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Parker Spitzer
New Details About Depth of Financial Crisis; Bringing Civility Back to Politics; Interview With Richard Haass
Aired December 01, 2010 - 20:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
KATHLEEN PARKER, CO-HOST: Good evening. I'm Kathleen Parker.
ELIOT SPITZER, CO-HOST: I'm Eliot Spitzer.
Glad to have you back, Kathleen. We missed you.
PARKER: Thank you. I'm glad to be back. I missed you all.
SPITZER: Indeed. Indeed. I know you did.
Another great show tonight.
Coming up: frightening new details about the depth of the financial crisis. The Federal Reserve revealed it loaned trillions to keep corporate America afloat. In a moment, we'll talk with the man who helped forced this disclosure, Senator Bernie Sanders.
PARKER: Plus, Charles Barkley critiques President Obama's basketball skills and it's not a ringing endorsement, Eliot. We'll hear what the round mound of rebound had to say.
SPITZER: Well, as always, tonight's opening argument. You know what, Kathleen? We are being held hostage, everyone of us. We are hostages, being held hostage by 42 Republican senators the day after the Republican leadership meets with the president and says we want bipartisanship.
They send a letter saying, no way, no how. We will do nothing until you give a tax cut to the rich. No START Treaty -- something that has been endorsed by Henry Kissinger, Jim Baker, every major Republican foreign policy leader who says pass the START Treaty. Colin Powell said it today. They say, no way.
No unemployment benefits for those who are looking for jobs -- can't get it with unemployment at 9 percent, 10 percent. This is outrageous. This is not the way to govern.
The party of no has gotten worse. I think it is a shame. And it is just beyond -- beyond comprehension.
PARKER: Gosh, you're just so cute when you're angry, Eliot. I know it's not funny. But I don't know why I'm smiling -- because I got stuck on the image of being held hostage by 42 Republicans. Talk about a bad date. (LAUGHTER)
SPITZER: I certainly agree with you on that one.
PARKER: To get to your point, I assumed when I heard that there was opposition to the START Treaty, that there must be some legitimate concerns. And I did a little reporting and asked around. I'm convinced by the people I've spoken with who are knowledgeable in foreign affairs and certainly with this particular treaty that it is important to go ahead and do it.
SPITZER: Yes.
PARKER: On the tax issue alone, let's just say --, you know, let me be wild and crazy here and propose a compromise that seems to me -- you know, the Republicans are using this as leverage obviously. And they're doing it rather successfully.
But you know what? Why not say, we're going to do what's best for the country and let's find a compromise position? One of which that I find rather appealing is: raise the definition of rich. You and I both know that a two-income family earning $250,000 a year, that's not rich-rich certainly in urban areas. So, raise the ceiling, raise it to $1 million, or postpone it for, you know, to some period, bring it up to $500,000.
SPITZER: As we speak, there are millions of Americans whose unemployment benefits have run out.
PARKER: Yes.
SPITZER: Congress, think any person with the sense of justice would say we need to help these folks. They're looking for jobs. There simply aren't jobs aren't there.
We have unemployment that simply is twice as high as it ordinarily is. Families that can't afford to put food on their table. And the Republican leadership is saying, until we give a tax cut to the rich, we won't even consider extending unemployment benefits for those folks. It just isn't the sense of justice that should permeate our politics.
And I'm just almost -- I'm almost outraged at the callousness with which these issues are being played with at a moment of such desperation.
PARKER: Well, I don't think that the American people are going to be -- are feeling very positive right now about the way the Congress is behaving. And this is -- you know, as you say, our problems are really, really, really serious.
And we've got to do something. Move it forward. Digging in the hills right now is not --
SPITZER: Yes, not the way to govern.
PARKER: All right.
SPITZER: All right. For more on the impending clash in Washington, let's go into "The Arena."
PARKER: Joining us in "The Arena" to talk about what this means is one of the Republicans' rising stars, Congressman Greg Walden.
Thanks for joining us, Congressman.
REP. GREG WALDEN (R), OREGON: Glad to be with you today.
SPITZER: Congressman, thank you for joining us.
But I just got to ask you a question. It seems as though the Republicans in Senate are holding us hostage. Every major piece of every issue that needs to be addressed for this nation is being held hostage to the one issue of tax cuts for the rich. Is that any way to govern right now?
WALDEN: Eliot, you're always good with the questions. Let me just say this, first of all, I'm in the House, not the Senate. Second of all, Americans spoke and the referendum in the country was on the House.
And the problem is that the White House and the Senate and the U.S. House under the same leadership as before the election hasn't gotten the message of the American people and that is it's about jobs and cutting spending, not growing the government. That's really the issue.
SPITZER: And, Congressman, with all due respect, certainly, when it comes to the economy, we'll talk about that in a moment, all the multiple facets of that issue.
Take the START Treaty, former Secretary of State Colin Powell just left a meeting with the president saying passing the START Treaty, ratifying the treaty, hugely important. Henry Kissinger, James Baker. Republican secretaries of state have said the same thing.
How can it be that the Republican Party opposes this critical national security measure?
WALDEN: Well, Eliot, again, I think you have to look at what other agreements are on the sidebar there. I know Senator Kyl has been deeply involved in this issue and has raised some concerns privately and I think publicly about what else has maybe been negotiated on the side that we're not fully aware of.
PARKER: Well, look, I know you're in the House and I know that the letter to Senator Reid was corresponding to the senators. But even so, John Boehner, you know, has wanted to bring in this whole new spirit of cooperation. I just wonder, do you feel that letter kind of undermines that spirit?
