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Obama Remarks On Economy Soon; GOP "Veep Stakes" Under Way; Santorum Unveils "Patriot Voices"; Former President Clinton Regrets Comments; CNN Poll: Most Oppose Health Care Law
Aired June 08, 2012 - 10:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CAROL COSTELLO, CNN ANCHOR: Good Friday morning to you. I'm Carol Costello. Just minutes from now President Obama is due to deliver a statement at the White House, his focus, the economy, an issue resonating deeply with Americans and looming large in this fall's presidential election.
"State of the Union" host Candy Crowley joins me now. This is sort of a surprise news conference isn't it?
CANDY CROWLEY, CNN CHIEF POLITICAL CORRESPONDENT: Well, it is and it's one of the beauties of being president is that you can come and call and produce and create news all at the same time by just kind of walking down the hall from your office.
It's not been a great several days for the president, as a candidate. I can understand why he might want to do this. We saw those May jobless figures, which were not good like 69,000 jobs created, which is still a plus but not nearly enough.
And everyone was sort of stunned by them because they thought they would be double than that. We've had the Wisconsin recall race where the Democrats lost and pretty roundly.
So I think when you're coming to the end of a week like that, he's getting hammered up on Capitol Hill about all these leaks. It's probably a good time to come out and put your spin on things and put your case out there. So I suspect that this is about the past several days.
COSTELLO: He's going to present a proposal that he's presented before. Do you think there will be a bunch new?
CROWLEY: I think what this -- again, if we look at this because it's an election year so we have to look at it through that prism whether we want to or not. The fact of the matter is that one of the president's main themes of his re-election campaign is, I would do this, would be so much better off if Congress would just do something.
So he's going to reiterate, like I asked you before, Congress, we could just create construction jobs, if you would only pass this infrastructure bill for me. So that also is sort of part and parcel of that.
And in addition he honestly, obviously thinks that's the way to go about creating jobs. He wants the bill but also part of his campaign to hammer on Congress as kind of the do nothing Congress.
COSTELLO: He's sort of running now not necessarily against Mitt Romney, but against the Republican Party?
CROWLEY: Sure. And Congress has been something that he's been quite willing and started several months ago to say I just want them to do something. He's, you know, writes these to-do lists for Congress.
He hammers them regularly for not passing things he's done and what is the message there? The message is I'm trying to create jobs, but I need a helping hand from Congress and that's a, you know, it's all about saying your message.
And then saying it again and again and again and that, obviously is what you do if you want to win re-election and if you want to unseat the president. Both sides do this obviously.
COSTELLO: OK, Candy, you're going to stick around. Thanks so much.
Again, the president due to speak in about 12 minutes or so if he's on time. When the president begins speaking about his jobs proposal, of course, we'll carry that for you live.
Also we're covering all angles of the president's statement. In just a few minutes, Wolf Blitzer will bring in Ali Velshi and Christine Romans to talk the business side of the president's comments and also for the politics, Jessica Yellin, Kate Bolduan and of course, Candy Crowley.
In other news this morning, for Republicans the guessing game is under way. Who will Mitt Romney chose as his running mate? The veep stakes buzz getting louder today as conservative leaders and activists launch their biggest gathering the year in Mr. Obama's backyard. That would be Chicago.
On stage at the conference, former presidential candidates Michelle Bachmann and Rick Santorum, New Jersey Governor Chris Christie and one time Romney challenger, Herman Cain.
Also this morning, Santorum announced the launch of a new organization aimed at defeating President Obama. Santorum says "Patriot Voices" will recruit and mobilize one million people, one million conservative people to advance their causes and raise money for like-minded candidates.
More on presidential politics now. Bill Clinton said he's sorry, he's so sorry. The former president is on the stump for Barack Obama, but he hasn't always been on the same page with the campaign's talking points.
Just in the past week, Clinton raised eyebrows when he praised the business success of presumptive Republican nominee Mitt Romney. And he appeared to side with GOP themes when he voiced support for extending the Bush era tax cuts.
Clinton sat down to explain with Wolf Blitzer.
(BEGIN VIDEO CLIP)
WOLF BLITZER, HOST, CNN'S "THE SITUATION ROOM": Some of your critics have said, you know, the former president is undermining the current president for whatever reason.
BILL CLINTON, FORMER U.S PRESIDENT: Look, in 2008 when he ran for president and defeated Hillary in the primaries, I did 40 events for him, 40 in the election.
In 2012, I have done these major fundraisers. I have spoken up for him whenever I could. I have told people repeatedly I think he's done a good job. A really good job under very trying circumstances and better than some people give him credit for.
And I'm strongly committed to his re-election. And I just regret -- you know my instinct, though, you know me, I don't think I should have to say bad things about Governor Romney personally to disagree with him politically.
The fact that I was complimentary of his success as a business person doesn't mean that I think that he should be elected and President Obama shouldn't.
(END VIDEO CLIP)
COSTELLO: Republicans have seized on the apparent conflict though and tried to use Clinton's words against Obama conspiracy theorists even suggest sabotage saying Clinton is laying the ground work for a future presidential bid for his wife, Hillary.
The Supreme Court could hand down a ruling as early as Monday on a major case, the president's health care law. Our new poll shows that bare majority of Americans, 51 percent still oppose the law.
So let's dig deeper into these numbers. Paul Steinhauser, our political editor, is here. Paul, it's not just conservatives who are against this law.
PAUL STEINHAUSER, CNN POLITICAL EDITOR: Exactly. So let's break down that number, Carol, that you just showed from our new CNN/ORC national poll.
Take a look at this. There's that 43 percent who favor the law, but of those who don't favor it. Well, look at this, 34 percent they oppose it because it goes too far. It's too liberal.
