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STATE OF THE UNION WITH JOHN KING

Sound of Sunday

Aired September 6, 2009 - 11:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


KING: I'm John King live at the Minnesota State Fair. And this is a special Labor Day edition of STATE OF THE UNION.

(Voice over): It's 11 a.m. Eastern, time for STATE OF THE UNION, "Sound of Sunday".

Seventeen government officials, politicians, and analysts have had their say. President Obama's Education secretary and his senior adviser, leading lawmakers on Capitol Hill. We've watched the Sunday shows so you don't have to. We'll break it all down with Ed Rollins and Joe Trippi, and the best political team on television.

STATE OF THE UNION "Sound Of Sunday for September 6.

KING: As the president prepares his big speech to a joint session Wednesday night, one of his closest aides voices confidence that despite declining poll numbers the president will regain the upper hand in the health care debate.

(BEGIN VIDEO CLIP)

DAVID AXELROD, SENIOR WHITE HOUSE ADVISER: I think we're going have major reform this year. Reform, again, that brings stability to people who have insurance so they're not abused within the insurance system, and gives the option -- gives the ability to people who don't have insurance to get insurance at a price they can afford, and brings the overall rate of health care spending down.

(END VIDEO CLIP)

KING: To achieve his goal, however, Republicans and even some Democrats say the president will have to make big concessions, especially on his call for a government-run plan to compete with private insurance companies.

(BEGIN VIDEO CLIP)

NELSON: Well, I think he has to say that if there's going to be a public option, it has to be subject to a trigger. In other words, if somehow the private market doesn't respond the way that it's supposed to, then it would trigger a public option or a government-run option, but only as a failsafe backstop to the process.

(END VIDEO CLIP)

KING: Leading Republicans say they're more than ready to listen to the president, but most say he has to dump the public option all together if he wants any GOP support.

(BEGIN VIDEO CLIP)

PAWLENTY: There's lots of things we could agree to on a bipartisan basis, John. The public option isn't one of them. The trigger option simply kicks the can down the road, all it does is delay the inevitable. For a lot of reasons it's a bad idea.

I think if the Democrats embrace the public option, even in the form of the trigger, they're going to shoot themselves in the foot.

(END VIDEO CLIP)

KING: As you can see, we've been watching all of the other Sunday shows so maybe you don't have to. Let's break down the sound of Sunday and discuss the state of the health care debate with two veterans of campaign and policy battles. Joining me from Washington, Democratic strategist Joe Trippi. And from New York bureau, Republican strategist and CNN political contributor, Ed Rollins.

Gentlemen, let me just start, and, Joe, to the Democrat first, the threshold question, what is the most significant challenge for the president Wednesday night?

JOE TRIPPI, DEMOCRATIC STRATEGIST: I think he has got to state what he wants in the bill. I think, you know, the one thing, Americans are not -- the American people aren't trusting Congress at all in either party. They do like him. They do trust him.

I think if he lays out what he wants in this bill and challenges the American people to join him and force Washington to pass it, that's his best shot.

KING: Ed, is it trust? Is it specifics? What is it the president has to do?

ED ROLLINS, REPUBLICAN STRATEGIST, CNN POLITICAL CONTRIBUTOR: Well, first of all, the specifics are still very vague and I think most people don't understand what this does, particularly elderly people who are in Medicare. They don't know, when you talk about cutting hundreds of millions of dollars in services, cutting back things that they think they have a right to, that creates great concern.

Equally as important, young people, they are not getting this thing for free. This is going to cost them money. It's either going to be their employer or they themselves are going to have to pay for it. And health care is expensive. There are a lot of things I think that can happen.

You can do as Governor Pawlenty said, knock down the barriers, create competition by letting insurance companies go across borders, good insurance companies compete in other states. But the idea of creating another governmental agency with hundreds of thousands of new employees, there hasn't been much success when the government runs things. You look at Amtrak, you look at the Postal Service, you look at many things, and I don't think the American public has much confidence so they can do that.

KING: Well, let's listen to the White House press secretary, Robert Gibbs, because, as you know, as the president prepares for this speech, he initially said, let's let the committees in Congress write the bill. Now the White House press secretary says Mr. Obama is prepared to be more specific.

(BEGIN VIDEO CLIP)

ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: They'll leave that speech knowing exactly where the president stands, exactly what he thinks we have to do to get health care done -- health care reform done this year. And he intends to do it.

GEORGE STEPHANOPOULOS, HOST, "THIS WEEK": And what he won't accept as well?

GIBBS: Well, we prefer to outline the positive rather than the negative, but I'm sure he will draw some lines in the sand on that.

(END VIDEO CLIP)

KING: Joe Trippi, Robert Gibbs says he will draw some lines in the sand. But as you know, many people want the president to referee the debate over the public option. In the Senate, moderate Democrats say the votes simply aren't there. In the House, more liberal members say it has to be in there.

Is it time for the president to come out and say to the liberal wing of the party, I'm sorry, I'm with you, but we don't have the votes?

TRIPPI: Well, no. I think what Gibbs said there is really important. And as I said before, the president has got to lay out what he wants in the bill and what he won't accept.

Again, when he gave it over to Congress to write this thing, that's the place where I kind of agree with Ed, people are going to start saying, wait a minute, what's in this thing? We don't trust the government.

