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Mitch McConnell, Steny Hoyer, Roundtable

Fox News Sunday

BRIT HUME, GUEST HOST: I'm Brit Hume in for Chris Wallace, and this is "Fox News Sunday."

The 110th Congress opens for business. Can voters expect quick action and a bipartisan approach to the nation's tough issues? We'll talk exclusively with two key Capitol Hill power brokers: the Senate's new Republican leader Mitch McConnell and the new majority leader of the House, Democrat Steny Hoyer.

Also, the president changes his top military commander in Iraq as he prepares a new war policy, while top Democrats say "no" to a troop surge. We'll talk about it all with our panel: Fred Barnes, Nina Easton, Bill Kristol and Juan Williams.

All right now on "Fox News Sunday."

Good morning again from Fox News in Washington. Let's get a quick check of the latest headlines.

A published report out today says top Israeli military officials are drawing up plans to launch a preemptive strike against key Iranian uranium enrichment facilities. According to the Sunday Times of London, any such attack would include the use of tactical nuclear weapons to destroy underground plants near Tehran. An Israeli official denied the report, calling it absurd.

New information is coming out about what President Bush might propose as part of his new Iraq policy. In addition to a surge of troops, one report today says the plan might also include $1 billion for a jobs program in Iraq.

And in Iraq, three army brigades from the Kurdish north and Shiite south are being moved into Baghdad as part of a new security crackdown. So far, in the last week, nearly 90 terror suspects have been arrested and another 30 killed in a series of raids.

Joining us now to discuss the new Congress and upcoming changes in the U.S. policy on Iraq is the new Republican leader in the Senate, Mitch McConnell.

Senator, welcome to "Fox News Sunday."

SEN. MITCH MCCONNELL (R-KY), MINORITY LEADER: Thank you, Brit.

HUME: Congratulations on your elevation to leader.

MCCONNELL: Thank you.

HUME: Let's assume for the sake of discussion that the president comes out now sometime this week and he says he's going to send something in the neighborhood of 20,000 troops -- that's the number that seems to be out there now -- additional troops, and that he would like something on the order of a billion dollars to spend on a jobs program in Iraq. We're hearing, even from Republicans, increasingly skeptical sounds about the continuation of the effort in Iraq. Gordon Smith from Oregon, Norm Coleman of Minnesota, Sam Brownback of Kansas, Chuck Hagel of Nebraska have all expressed skepticism.

Will Senate Republicans go along, in your judgment?

MCCONNELL: Well, look, I think we need to keep in mind the goal there is to win. And the definition of winning is to have a reasonably stable government that's an ally in the war on terror, that is stable enough to allow us to begin to draw down our troops. And clearly that's not the situation at the moment in Baghdad.

Senator Lieberman, for example, in the Democratic conference, believes that the surge is a good idea.

I think to basically begin to withdraw before the job is finished is a mistake. If the president recommends what we seem to believe he's going to recommend, I intend to support him.

HUME: What about your colleagues, though?

MCCONNELL: I think there will be some who will and some who won't. Congress' tools to micromanage the war are quite limited. About all the Congress could do, if it chose to do it -- and I don't believe it will choose to do it -- would be to cut off money for the troops.

Beyond that, we could pass resolutions, we can have hearings, we can debate the matter, which we will do. But I don't think Congress will have the ability to simply micromanage the tactics in the war, nor should it.

HUME: Well, it certainly could refuse to fund an additional billion dollars' worth of a jobs program, though, couldn't it?

MCCONNELL: It could.

HUME: That wouldn't be too hard to do -- particularly, you'd have to get that through the House. We're going to talk to Steny Hoyer later about that, but what about that possibility?

MCCONNELL: Well, I think a jobs program makes a lot of sense. I mean, unemployment is clearly a problem there. I suppose they could refuse to fund that if they chose to.

Look, this will be a big debate. It's been a big debate in the country for the last two years.

At the end of the day, though, I don't think Congress will cut off money for the troops. Congress is incapable of micromanaging the tactics in the war. And even though this will be a controversial step, I think the president will be able to carry it out, and I hope he'll be successful.

HUME: Let's talk a little bit about the personnel changes we've seen this week. John Negroponte, director of national intelligence, moves from a job he'd less than two years to become the deputy secretary of state, or one of them anyway. Vice Admiral Mike McConnell has been asked to take the job of DNI. They both face Senate confirmation issues.

There's also reports that Zal Khalilzad, who's now our ambassador in Iraq, would go to the U.N. to be the ambassador there. General Casey is on his way out, to be replaced by General Petraeus, David Petraeus, a well- known figure. Ryan Crocker would be apparently named to go to Iraq as the new ambassador there.

So, question: What do you think about -- taken together, this is a pretty sizable shake-up. I think Senator Rockefeller, for example, chairman of the Intelligence Committee, says he was not informed about the Negroponte move. He's upset about that.

How is this all likely to go down? Are any confirmation issues likely to occur here?

MCCONNELL: I don't think so. What this means is change. I mean, the president signaled the day after the election that he was certainly not happy with where we are in Iraq. He did that by changing the secretary of defense. And now he's changing the entire team and signalling we're going in a new direction.

He made it perfectly clear he wasn't satisfied with the progress that we're making, and if you're not satisfied with the progress and you're the CEO, it might argue for shaking up the team. I think that's what he's done.

You mentioned Dave Petraeus, General Petraeus, a really outstanding choice. I got to know him in Mosul up in the northern part of Iraq in 2003, where he did an extraordinary job, not only the military part of the exercise, but also in dealing with the locals and, actually, on a short- term basis up there, establishing a pretty solid local government.

