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THE SITUATION ROOM

Interview With President Obama

Aired August 16, 2011 - 18:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


WOLF BLITZER, CNN ANCHOR: And to our viewers, this is a special edition of "THE SITUATION ROOM." We're in Iowa with the president of the United States. Happening now: President Obama talking one-on-one with me about jobs, the desperate need to create them for millions of Americans and his effort to hold on to his own job.

Also, the president responds to controversial remarks by would-be Republican rivals Rick Perry and Mitt Romney, including one comment that some see as disrespectful to the president.

And we talk about terrorism. As the world prepares to mark 10 years since 9/11, the president says that kind of spectacular attack may not be the biggest threat right now.

We want to welcome our viewers in the United States and around the world. Breaking news, political headlines and Jeanne Moos all straight ahead. I'm Wolf Blitzer. You're in THE SITUATION ROOM.

President Obama on a bus tour through the United States Midwest. He has been reaching out to rural voters, but he took some time today to sit down with me for a wide-ranging one-on-one interview.

We talked about the political gridlock in Washington, the field of Republican challengers trying to oust him from the White House, and the terror threat a decade after 9/11.

But we began with what may be the most pressing issue facing the country right now.

Here's part of my interview with the president of the United States.

(BEGIN VIDEOTAPE)

BLITZER: Mr. President, thanks very much for joining us.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Great to be here.

BLITZER: All right, let's talk about jobs, jobs, jobs, issue number one. You are going to release a major new jobs program, you say, in September. Here's the question. What's taken so long?

OBAMA: Well, the truth is, everything we have done has been related to jobs, starting back with the Recovery Act. And that's the reason why we have seen over two million jobs created over the last 17 months in the private sector. But what's happened is that, number one, you have seen a lot of layoffs at state and local government. And that has been an impediment to the kind of robust job growth that we'd like to -- we'd like to see; and there have been some headwinds over the last six months, you know, Japan's tsunami, the European debt crisis, what happened in terms of the Arab Spring that raised gas prices for consumers, so...

BLITZER: So give us a preview what you're going to do in September.

(LAUGHTER)

OBAMA: Well, look, there are some things that we've been talking about on this trip that we could do right away that are already pending before Congress.

We know that what we did in December by cutting the payroll tax so that the average family gets an extra thousand dollars in their pocket makes a huge difference, not only for their purchasing power, but also businesses having more customers and being able to hire.

We've continued to renew tax breaks for businesses that are willing to move up investments that they're planning into 2011, and we'd like to renew some of those for 2012.

Trade deals with Korea and Panama and Colombia, we know can create tens of thousands of jobs here in the United States.

So there are a number of things that we've already got pending before Congress, and what I have been saying to crowds all across the country -- it's been getting a good reception -- is what they want to see is Democrats and Republicans putting country before party, and going ahead and taking action in terms of move the economy forward as quickly as possible.

BLITZER: But you've got something much more ambitious in mind for this September. There's been reports you want to create a new department of jobs, something along those lines. Is that true?

OBAMA: You know, that is not true.

But what is true is that I think we missed an opportunity a month ago when we could have dealt with our debt and deficit in a serious, balanced way that would have avoided these huge gyrations in the financial markets, given businesses a lot of confidence that Washington had its fiscal house in order, and included in that, because of the savings that we'd be getting over the next 10, 20 years, more efforts on the front end to spur job creation.

And given that Congress failed to act, the grand bargain that I was trying to cut with John Boehner didn't happen, we're going to take one more run at Congress, and we're going to say to them, look, here is a comprehensive approach that gets our debt and deficits under control and also accelerates job growth right now.

BLITZER: Is this an initiative you're going to give to the so- called super committee, or is this something separate from that?

OBAMA: Well, I hope the super committee takes its job seriously. And, obviously, there's an added sense of urgency, given how anxious I think businesses and consumers are after the debacle surrounding the debt ceiling.

But my attitude is that I'm going to make my best case for where we need to go. We've made progress since the start of this recession back in 2008. It hasn't been fast enough. We've got to accelerate it, and there are two things that need to happen.

Number one, we've got to make sure that people have confidence we've got our fiscal house in order and that we're living within our means, eliminating programs that don't work.

Number two, there's some immediate things we can do around infrastructure, tax policy, that would make a difference in terms of people hiring right now.

BLITZER: When you took office, you said this -- and I'm sure you remember -- you said, "If I don't have this done in three years, then there's going to be a one-term proposition," meaning you're going to be a one-term president.

You remember that?

OBAMA: Well, here's what I remember, is that, when I came into office, I knew I was going to have a big mess to clean up. And, frankly, the mess has been bigger than I think a lot of people anticipated at the time.

