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How President Obama Won; Interview With Maine Senator-Elect Angus King; Voters in Two States Approve Gay Marriage; Boehner Remarks

Aired November 07, 2012 - 15:00   ET

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

BROOKE BALDWIN, CNN ANCHOR: What a night for first family. President Obama heads back to Washington this hour. Victory in hand, but the fiscal cliff very much so looming large.

Hello, I'm Brooke Baldwin at the CNN World Headquarters in Atlanta.

JOHN KING, CNN ANCHOR: I'm John King in the CNN Election Center in Washington. The president could be returning to a capital city that is more willing to compromise, at least when it comes to avoiding the fiscal cliff. Listen to the Senate Majority Harry Reid. He talked with the House Speaker John Boehner just this morning.

(BEGIN VIDEO CLIP)

SEN. HARRY REID, D-NV, MAJORITY LEADER: This isn't something that I'm going to draw lines in the sand, he's not going to draw lines in the sand, I don't believe, and I think we need to work together.

QUESTION: Do you think a deal is possible?

REID: Of course.

(END VIDEO CLIP)

J. KING: Conciliatory tone there. We will see what the speaker has to say. He's speaking live half-an-hour from now.

BALDWIN: We will take that live.

Meantime, Wall Street stumbles here this day after election. Take a look, the Dow down 262 points, closing bell in just 60 minutes, investors turning their attention from the election to money troubles both here and abroad, worries about we're going to be talking about it for a bit here, the fiscal cliff and also Europe's recession and a warning about Germany all taking their toll. We're keeping an eye on the Dow.

J. KING: Back to politics now.

An adviser to Mitt Romney tells CNN the Romney campaign really thought they were going to win. Of course, in the end, they didn't.

Our chief political analyst, Gloria Borger, is here to talk about how President Obama won. Gloria, when you look at the map, when you look at the map, Florida is not called yet, the president is leading at the moment, a narrow victory in the popular vote, a very narrow, so not as big a win as last time, but when you look at the electoral map, almost as big a win.

Governor Romney flipped only two states, North Carolina and Indiana. We will wait and see what happens in Florida. Was that a surprise given it was a -- you didn't have any pro-Democratic, a big wind at his back like last time.

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: No, there was not a sweep here. Neither of these candidates had coattails either. This wasn't what we would call a wave election.

And so some of the battleground states were a surprise to us because they were so tight, and they all seemed to move in one direction towards the president. And I think the reason that occurred is because the president knew the people who were going to vote for him in his new coalition, and he expanded it, rather than narrowing it, even though the Republicans said, look, we have got voter intensity on our side, we have enthusiasm on their side, but what they didn't have was the demographics of the changing American population.

J. KING: Let's take a close look at that looking back at our exit polls here.

Let's start first by age. A lot of people thought the youth vote would drop. It actually went up a little bit. Look at this, overwhelmingly for the president. He got the younger voters and he got them turn out.

One of the advantages, ladies and gentlemen, of not having a primary challenge, they spent months and millions finding these voters and signing them up. The president kept that number constant. And this number stayed pretty static. Mitt Romney won the senior vote, but probably not by as much as he needed to.

BORGER: Yes. He needed probably to make that number a little bit higher, and maybe Paul Ryan could have been a bit of a drag on him with that particular number.

But, again, the president didn't expect to win with these voters. He was mining younger voters and, of course, ethnic voters, minorities and also women, which we will talk about too.

J. KING: But let's move it over, let's bring that over, let's do it by gender. If we bring that up here, if you bring it up here -- let's try that again. She gets funny sometimes. Here we go, 47 percent -- she had a long day yesterday.

BORGER: Is she a she?

J. KING: He, she, it had a very long day yesterday.

(CROSSTALK) J. KING: Governor Romney wins the men vote; 47 percent of the electorate was male. Governor Romney won. But a majority of the voters were women yesterday, Gloria, and the president won with an 11- point edge there. If you're getting an 11-point edge in a majority of the electorate...

BORGER: That's a problem.

Again, you know, Mitt Romney has an advantage with men, but he didn't have as much of an advantage with men as the president had with women. And as you heard at all the conventions, suddenly everyone's role model was their mother and they wanted to appeal to women.

But I think the Republican primaries also had a lot to do with this. When issues like contraception, Roe v. Wade start coming up in primary fights, I think it was very difficult for Mitt Romney to take a turn, and his wife tried to help him do that, but to take a turn towards American women and say, you know what, we're really on your side, we want you to vote on the economy, which, of course, is a good case to make to women, but there were other issues they also cared about.