But look at the bottom, 13 percent. Guess what they say? You know what? I don't like the law because it doesn't go far enough. It's not liberal enough.
So what do Americans want the Supreme Court to do? Take a look at this number from CBS/"New York Times" also new just in the last 12 hours. You can see here about a quarter, just under a quarter want the Supreme Court to keep the entire law the way it is.
A little over a quarter want the mandate that controversial individual mandate overturned and about four in 10, they say overturn the entire law.
Carol, here's one thing you can bank on. Regardless of how the Supreme Court rules, whatever it does as early as Monday, maybe later this month, it's going to have an impact on the race for the White House. Why?
Because health care and this controversial law definitely is bringing out strong feelings either in favor or against the law by voters across the country and it comes up all the time, candidates speak about it all the time -- Carol.
COSTELLO: There's another interesting number out of that poll and it's how the people feel about the Supreme Court justices and how they will make their decision.
STEINHAUSER: Yes, and you know what? Not as favorable as you would think. The CBS poll is indicating that maybe the Supreme Court not as favorable in the minds of Americans as you would think, very interesting numbers -- Carol.
COSTELLO: No. Actually said most Americans think the Supreme Court justices would make their addition based on partisan lines not necessarily, you know, what they are supposed to do. Thought that was interesting.
STEINHAUSER: Exactly. It just goes to show the partisanship in this country reaches the Supreme Court, which you think would be immune from that, but I guess not. Nothing is immune now a days -- Carol. COSTELLO: I guess not. Paul Steinhauser live from Washington, thanks.
Right now, we're keeping a close eye on the White House where President Obama is about to speak. He's going to comment on the economy, an issue deeply important to Americans and, of course, casting a long shadow in this fall's presidential election.
The president expected to be behind that podium in about 10 minutes. We want to set the stage for the comments and their significance. CNN's Wolf Blitzer is in our Washington bureau. Hi, Wolf.
BLITZER: He's been trying, Carol, as you know, to make it clear that Congress is the problem right now, that there's legislation that's pending that could stimulate the economy, create jobs.
And I suspect we're going to hear from the president some strong words on Congress needs to do something over these next five months between now and the election, not just sit around and talk, waste time, but he's going to try to encourage them to go pass some legislation.
My own suspicion is probably not going to happen all that easily, maybe something on the margins, but substantive significant legislation in this political environment probably not going to happen.
Let me bring in Candy Crowley who's been watching Congress as I have. A lot of our viewers have for a long time. Candy, in this kind of political environment it really would take an extraordinary development to bring these two parties together right now.
We saw that in 2008 just before the election when it looked like the economy was about to go over the cliff. There was a recession that could have been a depression.
Then all of a sudden remember, John McCain, he stopped campaigning for a few days to come back to Washington. It's going to take something like that, I suspect to get Congress to move.
CROWLEY: Right. Let's hope it's not something like that, but I think you're exactly right in the comparative, which is right now these sides are deeply dug in policy wise and politically.
And the Republicans are going to come out and say wait a second, the House has passed 30 some bills and the Senate won't act on them. You're going to hear the same arguments even as the president pushes.
I just want you to look, folks, it's not my fault, it's Congress's fault. So this is the pattern they have been in, as you know, for at least a year. There are no signs that it's going to break unless they have to move.
And even when they do have to move we talked about how the Bush era tax cuts are expiring at the end the year, some really huge spending cuts also are expected to go into effect the end the year.
Even that, most people suspect they will just push on down the line maybe pass something temporary and let the new Congress come in and deal with it.
So nobody is expecting, and this includes the lawmakers themselves and the White House, nobody is expecting anything huge, as you say. Maybe some stuff around the margins might pass.
But nothing huge in terms of the big debt deal, anything like that, because we're six months out from an election and it's just, the two sides are really hardened.
BLITZER: Yes, I think you're totally right. Let me bring in Ali Velshi into this conversation. Ali, one potential factor, game changer, if you will that could force dramatic action in Congress would be if the eurozone, if the economic situation in Europe and I suspect we'll be hearing from the president about what's going on in the European economies right now.
If there were some really awful, awful development that would have enormous spill over ramifications here in the United States, set the scene a little bit. Give us some background on how bad the situation is in Europe right now.
ALI VELSHI, CNN CHIEF BUSINESS CORRESPONDENT: Well, you know, we talked about this before. As Candy says the parties are hardened here in the United States and their economic position and many analysts say they can only tinker with things on the margins.
The two external factors, three external factors that are most worrisome are in United States are the slowdown in China and India because they are consumers of our products. The situation in Iran, which had caused oil to spike and as you know, oil was down to about $82 a barrel.
So that seems to have been pushed off into the future. The most important is this continuing European crisis, particularly if Spain gets near default or needs a bailout and of course, Greece continues not to solve its problems. This is a major issue. Why?
Because China -- we talk about China as our biggest trading partner, but as a whole Europe is as big an economy as the United States is and as we have been recovering in several fronts in the United States.
We have found that our consumers, those people in Europe who buy our goods have not bought. So I'll give you a good example. General Motors and Ford, which have seen a remarkable resurgence in the last year are suffering in Europe because Europeans can't get credit like we couldn't a few years ago and are not buying as much.
So the concerns about Europe dragging its heels and not coming to a solution to fix its fiscal and economic and debt crisis is becoming a very real problem at home and you've seen the sentiment, Wolf, in Europe about throwing out leaders because the economy has not improved.
President Obama who has been watching this economy slowly improve since he took office in the beginning of 2009 is now very, very concerned that that sentiment will come ashore in the United States and people will blame him for something that is going on in Europe and causing our economy to slow down.
