Meet The Press (03/06/2011)

MR. DAVID GREGORY: This Sunday, what do the events sweeping the Mideast mean for America's fragile economic recovery, as gas prices spike around the country? And the budget battle brewing here in Washington.

SEN. MITCH McCONNELL (R-KY): The latest proposal is unacceptable and it's indefensible.

MR. GREGORY: The White House and Republicans are far apart on how deeply to cut government spending. But is there an opening to fix budget-busting programs like Social Security and Medicare? I'll ask my exclusive guest this morning, White House chief of staff William Daley. Then, is the tea party agenda creating a division amongst Republicans, or laying the foundation for a successful challenge to the president in 2012? With us, the head of the tea party caucus in the House, Republican congresswoman from Minnesota, Michele Bachmann. Finally, political analysis on the president's handling of the crisis in Libya, the spending fight in Washington, and new moves among potential GOP contenders for 2012. With us, columnist for The Washington Post, Eugene Robinson; and columnist for The New York Times as well as author of the new book " The Social Animal," David Brooks.

Announcer: From NBC News in Washington, MEET THE PRESS with David Gregory.

MR. GREGORY: Good morning. A positive sign for the economy this week as unemployment fell to 8.9 percent, the third consecutive month that the jobless rate has actually declined. But the pain at the pump is now being felt as gas prices are on the rise across the country. And here with us live this morning for an exclusive interview, the White House chief of staff Bill Daley. President Obama chose him for the top job in January, you'll recall, after his predecessor, Rahm Emanuel, left the post to run for mayor of Chicago, successfully. Daley no stranger, of course, to Washington and politics. He was chairman of Al Gore's 2000 presidential campaign and, before that, Commerce secretary under Bill Clinton. Most recently he was an executive at JPMorgan Chase, and now brings his business savvy to a White House trying to repair relations with the country's business community. In the two months since taking the post, Daley has been busy behind the scenes courting corporate leaders, but also proving to be a key voice at the negotiating table during the budget battle. Mr. Daley, welcome back to MEET THE PRESS.

MR. BILL DALEY: Thank you very much, David. Good to be here.

MR. GREGORY: Good to have you here. Let's talk about the economy. And what's front and center in people's minds, unemployment numbers down, yes, but look what's happening as you go into the pump around the country and getting that sticker shock. Here are some of the numbers as we look at it across the country. The national average for regular gas, it stands at $3.5 now, up from last Sunday, from last month, and up significantly from last year at this point. And the cover of The Economist magazine sort of sums up the global component of all of this, "Just as the world economy was recovering." What does $100 barrel of oil mean to the economic recovery?

MR. DALEY: Well, there's no question that the increase in oil and the uncertainty in the Middle East has caused great uncertainty in the markets and -- affecting the price of energy. The president is extremely concerned about this. We've -- our economic team has been working with international organizations to make sure that we're coordinated. There is also not only uncertainty in the Middle East, you have an increasing demand worldwide as the economic difficulties of the last three years begin to improve. And as you mentioned, we've seen an increase in the economy. But we'll...

MR. GREGORY: But you have a glut of oil around the world. Is there a concern -- or is there a belief, I should say, that the recovery can weather a spike in prices?

MR. DALEY: Well, I, I think there's a sense that this recovery is real and is strong and is growing. But there are factors like the, the price of energy that can have a serious impact on it. In addition to this sort of macro discussion, there's real pain at the -- as this recovery's going on. People are getting back to work, as you mentioned, but the normal, average American out there is really feeling it. And so we're very -- the president is very concerned. We're trying to look at all the possible options going forward. We're very proud of -- to be honest with you, the president oversaw a very successful agreement between the auto industry on fuel economy standards that will increase savings of about a billion -- 800 million barrels over the term of the agreement between the auto industry and, and our government...

MR. GREGORY: Is the...

MR. DALEY: ...which is an enormous increase.

MR. GREGORY: Is the...

MR. DALEY: Also, if I can...

MR. GREGORY: Yeah.

MR. DALEY: ...we're on a very strong program between now and 2015 to make America the center of, of building capacity for batteries that will be used in the new cars of the future, from 4 percent to over 40 percent.

MR. GREGORY: But what about the shorter term? Does the president -- there's calls to tap the strategic petroleum reserve, which comes up during these spikes. Is the president considering doing something that can arrest that spike?

MR. DALEY: Well, we're looking at the options. There's -- there -- the spike -- the, the issue of, of, of the reserves is one we're considering. It is something that only is done -- has been done in very rare occasions. There's a bunch of factors that have to be looked at, and it is just not the price. Again, the uncertainty -- I think there's no one who doubts that the uncertainty in the Middle East right now has caused this tremendous increase in the last number of weeks.

MR. GREGORY: But it's on the table, which I think is the significant development.

MR. DALEY: Well, I think all consider -- all matters have to be on the table when you go through -- when you see the difficulty coming out of this economic crisis we're in and the fragility of it.

MR. GREGORY: I, I want to ask more about the recovery, but I want to stay with oil and the crisis in the Middle East. Over the weekend, fighting in Libya has expanded. We have pictures from an area, Bin Jawad, the northern part of Libya, also fighting among rebels as we get closer in to Tripoli. The president this week said Moammar Gadhafi has got to go. My question is

this: Is getting rid of Gadhafi of vital U.S. interest?

MR. DALEY: I think stopping the violence, first of all, that's occurring in Libya is most important. The president has been very aggressive. We froze -- we, we initiated sanctions quicker than we've ever done in the past, froze $30 billion of, of Gadhafi's money in the U.S. We've been very aggressive in our coordination with the international community in looking at all options. And we've also been very aggressive in, in bringing humanitarian aid to the region to help people. There's a tremendous humanitarian crisis...

MR. GREGORY: But it hasn't stopped, it hasn't stopped Gadhafi.