And the Republican Party as a whole, not just Mitt Romney, I don't think you can't sort of blame this on Mitt Romney, the candidate himself, it is the Republican Party that has a problem with women voters.

J. KING: Legacy problems, you might say. Women voters, Latino voters, you get out here in the West, it's a tough time ahead.

We will watch this one play out.

BORGER: It is not enough to just do well with white men anymore.

J. KING: That party can't win in this changing country.

(CROSSTALK)

BORGER: It will shrink.

J. KING: Gloria, thank you -- Brooke.

BALDWIN: Yes. We now know Democrats keeping the White House. We know Democrats keeping control of the U.S. Senate. Republicans keeping control of the House.

But we're adding an independent to the Senate. He's senator-elect Angus King of Maine. He's being a tad coy today, not revealing which way his political affections may bend.

Everyone in the Senate now wants to know, will King caucus with the Democrats or the Republicans? He routed his opponents, a Democrat and a Republican, last night, and will replace retiring Republican Senator, veteran Senator Olympia Snowe.

Here is part of his victory speech.

(BEGIN VIDEO CLIP)

SENATOR-ELECT ANGUS KING, I-ME: People don't care who gets the credit. They don't care who is winning and losing from year to year. And they're tired of the false choice that always seems to confront them.

As a guy said to me early on in this campaign, I have always wanted the chance to vote for none of the above. And you're it.

(CHEERING AND APPLAUSE)

(END VIDEO CLIP)

BALDWIN: Senator-elect King joins me on the phone from Brunswick, Maine.

Congratulations, sir, senator-elect. You like how that sounds?

A. KING: Thank you. Yes. It sounds pretty good. But I will go by Angus for now.

BALDWIN: OK. Angus King, let me ask you this, because everyone wants to know which way you caucus, and I have a feeling you are not going to tell me yet.

I understand you have requested meetings with both Mitch McConnell and Harry Reid here. Tell me, in those meetings, what will you be listening for, what are you waiting for to be that turning point to decide which party you will be caucusing with?

A. KING: Well, there are really two criteria that I have honed it down to. And one is the extent I can maintain my independence, and the second is how effective I can be on behalf of Maine.

And that's what I will be talking about. I ran on the platform of trying to call them as I see them, not be able -- not be locked into a party position one way or the other. And that's what I want to try to maintain.

But on the other hand, it isn't a stunt. I'm not going down there just to plant the flag and...

BALDWIN: Not a stunt.

A. KING: ... and not get anything done.

BALDWIN: Not a stunt.

John King, jump in.

J. KING: Governor King, it's John King. We have known each other quite some time. You're senator-elect. I am going to call you governor until you're senator, before the former governor as well.

A. KING: OK. J. KING: Will you talk to Olympia Snowe about this? I know she's a friend of yours. She was a Republican, sometimes a pariah in her own caucus. She worked with president on some issues, whether it was President Clinton. She was a key swing vote sometimes for President Bush and of course for President Obama on issues like the stimulus and health care.

Will you consult her and ask her, where do you think I will be more effective?

A. KING: Absolutely.

And I already have. She was the first person to call me last night and offer congratulations. We had a very warm conversation. And I hope to meet with her either up here in Maine later this week or if she's in Washington next week. But, yes, I ran for the mirror image of the reason she left. She said she couldn't take it anymore.

And I ran because I think we just got to -- that we maybe have to try it a different way. So, I'm an independent. I was an independent governor. But, absolutely, she's one of the first people I want to talk to.

BALDWIN: Governor King, let me just jump back in. You bring up Senator Snowe. She was on this show. I was talking to her back in September and she was explaining why it was she was officially done after decades being in Washington, why she was done with Congress.

Take a listen.

(BEGIN VIDEO CLIP)

SEN. OLYMPIA SNOWE (R), MAINE: None of the issues that we are now confronted with in the fiscal cliff, for example, were issues that were a surprise.

They were all anticipated. Even the debt ceiling crisis didn't have to be a crisis, putting the country through emotional travail, and so that's what is such, I think, a travesty.

(END VIDEO CLIP)

BALDWIN: Governor King, what will you do differently?