WALDEN: You know, what we're focused on is in the House. And what we're trying to do in the House is set up to run this House in the more open and transparent way than it's ever been run before.
PARKER: One of the things I want to ask, though, is: why is it not reasonable on the tax cut issue just to raise the threshold of the rich, say, to $1 million? Nobody feels sorry for people earning $1 million. Wouldn't that be a compromise solution that everybody could agree with?
WALDEN: I think what we said was pretty clear. Extend this because the worst thing you can do in a recession is pass job-killing tax increases. Remember, taxes go up absent an act of Congress. And they could go up on everybody.
I was a small business owner for 22 years. I talked to a lot of small business owners. And I'll tell you what, there's a lot of money on the sidelines. People can't plan right now. There's a lot of uncertainty which leads to unemployment.
SPITZER: You know, I hear what you're saying about a lame duck Congress. You don't want lame duck congressman to be voting on important things. On the other hand, unemployment benefits have run out for millions of Americans who are seeking jobs, with unemployment, really, in the mid-teens, not the 9.6 that's reported. These are millions of Americans desperately looking for jobs.
Do you support extending benefits to those millions of families so they can buy food for their kids?
WALDEN: Eliot, absolutely. Now, look, though, here's the deal -- why is it that the Democrats who controlled Congress under Nancy Pelosi and Harry Reid refuse to allow us to offer up an alternative that would actually pay for that extension of unemployment benefits? This is twice they've done that.
We have options. We have alternatives. Why do you think it's OK for them to just shut out any alternative which would pay for that which is how it's come to the floor?
SPITZER: Congressman, look -- we have a point of agreement here. I just want to do everything I can to make your people focus on this. So, you would vote for a clean bill that says extend those unemployment benefits?
WALDEN: Now, Eliot, that's not what I said. I know you were a prosecutor. That's not what I said. What I said is --
SPITZER: I think that's what most people heard you saying.
WALDEN: OK. What I said, yes, I could vote to extend unemployment benefits if they're paid for.
SPITZER: Here's what I'd like to do, since I'm thrilled you raise the issue of how we pay for thing because one of the issues I've been trying to grapple with and I've been asking a lot of our guests here: how are we going to balance the budget?
I know you and your party in particular ran on the platform of balancing our budget, getting rid of the deficit. The tax cults that you want to make permanent add a $4 trillion hole over the next decade -- which, OK, I understand you're for it. But then I'm obligated to follow up by saying how are we going to pay for it?
So, let's ask the easy one: where do you stand on the Bowles/Simpson bipartisan deficit closing proposal that's been announced both yesterday and over the past week? Their concepts for closing that deficit? Are you for it or against it?
WALDEN: You know, first of all, Eliot, I'm not for or against something I haven't had a chance to read and fully understand, and I haven't had that chance. Second, they put forward some really bold initiatives that frankly both side, or at least from what I've heard originally, Speaker Pelosi and others condemned right off the bat.
But what they've done is really important. And that is this: they have begun to educate the American people the depth of the deficit and debt problem we face in this nation and the severity of the changes that are going to have to occur. So, why is it it's always an either/or? Why don't we create a system here in Washington where both sides sit down, we bring everybody's brains to the table and say, how do we begin to put this country back on a path to where we pay our bills like families have to do?
And when we take over in November, with 87 new Republicans, and a class of 63 pickup over Democrats, we'll have that opportunity to show how we will govern. Right now, we continue to be shut out of every discussion that takes place, and they continue to run it like they did that got them in trouble.
SPITZER: Wait a minute. I mean, I've got to disagree to you a little bit on that because the commission that we're talking about was chaired by Erskine Bowles, who was the chief of staff in a Democratic presidency, and Senator Alan Simpson, one of the most conservative Democrats out, conservative Republicans out there.
WALDEN: Right.
SPITZER: And just today, Judd Gregg, a very conservative Republican senator, said he was for it. So, this really is a bipartisan commission that has taken all the ideas you're talking about. And we've had several weeks now, the ideas have been out there.
So, which pieces of it do you not support? They talk about, you know, raising the Social Security age in terms of benefits. Are you for that or against that?
WALDEN: Eliot, look, I think you have to take it all in context here. And say, what is it that will move us forward? There are other proposals out there as well --
SPITZER: But with all due respect, you just ran a national campaign that you're going to balance the debt and the budget, get rid of the deficit. I'm asking you for some singular ideas about how to do it, because you just add $4 trillion to the deficit with a tax cuts.
So, I'm asking you for some ideas --
WALDEN: Eliot, look, look --
SPITZER: Just give us a couple. Give us a couple.
WALDEN: Look, you can go through -- I'll tell you what we're going to do. We're first going to pass a budget, which the Democrats did not do in the last year. That's where you begin to lay out the priorities.
Second, we're going to break open the appropriations process so that members of Congress can actually go to the floor like they use to do and offer up those alternatives. This is about how we govern going forward. And you're going to see that happen under John Boehner as speaker and what we did not see happen under Nancy Pelosi as speaker. And that's where we'll have those specific ideas going forward.
SPITZER: Can we do this? Given that we've got a deficit over the next decade, only the next decade is about $11 trillion -- can you give me just ideas that would give me, you know, $2 trillion in savings? Just a little old two?
WALDEN: Just pick a number here, Eliot, look. Here, look, why don't we just go in? And as the president has now agreed with us, let's start by freezing federal pay. That's one thing. That saves you $30 billion over the period -- whatever the number is --
SPITZER: Yes. But, Congressman, we're talking trillions. We're talking trillions.