MR. DALEY: It has not stopped him, there's no doubt about it.

MR. GREGORY: So is it, is it in America's vital national interest that Gadhafi is gone?

MR. DALEY: It is, it is in -- Gadhafi should go for the people of Libya. He should stop this -- as the president said, he should stop the slaughtering of the people in this -- in the -- in these battles. And I think the international community...

MR. GREGORY: But if we, if we can't define if it's in our vital national interest, doesn't this say something about how far we're willing to go to get him out?

MR. DALEY: I think the international community's going to come together. There's tremendous -- there's, there's discussions going on right now -- they've been going on for the last number of weeks -- to try to have a coordinated effort to bring pressure on Gadhafi from the entire world to say, "Stop this." It is in the world's interest that this sort of action be stopped, and we're part of that community. And we are...

MR. GREGORY: But it sounds like the administration is more divided. I mean, even Secretary of Defense Gates said, "Look, let's not mess around here." If you're going to do a no- fly zone, that means that we have to bomb their air defenses. That's a big step.

MR. DALEY: Right. Yeah.

MR. GREGORY: Military intervention is something that the president does not sound like he's eager to do.

MR. DALEY: Well, you know, lots of people throw around phrases of "no-fly zone," and they talk about it as though it's just a game on a video game or something, and some people who throw, throw that line out have no idea what they're talking about. Bob Gates understands the difficulty of going to war. This is a man who spent his -- almost his entire life working for the government. He, he knows the difficulty of war and the challenges, as does Admiral Mullen. So when, when people comment on military action, most of them have no idea what they're talking about.

MR. GREGORY: All right, so -- but how does the president think about it?

MR. DALEY: And most of them know -- the president knows that the, the ultimate decision he has to make at times is to put men and women in harm's way. And you do that only with great consultation with your allies. You do that in a, in a, in a way that, that can protect those young men and women. And so, at this point, as the president has said, all options are on the table. But this has to be an international effort. It cannot be done by one country.

MR. GREGORY: But it still seems opaque to me. I mean, is it or is it not in our vital interest that Gadhafi goes? Why does it matter to America?

MR. DALEY: It is in our interest, it is in our interest that this -- as human beings-- as the president has said, his policy is first of all there should be no violence in these changes that are going on in the Middle East. You have to protect the basic human rights. And at the end, there has to be a process, both political and economic, for the people in these countries to have some opportunity of real change in their government.

MR. GREGORY: But nobody can force him out unless we lead the way.

MR. DALEY: Well, that is a, a statement that may or may not be true right now. I don't think you know that, I don't think I know it, and the world does -- hasn't come to that conclusion yet.

MR. GREGORY: Well, let me ask you more -- if we look at the map of the broader Middle East here, we've talked about Tripoli and Libya. But as you look across the map, and particularly the Persian Gulf states, there's a lot of anger at this administration. The Saudis, in Bahrain, in the UAE, where you've got Sunni governments with Shiite majorities, and they're saying, "Hey, look, we'll pursue democratic reform, but we are not going to allow a Shiite government to take over." This is a sectarian split in the Middle East. Does the president understand that there are limits to encouraging democratic reform, and those limits are the realities of our oil interests and stability in that part of the world?

MR. DALEY: The president -- what's been amazing about the changes that have gone on in the Middle East is that they truly are bottom up. They're not top down. The president went to Cairo almost two years ago and laid out his principles on reform in the Middle East; a rather courageous statement -- thing to do was to go to the Middle East and do this. And I think what you're seeing is a fulfillment of a lot of the aspirations of the young people that the president talked to two years ago. So the change is coming. It is not something that we can oversee and dictate. It has to be done by the people in these governments. Each one is different. What's been obvious since these changes began in Tunisia two months ago is that each country is very different. They've got to do it in a way that protects -- stops violence, do it in a way that protects the basic human rights of people, and the third principle of the president is end up with a governance that allows the political process and the political desires and economic desires of the people to be fulfilled. But it's up to the people in these countries to do that, and hopefully do that in nonviolent ways.

MR. GREGORY: Let me ask you about Afghanistan. There's been a meeting with President Karzai and our commander, General Petraeus, in the light of a bombing that killed nine kids, a NATO bombing. Petraeus apologized. And you have, this morning, President Karzai saying that the civilian casualties are no longer acceptable and that General Petraeus's apology is simply not enough. What needs to be done now to keep this partnership viable?

MR. DALEY: Well, well, President Obama spoke with President Karzai recently. No question we've -- we feel terrible about -- and, and not only the general, the president has stated his sorrow over this tragedy that occurred. Obviously, these are difficult actions when you're in the middle of a war. We went to Afghanistan in order to get rid of al-Qaeda. And our goal is to leave, and the president's goal, is to leave -- begin to leave in 2011, and we will do that.

MR. GREGORY: Has this done irreparable harm though? Another civilian incident like this?

MR. DALEY: It -- look it, this is a tragedy, no question about it. No one feels worse than the people who were involved in this tragedy and the military leadership in Afghanistan and our government.

MR. GREGORY: Let me turn to domestic affairs, and that's the budget battle at home. First, a piece of our Wall Street Journal/ NBC News poll on what's the top priority from the voter's perspective for the federal government. And it's interesting. Job creation is still 15 point -- by a 15-margin margin, the top concern, followed by the deficit and dealing with the debt. Does the president take away from numbers like this that the deficit can wait?

MR. DALEY: No, of course it can't wait. Our -- and that's why he's taken all the steps he has. I mean, this is a president who put a budget out -- forward that has frozen spending, is going to cut the deficit over $1 trillion over the next 20 years. So, so he's been very cognizant of the fact that we've got our -- got to get our fiscal house in order. No one's taken more steps, nobody's put an actual plan out, a budget plan just for '11 and for '12, that begins to bring the deficit down. There's a lot of talk in this town...

