside of the government but affiliated with the government saying, change the policy on mammograms. Make it 50, not 40 for the screening, the pap smear thing. Do you believe -- use this dustup as an example -- when it comes to evidence-based medicine, comparative research, that we need -- do you believe we need that to bend the cost curve, but what's going to -- it's going to be men for prostate next, or somebody's vision test after that? BENNET: I do, and I think that we've got to -- this bill does a very important thing, which is it gets some of those decisions out of the hands of Congress. You were just talking about how, doesn't this look like it's the same old thing? You know, the same old political, inside-Washington, D.C. special interest game? And it does look like that to a lot of people. This has been about moving the ball down the field, getting through to a place where finally we can now debate the bill comprehensively, end to end, and Americans can see whether or not this is something they want to support, which I think is great.

And I think it's very important as part of that, that we get, for example, out of the hands of Congress, making these decisions on a one-off basis about how people are reimbursed, for example, for oxygen. I mean, you can imagine what lobby day looks like for oxygen in the United States Congress. People come in and say, you should use this much oxygen at that price. It has nothing to do with patients, it has nothing to do with the quality of care, or comparing a certain kind of treatment in one place to another. And I think that if we can establish an infrastructure to really do that in a thoughtful way over time, not only can we bend the cost curve, we can take the politics out of it, and the quality of care will improve as well.

KING: I want to move on to some other issues. Before I do, I want to try one yes-or-no question on you, a new senator who's on the ballot next year in a tough state. If you get to the final point and you are a critical vote for health care reform, and every piece of evidence tells you, if you support that bill, you will lose your job, would you cast the vote and lose your job?


KING: All right. That tape will be held -- I hate to tell you that, but that tape will be held right now.

I want to move on. There's a lot of criticism this week. We saw unemployment in 29 states went up. In two of your states, it went down a little bit. In one of your states, it went up a bit. In 29 states, the unemployment rate inched up again. And there's been a lot of criticism of the president's economic team, including from Peter DeFazio, who is a Democrat. And he said this, Congressman Peter DeFazio. "It's pretty embarrassing for a Democratic administration and a Democratic Congress to be identified with total attention to Wall Street and nothing for Main Street and jobs. I still support the president, I just think he's being poorly served by his economic team."

Some Republicans went further and said Secretary Geithner should resign.

Is this administration and its economic team in touch, in sync with the people of Youngstown and Cincinnati and Cleveland at this moment, or more in touch with Wall Street?

BROWN: I think the president is. I think that the vice president is. I think the advisers are mixed. I spoke with secretary -- I was with Secretary Geithner at the Treasury Department this week at the small business summit, Senator Warner and I with a bunch of small-business people with Karen Mills, the administrator of SBA, and Secretary Geithner. And I took him aside and said, we need more focus on manufacturing, we need an industrial policy. Manufacturing creates middle-class jobs, and there's not been the -- there's not been a manufacturing policy in this country for forever, really. And the former presidents haven't had it, and -- and President Obama's moving in that direction. I mean, Ron Bloom and others in the administration really are beginning to focus on that. So I think they've turned a corner. I think, particularly next year, the focus is all about creating jobs, and I think we'll begin to see changes.

BENNET: What's staggering to me about this is it's not just that we're in the worst recession since the Great Depression, although we are. It's also that in the last period of growth, working families income in the United States actually declined during the Bush recovery. So our working families are trying to recover not just from one recession, but two. This is not just a short-term issue about stimulus. It's a long-term issue about where we're headed with this economy. And I think we do need to turn more of our attention to that. I think we need to do much more to get small business access to loans again so they can start hiring again. We haven't done a good enough job at that. We really do need to turn our focus in a very meaningful way to Main Street.

KING: And as he makes that point, he says we, he's being polite. Does the president's team need to do a better job?

SHAHEEN: Sure. I think we all need to do a better job. I voted against the TARP funding because I thought we weren't holding the financial community accountable enough for how that money was being spent. So I think we've got to look now at what more we can do.