WALDEN: Eliot -- Eliot, I know that. First of all, let's repeal -- take over national health care. How is that one? That's going to save you --
SPITZER: No, no, no, no. Congressman, Alan Simpson, your Republican conservative senator, agrees repealing it is going to cost us money. They want to strengthen many of cost-saving provisions in there. That's Alan Simpson, Judd Gregg --
WALDEN: Alan and they don't -- well, Judd Gregg nor Alan Simpson is going to be in the Congress next session, OK? And Alan Simpson is not there now.
SPITZER: Maybe that's why they want to tell the truth.
WALDEN: You know, that's clever.
SPITZER: Thank you.
WALDEN: Here's the deal -- yes, yes. So here's the deal -- you were a governor. You know the kind of unfunded mandates that went into New York. You know the costs that go in there from the federal government. At some point, we're going to have to have a conversation with the governors about how to reform some of the big programs. You've touched on them. You know the big ones. The entitlement programs, they cannot be ignored.
SPITZER: Let's take Medicare, which is far and away the biggest driver of the deficit. Can you give us any cuts that you're willing to make in Medicare so we begin to make some progress in this $11 trillion, $12 trillion chasm?
WALDEN: Eliot, there are things you can do with Medicare. There are things you can do with Medicaid. You can do those both in partnership with the states.
On the energy and commerce committee, when I was in the majority, we actually did a package that empowered the states to be able to save some money of significant amount -- it was in the billions of dollars -- by giving them some flexibility on how they operate.
PARKER: Congressman, before we let you go, I just wanted to say one nice thing to you. I understand that one of the goals of the new House under John Boehner is to have a more transparent operation and you've asked for recommendations from citizens who can go online and give --
WALDEN: Yes.
PARKER: -- their ideas. One of which is -- hope you'll stop your bipartisan bickering. And I also understand you've reached across the aisle to the Democrats. And so, we appreciate that.
WALDEN: Yes, we have and I think they appreciate that. There's a lot of rank-and-file members around here that want this institution to work again. It's been broken for both parties leadership for too long.
I really tell you, we're going to change how this place operates. I hope that will lead -- process matters -- I hope that process change will lead to better policy so we can come together as we've talked with this commission -- you know, there are things we can do legislative. That's what the people paid us to do by the way.
It is their House. It is their money. They should be a part of this. We're going to open it up, make it more transparent. We'll have a lot more of these discussions and debates.
SPITZER: All right. Congressman, thank you so much.
WALDEN: You're welcome.
PARKER: Thank you, Congressman.
Still ahead on the program: scary new figures from the Fed that crisis of 2008 much worse than we knew. Don't go away.
(BEGIN VIDEO CLIP) SEN. BERNIE SANDERS (I), VERMONT: I think, Eliot, what we have begun to do is lift the veil of secrecy at one of the most important American agencies, and that is the Federal Reserve, of which the American people know very little.
(END VIDEO CLIP)
SPITZER: News today that the financial crisis was much worse than we knew. Not just banks were teetering on the edge, but many of America's major corporations, including McDonald's, Caterpillar, General Electric and more. In total, the Fed issued $9 trillion -- that's with a "T" -- $9 trillion in short-term loans to American banks and corporations.
Our next guest led the fight to force the Federal Reserve to reveal exactly how much money it handed out and to whom.
Joining us in the exchange tonight, Senator Bernie Sanders of Vermont. It was his plan that required the Fed to go public on all its emergency lending.
Senator Sanders, thank you for joining us. Congratulations. You are in many respects a true American hero tonight. You have revealed $9 trillion in taxpayer spending.
How does that feel?
SANDERS: Well, I think, Eliot, what we have begun to do is lift the veil of secrecy at one of most important American agencies, and that is the Federal Reserve, of which the American people know very little. And I think what you are seeing is the incredible power of a small number of people who sit on the Fed who, in my view, have incredible conflicts of interest getting incredible help from the taxpayers of this country, while at the same time ignoring the needs of the people who bail them out.
SPITZER: Senator, let me go back for a second because I just want the public to understand, you asked Chairman Bernanke, chairman of the Federal Reserve Bank, at a hearing about a year ago, perhaps more, if he would reveal the magnitude of the loans and who the recipients were, and he refused.
SANDERS: That is exactly right, Eliot. It was a budget committee hearing. And I said, Mr. Bernanke, tell us the names of the financial institutions who received trillions of dollars at very low interest rates from the American people. He said, I'm not going to do that. And what we did is we introduced legislation to make him do that. And that's what today is about.
SPITZER: But just also so it's clear, that legislation, that amendment, was opposed by the Fed --
SANDERS: Oh, vigorously opposed. Yes.
SPITZER: -- and also by the White House.
SANDERS: We went back and forth with the White House, but certainly yes.
SPITZER: Certainly, they did not want this disclosure. And yet, what have you -- you have now opened up is perhaps the biggest single transfer of taxpayer money to corporate America in history.
SANDERS: I think that that's correct.
SPITZER: Now, the other -- you talk about the New York Fed or the Federal Reserve Bank. And, parenthetically, I wrote an article of that two years ago, the headline or the title of was, "The Most Important Least Understood Institution in America," it's about the Fed.
Do you believe these loans should have been made? I mean, we were in the state of crisis. The liquidity of these companies was in jeopardy. Should the companies have received this assistance?