Barack Obama is the best messenger to get across what he wants and what he needs -- what he thinks we need to do. And you know, right now he is dealing with a Republican Party that looks at this and says, look, they passed Social Security and Medicare under FDR. If we let them pass a successful health care plan, then we're going to be done for another 40 years.

There isn't a party left on the other side. He needs to ask for bipartisan support, but he has got to realize it may not come from many Republicans, it's going to come from asking Democrats to pass another real groundbreaking, successful bill on health care and add that to Medicare and Social Security as part of the Democratic Party brand for the future.

KING: But, Ed Rollins, the White House says the president will continue to say he supports a public option, even though they know the votes aren't there in the Senate. Is it time for him to fish and cut bait on that one, to be much more specific and tell the left, I'm disappointed too, but we have to give it up.

ROLLINS: Well, the interesting thing about this president, and obviously he ran a great campaign and he is still popular in the sense that people like him, they like him as a public figure, but they're not sure whether he's a leader.

The test is now coming after eight months, is this guy a leader? Can this guy basically take his own party and go in there and basically force them to come to a compromise that basically works to the benefit of the American public?

Republicans aren't going to be there. At the end of day, Democrats refuse to have any kind of tort reform. There's $200 billion a year spent on malpractice insurance and much of the things that doctors are forced to do, you know, additional X-rays or MRIs or what have you, is because they're fearful if they don't, they'll be sued.

That hasn't even been on the table. That has been refused from the beginning because trial lawyers are such an important part of the Democratic Party. So there's a lot that can happen if there was any willingness to compromise.

The bottom line here is after this speech, this is no longer the Democrats' or Nancy Pelosi's, this is now the president's bill. It's like Afghanistan. The president put his arms around Afghanistan and I think probably correctly, and it is now his war.

It's not George Bush's war. It's his war and he's going to have to fight his own constituency groups. I think he has to show leadership on this and fight his own constituency's groups to be successful.

KING: Well, Joe, I want you in on that point, but before I come in, I want you to listen to a man you know very well. Former Governor Howard Dean, you were instrumental in his presidential campaign a few years back. He was, after that, the chairman of the Democratic National Committee.

And he is among those on the left who says if the president is going to give up on the public option, then give up on the whole effort for health care reform. Let's listen.

(BEGIN VIDEO CLIP)

HOWARD DEAN (D), FORMER VERMONT GOVERNOR: If he's going to do that, then don't pretend you're doing reform. There's no point in spending $600 billion and giving it to the insurance industry. We know what they'll do with it.

So, you know, I'm very hopeful that he will stick to his guns and that we'll have the reform that we were promised in the campaign.

(END VIDEO CLIP)

KING: How deep, Joe Trippi, are the tensions on the left? You talk to them. You see people here at the state fair. You see people in our travels. You talk to them back in Washington. And they think the president, frankly, is giving up on them.

TRIPPI: Well, I certainly don't expect for the president to give up on the public option right now or in the speech on Wednesday. First of all, it's a very bad negotiating tactic. You want to leave it in there if you have to trade it or somehow back off of it, as Ed has said -- suggested for some compromise to bring the entire party together. You've got to keep it in there and have something to push off of.

But certainly that may be, you know, some kind of trigger mechanism, this was talked about earlier, that leaves it to the insurance companies and the health care system. But if they don't compete and keep it low, it triggers in.

We don't know what the president is going to call for on Wednesday, but I certainly would not expect him right now to back away from this.

KING: Let's talk a bit about the marketing of this, the politics of this. Here at the state fair, easy to get buttons like this from the Republicans. "Change, I'd like mine back," or "hands off my health care."

Ed Rollins, is the Republican Party -- it's criticizing the president's plan. It certainly has made some traction in terms of turning people against the president's plan, but is it doing anything positively for itself down the road? Do the American people see a Republican alternative or just the Republican Party standing up to the president?

ROLLINS: A year ago -- last November the country wanted change. They were tired of the Bush administration and they wanted somebody new. Obviously it was going to be a Democrat, it was going to be Hillary Clinton or Barack Obama, the course of the primary showed us that Barack Obama was a very effective campaigner.

But they didn't know what the change was going to amount to. And I think to a certain extent, I fully admit this president inherited a terrible, terrible mess for a variety of reasons. But I go back to the point, the country is not sure what kind of leader he is. They didn't elect Nancy Pelosi to lead this country or Barney Frank, they elected Barack Obama.

And I think to a certain extent, if they think this country is going too far to the left, spending way too much money with its own health care or other things, the young people are going to pay the cost of this, and I think to a certain extent the great constituency, the support of this president, which were young people, that all of a sudden they see, gee, there are a whole bunch of things going on here that I'm going to have to end up paying for, that causes them real concern.

So I think to a certain extent this president has got to be very clear and very tough in this speech. And it's a very hard form to do it in. State of the Union speeches are not always the best forum before the Congress.

KING: I'm going to ask you both to stand by. Much more to come with Ed Rollins and Joe Trippi. But first, a quick taste of how this health care debate is playing out right here at the Minnesota State Fair.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: Fries!

UNIDENTIFIED FEMALE: You can take two kernels and cast your vote, where would you like to see health care reform?

UNIDENTIFIED FEMALE: These are corn kernels and we're asking people to take votes on what they would most like to see in health care reform. People have been voting all day and the options are improving access, bringing down cost, bringing down prescription drug costs and strengthening Medicare.