HUME: General Casey and General Abizaid, who's also leaving, believe that infusing more troops into Iraq -- you see his replacement will be Admiral Fallon; we've just had that up on the screen there -- believe that infusing more troops into Iraq ran all kinds of risks, not the least being that you enlarge the impression of -- indeed, the fact of occupation. You also give the Iraqis a way to do less because we're doing more.

The president seems to have overcome doubts about that. You were supportive of the way it was being done. What has changed your mind?

MCCONNELL: Well, look, this was one of the debates from the very beginning of the war, just how many American troops do you have there, how big is the footprint, whether it's a positive or a negative in terms of acceptance locally.

What we know for sure, Brit, is that, by this fall, whatever we were currently doing was not getting the result. So the president, demonstrating I think considerable flexibility, has decided to adapt the tactics and to try a different path to get to the result that I think everybody in America wants. Even the critics of the war would like to have a success.

So I don't think the president should be criticized for, A, recognizing that things were not going well and, B, making substantial changes in order to achieve the goal.

HUME: Let's talk about the situation here at home and here in Washington. It was quite a striking tableau this week when both Majority Leader Harry Reid came out and said that you and he were going to work together, and you said the same thing. And you guys sounded like the best of friends. I don't doubt that you are, at least behind the political scenes.

What is that a reflection of, Senator? Is that a reflection simply of the political realities of the Senate when it's poised on a knife edge, or is that a reflection of something deeper?

MCCONNELL: Look, you can always use the next election as an excuse for not doing much. And in the Senate, the minority can guarantee that not much is done. And what I've said to the new majority leader, "You won the election fair and square. You're in the majority. It is not my first goal every morning to get up and make you look bad."

So we want to see if we can't advance the ball on a number of significant issues down the field for the American people. And I don't think we ought to just constantly operate as if we're thinking about the very next election.

HUME: But you know you can stop anything.

MCCONNELL: We can, but we choose not to do that. We're going to be able to get off to a good start with ethics reform and probably craft a minimum-wage increase that's acceptable to both sides and see how far we can get on a cooperative basis.

HUME: Let's talk about ethics reform for a moment. The House has passed a package. It's fairly strict -- a lot of things that you can't do anymore. You can't have lunch, you can't take tickets, you can't do a lot of things.

Is the Senate going to do the same thing?

MCCONNELL: Yes, I think so.

HUME: Roughly the same?

MCCONNELL: Yes, roughly the same.

HUME: Let's turn to the minimum-wage increase. The president seems prepared to accept that as long as it's coupled with tax relief and other ways to cushion the blow that it might be to small business.

Are you and Senator Reid on the same page on that? Do you think that will happen?

MCCONNELL: I think so. In his opening speech the other day, he indicated he thought that was a good idea. And it's important to remember the last time we raised the minimum wage, it was coupled with small- business tax and regulatory relief at that time, and President Clinton signed it. So that's the path to get a result. I think we will get a result pretty soon.

HUME: There's a system of budgeting or of dealing with spending issues called PAYGO; it's called PAYGO for short. It means pay as you go. That means an increase in one area or a decrease in revenue caused by a program in some area must be offset one way or another by either more revenue or less spending in some other area. It's an idea that's been around and tried for some time.

The House says that's how it's going to operate. How's the Senate going to operate on that?

MCCONNELL: Well, what PAYGO really means is you're going to have a tax increase. And most Republicans are not going to support the PAYGO provision. It almost guarantees that the majority, if it enacts it, will try to raise taxes.

We don't think raising taxes is a good idea. The tax cuts of '01 and '03 have clearly stimulated the economy. We've created 7 million jobs since 2003. Our economy is the envy of the world. We have 4.5 percent unemployment.

The last thing we need to do is to be raising taxes in this country, and PAYGO is the first step toward raising taxes.

HUME: Do you believe, then, that if it came to that, that this is an area where the filibuster might be the tool at hand?

MCCONNELL: Well, I think there will be very few, if any, Republicans who will support raising taxes.

HUME: One issue that the House Democrats haven't said much about but was an issue that at least on paper looks like one where a lot of business might get done is immigration. The House Democratic position on immigration issues, or at least some of them, is very close to what the president has been for. That's true of the Senate Democrats and many Republicans as well.

Do you think an immigration bill is possible this term?

MCCONNELL: I do. In fact, I've been challenging the new Democratic majority not just to do the easy things in the beginning of this session or some relatively easy issues that we were close to passing last year, but let's do some important things.

And I think there are two things, Brit, that are very significant that would make a difference for the country. Let's fix the immigration problem, and let's save Social Security. We can do that before this Congress is out.

HUME: Do you really think it's possible to pass a Social Security reform package? MCCONNELL: I think it can only happen with divided government, that is, one party in the White House and another party in Congress. Divided government is the only way where you can kind of share the blame for doing big things that will sometimes become controversial.

Two examples: Social Security, when Reagan and Tip O'Neill brokered the deal in the mid-'80s; welfare reform...

HUME: That was a tax increase, though.

MCCONNELL: Well, we'll see what the substance is. I'm just talking about the process of getting there.

HUME: Right.

MCCONNELL: In the mid-'90s, welfare reform with Clinton in the White House and a Republican Congress.

We all know that the baby boomers turn 60 in 2006. Over the next two decades, 77 million people are going to be retiring. We need to fix Social Security, and the best time to do that is when you have divided government.