SANDERS: Well, Eliot, the more important point was, is if I lend you something at half a percent interest rate, what are the conditions attached to that loan? What are you going to do for me?
For example, if you are one of the major financial institutions and we have the top four in this country that issue half the mortgages in America, what are you going to do to make sure that people don't lose their homes? Are you going to lower -- are you going to negotiate with them and lower their interest rates if they're about to be foreclosed?
SPITZER: Senator, I interrupt only because I completely agree, but I want to ask something that comes before this, which is -- I think at least from my perspective, it was almost necessary these companies be given assistant or else the entire economy would have ground to a halt. So, I think that is an equally important point to make. We could not take our economy over the precipice into a depression.
SANDERS: Well, I think -- I mean, that's a good point, Eliot.
But the other half of it is, the average American is sitting home, his or her standard of living is declining, can't afford to sent their kids to college, may have lost their home. I think what this revelation, this disclosure is about, is a group of enormously powerful people who today, in many instances, are making even more money than they did before they were bailed out by the taxpayers. And the American people are saying, hey, what does the government do for me? Do you they allow me to keep my house, my job, my savings?
What kind of power do these guys have who sit in closed rooms, making decisions for trillions of dollars to protect their interests?
SPITZER: Senator, could I not agree more. I begin with the notion the loans in fact had to be made or else the economy would have shut down, but the grievous error -- and I almost use the word crime but I don't want to suggest criminality in the traditional sense, but the enormous error of the judgment at a minimum was not saying to these banks and other companies, and we can go to some of them in a second, now that you get this assistance, you must participate in the reform that is necessary and you must participate in helping the rest of America. That's --
SANDERS: Exactly.
SPITZER: That was -- there was no conversation like that was had.
SANDERS: Exactly. So, what you have right now are the large financial institutions who are now doing very, very well, sitting on top of huge amounts of cash, and yet small businesses in Vermont and all over this country can't get affordable loans in order to create jobs. You got credit card companies that were substantially helped by the bailout say -- oh, thank you very much for bailing us out, now we're going to charge you 25 percent or 30 percent interest rates.
SPITZER: And, Senator, am I correct that the moment the banks had received these short-term loans and then paid them back by and large, they then came down to Washington and worked against the very reforms that you've been pushing for?
SANDERS: Eliot, to the tune of hundreds of millions of dollars in lobbying efforts -- an absolute outrage. They tried to destroy any capability to bring real reform to Wall Street.
SPITZER: And just to give the public a sense, Citigroup got $1.8 trillion in these loans. I mean, there we have it up on the screen. Merrill Lynch, $1.5 trillion, Goldman Sachs that said it didn't need anything because it never had a problem, so they said, $590 billion -- staggering, staggering sums.
Was this done out of the New York Fed, by and large?
SANDERS: I believe that's the case.
SPITZER: And that was being run by Tim Geithner at the time?
SANDERS: I believe that is the case.
SPITZER: Now, I don't mean to seem like I'm leading a witness here, but wouldn't we have wanted to know when he was being -- you know, when the vote was being held whether he should be treasury secretary, what he had done and what the conversations were with these banks that the time?
SANDERS: Well, Eliot, you're talking to somebody who voted against Mr. Geithner for secretary of treasury and voted to help lead the opposition against Ben Bernanke, to once again become chairman of the Fed. Those are the right questions to ask.
SPITZER: Senator, thank you so much for your time. This is going to be a continuing story. I hope we will have a chance to continue this conversation. And as I said at the top, congratulations. Your fortitude in pushing for this disclosure has done a huge, huge, huge public service.
SANDERS: Eliot, thank you very much.
SPITZER: Coming up, we'll have a full assessment of the damage from the WikiLeaks dump and a close at the crisis boiling in what was once called the "Axis of Evil."
(BEGIN VIDEO CLIP)
MARK MCKINNON, REPUBLICAN STRATEGIST: I don't think this is party specific. I think it's just a problematic on both sides of the aisles where the parties are rewarded for hyper-partisanship. That's the real problem. So, we're trying to figure out a vehicle on all labels where we can -- whether it will be a voice out there calling fouls when they happened.
(END VIDEO CLIP)
(COMMERCIAL BREAK)
SPITZER: It's getting worse, not better. I'm talking about partisanship in politics. It used to be there was some issues that partisan didn't touch like foreign policy, like the START Treaty or even the Fed and how it ran the economy. No more.
Today, even those issues driven by partisanship.
PARKER: And joining us on "Constitution Avenue" is Mark McKinnon, a Republican political strategist. He worked in the Bush White House, as well as for some Democrats such as Ann Richards of Texas. He has a radical idea about how to fix our political logjam, civility and compromise.
Welcome, Mark.
MCKINNON: Hi, thanks. Good to see you, Kathleen. Governor, how are you?
SPITZER: Pleasure. Glad you're here with us today.
PARKER: It's great to see you, Mark.
Of course, you know that this is a subject about which I'm passionate as well. I like to think of myself as a radical centrist. But we got to play devil's advocate a little bit here so that you can make a case for no labels.
MCKINNON: Sure.
PARKER: Yesterday, every Senate Republican signed a letter announcing their intention to block any legislative action that wasn't related to tax cuts or government spend during their lame duck session. So, in other words, Republicans are, you know, throwing down the gauntlet. No votes on "don't ask, don't tell," nothing on unemployment insurance extensions or any other Democratic issues.
So, what is the rational centrist response? MCKINNON: The rational centrist response is that's exactly why we need a movement to represent the millions of Americans who look at this kind of behavior and say, who's representing our voice? This hyper-partisanship reflects just a tiny percentage of people who are in Washington. But it doesn't represent America.