We have made steady progress on these fronts, but we're not making progress fast enough. And what I continue to believe is that ultimately the buck stops with me. I'm going to be accountable. I think people understand that a lot of these problems were decades in the making. People understand that this financial crisis was the worst since the Great Depression. But, ultimately, they say, look, he's the president, we think he has good intentions, but we're impatient and we want to see things move faster.

And I understand that, I'm sympathetic to it, and we're going to just keep on putting forward ideas that are going to be good for the country. We're going to need a partner from Congress, and we're going to need folks to move off some of these rigid positions they have been taking in order to solve these problems.

BLITZER: I'm going to go through some specifics on that, but let's talk about some things that you need to do.

You, yourself, have said you support modest modifications in Medicare. Give me specifics.

OBAMA: Yes. Yes.

Well, what I'm going do -- I'm not going to make news here, Wolf, in terms of what a comprehensive plan would look like -- but what I have consistently said is that Medicare, health -- and health care costs generally are out of control, that the health reforms that we initiated are starting to reduce those costs, but we're going to have to do more, particularly around Medicare and Medicaid.

BLITZER: Changing the cost of living index?

OBAMA: What we -- what we...

BLITZER: ... which would reduce the amount of money for Medicare, Social Security recipients?

OBAMA: As much as possible, what we'd like to do is actually reduce the cost of health care, as opposed to just shifting the cost from the government to seniors. That -- that...

(CROSSTALK)

BLITZER: But a change in the cost of living, is that something you're open to?

OBAMA: The problem with some of the proposals we've seen, including some of the proposals coming out of the House of Representatives and the Republicans there, is they don't really address what they -- what it takes to reduce costs.

What they say is, senior citizens, we're going to voucherize it, and whatever inflation there is you're going to have to cover out of pocket. So seniors might have to spend $6,000 more.

What we say is, are there modifications that can change the delivery system and how health care is delivered so that you don't have to take five tests, you take one, so that providers are not ordering unnecessary procedures, but focusing on what actually works?

The more we can do those kinds of changes -- and, in some cases, you know, that involves empowering consumers to make better choices -- then we can hopefully control these costs without seeing any radical change to the basic structure of Medicare.

BLITZER: Why don't you support a balanced budget amendment to the Constitution?

OBAMA: Well, I support balancing our budget. The question is, do we need to change our Constitution to do it? We didn't for a lot of years.

And what we've always said was that the federal government needs, as a actor of last resort, if we've got a war, if we've got a recession, to be able to step in, in ways that states or local governments can't do.

BLITZER: Couldn't you write language into that so that, in case of an emergency, a war, there would be exempt -- exceptions?

OBAMA: I guess here's the question, is, why can't Congress simply make good choices? Why can't the president and Congress, working together, get a handle on our debt and deficits?

Why do we need to go through a constitutional amendment process and have a whole bunch of contortions and try to write in every single contingency that might come up, instead of simply saying the same thing that families all across Iowa and all across the country do, which is, you know what, here's how much money we're bring in, here's how much we're spending, and if it's out of balance, let's fix it?

BLITZER: It's clear Congress can't do that. That's why they need -- the argument is. Seventy-four percent, according to our own CNN/ORC poll, want a balanced budget amendment.

OBAMA: You know, here's my suspicion. I think 100 percent of the American people want Congress to act responsibly. A hundred percent of the people want us to make sensible choices.

We don't need to amend our Constitution in order to do that. What we need is folks acting responsibly and saying here's a balanced package that would actually get our debt and our deficit to a manageable place.

And here's the thing, Wolf, is, it doesn't require that much. I mean, you know, our fiscal situation is so much stronger than so many countries around the world, including a lot of European countries. And the reason is, is because all we have to do is make some modest changes in terms of what we spend, and make some modest changes in terms of raising revenue, and we could get things into balance.

The problem we have is a political system in which you've got one side or the other that says, here's the line in the sand. We're not going to make any changes.

When I saw our Republican presidential primary candidates suggesting that they wouldn't be willing to close a single loophole or close a single special interest tax break, even if they were going to get $10 of savings for every $1 of revenue that raised, that is no longer thinking in a commonsense way. At that point, what you're saying is ideology rigidity that is preventing us from solving problems.

BLITZER: Because you keep saying that there are some in Congress -- and you don't say who -- some in Congress who are more interested in political gain than really helping the country.

OBAMA: Yes.

BLITZER: Who do you mean by that?