BLITZER: Ali, stand by. I want to go Capitol Hill. Right now, Kate Bolduan, our congressional correspondent is standing by. Kate, I'm sure that once the president delivers his message to Congress and a big chunk of what his statement is going to be specifically will refer to actions that he wants Congress to take. There will be reaction from Republicans in the House and the Senate.
KATE BOLDUAN, CNN CONGRESSIONAL CORRESPONDENT: I think, Wolf, I believe it was Candy who mentioned this earlier. You can almost predict and I could almost lay out right now what you can expect to hear from Republicans in both, the House and Senate as well as the reaction we would likely get from Democrats.
Because, look, regardless of the president coming out now not a lot has changed in terms of the relationship between Congress and the president in these past few months. The president has been pushing this to-do list.
And he's been going out leaving Washington and kind of taking the show on the road to talk about these five items that he thinks that Congress can act on, should act on, that can offer some help, some economic -- spur some economic growth in the interim while they are talking about the big questions, big economic questions facing our country.
But there's no movement up here on Capitol Hill. Republicans think that the president is pushes these items and talking about the economy and blaming Congress in order to shift focus from what they call his failed economic policies of his presidency.
Democrats, of course, support the president's five-point to-do list, but do acknowledge they believe it is modest. If you're talking specifically about the to-do list, I believe it was last month in May, House Speaker John Boehner, he was asked about this to-do list.
And his response was that he thought that the president was playing small ball, and why he said that is they are already starting to talk about this fiscal cliff at the end the year. The president they say is talking about these, you know, smaller issues possibly. That's of course the Republicans perspective. Well, they are trying to deal with the fiscal issues, this fiscal cliff that's coming at the end the year.
But still while they are talking about it, there's not a lot of movement of how to break the logjam and get past the partisanship in order to reach agreement. The to-do-list items that the president has laid out have gone nowhere up here in Capitol Hill.
When you talk about the clean energy investment that's on the president's to-do list, as an example, just this week, House Republicans unveiled a proposal of a package of bills not having to do with clean energy, if you will, but actually having to do with producing more domestic oil.
So that's where their focus is. So the battle lines remain the same. We have to hear what the president says and of course, we'll be looking for reaction right after that.
BLITZER: I'm sure you'll be getting a lot of reaction. Kate, don't go too far away. Our chief White House correspondent, Jessica Yellin is in the briefing room getting ready for this briefing. Jessica, it's supposed to start about now. They haven't given us a 2- minute warning yet, have they?
JESSICA YELLIN, CNN CHIEF WHITE HOUSE CORRESPONDENT: No, no 2 - minute warning yet, Wolf. He should be coming out any moment. My guidance, although they haven't put out his remarks yet so that's always a tell-tell sign that he'll be here shortly. My guidance is when he does come out he'll speak for less than 10 minutes, and, you know, he will as we've been reporting sort of hammer Congress to try to get some of these measures past as soon as possible.
But it's no secret that in this election year, the president and the campaign are trying to run against Congress because they feel that Congress is essentially blocking them because Republicans don't in the view of many Democrats want the economy to do better before the election.
Of course, Republicans say that's not the case. But I do think that what you have seen is that after these jobs numbers came out last Friday, it was sort of a wakeup call here at the White House that they have to turn up the heat again.
They sort of let it, let it down in the last two months after they saw some positive jobs growth numbers. They want to turn up the heat again on Congress to get some of these measures done.
The president, as you know, has not had a very good week. Not only those bad job numbers. But after the Wisconsin recall, some of these moments where he's seen these surrogates go off message and all these concern about Europe as well, potential crisis in Europe that could come home and have ramifications here to make the economy even worse.
These are all things that are deeply concerning to the White House so what you're seeing is the president trying to take a proactive stance, calling on Congress to do something so that he's engaged and being forward moving in a sense.
And so the White House is trying to take control of our conversation, if you will, instead of being the recipient of all our talk and all our hand wringing about what will happen next -- Wolf.
BLITZER: And your guidance, Jessica, is that after the president makes his opening statement maybe 10 minutes or so he'll take a few questions from the reporters, is that right?
YELLIN: That's my understanding. I wouldn't call it a full blown press conference, but a few questions is what I understand is likely to happen. Again, though, you never know. So I'm told to expect a few, but we'll see.
BLITZER: I would assume he would answer a few reporters' questions. He's in a press briefing room and that's what reporters are expected to do when the president comes into the briefing room, ask questions and the president is supposed to answer some questions.
I always hate it when the president comes into the briefing room and just make a statement and escape without answering questions. I don't like that, but that's just me.
All right, get ready because I think he's going to be coming in any moment now. Let's bring in Christine Romans who is watching all of this unfold.
You know, the economy, at least a lot of forecasters, Christine, projecting about a 2 percent annual growth rate now. That's really not enough to create a whole lot of jobs.
That's basically maybe enough to tread water and not start losing jobs, but if you're going create jobs you need a lot more than 2 percent.
CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: You do. The head winds right now are telling us that, you know, the U.S. economy could slow from this level. The growth could slow down a little bit. Here's why.
I mean, we've been waiting for Europe's problems to reach our shores for some time. We now, Wolf, have the first evidence that that's happening. I mean, U.S. exports to the eurozone are down 4.7 percent from January to April.
That means Midwest manufacturers, apparel companies, anybody who is selling something to Europe is selling less and that means they have less impetus to hire somebody in this country and certainly not ramping up hiring plans from now to the end of the we're if they think Europe will continue to slow.