KING: Who's winning right now?

UNIDENTIFIED FEMALE: It looks like bringing down costs which is the universal issue we've been hearing from everyone.

UNIDENTIFIED MALE: We have buttons and we have lots of literature and if you guys really want to learn something, come in and talk to us.

KING: What are the favorites here?

UNIDENTIFIED MALE: Both of these, but this is probably the most favorite. This is the one that sells big right now.

UNIDENTIFIED FEMALE: Leave a message, this is the direct line to the White House.

UNIDENTIFIED MALE: People seem to have an idea that single payer is a good idea and many people don't. So I don't know.

KING: Polite, or does it get argumentative?

UNIDENTIFIED MALE: No, it's pretty polite.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

KING: We're back with Democratic strategist Joe Trippi and Republican strategist Ed Rollins. And we're live here at the Minnesota State Fair. You see the CNN Express there. Gentlemen, I want to move to a broader conversation that involves health care, but also the president's overall agenda. I want to start by showing you the front page of "The Washington Post" here. Both of you have maybe seen it this morning. "The change at a crossroads" is the front-page story in "The Washington Post."

At a crossroads, the president's agenda because of rising public skepticism. We found some earlier this week. I was on a farm in rural Wisconsin, Waterloo, Wisconsin, to be exact, and I talked to a farmer there. His name is Bob Topel and he's clearly suspicious that the government can afford things and that the government has the competence to do things. Let's listen.

(BEGIN VIDEO CLIP)

BOB TOPEL, WISCONSIN DAIRY FARMER: To me, just looking at the way the government managed the Clunkers Program and managed FEMA and Katrina and all of those things, I just -- I don't want to turn my health care over to a government agency and try to get my round peg in a square hole. And if it doesn't fit, I'm caught in some bureaucratic red tape.

(END VIDEO CLIP)

KING: Joe Trippi, how much do those broader concerns? They may be inherited from the Bush administration, but you travel and people just say I don't trust the government to do anything. They were going reform Medicare and Social Security under Bill Clinton, they didn't do it. They were going to do it under George Bush, they didn't do it, then FEMA, Katrina, the Iraq war. How much of a price does Barack Obama pay for the suspicions that government can get anything right?

TRIPPI: Well, ironically, it's the Republicans who are making that case today. When after eight years of George Bush, that is what Barack Obama inherited. I think, look, this whole debate is driven by two things right now. The fact that the Republicans do not want to help pass this -- pass health care because they fear another Social Security or Medicare very popular program that people will view as a success.

The Democrats on the Hill remembering the Clinton health care bill where they went for everything and got nothing and then walked away with no health care reform at all for the $37 million at the time, now 47 million Americans who don't have health care.

That's what's driving what the president is trying to get done and that's why when you talk about the public option and whether he's going to keep it in or not, that is sitting at the crux of all of this and if the Democrats -- should the Democrats walk away with that and get something for the millions of Americans that don't have health care and lower the costs for those who do and -- and you know, sort of walk away from the whole loaf. That's what may happen here because of the politics regardless of how partisan the president has tried to really make this.

KING: So, Ed, I want you to step back and assess the moment. You've been with the president at high teams and at low times. I want to show you some poll numbers, almost eight months into the Obama administration. How is the president handling the economy? He's fallen down to 49 percent. What about healthcare? Forty-four percent approve of his handling of that. And on the budget deficit, 36 percent approve of how the president is handling the budget deficit.

Now Ed Rollins, you're a Republican, but I want to ask you for your best neutral advice here. What happened to the president of the United States? How did he get to this point? ROLLINS: He dropped awful fast and I think to a certain extent, there are high hopes far beyond probably beyond that any man could meet the expectations that he was going to be different, that he was going to be able to bring Republicans and Democrats together and basically make the system work far better than it has ever been before.

He has tremendous communication skills. He can read off a teleprompter as well as anybody, but the bottom line is this is hard sledding and it's an economic crisis today and I think people really wanted the president to focus creating jobs, 9.7 percent unemployment as of Friday. That's going to continue to rise.

My concern for the president as an American, not as a Republican, and I didn't answer your question about the Republicans coming back, we will come back when people like Pawlenty and others move to the forefront and become the leaders of our party. But at the end of day, we are moving forward because people now see what the president's doing and the Democratic Party is doing is not solving the problems of the country and I think to a certain extent, the biggest fear...

KING: What people feel a year from now, September 2010 will mean a lot more when they go to the ballot than how they feel right now in September, 2009, but I want you both to consider this, written by Charlie Cook, the esteemed author of the "Cook Political Report." He writes this, and I want to see if you agree with it.

"Wave elections more often than not start just like this, the president's ratings plummet, his party loses its advantage on the generic congressional ballot test, the intensity of opposition-party voters skyrockets, his own party's voters become complacent or even depressed. And Independent voters move lopsidedly away. These were the early-warning signs of past wave elections. Seeing them now should terrify Democrats."

Joe Trippi, when you look at the moment now, I know there's a lot of time, but right now if you look at this moment and the upcoming 2010 elections and feel a little bit of that terror?

TRIPPI: Well, that's certainly what happened in 1994, and I think a lot of Democrats on the Hill in particular are starting to feel that angst today and that is riding much of the -- the, you know sort of the trembling that's come out of this health care debate.

