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STATE OF THE UNION WITH CANDY CROWLEY

Interview With Senator Durbin; Interview With Congresswomen Blackburn, McMorris Rodgers; Interview With Senator Lieberman

Aired September 26, 2010 - 09:00   ET

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


CANDY CROWLEY, HOST: This week, the frustrated faithful confront the man of their dreams at a town hall meeting.

(BEGIN VIDEO CLIP)

VELMA HART: Quite frankly, I'm exhausted. I'm exhausted of defending you, defending your administration, defending the mantle of change that I voted for.

UNIDENTIFIED MALE: We have felt like a pinata. Maybe you don't feel like you're whacking us with a stick, but we certainly feel like we've been whacked with a stick.

UNIDENTIFIED MALE: I was really inspired by you and your campaign and the message that you brought. And that inspiration's dying away. It feels like the American dream is not attainable.

(END VIDEO CLIP)

CROWLEY: As the president and his party battle the political headwinds, Republicans tried to shake off the Bush years. This week, the GOP House hierarchy unveiled a Pledge to America, a glossy 21-page manifesto of what the public agenda would look like if Republicans return to the helm.

In politics where perception can mold reality, Democrats are flooding the zone with private polling showing dozens of difficult races still within their reach. It is not over yet.

(BEGIN VIDEOTAPE)

CROWLEY: Today, 37 days to the election.

DURBIN: Many of these races are going to get a lot closer, and it's going to be a late night.

CROWLEY: We are joined by the Senate's number-two Democrat, Dick Durbin, and one of the Senate's two independents, Joe Lieberman. Then --

(UNKNOWN): We will return to the principles that have made this nation great.

CROWLEY: Two senior Republican congresswomen on the Pledge to America. Marsha Blackburn and Cathy McMorris Rodgers.

I'm Candy Crowley, and this is "State of the Union."

(END VIDEOTAPE)

CROWLEY: We learned this week that technically, the recession ended over a year ago, June of 2009. But Americans do not live on technicalities. Reality is different. In the latest CNN poll, 74 percent of Americans said the economy is in a recession. 61 percent said President Obama's policies have made the economy worse. Just 36 percent said he has made things better.

Before the president faces voters again, there's time for the economy to turn around, time for him to win back the faithful. But the calendar is running out on Capitol Hill Democrats, who are facing dreary predictions and an election just a little over seven weeks away. Joining me now from Chicago, the majority whip in the U.S. Senate, Senator Dick Durbin. Thank you so much for joining us, Senator, from the beautiful city of Chicago, I should add.

DURBIN: It's great to be with you, Candy. Thank you.

CROWLEY: The man that you see now out talking at these town hall meetings and to these crowds, is that the same person you saw connecting with voters during the campaign?

DURBIN: Well, it is. With the same talents and the same values and the same determination. You know, there were dark days in that presidential campaign. I remember them. I was with then-Senator Barack Obama. And this man has a determination and an energy that comes into play if those moments, and you're seeing it now.

Candy, one of the key polls that we watch is the generic congressional race. Do you prefer a Democratic Congress or a Republican Congress? In an off-year election, it should be pretty strong on the Republican side. But did you notice what happened in the Gallup poll in the first 19 days of September? When the president was out working hard, as our candidates are working hard, the Republicans enjoy a one-point advantage nationwide. That's why they came out with this so-called Pledge for America.

CROWLEY: And I think a lot of people sort of argue with the generic poll, saying, well, that's a nationwide take, but it's not district by district. And when you hone in on those districts, it does show you all in trouble.

But I want to ask you another question about the president. The reason I ask is, the people that he's now facing are supporters. What happened? If the president hasn't changed, a lot of people complaining he's lost his ability to connect with voters, what has changed to turn these people away?

DURBIN: Well, I think what happened was the president, of course, promised change, and he believed that if he came to Washington and in good faith said to the Republicans, join me, we can compromise, we can solve our problems, that that would happen. Instead, the Republicans in Congress took this filibuster strategy in the Senate and said we will just not cooperate with the president on anything. No votes when it came to turning the recession around. Very few votes when it came to the whole question of health care reform. When it came to Wall Street reform, they just stood steadfast.

We were lucky in the Senate to get one, two, or three senators on the Republican side to join us. And I think that is what slowed the president down and slowed us down.

But we have still achieved some dramatic positive change. CROWLEY: Well, in fact, you passed all of those--

DURBIN: I would say this, the Republicans --

CROWLEY: Go ahead, I'm sorry. Go ahead, finish your thought.