OBAMA: Well, look, I think there is no doubt that the deal that I put forward to Speaker Boehner, which a lot of people in my party attacked me for, because they thought that we were going too far, we were being too generous in terms of trying to compromise, the fact that they couldn't accept a deal in which you had significantly more cuts than revenue, that would have done substantially more to close our deficit than the deal that ultimately we arrived at, the fact that Speaker Boehner and folks in his caucus couldn't say yes to that tells me that they're more interested in the politics of it than they are in solving the problem.

And I think -- to his credit, I think Speaker Boehner tried. I think he wanted to, but I think he had problems with members of his caucus that thought that somehow cooperation with this White House would help us politically, as opposed to thinking, what's going -- what's it going to take to help the country as a whole?

(END VIDEOTAPE)

BLITZER: All right, there's much more, much more ahead with my interview with the president of the United States, including his response to his newest challenger, Texas Governor Rick Perry, who appeared to suggest -- maybe even more than appeared to suggest -- that U.S. troops really don't respect the commander in chief.

(COMMERCIAL BREAK)

BLITZER: The race for the White House on the Republican side is certainly heating up here in Iowa, and so is the rhetoric. The newest contender, the Texas governor, Rick Perry, raised eyebrows with one rather controversial remark.

I asked President Obama about that as our interview continued.

(BEGIN VIDEOTAPE)

BLITZER: Rick Perry, the governor of Texas, Republican presidential candidate now, says, the men and women of the United States military want someone who's worn the uniform. He says he served in the Air Force.

Do you see a comment like that that he makes, referring to you, as disrespectful to the commander in chief?

OBAMA: You know, Mr. Perry just got into the presidential race. And I think that everybody who runs for president, it probably takes them a little bit of time before they start realizing that this isn't like running for governor or running for senator or running for Congress, and you've got to be a little more careful about what you say.

But I will cut him some slack. He's only been at it for a few days now.

BLITZER: Mitt Romney says corporations are people. Does he have a point?

OBAMA: Well, if you tell me that corporations are vital to American life, that the free enterprise system has been the greatest wealth creator that we've ever seen, that their corporate CEOs and folks who are working in our large companies that are creating incredible products and services and that is all to the benefit of the United States of America, that I absolutely agree with.

If, on the other hand, you tell me that every corporate tax break that's out there is somehow good for ordinary Americans, that we have a tax code that's fair, that asking oil and gas companies, for example, not to get special exemptions that other folks don't get, and that if we're closing those tax loopholes, somehow, that that is going to hurt America, then that I disagree with.

And I think that, you know, corporations serve an important benefit, but ultimately we've got to look at what's good for ordinary people, you know, how do we create jobs, how do we create economic growth. And a lot of the special interest legislation we see in Washington isn't benefiting ordinary people.

BLITZER: What do you think of that Republican field lining up to challenge you?

OBAMA: You know, I haven't been giving it too much thought. I figure that I will let them winnow it down a little bit. When they -- when they decide who they want their standard bearer to be, then I will be ready for them.

BLITZER: I was in North Korea last December, and every time I raised the issue of hunger in North Korea, which is a huge problem, starvation, the North Korean handlers would say to me, well, what about hunger in America? One out of seven Americans, including a lot of children, are hungry, they would say.

And, in fact, last week, 46 million Americans now rely on food stamps, really, to survive. What does that say about the wealthiest country in the world, that 46 million Americans rely on food stamps in order to put food on the table?

OBAMA: Well, what is says is, first of all, we've had a terrible recession, and that means that's strained a lot of families' budgets, and so you've got a lot of folks who consider themselves middle-class working families who are going through a tough spot. That's why we have food stamp programs in place.

That's why it's important that we're not trying to reduce our budget deficit on the backs of those who are most in need. On the other hand, keep in mind that America is the world's breadbasket. Agricultural exports are incredibly important to the U.S. economy. We see the incredible bounty in places like Iowa here. And the problem we have is not that we don't have enough food, which is the problem in a place like North Korea. The problem is, is that the distribution of income and wealth in this country has been a problem for some time.

Wages and incomes for ordinary families have not gone up for the last decades, even before this last recession hit. And that's why it's so important, in addition to creating economic growth, in addition to seeing corporate profits go up, in addition to seeing the stock market go up, we've got to make sure that we're investing in people, investing in innovation, investing in infrastructure, doing those things that are going to put people back to work and give them more income, so that they can live the kind of American dream that all of us want for our kids and our grandkids.

BLITZER: I have covered the Middle East for a long time. I have covered terrorism for a long time. And I have to tell you, I'm worried, that on the 10th anniversary, approaching the 10th anniversary of 9/11, al Qaeda, or what's left of al Qaeda or their supporters, will try to do something to seek revenge for your killing bin Laden.

How worried should we be about that? How worried are you about that?