A. KING: Well, I hope I can be a bit of a bridge between the two parties.

When I was governor, I was an independent and worked with both sides and was able to achieve quite a bit. There were times when I agreed more with the Democrats and times when I agreed more with the Republicans. But, you know, I think Senator Snowe basically said, as a member of a major party, I can't make it work.

And so one of my life's philosophy is that doing the same thing harder isn't likely to achieve a different result. So I'm trying -- I'm coming in, in a different way. And I got to tell you, it is the number one thing I heard from people in Maine, and I can't believe it is only people in Maine who are reading it this way.

I think Congress has an approval rating of something like 9 percent. And we have just -- we have got to start talking to each other because we have got serious problems and this business of bickering and fighting and blaming, the public doesn't give a damn about that. They just want the problem solved.

J. KING: So, Governor, you say you will call it like you see it. Call it like you see it as you prepare to become a senator.

Some of this might be dealt with in the lame-duck before you get here. But when it comes to the fiscal issues, the fiscal cliff facing this country, can you get to the place the United States needs to be without on the one hand some deep cuts, including programs like Medicare, and some new revenues?

A. KING: The answer to that is, no, you cannot. It has got to be both, and I believe virtually everybody in Washington with the possible exception of Grover Norquist knows that.

And that's -- you have got to do it that way. I'm proud to say I was endorsed by Erskine Bowles and Alan Simpson in my campaign, because some kind of framework like they proposed I think is exactly the direction we have to move in.

And the sooner we can do it and put it behind us, the better everybody will be, the debt, as well as the economy.

J. KING: Senator-elect Angus King, it is now. Governor, it's good to talk to you today. And we will see you when you get in Washington. We wish you luck. It is a funny place, as you know.

(LAUGHTER)

A. KING: Yes. I'm looking forward to it, I think.

BALDWIN: Good luck, sir. Good luck. Thank you for jumping on the phone.

I appreciate his candor, his candor there, in talking about meeting in the middle.

Let's talk about the president, though, because in his victory speech last night, or I should say really the wee hours of the morning, President Obama pledged to act on climate change in his second term. This topic bound to get his opponents riled up. So, to talk about this and the election's impact, we're bringing in Fareed Zakaria. He will join us live next.

Plus, as we look in the Northeast, get ready for this, snow. Look at the radar. The nor'easter that is threatening the Northeast still, still very much so hurting from Sandy. We will take you there on the ground live.

(COMMERCIAL BREAK)

J. KING: President Obama still celebrating his victory in Chicago, but due to depart later this hour and head back here to Washington. He will arrive late this afternoon, returning to the White House firm with the knowledge he gets four more years.

Joining me now to discuss this from New York, our Fareed Zakaria.

Let's listen quickly to a snippet of the president's victory speech and focus here on what he mentions last.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: We want our children to live in an America that isn't burdened by debt, that isn't weakened by inequality, that isn't threatened by the destructive power of a warming planet.

(CHEERING AND APPLAUSE)

(END VIDEO CLIP)

J. KING: Sandy had to have some influence on that last part, the warming planet.

But, Fareed, you know this, barely a mention in the first term, nary a mention in the campaign. Will it be a significant policy issue now?

FAREED ZAKARIA, CNN WORLD AFFAIRS ANALYST: It is a very interesting question, John.

I think the truth is Barack Obama did do a fair amount with regard to climate change in the first term. That's what the whole green energy push has been. That's what the higher fuel-efficiency standards are. These are all efforts to lower in some way America's carbon footprint.

And, by the way, the natural gas piece of this has been a huge boon. We have declined more than the European Union in terms of carbon emissions over the last four years, largely because of natural gas. But still what you mean is will we get a carbon tax or cap and trade system? No, of course, not, as long as we have a Republican House.

But there is a second piece of this, which you could do. The first part is about mitigating, preventing climate change. There is a second piece which is adapting to it, building levees, dealing with coastlines, rebuilding infrastructure, making ourselves more resilient. That piece of it could be a very powerful thing to do, because, by the way, that's another word for rebuilding infrastructure, which would be an economic boon, it would bring down unemployment in the construction industry, and it would be a very effective response to one element of climate change.

J. KING: The president in a second term starts thinking about the L- word, legacy, and whenever people think of President Bush, the war in Iraq and Afghanistan, they can look to Africa and PEPFAR and say, wow, that's an impressive piece of the Bush legacy. When this president looks at the world, you remember we talked about this in the past, he told the outgoing Russian President Dmitry Medvedev, just give me until after the election, I will have flexibility. But when you look at the world, what do you think? In a second Obama term, what do you think?