DURBIN: I would just say, finish the thought by saying the president set out with the right agenda, with the right goals and believed he could do it in a bipartisan fashion. The Republican approach was filibuster, say no, try your best to defeat the president. And so there is some frustration.

CROWLEY: So absolutely no culpability on the part of Democrats or the White House. This is all the Republicans' fault that people are turning away from President Obama?

DURBIN: No, I'm never going to say that. And that would be naive to say that. We could have done some things better, but look where we are today. If we had not moved forward with a recovery plan, we would be in a deeper recession, maybe even a depression. Now, what does the Republican Pledge for America say? That is the original job killer strategy. They want to return to the Bush economic policies, policies that doubled the national debt and drove us into this recession. And they just proudly announced they want to return to them. Now we have a clear debate in this election, a clear difference, and that's what elections are about, choices. And the choices I think are very stark.

CROWLEY: I want to tell you about a poll that we found sort of interesting. This, again, from the CNN Opinion Research poll we took about mid-September. And we asked people their opinions of the views and policies of various groups, the Republican Party, the Democratic Party, and the Tea Party movement. 43 percent found the Tea Party movement too extreme; 42 percent found the Democratic Party too extreme. What accounts for that?

DURBIN: Well, it shows you what's happening in our country, unfortunately, in that people are hardening their positions on both ends of the spectrum. But there is some other polling data that I think we ought to look at. If you ask the American people what's the number-one issue in this election, jobs. And then you say, which party do you trust when it comes to jobs and unemployment the most? The Democrats have a 13-point lead over the Republicans. The Republicans, while asking for tax cuts for the wealthy, have refused time and again to give unemployment benefits to those who have lost their job through no fault of their on. So on the basic core, major issue, Democrats are in a strong position.

Let's say a word about the Tea Party. When the Tea Party becomes the gatekeeper of a Republican primary, we end up with contests we never dreamed of. Who would have guessed that today we would be taking an honest look at Alaska, Delaware, and Kentucky, where we clearly have races where the Democrats can win? Or Florida, which is in turmoil because of the Tea Party.

I think that shows the Tea Party position is too extreme for most voters. And I think we're going to do well in those states.

CROWLEY: Let me ask you about some governance here. The president has an opening. Larry Summers is leaving, director of the National Economic Council. What kind of person should the president put in that job, his top economic adviser?

DURBIN: Well, he needs to bring a person in that job who really understands that creating jobs in America is our highest priority. And let me tell you, one of the president's planks in this platform and running is one we're taking to the floor of the Senate this week. It's a question about whether we will change the tax code so we stop rewarding American companies that ship jobs overseas.

I want to make sure that good, patriotic American corporations, who keep jobs here in America, with good wages and good benefits, are rewarded and we don't create incentives to send jobs overseas. The Republicans consistently vote against us. That's an issue we want to take into this election. I hope that they'll break ranks and join us this week in closing these tax loopholes that help these companies ship jobs overseas, and I hope the president's advisers and team will be working hard on that issue.

CROWLEY: Let me just follow up on that last question, and that is, do you think because the president has this -- there's a feeling in the business community that the president is anti-business. Would it help him to put someone in there with some real world experience in business? The rap has been he's got a lot of academics in there, but no one that totally understands business. Would you like to see that?

DURBIN: Well, of course, I want someone who's balanced, who can work with business and work with working people and labor unions, someone who really sees the whole picture.

But let me step back for a second and say, some of the criticism coming from the business community is coming from the Wall Street financial firms, which took the federal bailout funds and sent a thank-you letter to Washington in terms of bonuses for the people who guided their corporations and banks into their disastrous policies. So I don't have a lot of sympathy for their antipathy towards the president. The president did what he need to do, and Congress did, too, with Wall Street financial reform. And again, the Republicans opposed us when we said that we wanted to make sure we never go through a bailout again, we don't want to go down this path again, where these large corporation abuse their practices and lead us into a recession. CROWLEY: Stick with me a minute here, Senator Durbin, who will be with us right after this break when we talk about why Democrats are waiting until after the election to vote on extending the Bush tax cuts.

(COMMERCIAL BREAK)

CROWLEY: By September of an election year, the House and Senate floors are basically extensions of the campaign trail. Thursday, Senate Democrats postponed until after the election a vote on extending Bush-era tax cuts due to expire at the end of the year. Some Democrats in dicey elections worry the debate might hurt them back home, and Republicans want extensions for all tax-payers, not just the middle class.