MR. GREGORY: Right.

MR. DALEY: ...a lot of talk around the country about it, but nobody but the president has taken steps to do that.

MR. GREGORY: There's -- a government shutdown has been averted for now, but it's not a long now.

MR. DALEY: Right.

MR. GREGORY: It's only a couple of weeks. And, you know, the White House says a lot about how it's meeting Republicans halfway. The reality is, you're very far apart. There's a lot of fuzzy math on both sides. The reality is you are far apart on cutting spending for this particular year. How do you bridge this and avoid a shutdown in two weeks?

MR. DALEY: To, to be honest, I would take exception. We aren't that far apart. We're at over $50 billion in cuts. The House passed the HR1, which was $100 billion.

MR. GREGORY: Right.

MR. DALEY: So we're over halfway there. Now -- no...

MR. GREGORY: No, no, but you know both of that relies on numbers on a budget that was never passed. It's easy to, to pass that past the American people. The reality is, you're about one-sixth of the way there. However you slice it, there's a big divide and you know it.

MR. DALEY: However you slice it, there is a challenge to our government. First of all, no business out there would be at the end of their first quarter and not have a budget for the year that they're in, much less putting a -- putting a budget forward that's for 12. We are only seven months away from the end of this fiscal year and we don't have a budget, which is kind of ridiculous. No, no company could get away with that. We've -- we have had -- Vice President Biden had a discussion with the four leaders. I think there's, there's total agreement that no one wants a shutdown of this government. That doesn't help our economic recovery. It will do only harm to the economic recovery. And as you're having the energy prices increase...

MR. GREGORY: Right.

MR. DALEY: ...it makes it even more ridiculous over the thought of it.

MR. GREGORY: But do you worry about -- you're meeting with Speaker Boehner...

MR. DALEY: Mm-hmm.

MR. GREGORY: ...you're in these discussions. Are you worried that he's not really driving the train here? I'm going to be speaking to Congresswoman Bachmann in just a moment, head of this tea party caucus. I mean, there's a real view that they are driving the leadership so far he may not be able to control what they do.

MR. DALEY: Well, I -- the last thing I'd ever do is speculate about the speaker's ability to control his caucus. My sense is, and I have great admiration for him, I think there's no question that understands that as speaker he not only speaks for his party, he leads the House of Representatives.

MR. GREGORY: Mm-hmm.

MR. DALEY: And that -- they and the Senate have to get together and agree on a budget or this government doesn't fund itself and we look ridiculous.

MR. GREGORY: What are the, what are the, what are the chances that you don't reach consensus and that there's a shutdown?

MR. DALEY: I, I think my -- I'm very optimistic that there will not be a shutdown. I don't think -- my one hope though, to be very frank with you, and one fear is, along with us coming to resolution on the numbers and the economics around this, there are, there are also, in the House, a number of political statements being made about amendments -- or add-ons to the bill...

MR. GREGORY: Right.

MR. DALEY: ...that address political statements that people want -- political funding...

MR. GREGORY: Funding for EPA or healthcare law. Yeah.

MR. DALEY: ...for -- in cutting funding -- no, it's, it's beyond that. And I-- my sense is that, that we've got to ask each of the members of Congress, "Are you going to do a shutdown if we don't come to economic compromise?"

MR. GREGORY: Mm-hmm.

MR. DALEY: "Or are you going to do a shutdown based on some of these political items?" Whether it's women's health care, whether it's environmental laws that they don't want to see enforced, and a whole host of other things, which would be unfortunate.

MR. GREGORY: The big driver of the, of the deficit, as you know, Social Security, Medicare, those are the real budget busters. And it was interesting, Speaker Boehner gave an interview to the Wall Street Journal. I'll put a portion of it on the screen. This is what he said. Speaker Boehner said Thursday, "...he's determined to offer a budget this spring that curbs Social Security and Medicare, despite the political risks, and that Republicans will try to persuade voters that sacrifices are needed. In an interview with The Journal, Boehner said House Republicans would offer a budget for the next fiscal year that gets goals for bringing the programs' costs under control." Is this an opening here? Did the president and Boehner talk about this and say, "Look, let's do something here together?"

MR. DALEY: Well, the president's been saying for quite a long time that we, we've got to, not only address our current budget problems, we've got to get to these large -- I would take some exception with your statement. Social Security is not the big driver of the deficit right now. We've got to strengthen Social Security for the recipients of that, but the -- but you correctly said it's Medicare and Medicaid that's the major driver, as we have an aging population, increased healthcare costs. Let me also say, you know, there's been much debate, much conversation around the healthcare plan, the Affordable Care Act. That, according to the Congressional Budget Office, will reduce our deficit by over $1 trillion over the next 20 years.

MR. GREGORY: But it makes a lot of assumptions about how that'll be funded down the road. But there's a "You first. No, you first" attitude here in Washington. I know from my own reporting that the feeling in the administration is, "Look, let's let the Republicans go forward and produce all of these savings for the entitlements. Let them do it first. And then we get into a political season and then they can be demagogued on that" on the way you guys feel you were on health care.

MR. DALEY: Well I -- but the president doesn't feel that way. The president's had conversations with Speaker Boehner, Leader Cantor, Congresswoman Pelosi, McConnell and Reid, Senators McConnell and Reid, and his -- he is not going to play the Washington games. We've had enough in the last two years. I think the American people are sick and tired of it. They're tired of the partisanship. And if anyone thinks that, out of this last election, the American people were voting for more partisanship, more saying no, I think they're, they're going to have a rude awakening in the next election.