ZAKARIA: The first thing I would say, John, as you know, I think when he looks at his legacy, he's going to look for the consolidating of health care. Make that work. Make Obamacare work.

And I think he feels 20, 30, 40 years from now, people will remember him -- and you know presidents get one or two lines -- as the guy who did universal health care. In foreign policy terms, I think he wants to be the man who moved America and America's attention squarely to Asia, who made America a Pacific power because he recognizes to be a superpower in the 21st century, you have to be a Pacific power.

And I think he wants to, you know, get us out of the Middle East, lower the military footprint of America's involvement in a region that I think he feels at the end of the day, there is just a lot of problems without a lot of benefits.

J. KING: You mentioned Asia. During the campaign, Governor Romney went first and then pushed and nudged the president a little bit to take a tougher stance towards China. There are national security questions about China. There are bigger economic questions about China. Will that disappear or will the president have to be at least for a while tougher with Beijing?

ZAKARIA: I think it will grow.

Look, China and the United States are not headed in a good place for economic reasons, for geopolitical reasons. There are kind of incentives and structures bringing the two countries into a certain degree of conflict.

Remember, many of the pressures we feel here, there are similar pressures in China, there are lobbies in China that feel that the Chinese have been too accommodating to the United States. They need to stand up to them. They are, after all, so the argument goes in Beijing, they're the largest creditors of the United States.

And they should use that power in some way. So I think that unless this relationship, which is going to become the critical relationship of the 21st century, unless it is well-managed, we could find ourselves almost unintentionally with more conflict than we want. We don't want a trade war between the two largest economies in the world.

J. KING: Fareed Zakaria, as always, thanks, my friend.

ZAKARIA: Thank you, John.

J. KING: Brooke, always good the day after an election, we stop counting, we start thinking about policy and governing. It's good to have a smart guy on your team.

BALDWIN: It's wonderful to have smart guys on the team.

While most Americans had their eyes glued to who would be elected president last night, voters in two states approved same-sex marriage for the first time at the ballot box. Ahead, we will look at whether this is a turning point here for gay rights in this country.

(COMMERCIAL BREAK)

BALDWIN: You know, this election could be a major turning point for gay rights and really for the country, voters in two states saying I do to same-sex marriage. Take a look at the results here from Maryland. We will show you Maine here in a moment. But keep in mind, Maryland and Maine join now six other states that already allow men to marry men and women to marry women.

But Maine and Maryland here, they're setting a precedent because they're the first states to see gay marriage approved by voters and not just judges or lawmakers.

Want to bring in CNN senior legal analyst Jeff Toobin, live for me in Washington.

Jeff, obviously, this is historic, at least in these two states, that gay rights won out. When we look at the numbers here, where the same- sex marriage vote stands -- this is Washington State. Ballots are still being counted. Was this a big surprise to you?

JEFFREY TOOBIN, CNN SENIOR LEGAL ANALYST: It was.

All the polls were very close. It is not a big surprise, but, look, when it is the first time, and, remember, 30-plus states had taken public votes on same-sex marriage over the previous decades, and not once had it passed, including even liberal states like California in Proposition 8 a few years ago.

The fact that the voters have spoken on this issue is a very big deal and it could really mark a sea change on this issue as public opinion polls are marking a sea change on how people feel about same-sex marriage.

BALDWIN: The fact that voters specifically have spoken here in Maryland and Maine, especially Maine, because they did a 180 from the last time they were voting on this particular measure, do you think that this is potentially a sign, a harbinger of things to come in terms of more victories in this country for gay rights?

TOOBIN: Well, certainly the trend is entirely in this direction. Think about 2004, which is, after all, isn't that long ago, eight years ago.

Karl Rove and the Republican Party said, look, how can we build turnout in states like Ohio? I know, we will put a referenda against same-sex marriage on the ballot, so that will generate a lot of anger and hostility and turnout against same-sex marriage.

That doesn't work anymore. Even after President Obama declared his support for same-sex marriage, Mitt Romney didn't make an issue out of it, the Republicans didn't make an issue out of it. It just illustrates how quickly the tide appears to have turned in terms of how the public feels about same-sex marriage.

BALDWIN: As you point out, though, the margin is small, but the tide is turning. But when you talk to opponents, let me quote the Maryland Marriage Alliance -- quote -- "Such a radical change in the definition of marriage will produce a host of societal conflicts that government exercising its enormous enforcement powers will have to resolve."