But I -- you know, it's really too early to tell. In fact, one of the things I'd say is I wouldn't be surprised if this was a wave election that took out indiscriminately Republicans and some Democrats because of their inability to get anything done.

TRIPPI: If this all starts to fall apart, it could fuel a revolt against both parties for all people who are incumbents. I put it that way.

ROLLINS: There are over 50 congressional seats that the Democrats now sit in that either John McCain carried or were Bush. These were seats that were drawn for Republicans, Republicans have served in them for the last decade. I think there's an opportunity to come back. Those are 51-49, 52-48 seats. I think those are the seats that we have -- those are the Blue Dog Democrats, those are the ones who basically are very frightened at the cycle. I've been in this game too long to basically make any predictions a year in advance, but I think there are some things coming and I think the most serious thing is this economic crisis and the war in Afghanistan which Joe obviously is a great Democrat strategist, but his constituency, Obama's constituency is very anti-war. Republicans are going to be the only ones that are going to be supporting him long term if he stays in that war. And those are two big, big burdens for a president or Democratic Party to carry in the midterms.

KING: Let me ask you about something that just happened overnight and ask you whether it's significant or whether it's an isolated incident. That is the resignation of Van Jones, he was the green jobs czar in the White House, an environmental adviser to the president. Before he came into the administration, he used some choice words about Republicans, also signed a petition at one point that suggested perhaps the Bush administration senior officials allowed 9/11 to happen. He resigned. He finally went out. The White House had stood by him for a couple of days. Here's Howard Dean again on the resignation of Van Jones.

(BEGIN VIDEO CLIP)

HOWARD DEAN, FORMER DNC CHAIR: I know this guy, and I just talked to him about this so I'd like to weigh in after John does.

UNIDENTIFIED MALE: Go ahead.

DEAN: I was just going to say that this guy is a Yale-educated lawyer. He's a best-selling author about his specialty. I think he was brought down, I think it's too bad. Washington is a tough place that way.

(END VIDEO CLIP)

KING: Joe Trippi, as you know, this was the big driving cause on conservative talk radio last week. Now that they have forced one resignation, isolated incident or will they keep gunning?

TRIPPI: They're going to keep gunning. I mean, look, this administration has the potential to be FDR or Jimmy Carter, and I think the Republicans are going to do everything they can to make him Jimmy Carter, to created a failed presidency.

That's unfortunately what many of them want and I -- and again, we have a -- I really do believe a post-partisan president who is trying to work with everybody, but the Republicans aren't going to cooperate. He's got to understand that, continue to be bipartisan, call on the American people to support that, but realize he's sticking his hand out and many Republicans are just not going to -- just not ready to embrace it.

ROLLINS: Presidents don't come down by what the opposition party and that's what we are. We're an opposition party. There are many things Obama's offering that we don't believe in, so why should we compromise on our principles? You've got all the votes, you can do whatever you want. In the case of Mr. Jones. I don't know him. All I can tell you is having been a White House person, when you embarrass the president as he has and you become part of the focus when you should be talking about health care and other things, he did the right thing. He got out of there, but the more fundamental thing is there are 31 czars in that White House. This is a new job that is crazy when you still have half of the administration, presidential appointees are not filled and we're almost a year into the administration. That's what they have to focus on, get people in there that can do the job and not people who become controversial.

KING: Ed Rollins and Joe Trippi, we thank you both. A spicy conversation this Sunday, we'll do it again.

And according to the official Web site, over 1.2 million people have already visited the state fair right here in St. Paul, Minnesota. Up next, we'll sit down with three of them and hear their opinions on the health care debate and much, much more.

(COMMERCIAL BREAK)

KING: To walk the fairgrounds here is to see a lot of fun and more than a bit of mixed or you might say conflicting messages. There is, for example, a wellness clinic, a place to check your blood pressure, get advice on a good diet. It happens to be just steps from booths selling things like fried Oreos and big, fat bacon. Big, fat bacon, that's one pound, a third of a pound of bacon, fried, caramelized, maple syrup and served on a stick. There are pork chops on a stick, hot dogs on a stick, waffles on a stick. You get the picture. Garlic fries was my delicious, but not so healthy choice as we sat down with some fairgoers to talk about health care and the president's big speech.

(BEGIN VIDEOTAPE)

KING: All right. The first thing I'm going to ask, because somebody needs to explain this to me.

UNIDENTIFIED MALE: It's fat on a stick.

KING: Fat on a stick. But if I eat it at the fair there are no calories, right?

UNIDENTIFIED FEMALE: Oh, no, there are.

UNIDENTIFIED MALE: There's a lot in there. The corn batter, the batter. KING: Let me segue from the powder puff to the health care debate. How about that? When you watch the health care debate in Washington, satisfied, dissatisfied?

SUSAN REYNOLDS, ST. PAUL, MINNESOTA: Dissatisfied.

KING: Why?

REYNOLDS: The government needs to take care of everybody, not just the people on Medicaid and the low lifes. The low lifes get better care than the human beings that are out working and trying. And insurance is astronomical. It costs me $350 a month to insure my 14- year-old daughter.

ROGER AKENBUOM, ST. PAUL, MINNESOTA: The reason I don't like what the government is doing is because the Republicans are not putting forth anything on which to debate. They are just saying we don't like this, scaring people away from the debate and going to town halls and not having a debate and just having a shouting match.