MR. GREGORY: As you know, financial reform was much debated here in Washington and when you were at JPMorgan Chase was a significant concern and Wall Street and the financial community. And so this, this caught our attention during the Oscars. The director, Charles Ferguson of Inside Job, which is the documentary about the financial collapse, in accepting his

Oscar said the following: Forgive me, I must start by pointing out that three years after a horrific financial crisis caused by massive fraud, not a single financial executive has gone to jail, and that's wrong.

MR. CHARLES FERGUSON: Does the president agree that that's wrong?

MR. GREGORY: I, I, I think the president -- no one has been more out front on the need for financial reform. Obviously, the justice system will take its place, and the politicians should not engage in trying to say who should be prosecuted, who -- or who should not. That's not a responsible thing to do. So you have a number of justice -- attorney generals moving forward on cases that are legitimate. But the president felt very strongly, and that's why he fought so hard for financial regulatory reform, that the system has got to change. Most of the laws that the financial sector worked under were, were enacted closer to the civil war than to this century. And he fought and was tough. To be honest with you, I was in an industry that, at the time, as you mentioned, that fought many of it. Not all of it. Probably 80 -- 85 percent of it the industry wanted. They wanted to stop " too big to fail" and a number of other things. But it was controversial, difficult. But he hung in there and he got what he wanted, and that's a great statement of leadership.

MR. DALEY: Do you think it's illegitimate -- is it illegitimate for people to say that some of those CEOs on Wall Street should have gone to jail?

MR. GREGORY: Well, I -- look at -- I don't know if it's illegitimate or not. People have a right to say what they want. But I think if you're an elected official, you should allow the justice system to take over and move forward. And, and when there prosecutions that's up to that system. Politicians should not get involved. Producers, directors can do that, but politicians shouldn't get involved in that.

MR. DALEY: A couple of minutes left. I do want to ask you about politics and the re- election campaign for 2012. You'll be chief of staff presiding over that campaign. Is the president moving to the center to win re- election?

MR. GREGORY: No, the president doesn't look at -- this is a guy who does not look at politics in left, center, whatever. He really doesn't. I -- he looks at things, deals with the problem right in front of him. And I've never participated in, even back when I was co-chair of his campaign in Illinois, discussions that were around that. There's no question the difficulties of the first two years, he had to take actions that he didn't want to do. He didn't -- as he said, he didn't want to run an auto company. It was the last thing in the world he thought he was being elected for president to do. But he had to do it to save a million jobs. And that was criticized by many people in the business community. Many people saw it, "Oh my God, this is socialism, whatever." He saved those jobs. General Motors last month had one of its strongest months in decades of, of profitability. And that showed the wisdom of that decision.

MR. DALEY: Do you, do you still believe-- you said last year that there was a -- this administration got it a little bit wrong, that the country was center left, not left. You still believe it's a center left country?

MR. GREGORY: I think -- I -- what I was commenting on was the election of 2008. And I think it showed that there was a center left. But this president doesn't think that way. Some of us who, who pontificate on politics at times may talk that way, but he really doesn't. And, and I think when you look at the actions he took over the last two years, they've been center, they've been -- at times. People can interpret them however they want. But the fact is they've been focused on trying to create an economy that's stronger, trying to win the future as we get in this -- as recovery comes back. And our competition, as the president has said, is not amongst ourselves, it's amongst the rest of the world.

MR. DALEY: Are you concerned with Ambassador Huntsman making moves toward running for president? Have you given him a talking to as a member of the administration in courting the presidency?

MR. GREGORY: Well, I think there's been a lot of speculation of -- about him. He's of -- -he's said he's going to resign the end of April. But we're -- he's, he's done an excellent job on behalf of the Obama administration and we think that he is -- his...

MR. DALEY: Are you upset that he's still there talking about the presidency?

MR. GREGORY: I have not heard or seen any direct quotes from Ambassador Huntsman, which obviously would be inappropriate. But his support of the Obama administration, his support of the president, the things he did on behalf of this administration and the closeness in which he worked with the president is most appreciated. And I'm sure he'll talk about that in the primaries.

MR. DALEY: If he runs. Finally, is Mitt Romney the most formidable Republican you see?

MR. GREGORY: I don't know. You know, this is -- the president also, what I admire about him is he doesn't spend a lot of time talking about this stuff.

MR. DALEY: Yeah.

MR. GREGORY: You know, everyone else does...

MR. DALEY: He did talk about Mitt Romney this week, though, rather pointedly.

MR. GREGORY: Well, he did talk about Mitt Romney. But the fact is, you know, we've got enough issues to deal with to not worry about who's going to be the Republican nominee. There will be a nominee at some point, and we'll deal with it next year. The concern right now is our economy, creating jobs, giving confidence to the American people that this recovery is real, and, and doing the things that fortify their belief, which is the truth, that this is the greatest country in the world...

MR. DALEY: Where do you think...

MR. GREGORY: ...and the opportunities in this country going forward are there for them.

MR. DALEY: Where do you think unemployment has to be for him to be re-elected?

MR. GREGORY: I don't -- you know, that's -- there's so many factors involved. Obviously, we're happy that, very pleased that the, the trend seems to be moving forward, not because of a re- election, because you're giving opportunities for families to, to have jobs, and people to have a future and a hope. That's what it's about. I know that it's -- we can be pretty cynical in this town, but normal people out there in America, the last thing in the world they're thinking about right now is 2012.

MR. DALEY: All right. We will leave it there. Mr. Daley...

MR. GREGORY: Good. Thanks, David.

MR. DALEY: ... thank you very much. And coming up, one of the most outspoken critics of this president. She's traveled the country speaking to the tea party faithful. Now she's fired up and front and center in this debate over spending. I will talk to the head of the tea party caucus in the House, Congresswoman Michele Bachmann of Minnesota. Then, political analysis from Eugene Robinson of The Washington Post and David Brooks of The New York Times.

MR. GREGORY: Coming up, is the tea party dividing the GOP or helping Republicans frame the debate over spending? The head of the tea party caucus in the House, Congresswoman Michele Bachmann joins me. Up next, after this brief commercial break.