So that is a really big problem. The big difference between the last time the president laid out this package of things that he wanted Congress to do, as you know, his to-do list for congress and today.
Europe's problems have reached American shores, and the job situation is very, very critical. You can talk about the war on women whether there is one or isn't one. You can talk about student loan interest rates.
You can talk about all of these little things that affect American families and constituents, but the big thing is still jobs and the president is under incredible pressure to find a way to make sure the job situation gets more robust, the U.S. economy stays more robust as Europe's problems worsen.
BLITZER: Yes, because a lot of folks really don't necessarily fully appreciate how interdependent the United States economy is with the European economy and then when you add what's going on in China, a huge market over there.
If there's going to be a slowdown in economic growth in China right now that can really have an negative impact on economic growth across the board.
So we're less than two weeks or so, Christine, from the G-20 Summit in Mexico where most of these big powers, all these world leaders are going to be getting together, and certainly the economy is issue number one.
ROMANS: Yes. You look at Europe in particular. I mean, China is a huge economy and growing very quickly. There are concerns about how it's slowed down a bit in the phase of its economic growth.
But you look at Europe. The eurozone is our largest customer. This is the largest destination, single destination zone for U.S. exports. So if you got members of the eurozone who are in recession and there are several of them.
That's just not good for people who make goods and hire people in this country. It goes far beyond the interdependence of the banks and financial crisis and financial situation. It comes down to American workers making things going to Europe and I mean, that is a real problem.
You can see these in these numbers that those exports are slowing. This is all staring the president in the face with five months to go. The question here, I was just talking to Ron Brownstein in the hallway too and the question here that's so interesting, Wolf, to me is this is last year's package of solutions for problems that are last year's problems, but also this year's problems with new twists.
So the president has got to show -- he's got to show some leadership to get some of these things, some of these things addressed. The political savviness I think, Wolf, is we're talking about jobs for teachers, firefighters, construction workers, to do things for infrastructure spending that all Americans would benefit from.
So politically these are things that you would think, you would think you can't really go against hiring more firefighters, I guess, but nothing is getting done in Washington, right? Nothing is getting done.
BLITZER: Nothing getting done on a significant basis. All right, let's take a quick break. We'll wait for the president. He's about to walk into the press briefing room over at the White House, make a statement, and hopefully answer a few reporters' questions. Our coverage will continue right after this.
(COMMERCIAL BREAK)
BLITZER: We're awaiting the president of the United States. He's about to walk into the press briefing room in the west wing of the White House, make a statement on the economy, what he wants Congress to do try to pass legislation to create some jobs.
And the president hopefully will then answer a few questions. All of our reporters and analysts are standing by. We have full coverage right now, Jessica Yellin, Kate Bolduan, Candy Crowley, Ali Velshi, and Christine Romans.
Jessica Yellin is in the White House press briefing room. Jessica, they just announced that the president would come in to the briefing room a little while ago. This was not on his schedule going into today.
YELLIN: No, it wasn't, Wolf, but they have been making clear that after those jobs numbers that came out on Friday, which were a surprise to the White House, that he was going to step up the offensive on Congress and make it clear that they want more action to push forward.
You remember he first proposed this jobs bill back in September of 2011 and very few elements of it have actually passed. So this is not only an effort to jump start, you know, their agenda on the economy, but also let's be honest, push forward on their election agenda.
He has a new ad out this week as part of his campaign effort called jobs and it includes a message to Congress to get going on the jobs bill. So, we can see it as all of a piece, no doubt, and we will hear from the president pushing Congress to do more to get this measure passed.
This isn't the only issue that deeply concerns him as we've been talking, they are also keeping an eye on the eurozone and trying to warn the American people that this is a potential looming crisis and something that the American people should be aware is out there.
And could threaten the U.S. economy down the line as well so we could potentially hear something from him on that, not sure in his opening statement, but I wouldn't be surprised if he gets a question on it -- Wolf.
BLITZER: Yes, all right, stand by. Everyone stand by. We're still waiting for the president. We'll take another quick break and our coverage will continue on the other side.
(COMMERCIAL BREAK)
BLITZER: We have a two-minute warning?
All right. So we're awaiting the President. We just received the two-minute warning. The President will be walking into the press briefing room and will make a statement on the economy. You see the reporters there in the briefing room. They are standing by. They are getting ready for the President.
As we await the President let me just bring in Carol Costello, there are a few other stories we're watching right now. Carol, what's the latest?
COSTELLO: All right good morning to you. Good morning everyone.
Here is a couple of stories we're keeping an eye on this morning. Health investigators racing to find the source of a reported E. Coli outbreak in four southern states, 11 people have gotten sick including a 22-month-old girl who died in New Orleans last week.
Other news this morning -- for Republicans the guessing game is now under way who will Mitt Romney choose as his running mate? The Veep stakes buzz is getting louder today as conservative leaders and activist launch their biggest gathering of the year in Mr. Obama's backyard, Chicago. On stage at the conference, former presidential candidates Michele Bachmann and Rick Santorum, New Jersey Governor Chris Christie and one time Romney challenger Herman Cain.
Also this morning Santorum announced the launch of a new organization aimed at defeating Obama. Santorum says, "Patriot Voices will recruit and mobilize one million conservatives to advance their causes and raise money from like-minded candidates."
There's been fallout from the recent leaks of classified information in Washington. Both the House and Senate Intelligence Committees are vowing full blown investigations into the national secrets that keep being funneled to the media. The FBI is looking into whether the White House is to blame. Lawmakers from both parties say someone needs to go to jail.
It's not a labor union but 5,000 Wal-Mart workers have come together to fight for better wages. The Organization United for Respected Wal-Mart called "Our Wal-Mart" is also pushing for more consistent work schedules. The employees move come as Wal-Mart tries to hold down expenses in order to cut prices at its stores.