REYNOLDS: I'll agree with you on that one.

DAVE THIESEN, ST. PAUL, MINNESOTA: I'm not afraid to say it. I'm a Democrat so I'm for what the Democrats are going to move forward, I just wish they would work together instead of always against each other.

KING: And there's a big divide in the Democratic Party about whether you want a robust public option, a government-run health care plan that would compete with private insurance companies or whether to try something else, maybe like co-ops like you have, like your farmers have here in the Midwest a lot. Do you think we need a big government option?

THIESEN: No, no, I don't.

AKENBUOM: I think there should be a public option in there. If you don't like it, don't take it. We have other services competing with the federal government. We have the postal service, we have UPS.

KING: The president is going to give a big speech to Congress next Wednesday night. He's lost the initiative in August because of these town halls and other things. Is there one thing you want to hear from the president that makes you think, OK? I might not agree with everything you say, but at least now it seems like you have the debate back on a grown-up track?

AKENBUOM: How is he going to manage to keep down the budget deficit and stuff like that? That's what I was looking for.

REYNOLDS: They're interacting like a bunch of 2-year-olds when they debate this. It's the same thing with Hillary. The Republicans crashed her and she had some good -- I'll give it to Hillary. I pulled for Hillary. If she have been running, I would have voted for her.

THIESEN: So the price is a big thing and it should be a universal coverage.

KING: If you voted for Obama, raise your hand. We have two? OK. We're at seven and a half, almost eight months into the administration? Not any one issue. He talked about fixing the economy. He talked about doing health care.

KING: He talked about a number of things. But the biggest thing he did was he talked about he was going to change Washington, that he was going to change the way Washington works, that people were going to get along; he was going to be bipartisan.

On that singular promise, let me start with you. Does Washington look any different to you than it did under Bill Clinton or under George W. Bush?

(UNKNOWN): Not yet. I just think he's -- because it's just a battle for him. I -- I -- not, to me, I've never seen -- I haven't seen a big change.

(UNKNOWN): He has to call those Blue Dog Democrats to the White House and tell them what he expects of them.

(UNKNOWN): You know, I don't know if he should be in there banging heads right away. I mean, I think he's trying to build a relationship, I suppose, between the Democrats -- trying to pull them together, but I just don't think he's had enough time.

KING: Back live, now, at the Minnesota state fair. A quick break here, and then back with three of our best correspondents to talk more about the sound of Sunday and the big week ahead in the health care debate. Stay with us.

(COMMERCIAL BREAK)

KING: I'm John King, and this is "State of the Union," live from the Minnesota state fair. Here's some stories breaking this Sunday morning.

President Obama returns from a weekend at Camp David today and faces a big week ahead. On Tuesday he gives that now controversial address to the nation's schoolchildren.

On Wednesday the president tackles health care reform in a critical speech to a joint session of Congress.

And on Friday, the president attends a 9/11 memorial tribute at the Pentagon.

Election officials in Afghanistan say they've turned out votes in nearly 450 polling sites because of election fraud allegations. The latest results show Afghan president Hamid Karzai creeping closer to the 50 percent needed to avoid a runoff. Results from a quarter about of the polling stations, though, still have not been released.

White House environmental adviser Van Jones is resigning. Criticism of Jones was mounting for past negative comments about Republicans and for signing a petition that suggested high-level Bush- era officials deliberately allowed the 9/11 attacks to take place.

An Obama administration source says Jones didn't read that petition carefully. That and more, ahead on "State of the Union."

Joining me now from Washington, CNN senior congressional correspondent Dana Bash, senior White House correspondent Ed Henry and senior political correspondent Candy Crowley -- Crowley -- excuse me.

Let me ask you first about the New York Times today: "A Policy Debacle and Its Lessons," a story about the Clinton health care plan on the front page of the times. And inside, Bob Dole is quoted about the -- President Obama, the current president, saying this, "The biggest mistake Obama made, and I want him to succeed, is trying to rush it. Why put some arbitrary deadline on a piece of legislation that's going to affect every American?"

Candy, a big chance for the president, this week, to try to reset the health care debate. He had a tough August. What does he have to do in that big speech?

CROWLEY: I think, if you listened to the Democrats, what they want to hear is, what can you tolerate and what can't you tolerate?

They feel, many of them on Capitol Hill, that they don't really know exactly how far the president's willing to go in terms of compromise, how much of a public option he may want, whether it's a trigger public option or just a full-blown public option.

So what they want is some kind of guidance here which they feel has been lacking. And I know Dan and Ed have done some reporting about how they may be, in fact, doing a bill, sort of, detail by detail.

So that might help. But certainly, at the very least, what Democrats want to hear is what they need to hold the line on and what they can let go.

KING: Well, let's break that down a little bit further. And, Dana, let's start with you. In the hall will be liberal Democrats who say, "Mr. President, don't you dare give up on that public option," and moderate Democrats who say, "Mr. President, I want it too, but we can't have it. We don't have the votes."

Do they respect the president to referee that one in the speech?

BASH: Well, referee to a certain extent. I think that they're hoping that he will, And if you listen to president's top advisers this morning, they insist that there will be no question where he stands by the time he's done with this speech.