In short, the Democratic leadership didn't have the 60 votes needed to break a filibuster. Ditto for the following list of items near and dear to the Democratic base: the DISCLOSE Act, a campaign finance reform bill to undo a Supreme Court ruling which lifted spending restrictions on political ads from corporations and unions, one vote short; the repeal of "Don't Ask/Don't Tell," the policy which prohibits gays and lesbians from serving openly in the U.S. military, four votes short; so was the DREAM Act, which would put children brought to the U.S. illegally on the path to citizenship if they spend two years serving in the military or attending college.

All of these bills are important to Democratic constituencies, but postponing the vote on extending Bush tax cuts to the middle class, also likely to be delayed in the House, seemed to hit a raw nerve with liberals.

New York Times columnist Paul Krugman wrote: "I guess the Blue Dogs really want to be in the minority." The Bush tax cuts and more with Senator Dick Durbin, next.

(COMMERCIAL BREAK)

CROWLEY: We are back with Democratic Majority Whip Senator Dick Durbin.

Senator, let's talk about the decision in the Senate to postpone the tax cut extensions until after the elections in a lame duck session. Congressman Boehner, the top Republican in the House, has said, if Congress leaves without acting on those tax cuts, it's the most irresponsible thing he has seen in quite a while. Why do you think you're not going to take flak back home for not acting on these tax cuts?

DURBIN: Well, first, a word about John Boehner. It wasn't that long ago on a Sunday show that he said he would accept the Democratic compromise. He got beaten up so badly by the right-wing of his party he recanted that position the next day.

But we know where the Democrats and Republicans stand when it comes to tax cuts. The president has articulated the position the vast majority of Democrats in the Senate and the House support. And that is that we would extend the tax cuts for those who make $250,000 a year or less. That is I think a sensible thing to do to help the middle class in America, bring us out of this recession, but not to make the deficit dramatically worse. What's the Republicans position?

CROWLEY: Sure, I mean, we understand sort of the positions that the Republicans want the extensions to also go to the wealthy. That the Democrats by and large want them just to go to the middle class. But the question is, why go and delay this until after the elections? Put it up to a vote, do it now.

DURBIN: Candy, I can count and I know you can, too. We have 59 Democrats and not a single Republican in the Senate supports our position that we need to do something that's responsible to reduce our deficit, but also to help middle-income families, bring us out of this recession. Look at the two major issues.

CROWLEY: Why will that be different after the election?

DURBIN: Well, I hope it will be different. Occasionally one Republican will break ranks and help us. Let me give an example. Tomorrow, President Obama is going to sign the small business credit bill to help create jobs in small businesses all across America.

We had one Republican after a month, a solid month of filibustering, George Voinovich of Ohio, retiring Republican, said, I'm tired of the game-playing here, I'm going to vote with the Democrats to help small businesses. That's what it took, a whole month.

And now we have a food safety bill I've been working on for over a year, 19 Democrats and Republicans support it, one Republican, Tom Coburn, a medical doctor from Oklahoma, has stopped the food safety bill. Another filibuster.

You know, what it gets down to is we can count and we know we don't have 60 votes for our tax position. We want to basically say after the election when we still face a deadline, by the end of the year we'll take up all of these tax issues. That to me is the only realistic way to address it.

CROWLEY: You don't have all of the Democratic votes in the Senate either, do you?

DURBIN: Well, here's what I think, Some Democrats would say, well, perhaps we would do it a little bit differently. But if that position doesn't prevail, and I don't think it will, then the ultimate choice is going to be whether or not we have the $250,000 income threshold for these tax cuts. And I think at that time we'll have the support of all the Democrats as well as some Republicans.

CROWLEY: In our remaining couple of minutes, let's talk some good, solid politics. You talked about openings you now see in Alaska, Delaware, Kentucky, and Nevada. What's the risk you're underestimating the tea party's strength?

DURBIN: Well, I can tell you the tea party's strength. Let's look at the state of Delaware. Politico did a survey after Ms. O'Donnell won the primary. Sixty percent of the voters in Delaware said she was unqualified to be a United States senator.

Take a look at the situation in Alaska. Lisa Murkowski has decided to run a write-in campaign against Mr. Miller, who won on the -- under the tea party banner. And now our candidate, McAdam, has a fighting chance to be the new senator from Alaska. The same thing is true when you look around at Florida.