Jeff Toobin, where does this go next, to the federal government, potentially to the Supreme Court?

TOOBIN: Well, the Supreme Court has two possible cases this term, one, the constitutionality of the Defense of Marriage Act, the other whether Proposition 8, the California laws, is constitutional. So certainly we're going to hear from the Supreme Court whether they're going to hear those cases in relatively short order.

Other than that, the federal government is going to have to deal with some cases, some issues regarding reciprocity, do they honor, you know, same-sex marriages, but, mostly, I think it will be in the courts and the states over the next few months and the next few years. And it certainly looks like times are changing.

BALDWIN: Times are changing.

Jeffrey Toobin, thank you -- John King, to you.

J. KING: Up next, Brooke, hate to say this, forget the celebrations, folks, fiscal cliff staring down Congress and the president. Not much time to rest, this threat that impacts all Americans. Any minute, House Speaker John Boehner expected to speak live about where the talks stand with the president and the Democratic Senate.

(COMMERCIAL BREAK)

BALDWIN: Now that we know who the next president is, let me just let you know what we will be talking about next, that being the fiscal cliff.

These are live pictures as we are awaiting House Speaker John Boehner. He will be talking about the fiscal cliff, President Obama and Congress. They have to cut a deal or trillions of dollars worth of tax increases and spending cuts will kick in the 1st of the year.

We do know that the president called Speaker Boehner and other congressional leaders from Chicago, very early today, to talk about the legislative agenda for the last few days, months of this year.

J. KING: Speaker Boehner, Brooke, saying there is no mandate for raising tax rates. He said he had a pleasant conversation -- this is the speaker -- with Senate Majority Leader Harry Reid this morning and he says he's not drawing lines in the sand.

Now, meanwhile, the Leader Reid may be signaling, can't we work things out?

(BEGIN VIDEO CLIP)

REID: It is better to dance than to fight. It is better to work together. Everything doesn't have to be a fight. Everything doesn't have to be a fight. That's the way it's been the last couple of years. So everyone should comprehend, especially my Senate friends, that legislation is the art of compromise. It's consensus-building.

(END VIDEO CLIP)

BALDWIN: That was leader Harry Reid. We are 60 seconds away, just about, from Speaker Boehner.

Let me just bring in here Jill Dougherty. She's covering the White House for us today, and our senior congressional correspondent, Dana Bash.

Dana, in the moments we have remaining -- we will just cut away when we see the speaker in that live picture, as we are all sort of watching.

We know he indicated Sunday temporary fix might be in the works during the lame-duck. Post election, might that change?

DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT: As far as we're told, at least his opening bid will be, no, it won't change. He very much believes that the temporary fix does not work, and particularly because you're talking about a lame-duck Congress.

But I just have to give you a little bit of information that Deirdre Walsh and I got on a conference call that the speaker just wrapped up with his entire Republican conference or caucus.

And he was starting out the call, we're told, really trying to buck them up, saying that we're not going to give in on our principles, that we, the House Republicans, are the firewall between the Republican -- the Democrats in the senate and -- oh ...

BALDWIN: There he is.

BASH: I'm going to stop talking. There's the speaker.

BALDWIN: Let's go. Let's take him live.

REPRESENTATIVE JOHN BOEHNER (R), HOUSE SPEAKER: Good afternoon, everyone.

Let me start by offering my congratulations to President Obama and the first lady and to Vice President Biden and Dr. Biden.

Like many Americans, I was hoping that this presidential election would turn out a little differently. Mitt Romney and Paul Ryan are good men and they're good leaders. I want to wish Mitt, Ann, Paul and Janna and their families well. But the American people have spoken. They have re-elected President Obama and they've again re-elected a Republican majority in the House of Representatives. If there's a mandate in yesterday's results, it is a mandate for us to find a way to work together on the solutions to the challenges that we all face as a nation.

And my message today is not one of confrontation, but one of conviction. In the week and months ahead we face a series of tremendous challenges and great opportunity.

Just weeks away from now looms the so-called fiscal cliff, a combination of automatic spending cuts and tax increases mandated by law. Within months of the fiscal cliff, congress will be asked to raise the nation's debt ceiling.

Around the same time, legislation will be needed to keep the government running as the continuing resolution under which we're currently operating expires. Amid all of the short-term hurdles, we face the greatest challenge of all, a massive debt that is smothering growth and exceeding the entire size of our economy.