That is what -- as Candy said, this is what Democrats have been virtually begging for -- begging for -- we talked about this just last week -- for some time because there's only so much that they can do because there is such a gulf, a real gulf within the Democratic Party on Capitol Hill. And he's got to -- he's got to do this. And, you know, the White House says he's going to. He's already reaching out, John, to some of those progressives. He had a -- a conference call on Friday, seeming to be laying the groundwork to move away from what they want. So there are a lot of tactics going on here, I think, to give people the details that they're looking for.

KING: So, Ed, take us inside the ship. The president, for months, has said, let the committees write it; let the committees write it. Now the White House says he will be more specific. He will draw some lines in the sand.

You do this out of a position of strength or, as many would say, a position of weakness?

HENRY: It seems to be a position of weakness, given what the town halls we saw and whatnot this week. But when I speak to senior advisers like David Axelrod, what they insist is that, when you look at CNN polling, for example, this week, maybe the picture is a little bit better for this president.

For example, we had one poll number looking at, do you want Congress to pass a bill with a little bit of change, a lot of change, or just go home and do nothing, it was almost 80 percent -- about 78 percent wanted some sort of changes, but they wanted a health bill. Only 20 percent in that poll said do absolutely nothing.

So the White House is believing, and maybe it's a parallel universe, but they really believe that the town halls were not as bad as people think, that maybe some of them got blown out of proportion. And they think the president has an opportunity to say, look, we need to get something done; now let's get more specific.

And I think, on the public option, he's not going to throw it under the bus, but he's essentially, maybe, going to tape it to the side of the bus. It's going to be dangling there. And it's basically going to be, look, this is what I want, but I realize it may not be there in the end to get a deal done.

And if he has to drop the public option, according to some top advisers, in order to get a deal, he's going to get a deal, whether it's working with Olympia Snowe or someone else. He's put too much political capital on the line to go home with nothing. If he has to drop that, he's going to do it to get a deal, John.

(CROSSTALK)

KING: Well, sometimes, if you're reading between the lines, you get a sense of where people think a debate is -- go ahead, Candy. Jump in.

CROWLEY: I just wanted to say, you know, the problem for the White House isn't that 80 percent of people want reform. It's the kind of reform that they want.

If 80 percent of people wanted a public option, well, then, by golly, they'd have a public option because, when you look inside the numbers, what's the problem for the White House is that, gradually, the idea of whatever people perceive, what the president -- whatever they perceive Obama health care to be, about split down the middle the American public.

And that's -- even in the non-screaming town hall meetings that were out there, there were some very tough questions, particularly about this public option and the cost of it.

KING: And, Dana, help me on this one, reading between the lines, Senator Amy Klobuchar was here earlier today. She would be defined as a left-of-center Democrat, but she tries to stick to the middle.

KING: Ben Nelson was on before her, he said there is no way you get a bill unless the president backs off on the public option, maybe accepts a trigger where it would kick in two or three years down the road if insurance companies don't do what they're supposed to. So I said to Senator Klobuchar, could you accept that and she said this --

(BEGIN VIDEO CLIP)

KLOBUCHAR: It certainly is worth looking at, but we have to push competition. We have to do a better job of putting some rules on the insurance companies.

(END VIDEO CLIP)

KING: Worth looking at led me to believe she understands that's where the debate is going, but what happens if that's where the debate goes in the Senate, where you have some in the House and Howard Dean said just today if you don't have a public option forget about it. It's just not worth it.

BASH: It does look like that's where it's going and she clearly knows that. But the second part of what she said about making sure that there is competition, making sure that costs are lowered and you put some restrictions and rules on the insurance company, that is going to be the carrot, I think, and that is going to be how the White House, if they do go down this road of not having a public option, a government-run insurance option initially, that is how they're going to potentially convince the liberals that it's OK, at least enough to get the votes, by saying look, here's what we're going to do.

We are going to make sure there are market reforms, intense, strict market reforms to force the kind of competition that we're looking for, to force the kind of lowering of health care costs that we're looking for.

And, you know, whether or not the president can get enough Democrats especially on the left to go for that, that is going to be the question about what you talked about earlier. His leadership, whether or not he can go into the Democratic Caucus in the House and which is where you have the most liberals and say, look, guys, this is it. This is all you're going to get. You have to take as one House Democrat said, half a loaf or three-quarters of a loaf or you're going to get nothing. KING: And Ed, as we address the question of trust because that's the president's biggest challenge when he goes before the Congress and the nation, say trust me, trust my ideas. I want you to listen to something Ben Nelson admittedly from a red state of Nebraska, a more conservative Democrat, and this is his assessment of the town halls.

(BEGIN VIDEO CLIP)

NELSON: What I found during the town halls is people wanted us to do nothing because they're afraid that whatever we did, they'd be worse off. They couldn't understand how they'd be better off and they were worried that something would be taken from them and given to someone else.

(END VIDEO CLIP)

KING: That mistrust, those doubts, Ed, I think you can summarize that at least so far, the perception that the president and his allies have failed to communicate in a compelling way or certainly in a louder and more convincing way than the opponents. What is the White House saying about making sure it's different this time?

HENRY: You're right. And that's what has emboldened Republicans to stand up to this president on this issue as well as conservative Democrats like Ben Nelson and not just go along. If you think back to the last time the president had a speech to a joint session of Congress in February, he was coming off the high of getting the stimulus legislation passed. He didn't get a lot of Republican support, but he still got a victory.

