Van Hollen, Pence; Lieberman; McDonnell on "Fox News Sunday"

Van Hollen, Pence; Lieberman; McDonnell on "Fox News Sunday"

By Fox News Sunday - November 8, 2009

WALLACE: I'm Chris Wallace and this is "Fox News Sunday."

Health care reform reaches a critical point in the House. We'll get the latest from two key congressman, Democrat Chris Van Hollen and Republican Mike Pence . Then, could anything have been done to stop an Army major from going on a deadly shooting spree at Fort Hood? We'll sit down with Joe Lieberman, chairman of the Senate Committee on Homeland Security.

Plus, Republicans win two important elections Tuesday. We'll ask Virginia's governor-elect, Bob McDonnell, about his strategy for a GOP revival.

Also, what does double-digit unemployment mean for the Obama agenda? We'll ask our Sunday panel -- Hume, Liasson, Kristol and Powers.

And our Power Player of the Week, from national scandal to a second chance, all right now on "Fox News Sunday."

And hello again from Fox News in Washington. We are following two major stories this Sunday. We'll get to the deadly massacre at Fort Hood in a few minutes.

But first, late Saturday night, the House approved its version of health care reform with just two votes to spare, by a margin of 220- 215. Fox News chief Washington correspondent Jim Angle has the story from Capitol Hill.


JIM ANGLE: Hello, Chris. Democratic leaders spent the last three days in furious behind-the-scenes negotiations because anti- abortion Democrats were threatening to vote against the bill, which would have killed it.

Speaker Nancy Pelosi knew she wouldn't get any Republican support, so she needed all 40 of the Democrats, who insist no federal money be spent on abortions. Bart Stupak of Michigan and Brad Ellsworth of Indiana, among others, refused to back down, so Ms. Pelosi had no choice but to allow a vote on their amendment to permanently prohibit any federal funds for abortion.


BART STUPAK: The speaker recognizes that members deserve the chance to vote their conscience and have their voices heard on this most important matter.


JIM ANGLE: But that angered abortion rights Democrats and risked losing their votes.


DIANE DEGETTE: To say that this amendment is a wolf in sheep's clothing would be the understatement of a lifetime.


JIM ANGLE: The anti-abortion amendment passed 240-194, with one member voting "present."

President Obama went to Capitol Hill Saturday in hopes of persuading any wavering Democrats, though Democratic leaders said he changed no minds. Republicans had a long list of objections.


JOHN BOEHNER: It's going to raise taxes. It's going to raise insurance premiums for those who have insurance. It's full of mandates and, not enough, we're going to cut Medicare.


JIM ANGLE: One member brought his chief of staff's 7-month-old baby to complain about costs.


JOHN SHADEGG: Maddy (ph) wants patient choice. Maddy doesn't want her mom's premiums to go up.


JIM ANGLE: Speaker Pelosi did not address the criticisms of new taxes but instead laid out the new benefits in the most glowing of terms.


PELOSI: No dropped coverage if you are sick. No co-pays for preventive care. There's a cap on what you pay in, but there is no cap on the benefits that you receive.


JIM ANGLE: Democrats won the day, though just barely, losing 39 Democratic votes but winning one Republican.

Now the action shifts to the Senate where a single bill has yet to emerge from Majority Leader Harry Reid . It's clear any Senate bill will differ substantially from the House, which means the two bodies will have to get together and try to shape a bill both houses can embrace.


WALLACE: Jim Angle reporting from the Capitol.

Jim, thanks for that.

Joining us now to discuss the battle over health care reform and to look ahead to the 2010 elections are two top members of the house, Democrat Chris Van Hollen , who is running his party's campaign for the next Congress, and Republican Mike Pence , the GOP's number three man in the House.

And, Congressmen, welcome back to "Fox News Sunday."

VAN HOLLEN: Thanks, Chris.

PENCE: Good to be with you.

WALLACE: Congressman Van Hollen, what's the message from the vote last night? The House, for the first time in history, passing a major overhaul of health care reform, but with only one Republican voting for it and 39 Democrats voting against it?

VAN HOLLEN: Well, the message was clear. It's time to begin to fix what has been a broken health care system for millions of Americans. Between the year 2000 and 2008, we saw premiums double for Americans during that period of time.

Insurance company profits were over 400 percent. So we've had a great system for insurance companies. They get to say no to you based on your pre-existing condition. They get to dig into the fine print of your insurance policy when you need it the most and say you're not covered. They've enjoyed an antitrust exemption that we eliminated.

So this is a message to the American people. It's time to bring down your costs, which will allow more people to afford health insurance.

WALLACE: Congressman Pence, what's the message from last night? And what about those Democrats from conservative districts who ended up voting for the bill? Are you going to make them pay in the next election?

PENCE: Well, Chris, I think the message from last night is that the Democrats didn't get the message in August or last Tuesday.

I think from this past summer we saw the American people express overwhelming opposition to a government takeover of health care. They attended town hall meetings, rallies across the country, and then this last Tuesday.

I mean, the historic reversals that Democrats saw in just 12 months in New Jersey and Virginia, again, was an effort by the American people to send a message to this party that they're tired of the borrowing, the spending, the bailouts, the takeovers.

But last night on a narrow partisan vote the Democrats put their liberal, big government agenda ahead of the American people.