There will be many who will say that with the election over, we should confront the first of these challenges by simply letting the top two tax rates expire and pushing the sequester off to some other date.

They'd have us engage in the same short-term temporary policies that have helped put us into this fix. In essence, they're saying let's have more of the same. Let's agree to drive our economy off part of the fiscal cliff instead of driving it off the whole fiscal cliff and we'll call it a day.

You know, that might get us out of town, but it won't get us out of the problem and it will also hurt our economy. We can't keep going on like that and we can't keep setting the bar that low. It's time that we raised the bar.

You know, the American people this week didn't give us a mandate to simply do the simple thing. They elected us to lead.

They gave us a mandate to work together to do the best for our country and we know what the best thing to do would be. That would be an agreement that sends the signal to our economy and to the world that after years of punting on the major fiscal challenges that we face, 2013 is going to be different.

It would be in agreement that begins to pave the way for long-term growth that is essential if we want to lift the cloud of debt that is hanging over our country.

Now, we won't solve the problem of our fiscal imbalance overnight and certainly won't do it in a lame-duck session of Congress. And it won't be solved simply by raising taxes or taking a plunge off the fiscal cliff.

What we can do is avert the cliff in a manner that serves as a down payment on and a catalyst for major solutions enacted in 2013 to begin to solve the problem.

Mr. President, the Republican majority here in the House stands ready to work with you to do what's best for our country. That's exactly what I told the president earlier today. That is the will of the people, and we will answer to them.

And doing what's best means fully considering the impact of the policies that we might set in motion. You know, the independent accounting firm Ernst & Young says going over part of the fiscal cliff and raising taxes on the top two rates would cost our economy more than 700,000 jobs.

Ernst & Young also confirmed that many of those hit with a rate increase will be small business owners, the very people who both parties acknowledge are the key to private sector job creation.

There's an alternative to going over the fiscal cliff, in whole or in part. It involves making real changes to the financial structure of entitlement programs and reforming our tax code to curb special interest loopholes and deductions.

By working together and creating a fairer, simpler, cleaner tax code, we can give our country a stronger, healthier economy. A stronger economy means more revenue, which is what the president seeks.

Because the American people expect us to find common ground, we're willing to accept some additional revenues via tax reform. There's a model for tax reform that supports economic growth. It happened in 1986, with the Democrat House run by Tip O'Neill and a Republican president named Ronald Reagan.

In 1986, there too were skeptics who doubted the economic benefits of tax reform. Well, those skeptics were wrong. As Stanford economist and former Treasury Secretary George Schultz put it, the 1986 reform is the sort of unsung hero of the very good economic times we've had for a long time.

The time has come again to revamp the tax code and, if we do, he argues, we'll get a gusher and there will be a response and revenue will come in.

But the American people also expect us to solve the problem and, for that reason in order to garner Republican support for new revenues, the president must be willing to reduce spending and shore up entitlement programs that are the primary drivers of our debt.

If we're -- if we aren't seeking to impose our will on the president, we're asking him to make good on his balanced approach. The president has called for a balanced approach to the deficit, a combination of spending cuts and increased revenues, but a balanced approach isn't balanced if it means higher taxes on small businesses that are the key to getting our economy moving again and keeping it moving.

A balanced approach isn't balanced if it means that we increase the amount of money coming into the coffers of government, but we don't cut spending and address entitlements at the same time. A balanced approach isn't balanced if it's done in the old Washington way of raising taxes now and ultimately failing to cut spending in the future.

A balanced approach isn't balanced if it means slashing national defense instead of making the common sense spending cuts that are truly needed.

Real economic growth eluded us in the first term of this president and, without it, we can't solve our debt problem. And for the purposes of forging a bipartisan agreement that begins to solve the problem, we're willing to accept new revenue under the right conditions. What matters is where the increased revenue comes from and what type of reform comes with it.

Does the increased revenue come from government taking a larger share of what the American people earn through higher tax rates? Or does it come as a by-product of growing our economy, energized by a simpler, cleaner, fairer tax code with fewer loopholes and lower rates for all.

And at the same time we're reforming a tax code, are we supporting growth by taking concrete steps to put our country's entitlement programs on a sounder financial footing or are we just going to continue to duck the matter of entitlements, thus the root of the entire problem?

Shoring up entitlements and reforming the tax code, closing special interest loopholes and deductions and moving to a fairer, simpler system will bring jobs home and result in a stronger, healthier economy and history teaches that this is the right path to take.