Ok. Hopefully the President will be behind that podium momentarily. Let's throw it back to Wolf Blitzer.
BLITZER: Carol, thanks very much. We expect him to be walking into the press briefing room within a matter of only a few seconds. They told us about two minutes ago that he would be walking in. So we assume he'll be walking in momentarily.
The President will be making what is described as about a ten minute statement on the economy and what he wants Congress specifically to do. We expect that he will also refer to the economic turmoil, the crisis in Europe right now, especially in Greece, Spain, Italy, Portugal; how that potentially could spill over in the United States on the U.S. economy. Deep concerns here that what's going on in Europe could have a dramatic impact in terms of the economic recovery, jobs creation, making what is not necessarily a great situation potentially even worse, a lot worse potentially in the United States.
And Jessica Yellin, as we await the President let me bring you in to this conversation a little bit. The President, you know, you have to assume that everything he does, we only have five months before the election is also done within a political context.
JESSICA YELLIN, CNN CHIEF WHITE HOUSE CORRESPONDENT: That's right Wolf. I mean, they know that this is a bad hit, the numbers -- jobs numbers they got on Friday were a bad hit because people are starting to just focus in on the election right now; most people who are voting, just zooming in right now.
And so the President trying to take the lead and reframe the discussion, if you will and try to tell Americans that there is still time to do something to turn around the nation's economy. And in his view what it is, is push forward on both the jobs act that he proposed in September of 2011 and also on this congressional to-do list we've heard a lot about. One of the measures they think can make a big difference is, for example, this refinancing package that they put before Congress which could help they believe so many homeowners.
There are a number of items, I know you've gone through them, we don't have to get into the detail here, he will. But their main message is that the U.S. is not helpless and he believes that it's up to the folks on the other end of Pennsylvania Avenue to work with him to get more done because there are other factors that are out of the U.S.'s control that can impact our economy, namely the crisis in Europe.
So the U.S. needs to do more to protect itself now while it can from these outside events should they happen. Of course, now Republicans have a very different take and they insist that they've passed other measures that the Democrats won't accept and so there you have what we call gridlock.
But here the President trying to both push forward substantive measures but also make an election year point that he's trying and he's being stymied by the Republicans. And I think that's what you'll hear him say today as well as make a point about Europe being a threat to the U.S. because of the economic crisis over there -- Wolf.
BLITZER: All right. Jessica, stand by. We were told the President was going to be walking out within two minutes. That obviously has not happened. Candy Crowley is watching all of this unfold with us as well.
Candy, we'll get reaction certainly from the Republicans in Congress very quickly but you know who is watching this most closely would be the Mitt Romney campaign including the Republican presumptive nominee, they'll watch it and they will react, I assume very quickly as well.
CANDY CROWLEY, CNN CHIEF POLITICAL CORRESPONDENT: Sure. And they, one guess is that they will react pretty much as Hill Republicans will because they now seem to be sort of getting the messaging together with Mitt Romney appointing some -- some folks or bringing on some folks that were liaisons to the Hill on both the Senate and the House side.
So I think you will see pretty much the same reaction which is, you know, we have tried these things before, they point to the President's housing proposals and plans that were passed and said they've done little good or not enough good, certainly. And so now he has another housing plan that we're going to pour money into that really doesn't address the problem.
So you can -- you can pretty much, we can play kabuki theater here because we think everybody is going to play their parts. I think the interesting thing here to me will be to watch the President talk about what's happening overseas in the European Union simply because this may be an attempt to kind of brace the public.
Because they were surprised by those job figures last month I don't think they want to be surprised again. And if something goes terribly wrong in Europe or more terribly wrong than it already has and it affects the jobs here, the President wants to be out front and sort of warning folks this may be coming. There are things out of my control and one of them is Europe.
So I think that language will be interesting to watch. Because it sounds at least from Jessica's reporting that I'm listening to that we're going to hear the same proposals that he's -- that have been out there for some time and he has no, absolutely no expectation that Congress is going to take him up on it.
So I think the language about Europe will be very interesting to watch.
BLITZER: I'll be watching together with all of our viewers especially on the eve within the next two weeks of this G-20 economic summit that's going to be taking place in Mexico.
Ali Velshi is watching all of this very closely for us. Ali, you know, the pollsters say the most important questions they ask voters out there: is the country moving in the right direction or the wrong direction on specific issues?
ALI VELSHI, CNN CHIEF BUSINESS CORRESPONDENT: Right.
BLITZER: When it comes to jobs and the economy which of course is the dominant issue in this race, you know, a few months ago there were 200,000 jobs a month being created then 150,000, then 100,000 and then last month what about 69,000 jobs.
VELSHI: Yes.
BLITZER: That's clearly not the right direction. That's the wrong direction and if it continues in that wrong direction that bodes ill for the President's re-election campaign.
VELSHI: And I'll keep an eye on that door and stop talking when he comes out. But I will tell you you're right on what Candy just said about sort of deflecting some attention to Europe. The problem here is the President has -- has very little influence on -- on job creation. And he's got less influence on what goes on in Europe but the reality is this is 20 months of job creation for the President. This was going be the record that he was going to run on. All he need was about 100,000 jobs a month between now and let's say October to be able to say to Republicans every job lost on my watch because of a recession I didn't create has been returned.
Now that actually is in jeopardy because, in part, of what is going on in Europe. So now he's going to have to come out there and say our mission was working; Europe is messing things up for us. China and India to some degree are messing things up for us.