WALLACE: So are you going to go after those conservative Democrats, moderate Democrats, in Republican-leaning districts who voted for this bill?

PENCE: Well, look. I don't -- I don't know if it's about -- I think the American people are deeply frustrated with a liberal establishment in Washington, D.C. that is ignoring their will.

Nancy Pelosi last night said that they were answering the call of history. Well, I -- I've got to tell you, if Democrats keep ignoring the American people, their party's going to be history in about a year.

WALLACE: Congressman Van Hollen, I'd like you, first of all, to respond to that, but also -- yes, you did pass a bill, but the Senate is considering a very different bill, with a very different public option, and very different taxes -- a number of measures.

So how much have you really moved the process forward?

VAN HOLLEN: Well, first, just in response, the message from the last election was loud and clear. The American people were tired of us pushing big issues under the rug, not dealing with the major challenges...

WALLACE: You're talking about 2008 or 2009?

VAN HOLLEN: I'm talking about 2008 election, the 2008 elections, when President Obama and the larger majority went into Congress. You know, with all due respect to Mike and his party, when President Bush -- and they had a lock on the Congress.

They did nothing about these issues, these rising costs, the fact that insurance companies could essentially abuse consumers. They did nothing about it.

And people back in 2008 said it's time to step up on some of these issues. And that's what we did last night.

And I would point out that in terms of the elections last Tuesday, there were only two races in the country where what we're doing in Congress at the federal level was at the center of debate, and those were the two congressional races. Both members of Congress won. Both of them voted yes last night on health care reform, so...

WALLACE: How about this question of the Senate, though, the fact that the Senate bill is a very different bill, very different on the public option, very different on the taxes to pay for all this?

VAN HOLLEN: Well, as you well know, this is just one step, a very big step, on a long journey. And we're going to have to work with whatever the Senate comes up with to reconcile the differences, and we will.

I know the Senate's committed to moving ahead and we will put the pieces together. As you know, Harry Reid on the Senate also proposed a public option as part of the bill he intends to bring to the Senate floor -- again, a voluntary option to try and hold insurance companies accountable.

I would point out that Consumers Union and Consumers Reports, those reports that everybody looks at -- they endorsed this bill because they understand it will provide more...

PENCE: Chris, if I could -- Chris...

WALLACE: Let me just ask you... PENCE: But I think this really illustrates the fact that Democrats didn't get the message. Republicans -- I mean, let's be honest here. You know I fought against members of my own party in these battles.

Republicans doubled the national debt in the first six years of this decade, and the American people showed them the door in 2006 and again in 2008.

But the Democrats took runaway federal spending under Republican control and put it on steroids, and the American people are tired of the borrowing, the spending, the bailouts, the takeovers.

And I think -- you know, I appreciate Chris pointing out the congressional elections, but the truth is a Republican running on a third party ballot almost beat the Democratic candidate in New York.

And when you look at New Jersey, the president won New Jersey by 16 percent 12 months ago. He won Virginia by 7 percent 12 months ago. Republicans won in a landslide in Virginia, won narrowly in New Jersey.

Now, I'll stipulate, Chris, that all politics is local. People are voting on local issues in those races. But every single one of those voters were also Americans who were responding to the profound frustration...

WALLACE: Let -- let me...

PENCE: ... the American people feel with the liberal...

WALLACE: Let me...

PENCE: ... establishment in Washington.

WALLACE: Let me as you about another factor in all of this, and that is we learned on Friday that unemployment is now 10.2 percent -- almost 16 million Americans unemployed.

Let me start with you, Congressman Van Hollen. Can we afford a trillion-dollar health care reform bill with billions of dollars in new taxes and new mandates for small business when we've got 10.2 percent unemployment?

VAN HOLLEN: Well, let me first point out, in response to both what Mike said and your question, that the Congressional Budget Office, the nonpartisan Congressional Budget Office, who we've all been looking to for the numbers, looked at the bill that passed the House and said it reduces the deficit over a 10-year period by more than $100 billion.

In fact, it reduces the deficit over that period of time more than the alternative that the Republicans put on the floor, and also reduces the deficit over the following 10-year period.

When it comes to health care and economics, one of the things we've got to do is make sure that we reduce the costs of health care. They're eating businesses and individuals and families alive. And so for our own economic competitiveness, we've got to address this issue.

Now, with respect to the economy, when President Obama was sworn in, as we all know, the economy was in total collapse, free fall. Seven hundred thousand people lost their jobs in January. Last month we saw about 150,000 people lose their jobs. Unacceptable.

We need to get the economy going forward again, but we did see positive economic growth last quarter, 3.5 percent, for the first time in a long time.

WALLACE: But -- but -- but Let me, Congressman Pence -- hundreds of billions of dollars in new taxes, new mandates on small business -- is that what you want when you've got 10.2 percent unemployment?

PENCE: Well, the truth is, you know, when you're in a hole, Chris, first rule is stop digging. Chris is absolutely right. The economy was in shambles when this president came to power.

They passed a so-called stimulus bill that was nothing more than a liberal wish list of spending priorities that has now taken us from 7.5 percent unemployment to a heartbreaking 10.2 percent unemployment nationally.

But they're -- the Democrats in Washington are still, again, ignoring the American people. They're unwilling to reconsider this approach. They think we can borrow and spend and bail our way back to a growing economy.