HUME: Will Senate Republicans, in your view, support a measure that would simply deal with the fiscal side of this, possibly by a benefit reduction and/or an increase in Social Security taxes, without private accounts or some other consequence of reform?

MCCONNELL: Well, we can't negotiate the deal here this morning. What I'm saying is that we ought to establish a process that will produce a result, and then sit down with everything on the table and talk about how to save Social Security.

HUME: You think it can be done.

MCCONNELL: I do think it can be done.

HUME: Do you think it will be done?

MCCONNELL: We'll see.

HUME: Senator McConnell, it's a pleasure to have you, as always. Thank you for being here.

MCCONNELL: Thank you.

HUME: Up next, the new House majority leader, Congressman Steny Hoyer of Maryland. He'll be right with us after a break.

(COMMERCIAL BREAK)

HUME: With us now to talk about the Democrats' agenda in Congress is the new House majority leader, Congressman Steny Hoyer of Maryland.

Welcome to "Fox News Sunday."

REP. STENY HOYER (D-MD), MAJORITY LEADER: Good morning, Brit. Glad to be with you.

HUME: Congratulations on your elevation to leader.

HOYER: Thank you very much.

HUME: Let's talk for a moment here about what we now think the president is going to propose or announce this week, something on the order of 20,000 more troops, as you heard me mention to Senator McConnell; the possibility now, we're hearing, of a billion-dollar package to try to enhance the job situation in Iraq.

What is likely to be the reaction among House Democrats, many of whom were elected to oppose this war, to that, those two ideas?

HOYER: I think that two things: First of all, we see this simply as an escalation and not a change. Essentially, we've gone up and down on troop levels before. We did so just recently. And when we sent troops into Baghdad, we sort of had community-by-community success but a general escalation, both in violence, sectarian confrontation, and loss of life.

So we don't see this as a new policy, and I think it's going to be greeted with great skepticism. We've also done the economic investment before -- unfortunately, with not very good positive results. So I think great skepticism, as Senator Levin said in the Senate and Senator Warner said. They want to look at this proposal.

We have General Abizaid, as you know, interviewed a lot of people on the ground, including General Casey, who's now going to be chief of staff of the Army, and said that they don't think an escalation in the troop levels will work or will be helpful.

HUME: Can you foresee this -- I assume it's unlikely you'll try to stop it.

HOYER: Well...

HUME: Or am I wrong about that?

HOYER: You're probably right, but I think it's too early to say that. After all, there are going to be many, many hearings, 10, 15, a series of hearings by various different committees over the next three weeks, four weeks, on this proposal.

This is a serious issue confronting this country. Iraq has probably been our biggest immediate challenge, how we move forward.

All of us would like to have success. All of us would like to bring stability and security. We haven't done that in four years, notwithstanding the president's claim that it was just around the corner.

HUME: What would you say, then, the prospects are for something on the order of a billion dollars in new money for the Iraqi economy?

HOYER: I think that the Congress has a responsibility, which we haven't done over the course of this war, of serious oversight to see how the money is going to be spent and whether it's going to be effectively spent, because it hasn't happened in the past.

HUME: You're not saying, though, that it can't pass, are you?

HOYER: I'm not saying that. I'm saying that it's going to get careful scrutiny and oversight to see whether or not we believe that is a good expenditure of the taxpayer's dollar.

HUME: Whatever has been tried so far, there's been a tendency, we've just kind of rocked along...

HOYER: Yes, sir.

HUME: ... and things have gotten worse, by many measurements.

If that continues, regardless of what the president is trying, do you think there will come a day in the not-too-distant future when there will be an effort coming from the House to cut off the funds for this war?

HOYER: I don't want to anticipate that, Brit.

Clearly, first of all, let me reiterate, the Democrats and Republicans are going to support the troops. We're not going to put the troops in any greater risk than they currently are. We're going to make sure they're supplied. We're going to make sure that they have the resources they need.

Having said that, there seems to be broad agreement, except in the White House, from the military, from the Hamilton-Baker commission, from the American public, that what we're doing is not working. And, frankly, I don't see this as a change in...

HUME: You don't see it as a change, but, on the other hand, adding troops, changing -- the command is changing. Abizaid has moved out. Casey has moved out. General Petraeus, generally pretty highly regarded, will be the main man there. Vice Admiral Fallon will be the new CENTCOM commander. And yet you say no change here?

HOYER: Let me except (ph) the fact that these are all good people, but the fact that we have a new secretary of defense or the fact that we have a new CENTCOM commander or Petraeus on the ground in Iraq, if the administration's policy remains the same, then we're going to have the same-old-same-old.

We have urged in, as you know, three letters that the Democratic leadership sent -- Nancy Pelosi and Harry Reid sent a letter talking about redeployment.

HUME: Redeployment means leaving, though, doesn't it?

HOYER: No, not necessarily. Redeployment means perhaps, kind of, stepping back and making sure, as General Casey indicated and General Abizaid made clear, that you need to give to the Iraqis a very clear signal, "This is your responsibility to bring security and stability to your country, not U.S. troops. We can help. We can help on logistics. We can help on training. But this is your fight. And if your country is going to be stable, it is because you show a willingness to make it so."

HUME: Let me move to this week, this remarkable week, when you had the historic moment of Speaker Pelosi emerging, the first woman ever to hold that. You got a 100-hour strategy and a number of measures, some of which I mentioned with Senator McConnell, to address a number of points.