He's got to deflect some of the responsibility because he's been riding high, Wolf, on the idea that job creation the most important thing in this economy has been doing well, 20 months of job creation, 20 months of job creation in the private sector as opposed to the government sector which is actually more important.
So the President now has to find some pivot point to say we have been a job-creating administration, we almost got every last job that was lost under our watch recreated again and he may still do it. But that's what he was running on and this last three months gave him a big surprise -- Wolf.
BLITZER: Here he comes. All right, let's listen in.
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Good morning.
I just want to say a few words about the economy, and then I will take some of your questions.
Today we're fighting back from the deepest economic crisis since the Great Depression. After losing jobs for 25 months in a row, our businesses have now created jobs for 27 months in a row: 4.3 million new jobs in all.
The fact is, job growth in this recovery has been stronger than in the one following the last recession a decade ago. But the hole we have to fill is much deeper, and the global aftershocks are much greater. That's why we've got to keep on pressing with actions that further strengthen the economy.
Right now, one concern is Europe, which faces a threat of renewed recession as countries deal with a financial crisis. Obviously, this matters to us because Europe is our largest economic trading partner. If there's less demand for our products in places like Paris or Madrid, it could mean less businesses -- or less business for manufacturers in places like Pittsburgh or Milwaukee.
Now, the good news is there is a path out of this challenge. These decisions are fundamentally in the hands of Europe's leaders, and, fortunately, they understand the seriousness of the situation and the urgent need to act.
I've been in frequent contact with them over the past several weeks, and we know that there're specific steps they can take right now to prevent the situation there from getting worse.
In the short term, they've got to stabilize their financial system, and part of that is taking clear action as soon as possible to inject capital into weak banks.
Just as important, leaders can lay out a framework and a vision for a stronger euro zone, including deeper collaboration on budgets and banking policy.
OBAMA: Getting there is going to take some time, but showing the political commitment to share the benefits and responsibilities of an integrated Europe will be a strong step.
With respect to Greece, which has important elections next weekend, we've said that it is in everybody's interest for Greece to remain in the euro zone while respecting its commitments to reform.
We recognize the sacrifices that the Greek people have made. Ad European leaders understand the need to provide support if the Greek people choose to remain in the euro zone. But the Greek people also need to recognize that their hardships will likely be worse if they choose to exit from the euro zone.
Over the longer term, even as European countries with large debt burdens carry out necessary fiscal reforms, they've also got to promote economic growth and job creation. As some countries have discovered, it's a lot harder to rein in deficits and debts if your economy isn't growing.
So it's a positive thing that the conversation has moved in that direction and leaders like Angela Merkel and Francois Hollande are working to put in place a growth agenda alongside responsible fiscal plans.
OBAMA: The bottom line is, the solutions to these problems are hard but there are solutions. The decisions required are tough, but Europe has the capacity to make them.
And they have America's support. Their success is good for us, and the sooner that they act, and the more decisive and concrete their actions, the sooner people and markets will regain some confidence and the cheaper the costs of cleanup will be down the road.
In the meantime, given the signs of weakness in the world economy, not just in Europe but also some softening in Asia, it's critical that we take the actions we can to strengthen the American economy right now.
Last September I sent Congress a detailed jobs plan full of the kind of bipartisan ideas that would have put more Americans back to work. It had broad support from the American people, it was fully paid for.
If Congress had passed it in full we'd be on track to have a million more Americans working this year, the unemployment rate would be lower, our economy would be stronger.
Of course, Congress refused to pass this jobs plan in full. They did act on a few parts of the bill, most significantly the payroll tax cut that's putting more money in every working person's paycheck right now, and I appreciate them taking that action.
But they left most of the jobs plan just sitting there. And in light of the headwinds that we're facing right now I urge them to reconsider, because there are steps we can take right now to put more people back to work.
They're not just my ideas, they're not just Democratic ideas. They're ideas that independent, nonpartisan economists believe would make a real difference in our economy.
Keep in mind that the private sector has been hiring at a solid pace over the last 27 months.
OBAMA: But one of the biggest weaknesses has been state and local governments, which have laid off 450,000 Americans. These are teachers and cops and firefighters. Congress should pass a bill putting them back to work right now, giving help to the states so that those layoffs are not occurring.
In addition, since the housing bubble burst, we've got more than a million construction workers out of work. There's nothing fiscally responsible about waiting to fix your roof until it caves in. We've got a lot of deferred maintenance in this country. We could be putting a lot of people back to work rebuilding our roads, our bridges, some of ours schools.
There's work to be done. There are workers to do it. Let's put them back to work right now.
The housing market is stabilizing and beginning to come back in many parts of the country, but there are still millions of responsible homeowners who've done everything right, but still struggle to make ends meet. So, as I talked about just a few weeks ago, let's pass a bill that gives them a chance to save an average of $3,000 a year by refinancing their mortgage and taking advantage of these historically low rates. That's something we can do right now that would make a difference.
Instead of just talking a good game about job creators, Congress should give the small-business owners that actually create most of the new jobs in America a tax break for hiring more workers.
These are ideas that, again, have gotten strong validation from independent, nonpartisan economists. It would make a difference in our economy. And there's no excuse for not passing these ideas. We know they can work. Now, if Congress decides despite all that that they aren't going to do anything about this simply because it's an election year, then they should explain to the American people why.
There's going to be plenty of time to debate our respective plans for the future. That's a debate I'm eager to have. But right now, people in this town should be focused on doing everything we can to keep our recovery going and keeping our country strong and that requires some action on the part of Congress.
So I would urge them to take another look at some of the ideas that have already been put forward. And with that, I'm going to take a couple of questions, and I'm going to start with Karen Bowen (ph), who is with Reuters, but as we all know, is about to go get a fancy job with the National Journal.