And as I go around the country, and we're going around doing these no labels meetings, people are crying out for progress, for -- they just want people in Washington to be civil, to meet together, to -- they don't have to give up their principles, but they need to recognize people want us to move forward, to make progress.
And the way the system's set up now is that hyper-partisanship is rewarded. And people who try and work across the aisle with one another are the punished by these hyper-partisan interests in the parties and in some of the media, and that's the problem.
And so, I was glad to see the president meeting with Republicans yesterday. That's a good start. But we need a lot more of it.
PARKER: Yes, Mark -- I mean, the thing is, again, playing devil's advocate, the Republicans have been very effective with their "hell no" posture on things. And, you know, I'm wondering if cracking heads isn't the better way to go? You know --
MCKINNON: Yes, you're right. I mean, the Republicans are sort of responding to this last election and they're sort of drawing a line in the sand and saying, hell no, we won't go. But I think that that's a -- I think that's a short-term prescription and short-term strategy that is not serving the greater interest of the country.
SPITZER: Mark, I completely agree with your premise. We need civility. We need centrism. We need pragmatism. We need thoughtfulness.
I'm going to make a startling suggestion -- we have that in the White House in the form of Barack Obama. He has gone to the Senate and said, let's deal issue by issue. START, nobody disputes, no rationale person in my mind that the Senate should pass the START Treaty. You would agree with that, I presume?
MCKINNON: I do. In fact -- and I support the president's ambitions here. As I supported President Bush's similar ambitions.
SPITZER: Absolutely. "Don't ask, don't tell," I think most people would agree bring it to a vote now that the Joint Chiefs and the Defense Department have spoken. Don't you think that's something the Senate should be -- should consider at this point in time?
MCKINNON: Sure, I do. I mean, I think that most Republicans had said at one point they want the military to make their point of view clear and they've done that.
SPITZER: I think -- you know, we can go back in history a little bit, go back to the health care bill, which was modeled after Mitt Romney's bill in Massachusetts in terms of some of its -- most of its fundamental pieces, compromised hundreds of times with the Republicans. There again, a product of compromise, alienated the progressive wing of the Democratic Party. You agree that was sort of a centrist bill.
MCKINNON: Well, it was to some extent. I would much prefer to see more market solutions. And I think that people reacted to the process and the politics that got involved in that. And that was part of the problem there.
SPITZER: But even the stimulus, which was, at least half of which was tax cuts and Republican ideas. And so I would suggest to you, I agree wholeheartedly with your notion that we need pragmatism, centrism, rationality. That what Barack Obama has done, but the Republican Party has been moving the goal post of what centrism means. They've gotten so increasingly fringelike, that they're now standing off there on the sidelines saying we are the center, when, of course, they're not. I think that's what wrong. The whole spectrum has shifted. And the president is a very centrist voice.
MCKINNON: Oh, I agree. And listen, I think that the president's doing the right thing. I think he's making moves towards the middle, which is exactly what he ought to do for the country. And I think it's also good for his long-term politics despite the pressure that he's getting from the hyper-partisans on the left. So I think it's a long term strategy. He's doing the right thing.
SPITZER: But, Mark, I want to come back to a couple other issues because I think if people understand where you and your organization fall out in these issues and will help them sort of appreciate what you're trying to do. Global warming is another issue where, you know, the Republican Party right now has been vehemently opposed to most of the incoming Republicans who have been elected reject to the science, don't want to do anything in terms of global warming. Do you have a position on that? Does your organization weigh in on that issue?
MCKINNON: We don't specifically because we didn't want to do that before we launched, Governor. What we want to do -- we didn't want to dictate from the few of us who started this thing to say here are our views. I've got my views pretty clearly laid out in what I call my centrist manifesto that I wrote a few weeks ago at "The Daily Beast." But that's just my opinion and I don't want to impose my ideas on this organization that's really bubbling up from the grassroots. So what we're doing is we're launching on December 13th and we're going to let the community decide where they want to go on these issues.
KATHLEEN PARKER, HOST: Well, Mark, it's hard to make centrism and pragmatism sexy but, you know, we wish you luck. It's an interesting idea. And thanks for joining us.
MCKINNON: Thanks. We're going to kick it hard. Appreciate your getting out there on it, Kathleen.
PARKER: All right, Mark, take care.
SPITZER: Coming up, when it comes to the WikiLeaks, document dump fallout is not just a figure of speech. We'll talk about a nuclear Iran, a nuclear North Korea and our old nuclear friend Russia with the foreign policy maven Richard Haass. We'll be right back.
(BEGIN VIDEO CLIP)
RICHARD HAASS, PRESIDENT, COUNCIL ON FOREIGN RELATIONS: I, for one, am fairly pessimistic that our politics at this moment in this country are at a point where we are, our elected representatives, are going to be able to deal seriously with this challenge.
PARKER: Well, I hope everybody will read this article that you wrote because it explains everything, but in fairly apocalyptic terms. It's fairly frightening the way you describe --
HAASS: Well, we should be frightened.
PARKER: -- where we will be in just 10 years.
(END VIDEO CLIP)
(COMMERCIAL BREAK)
SPITZER: Russia is no longer a democracy. That is one of many bombshells in the WikiLeaks document dump. And, indeed, that is not just anybody saying that. That was the U.S. Secretary of Defense Robert Gates saying it to a French defense official. As you can imagine, Prime Minister Putin of Russia did not appreciate that comment.