OBAMA: Well, look, we are vigilant and constantly monitoring potential risks of terrorist attacks. And I think that the men and women in our intelligence agencies, as well as the FBI, have done a terrific job, and Department of Homeland Security.

But the risk is always there. And, obviously, on a seminal event like the 10th anniversary of 9/11, that makes us more concerned. It means we've got heightened awareness.

The biggest concern we have right now is not the launching of a major terrorist operation, although that risk is always there. The risk that we're especially concerned over right now is the lone wolf terrorist, somebody with a single weapon being able to carry out wide- scale massacres of the sort that we saw in Norway recently.

You know, when you've got one person who is deranged or driven by a hateful ideology, they can do a lot of damage, and it's a lot harder to trace those lone wolf operators. So we're spending a lot of time monitoring and gathering information. I think that we generally have to stay vigilant. There may be a little extra vigilance during 9/11.

On the other hand, keep in mind the extraordinary progress we've made over the last couple years in degrading al Qaeda's capabilities. They are a much weaker organization with much less capability than they had just two or three years ago.

BLITZER: So what I hear you saying is we don't have to worry about a spectacular, 9/11 kind of event, more like a lone wolf can do some damage, kill a lot of people, but not a nuclear, radiological or anything like that?

OBAMA: Well, look, as president of the United States, I worry about all of it.

But I think the most likely scenario that we have to guard against right now ends up being more of a lone wolf operation than a large, well-coordinated terrorist attack. We still have to stay on top of it, though, and we're never letting our guard down. That's part of our job.

BLITZER: We're out of time, but a quick question.

If you're reelected -- the last time you were elected, you got Sasha and Malia a cute little puppy.

OBAMA: Yes.

BLITZER: Bo. OBAMA: Yes.

BLITZER: What are you going to get them the next time, if you're reelected?

OBAMA: When I'm reelected, what I will be getting them is a continuation of Secret Service so that when boys want to start dating them, they are going to be surrounded by men with guns. That's their gift.

BLITZER: I'm sure they're going to be thrilled about that.

(LAUGHTER)

BLITZER: Mr. President, thanks very much, sir. Good to see you in Iowa.

OBAMA: Appreciate you.

BLITZER: See you back in Washington.

OBAMA: Thank you so much.

BLITZER: I hope you'll be coming and joining me in my SITUATION ROOM.

OBAMA: I look forward to it.

BLITZER: And if you invite me to yours, I will be happy to come to yours as well. You can do that. You're the -- you're the president of the United States.

OBAMA: Thank you, Wolf. You can visit any time.

BLITZER: We're going to -- we're going to take you up on that.

OBAMA: Just you can't bring cameras. That's the only difference.

BLITZER: I will come by myself. Thank you.

OBAMA: OK. All right.

(END VIDEOTAPE)

BLITZER: All right, that was the formal sit-down part of the interview, but there was a lot more. We had a chance to walk and talk and talk about some other issues with the president of the United States here in Iowa. That is going to be part three, we're calling it, of the interview.

And, among other things, I'm going to ask him what the best job in the world is, according to Barack Obama.

Also, the president tells us and explains what else is the best and worst parts of being the leader of the United States. The third and final part of the interview with the president, that is coming up. Stay with us. You are in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Before I sat down with my one-on-one interview with the president, we had a chance to speak informally. And the president spoke candidly about the best part of his job and the worst.

(BEGIN VIDEOTAPE)

BLITZER: How do you feel, first of all?

OBAMA: Well, we've had two incredible days.

First of all, the weather has been perfect. It's nice getting out of Washington. But what's been most important has been the chance to just talk to ordinary folks, reminding you how wonderful, decent, hardworking, responsible people are out here.

They are clearly frustrated with what's going on in Washington. They understand that the economy is tough, and what they're hoping for is everybody pulling together to get things done.

And it's a -- it's a real affirmation of the American spirit, and it fills me up with a lot of good feeling that I hopefully can take back to Washington.

BLITZER: You know, you've have aged...

OBAMA: I have.

BLITZER: ... over these past three years or so. You know, you've got a little more gray hair.

OBAMA: Some people, some old friends who I have been seeing around here, have reminded me that when I was a young senator traveling through Iowa that I looked a little younger than I do now.

BLITZER: We're going to show our viewers a picture of what you looked like in Des Moines at the end of October 2008 and what you look like now. And you know what? I might go back to 2004 to the Democratic Convention in Boston.

(LAUGHTER)

BLITZER: You still like being president of the United States?

OBAMA: It's the greatest job on Earth. Obviously, we are going through a lot of challenges right now. And when you're president of the United States, you feel accountable and responsible for every single thing that happens.