Both Sherrod and Michael made the point, we need to make sure business gets access to credit. We need to have a manufacturing policy. We need to do more to give business access to international markets so that they can export more.

So there's a lot more we need to do. We need to invest in our infrastructure. And I think the president and his economic team recognize that. And we've all got to work together and work harder.

KING: Senator Shaheen, Senator Bennet and Senator Brown, thanks for coming on this Sunday morning. We appreciate it.

BROWN: Thanks, John.

SHAHEEN: Thank you.

KING: We'll continue the conversation. We've got a long way to go, here, on both the health care and the economic front.

And up next, the Republican perspective on health care, Afghanistan, and more from the Senate Republican leader Mitch McConnell. Stay with us.

(COMMERCIAL BREAK) KING: With us now With us now exclusively, the Senate Republican leader, Mitch McConnell of Kentucky.

Mr. Leader, thank you for joining us. You don't like the way the vote went down last night. You were on the losing side.

Now that the Democrats have 60 votes to start debate -- a long way to go, a lot of issues to debate, but do you believe, like it or not, that that vote means that the Senate will pass and the Congress will send to the president a health care bill late this year or early next?

MCCONNELL: Yes, not necessarily. First of all, we'll have an extensive debate. The Senate's not like the House. They had three votes on one day and it was over.

Just to look at recent legislative activities on the Senate side, we spent four weeks last Congress on a farm bill, seven weeks creating the Department of Homeland Security a few years ago, eight weeks on an energy bill. The Senate doesn't do things quickly.

So we'll have multiple amendments, John, from both sides, a free- ranging, open debate. And as we begin the debate, the one thing we know for sure, that didn't come up in the last segment -- I know why it didn't; they don't want to talk about it -- we know the American people don't want us to do this.

The CNN poll is the same as all the other polls. The American people are opposed to this particular health care bill. They thought this was all going to be about controlling costs, but, in fact, we've ended up with a $2.5 trillion budget-busting proposal that CBO, the scorekeeper in Congress, tells us, after it's all over, will not control costs.

KING: The scorekeeper does say, after 10 years, it brings down the deficit, if the Democrats cast all those tough votes.

MCCONNELL: Yes, but, you know, it was full of gimmicks. They delayed for five years the benefits. If you look at 10 years for the whole program fully implemented, it's $2.5 trillion.

So this proposal picked the most favorable 10-year period in order to get the CBO to say, within this framework, it would actually bend the deficit some. But that -- it's not the truth. I mean, everybody knows it's not the truth.

KING: Is the Republican strategy just get in the way and block it? Or is the Republican strategy, try to improve it and then maybe vote yes on a final bill that you don't like some of it, but it's better than today?

MCCONNELL: Well, this bill is certainly not better. It drives the costs up for Americans; it cuts Medicare dramatically.

KING: Now, the Democrats say it saves Medicare, but it doesn't cut a benefit. MCCONNELL: Yes, let me tell you, five years ago we passed, when my side was in the majority, a rather modest reduction in the rate of increase of Medicare, at about $10 billion over five years. My counterpart, the majority leader, called it immoral. This is half a trillion dollars over 10 years, higher taxes on individuals and on businesses, higher insurance premiums for 85 percent of the American people who already have insurance.

That's not reform. That's not what the American people thought this was all about.

KING: Answer the skeptic out there who's watching right now. You just made the point. You were the majority leader. The Republicans ran the Senate; they ran the House, as well, and you had a Republican president in the White House in George W. Bush.

Answer the skeptic out there who says, well, why should I listen to you now, Mitch McConnell? Where was the McConnell bill to deal with pre-existing conditions? Where was the McConnell bill -- as Republicans say, let's do this; let's sell insurance across state lines -- where was the McConnell bill to help bend that cost curve in a helpful way? So how can you say no now, when you didn't -- and say, let's do this incrementally now, when you didn't do it then?