Joining us to discuss this tonight, Richard Haass, president of the council on Foreign Relations and expert on foreign affairs. Thanks for being here.
RICHARD HAASS, PRESIDENT, COUNCIL ON FOREIGN RELATIONS: Good to be back.
SPITZER: You know, let us see exactly what Secretary of Defense Gates said. It is kind of startling. Russia pretending to be a democracy for a number of years. Let's put up on the screen what they said. "Russian democracy has disappeared and the government was an oligarchy run by the security services." It sounds ominous and kind of dangerous. Before you jump in, let's listen to what Prime Minister Putin said and you can hear the whole interview tonight on "LARRY KING LIVE." This is kind of remarkable.
(BEGIN VIDEO CLIP)
VLADIMIR PUTIN, RUSSIAN PRIME MINISTER (through translator): He's been deeply misled. Our country is led by the people of the Russian federation through the legitimately elected government and the parliament authorities of the president and the prime minister of the Russian federation.
(END VIDEO CLIP)
SPITZER: All right, Richard, who's right, Secretary of Defense Gates, Prime Minister Putin? What does this all mean?
HAASS: That's a pretty good line. An oligarchy run by the security services. Just because you have elections doesn't make you a democracy. The fact that Mr. Putin was president, is prime minister, will probably go back to being president in a couple of years, tells you that he has consolidated power still. Television in particular is highly limited. Wealth has been distributed in the form of crony capitalism. It's a hybrid. It's a combination, if you will. Can I say one thing though?
SPITZER: Of course.
HAASS: U.S./Russian relations are arguably the most improved bilateral relationship this administration has engineered over the last two years.
SPITZER: Would this affect it?
HAASS: Seriously, no. And people tend to exaggerate how much personalities count in foreign policy. It will create a few moments, shall we say of (INAUDIBLE). Are you allowed to use French words on the show?
It will create some awkwardness. But at the end of the day, U.S./Russia relations towards Iran, also in the WikiLeaks are somewhat better in part because this administration adjusted its plans for missile defense in Central Europe in order to accommodate Russian views.
PARKER: Well, back to Putin's interview with Larry King, he also, they were talking about the START treaty negotiations. And President Putin said -- well, Putin said, if the treaty isn't ratified, that Russia will go ahead and build its nuclear missile technology but it's not a threat. Does that sound like a threat to you?
HAASS: Well, nuclear weapons are one of the few things the Russians really have as tied to their great power status. And these armed control talks are a way of echoing that. I think they'll be pretty upset if the Senate doesn't go ahead and ratify the treaty. We should be pretty upset if the Senate doesn't go ahead and ratify this treaty because on balance it's in our interest on nuclear grounds, on U.S./Russian grounds and also on the grounds that we as a major power ought to be reliable.
SPITZER: You wrote an article recently in foreign affairs that looks at what is perhaps the lingering day-by-day crisis of debt and profligacy as you said in your title that is destroying our capacity to run the sort of foreign policy we want. Does the debt commission, the Bowles/Simpson commission, address your concerns in a satisfactory way?
HAASS: The short answer is no despite my respect for what they've done and for both of them. I think they did themselves a disservice. They haven't yet sold America on the need to do something about the deficit and the debt. If I had been in their shoes, I would have spent several months simply explaining the scale of the problem and why it matters. I would not have rushed to talk about this tax cut or tax increase or this spending cut or what have you. But they've done that.
I think what they've done though that's good is they've put this issue on the table. I'd be real surprised that they got support from their own commission. But this issue is now in play, but I don't know how both of you feel. I, for one, am fairly pessimistic that our politics at this moment in this country are at a point where we are, our elected representatives, are going to be able to deal seriously with this challenge.
PARKER: Well, I hope everybody will read this article that you wrote because it explains everything, but in fairly apocalyptic terms. It's fairly frightening the way you said --
HAASS: Well, we should be frightened.
PARKER: Where we will be in just 10 years and how dreadfully that affects not just our lifestyle here but our foreign policy.
HAASS: This is the biggest economic challenge facing this country. Our debt is also the biggest national security challenge, far big than Afghanistan, far bigger than North Korea. Our ability to be a model, our ability to act in the world, to have the resources we need. Our ability to sustain our economic growth which is so essential, all of this is now at risk. I don't mean to be apocalyptic, but we face serious challenges.
PARKER: Our ability to be a model to the world.
HAASS: Absolutely.
PARKER: As you point out.
HAASS: Absolutely.
PARKER: The model of capitalism and free markets is suffering as a result of our profligacy.
HAASS: It took a major hit after 2008 after our own failure to run our own economy well. So one of the reasons that countries like China are getting the attraction they are is because we are not doing a good enough job of showing that we've got a better way, which is ridiculous because we do have a better way.
PARKER: Let's go to South Korea.
HAASS: Sure.
PARKER: The South Korean spy chief today said that the North is highly likely to attract the South again. And you say if the North keeps it up, the U.S. should retaliate against --
HAASS: Certainly in the first instance, the South Koreans should. I don't think the right way to approach this is that every time the North Koreans outrageously use military force they should get a pass. The only lesson they learn from that is they can continue to do it. And they'll keep escalating. So I think yes, South Korea should be careful but push back.
But there's really interesting things about Korea on this. One is how the United States and South Korea are beginning to talk about the possibilities of a united Korean peninsula under Seoul and talk about it in ways that will hopefully assuage some Chinese concerns. The hope being that China will stop blocking this possibility. That to me is pretty creative diplomacy. The other thing though that China has found out in these cables which is really unattractive is the Chinese have done nothing, or very little rather, to thwart the flow, say, of missile technology from places like North Korea to Iran. So there, it's a place where China has really disappointed.