But on top of this, they drop a massive national energy tax they passed along party lines. But to your point, $729 billion in tax increases -- Congressman Boren, one of his Democrat colleagues, said, quite, "The last thing you do in a recession is raise taxes and that's just what this health care bill does." It was the wrong thing to do and the American people know it.

WALLACE: Gentlemen, we're going to have to cut it off there. I want to thank you both for coming in, Congressman Van Hollen, Congressman Pence. Thanks for coming in. It was a long day and night on the House floor, and there's going to be lots more to debate as this process continues forward. Please come back, both of you gentlemen.

PENCE: Thanks, Chris.

VAN HOLLEN: Thank you.

WALLACE: Now to our other top story, that terrible shooting spree at Fort Hood Thursday. There are still more questions than answers about the worst attack ever at a U.S. military base.

Did the gunman, Army Major Nidal Hasan, work alone? What was his motive? And should the tragedy have been prevented? For answers we turn to Joe Lieberman, chairman of the Senate Homeland Security Committee. And, Senator Lieberman, welcome back, sir.

LIEBERMAN: Chris, good to be with you.

WALLACE: In the briefings that you and your staff have received, have you learned any more about Major Hasan's motives, his actions, and whether or not that he had any links to Islamic radicals overseas?

LIEBERMAN: It's -- first, this was a terrible tragedy. Second, it's too early -- it's premature to reach conclusions about what motivated Hasan. But it's clear that he was, one, under personal stress and, two, if the reports that we're receiving of various statements he made, acts he took, are valid, he had turned to Islamist extremism.

And therefore, if that is true, the murder of these 13 people was a terrorist act and, in fact, it was the most destructive terrorist act to be committed on American soil since 9/11.

But I want to say very quickly we don't know enough to say now, but there are very, very strong warning signs here that Dr. Hasan had become an Islamist extremist and, therefore, that this was a terrorist act.

WALLACE: I'm going to pursue that in a second. But any evidence so far that what you or your staff have heard in briefings that he -- because we know he was on some radical Islamic Web sites...

LIEBERMAN: Right, right.

WALLACE: ... that he was exchanging communications either in this country or overseas with other Islamic radicals?

LIEBERMAN: Yeah. Nothing I can confirm at this point. I think it's very important to let the Army and the FBI go forward with this investigation before we reach any conclusions.

But what we do know on the record from third parties reporting over the last two or three years -- that he made a series of statements justifying suicide bombing, comparing it to the bravery of an American soldier who would throw himself on a grenade to protect his colleagues, that he said that -- well, he shouted out, according to bystanders at that -- while killing the other day at Fort Hood, the words Allah Akbar, an expression of faith in Islam which the Islamist extremists have corrupted.

And the fact that he did that at the moment of these murders -- if that's confirmed, of course -- raises genuine concerns that this was a terrorist act.

I will add to this, Chris, this is not the first attempt by Islamist extremists to strike at American military bases. We've broken up plots to go after Fort Dix, Quantico Marine base in Virginia.

In fact, the one successful, if I can put it that way, terrorist act that was done in recent years was the individual in Little Rock, Arkansas who walked into an Army recruiting station and killed a recruiter.

And there is testimony that Dr. Hasan actually said that he understood that and supported that act.

WALLACE: A lot of people are wondering -- you talk about all the statements he made. There were a lot of warning signs out there. I know hindsight is 20/20, but were there enough signs that -- enough red flags that authorities should have stepped in?

LIEBERMAN: Well, that's a very important question. And I would say, Chris, that while the Army and the FBI are conducting the criminal investigation about exactly what happened and what Dr. Hasan should be charged with, the U.S. Army -- the Department of Defense has a real obligation to convene an independent investigation to go back and look at whether warning signs were missed, both of his -- the stress he was under, but also the statements that he was making which really could lead people to believe that Dr. Hasan had become an Islamist extremist.

A couple of years ago, after a two-year investigation, my committee put out a report that said the new face of terrorism in America would not just be the attacks as 9/11, organized abroad and sending people in here. It would be people within this country, home- grown terrorists, self-radicalized, often over the Internet, going to jihadist Web sites.

And there's concern from what we know now about Hasan that, in fact, that's exactly what he was, a self-radicalized home-grown terrorist.

WALLACE: I've got a couple of questions I want to get in, so...

LIEBERMAN: Please. Go ahead.

WALLACE: As chairman of the Senate Homeland Security Committee, do you intend -- with all these questions out there, do you intend to hold hearings?

LIEBERMAN: I intend, working with my Republican ranking member Susan Collins , to begin an investigation. I think the first steps that should be taken in this regard should be taken by the U.S. Army, because this was an attack on American troops. You've got to see it as if 12 American troops were killed in Afghanistan.

WALLACE: But you're intending to hold your own congressional...

LIEBERMAN: I am intending to begin a congressional investigation of my Homeland Security Committee into what were the motives, what were the motives of Hasan in carrying out this brutal mass murder, if a terrorist attack, the worst terrorist attack since 9/11, and to ask whether the Army missed warning signs that should have led them to essentially discharge him.

Really, in the U.S. Army, this is not a matter of constitutional freedom of speech. If Hasan was showing signs, saying to people that he had become an Islamist extremist, the U.S. Army has to have zero tolerance. He should have been gone.