MCCONNELL: Well, we didn't have the votes to pass it. They were against doing something about junk lawsuits against doctors and hospitals which would save $54 billion. They were not in favor of the kind of wellness programs that we think would drive down the costs. They were not in favor of insurance competition across state lines. They were not in favor of equalizing the tax cod, so that individual purchasers of insurance are treated the same way corporate purchasers of insurance are.

KING: Again, the skeptic might say, why didn't we have all these issues on the floor, though? Harry Reid may lose this. He may lose this.

MCCONNELL: We had myriad health care debates during the period that President Bush was in office and during the time when there was a Republican majority. The Democrats simply don't want to do incremental changes.

John, we feel that we ought to go step by step to fix our current health care system. We do not believe, take -- the government taking over one-sixth of our economy, completely restructuring one-sixth of our economy is a good idea at any time. It is a particularly bad idea when we're looking at double-digit unemployment.

This bill is a job-killer. If you were running a small business, John, and you wanted -- thinking about whether or not to expand employment next year, and you looked at what's coming your way with this health care bill, you're going to have health care taxes, you're going to have expiration of the Bush tax cuts, so your tax rates are going to go up. The cost of hiring additional employees will be greatly exacerbated by the steps that they're taking. This is the wrong direction to go. KING: And you mentioned you would prefer incremental reform. I want to ask you a question in the context of what you know is coming from the Democrats over the next several weeks as this debate goes on. Leader Boehner was here a few weeks ago; he heard it in the House. Senator Durbin and the Democrats say, Well, we have a plan. Maybe it's not perfect, but where's the Republican plan?


DURBIN: I challenged Mitch McConnell and the Senate Republicans to produce a health care bill that will save us $127 billion in the deficit over the next 10 years, and there's nothing posted on the Internet. I challenged Mitch McConnell to come up with a bill that makes sure that 94 percent of Americans have the peace of mind of health insurance coverage, but the Republicans put nothing on the Internet.


KING: Will you continue to say, "We want to do this incrementally," or will, because of the politics of the moment, do you feel compelled to come up with a comprehensive Republican alternative?

MCCONNELL: Yes, what we don't think is America wants another 2,000-page bill. It's this high. We had it on the floor. We don't think that's the way to go. We think we ought to go step by step to improve the -- the system that you and I have just been talking about, some of the steps we would take that would have an impact on the cost of health care.

The American people are not complaining about the quality of American health care. They're complaining about the cost of it. This proposal that the Democrats voted to proceed to last night will explode cost; it will make the situation worse.

MCCONNELL: We think you ought to go in a different direction.

So don't hold your breath. We're not planning on having a 2,000- page bill.

KING: Let me -- well, before I shift gears, let me ask you this. You've been at this a long time, both as the majority leader and as a minority leader. On a scale of 1 to 10, the likelihood the Senate will pass a health care legislation this year and that Congress will send the president a bill before the State of the Union Address next year?

MCCONNELL: Well, we don't often ignore the wishes of the American people. They are literally screaming -- many of them -- telling us, please don't pass this, don't pass this bill. If the majority is hell-bent on ignoring the wishes of the American people, they have 60 votes in the Senate.

You would think that they might be able to do this, but I believe there are a number of Democratic senators who do care what the American people think and are not interested in this sort of arrogant approach that everybody -- sort of shut up and sit down, get out of the way, we know what's best for you.

Now, we're hearing from the American people, they don't want us to pass it. So I would -- you know, it's hard to handicap the ultimate outcome, whether the majority will ignore the American people or not, but they'll be heard. The American people will be heard. They'll either be heard sooner or they'll be heard later.

KING: Let me shift to the economy. Unemployment went up in 29 states this week, down in 13. I've traveled to 45 states in the last 45 weeks. And as much as they care about the health care debate, they care, first and foremost, about jobs and the economy.

There has been a lot of criticism of the president's economic team, including from a House Republican who said this week the secretary of the treasury should quit. Let's listen.