You're going to push this through in the way that a majority can in the House. The Republicans are not going to really have much of a say in this. That certainly won't be the first time the minority has been in that position; let's stipulate that right away.

(LAUGHTER)

But in retrospect, when planning this, do you think it was possibly a mistake to do it that way? I mean, even if the Republicans were given a shot at this, you can hold your majority together, particularly this first week, you could have stopped whatever they wanted to do.

Was it not a mistake to make it look like you're going to step on their necks in the first week?

HOYER: Brit, I think not. And if you look at what we've done so far, essentially adopting four different things -- on rules, on ethics, on how we're going to move forward, on PAYGO, fiscal responsibility -- overwhelming support, as you have seen. I mean, we had one vote that was unanimous; one vote that only Dan Burton voted against; another vote on fiscal responsibility, 280 people in the House -- we only have 233 -- voted for that. So we've moved forward.

Now, as you point out, Speaker Pelosi indicated that there were six items that we were going to move on in the first 100 hours. And they were debated fully over the last six months of the campaign. And the American public said, "We want a change. We want a new direction. And we're giving Democrats the responsibility to do that." So we are indicating to the public that we are moving ahead.

9/11 Commission recommendations? Going to be adopted. Clearly, they have been debated for well over a year. We've done some, but the commission gave us D's, E's and F's and incompletes on others.

E's, that's an old-school term.

(LAUGHTER)

HUME: I got a few of those myself.

HOYER: Yes, right, I got you.

(LAUGHTER)

I'm not going to admit to that, but, in any event, that's where that comes from.

We're going to make sure the 9/11 Commission -- interoperability, reduction of nuclear items around the world, Nunn-Lugar is strengthened -- we're going to move ahead on those. Then we're going to move on college costs...

HUME: Right. Got you.

HOYER: ... minimum wage -- you know, the litany.

HUME: Right. Let's talk about...

HOYER: Prescription drugs.

HUME: ... the pay-as-you-go system. You've also promised to do something about the alternative minimum tax.

HOYER: Yes.

HUME: The problem of that alternative minimum tax, of course, is it raises a lot of money. And if you were to try to adjust that, undo it, fix it, you'd need to find some more money somewhere to obey your pay-as-you-go policy.

How can you do that without a tax increase in other parts of the...

HOYER: Brit, first of all, let me say something -- maybe not. That is to say, maybe the AMT can be fixed in a zero-sum game. That is to say, you can adjust the AMT without, in effect, either raising more money or reducing revenues.

HUME: Do you think that's possible?

HOYER: It's possible. We're looking at that.

And, obviously, the AMT was designed in the '80s to get those corporations or individuals who were making vast sums of money but who were not paying taxes because they were relying on preferences. (CROSSTALK)

HUME: ... fixing it is very popular.

HOYER: So doing away with it is not what we ought to do. But adjusting it so that people, for instance, making up to $250,000, $300,000 not have a tax increase imposed upon them, not because necessarily their tax bracket should have changed, but by inflation and by the operation of the AMT, they are paying additional taxes. We don't want to see that happen.

HUME: You heard Senator McConnell say that he thinks an immigration bill can be done. Do you now think so, as well?

HOYER: I think so.

As a matter of fact, Brit, it was interesting, when Nancy Pelosi and I met with the president -- as you recall, we had a lunch shortly after the election. The president was very gracious.

And one of the things that we brought up -- we didn't discuss substance -- was the immigration bill. And he smiled and he said, "You know, I think I'm going to have a lot easier time dealing with you on immigration than I had dealing with the House Republican leadership on immigration." I think that's the case.

HUME: You also heard Senator McConnell speaking optimistically about this situation: Divided government being the only one in which a Social Security fix is possible. Do you agree with him on that?

HOYER: I don't know that it's the only one, but it certainly is, from past history, a way in which it can be done. Past history being, you will recall Ronald Reagan and Tip O'Neill came together. Social Security was in crisis in the early '80s, 1981, '82. They came together; there was a commission. But it was really Reagan and O'Neill's willingness to sit down together, if not physically at least through their staff, and come up with a solution which stabilized Social Security for the next 60 years, '83 to 2043.

I think that model can be used again. I think we need to do it.

And, by the way, Social Security is much easier, in my opinion, to address than Medicare and Medicaid, which are going to hit us sooner and harder.

HUME: And you don't think there's much chance you're going to...

HOYER: Well, I think, you know, we could have -- and I've discussed this with the president -- we could have an extraordinary opportunity here. We have a president who has two years left to go in his term.

HUME: Right.

HOYER: He wants to make a record. I talked to Secretary Paulson in my office just a few days ago and indicated to him that Speaker Pelosi and myself, I was sure Harry Reid and Dick Durbin and the Democrats are prepared to sit down, as Mitch McConnell indicated, with no preconditions, as we felt the president put forward on his private accounts in the previous discussion which the American public rejected.

HUME: Can you override a veto, a presidential veto, on federal funding for stem-cell research? I know that's one of your priority items. It's going to pass here in the House.

HOYER: It is going to pass. And hopefully it's going to -- we believe it will pass the Senate.

Can we override a veto? Doubtful. Depends upon what the Republicans do, both in the Senate and in the House.

But let me say something, Brit. The six for '06 that we are putting forward -- those six agenda items on 9/11, minimum wage, college costs coming down, energy, taxes being diverted, revenues being diverted to alternative, and stem cell -- the fact of the matter is, over 70 percent of the American public, in polling, supports all of those proposals.

So I am hopeful, A, the president will reconsider. He's reconsidered on minimum wage. He's already indicated he's going to sign the minimum-wage bill.