MR. GREGORY: We are back, joined now by the head of the tea party caucus in the House of Representatives, Republican Congresswoman from Minnesota Michele Bachmann. Welcome to MEET THE PRESS.

MR. GREGORY: Thank you, David.

REP. MICHELE BACHMANN (R-MN): Nice to have you. You heard the chief of staff, Bill Daley, say that he's optimistic that it's possible to avert a government shutdown. Are you as optimistic as he is?

MR. GREGORY: Well, I'm hopeful. I don't think anyone wants to see the government shut down, but it is shocking the revelations of all the money that's been spent. There was a Congressional Research Service report that just was issued in February, and we discovered that secretly, unbeknownst to members of Congress, over $105 billion was hidden in the Obamacare legislation to fund the implementation of Obamacare. This is something that wasn't known. This money was broken up, hidden in various parts of the bills. And we have worked very hard to discover $61 billion in cuts that we could put forward, get to the president. So, in effect, David, we've taken one step forward and two steps back because we've found now that $105 billion had already been implemented.

REP. BACHMANN: All right. But that -- but, Congresswoman, you heard the president this week offer...

MR. GREGORY: Or appropriated.

REP. BACHMANN: ...an accommodation to the states to opt out of the individual mandate, where necessary, to tailor it toward their own states.

MR. GREGORY: Well, David...

REP. BACHMANN: Why isn't that the sort of -- the give that Republicans wanted?

MR. GREGORY: David, that's not a give at all. In effect, all that is, is a pretext for implementing a single-payer plan. If you -- if you recall, the president's entire statement, he said the states can opt out as long as they stay within the, the requirements of all of Obamacare unless they want to go with a single payer-- again, from the very beginning it has been said that Obamacare is a crime against democracy. It has been a deception from the beginning. Remember, the president told us it was a mandate, not a tax. Now in the federal court he's arguing it's a tax, not a Band-Aid.

REP. BACHMANN: Will you -- I want to stick with the...

MR. GREGORY: We were also told that our premiums would go down $2,500 and instead, they're spiking up by 20 and 40 percent.

REP. BACHMANN: Let me get in here, Congresswoman.

MR. GREGORY: This has been a fraud.

REP. BACHMANN: Let me get in here. I want to stick with the, the narrow budget questions. Are you willing to vote to shut down the government over some of these add-ons to these spending bills, to defund funding for the healthcare legislation, for Planned Parenthood, for the EPA?

MR. GREGORY: I think this deception that the president and Pelosi and Reid put forward with, with appropriating over $105 billion needs to be given back to the people. There was no debate. There was no discussion. $105 billion is a lot of money. You can't just slip that into a bill and not tell members of the House and not tell members of the Senate, and then when they go to vote for the bill, did it just slip Harry Reid's mind to not tell the senators that this was in the bill?

REP. BACHMANN: Congresswoman, my question is a very, is a very direct one: Will you vote to shut down the government over those riders?

MR. GREGORY: I think that President Obama needs to give back that $105 billion that they already appropriated. They have tied the hands of Congress for the next eight years, David. They already appropriated this money. Members of Congress didn't even know this money was in the bill because we couldn't read the bill before it was passed because it wasn't given to us but hours before we had to vote for it. That's why Speaker Pelosi famously said we have to pass the bill to know what's in it. Members of Congress weren't even given the courtesy of time to read the bill. This $105 billion has to be given back before we can start any other discussions.

REP. BACHMANN: Let me ask, let me ask you about some tea party criticism of Speaker Boehner over how far the cuts have gone. The USA Today reported on this on Friday, I'll put it up. " Tea Party leader blasts Boehner over cuts. The founder of one of the largest Tea Party groups said House Speaker Boehner looks like a 'fool' ... because he has not cut enough from the budget. " Judson Phillips... [the] founder of the Tea Party Nation, Boehner's inability to negotiate," he said, "larger cuts should prompt the Tea Party movement to run a candidate against [him] in 2012 in a GOP primary. "' The Tea Party movement sprang up in '09 as a reaction to insane government spending,' Phillips wrote on his blog on Wednesday. 'In 2010, the American people spoke, demanding change. Everyone realizes that the level of spending cannot be sustained. John Boehner did not get that message.'" Has Boehner failed the tea party?

MR. GREGORY: The main message that's going across the Internet today among members of the tea party, they are outraged about this $105 billion that was deceptively put in the Obamacare bill.

REP. BACHMANN: Congresswoman, you've made, you've made your point.

MR. GREGORY: That's what they're focused on.

REP. BACHMANN: I'm asking you a direct question here about whether you think, as head of the tea party caucus, whether Boehner has failed to live up to the tea party's expectations.

MR. GREGORY: I think what we're -- we -- what we're trying to do as Republicans in the House is look for every place we possibly can to cut spending. We've identified $100 billion in cuts off of the president's proposed budget, $60 billion if you compare it to the 2010 budget. So we have done our part to look for cuts. But we can't be -- we can't end there. We have to also demand that we claw back the $105 billion that was deceptively already appropriated by President Obama.

REP. BACHMANN: The, the speaker has said that it would be irresponsible not to raise the debt limit, as will be called for soon. Will you agree with him on that and do that?

MR. GREGORY: I am not in favor of raising the debt ceiling. In the last 10 years we have raised the debt ceiling 10 times. We are just giving the Congress a license to keep on spending. And one thing the American people are demanding because they want to see jobs created, they want to see the economy get on a back -- good footing. In order to do that, government has to take less so that the American people can keep more.