If there is a flood somewhere, if there is a tornado, if somebody is losing their job, at some level, you feel responsible and you want to make sure that you are doing right by the American people. But the incredible privilege of being able to work with so many talented folks, to meet so many wonderful people all across the country, nothing compares to...

(CROSSTALK)

BLITZER: What's the best part?

OBAMA: The best part is the kinds of things that I have been doing today.

You go into a diner and you sit down and talk to people and you hear their life stories. And every once in a while, they'll say, you know what, my kid has hemophilia and was about to lose his insurance until you passed your health care bill and it's really helping us, or a small business owner says, you know, I got started because the SBA got in there and took a chance on them -- on me.

When you hear that some of the policies you put in place had actually made concrete differences in people's lives, nothing is more gratifying than that.

BLITZER: And the worst part?

OBAMA: The worst part is when you -- when you are talking to a family member of a fallen soldier and you are hugging them.

On the one hand, you hope that you're making them feel a little bit better. At the same time, you are reminded of the incredible sacrifices that people are making for our country. And then, when you see sometimes our politics not living up to that level of commitment and patriotism that we see from our troops, that gets a little bit of frustration.

BLITZER: And you -- do you get emotional in those meetings?

OBAMA: Oh, absolutely.

It -- you know, for a mother or father who've lost a loved one, that's always the toughest thing about the job.

BLITZER: And you have to say to yourself, you know what, I sent those young men and women off to war.

OBAMA: At some -- at some level, I'm responsible.

And it's a sobering reminder that every single decision we make in the White House counts and is making a difference in people's lives. And there are times where they will keep you up at night. No wonder I have got more gray hair now.

BLITZER: Yes.

A quick question. You know, Washington, I have been there a long time...

OBAMA: Right.

BLITZER: ... a lot longer than you've been there.

OBAMA: Right.

BLITZER: When we spoke here end of 2008, hope and change.

OBAMA: Yes. Right.

BLITZER: You know what I see in Washington still to this day?

OBAMA: More of the same.

BLITZER: The same old, same old. A lot of bickering, back stabbing.

OBAMA: Maybe a little worse.

BLITZER: Name call -- why?

OBAMA: I think what has happened, you know, there are a lot of theories about this. Part of it is you have these congressional districts that are now so Democratic or so Republican that people don't feel like they need to move to the center and try to find some common ground. They dig in their heels. They are more worried about a primary fight coming from their own party. That contributes to it.

Some of it, frankly, Wolf, is I think the media has changed. It's much more splintered. You don't have the entire population watching Walter Cronkite and hearing one source of news. Now everybody is kind of going off into their respective corners.

And look, when the economy is tough and people are anxious, I think contributes maybe to a little more polarization. But what I know is that when I leave Washington, and I talk to folks out here. You know, I have had a number of conversations with people who come up and say you know what, I'm a Republican. I don't agree with everything you are doing, but I know you are trying to do your best for the country and I'm rooting for you. I'm praying for you. That kind of attitude that says, we are more concerned about the country winning that we are about winning the next election. If that kind of spirit is infused in Washington, I think we are going to be just fine

(END VIDEOTAPE)

BLITZER: All right. Let's talk about what we just heard from the president. Joining us, our CNN Senior Political Analyst David Gergen, and our CNN Chief White House Correspondent Jessica Yellin.

David, you just heard the president's explanation of why U.S. politics can be so ugly. He spoke about the media, redistricting. But is he doing enough right now to rise above it all? To do something? To bring back what he spoke about, hope and change, instead of what I suggested was the same old, same old? And he said it might even be worse now. DAVID GERGEN, CNN SR. POLITICAL ANALYST: What I thought in what he did say he is dead on. The analysis has struck me as just right. I think most people would agree with his point.

Whether you think he, himself, has done enough, a lot depends on where you sit. If you are a Republican you think he is contributing to the cause. He is blaming the Republicans for the downgrade of the debt. He's blaming Republicans for putting politics above the country, and all the rest.

But if you are a Democrat, a lot of Democrats feel he hasn't fought back hard enough. That he has been too compromising. He's been too willing to seek the middle. He's been too conciliatory and they would like him to come out punching more. So, so much depends, I mean, we are so polarized we have different interpretations of that.

I must tell you that for my own perspective, I think it's very early for him to be out campaigning. And I continue to believe that he would be better received by the country if he were spending time in Washington right now, calling the congressional leadership back to see if he can cut a deal on jobs.

BLITZER: He made it clear he is not going to do that, at least not now. They will continue their recess until September 7.

Jessica, the president acknowledged what is being said about him by Governor Perry, by Mitt Romney. But, you know what? He didn't exactly go very hard in hitting them right back. They have been very tough on him, and he sort of responded, but he didn't slam them by any means. Is there a strategy here?