WALLACE: Finally -- we have less than a minute left -- the House passed health care. What do you think of the bill they passed? And do you still intend, if there is a public option and if there's this tax on so-called Cadillac health plans...


WALLACE: ... will you support a Republican filibuster on final passage in the Senate?

LIEBERMAN: Well, there's some good things in the House-passed plan. You know, I'm -- I think we ought to do health care reform this year to deal with the two great problems that President Obama and others have talked about.

There are unsustainable continuing increases in the cost of health care. We've got to -- we've got to stop that. And there are millions of Americans who don't have health insurance.

But I'm afraid our colleagues in the House added a lot onto that that subtract from the genuine purposes of health care reform, and one was to create a public option plan.

The public option plan is unnecessary. It has been put forward, I'm convinced, by people who really want the government to take over all of health insurance. They've got a right to do that. I think that would be wrong.

But worse than that, we have a problem even greater than the health insurance problems, and that is a debt -- $12 trillion today, projected to be $21 trillion in 10 years.

WALLACE: So at this point, I take it, you're a "no" vote in the Senate.

LIEBERMAN: If the public option plan is in there, as a matter of conscience, I will not allow this bill to come to a final vote, because I believe the debt can break America and send us into a recession that's worse than the one we're fighting our way out of today. I don't want to do that to our -- to our children and grandchildren.

WALLACE: Senator Lieberman, thank you. Thanks for coming in today and joining us.

LIEBERMAN: Thank you, Chris.

WALLACE: And we'll be following your congressional investigation, sir.


WALLACE: Up next, Republicans win governors' races in Virginia and New Jersey. In Virginia, Governor-elect Bob McDonnell talks about his ideas for a GOP revival, right after this break.


WALLACE: This week the result of the Virginia governor's race was striking. Last November Barack Obama became the first Democrat to carry the state for president in 44 years. But Tuesday Republican Bob McDonnell took back Virginia for the GOP in a landslide. The governor-elect joins us now from his alma mater of Notre Dame.

Congratulations on the election, if not on yesterday's football game, sir, and welcome back to "Fox News Sunday."

MCDONNELL: Well, thanks, Chris. It was a great week for us. We're very honored, and nice to be back on with you.

WALLACE: After your landslide victory on Tuesday, a number of top Republicans across the country say that your election campaign is a model for how Republicans can and should run in 2010 and 2012.

What parts of your campaign do you think can be replicated across the country?

MCDONNELL: It's very flattering people would say that. We tried to focus on the issues we knew people cared about. It was jobs, the economy, economic development, transportation, the things that the citizens overwhelmingly said they wanted government to fix.

Secondly, we kept it overwhelmingly positive, giving people an uplifting alternative for the future. And thirdly, we, I think, tapped into some of the sentiment at the national level on the issues of card check, cap and trade, and some under-funded mandates and things like that that were not resonating well with Virginia businesses and families.

And together with a lot of hard work, I think it was a winning strategy.

WALLACE: So what do you think there is a message, if there is a larger message, for Republicans looking to get healthy again in 2010?

MCDONNELL: Stick to your conservative principles but focus on the quality-of-life issues that the citizens are most concerned about, and focus on getting results.

People see that there's this massive spending at the federal level, at the state level. They want a better bang for their buck out of government. And fiscal conservatism is the way to deliver that -- is the way to deliver that message.

WALLACE: I want to run a clip from the news conference you held the day after your election. Let's take a look.


MCDONNELL: I just want everybody in Virginia to know that I intend to govern the same way I campaigned.


WALLACE: Governor-elect McDonnell, experts say that while you obviously have a long record as a social conservative, you largely stayed away from that and, as you say, campaigned primarily on kitchen-table issues like education, like jobs, like transportation.

Is that what you mean when you say that you're going to govern the way you campaigned?

MCDONNELL: It's going to mean that I'm going to put the priorities that I outlined during the course of the campaign as the first order of business.

With our high unemployment rate and our budget deficits, the fiscal issues, Chris, have got to be the first order of business.

But I was completely clear during the campaign that I -- I am pro-life, I am pro-family, and I'm going to support those issues in the general assembly. But I'm going to focus on getting results on those campaign promises. I think that's the way you keep trust with the people.

WALLACE: But one of the issues in other races, especially that congressional race in upstate New York, was conservative activists, especially social conservatives and tea party activists, saying they want attention paid to their issues.

How do you balance their concerns with the concerns of a lot more moderate voters who just want to focus on jobs?

MCDONNELL: Well, I ran very specifically on the fact that I'm going to make government work better. We're going to find ways to cut spending out of state agencies and retool government to find ways to keep taxes low, whether it's -- and when the economy returns, find ways to reduce the tax burden on working families, use tax cuts as a way to promote economic development.

These are clearly things that my friends in the -- my conservative friends and I are very interested in doing, and then to make sure that these important issues are protecting families, promoting fatherhood, looking for options in education, like charter schools and merit pay.

These are things that I ran on as part of the overwhelming -- the overarching theme of the campaign, and I intend to pursue those as well. So I think that the overwhelming conservative message with a focus on practical results is exactly what people have elected me to do.

