(Source: NBC’s Meet the Press)
MR. DAVID GREGORY: Our issues this Sunday: the transition ceremonies are under way, and in just two days the historic inauguration of Barack Obama as our nation’s 44th president. He’ll inherit a country in economic turmoil, an ongoing multifront war on terror and renewed violence in the Middle East. What will be his first priority? And is he already facing his first fight on the Hill, as Democrats and Republicans clash over a proposed stimulus package?
(Videotape)
REP. JOHN BOEHNER (R-OH): Oh, my God. I don’t even–my notes here say that I’m disappointed. I just can’t tell you how shocked I am at what we’re seeing.
(End videotape)
MR. GREGORY: Will Mr. Obama be able to find a bipartisan solution?
Plus, a bump on the road to the Cabinet; Obama’s Treasury pick admits a taxing mistake. What could this mean for the nomination of Timothy Geithner? This morning, an exclusive interview with the man who will be by Obama’s side in the office: the gatekeeper of the president, incoming White House Chief of Staff Rahm Emanuel.
Then, Inauguration Day will be a time of great significance in this country. How will Mr. Obama capture the moment? And will his presidency be able to live up to the high expectations? Insights and analysis from our special roundtable: NBC News special correspondent Tom Brokaw; columnist for The New York Times David Brooks; presidential historian Doris Kearns Goodwin; host of PBS’ “Tavis Smiley” and PRI’s “The Tavis Smiley Show,” Tavis Smiley; and NBC News political director and chief White House correspondent Chuck Todd.
But first, incoming White House Chief of Staff Rahm Emanuel.
Welcome back to MEET THE PRESS. As we look forward to an historic day, Inauguration Day and the inaugural address, the president-elect has spoken about the need to capture the moment that Americans are in. What does he want to say on Tuesday?
MR. RAHM EMANUEL: Well, I, I don’t–at one level, I don’t think it’s different than what you’ve heard over the campaign. On the other hand, it’s a–the inaugural and the inaugural address is something significant in American history and its culture. I think the–what you will hear is a time and a place in which we all have an era of responsibility, that too long there’s been a culture of anything goes, and that to do what we need to do as a country, to, to regain America’s greatness and continue to move forward and be an example around the world, that we need that culture of responsibility not just to be asked of the American people, but that its leaders must also lead by example. And so that for–in both business, in the corporate boardroom, to in government offices, that there has been a culture of–that anything goes and is permissible, and that we want–must once again restore a values system that respects and honors a sense of responsibility, and that we all have something to give to our country and have an obligation to do that, to return it to its greatness.
MR. GREGORY: Does he want to call on the American people for sacrifice, given the state of our economy?
MR. EMANUEL: Well, I think–well, it’s–well, it’s not just the economy. This goes larger than the economy, David. It goes to a, a values system that, that has held us well for 200-plus years, a values system that’s about responsibility, about being held accountable, and that all of us have an obligation. So it’s beyond just–although sacrifice is important in restoring the greatness of the economy, it’s to a values system that is so much a definition of who we are as a country.
MR. GREGORY: Let’s talk about the economy. And as the stimulus or recovery package takes shape, the era of big government is back in a big way. And I want to ask you about spending. We have put together a rather staggering chart of the federal bailout and stimulus spending since February of 2008. The first stimulus, $168 billion; the money allocated for Fannie Mae and Freddie Mac, 200 billion, only about 14 billion of that has been drawn down by Freddie Mac; the bailout of AIG, the insurance company on Wall Street, 122.8 billion; the bailout money known as the TARP, you’ve now got the second half of that authorized, that’s $700 billion, some of that for the auto, Bank of America, Citigroup; the proposed stimulus–or recovery plan, as you put it, $825 billion. That is $2 trillion from February of ’08 and, if it’s passed in the middle of February, to February of ’09. Now, we wanted to put some of that in perspective here, in some context for the American people. In terms of the debt burden that Americans are going to facing, per household that’s $17,000 worth of debt. That’s an enormous burden on the backs of the American taxpayers.