JESSICA YELLIN, CNN CHIEF WHITE HOUSE CORRESPONDENT: Well, sure he wants to stay above the fray of presidential primary politics. You know at this point in a campaign it would essentially be handing either candidate a gift for the commander in chief to take a swing at someone who hasn't even become a nominee.

So, the president is not going to step into that fight right now. But what you hear him doing is attacking Republicans broadly, for their policies. He says-he calls it Congress, but when he say, you know, Congress is standing in the way of getting my jobs initiatives passed, you can read that as the Republicans in the House of Representatives, and also the Republican candidates on the trial who endorse their positions.

You heard the president say it in his town halls. You heard him say it to you, Wolf. And you will hear him say it throughout September, as he comes back from the vacation and continues to push his jobs proposal, which he will unveil. And he is going to hit the campaign-well, he hit the road, he won't call it the campaign trail- sending this message that Republicans, in essence, are blocking an agenda he would like to get done for the country

BLITZER: All right. Jessica, David, I want both of you to stand by. We have much more to talk about. I want to get your take on the other things the president said about jobs and how much responsibility is he taking for the unemployment crisis in the United States. More on the president's tour through the American heartland as well. Stay with us. You are in THE SITUATION ROOM.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

OBAMA: What I continue to believe is that ultimately the buck stops with me. I am going to be accountable. I think people understand that a lot of these problems were decades in the making. People understand that financial crisis was the worst since the Great Depression. But ultimately they say, look, he is the president. We think he has good intentions, but we are impatient and we want to see things move faster. I understand that. I'm sympathetic to it. And we are going to just keep on putting forward ideas that will be good for the country.

(END VIDEO CLIP)

BLITZER: More on my one-on-one interview with the president here in Iowa. We are talking about it with our Senior Political Analyst David Gergen and our Chief White House Correspondent Jessica Yellin.

David, the president is in a tough spot, I should say. It sounds like he admits he is responsible, but doesn't want to receive the blame for the slow recovery. What's your take?

GERGEN: He has been very, very deft, I would have to say. And sort of whenever these kind of subjects come up, he does-sure shoves the blame in a different direction. He said basically that we had a lot of headwinds that came out of Japan and so forth. But he also made it clear he thought that the Republicans, and again to go back to Jessica's point, he sort of camouflages it. Sometimes he talks about Congress, but you know what he is really saying is the Republicans have caused this downgrade. So, he-you know, a lot of people find that disingenuous. That it is not really a serious conversation, but look, it is what got us-he's come a long way on those kind of arguments in the past. So, I guess the White House feels they will keep pushing it.

BLITZER: Jessica, we also heard the president say he has a new jobs proposal he will release in September. He wouldn't me what's in it. I asked him. You heard me ask him what's taking so long. We have had a jobs crisis in the United States for two and a half, plus, years. Longer than that, I should say. But what are we hear being this new proposal. Do we have an idea where it will take the U.S.?

YELLIN: Well, they are working on it. There are a lot of potential elements of it that could involve different kinds of tax credit possibilities, and different kind of policies that have been floating out there for a while, Wolf.

But what we know he'll do is put out a jobs-a big jobs package that has a lot of these different policies together, into one comprehensive plan that he will release after Labor Day vacation. He will also, in addition that, put out a proposal what he believes and that the White House believes this super committee should do. That sort of combination of revenues and taxes, combine. And then we will see him go on the road, pushing and promoting this and making the case to the American public. Have him out there rolled up, in his shirt sleeves, selling his case,. So that he has a lot of distance from Congress. Because they think the closer he is to Congress, the lower his poll numbers go.

I would make one point. Going back to what David just said, which is that the president has been deft, in sort of saying the buck stops here, but other people are actually also to blame. A recent CNN poll said that most Americans, 57 percent, still say that Bush and the Republicans are mostly to blame for the economy. So it is actually connecting with the American public to say that, you know, when the president said he is ultimately responsible for fixing it, but he didn't cause the problem. It is a message that seems to be working for him. So they are continuing to try to use it to dig him out of some of this low favorable ratings when it comes to the economy right now.

BLITZER: All right, Jessica, thank you. David, thanks to you, as well.

When the president of the United States, by the way, goes on a bus tour you can be sure it's no ordinary bus. We are going to take a closer look at what our White House Correspondent Brianna Keilar has dubbed "The Beasty Bus". Plus, CNN's Jeanne Moos, at a hero's welcome from man's best friend.

(COMMERCIAL BREAK)

BLITZER: Iowa has six electoral votes at stake in 2012. It has certainly become more of a swing state in recent presidential elections. President Obama easily won Iowa back in 2008. The state went Republican four years earlier with George W. Bush eking out a slim victory. In 2000, Democrat Al Gore narrowly beat Bush in Iowa.