WALLACE: But let me ask you about some of the issues that some of the right-wing activists are now saying they want you to focus on. One, will you move to make Planned Parenthood ineligible for state funds?

MCDONNELL: I've said that state policy ought to be the same as the Hyde Amendment. In fact, in the federal health care bill last night, as you see, both Democrats and Republicans joined to make sure that there was not federal funding for abortion services in the health care bill.

I think that's the right policy. Across the board, people don't want taxpayer funding to go for those kinds of services. And so I think that ought to be the state policy as well.

WALLACE: Will you work to expand Virginia's death penalty to not only the person who pulls the trigger but also to anyone involved in a murder?

MCDONNELL: Yes. I've supported that from my early days as a prosecutor through the general assembly. Those bills have gotten to the governor's desk the last couple of years and been vetoed, and I'll sign that bill.

WALLACE: Let's talk about a few national issues. As you well know, the U.S. House late last night passed a major overhaul of health care reform.


WALLACE: If that bill as it was passed by the House should become law, what do you think that would do to the nation's economy and to the nation's health care?

MCDONNELL: I'm very concerned about the bill -- 1,900 pages, 3,400 uses of the word "shall." There are clearly great mandates on businesses, families and the states.

Now, I have not read all 1,900 pages of it, but I think that with about a $1.2 trillion price tag, tax increases, $400 billion or so taken from Medicare, that it will ultimately increase costs and reduce choices for families.

Across Virginia, Chris, I heard people's concern about that. And we're obviously going to have to see the way it passes, what the Senate does with it, before I can give you a final opinion. But I'm very concerned about what I -- what I saw in that bill.


WALLACE: There's been quite a debate about what Tuesday's elections, not only in Virginia but across the country, meant. Do you think that voters were sending President Obama, if only directly, a message?

MCDONNELL: I'm going to leave that up to a lot of other experts to decide. I will say this. I ran on Virginia issues, the kitchen- table issues that were based on our conservative principles, and I think that's largely what got people to support our campaign.

A lot of independent voters, though, and Republicans as well, clearly told me that they were very concerned about the direction of the country, the spending, the taxes, card check, cap and trade, unfunded mandates, intrusions into the free enterprise system.

And I think that's, in part, why some of the folks came back and voted for me this time. I made cap and trade in particular an issue.

So the answer is yes, I think, in part, Virginians said, "We're concerned about what's going on at the federal level, we like your fiscal conservative message in Virginia on taxes and spending, and that's why we're voting for you."

WALLACE: I'm going to turn subjects on you now. It sounds silly to bring up less than a week after your election, but some political junkies here in Washington, some very powerful ones, are already saying that you will be on the short list of vice presidential candidates come 2012 for the Republican Party.

Do you harbor any national ambitions, sir?

MCDONNELL: No, I really don't. I mean, I love Virginia. I've served in the state government now for 18 years. I've got a very ambitious set of policy initiatives, Chris, that I'd like to get accomplished.

It's very flattering to hear people talk in those terms, but I really -- I'm going to focus 100 percent of my time on Virginia. We have a great state, but we've got some challenges. I've committed to fixing some of those problems, and I'm going to get right to work on that this week.

WALLACE: Well, Governor-elect, you can put all of that chatter to rest right here, so let me be the very first one to ask you. Will you promise to serve a whole full four-year term into 2014?

MCDONNELL: Yeah. I've said that I would. I mean, other governors have looked at those kinds of things in the future. But I don't have any aspirations beyond being governor of Virginia at this point.

WALLACE: So four full years.

MCDONNELL: That's my pledge.

WALLACE: Governor-elect McDonnell, we want to thank you so much. Congratulations again. Thanks for joining us, and good luck in your new job.

MCDONNELL: Thank you, Chris. Great to be back on with you. I appreciate it.

WALLACE: Thank you.

Up next, last night's historic vote in the House on health care reform -- we'll talk with our Sunday panel about the Democrats' big victory and what it may cost them. Back in a moment.



ROBERT ANDREWS: It has been said that this is a government takeover of health care. That is false. This is a consumer takeover of health care.



LOUIE GOHMERT: This is a declaration of dependence that pledges Americans' lives, Americans' fortunes, and there is no honor in that.


WALLACE: Just a taste of the debate that took place Saturday before the House's historic passage of health care reform.

And it's time now for our Sunday group -- Brit Hume, Fox News senior political analyst, and contributors Mara Liasson of National Public Radio, Bill Kristol of The Weekly Standard, and Kirsten Powers of the New York Post.

So after the House vote last night passing health care reform, Brit, where are we now?

HUME: Well, 18 House Democrats from districts carried by John McCain voted for this measure. I would say some of them were from safe seats even though they were carried by McCain, but a lot of them weren't.

And they are, as of this morning, I think it's fair to say, vulnerable in the upcoming election. Everything will depend, though, Chris -- everything will depend -- on the economy. If the economy improves, those people may be all right.

As for the health care measure itself, it still has a very long way to go. As you pointed out in earlier segments, what is being worked on in the Senate is quite different, markedly different in some ways, and may not pass the Senate.

So those votes cast over there by those people in those districts may end up going to waste, much as their votes on cap and trade are likely to end up going to waste. WALLACE: Mara, where do you think we are in terms of the whole process of either getting or not getting health care reform?