Tax reform done in a matter in which I've described will result in additional revenue that the president seeks. It will support economic growth which means more revenue generated for the treasury and it will improve the efficiency of the tax system, which means additional revenue, as well.

Listen, we're closer than many think to the critical mass that's needed, legislatively, to get tax reform done. The president and I talked about it extensively during the summer of 2011.

Senator Pat Toomey and Chairman Jeb Hensarling with the support of other Republicans offered substantive proposals in the so-called Super Committee last year that provided revenue via tax reform.

Now, the American people recognize that our economy, getting it moving again, is the only way we'll be able to balance the federal budget. The question we should be asking is not which taxes should I raise to get more revenue, but which reforms can we agree on that will get our economy moving again?

There are two paths we can take to get to revenue the president seeks. Feeding the growth of government through higher tax rates won't help us solve the problem. Feeding the growth of our economy through a better and cleaner tax code will. Now, the president has signaled a willingness to do tax reform with lower rates. Republicans have signaled a willingness to accept new revenue if it comes from growth and reform, so let's start the discussion there.

I'm not suggesting we compromise on our principles, but I am suggesting we commit ourselves to creating an atmosphere where we can seek common ground where it exists and seize it.

And if we can't find common ground, it means we'll continue to operate on a tax code on a year-by-year basis. It means we will continue to extend major programs for a month at a time. It means we'll continuously face expiration of the government's borrowing authority. And we'll be on constant downgrade watch from our creditors.

In the New Testament, there's a parable told of two men, one who built his house on sand, the other who built his house on rock. The foundation of our country's economy, the rock of our economy, has always been small businesses and the private sector.

I ran one of those small businesses and I can tell you that raising a small business's taxes means they don't grow. If small businesses don't grow, our economy doesn't grow. And if our economy doesn't grow, we don't have a prayer of digging our country out of the hole that we call our national debt.

This is why going over part of the fiscal cliff and raising taxes on job creators is really no solution at all. Instead of building our house on sand, let's build it on rock. Instead of raising small business taxes, let's start by fixing their problems.

Let's start by giving them some confidence and certainty about what the future holds and, for this to work, we need to plan for a serious process, focused on substance, not on theatrics.

It will require weeks of work, rather than a weekend of photo-ops. It won't happen around a campfire at Camp David or in a secret room of some Air Force base or, as much as I'd like, over 18 holes of golf.

I think this is going to take time, but if we're all striving for a solution, I'm confident that we can get there.

Mr. President, this is your moment. We're ready to be led, not as Democrats or Republicans, but as Americans. We want you to lead, not as a liberal or conservative, but as president of the United States of America.

We want you to succeed. Let's challenge ourselves to find the common ground that has eluded us. Let's rise above the dysfunction and do the right thing together for our country.

Thank you, all.

JOHN KING, CNN CHIEF NATIONAL CORRESPONDENT: The Republican House Speaker John Boehner delivering his first post-election statement, focusing exclusively on the country's decisions, the decisions the country has to make as it heads into what they call the fiscal cliff.

Our senior congressional correspondent Dana Bash is still with us. Jill Dougherty is standing by at the White House.

Dana, to you first. There was some conciliatory words in there, but as he planted the first flag, he essentially said, Mr. President, you need to acknowledge you're going to cut entitlement programs and you need to give up on your biggest short-term goal, which is essentially the expiring Bush tax cuts, higher taxes on the wealthy.

Speaker Boehner saying no.

BASH: Right. I mean, that's pretty much exactly what he said, if you read between the lines, but the tone really deserves to be highlighted because it is a different tone. And you know what? Tone does matter here in this city, particularly given what we've seen over the past couple of years.

Harry Reid was the same way, being very conciliatory, but he was very clear and it was interesting the way he sort of tried to throw what the president and he discussed, which didn't go anywhere about a year ago on debt relief, in his face, essentially, saying that you did agree during those talks to tax cuts that are lower than they are now, so, you know, you do have it in you somewhere.

But he also made clear that he's going to stick to his idea that a temporary fix is not going to work. He wants to do something long- term, tax reform, entitlement reform.

One other thing I will tell you just about the politics of where he is. He had a conference call with his conference just before going on at this press conference and he really tried to buck them up and saying, look, guys, you've got to stick with me.

But he also, we're told, made very clear in this private conference call that these members of the House Republican conference have just got to follow him and that he is going to, in his words, make sure that he doesn't get boxed out by the White House, but also doesn't get boxed in.