HUME: If he gets the safeguards he wants, though. Are you prepared to give him those?

HOYER: We'll see. We're going to pass the minimum wage through the House...

HUME: Clean?

HOYER: Clean. We believe it ought to be passed clean. It is, I think, a national...

HUME: He won't accept it that way, though.

HOYER: Well, we'll see. We believe it's a national scandal that the lowest rung of workers in America have not gotten a raise in 10 years. It's the longest time in the history of minimum wage that we haven't raised it.

HUME: Congressman Hoyer, we've about exhausted our time. Thank you for coming. It's good to see you, sir.

HOYER: Brit, I enjoyed being with you. Thank you very much.

HUME: You bet.

HOYER: We look forward to a new direction for our country.

HUME: All right, sir. Thank you. Coming up, our Sunday panel on the political fight over the war in Iraq, first of all. We'll be right back.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN (R-AZ): The surge must be substantial and it must be sustained. We will need a large number of troops.

SEN. HARRY REID (D-NV), MAJORITY LEADER: The surge is a bad idea. The president has said he was going to listen to his commanders. If he's listening to his commanders, he can't do this.

(END VIDEO CLIP)

HUME: That, of course, Senator John McCain first and then the Senate Majority Leader Harry Reid, with very different views about sending more troops to Iraq.

Well, it's panel time for Fox News contributors Fred Barnes of the Weekly Standard; Nina Easton of Fortune magazine; Bill Kristol, also of the Weekly Standard; and Juan Williams of National Public Radio.

Well, you heard it reflected in those comments we just played. You heard it reflected in the interviews today, Steny Hoyer reflecting the views similar to those of Harry Reid that this is, in his view, A, not new, this idea of sending, what, now, 20,000 troops to Iraq.

If the president unveils this, it's going to be a huge controversy. What about the merits of it from a military point of view, Fred?

FRED BARNES, WEEKLY STANDARD: Well, in truth, as Senator Reid said, the president is not doing what his commanders on the ground have urged, mainly because their policy has failed. Baghdad is not secure. It's the center of great chaos and turmoil and violence in Iraq.

So he's done what Abraham Lincoln did. When your commanders are not winning, you bring in new commanders. After all, he is the commander in chief.

So the idea here in the beginning, of course, is to secure Baghdad with more troops, and as we know from the announcement by Prime Minister Maliki of Iraq on Saturday, more Iraqi troops, as well, to try a counterinsurgency strategy where you secure neighborhoods and hold them and make them peaceful for the Iraqi people, and then gradually expand them. You can't -- you can't win the war in Iraq without having a secure Baghdad, and that's what this policy in the beginning is designed to do. And then you go beyond Baghdad to the relatively few other areas where the insurgency exists.

NINA EASTON, FORTUNE MAGAZINE: I think the political dynamic of this war is about to change in this city, because the surge is going to be accompanied, we know now, by this billion-dollar jobs plan, which is going to send to Congress, a Democratically-controlled Congress -- the Democrats, who have by the way not answered that what next question. So we redeploy, so we move troops out, what next? Particularly if the country descends into some kind of terrorist chaos.

But the Democrats will now by virtue of this budget process have to take some ownership in this war and the direction of it. And the White House by contrast hasn't been subjected to any serious oversight of this war, and now they will be. So I do think that this will become -- this is a moment -- it's not just about the surge, it's about these other pieces that will have to -- that Congress will have to weigh in on in a Democratic-controlled Congress.

BILL KRISTOL, WEEKLY STANDARD: Well, it's the governance to choose. And President Bush has chosen to change strategy in Iraq in a way that I think makes sense. The new rationale for the new strategy has been laid out in great strength by retired Army Chief of Staff Jack Keane, and Fred Kagan, and now I think David Petraeus...

HUME: Are 20,000 troops enough, Bill, to do what they've called for?

KRISTOL: I don't know. Well, the Keane and Kagan plan calls for four or five brigades in Baghdad and one or two Marine regiments in Anbar, which will be a little more than 20,000.

They may phase them in. So it might start with 20,000. But look, Dave Petraeus is going to take over. And he's committed. He's taking over with a mission, win the war. And if he comes back to the president a month from now, when he's in command on the ground and says, let's accelerate the surge in -- which I think would be a good idea, frankly, frontload the surge -- it could be 30,000 or 35,000 troops.

But Bush has decided he's going to fight to win. Now, some people think it's hopeless and they want to get out. They should make that case. But they have to make the case seriously. What's the alternative? In the Reid-Pelosi letter to the president that was released on Friday...

HUME: Yes, hold on a second, Bill. We'll just take a look at a piece of that letter.

"Surging forces is a strategy that you have already tried and that has already failed. Rather than deploy additional forces to Iraq, we believe the way forward is to begin the phased redeployment of our forces in the next four to six months." Now, that's something that you heard Steny Hoyer talking about, Juan, redeployment. I said that means withdrawal. And he demurred a bit. But isn't that it comes down to? I mean, it is about either doing more or getting out gradually?

JUAN WILLIAMS, NPR: Gradually, but also, we're only talking here military options. And there's more than military options on the table, as we'll hear from the president this week. Nina touched on it. You'll also going to have reconstruction money. You're going to have micro loans. You're going to have jobs programs.

HUME: What about all that? Can that pass Congress?

WILLIAMS: Oh, I think Congress -- if it's presented as a way, a new option for Iraq, fine. People are going to give it an honest look. I don't think -- it's not the case that Democrats don't want success.