REP. KEVIN BRADY (R), TEXAS: Conservatives agree that, as point person, you failed. Liberals are growing in that consensus, as well. Poll after poll shows the public has lost confidence in this -- in this president's ability to handle the economy. For the sake of our jobs, will you step down from your post? (END VIDEO CLIP)

KING: Now, Secretary Geithner, of course, says no. Are you among those who think that he's the problem? Does he need to go? Or is that just a little political pinata?

MCCONNELL: You know, look, I'm not here to call for anybody's resignation today. I think we ought to go in a different direction.

First of all, we ought not to pass this job-killing health care bill; that would be a good place to stop.

Second, we ought to repeal the balance of the stimulus package, which has been a failure. We added almost $1 trillion to the debt earlier this year, presumably to hold unemployment below 8 percent, which is what the administration said it would do. Now unemployment is over 10 percent.

In my state, John, it actually went up last month, unemployment getting worse. Rather than passing this job-killing health care bill, why don't we concentrate on getting the economy in better shape?


KING: Up next, a quick check of today's top headlines, then, she was a top adviser to Senator John McCain's presidential campaign, now she wants to represent California in the United States Senate, former Hewlett-Packard CEO Carly Fiorina gets the "Last Word" next.


KING: I'm John King and this is STATE OF THE UNION. Here are stories breaking this Sunday. The death toll rises. Chinese media say 92 people have died in a coal mine explosion in the northeastern part the country. And a rescue effort is under way still for another 16 workers trapped underground.

It has been three days and students are still occupying an administration at the University of California Santa Cruz over fee increases. They expect the police will soon forcibly remove them.

Those are your top stories this hour here on STATE OF THE UNION. And up next, we will talk to the woman who wants to be senator from California. former Hewlett-Packard CEO Carly Fiorina gets the "Last Word," next.


KING: Eighteen newsmakers, analysts and reporters were out on the Sunday morning talk shows but only one gets the last word. And that honor today goes to Carla Fiorina. She's the former CEO of Hewlett-Packard and now a Republican (inaudible) -- Republican candidate for Senate in California.

I'll eventually speak English.



FIORINA: Thanks, John.

KING: I want to ask you -- you're a Republican candidate for Senate, so let's imagine you are the Republican senator from California. A big vote last night in the United States Senate. The question is, do we start debate on health care reform?

How would you have voted it?

FIORINA: I would have voted no. And I don't think that's a partisan comment. I think, if you just look at the facts of this bill, the facts, which are nonpartisan, are terrible. The CBO says this bill will not decrease insurance premiums; it will raise them. The CBO says that this will cost $2.5 trillion.

In essence, it's a business case that front-end-loads the revenues and back-end-loads the costs. I used to see those as a businessperson; I'd throw them out because the numbers don't add.

And as a breast cancer survivor, I have to tell you I'm extremely concerned by the example that the recent change in mammography guidelines indicates, rationed care, what that will mean for women in this country.

KING: I want to spend more time on that at the end of our conversation, but on the substance, the bigger substance of the health care bill right now, when you say CBO says it would raise premiums, I assume you mean the section where says -- talking about the public option, if that is created, CBO speculates that sicker people would get into the public option, and therefore you'd have a pool of sicker people, and premiums might go up. Is that the part you're talking about? FIORINA: That is exactly right. And also, the CBO also says that we're leveling tens of billions of dollars onto American businesses, and the CBO acknowledges that the costs of that tax burden will probably be paid by workers, either in wages or in jobs.

So all the facts about the money of this bill are terrible. We're not solving the problem. We're not bending the health cost curve down. We're not helping the American people.

And, oh by the way, there's this little thing called a $12.5 trillion, $12.4 trillion deficit at this point.


We can't afford it. It doesn't solve the problem.

KING: You list a number of policy reasons. There would be some that disagree with you, but you list all the policy reasons. What about the political calculation, because Carly Fiorina is running to be a United States senator from the state of California.

And the Los Angeles Times did a poll recently with USC, and they said, "Do you want a senator who will mostly support President Obama's policies?" And nearly 6 in 10 Californians, 59 percent, said yes. The answer you just gave me was no. Do you worry about that?