KING: Doesn't get boxed in.

Jill Dougherty, the president placed that phone call. Speaker Boehner alluded to it. If you listen to the speaker there, he wants the president to blink first. The president just won a campaign, kept his coalition intact, including people who say, Mr. President don't cut Medicare; including people who say, Mr. President, you better get those higher taxes on the wealthy.

Are we in a high stakes game of chicken. Is that essentially what this is, who blinks first?

JILL DOUGHERTY, CNN FOREIGN AFFAIRS CORRESPONDENT: Yeah, I think it's the opening gambit, you could say, in this chess match which will try to put the president in a slightly difficult situation because, after all, what they're saying is, we'll -- we will be willing to increase taxes if you revamp the tax code and, most importantly, if you reduce the entitlements and that's the nub. That's the issue right now.

So -- but I do agree with Dana that there is a different tone. He is saying, we want to be led. That's a very interesting phrase. We want to be led.

But all of this, as we've been reporting, he's using a teleprompter. This is very carefully phrased. It is, you know, read the fine print, because right now we're going into some very important, but very complex period of negotiating the way out of this.

KING: The opening markers being placed. Jill Dougherty at the White House, Dana Bash here in studio and, Brooke, as we throw it back to you, this is -- we had an election. We had the results.

We know what Congress is going to look like, we know what the White House is going to look like and this is one giant, important question- mark as the country teeters on the edge of that fiscal cliff.

BALDWIN: But, you know, to the point of your conversation about Speaker Boehner's tone, did you notice the color of his tie?

BASH: Purple.

BALDWIN: Did you notice that? Purple. Just saying. Maybe it was the first thing he grabbed when he was in his closet this morning, but I feel like there is no coincidence in politics these days.

Guys, thank you all so much.

You know, it's no secret the relationship between President Obama and Israeli Prime Minister Benjamin Netanyahu is, shall we say, a complicated one.

So, how will these two work together in the president's second term? CNN's chief international correspondent Christiane Amanpour giving us a little perspective, next.

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BALDWIN: Let me just bring her right in. She is CNN's chief international correspondent, Christiane Amanpour, joining me live from New York.

Christiane, nice to see you here on this day after election day. Huge, huge win, obviously, for the president of the United States, four more years, but let's talk big picture here.

I mean, looking ahead, in terms of the global economy, what is the one thing the president needs to do in order to sort of help the world, economically speaking?

CHRISTIANE AMANPOUR, CNN CHIEF INTERNATIONAL CORRESPONDENT: Well, you know, you just heard Speaker Boehner talk about what needs to be done to avoid this fiscal cliff and he said, clearly, we need to send a message not just to the United States, but to the world that 2013 is going to be different. And today some of the reaction around the world has been one of some sort of eagerness to see whether the gridlock in American government, this gridlock in Congress that we have seen and we've reported on for so many months and years now will give way to some bipartisan action to make sure that the economy can move forward and this fiscal cliff is avoided.

Because they're very concerned in Europe and beyond and you can see the dramatic implosion of the eurozone today with the Dow dropping, all the problems we have got in Greece with the austerity that parliament is considering and, on top of that, to think that there could be some fallout from a U.S. fiscal cliff going over, that is not what they want.

BALDWIN: And here we have live pictures of the Dow, tanking here. 10 minutes before the closing bell, down almost 300 points here.

So, as we look at the economy moving forward, as Speaker Boehner points out 2013 a big year, I want to ask you about the relationship between the president and Israeli Prime Minister Netanyahu because he had a not-so-secret preference for Mitt Romney this election.

Their relationship goes back years and years and years. In fact, I was reading one of the Israeli newspapers. "Israel Today" ran no fewer than four opinion pieces just yesterday endorsing Romney.

What happens now, Christiane, in this relationship between Netanyahu and Obama?

AMANPOUR: Well, what happens now is that Obama is the president of the United States, Netanyahu is the prime minister of Israel and they have to work together.

These are two countries which stand side by side. There is no doubt in anybody's mind that the United States stands firmly for the security of Israel. The international community knows it.

Yes, there has been a very cool relationship between Prime Minister Netanyahu and President Obama. However, Netanyahu did congratulate the president this morning and he said the strategic reliance between Israel and the U.S. is stronger than ever. I will continue to work with President Obama in order to assure the interests that are vital to the security of the citizens of Israel.