LIASSON: I think we're one step closer to getting it. I mean, this thing has moved forward step by difficult step.

I think what's interesting is that every step of the way, it has gotten slightly more centrist. What Nancy Pelosi had to do to get the votes -- and she lost 39 Democrats. She had to move the bill to the center on the public option and, in the final fight, on abortion, because I think in the end -- and you saw this on the vote in the House -- that liberals held their nose, voted for the bill.

They'll do that in the end because there is no liberal in Congress who would lose their seat if the abortion language that passed last night is in the final bill or if a public -- vigorous public option isn't.

But it's also true that some conservative Democrats could lose their seats if the public option was in it or if the abortion language wasn't. So I think that is the dynamic now. It's moving slowly forward and it's getting more centrist.

WALLACE: Bill, you've been nothing if consistent on this. You have doubted all along that any major health care overhaul is going to get passed. Did the vote in the House yesterday change your mind?

KRISTOL: No. I would say the vote in the House -- if you had said six months ago this bill would not pass until just before Thanksgiving and would have -- lose 39 Democrats, and the Senate would now have to deal with a bill that passed the House on a purely partisan vote with 220 votes, I think people would say, "Gee, it was supposed to pass by a lot more than that, and it was supposed to put all this pressure on Republicans resisting health care reform."

The opposite is the case. The Senate will not pass this bill. Nancy Pelosi has now pushed through -- I give her credit for this. She has been -- for what she wanted to do, she has been an effective speaker. Republicans should not underestimate her.

But she has now pushed through cap and trade with 219 votes and a massive Medicare-cutting, tax-hiking, premium-reducing so-called health care reform bill with 220 votes, neither of which is going to pass the Senate.

So I don't think either passes the Senate, and I think she's done a lot of damage to her own members in the House.

WALLACE: Let's talk about that -- and Brit brought it up, Kirsten -- which is the possible cost of this victory for Democrats. Forty-nine so-called McCain Democrats, Democrats who were elected in districts last year, congressional districts, that also voted for John McCain -- when you consider Tuesday's election, which I think is seen as generally positive for Republicans, when you consider the news on Friday about 10.2 percent unemployment, how much of a problem is health care and cap and trade and the rest of the Obama agenda for these conservative to moderate Democrats?

POWERS: Well, I mean, there are also eight "nos" in districts that Obama won but barely. So that shows that people are concerned about that, but I think ultimately it's going to rise and fall on what Barack Obama does in the next -- you know, next year, essentially.

If you look at -- is he going to be a Clinton or is he going to be a Reagan? And you know, you had -- you had Reagan with a very clear vision. You had people feeling that he was somebody that he could trust -- they could trust and move in that direction with him.

And I think that one of the things Obama is facing right now is really convincing people that "I have a big vision for the country, get on board with me, remember, you didn't like it the way they used to do it, and stick with me because I have a plan."

And instead he's been playing kind of small ball. And if it wins, if he passes health care...

WALLACE: You think it's small ball even with health care reform?

POWERS: I think -- I think on the day-to-day stuff it's been a lot of small ball, and I think health care has been a distraction from things that most Americans are really focusing on, such as the economy and jobs.

But I do think -- I think it's actually going to end up passing. And I -- if it passes, then America -- you know, success begets success in politics. And so if it passes, he's going to have a big win under his belt. And then I think it's just basically saying, "Stick with me, I have a vision," you know, "Don't change mid-course."

HUME: Chris, remember this about this bill if it passes. This is not the country's top priority.

Now, the discussion about it has elevated to some extent and made it a higher priority than it was as Obama took office. The overwhelming priority in this country today -- and it's going to continue all through next year -- is the economy.

All the president, though, has done on the economy is the stimulus bill, which by the time it passed was notorious for its waste. And now, as unemployment continues to climb, it is notorious for its ineffectiveness to date.

You put those two things together, and he adds to it now this very costly health insurance reform program, which is going to burden business and will burden the economy. I think it is a formula for even greater trouble for the Democrats if it passes than if it doesn't.

LIASSON: I actually think that the president's determined to be Reagan, not Clinton, and I think you're going to see them pivoting right after this health care bill passes to the economy, the economy, the economy. Next year you're not going to hear them talk about anything else but jobs and the economy. And I think their hope is to get -- the first things that are going to happen to American people because of the health care bill are hopefully going to be the good things, not the bad things.

WALLACE: But you know, you keep on talking about Reagan. I covered Ronald Reagan in 1982 when unemployment was last at 10 percent-plus. It was politically toxic. The fact is that he in the ‘82 elections lost 26 seats in the House.

So I mean, it was interesting, Chris van Hollen, Bill, in the first segment, you know, was making the old argument, "Well, we inherited a mess and we're turning things around." If unemployment -- and by all accounts it's going to be 10, 10.5 percent into next summer. Isn't that an awfully heavy burden for Democrats going into a congressional election?

KRISTOL: I mean, Reagan in ‘82 held the Senate and half the 26 seats he lost were because of reapportionment, so he did better than you might have expected given that unemployment was above 10 percent. Why? He had bipartisan support for his tax cuts and his defense buildup, and people had confidence he was going in the right direction.

This health care bill burdens the economy. That is going to be the core argument next year. And it is going to be next year. This bill's not going to pass before Christmas. There's no, "Well, we're going to pivot." I mean, the Obama White House thinks it's all talk. "We're going to pivot from health care to talking about the economy."