MR. EMANUEL: Yeah. Well, as you probably know, that there–over the last decade, the last eight years there’s been actually a–there was a surplus at one time, and now we’ve added in the last eight years $4 trillion of debt to the nation’s obligations. What you see here–and the president has always said that we must have an approach to spending money differently and respect for the taxpayers’ dollars, and do it in a more efficient way and in a different way. And most importantly, we must deal with the long-term challenges that face this country. So while he has talked about the need–and everybody I think from economists on the left to economists on the right realize that we must make critical investments at this time. And yes, they’ll add to our obligation. It has got to be coupled with a serious attack about putting our fiscal house in order. And for too long that hasn’t happened. Challenges that needed to be met, responsibilities that needed to be met have not. So from the era–from the area of, let’s just say, in the defense area.
MR. GREGORY: Hm.
MR. EMANUEL: On an annual basis we have about $300 billion in cost overruns. That must be addressed, and we will be addressing it. Area of subsidies to corporate America, that must be addressed. And then also, dealing with the bigger obligations of health care costs and their–and what they have done to the federal budget. So all of that must be done. But it is essential that–and that’s why it is so important to put the economic recovery act in place, that you must begin to invest in creating three and a half million jobs and make sure that America’s long-term economic competitiveness, that the things–the foundations play.
But here is what that chart can’t tell you, that we have not yet approached to date in this economic crisis, the worst that we’ve ever had since the Depression, on a two-front basis; one, dealing with the financial stabilization fund to get credit flowing again and to get the system rolling again. Too many of those things you pointed to were dealing with institutions. What we have got to do and what we’re going to approach the second dollars with that we just–the Senate just approved, is an attempt to get banks again lending both to consumers and businesses. In addition to that, on the other side of the ledger is making sure people are going back to work, building this country and building up its new schools, its new infrastructure…
MR. GREGORY: OK.
MR. EMANUEL: …it’s new hospitals. So the economy is in such a state that you can’t just approach it with one hand tied behind your back. Both things must be done simultaneously, and done well.
MR. GREGORY: But Democrats were always critical of the Bush tax cuts, for instance, which were the first time that, that taxes were cut during a war. There’s a $1.2 trillion deficit forecast for 2009, as you well know. There’s a political element to this as well, and that is that the president-elect campaigned on a middle class tax cut. Now, the projections are if this were to become permanent tax cut beyond two years that would be part of the stimulus, that could be a $710 billion tax cut at least, at least.
MR. EMANUEL: Mm-hmm.
MR. GREGORY: Is that the responsible thing to do on top of the debt burden that we talked about, on top of the deficit I just outlined?
MR. EMANUEL: Look, first of all, let’s be clear that the middle class didn’t really participate in the tax cuts that you talked about in the last eight years; that they have worked harder, earned less and are paying more. And the middle class have the fundamental different approach.
MR. GREGORY: Right.
MR. EMANUEL: And that’s the change we want to bring to Washington as president.
MR. GREGORY: But an additional $700 billion?
MR. EMANUEL: President Obama’s been very clear, you cannot have a strong economy that does not have a strong middle class. And the, the approach has been to provide the middle class with a tax cut, and also to start getting the economy moving again by making critical investments. That’s why we want to create three and a half million jobs.
MR. GREGORY: Right.
MR. EMANUEL: The–it is no doubt you have to couple it, which has been very clear, which is why the President-elect Obama has called for an–a summit on fiscal responsibility to change the way we spend money, to do it in a more efficient way, to get rid of waste and fraud, but also to deal with the challenges that for too long have been kicked down the road.