But to come back to something Bill Kristol was saying, we have to define what success is. What does victory mean? I don't know that you can beat the Iraqis militarily. You know, it's like an unruly third grade class. You're not going to go in there and smack people around and all the kids are going to line up. I don't think it's going to happen at this point. I think we have got trouble there, a civil war, and what we have got to do is protect our interests. And our interests should be that we don't allow it to become a breeding ground for terrorists.

HUME: I know, but how do you do that with forcibly suppressing this insurgency?

WILLIAMS: Without -- well, you can't. But it's not -- the question is are you dealing with people who are al Qaeda, Brit, or are you dealing with people who are Shia versus Sunni...

HUME: You're probably dealing with both those things.

WILLIAMS: Correct, so then you have to rely on al-Maliki, the prime minister, to try to control people like Muqtada al-Sadr and stop the Shia violence. And that's one of the options that the president is going to describe on Wednesday is, that the U.S. force mission will really be to stop the Sunni and make sure they control the Sunnis, but al-Maliki has got to take care of the Shia.

And for the moment, he's got Kurdish forces coming down. I don't think the Kurds have any interest in it. They don't have the moral authority.

HUME: So?

WILLIAMS: So one last point here is, when it comes to the U.S. military, adding 20,000, which Bill and others say might not even be enough, it's stretching the U.S. military to its very limits. We don't have the capacity here to do this. And that's why it's going to have to be phased and it's not going to be enough, and it's going to put -- going back to what Fred said, we're going to go into every neighborhood, Fred, we're going to become more targets of opportunities for the bad guys. And how long would you leave us there?

BARNES: Well, there's a great history of counterinsurgency, and of course the new Army counterinsurgency manual was largely written by General Petraeus. Counterinsurgency has worked. You go in, you secure the area, you pacify it so the people can carry on a normal life, and you do this starting in the areas where the violence is. These are mainly the areas of mixed Sunni and Shia residents. And then, after you do that, which is I think quite winnable -- you can't guarantee that -- but after that, then you go after the Mehdi army of al-Sadr.

And look, Juan, you say there's a civil war. Well, there's something like a civil war going on in Baghdad, and that's it. Then you have the other 90 percent of the country...

(CROSSTALK)

WILLIAMS: But Fred, haven't we done this dance before?

BARNES: You have to control -- you have to control your capital city. No question about that.

WILLIAMS: Yes.

BARNES: And so that's where you start.

I think this is quite winnable. General Petraeus thinks it's quite winnable. Your strategy would have been to stick with General McClellan if you were in the Civil War and you would have lost.

WILLIAMS: I'm just saying, haven't we done this dance before? I think you and I have been here when we put 12,000 in last summer, and we said we're going to capture and control Baghdad. Right? And what happened? We saw more violence than ever.

KRISTOL: And what's the implication of that? If we try something on a too small a scale and it doesn't work, we give up? Hey, we're all cynical Washington guys. We've done this before.

(CROSSTALK)

KRISTOL: Politically, it sounds bad. So Bush is supposed to give up. I really -- what's the alternative?

WILLIAMS: Well, the alternative...

EASTON: The bottom line is, Iraqi security forces at some point have to be up to the job, which they're not now, and this is the problem the president faces in selling this plan. You know, at what point are Iraqis going to take over their own security? At what point?

KRISTOL: Well, I think in a couple of years, if we first provide security. But they're not up to it now. They aren't up to it now. And people can say -- can dump on the Iraqis all they want, and they don't like the execution of Saddam and the sectarian violence. Still, the question is, is it in our national interests to lose this war in Iraq?

You know, all this talk of redeployment, the one sentence we didn't quote from the Pelosi-Reid letter is the key one, I think. "It is time to bring the war to a close." That's what underlies the critics of the war's view. They don't have an alternative strategy. A few do. A few do: Pull back, deploy forces around Kurdistan. I haven't seen that argued very well, but that's plausible.

But really what this is about is, quote, "bringing the war to a close." But the war is not going to be brought to a close. If we withdraw, the war is going to get worse. More Iraqis are going to get killed. Does anyone doubt that?

2007 is going to be a bloody year in Iraq. Period. That's just a fact. The question is whether it's a bloody year on the path to success for the U.S. in a vital strategic interest or whether we lose.

WILLIAMS: Let me just suggest to you that everybody wants it to be a success in terms of stopping violence, not -- I mean, what the Iraqis are doing in terms of the civil war, I don't know if we can control that. But we want to stop violence. We want to stop the spread of Iranian influence in that region. We want to make sure that that's controlled.

But if you're talking about American political support for an extended -- you said years, in other words pudding additional forces on the ground for years, you must remember, I think it's at most 18 percent of the American people support the surge even for a short period of time.

And let's look not at the Democrats, but let's look at the Republicans. Let's look at -- I think I saw this week it was only, like, 12 of the 49 Republicans in the Senate support a surge, Bill. What does that tell you? The support is not there on the right.

HUME: Well, let's ask this question -- and I tried it earlier with Congressman Hoyer. Let's assume that this surge goes forward, they can't stop that. The Congress can't really stop him from sending the troops. It could refuse to send the money, as we talked about earlier. But let's assume we rock along here, and it is a bloody year and the outcome isn't clear, which it likely won't be for some time. Can you imagine this Congress sitting by without an effort, particularly in the Democratic- controlled House, to cut off the money?

WILLIAMS: I think it's difficult for them politically, because it would put them in the position of being portrayed as surrender monkeys.