REP. BACHMANN: The issue of the tea party and backlash among voters against the tea party is an interesting area because conservatives and certainly leaders and tea party folks have said, "Look, there was a mandate from the 2010 election, and that was to cut spending." And yet, you have this from -- analysis from our Wall Street Journal/ NBC News poll, written by the Wall

MR. GREGORY: "Among those most fearing spending cuts," they reported, "were younger voters, independents, seniors, and suburban women-- groups that include many swing voters in national elections, who potentially could turn against the GOP. "'It may be hard to understand why someone would try to jump off a cliff' to solve the debt crisis, [pollster] Mr. [ Bill] McInturff said of his fellow Republicans, 'unless you understand that they are being chased by a tiger, and that tiger is the tea party.'" Is the tea party chasing the broader GOP off the cliff?

Street Journal on Thursday: You know, I think that the political left has been very afraid of the tea party movement because it is not necessarily political. It's not Democrats or Republicans. It's made up of a very broad-based coalition. It's made up of people who want the country to work again. They believe that we're taxed enough already, the government shouldn't spend more money than what its taking in, and that each of the three branches of government should act within the jurisdictional limitations of the Constitution. That's a broad-based group of people. They just want our country to work again. And I think that that coalition is hanging together more strongly now than ever.

REP. BACHMANN: You've talked about foreign policy and been critical of this president and his handling of the situation in the Middle East. I want to play something that you said back in January while in Des Moines about the future of this country, and ask you about it. I'll play it first.

MR. GREGORY: The question, quite frankly, is this: Will America endure? And I don't say this melodramatically, and I don't say this to scare you or to say it lightly. Because tonight I think the answer is in grave doubt.

REP. BACHMANN: Can you say specifically what you mean about it being in grave doubt?

MR. GREGORY: Well, I -- my -- I believe the context of the remarks was regarding the economy. With the amount of spending and deficits that we are accumulating, that does put America's national security interests at risk because when we have foreign nations holding a tremendous amount of our debt, a trillion dollars nearly in the case of China, that can have national security implications. We do not serve our American interests well when we put ourselves in the hands of creditors.

REP. BACHMANN: What about the handling of -- by this president of events in the Middle East? Is it your view that it's in America's vital security interest to remove Moammar Gadhafi from power in Libya?

MR. GREGORY: I think that it's been troubling the way that the president has responded. For instance, in Libya during the unrest, we had at least 600 Americans who were there. The Chinese were in the process of removing 12,000 Chinese, while Americans were waiting for an American response to be removed from Libya. I think -- recently in Germany we saw two military soldiers who were killed by alleged terrorists this week, and I think that the president's response at minimum was lacking. We need to send very strong signals. I'm concerned about the signals that the president has sent. They seem to be signals of weakness, not strong signals in the Middle East.

REP. BACHMANN: But, Congresswoman, my, my question, my question, is it in America's vital interest to remove Moammar Gadhafi from power?

MR. GREGORY: Well, that, that question, I think, is one that, as, as Defense Secretary Gates has said, we need to be very careful about putting an army on the ground in the Middle East. We are extended now in Afghanistan and Iraq, and I think for us to consider further penetration at this time, we need to listen to General Petraeus and what he has to say.

REP. BACHMANN: Let me ask you about 2012. There's talk that you're considering a run for the presidency. And I wonder what you make of how people react to you. A lot of people think that you are an extremist, somebody who, you know, as you've done in the past, called the administration"a gangster government," is far more interested in fueling anger than becoming something of a consensus politician who can attract widespread support. How do you react to all that?

MR. GREGORY: I haven't made a decision either way about plans for 2012. What my concern is, is that our country move forward and that we regain a sound financial footing. I don't believe that Barack Obama has done a good job as president of the United States. I think that's beared out statistically on everything from anemic job creation to the out of control spending and deficits. The economy is simply not improving. Just consider, the day before the president took office gasoline was $1.83 a gallon. There are places today in the United States where it is over $4 a gallon. It didn't help that the president had the Interior secretary cancel 77 oil leases as soon as the president came into power. We can do so much better. And that's what I'm talking about with people in the next few months. We need to think very strongly -- a second administration of Jimmy Carter wouldn't have done this country any favors. We need to make sure we don't have a second Barack Obama administration.

REP. BACHMANN: You, you've referred to the Obama administration as a gangster government. You've said that this president has anti-American views. Do you believe that still?

MR. GREGORY: I believe that the actions of this government have, have been emblematic of ones that have not been based on true American values. Just consider Obamacare. Over 900 waivers have been given out to unions and protected special interests that are linked to the president. That's not right.

REP. BACHMANN: Is it appropriate to refer to the government as a gangster government and to question whether this president loves America?

MR. GREGORY: Well, I said -- I, I, I, I do believe that actions that have been taken by this White House, I don't take back my statement on gangster government. I think that there have been actions that have been taken by this government that I think are corrupt, thoroughly corrupt.

REP. BACHMANN: And you think, you think the president has anti-American views?

MR. GREGORY: Well, it, it -- I've already answered that question before. I said I had very serious concerns about the president's views. And I think the president's actions in the last two years speak for themselves.

REP. BACHMANN: When will you decide about a run for the presidency?

MR. GREGORY: I think there's a normal course of events when a decision like that will be made, and, and if I choose to go down that road, I'll make the decision.

REP. BACHMANN: Congresswoman Bachmann, we will leave it there. Thank you very much.

MR. GREGORY: Thank you.

REP. BACHMANN: Coming next, potential GOP presidential hopefuls inch closer to a decision, but what will it take to beat President Obama in 2012? Also, new numbers out from our NBC News/ Wall Street Journal poll. How has the plan -- president handled the crisis abroad and economic recovery back home? My guests, Eugene Robinson of The Washington Post and David Brooks of The New York Times.

MR. GREGORY: We're back with our roundtable: Author of the new book, " The Social Animal," columnist for The New York Times, David Brooks; and columnist for The Washington Post, Eugene Robinson. Welcome to you both. Congratulations on the book. Because when I think of you, I think social animal, David Brooks.