I think it's a much different chamber he will be walking into this Wednesday night because Republicans certainly are no longer scared of them if they ever were and conservative Democrats like Ben Nelson, the question is going to be whether or not they really fear this president anymore. His public standing has gone down a bit, not just because of health care but also some of these foreign policy issues like Afghanistan as well. So when you talk about trust, the White House, when you talk to senior aides, they realize he has got to push back pretty hard and he has to assert himself more than anything on Wednesday night to show he really is in charge, John.

BASH: But this is also, I think, a feeling that preceded. Go ahead.

KING: Go ahead.

BASH: I was just going say quickly, this is a feeling that preceded Barack Obama and this is something that has been I think pretty widespread for a long time, just an overall distrust of Washington and what government can and cannot do. The fact that you've already had big spending on a stimulus, big spending on a bailout, that is something that is added to the mistrust out there.

CROWLEY: John, just one thing about Wednesday night which I think will be interesting is what is the President Obama known for, this sort of soaring, inspirational rhetoric, and what he has to do Wednesday night is inspire with details. So this is sort of a double task for him, and I don't think we've seen him doing that sort of thing before, being both detailed and inspirational because he has to get people on his side and one of the ways he has to do it is by putting out here's specifically what I want.

KING: Very well put, Candy Crowley, Ed Henry, Dana Bash, stand by. We'll be right back with more questions about the big challenges facing the president and more live from the Minnesota State Fair when "State of the Union" continues in just a moment.

(COMMERCIAL BREAK)

KING: Live picture there of the CNN Express live at the Minnesota State Fair. We're back with CNN's Dana Bash, Ed Henry and Candy Crowley, and I want you all to know I'm bringing you souvenirs from the state fair. At the Republican booth, you can get this, "Change: I want mine back." The Republicans, of course, opposing the president's agenda. But you can go by the Democratic booth and you can find out everything you want to know about the Obama health care plan and other issues, we've got that.

And as it starts to move into fall, bacon balm. Everyone needs bacon balm, lip gloss made from bacon. I think not.

BASH: You can give that to Candy and Ed.

CROWLEY: As a vegetarian, I pass to Ed.

HENRY: Well, thank you.

KING: Let's turn -- let's turn it a bit more serious. One of the people we had join us a bit earlier was the Republican governor of this state, Tim Pawlenty, harshly critical of the president on issues like health care, on issues like the budget, on issues like the stimulus plan. But on Afghanistan, on a challenge facing the president to send more troops, the likely option the president will have on his desk in a matter of days, it's conservatives like George Will say it's time to get most U.S. troops out. Governor Tim Pawlenty said, no, that's wrong.

(BEGIN VIDEO CLIP)

PAWLENTY: The rule needs to be when the United States goes to war, the United States wins. And so we need to make sure we do those things to complete that mission successfully. That includes putting more troops into Afghanistan if needed.

(END VIDEO CLIP)

KING: Ed Henry, on top of everything else, health care, the economy, unemployment, the H1N1 which we'll get to in a minute, is the president going to send more troops to Afghanistan?

HENRY: He's going to be under heavy pressure from his commanders to do that. They have not made a final decision on that. He's already sent 21,000 more. It is going to be a very tough pill for his party to swallow for him to send more troops.

HENRY: I think it's likely in the end he'll have to, given the situation on the ground, but that's far from a certainty right now.

And I think when you talk to top Obama aides, what's most fascinating about this is they know that they're in a little bit of a box here because as a candidate, and in the early days as a president, Barack Obama said many times that Afghanistan is a war of necessity, not a war of choice.

He made a clear distinction from Iraq. So he's sort of in a box here now, because if he starts pulling out, he's going to have his own rhetoric to deal with. And Republicans, like Tim Pawlenty, are going to hold him to it.

So this is a lot different situation than Iraq and you've got people on the left like Russ Feingold saying, we need a timetable for withdrawal just like, Mr. President, you did on Iraq. So he's going to face some tough, tough choices here -- John.

KING: And so, Dana on Capitol Hill, are these two...

(CROSSTALK)

KING: Go ahead, jump in, guys.

CROWLEY: I'm sorry, John. I was just going to say, he wouldn't be the first president to redefine what victory is, if he needs to do it. And that this is one of those things that really does turn politics on its head, because despite declining support for Afghanistan, there's huge support among Republicans and huge opposition among Democrats. So it's an interesting position he finds himself in.

KING: And so, Dana, do they view these as two distinct things on Capitol Hill, or if liberals are mad about Afghanistan, does that trickle into other debates like health care?

BASH: Well, I think that they would like to view them as two distinct things, but there is no question that if, if in fact, the president does have to drop a public option, a government-run health care option for health care, which liberals say is the only way to reform the health care system, and they -- and the president does increase troops in Afghanistan, which many liberals say is absolutely the wrong thing to do, there's no way that is not going to be seen as a double whammy, if you will, for the president, from the perspective of his liberal base. And, you know, there are a lot of liberals out there who were waiting a long time for a Democratic president and there are many who are going to be disappointed.

However, you know, the reality is that the president -- just as Ed said, the president did make a promise and did push forward on Afghanistan as the place that the United States really does need to step it up and deal with what had been a forgotten war.

So it shouldn't be a surprise to liberals in his party that this is the way he will head, if in fact he makes that decision.