HUME: Yes, but can they do otherwise? Remember who elected them.

WILLIAMS: Right. Well, that's why -- there's going to be pressure from the far left to really stand up for your principle here, to say exactly what you believe and not simply make it a matter of political strategy. But you're going to have hearings that begin this week. Joe Biden and others that are going to be all over the networks and I think the Democrats are going to say, we're exposing the failings of the administration's policy.

HUME: All right. Let's keep those thoughts on this, because we may want to continue with this, because we talk in the next segment about the new Congress, about the new speaker and what the Democrats plan to do. Stay tuned.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

REP. NANCY PELOSI (D-CA), SPEAKER: The election of 2006 was a call to change. Not merely to change the control of Congress, but for a new direction for our country. Nowhere were the American people more clear about the need for a new direction than in the war in Iraq.

(END VIDEO CLIP)

HUME: Well, there she was, the new House Speaker Nancy Pelosi making clear what many Democrats want regarding the war in Iraq, that is to say change.

We're back now with Fred, Nina, Bill and Juan.

Nina, we raised at the tail end of that last segment this whole issue of can the Democrats really sit by unless there is dramatic change for the better in Iraq and relatively soon, without moving to stop the war by cutting off the funds? What's your thought?

EASTON: They have said they are not going to do that, and I think it's a politically dangerous proposition to cut off troop funding. And all through this past election, keep in mind, there was a lot of emphasis on, you know, we need to provide body armor for our troops, this administration is not doing enough to keep them safe.

They don't want to be in a position of looking like they're defunding the troops.

However, I do think I go back to this question about the reconstruction aid and any other elements that will be part of the president's package this week that have to go through Congress. That provides a tremendous opportunity for Congress to get its hands in the direction of this war and the funding of this war, and I think -- I think we'll see that.

By the way, the supplemental budget that's coming up for the war to fund the war will probably put it over the cost of the Vietnam War, which gives them...

HUME: Ammunition.

EASTON: ... rhetorical ammunition.

HUME: Right.

EASTON: Yes, there's pressure from the left. We saw Cindy Sheehan this week disrupting leading House Democrats, you know, trying to hold their feet to the fire.

HUME: But I come back to this question. That's not going to subside.

EASTON: No, it's not.

HUME: And the Democrats are for redeployment. They're not going to get -- the president is not going to redeploy the troops, which by that means withdraw. I don't mean they have some idea about withdrawing to nearby places, but they want to get American troops out of Iraq. The president is going to put more in. He can do that.

If he does that, is it really -- can it really be likely that the Democrats will sit by and allow that to happen without at least a lot of them trying to stop the money?

(CROSSTALK)

BARNES: You see, what Nina is talking about are the leaders. They're saying no, no we're not going to try to defund the troops in Iraq. That's not the way it happened in Vietnam when the war was ultimately defunded. It started with the back benchers, and that's where the pressure is, and that's where there is a lot of opposition among Democrats to the war. That's where an effort will come from trying to defund the American effort there.

You're not going to hear about it first from Harry Reid and Nancy Pelosi, and, of course, Cindy Sheehan is a crackpot. She doesn't matter. But there are an awful lot of back bench Democrats in the House and Senate who do matter, and they're the ones that I think will be beginning to promote this idea of defunding it very soon.

KRISTOL: Some of the Democratic leadership said they still want success in Iraq.

HUME: You heard Steny Hoyer say that today.

KRISTOL: Right. If they do and if they think there isn't enough body armor, which there may not well have been, they should increase the supplemental and appropriate more funds for the urgent production of body armor. If, as is the case, the Pentagon has not gone on a 24- hour shift to replenish some of the equipment that's been damaged in Iraq -- what's been slowing down the surge is that we haven't fixed and refitted some of the equipment that's exhausted, and, you know, that gets nicked up -- more than nicked up -- by being in battle in Iraq, then the Democrats should insist on the Pentagon going to a war footing and appropriate more money for overtime for contractors to fix up this equipment so the surge will be more effective. I mean, if they're serious about winning the war, they can help the president win the war. They're not.

The truth is, they want to get out. They want to take political shots at the president. Let me say a word about the president since we're talking about Congress this whole show. This is a rare act of political courage by George W. Bush. He has replaced -- the easy thing to do would have been to follow the Iraq Study Group. Bipartisan consensus, gradual withdrawal, the entire Washington establishment on board. The Democratic leadership had said if the president follows the Iraq Study Group, we're going to sort of support him.

Instead, he's gone against the establishment. He's decided he has to win the war. He's taken a fresh look at what it takes to win the war. He's replaced his secretary of defense, his commanders on the ground. He's put everything on the table for this. And it's against the polls, as Juan reminded us in the last segment. Give him credit: He's doing what he thinks is right, and I think he has a good chance to succeed.

WILLIAMS: Look, what you've got here is you guys are trying to make it out that it's just the Democrats versus the heroic George W. Bush, a man of resolve and a man who is now much like President Lincoln changing commanders because he realized they're on the wrong track...

KRISTOL: Well said.

WILLIAMS: Thank you, thank you, my friend. But could it be that Republicans like Chuck Hagel are right when they say that throwing more troops in there is like Alice in wonderland, or I think it was Tom Friedman in the New York Times wrote this week, it's like a bad couple, a bad relationship saying, oh, we'll solve it, we'll have a baby. We'll just put more pressure on everything.

And we'll watch everything collapse as a result, I think.