They can pivot all they want. Unemployment is going up. The economic rebound, I think, is going to -- is going to sag, and we're going to have health care and cap and trade as the two great Democratic pieces of legislation, both of which burden the economy.

WALLACE: All right. We have to take a break here.

But when we come back, we'll continue the discussion about health care, unemployment and the election. And we'll ask the question: Did political correctness play a role in the mass killing at Fort Hood? Stay tuned.


WALLACE: On this day in 1994, the Republican Party won control of both the House and Senate for the first time in 40 years. Led by Newt Gingrich, Republicans held onto both houses of Congress through 2006.

Stay tuned for more from our panel and our Power Player of the Week.


WALLACE: And we're back now with our panel.

And I've got to tell you for the entire time that you were away, we were away and you were watching commercials, the gang here was all arguing.

And I'm going to just continue the conversation, Kirsten. Is there something -- if we're looking at a pretty bleak picture on unemployment well into 2010, double-digit unemployment, is there something beyond just talking about it when the president says or the White House says they're going to pivot to the economy -- is there anything they can do?

POWERS: Well, they can do, you know, what he talked about during the election, doing tax credits, doing things focused on the middle class.

I mean, most of his tax hikes go towards millionaires, you know, high-end people, which is exactly what he said. But I do think that, you know, this has become kind of a broken record.

But unemployment is a lagging indicator, and I think that it's the last thing that will turn around. And we don't know when it's going to turn around.

You were referencing midterm elections with Reagan. I mean, right before the midterm elections, unemployment was at its highest. And there's nothing to say that it's not going to continue to go a little bit higher before it goes down again.

And I think -- that's why I think the vision, the speaking to Americans, saying, "Here's my vision, stick with me, this is -- this is the -- this is the train you want to be on," is what he's got to do.

WALLACE: Bill, you were the only person I know who thought that losing 26 seats in the House in 1982 was good for the Republicans. I mean, I remember the message was stay the course. The American people didn't buy it.

Can he substantively and politically turn around the unemployment picture, Obama?

KRISTOL: Most economists would be doubtful that anything much that gets passed next year is going to change unemployment in 2010.

He's given us his priorities. This notion which I think some people have in Washington that you just magically, as president, show up and say, "Oh, forget about that health care bill, that cap and trade. You know, those things were like last year. Now I'm doing tax credits to encourage business investment."

It will be farcical. He has staked himself on the stimulus, health care, cap and trade, three huge pieces of legislation jammed through on -- with partisan votes in the House of Representatives by President Obama and Speaker Pelosi.

If those -- if he's not willing to go to the country and defend those in October of 2010 he's in deep trouble.

LIASSON: Right, and...

WALLACE: Let me -- let me turn, if I can, because we're going to run out of time, to the terrible events at Fort Hood this week.

Brit, you heard Senator Lieberman earlier. Was the massacre by Army Major Hasan an act of Islamic terrorism?

HUME: It certainly looks like that. Senator Lieberman was absolutely right. Now, it may -- we may learn more about this man and it'll turn out that he snapped and it was all an emotional disturbance that caused this.

But on the face of it, when you consider what we know about what he'd been saying and apparently thinking about the -- about the American enterprises overseas, the two wars and the approach toward Islam, this -- it looks like this guy was alienated by that, became more intentionally Islamist as time went on.

And if it turns out to be true that he's screaming Allah Akbar as he starts massacring people, that's an act of terror, no doubt about it...

WALLACE: So why the reluctance...

HUME: ... an act of Islamist terrorism.

WALLACE: ... why the reluctance to call it that? Is it because we don't have all the facts? Or is something else going on here?

HUME: Well, I think it's -- well, first of all, if the -- if it became clear that the Army had in its midst someone who was looking and acting like someone with these tendencies, and they did as little as they did about it, that's a much greater embarrassment.

I mean, for the Army -- what the Army needs, having done so little to deal with this man, is for it to come out that he's just some guy who just snapped. But that isn't how it looks right now, and if it continues that way, the Army has a lot of explaining to do.

But I think that's the source of this effort to be so -- to pussyfoot around what appears to be the likely reason here.


LIASSON: Look, we don't have all the facts, and it could be that he snapped and also was someone who expressed sympathy for suicide bombers and -- you know, if he, in fact, wrote on these Web sites the things that he's alleged to do.

Now, that's quite different than saying this was part of some kind of a planned terrorist attack. We don't know if he worked with anybody else. It sounds like so far we think he acted alone.

But I don't think -- it's clear that the Army missed some red flags, but the question is going to be why. Many big institutions miss red flags, not because they bent over backwards to ignore them.

WALLACE: Well, let me ask you about that, Bill, because obviously everybody agrees there were a lot of alarm bells that went off. Major Hasan was not keeping quiet his opposition to the U.S. foreign policy, calling the war on terror a war on Islam.

Of course, the fact that it seems -- we don't know for sure, but someone named Nidal Hasan was posting messages sympathetic to suicide bombings on radical Web sites.

Some conservatives are now making the argument that what's -- that the reason they missed these was that the Army was involved in political correctness. Do you believe that?