Let's reflect a little bit about what is going on. Brianna Keilar is with us.

Brianna, this is not technically a campaign trip, although it does have that feeling. I've covered a lot of campaigns. It certainly does to me. But he is trying to make some policy decisions and meet with local constituents at the same time.

BRIANNA KEILAR, CNN WHITE HOUSE CORRESPONDENT: It is. It is a bit of a two-fer, it strikes me as. You have, on one side, the fact that one side, here we are in Iowa. You can't escape that fact, especially with all the action you are seeing from Republican presidential candidates here in the last week.

And, of course, the president is hoping for some support here that he got in 2008, that really gave him that early momentum. But on the other hand, you also have him here using Iowa as a backdrop for rural issues. And we have talked about this. That Democrats, in the mid-term election, in 2010, really struggled with rural America. And arguably it cost them, or helped cost them control of House of the Representatives, which the president would now say is causing certainly a lot of the headaches that he is having.

So, here you saw the president today. And even though we are waiting for him to unveil a big, sort of jobs creation series of initiatives, he was unveiling smaller things here today for rural communities. Increased lending, for instance, and increased technology in areas like this, for businesses here.

BLITZER: He certainly though, was ready to engage with me on political issues, when I brought up some of controversial comments that Rick Perry made, that Mitt Romney made. He didn't back away at all, although he didn't slam them or anything like that.

KEILAR: No he didn't back away and having talked to some advisers to the president, they are really in a wait-and-see kind of mode here right now. Right now there is so much interest in Rick Perry, but you know, months of go there was so much interest in John Huntsman that we are not seeing as much now. So, I think they are keeping an eye right now on Rick Perry, to see kind of what comes from this.

Because even though there is so much interest and so much kind of fire, in a way, intensity there? There is also a thought that this could come to fizzle. Who knows? We have seen that with other candidates. Now is not the time, they feel, to really be truly engaging. That will come as things sort of flush themselves out.

BLITZER: I was, I guess, surprised to see how emotional he got when I asked him what the worst part of this presidency is. And he said meeting with families of those who have died fighting for the United States. I was also surprised, he was pretty blunt in expressing his concerns about the 10th anniversary of 9/11.

KEILAR: Yes.

BLITZER: You know, when he spoke about a lone wolf, if you will, trying to take revenge for the killing of bin Laden.

KEILAR: That struck me, as well, too. That was really one of the parts of the interview that kind of opened my eyes. When you said, what about the idea there that there may be some sort of revenge in a way from Al Qaeda, from the terrorists-

BLITZER: Because you know they wanted to get revenge for the killing of bin Laden?

KEILAR: Certainly. And always these anniversaries are something of such import, and there is always this concern. Were you surprised he said that?

BLITZER: Yes.

KEILAR: The lone wolf comment?

BLITZER: I was surprised that he went into that kind of detail. And then when we spoke about a spectacular event. He said, I have to worry about it. I'm the president of the United States. And they will take-they will beef up their security in advance of the anniversary of 9/11. That is coming up very soon.

Brianna, don't go away because we have something else we want to share with our viewers-the bus.

(LAUGHTER)

BLITZER: It's no ordinary bus that the president of the United States is riding through the Midwest. Like the limo nicknamed "The Beast", the president's bus is a one-of-a-kind. Brianna is here to give us an inside look. We'll look at the bells and whistles.

Sit, stay, and fetch, those are the usual tricks dogs are asked to learn, but the best one of all is welcoming back a family member from a war zone.

(COMMERCIAL BREAK)

BLITZER: All right. By now you've probably seen it, the president's new black bus. It looks like something out of a science fiction movie. More appropriate perhaps for Darth Vader than the commander in chief. But as you might expect this is no ordinary bus. Let's bring back our White House Correspondent Brianna Keilar, who is joining us.

There is actually more than one of these amazing buses. There's two.

KEILAR: That's right, there's two of these buses, that the Secret Service has purchased. It's the first time that they have added buses to their fleet of vehicles, which does include, of course, the presidential limousine known as 'The Beast" when the president is in it. So, why did they buy these buses, they actually say it was to save money.

(BEGIN VIDEOTAPE)

KEILAR (voice over): President Obama is rolling through the Midwest this week on a three-state campaign-style swing in a brand- new, sleek black armored bus.

OBAMA: As I was driving down in those little towns, in my big bus and I'm-

(LAUGHTER)

We slowed down and I'm standing in the front and I'm waving.

KEILAR: It's one of two the Secret Service bought in the last few months for moving what they call protectees, the president and first lady, the vice president, and eventually the Republican presidential nominee, among others.