FIORINA: Well, you know, it's interesting. Because, if you listen to what President Obama said about this health care proposal, even he agreed with me. He said he wouldn't sign into law a bill that increased the deficit. He said he wouldn't sign into law a bill that increased the cost of health care. If this bill goes through, President Obama will have to eat his words or break his promise.

I agree with the goals of health care reform. What I strenuously disagree with is that this bill or the one that made its way through the House solves the problem in any way.

And I also think you'd find it interesting that, in California, the independent vote, which will be critical, as it has been in Virginia, New Jersey and other places -- independents are basically saying they don't want Barbara Boxer back in the U.S. Capitol; they'll take almost anybody instead of her.

KING: We'll watch the health care debate, and we'll come back to the mammogram issue in a minute.

But another question that Senator Boxer could end up voting on in the near future, and you would vote, if you were there instead of her, is how to fund the wars in Iraq and Afghanistan.

Carl Levin is the chairman of the Armed Services Committee. And he says it's time to make this more transparent, to give the American people a more open assessment and accounting of how much this costs overseas. So what he says is, let's have a war tax. Let's listen.

(BEGIN VIDEO CLIP) SEN. CARL LEVIN, D-MICH.: I think the finer way to pay for it -- I don't know that it has to be a war tax, but I think we've got to find revenues, particularly in the upper brackets, folks earning more $200,000 or $250,000 -- they have done incredibly well. And I think that it's important that we pay for it if we possibly can.


KING: Is that the way to do it, some new revenue stream dedicated solely to paying for the wars, or should it come out of general fund as it does now?

FIORINA: Well, first let me point out that a new tax has nothing to do with transparency. I'm all for transparency. I think every bill ought to go up on the Internet for public comment. I think every budget ought to go up on the Internet for public comment.

However, to say that we're going to pay for the war with a tax on the rich ignores the fact that we know that doesn't work.

California is a test case of how big government, big tax doesn't work. California, right now, has huge government, and yet the quality, the services, the government produces is deteriorating; higher and higher taxes. And the consequence of that kind of regime is we are losing more and more jobs in California, losing more than we're creating. And, in fact, the tax bases are eroding. It doesn't work.

So, no, I think it's a bad idea.


KING: And what about -- the question at the core of that is, the president's likely to send more troops to Afghanistan. Should he send more? Should he send 20,000, 30,000, 40,000, or enough?

FIORINA: You know, I agreed with the president's strategy when he laid it out for Afghanistan. And what he fundamentally said was, Afghanistan and Pakistan are inextricably linked. I agree.

What he fundamentally said was economic development and diplomacy were as important as military power, I agree. And what he said was, I'm put a new general in charge to lead our military efforts.

My own view is you either accept that general's recommendations at this point or find someone else. But I think trying to change his mind about what he thinks he needs is a recipe for failure, not victory.

KING: Much of the country is captivated, and certainly the political parts of the country are captivated by the Sarah Palin book, right now.

She was, of course, the Republican vice presidential nominee. You were a senior economic adviser to the John McCain campaign. I want to read something she writes in that book about the economy. "It would later concern me that, when the tanking economy began pushing the war out of the headlines, Steve Schmidt" -- the campaign manager -- "was slow to turn the campaign ship into the wind. It seems clear that there was an assumption at the center of the McCain camp that the war would retain center stage come hell or high water."

Is Governor Palin right? Was the campaign too focused on Iraq, too focused on military strategy and not concerned enough about dealing with the economy?

FIORINA: You know, I haven't read her book, but I guess my own experience -- I signed on with John McCain early on in 2007. And all of my conversations with him were about the economy, for essentially two years, and all of my conversations with the campaign were about the economy.

KING: All politics is local. Let me ask you a California question. Those students -- we just talked about them. They're staging a sit-in, right now, at the university of California-Santa Cruz.


They've had 32 percent tuition and fee hike. They think that's an outrage, and they're staging this sit-in.