KRISTOL: The Associated Press, not a conservative news organization, is reporting that at Walter Reed, fellow medical officers of Hasan who heard him say these things -- I'm going to quote the Associated Press, "A fear of appearing discriminatory against a Muslim student kept officers from filing a formal complaint." That's the Associated Press reporting, presumably, on officers they have spoken to there.

So I think it's not a theory. It's a fact. Maybe they should have -- obviously, they now wish, I'm sure -- these officers -- they had filed a formal complaint.

And General -- so yes, political correctness, I believe, in the Army was partly responsible for keeping this man in the military when anyone else who had done this kind of thing that didn't have a Muslim patina -- if someone had just screamed, "I hate the military, I want to kill the military, I'm on neo-Nazi Web sites," he would have been disciplined and kicked out, I believe.

And secondly, General Casey, the chief of staff of the Army, said Friday, "You know what we needed to look at? Greater force protection measures at our bases." That's the Army's response, that we're going to -- soldiers have to be protected against other soldiers picking up -- going out, buying extremely lethal weapons and killing their fellow soldiers?

So I am very worried, and I welcome -- I think we need to have an investigation. We shouldn't pre-judge. These things are hard to do. I don't want to sit here and second-guess everyone in the chain of command. But something went very wrong and it needs to be looked at with honest -- honestly, not politically correctly.

WALLACE: Kirsten?

POWERS: Well, I think, you know, he was a Muslim and he did something horrific. He -- I think it's more that he probably snapped. Was there political correctness? That's a separate issue of whether this was an act of Islamic terror, in my opinion.

It's kind of like saying a person who goes to a right-wing Christian church who goes -- then goes to an abortion clinic and kills somebody, then we should extrapolate from that that Christians do something.

There's about 1,000 Muslims in the military. I don't think because one Muslim person does something who was clearly unstable that you can necessarily extrapolate that that's Islamic terror.

HUME: Extrapolate what?

POWERS: Just that -- what a lot of conservatives are saying, that this is an act of Islamic terror.

HUME: Well, why...

WALLACE: You know what? Keep that thought. Guys, you're going to want to go to our Web site to check out our "Panel Plus." Thank you, panel. See you next week.

And don't, as we say, forget to check out the latest edition of "Panel Plus" where our group here continues the discussion on our Web site shortly after the show ends. In addition, you can send us your comments there as well.

Up next, our Power Player of the Week.


WALLACE: You won't recognize him and you may not remember his name. But back in 2003, he was at the center of a national scandal. Here's our Power Player of the Week.


BLAIR: I know I'm telling the truth to the best of my ability and my knowledge. But it's really up for people to take that information that I offer and come to answers for themselves.

WALLACE: Jayson Blair, talking about the truth, the central issue in his life. Six years ago he resigned as a reporter for the New York Times after it was revealed he had plagiarized or simply made up facts in dozens of stories.

The scandal brought down the paper's top two editors and shook the nation's media.

BLAIR: I think that most people initially, when they hear the idea of me being a life coach, they kind of laugh at the notion, but when they think about it and they think -- and they -- if they can buy into the idea that I did actually learn and grow from my experience, it makes perfect sense.

WALLACE: We caught up with Blair this week at a small psychological counseling business in Virginia where he now works.

Having spent years in treatment for bipolar disorder, manic depression, as well as alcohol and drug abuse, he now teams up with health professionals to counsel people in crisis.


BLAIR: What are dad's prospective roles, mom's prospective roles, and what are the things that the girl wants?


WALLACE: Blair says at age 33 he's turned his life around...


BLAIR: I was hesitant about reopening an old wound of mine.


WALLACE: ... and can now give people the benefit of his terrible experience.

BLAIR: If I wasn't the youngest reporter, I was the second youngest reporter in the building. I think I was.

WALLACE: Fair to say that you were on the fast track?

BLAIR: Yes. Yeah. I think it certainly is fair to say.

WALLACE: Blair joined the Times in 1999. He says he started out wanting to help people but eventually convinced himself that meant he had to be a star.

When did you start lying?

BLAIR: That's a really good question.

WALLACE: Blair says he got a quote from someone he knew was giving him a fake name. He put it in the story anyway.

BLAIR: Once I had crossed that ethical line, like so many ethical lines, it was so much easier to jump across.

WALLACE: By the end, Blair was supposedly writing stories from around the country without ever actually leaving his New York apartment. BLAIR: At its core, to me, you know, it's theft and it's lying and it's, you know, conniving behavior.

WALLACE: While Blair now says he was suffering from undiagnosed mental illness, he refuses to use that as an excuse.

BLAIR: Ultimately, all of that stuff aside, the one thing that I can say for sure played a role in it happening was my character, that there was a problem with who I was.

WALLACE: How do you feel about where you are today?

BLAIR: I feel good. The medications don't work all the time, so there are periods where, you know, I am sick briefly for a while or I am feeling down. So it is hard. It's hard to do. It's difficult to do.

But I feel much better about it than I felt about my life two, three, five or even 10 years ago.


WALLACE: Friday night Jayson Blair spoke to journalism students at Washington and Lee University, and he told them the big ethical decisions in life don't come with trumpets blaring but in small daily choices about what compromises you're willing to make.

You can see more of the interview at

And that's it for today. Have a great week and we'll see you next "Fox News Sunday."


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