(LAUGHTER) And we're very proud of her.
So congratulations to you, Karen. You get the first -- first crack at it.
QUESTION: Thank you very much, Mr. President.
Could you tell the American people what role the United States is playing in the European debt crisis? And also, do you think European leaders have a handle on what's needed to stem the crisis?
QUESTION: And finally, you talked about a number of ideas that you've already put forth to shield the American economy. Do you plan to give a speech or lay out additional ideas now that the crisis is really escalating?
OBAMA: Well, a couple of things.
First of all, the situation in Europe is not simply a debt crisis. You've got some countries like Greece that genuinely have spent more than they're bringing in, and they've got problems.
There are other countries that actually were running a surplus and had fairly responsible fiscal policies, but had weaknesses similar to what happened here with respect to their housing market or their real estate markets, and that has weakened their financial system.
So, there are a bunch of different issues going on in Europe. It's not simply a -- a -- a debt crisis.
What is true is is that the markets getting nervous have started making it much more expensive for them to borrow. And that then gets them on a downward spiral.
We have been in constant contact with Europe over the last -- European leaders over the last two years. And we have consulted with them both at the head-of-government and head-of-state level. I frequently speak to the leaders not only at formal settings like the G-8, but also on the telephone or via video conference. And our economic teams have gone over there to consult.
As I said in my opening remarks, the challenges they face are solvable. Right now, their focus has to be on strengthening their overall banking system, much in the same way that we did back in 2009 and 2010, making a series of decisive actions that give people confidence that the banking system is solid, that capital requirements are being met, that various stresses that may be out there can be absorbed by the system.
OBAMA: And I think that European leaders are in discussions about that, and they're moving in the right direction.
In addition, they're going to have to look at how do they achieve growth at the same time as they're carrying out structural reforms that may take two or three or five years to fully accomplish. So countries like Spain and Italy, for example, have embarked on some smart structural reforms that everybody thinks is necessary, everything from tax collection to labor markets to a whole host of different issues. But they've got to have the time and the space for those steps to succeed.
And if they are just cutting and cutting and cutting and their unemployment rate is going up and up and up and people are pulling back further from spending money because they're feeling a lot of pressure, ironically that can actually make it harder for them to carry out some of these reforms over the long term.
So I think there's discussion now about, in addition to sensible ways to deal with debt and government finances, there's a parallel discussion that's taking place among European leaders to figure out how do we also encourage growth and show some flexibility to allow some of these reforms to really take root.
OBAMA: Now, keep in mind that this, obviously, can have a potential impact on us because Europe's our largest trading partner.
The good news is is that a lot of the work we did back in 2009 and 2010 have put our financial system on a much more solid footing.
Our insistence of increasing capital requirements for banks means that they can absorb some of the shocks that might come from across the Atlantic. You know, folks in the financial sector have been monitoring this carefully and I think are prepared for a range of contingencies.
But even if we weren't directly hit in the sense that our financial system still stayed solid, if Europe goes into a recession that means we're selling fewer goods, fewer services, and that is going to have some impact on the pace of our recovery.
So we want to do everything we can to make that we are supportive of what European leaders are talking about. Ultimately it is a decision that they've got to make in terms of how they move forward towards more integration, how they move forward in terms of accommodating the needs for both reform and growth.
And the most important thing I think we can do is make sure that we continue to have a strong, robust recovery. So the steps that I've outlined are the ones that are needed.
We've got a couple of sectors in our economy that are still weak. Overall, the private sector has been doing a good job creating -- creating jobs. We've seen record profits in the corporate sector.
OBAMA: The big challenge we have in our economy right now is state and local government hiring has been going in the wrong direction. You've seen teacher layoffs, police officers, cops, firefighters are being laid off. And the other sector that is still weak has been the construction industry. Those two areas, we've directly addressed with our jobs plan. The problem is that it requires Congress to take action, and we're going to keep pushing them to see if they can move in that direction.
QUESTION: Thank you, Mr. President.
I'd like to ask you a couple -- about what a couple other people have said about Europe.
And one is that, I'd like to know if you agree with former President Bill Clinton who said in the past week that the Europeans policy that you've described here today are much like those of the Republicans in this country: politics of austerity that would take us in the same direction as Europe. If you agree with that.
The Republicans, for their part, have said that you're simply blaming the Europeans for problems that have been caused by your own policies.
So I'd like you to respond to both of those. And also tell us precisely how much time you personally spend on the European situation.
OBAMA: Any other -- any other aspects to the question?
(LAUGHTER)
QUESTION: I do have more questions.
(LAUGHTER)
OBAMA: The -- first of all, in terms of the amount of time I spend, look, I think it's fair to say that over the last two years I'm in consistent discussions with European leadership and consistent discussions with my economic team. This is one of the things that's changed in the world economy over the last two or three decades is that this is a global economy now, and what happens anywhere in the world's gonna have an impact here in the United States.
OBAMA: Certainly that's true after the kind of trauma that we saw in 2008 and 2009.
And if -- if you think about the situation in Europe, they're going through a lot of things that we went through back in 2009 and 2010 where we took some very decisive action. The challenge they have is they've got 17 governments that have to coordinate; 27 if you count the entire European Union, not just the euro zone. So imagine dealing with 17 congresses instead of just one. That makes things more challenging.
But, you know, what -- what we've tried to do is to be constructive, to not frame this as us scolding them or telling them what to do, but to give them advice, in part based on our experiences here in having stabilized the financial situation effectively.
And, you know, ultimately, though, they're going to have to make a lot of these decisions, and so what we can do is to prod, advise, suggest, but ultimately they're gonna have to make these decisions.