MR. GREGORY: Let’s talk about spending. This is what the minority leader in the House, John Boehner, said on Thursday: “The plan released … by congressional Democrats … appears to be grounded in the flawed notion that we can simply borrow and spend our way back to prosperity.” You have said that the top priority is jobs, jobs, jobs when it comes to the stimulus plan. This is what Jerry Lewis had to say. He was the ranking member of the House Appropriations Committee, and this is what he found in this package, we’ll put it on the screen: “Before we pass this Pelosi-Obey legislation,” his release says, “the costliest in history, Congress has a duty to ask this basic question. … Are these items `stimulus’? Fifty million dollars in funding for the National Endowment of the Arts, $15.6 billion” increase in “Pell Grants, $200 million to `encourage electric vehicle technologies’ in state and local government motor pools, 1.9 billion in funding for high level physics research, 650 million to extend the coupon program to allow analog TV owners to continue to watch TV.” One more. “Four hundred million to the Oceanographic and Atmospheric Administration for `habitat restoration.’” What do these expenditures have to do with creating jobs?
MR. EMANUEL: Well, I’m–David, I’m surprised that you would say that about college education, in this sense: you wouldn’t be here and I wouldn’t be here if a college education was not provided to us. And the Pell Grants, one of the things that–the largest one you pointed to, helps people go to college. Now, is more–is it–important as it is to build our roads and bridges, our electric grid, our new health care IT so we can control costs, the ability to provide people the, the opportunity to go to college in a era where you earned what you learn is human capital investment.
MR. GREGORY: Right.
MR. EMANUEL: It’s the most important thing.
MR. GREGORY: That’s an investment, though. Is that a shovel-ready job?
MR. EMANUEL: No.
MR. GREGORY: Is it a shovel-ready project that creates jobs?
MR. EMANUEL: David, as you know, the president said very–two things: create three and a half million jobs and lay the foundation for long-term economic competitiveness so America, when it comes out of this recession, is a stronger economy to lead the world. For too long critical investments in this country, both physical and human, have been denied. And the things that were pointed there, I do believe investing in our basic science research is good economic competitiveness and does create jobs today and lays the foundation for competitiveness. Investing in people, in their college education in a era where you’re competing against people in China, India, money well spent. And those are critical areas. We hope everybody will go through it, identify things, will–as the president said, “I welcome ideas, but what I will not challenge is the ability to produce three and a half million jobs.” That’s why this–what’s adjacent to this…
MR. GREGORY: Rahm…
MR. EMANUEL: …and the, and the numbers you put up is–the fact is that’s economic plan and recovery plan does produce three and a half million jobs.
MR. GREGORY: OK. But what do you say to critics who say under the guise of stimulus and job creation is really the Democratic social agenda?
MR. EMANUEL: Well, it’s very clear this is a, a balanced approach. It has critical investments in both energy independence, education and health care cost control, as well as making the essential investments to make sure the middle class also get a tax cut. And I think that is a good approach to getting this economy moving and laying the foundation for long-term competitive economic competitiveness. That’s what this does. And what I find ironic, it just–it’s interesting, there are those who are now saying that, you know, it borrows too much. Not something we would want to do, but everybody agrees that economists say, both on the left and right, you must do something like this to get the economy moving. This is the worst challenge we are inheriting as a country…
MR. GREGORY: Mm-hmm.
MR. EMANUEL: …the single worst economic crisis since the Great Depression, and that the way to deal with that is to do something that you wouldn’t normally have to do, which is make big investments to get the economy moving. But I find it ironic, since one of the questions and the criticism about the deficit spending is coming from people who actually in a period of time in the last eight years were responsible for policies that left America farther behind in, in, in the sense of deep, deep red.
MR. GREGORY: Let me ask you about the transition, which has had some bumps along the road. There was Bill Richardson dropping out for Commerce, Leon Panetta with the CIA, and now Timothy Geithner. Very important job. He’s the nominee, of course, for Treasury secretary. This is how the Wall Street Journal reported his tax difficulties: “Mr. Geithner didn’t make any Social Security or Medicare tax payments on his income during the years he worked for the International Monetary Fund. … After the Internal Revenue” Services “audited him”–”Service,” rather, “audited him in 2006 and discovered the payroll-tax errors, Mr. Geithner corrected them for ’03 and ’04. Only after Mr. Obama picked him for Treasury secretary last fall did Mr. Geithner pay the Social Security and Medicare tax he owed for ’01 and ’02.” What gives?