Number one, are they right? Do they have every right to be outraged?

And, number two, would you, as a senator, support the governor or anybody in local authority sending the police in to forcibly remove them, or should they be heard?

FIORINA: Well, A, I think they should be heard. And, B, of course it's an outrage. I mean, how do you say to their students and their parents, "Surprise, you're going to have a 32 percent increase," just as it was outrageous to say, "Surprise, we're going to pay you back with IOUs."

But, again, California is a test case of the fact that bigger and bigger government and higher and higher taxes just don't work.

We are now facing, as a nation, an unsustainable deficit. There are only two things that can be done to bring that deficit under control so that we don't leave our children and grandchildren with unsustainable levels of debt.

We have to grow the economy and we actually have to reduce federal government spending. And those two platforms are what I will run on. And those two issues, interestingly, are the number one issues for the people of California, regardless of party affiliation.

KING: I want to circle back to your personal experience and how it relates to the health care debate. You mentioned this advisory panel came out with these new recommendations, saying, no longer should women start getting mammograms at 40; move it up to 50, because their calculation was -- and they spelled it out pretty plainly. They said going at 40 does save some lives, but they also think it had caused unnecessary grief, unnecessary stress, some unnecessary testing. FIORINA: Well, first, the panel was specifically asked to look at costs as well as care. Secondly, the panel did not include an oncologist or a radiologist; that is, people who know something about it.

Breast cancer is among the most common forms of cancer among women and among the most curable. In my own situation, I found my own lump two weeks after a clear a mammogram. Had I followed these new recommendations and not received another mammogram for two full years -- I'm over 50 -- I could well not be sitting here.

The truth is all of these preventive techniques, self-exams, mammograms, MRIs when necessary -- in my case I had to have several -- are saving lives.

Who is to say that a nameless, faceless bureaucrat government in Washington, D.C. should determine that my life is too expensive to save?

KING: Then who is to say, though, to your point -- because if the goal of health care reform is to control costs, somebody, something has to regulate -- "We're doing too many of this test, too many of that test."

Somehow, you have to control costs, do you not?

FIORINA: Well, you know what, first the decisions about care should rest between a patient and their doctor, the people who know the science. Secondly, if we would focus more on quality of care, we would lower costs. That has been proven over and over again.

In the places where people are focused on, for example, integrated patient care, costs are lower. Patient-centric care, costs are lower. If we're really interested in lowering costs then let's pass the kind of medical malpractice reform that we passed in California. It saved money. It lowered insurance premiums. It would save probably $54 billion here nationwide. I don't see this debate really focused frankly on the real issues: quality, and let's make sure that everyone is covered.

Sadly, we have a business case that doesn't add up. Quality isn't going to be improved. And costs are on the rise.

KING: Carly Fiorina, a Republican candidate for Senate of the state of California, we appreciate your coming in here today for the "Last Word."

FIORINA: Good to be with you, John.

KING: We'll come out to the West Coast and watch the campaign as it plays out.

And up next, Democratic Senator Blanche Lincoln was the critical 60th vote to move the health care debate along. When we come back, we'll take you to her home state of Arkansas and show you how that vote just might cost Senator Lincoln her job. (COMMERCIAL BREAK)

KING: We've been talking most of the hour about health care and the tough policy and political choices the congressional debate is forcing. Those feeling the most pressure are those who face the voters next year. Perhaps none more than the woman who cast the 60th vote, the decisive vote to go forward with the debate. She is Senator Blanche Lincoln of Arkansas. She served two terms in the House, now she is in the United States Senate. She is on the ballot next year.

In our "American Dispatch" this week, we traveled to Arkansas for an up-close look at how the state's conservative politics factor into the health care debate and Senator Lincoln's re-election hopes.

(BEGIN VIDEOTAPE) KING (voice-over): Aisha's Fish and Chicken is a family business, known for its friendly service.

STANLEY WALKER, OWNER, AISHA'S FISH AND CHICKEN: We're going to hook them today, huh?