Now, in terms of characterizing the situation over there, what is -- what is absolutely true -- this is true in Europe and it's true here in the United States -- is that we've got short-term problems and long-term problems.
And the short-term problems are how do we put people back to work, how do we make the economy grow as rapidly as possible, how do we ensure that the recovery gains momentum.
OBAMA: Because if we do those things, not only is it good for the people who find work, not only is it good for families who are able to pay the bills, but it actually is one of the most important things we can do to reduce deficits and debt.
It's a lot easier to deal with deficits and debt if you're growing, because you're bringing in more revenue and you're not spending as much because people don't need unemployment insurance as much, they don't need, you know, other programs that are providing support to people in need because things are going pretty good.
That's true here in the United States and that's true in Europe.
So the problem I think President Clinton identified is that if when an economy is still weak and a recovery is still fragile, that you resort to a strategy of "Let's cut more," so that you're seeing government layoffs, reductions in government spending, severe cutbacks in major investments that help the economy grow over the long term -- if you're doing all those things at the same time as consumers are pulling back because they're still trying to pay off credit card debt, and there's generally weak demand in the economy as a whole, then you can get on a downward spiral where everybody's pulling back at the same time. That weakens demand and that further crimps the -- the desire of companies to hire more people.
OBAMA: And that's the pattern that Europe is in danger of getting into. You know, some countries in Europe right now have an unemployment rate of 15, 20 percent. If you are engaging in too much austerity too quickly and that unemployment rate goes up to 20 or 25 percent, then that actually makes it harder to then pay off your debts.
And the markets, by the way, respond in -- you know, when they see this kind of downward spiral happening, they start making a calculation, "Well, if you're not growing at all, if you're contracting, you may end up having more trouble paying us off, so we're going to charge you even more," your interest rates go up, and it makes it that much tougher.
So, you know, I think that what we want both for ourselves, but what we've advised in Europe as well, is a strategy that says, "Let's do everything we can to grow now even as we lock in a long-term plan to stabilize our debt and our deficits and start bringing them down in a -- in a steady, sensible way."
And, by the way, that's what we proposed last year. That's what's proposed in my budget.
What I've said is, let's make long-term spending cuts, let's initiate long-term reforms, reduce our health care spending, let's make sure that we've got a pathway -- a glide path to fiscal responsibility, but, at the same time, let's not under-invest in the things that we need to do right now to grow.
OBAMA: And that recipe of short-term investments in growth and jobs with a long-term path of fiscal responsibility is the right approach to take for, I think, not -- not only the United States but also for Europe.
QUESTION: What about the Republicans saying that you're blaming the Europeans for the failure of your own policies?
OBAMA: The truth of the matter is that, as I said we've created 4.3 million jobs over the last two -- 27 months; over 800,000 just this year alone. The private sector is doing fine.
Where we're seeing weaknesses in our economy have to do with state and local government, oftentimes cuts initiated by, you know, governors or mayors who are not getting the kind of help that they have in the past from the federal government and who don't have the same kind of flexibility as the federal government in -- in dealing with fewer revenues coming in.
And so, you know, if -- if Republicans want to be helpful, if they really want to move forward and put people back to work, what they should be thinking about is how do we help state and local governments and how do we help the construction industry.
Because the recipes that they're promoting are basically the kinds of policies that would add weakness to -- to the economy, would result in further layoffs, would not provide relief in the housing market, and would result, I think most economists estimate, in lower growth and fewer jobs, not more.
OBAMA: All right.
Dave Jackson?
QUESTION: Thank you, sir.
There are a couple of books out with some interesting details about national security issues. There are reports of terrorist kill lists that you supervise and there are reports of cyber-attacks on the Iranian nuclear program that you ordered.
Two things. First of all, what's your reaction to this information getting out in public? And secondly, what's your reaction to lawmakers who accuse your team of leaking these details in order to promote your reelection bid?
OBAMA: Well, first of all, I'm not gonna comment on the details of what are supposed to be classified items.
Second, as commander in chief, the issues that you've mentioned touch on our national security, touch on critical issues of war and peace, and they're classified for a reason: because they're sensitive, and because the people involved may in some cases be in danger if they're carrying out some of these missions.
OBAMA: And when this information or reports, whether true or false, surface on the front page of newspapers, that makes the job of folks on the front line tougher and it makes my job tougher. Which is why since I've been in office my attitude has been zero tolerance for these kinds of leaks and speculation.
Now, we have mechanisms in place where if we can root out folks who have leaked, they will suffer consequences. In some cases, it's criminal -- these are criminal acts when they release information like this. And we will conduct thorough investigations, as we have in the past.
The notion that my White House would purposely release classified national security information is offensive. It's wrong. And, you know, people I think need to have a better sense of how I approach this office and how the people around me here approach this office.
We're dealing with issues that can touch on the safety and security of the American people, our families or our military personnel or our allies, and so we don't play with that.
OBAMA: And it is a source of consistent frustration, not just for my administration, but for previous administrations when this stuff happens. And we will continue to let everybody know in government -- or after they leave government -- that they have certain obligations that they should carry out.
But as I think has been indicated from these articles, whether or not the information they've received is true, the writers of these articles have all stated unequivocally that they didn't come from this White House, and that's not how we operate.
QUESTION: There are leak investigations going on now, is that what you're saying...
(CROSSTALK)
OBAMA: What I'm saying is, is that we consistently, whenever there is classified information that is put out into the public we try to find out where that came from. All right?
OK. Thank you very much, everybody.
QUESTION: (inaudible)
OBAMA: Thank you.