The issue is not body armor. Gosh, everybody would be glad to protect the troops. That's exactly what the Democrats feel they have to do, say that they are clearly on the side of the troops. That's what Brit was after. OK. But then what do you really do in terms of dealing with a war that has no political support at home and is going badly in the field? I think you've got to then look at different strategies, which is why we come to the idea put forward by the much maligned Iraq Study Group that we look at bringing together everybody who's on the playing field in that neighborhood, having some talks. We look at how we can deal with al Qaeda more effectively, we look at economic solutions. What is wrong with looking beyond the military?

BARNES: Because you have to have a military solution before you can have any sort of a political solution, which is what you're talking about.

Look, the problem with what the Democrats are proposing -- and they want to end the war. They're not talking about winning the war, they're talking about ending the war. And the things -- their policy of redeployment, which means retreat, would produce exactly the result which they say they don't want. They want less violence. It will produce more violence if you start pulling out American troops. They want less interference from the Iranians and the Syrians and other countries around there, which are up to no good. You will get more of that. They want a stable Iraqi central government. This will -- their policy will undermine that.

HUME: OK. Let's spend the last few minutes -- we only have a few minutes left here -- just with a quick run-through of the issues that have been raised by the Democratic majority in the House. First of all, the minimum wage increase. Are we likely in your view to get that with the safeguards for the middle class -- I mean, for small business?

EASTON: I think we'll get that. There's a House Republican proposal to link it to some sort of small business health care plan. There's a Senate proposal...

HUME: Do you think it will happen?

(CROSSTALK)

EASTON: I think that will happen.

HUME: The president will get a bill he can sign?

EASTON: I think that will happen. I think the -- you know, stem cell, he'll probably veto.

HUME: Successfully?

EASTON: Successfully.

HUME: Right.

EASTON: The 9/11, there's also the 9/11 Commission recommendations.

BARNES: Well, on those, Democrats have to figure out which ones they want...

(CROSSTALK)

HUME: What will be the effect of the pay-as-you-go method of approach in the House? Will this lead inevitably to a proposed tax increase?

EASTON: Well, the Republicans are certainly going to make it sound like...

HUME: Well, do you agree with that or do you think they're wrong?

(CROSSTALK)

EASTON: I think it could lead to a tax increase...

HUME: What will happen if that happens?

EASTON: ... and that would be vetoed. KRISTOL: I think the Democrats will desperately try to avoid raising taxes for the next two years.

HUME: Will there be an immigration -- do you think we'll get an immigration bill?

KRISTOL: I think that's possible, yes.

HUME: Juan, you agree with that?

WILLIAMS: Yes, I think that's possible. I think the administration, President Bush is very clear. He wants one, and again, he's got to fight Republicans, right wing on this.

KRISTOL: Well, he's done a lot of fighting of Republicans. To say to me that not only are the Democrats irresponsible, there are some irresponsible Republicans, that's not a good argument. That just increases my admiration for President Bush. He's also ruling over the irresponsible...

(CROSSTALK)

WILLIAMS: The majority of your own party is suddenly irresponsible because they disagree with you?

KRISTOL: Yes, absolutely.

BARNES: There was really an important thing that Mitch McConnell said when he was here. He's now the Republican leader. They have 49 votes, after all, and he said the minority can guarantee not much is done, which means that...

HUME: Which he said he's -- a proposal he said he's indisposed to take at this point.

BARNES: I know, but he said, you know, I've talked to him many times, and he's the great master of the filibuster, among other things. The president has great tools -- the veto, executive orders, recess appointments and so on.

I think the key thing here, Democrats can get things that Bush agrees with them on, like the minimum wage, but if he's against it like tax increases, they're just not going to succeed.

EASTON: Senator McConnell said something else important, which is that divided government has led to some pretty important legislation, like welfare reform.

HUME: Exactly.

EASTON: And I do think...

HUME: And you think Social Security is possible because of that?

EASTON: I think -- even though none of us have been able to figure out how they could possibly agree, there is clearly an impetus by this administration -- Hank Paulson, the treasury secretary, they want this legacy issue. I think this is going to be part of the president's State of the Union speech. They're going to continue to push on this. And I think it's on the table.

HUME: Bill?

KRISTOL: Bush's legacy is going to be winning the war in Iraq. It is not going to be on Social Security.

HUME: What do you think, any chance something can get done on Social Security?

WILLIAMS: Not unless you want to move on taxes. I mean, privatization is off the table for the Democrats. And so it's all about whether or not the administration is willing to allow an increase to some extent in taxes. And this is similar -- energy policy is another legacy issue, if the administration is willing to play ball. I think the Democrats very much want to cut subsidies to big oil and invest in renewable energy.

BARNES: Actually, the Bush administration is willing to play ball on that. I think there will be an energy bill that really expands the subsidies for alternative fuels. But on Social Security, zilch.

HUME: It's not going to happen. All right. Nancy Pelosi's first -- she emerged this week. We heard a lot from her, and a widely celebrated event. How did she do?

BARNES: I think she did fine. But it's going to be very tough to pass almost anything that Republicans and Bush don't want.

HUME: You agree with that?

EASTON: She did a good job of keeping both sides of her party happy.

HUME: Bill, what do you think of how she did the first week?

KRISTOL: She did fine.

HUME: Juan?

WILLIAMS: Love that idea of breaking the marble ceiling and all the grandkids. Gosh, what an image. Hollywood, come to Washington.

HUME: All right. Juan, Bill, Nina, Fred, thank you very much. We'll see you next week.

For more visit the FOX News Sunday web page.

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