KING: Wings and catfish.

WALKER: A five-piece wings, extra sauce on it.

KING: And a spicy signature sauce.

WALKER: 131.

KING: Tough times in a bad economy, so owner Stanley Walker says health care is out of the question.

WALKER: It's too expensive right now. We're kind of having a little bit of trouble keeping our head above water.

We had it at one time, but it was so expensive that we finally dropped it. I get a lot of complaints from my wife about it that we don't have health care.

UNIDENTIFIED FEMALE: Five-piece, no sauce.

KING: It is both a business decision and a personal risk. Stanley has diabetes and takes just half of his four-pill a day prescription because he can't afford the $500 a month bill for the full dose.

WALKER: Because I work by myself a lot and I'm always moving all the time, I don't want to get somewhere and go into a coma, you know, because my sugar dropped too low. It's a situation where you actually take a gamble, but you can't afford not to.

KING: Stanley hopes Congress makes it makes health care more affordable and thinks creating a new government-run public option is the best way to do that.

WALKER: If they don't do that, then I don't think I will vote for them. KING: It's an important statement because African-American votes in places like Pine Bluff will be critical in next year's midterm elections. And Democratic Senator Blanche Lincoln faces a tough re- election race.

PROF. ART ENGLISH, UNIVERSITY OF ARKANSAS AT LITTLE ROCK: No question they see an opportunity here and an opportunity to win a Senate seat doesn't come often for Republicans in Arkansas.

KING: Senator Lincoln opposes a public option, and while that angers liberals, political scientist Art English says Lincoln needs to worry about conservative Democrats and independents in a state President Obama lost by 20 points. ENGLISH: It's tough. It's like that show, "Malcolm in the Middle," but this time it's kind of, you know, Senator Blanche Lincoln in the middle, and it has been tough on her.

KING: Larry Levy owns this Little Rock brake shop, and has gone from paying 100 percent of employees' health care to 60 percent.

LARRY LEVY, OWNER, STUART'S BRAKE SHOP: It kept going up and as my employees got older, the premiums, they began to get so high we just couldn't realistically afford it.

KING: But Levy sees disaster in Democratic plans to create a public option or a mandate that everyone buy health insurance.

LEVY: We don't know what it's going to cost us. We have health issues, I agree. There needs to be reform. But let's identify the problems that we have and let's fix those problems. Let's just don't throw out everything and start all over.

KING (on camera): They say that if taxes go up, it will only be on people above 250 grand a year, but you don't buy it?

LEVY: No, no, I don't. I don't buy it. We middle-class people will shoulder the burden. I have no question about that.

KING (voice-over): Levy describes himself as a conservative who did not vote for Mr. Obama, but does sometimes votes for conservative Democrats. He is not a fan of Senator Lincoln.

LEVY: She is playing games right now, I think, you know? She is just kind of swaying back and forth. I know she's in a tough position, but if she'll listen to her constituents we don't want her to vote for this, I think.

KING (on camera): You think that she has -- she had better listen?

LEVY: I think she needs to listen if she wants to keep her job, yes.

KING (voice-over): But Levy says Lincoln has already lost his vote. He sees Washington as veering too far left and sees the midterm elections as a chance to vote Republican and put the brakes on the Obama agenda.


KING: Our thanks to the people of Pine Bluff and to Little Rock for opening their homes and their businesses to us. Arkansas is a great state and has fascinating politics. We'll keep an eye on that race.

But as you know, one of our goals is to get out of Washington as often as we can. We've made it our pledge here on STATE OF THE UNION to travel to all 50 states in our first year. So far, we've been to 45, including Arkansas, Alabama, and Vermont, and many in between. Check out where you can take a peek whether we've learned when we've visited your state. We'll be right here again next Sunday and every Sunday at 9:00 a.m. Eastern for the first and last word in Sunday talk. Until then I'm John King in Washington. Please take care.

For our international viewers, "AFRICAN VOICES" is next, and for everyone else, FAREED ZAKARIA: GPS" starts right now.