KING: All right. We're going to call a time-out here. When we come back though, the "Lightning Round" with our reporters. I give them two questions. They get two sentences or so to answer. The winner of the "Lightning Round" gets gopher, a Minnesota gopher, live from the state fair. Stay with us. STATE OF THE UNION will be right back.

(COMMERCIAL BREAK)

KING: Back now for our "Lightning Round." We're live at the Minnesota State Fair. The "Lightning Round" with Candy Crowley, Ed Henry, and Dana Bash. Let me set it up, ladies and gentleman. Here is the front page of The Star-Tribune this Sunday here in Minnesota, "Facing Hard Times," a story about the top economy here in the state and, of course, across the country.

"From sound and fury to the real fight, the health care debate coming in Congress." Two of the big challenges facing the president. And as his approval ratings go down, some columnists are beginning to say that he has fallen back to earth.

Here is Charles Krauthammer, as we begin the "Lightning Round." Charles Krauthammer writing in The Washington Post on Friday: "What happened to President Obama? His wax wings having melted, he is the man who fell to earth. For a man who only recently bred a cult, ordinariness is a great burden. And for his acolytes, a crushing disappointment, Obama has become a politician, like others."

Ed Henry, I'm assuming they don't like the Icarus analogy over at the White House.

(LAUGHTER)

HENRY: Oh, they clearly don't. And there is clearly one solution to all of this. He needs to get wee-wee'd up. As he said a couple of weeks ago, nobody knew what that meant. And I still don't quite know what it is. He accused Republicans in Washington of getting all wee-wee'd up. I think he needs to do that.

And what it probably means is, he needs to get fired up, he needs to go at it, be a little more aggressive. It's looking right now like he's a little passive watching all of this go by. So he needs to get wee-wee'd up.

KING: Somebody jump in there.

CROWLEY: Oh, wait, listen, I think that you can overstate how much trouble or not trouble President Obama is in. There are some polls that have him around 55. There's no poll that has him under 50, so I think this can be overstated. I think a nice win or something that they can call a win when it comes to health care, especially if it deals with insurance companies -- which everybody seems to want to do, saying to insurance companies, listen, you have to cover people, you cannot reject people, and other things. I think if he does that and he has a bill that says health care on the top of it and signs it at the end of the year, he's going to look back and see a pretty good year. There's nothing wrong with a 53 percent approval rating.

BASH: I spent some time this week with an undecided House Democrat who said that he thinks that the president has got to drop his calm, his cool, cerebral approach to things. He has got to get passionate and he has got to do what LBJ did in 1964 to get the Civil Rights Act passed. He has got to roll up his sleeves, cut a deal, and not be afraid to make some people in his own party angry. He has got to lead.

KING: All right. Now I'm not sure what wee-wee'd up is either, but I bet here at the state fair you can get it on a stick.

(LAUGHTER)

KING: I want to show you, we had Tim Pawlenty on this show earlier. He might be running for president, but Bob Dole, Bob Dole, the former Republican majority leader, the former presidential candidate, Bob Dole has another idea when it comes to 2012, General David Petraeus.

(BEGIN VIDEO CLIP)

BOB DOLE (R), FORMER SENATE MAJORITY LEADER: He has always impressed me as being very candid with the American people, laying it all out there, kind of an Eisenhower. You know, he kind of -- he may not be versed in all of the different things that we do in Congress and the administration, but he's a quick study.

STEPHANOPOULOS: So you'd like to see him on the ticket for the Republicans?

DOLE: Sure. Why not? Maybe I can run with him.

(LAUGHTER)

(END VIDEO CLIP)

KING: All right. You get two words each. We're almost out of time. Candy, you first. Real or not?

CROWLEY: Not real.

KING: Ed?

HENRY: No, you know, I think...

CROWLEY: You wanted two words.

HENRY: ... I'm leaning towards -- General Powell, General Clark, it didn't work out for them, not going to work out this time.

BASH: What's his health care plan? KING: Dana?

BASH: That's what I want to know.

KING: All right. A gopher for all of you. I'll bring back enough gophers for everybody from the Minnesota State Fair. Candy Crowley, Ed Henry, Dana Bash, thank you very much.

And we'd like to welcome back our international viewers. I'm John King, live at the Minnesota State Fair. And this is a special Labor Day weekend edition of STATE OF THE UNION.

(BEGIN VIDEOTAPE)

KING (voice-over): It is a big concern here at the state fair and at workplaces and schools across America. How big is the H1N1 risk and is the government ready?

OBAMA: I don't want anybody to be alarmed, but I do want everybody to be prepared.

KING: Plus, the health care flashpoints at the fairgrounds and back in Washington, as the president prepares for a high-stakes address to joint session of Congress. Time for a deal or more partisan gridlock? We put your questions to key voices.

KING: Democratic Senators Amy Klobuchar and Ben Nelson, Minnesota's Republican Governor Tim Pawlenty and the director for the Centers of Disease Control, Dr. Thomas Frieden.

Then our American dispatch from Waterloo, Wisconsin. A dairy farmer who relies on cooperatives for feed, seed, and now his health care says reform doesn't have to mean more government spending. And a congressman leading the fight for a public health care option. Minnesota Democrat Keith Ellison gets "The Last Word."

This is the "State of the Union" report for Sunday, September 6th.

(END VIDEO CLIP)

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