This bad boy costs $1.1 million. That's $2.2 million for both coaches according to a public invoice showing the buses were purchased from a company in Tennessee. The Hemphill Brothers Coach Company's Web site displays a number of used buses for sale, including one that used to belong to a popular country music act.

But this bus is brand spanking new. Outfitted with advanced communication systems so the president can talk securely with advisers or world leaders while on the road. And, of course, protective armor, though, it doesn't shield president Obama from this: Americans upset with his policies lining up to send him a message as his motorcade passes by in Iowa.

The Secret Service bought the buses in anticipation of the busy 2012 presidential campaign. A spokesman saying we felt we were overdue for having an asset like this in our fleet. Candidates and presidents have been participating in bus tours since 1980.

(END VIDEOTAPE)

KEILAR: Now, before buying these buses, the Secret Service would lease buses, because they were using them. And then they would outfit them with these advanced communication systems and armor. And then when they had to return the buses, they would have to take all of that stuff off. And that's why they said it was a tremendous expense, tens of thousands of dollars per month to lease these buses. That's why they said they went this direction.

BLITZER: So that $1.1 million is a bargain is that what you're saying?

(LAUGHTER)

KEILAR: Apparently. They won't say that.

BLITZER: Yes. All right, Brianna, good work. Thanks very much. Enjoy the rest of this bus trip.

A dog can be a service member's best friend and faithful pets are turning up to welcome back troops from the battlefield, sometimes with extremely enthusiastic welcomes.

(COMMERCIAL BREAK)

BLITZER: Sometimes a family dog is more than just a pet. Here's CNN's Jeanne Moos.

(BEGIN VIDEOTAPE)

JEANNE MOOS, CNN NATIONAL CORRESPONDENT (voice over): You know, all those heart warming, two-legged reunions, the military ones that end in --

UNIDENTIFIED MALE: Love you.

MOOS: Well, this is the four-legged version.

UNIDENTIFIED MALE: Hey. You do not recognize me?

MOOS: Emmitt Thunder Paws is the Great Dane's name and for Senior Airman Trevor Crowder arriving back from Afghanistan. TREVOR CROWDER, SENIOR AIRMAN: It was the second best reunion I've had since getting back.

MOOS: The best being the one with his wife, Whitney.

WHITNEY CROWDER, AIRMAN'S WIFE: I think he remembers you. He didn't get out of Trevor's face for probably a solid week.

MOOS: From humongous dogs like Emmitt Thunder Paws to the tiny ones like these two Dachshunds, canine reunions are running rampant on YouTube. From baying beagles to whimpering Molly, crying over the return of her Air Force captain owner.

(On camera): The one thing most doggie reunions have in common they can turn a macho soldier into a baby-talking softy.

UNIDENTIFIED MALE: You my boy?

MOOS (voice over): Fathers talk to their dogs like adults.

UNIDENTIFIED MALE: I missed so badly, I'm so sorry I went away.

UNIDENTIFIED MALE: Look at you, Smalley Boy (ph).

UNIDENTIFIED FEMALE: Ah, you are going to make me cry!

MOOS: Soldiers locked in a canine embrace.

UNIDENTIFIED FEMALE: Oh.

UNIDENTIFIED MALE: He wanted to have direct eye contact and make sure that I was here.

MOOS: The doggie reunion can even eclipse the human one.

UNIDENTIFIED FEMALE: Oh!

MOOS: When the lady of the house handed her man the camera to show off her welcome home ensemble --

UNIDENTIFIED MALE: Your lovely outfit?

UNIDENTIFIED FEMALE: Yes.

UNIDENTIFIED MALE: Oh!

MOOS: Kodiak kept stealing the show.

UNIDENTIFIED FEMALE: Yeah!

UNIDENTIFIED MALE: That's wonderful. You are looking good.

UNIDENTIFIED FEMALE: I'm sorry. But I need to be the center of attention so -- MOOS (on camera): Of course, dogs have a pretty short attention spans. So, after only about 45 seconds of intense petting, and a little chasing around --

UNIDENTIFIED MALE: And we're done.

MOOS: For those of you who think the joy pets bring is just hot air -

(On camera): It's the next best thing to a reunion. Yes, couldn't you just once be happy to see me?

UNIDENTIFIED MALE: Happy?

MOOS: Happy, even when outnumbered. At least a soldier can say things to his dog that he probably shouldn't say to his wife.

UNIDENTIFIED MALE: That's your butt.

MOOS: Jeanne Moos, CNN, New York.

(END VIDEOTAPE)

BLITZER: I'm Wolf Blitzer in THE SITUATION ROOM.