MR. EMANUEL: Well, as Tim said, you know, it was a big mistake, it was an embarrassment. But he is the right guy for this job, which is why he has bipartisan support: Senator Hatch, Senator Lindsey Graham, Senator Judd Gregg. He has the right type of qualifications for this challenging moment in time.
MR. GREGORY: But that’s not really in question.
MR. EMANUEL: But, but–I know. But as he acknowledges himself, it’s embarrassing…
MR. GREGORY: Right.
MR. EMANUEL: …he made a mistake and it was wrong.
MR. GREGORY: But what happened? If he pays for ’03 and ’04 once he’s audited, doesn’t he say to himself, “Well, wait, maybe I should go back to ’01 and ’02″? He’s going to oversee the IRS, after all.
MR. EMANUEL: I, I understand that. And as he said, it’s an embarrassment, he made a mistake, but he has the qualifications for the job.
MR. GREGORY: Right. But why didn’t he pay the back taxes to ’01 and ’02 if he did it for ’03 and ’04?
MR. EMANUEL: Tim, Tim basically had–did ’03 and ’04, should have done ’01 and ’02, and he acknowledges he should have done it and paid them.
MR. GREGORY: Why is it if this was known in November, around Thanksgiving of course is when he was announced, why didn’t you all make this public so you wouldn’t get into a position where you’re not going to have him on day one?
MR. EMANUEL: No, no. Well, first of all, I do believe he’s going to get confirmed and I feel very good because he has the bipartisan support.
MR. GREGORY: Right.
MR. EMANUEL: Number two is we did the right thing by notifying the committee, which is the right process to do that. As you know, in some cases where committee members haven’t been properly notified first, it was wrong. So we followed exactly how you should do it. We notified the committee and worked with the committee.
MR. GREGORY: Is–does the president-elect stand behind him in his nomination…
MR. EMANUEL: Absolutely.
MR. GREGORY: …100 percent?
MR. EMANUEL: Absolutely.
MR. GREGORY: And you’ll continue to support him?
MR. EMANUEL: That’s what absolutely means.
MR. GREGORY: OK.
The president-elect was, was also rather adamant in support of Senate Democrats with the issue of Roland Burris. He, of course, was appointed by Governor Blagojevich in Illinois, who’s under investigation, has been charged with corruption. This is what the president-elect said on December 30th, when Senate Democrats opposed that appointment: “Roland Burris is a good man and a fine public servant, but the Senate Democrats made it clear weeks ago that they cannot accept an appointment made by a governor who is accused of selling this very Senate seat. I agree with their decision.” And yet just this week there he is, there’s Roland Burris being seated as a member of the United States Senate. Why the switch?
MR. EMANUEL: Well, the secretary of state of, of Illinois signed the papers to seat him. At that point there wasn’t a objection for the Senate. He was seated and has served at ready and cast his vote, as he did the other day.
MR. GREGORY: Senate Democrats switched their position, allowed him to serve.
MR. EMANUEL: You know, and also…
MR. GREGORY: As did the president-elect.
MR. EMANUEL: Yeah. Once, once the papers were signed by the secretary of state, who originally said he wasn’t going to sign it, he signed them. Roland–he also had nice things to say, as you just said also…
MR. GREGORY: Mm-hmm.
MR. EMANUEL: …about Roland, who is a person he obviously served with at a time in Illinois politics. He also said–has the qualities, he says, to be senator. And he–now he’s the United States senator representing the state of Illinois. The president’s priority…
MR. GREGORY: Mm-hmm.
MR. EMANUEL: The president-elect’s priority has always been to have a representative for the state of, the state of–the people of Illinois and the state of Illinois to get to work on behalf of the people of Illinois, because this is a critical moment in American history.
MR. GREGORY: And so President-elect Obama is pleased to have Roland Burris there?
MR. EMANUEL: He’s the United States senator, junior senator from the state of Illinois.
MR. GREGORY: And pleased to have him working with him on his agenda?
MR. EMANUEL: He’s–yes. I mean, he’s worked, he’s worked with him and talked to him already since he’s been in office.