PARKER: All right. Richard Haass, always great to talk to you.
SPITZER: Still ahead, nothing says happy holidays like no more unemployment checks. You can't make this stuff up. "Our Political Party" weighs in. Don't go away. We'll be right back.
(BEGIN VIDEO CLIP)
SPITZER: The Republicans in the Senate have taken the entire agenda of progress in this nation hostage. Is this good for America? What's going on in Washington?
ANNABELLE GURWITCH, CO-AUTHOR, "YOU SAY TOMATO, I SAY SHUT UP": Reminds me of a marital issue. It's like when I tell my husband I'm not having sex with you unless you do the dishes. Now no one's getting laid and the dishes aren't done.
(END VIDEO CLIP)
(COMMERCIAL BREAK)
PARKER: Welcome to "Our Political Party," where we invite the fun crowd to mouth off. Let's meet tonight's guests. We have Annabelle Gurwitch who co-wrote "You Say Tomato, I Say Shut Up: A Love Story" with her husband. I love that title. Did I say that right? Or is it "I Say Tomato."
ANNABELLE GURWITCH, CO-AUTHOR, "YOU SAY TOMATO, I SAY SHUT UP": No, "You Say Tomato, I Say Shut Up." But we both say shut up and tomato, so it's a little confusing.
SPITZER: It's a love story.
GURWITCH: It is a love story. We're still married today.
SPITZER: Oh, going to be watching this.
PARKER: All right. We also have Dylan Glenn, who advised both President Bushes and the governor of Georgia, and was on the National Economic Council. Welcome.
DYLAN GLENN, FMR. ADVISOR TO BOTH PRES. BUSHES: Thank you.
SPITZER: And we have Max Kellerman who is a boxing analyst for HBO and a CNN contributor.
MAX KELLERMAN, HBO BOXING ANALYST: Yes, sir.
SPITZER: Thank you for being here. This could be a boxing match by the time we're done.
Anyway -- anyway, the Republicans in the Senate have taken the entire agenda of progress in this nation hostage. Is this good for America? What's going on in Washington?
GURWITCH: You know, this reminds me of a marital issue. It's like when I tell my husband, I'm not having sex with you unless you do the dishes. Now no one's getting laid and the dishes aren't done. This isn't a --
SPITZER: You overplayed your hand is what you're saying.
GURWITCH: I did. I feel like they wrote this out on a piece of paper, crumpled it into a ball.
GLENN: Which one's the Congress and which one's the president? I mean, husband or wife -- I'm not sure.
SPITZER: I would go away from this metaphor.
GURWITCH: Now that is a question, right? No, but, I mean, it's so immature. Nothing gets done this way. The only thing I think we can hope for is they take it even further and filibuster. Because when they start moving the cots in and they do that whole, like the sleepover thing, if they make s'mores, anything can be solved.
PARKER: Like foreplay.
GURWITCH: Yes. And I say go all the way, baby, filibuster, you know? Maybe something will get done then.
PARKER: All right.
PARKER: Dylan, top that, good luck.
GLENN: I don't want to go after that. But, you know, I'm not so worried about it. I think that the American people spoke on November 2nd and they sent a pretty resounding message to the country that they weren't afraid of gridlock. And so I'm not suggesting we're going to have gridlock but I think having a very real discussion about what the priorities in Washington should be, I think the Republicans think the priorities should be jobs and tax cuts and things that will affect the economy and the growth of the economy. I think that's a good position to have a conversation about.
PARKER: Do you really think that the American people are not afraid of gridlock? You think they're in favor of that? I think they really want change. I think they really want Congress to work together and figure these things out.
GLENN: I think that they voted for -- clearly voted for divided government. That doesn't suggest gridlock. It just means that they want to have another voice at the table. And I think it's --
KELLERMAN: Klein (ph) had a really interesting article a day or two ago in "The Washington Post" about incentives and how Mitch McConnell or whomever is considered the obstructionist may not think he's doing anything -- or, you know, destructive in terms of our country, but they're incentivized through the political climate.
SPITZER: But here are the two things that really bother me. One is the START treaty where I think there is across the board consensus that it's good for our security, it's good for world peace. It should happen. The other is the unemployment benefits to people who don't have money to buy food, pay their rent. That just makes me grieve.
PARKER: Two million Americans lost their unemployment benefits today. So how does that jive with tax cuts for the rich?
GURWITCH: Right. What I think is really confusing about this is the rhetoric surrounding this. So here on one hand, you have people like Sarah Palin saying things like, Americans are --
SPITZER: This was going to be a Sarah Palin free zone, but that's all right.
GLENN: She's breaking the rules.
GURWITCH: Talking about American exceptionalism, right? So we're cheerleading about how great Americans are. But not you guys. Not you unemployed people. I think they're being stigmatized and demonized. You guys are stuck. Americans -- how does this all live in the same world? I don't understand that. I think it's a "blame the victim" mentality. And we know that that money would go right back into the economy that would give them benefits. Doesn't make any sense.
SPITZER: It goes to a deeper issue. The social contract in this nation has fallen apart. It's been broken.
KELLERMAN: What is the argument here? As someone who knows this stuff, what is the argument here? It seems to me that not only is there a moral issue, where there are people really suffering at this moment, in terms of unemployment benefits. But there's also the stimulative issue, right, where that money goes right back into the economy, versus tax cuts that may not?