MR. GREGORY: It's not called the social -- the party animal. It's called " The Social Animal."

MR. DAVID BROOKS: Yeah, right. It's called " The Social Animal." Let's get right to it and I want to talk about the immediate stalemate here in Washington over the budget. This is something from our poll that was quite interesting, this question of role of government. Should the government do more or less? Fifty-one percent say do more; 46 percent say it's already doing too many things. I mean, this is the crux of the debate over reining in government spending.

MR. GREGORY: Right. The country really doesn't know what, what it wants and that's the essential problem. The country wants more government than it's willing to pay for. And so the question is, how do you get out of that situation? It's going to take a public education campaign to explain to people with pie charts and all the rest, "Here's what we've got, here's what's coming. Where do we cut?" And so, as you said earlier, neither party wants to go first. I was with a bunch of Republicans yesterday, and they are sort of -- have talked themselves into taking on entitlements in some form. And now that they've taken this step off the cliff, they're saying, "Eh, how we going to do that?" And they haven't quite figured that out. The Democrats, meanwhile, and the White House is sort of hanging back, playing a little rope-a-dope...

MR. BROOKS: Right.

MR. GREGORY: ...and letting them go forward. And that might be the smart strategy. The downside of that strategy is the president looks passive in this debate, and, and there's some weakness there.

MR. BROOKS: Eugene, this is the question, if Republicans are dominating the debate, which is now overspending...

MR. GREGORY: Mm-hmm.

MR. EUGENE ROBINSON: ... the White House would like to keep drawing them over and maybe even force them to, as I asked Congresswoman Bachmann, to shut down the government over funding of Planned Parenthood, for instance. But there is this split between Republican leadership and the tea party caucus and who's driving the train here.

MR. GREGORY: Exactly. That may be the more interesting split in Washington right now.

MR. ROBINSON: Yeah.

MR. GREGORY: Can Speaker Boehner and, and Majority Leader Cantor really, frankly, control the, the rank and file, especially the tea party freshmen who, who might want to slash and burn in a way that does shut down the government. And no one knows the political ramifications of that. You know, one interesting thing from that poll, though, David, is while we have this almost equal split, "should government do more or less," one thing that was clearer is that people rank jobs and economic growth over deficit reduction as their priority. And I think that kind of -- it didn't back up Republicans this week, but it made people pay attention.

MR. ROBINSON: Well, and I'm curious about whether Republicans realize that -- it doesn't seem to me that that message is resonating, that is, if we don't deal with our fiscal problem, we have uncertainty, and therefore the economy can't grow. That's the line that they're drawing through it. And you see from our polling, people want that focus on immediate job creation. And that gets to the president's point, which is you got to get the balance right.

MR. GREGORY: Yeah.

MR. BROOKS: You can't grow if you keep cutting so much.

MR. GREGORY: Yeah. You've got to have some priorities, and I'm not sure they've gotten there. For example, you could say we're going to cut but we're not going to cut things that invest in our future. We're going to cut things that are consumption or we're going to cut -- and this is the politically hard part but the unavoidable point -- we're going to take money away from affluent seniors and we're going to direct it to young people who are learning the most. We're going to transfer money to those who we can really invest in. And that's the politically difficult thing. But the fact is, we have a redistribution machine sending money from the young to the old. We've got to reverse that.

MR. BROOKS: I want to ask more generally about the president's leadership beyond the budget, also talk about this crisis in the Middle East. Gene, I do think the vital question is, is reducing -- removing Gadhafi in our vital U.S. interests? Because, if you answer yes to that...

MR. GREGORY: Mm-hmm.

MR. ROBINSON: ...then you could take the next step of some kind of military action. But we're in this very sort of opaque zone here...

MR. GREGORY: We are.

MR. ROBINSON: ...of how we feel about that.

MR. GREGORY: We are. And I think you -- actually, David, I think you could say yes to that question. But then what do you do?

MR. ROBINSON: Yeah.

MR. GREGORY: I mean, to that end, do you really try to impose a no-fly zone? Do you, do you really want American boots on the ground? The rebels in Libya are, are not exactly excited about the idea of a kind of U.S.-sponsored revolution. They're doing this themselves. I'm not sure how that would leave America standing if we participate to too great an extent in what they're trying to do. These have to be, as the president says, I think he's right, this is -- these are homegrown movements and they have to, have to express themselves that way.

MR. ROBINSON: But there's going to be some conflict, David, between the fact that young people in the Persian Gulf states are going to look up and say, "Wow, the U.S. helped get Mubarak out of there. They've talked tough about Gadhafi. We saw what happened in Tunisia. But when it comes to these Sunni monarchs, they're going to help them democratize, they're going to help them issue reforms, but they're not going to push them out.

MR. GREGORY: Right, and we're hedging, and I don't think we should be hedging. Maybe we can't do -- go in -- no one wants to go in with boots on the ground, but we've got to at least express our principles clearly that we're for democracy, we think autocracies are unstable, and we're for that kind of change. And we -- we're always hedging nuances that nobody else pays attention to that makes us look passive. The problem with a Libya is we've gotten ourselves into a bad situation by imposing sanctions on Gadhafi, essentially saying, "You've got to fight to the death because there's no way out for you," but then not doing the second step, which was actually removing him. So we've put him -- we've boxed him in, and now he's fighting back, and we're sort of doing nothing. It's a phenomenally difficult problem, but we've got to at least express our values clearly.

MR. BROOKS: You know, in a, in a sense, Bahrain is really, in a way, more interesting than, than Libya or, or in some ways more perilous for U.S. interests because Bahrain, you do have the Sunni minority monarchy, a Shiite majority there. And if the, if the monarchy gets overthrown, what do the Saudis do?

MR. ROBINSON: Right.