MR. GREGORY: You haven’t talked about your role with regard to the communications between the Obama team. You haven’t talked about it publicly; I know you’ve obviously cooperated with everybody who, who’s asked you. And there was an internal report which specified that you had two calls with Governor Blagojevich and four calls with his chief of staff, John Harris. This had to do with who might succeed the president-elect in his Senate seat. What was the nature of those conversations?
MR. EMANUEL: As described in the document we made public, we talked in general about the, the right type of people that could be served as U.S. senator. And those are the conversations you would have with the chief of staff, and they’re all the appropriate conversations.
MR. GREGORY: At any point during those discussions with either Governor Blagojevich or with his chief of staff, did you get the impression or the distinct impression that he wanted something in return for exceeding…
MR. EMANUEL: No.
MR. GREGORY: …to the recommendation of the president-elect?
MR. EMANUEL: No.
MR. GREGORY: Nothing at all.
MR. EMANUEL: No.
MR. GREGORY: In the criminal complaint, it indicates that Blagojevich said that he knows that the president-elect wants a certain Senate candidate for the Senate seat, but “they’re not willing to give me anything except appreciation.” Expletive “them.” Why would he say that if there would–hadn’t been some discussion about whether he’d get anything besides appreciation?
MR. EMANUEL: Well, I–you know, I–if you need to, we can always make sure that Governor Blagojevich gets on the show. You need to ask him.
MR. GREGORY: OK.
This is what Majority Leader Harry Reid said on this program two weeks ago.
(Videotape, January 4, 2009)
SEN. HARRY REID (D-NV): Blagojevich obviously is a corrupt individual. I think that’s pretty clear.
(End videotape)
MR. GREGORY: Do you agree with that?
MR. EMANUEL: Well, you know, first of all you got to–the U.S. state–rather, the state Senate in Illinois is now in the middle of their impeachment hearings. You have an ongoing investigation. That’s what the grand jury and the jury is going to decide, if it goes to trial.
MR. GREGORY: But…
MR. EMANUEL: It would, it would be wrong, it would be wrong for me to make any judgment like that. You know, there’s a…
MR. GREGORY: Right.
MR. EMANUEL: There’s a governor who is obviously in the middle of impeachment hearings that are going to be…
MR. GREGORY: You’re going to withhold judgment.
MR. EMANUEL: No, it’s just–it wouldn’t be appropriate right–I have my own personal views, and that’s not what I’m here to show–share with you.
MR. GREGORY: OK.
MR. EMANUEL: OK?
MR. GREGORY: Should Harry Reid have with, with, withheld judgment, do you think, as majority leader?
MR. EMANUEL: No, I’m not going to–that, that’s for Harry, that’s for Harry Reid, the Senate majority leader. He expressed his role. I have a different position as a former–I mean, David, it’s self-evident, I have a different position as a former member of Congress from the state of Illinois. He was, he was the governor when I was a member of Congress, he use to hold the seat. I’m now chief of staff to the president. I’m not going to do that. That would be crazy.
MR. GREGORY: OK.
It–let my ask you quickly about the war on terror. President Bush addressed the nation on Thursday, and he had this to say about some of the decisions that he’s made. Take a look.
(Videotape, Thursday)
PRES. GEORGE W. BUSH: There’s legitimate debate about many these decisions, but there can be little debate about the results. America has gone more than seven years without another terrorist attack on our soil.
(End videotape)
MR. GREGORY: Do you agree that that is an accomplishment of this administration that is beyond dispute?
MR. EMANUEL: Well, we can debate about both the war–the decision to go to war in Iraq. I have my views. The president–I, I’m here to reflect the president-elect’s views, who said at the time that’s not the center on the war on terror, the people that attacked us are in Afghanistan. We did–just so you know, about 70 of us participated, the present administration and incoming people both from White House and Cabinet, in an exercise if there was a domestic terrorist act.
MR. GREGORY: Mm-hmm.