GLENN: I think that we have to have a discussion about what actually is stimulative. I helped negotiate the 2001 and 2003 tax cuts. In 2003, we forget, in the third quarter of 2003, we grew at 5.6 or six percent growth after those tax cuts were in place. The fact of what will actually govern in terms of growing this economy and give us the juice that we need to create the jobs that I think everybody around this table and around the country wants to see, I think that's the conversation we're trying to have in the United States Congress.
PARKER: I hate to interrupt you, but we have to take a break. Stay with us. We'll have more with "Our Political Party" in just a moment.
(COMMERCIAL BREAK)
PARKER: Welcome back to "Our Political Party." We've got time for just one more question.
The media have been obsessed with the WikiLeaks rightfully so, and the START treaty. What are we missing? What's the big story we haven't paid attention to?
GURWITCH: Well, I have a big story I think is very important. Actually, it was the most e-mailed story from "The New York Times" today. Vitamin D and calcium supplements are not necessary. I personally feel really ripped off.
PARKER: Right.
GURWITCH: I have been taking this stuff --
PARKER: But wait, that was "New York Times."
GURWITCH: Yes.
PARKER: Same day, "Wall Street Journal," opposite conclusion.
GURWITCH: What are you supposed to do? Not only that, I mean, look at this, Americans are spending $6 billion a year on vitamins and supplements. We could use that money for employment benefits.
PARKER: Yes, but you know what else you can do is that for vitamin D, you can sit outside for 10 minutes.
SPITZER: What does vitamin D do for you? Is that the sun?
PARKER: Sun. Sunlight.
GURWITCH: It's supposed to help actually absorb the calcium and the other supplements. I'm so angry I've wasted so much money and time doing this. I think it's a really big issue.
(CROSSTALK)
Very angry. Big issue.
KELLERMAN: I honestly believe that all -- that every issue practically in the world that is important at any one time comes back to energy policy. So, in fact, I think right now WikiLeaks and what's going on in the Congress right now are really important issues and they deserve the attention they're getting, but anything that distracts from energy policy at anytime.
PARKER: Max Kellerman, Dylan Glenn and Annabelle Gurwitch, thanks so much for coming to our party.
SPITZER: Coming up, a critical look at the president's game -- his basketball game from a surprising source. We'll be right back.
(COMMERCIAL BREAK)
RANDI KAYE, CNN CORRESPONDENT: Hello, I'm Randi Kaye. More of "PARKER SPITZER" in just a moment. First, the latest.
The Obama administration today changed course on oil exploration announcing a ban on drilling in the eastern Gulf of Mexico for at least seven years. Interior Secretary Ken Salazar called the reversal a result of lessons learned from the BP Deepwater Horizon disaster in April. Three weeks before the deadly explosion, President Obama said he would open much of the eastern gulf to drilling. Salazar said stronger safety and environmental standards need to be in place before that ban is lifted.
Amazon has booted WikiLeaks from its servers. It had been hosting the controversial whistle-blower Web site since Sunday after a hacker targeted WikiLeaks old servers. But Amazon came under growing pressure to drop the Web site after WikiLeaks released thousands of classified diplomatic cables on Monday. According to Computerworld.com, a Swedish firm outside of Stockholm is now hosting WikiLeaks.
And tonight on "360" at 10:00 p.m. Eastern Time, a crime epidemic experts say is thriving under the radar. In our series "American Slaves: Hiding in Plain Sight," tonight, we'll take you inside the battle to free child sex slaves in California. Young girls, many of them runaways, preyed on by pimps and Johns.
That is the very latest. Now back to "PARKER SPITZER."
SPITZER: Time for our p.s., Kathleen. You got to feel for the president. No matter what he does, they criticize him. The economy is bad, Afghanistan is a disaster, too partisan, not partisan enough. Now, they're even going after his basketball game. And I thought he was pretty good. Listen to what Charles Barkley said on "Conan O'Brien."
(BEGIN VIDEO CLIP)
CHARLES BARKLEY, FORMER NBA PLAYER: He's a lefty. He always goes left. And if you just stand there, I'm not sure if you open up the right side he could go right at all.
CONAN O'BRIEN, HOST, "CONAN O'BRIEN": And so you're pretty confident you would do well on the game, one-on-one against the president of the United States?
BARKLEY: Oh, yes. Come on, I mean, I'm an old fat guy now but I'll kick his ass.
(END VIDEO CLIP)
PARKER: Kick the president's -- wow, really, Chuck. Don't let the Secret Service hear that.
SPITZER: Oh, man.
PARKER: And, of course, Obama does only go to his left. Let's take a look at President Obama's game.
SPITZER: You know, I don't get it. When I watch this video, when I see the president shoot, when I see him passing off the ball, driving to the hoop, that's pretty darn good. And he even took some stitches to get that two pointer in.
PARKER: Honestly, Eliot, you can criticize the president on a lot of things but as far as I'm concerned --
SPITZER: Not on that one.
PARKER: Not on basketball. You know, but he shoots from midcourt and makes that -- what do you call it when you don't even make a sound --
SPITZER: Swish.
PARKER: A swish.
SPITZER: There you go. I can use the word. I never did it, but I can use the word.
PARKER: Well, he swishes, I mean, in a good way.
Anyway, better work on going to the right though, Mr. President, because 2012 is just around the corner.
SPITZER: Thanks for joining us tonight. Join us again tomorrow night.
"LARRY KING LIVE" starts right now.