MR. GREGORY: The Saudis are, are, are absolutely opposed to a -- to regime change in Bahrain. And so what does the U.S. say and do in Bahrain? I just want to pay attention to...

MR. ROBINSON: All right. I want, I want, I want to leave it there. We'll take a quick break, come back, talk about 2012. How Republicans are shaping up, how the president, in a lot of people's minds, looks a little better against a Republican field this week at least. More with our roundtable right after this.

MR. GREGORY: We're back. I want to talk about 2012. So here's how it looks. The generic matchup, right, which is -- doesn't always mean a lot other than this is what a generic matchup looks like. And the president is slightly ahead of a Republican candidate. Does better, I believe -- I'm looking at Romney here -- yeah, he does even better against Romney or Tim Pawlenty. But there's a lot of hand-wringing this week over whether Republicans are up to the task. Jonathan Martin in Politico writes this at the start of the week, which led a lot of the

MR. GREGORY: Obama looking tougher to beat in 2012. Having gone from despondency in '08 to euphoria last November, a more sober GOP is wincing in the light of day as they consider just how difficult unseating an incumbent president with a massive war chest is going to be, even with a still-dismal economy. 'I consider him a favorite, albeit a slight favorite,' said former George W. Bush adviser Karl Rove. ' Republicans underestimate President Obama at their own peril.'" David Brooks, he knows about people underestimating politicians like, like George Bush, President Bush. Why -- what's going on that Republicans feel less confident?

coverage. "GOP reality check: Well, first of all, the president -- people -- independents vote on the basis of who they essentially think is competent. They look at the guy, and they just have an overall image, "Is he competent?" And Obama still has that image, and that has not been dented even all, all the policy disagreement. So he has that advantage. Then the second thing, they take a look at their own field and they see weakness up and down the line. I think the conventional view among Republicans is that there are a lot of flawed candidates. I personally think the strongest is a guy named Mitch Daniels, the governor of Indiana, who is a manager -- maybe not the most exciting guy, but a manager -- and is actually in the fight. The fights we're going have -- be having over the next couple of years, he's in the fight, he's not a retired guy. And so I think he'd be strong. But he may not run. And so everyone else looks at the rest, and they say, "It's not a strong field." The one other thing that I'm beginning to hear about is that people may say in September, "The field's not good enough. Chris Christie, the governor of New Jersey, you got to get in."

MR. BROOKS: Well, this is -- Eugene, this is what the field looks like, if you look at some of the polling right now. Huckabee and Romney-- Huckabee has been decidedly strange in some of this comments...

MR. GREGORY: I'd say.

MR. ROBINSON: ...this week talking about, you know, where the president grew up, talking about Natalie Portman and single motherhood, etc. You wrote this week, as somebody who's looking at it from a left to center perspective, this is not as formidable of a lineup as one might have thought.

MR. GREGORY: No, I think the, the issue for Republicans is you, you, you maybe can beat Obama, but you got to have a candidate. You got to have the right candidate. And I agree with David, or perhaps go a little bit further, I think it is a weak field, and I think it's, it's, it's indicative of that weakness that everyone is waiting for a brand-new New Jersey governor, who's done a lot of things, who's very dynamic, but who just got here five minutes ago, to get into the race and try to be president and carry the, the standard for the party. I think that, that shows where we are. They don't like the guys they already got.

MR. ROBINSON: Not it's interesting. Mitt Romney, his biggest issue of course is he pushed for health care in Massachusetts. I won't actually play the sound bite, but President Obama this week unleashed a vicious attack on him by complimenting him and saying, "Look, I agree with Mitt Romney about some of his approach to health care." It was last night that Mitt Romney talked in New Hampshire, an important early voting state, and said this about health care.

MR. GREGORY: Now our approach next door was a state plan to address state problems in ways that were unique to Massachusetts. ... We were one of the laboratories of democracy. Now, our experiment wasn't perfect. Some things worked, some things didn't, some things I changed. But one thing I would never do is usurp the constitutional power of states with a one-size-fits-all federal takeover. I would repeal Obamacare.

GOV. MITT ROMNEY: Is that enough to sound like Michele Bachmann, to get the Michele Bachmanns to support him?

MR. GREGORY: Yeah, good in my state, not in the others, no. The individual mandate is the core of the Republican criticism of it. And Romneycare, the Massachusetts plan, has the individual mandate. That's the core problem. I think his core message has to be to move off health care and talk about the jobs, which he tried to do this week. The problem with that strategy is that right now insurance premiums are skyrocketing. And so this is going to be a burning issue for the next couple of years. I think it's -- Romney has to say, "OK, we're pivoting off health care. We're going to talk about jobs and business management." All the other candidates are going to want to talk about health care, and the issue will be sort of live for them.

MR. BROOKS: And what is the, the proper response to a Congresswoman Bachmann on her full charge against health care that the president's going to have to mount in the course of the campaign?

MR. GREGORY: The president's going to have to -- well, first of all, he's going to talk about deficit reduction, and he's going to say, "You, you Republicans say you want to reduce the deficit. This reduces it by, you know, $1 trillion over the next 20 years. I'm the only one who's put that plan out there." He, he, he goes after individual Republicans in individual ways. For Mitt Romney, as you pointed out, he, he has a John Kerry problem. So, "Let me get you straight, you were for it before you were against it." That sort of thing. And he -- you know, he -- and then he says, "If you've got an idea, I'm willing to talk about it."

MR. ROBINSON: Mm-hmm. All right, we're going to leave it there. Thank you both very much. Be sure to visit our Web site this afternoon to watch our TAKE TWO WEB EXTRA with David Brooks and read an excerpt of his new book, " The Social Animal." He'll be on our web site, mtp.msnbc.com. That's is all for today. We'll be back next week. If it's Sunday, it's MEET THE PRESS.