MR. EMANUEL: And we did it for about four hours. I think we did it on Tuesday of this week. And at the end of it, I thanked everybody from the outgoing administration for their patriotism, their sense of public service and what they did for the country. They clearly have lived with–the last seven years with a “what if” post-9/11, they did as professional public servants. We can have disagreements about policy–and I said it then, we will have our disagreements about policies and priorities. But they lived every day with the notion that there could be another 9/11. Things that we could live with, and we will live with. And you have to do things to protect the country. And they lived with that sense. Is it, is the, is the fact that we haven’t had an attack on this–on our homeland a result of Iraq? That’s not a, that’s not a conclusion I would draw. I don’t agree with that. I don’t think that’s a conclusion President-elect Obama would draw. And we will debate, I think, the decision of why you would go to war in Iraq. Given that we’re there, the president has made some decisions about what we have to do to reduce over the next 16 months our military presence there and begin to focus again on the war on terror as it relates to Afghanistan. They have done their job in the last–since that time in protecting the country. We will have policy differences.
MR. GREGORY: Mm-hmm.
MR. EMANUEL: But you have to respect them for their love of their country, their patriotism and their sense of public service.
MR. GREGORY: Before I let you go, there’s obviously the excitement and talk of unity in Washington between Democrats and Republicans with the inauguration of Barack Obama’s presidency. Take a look at our recent NBC News/Wall Street Journal Poll, it indicates the type of change the people are looking for: honesty and integrity, 36 percent; 29 percent, a significant number, want more working together, more bipartisanship between Dems, Democrats and Republicans.
You, however, Mr. Emanuel, have a reputation as being a fairly partisan guy over the years. This is how a colleague of yours from the Clinton days, Bruce Reed, introduced you last year at a Democratic Leadership Council event: “When we worked together in the White House we had a deal–I’d tell him everything I knew about policy, he’d teach me how to crush the enemy with my bare hands. … As Democrats we oppose torture, but we’re willing to look the other way when Rahm’s the one who’s doing it.” Now, you, you’ve had a reputation like this for a rather long time. This is something you actually wrote 20 years ago about how to beat a Republican: “Now that you have succinctly spelled out your own program, you can start dredging up dirt on your opponent. … Even if your early ventures fail to pan out, keep digging. The untainted Republican has not been invented.” My question is, the country is ready for change; are you able to change?
MR. EMANUEL: Yeah. Well, I, obviously, hopefully in the last 20 years I’ve matured. I do think that if you talk to my colleagues who’ve worked with me closely, that a number of Republicans will say that I’ve worked–as I did this week, just this week, helping the president pass a financial stabilization funds. Larry Summers and I spoke to the Republican Senate Caucus about why it, why it was needed at this time, and we got bipartisan support. I do firmly believe to fight for the policies of President-elect Obama wants to see enacted, and I will work with–help him work with Democrats and Republicans to accomplish that goal. I am a strong believer in the principles and policies the Democratic Party put forward. But if you look at my career, it has always been to work with Democrats and Republicans to get that done. I do that. And the president has clearly set an agenda. I think the biggest thing you should look at, in the last week something major happened. Even before president was elect–sworn into office, he got a major piece of legislation passed. He–and it was not popular. I mean, you would not call the play that we did out of the huddle, the first play, throw an 80-yard pass. Usually you do things that you build up your political support. He did it in two significant ways: made a decision, the legislation was passed with bipartisan support; and most importantly, not done with the type of rancor and political posturing that has been done over the years. It was done, people laid out their positions. But then the vote was cast, it passed 52-42–or actually, in this case he defeated it 52-42, and it was done with bipartisan support and not the type of arguments that have happened before. We will have those goals. And I helped, as his chief of staff, get that legislation; and also, most importantly, help change the tone in which we had a policy debate. So that’s my responsibilities. I’ll do that. You’ll be judge if I continue to be a better person than I was 20 years ago.
MR. GREGORY: Rahm Emanuel, good luck.
MR. EMANUEL: All right.
MR. GREGORY: Thank you very much.
MR. EMANUEL: Thank you.