This was supposed to be a runaway for Rubin, but I will tell you, as the votes start coming down, it's not as clear. So the message is this, when the tea party serves as the gatekeeper for the Republican Party, the most extreme candidates win.

DURBIN: And then people have to ask themselves, is this what we really want in the United States Senate, whether it's in Nevada or in Alaska or in Delaware?

We have a chance in those states, and more than a chance in Nevada, where Harry Reid is ahead and is going to win.

CROWLEY: Two quick questions for you, Senator. Define a good election night for Democrats this November. What does that mean to you?

DURBIN: Off-year elections are rarely kind to the incumbent president. If we maintain, and I believe we will, our majorities in the Senate and in the House, working majorities that we can work with this president to solve the problems of this country, it will be a good election night.

CROWLEY: And finally, just a little local question for you. The president may also lose his chief of staff. So I was wondering how Chicago Mayor Rahm Emanuel sounds to you.

DURBIN: I can tell you that, as you walk down Michigan Avenue in Chicago, you bump into at least two or three wannabe candidates for mayor. It is so rare that the Daley opportunity is gone and he is retiring after a wonderful service as our mayor. And now we have an opening here that you have candidates from all over the city announcing their interest.

I'm not kidding. There have got to be 10 or 20 viable names that are out there. And I have said publicly to Rahm Emanuel, if you want to run, you can't do it from the White House. You need do it from the loop in Chicago.

CROWLEY: No endorsement today, though?

DURBIN: No.

(LAUGHTER)

CROWLEY: Thanks so much. Senator Dick Durbin, we appreciate the time.

DURBIN: Thank you, Candy.

CROWLEY: Up next, the Republicans' Pledge to America. I'll talk to two GOP congresswomen who believe their party is poised to take back Washington.

(COMMERCIAL BREAK)

CROWLEY: This week, House Republicans rolled out an agenda of sorts, an attempt to show conservative voters they are serious about separating from the big-spending Bush years and an answer to Democrats' charge that Republicans have nothing to offer but no.

In a world where optics mean a lot, GOP leadership types went to a lumber company in Virginia. They wore un-Washington clothes and spoke from a podium sandwiched between piles of wood.

The anti-Washington tone was struck about 30 miles from the nation's capital. The picture was different but the concepts familiar. The 21-page pledge includes calls for repealing and replacing health care reform and making the Bush tax cuts permanent for everyone. It would also freeze the hiring of federal employees in non-security jobs and roll back spending to 2008 levels, before the stimulus bill, before the bank bailout.

The pledge was largely free of pronouncements on the social issues, the kind of talk that tends to scare off independent voters. And there was little about what Republicans would do about popular but unsustainable entitlement programs like Social Security and Medicare; no mention of earmarks, either.

Republican Congresswomen Marsha Blackburn and Cathy McMorris Rodgers next, on the pledge.

(COMMERCIAL BREAK)

CROWLEY: First, a news note, as you rejoin us. For those of you who are following the Pastor Long story, we continue to monitor his sermon and we will give you an update later on in the show.

Joining me now, though, Republican Congresswoman Marsha Blackburn of Tennessee and Cathy McMorris Rodgers of Washington. Thank you all so much for coming.

I want to start out by reading for you something that was said from an executive, the Club For Growth, a conservative organization particularly concerned with government spending. And this is about the pledge to America.

"It's so milquetoast that it proves to me that these guys just aren't ready to lead in order to prevent a return of the big-spending Republican ways during the Bush years. The House GOP needs to institute two things that will force them to behave: getting rid of the earmarks and enacting a balanced budget amendment or a spending limit amendment. This new pledge was silent on both. Therefore, the pledge has new teeth." So first to you, Congresswoman Blackburn. Why isn't there anything about a balanced budget in this? Why isn't there an end to earmarks in this? BLACKBURN: Well, two things to answer it, Candy. And I appreciate the conversation that is taking place across the country about the pledge.

Number one, in the preamble, we say, put us on a pathway to a balanced budget. And that is so important. You know, you have to take those first steps. The pledge is a first step.

When it comes to earmarks, we took that action earlier. We made certain earlier in the year that we put in place that one-year moratorium on earmarks. I'm one of those that has taken that pledge.

But, more importantly, I think what you're going to see -- and as we talk about the federal spending in our pledge, most of those candidates that -- and most of those members of Congress who have been big earmarkers are finding out from the electorate those days are over. Earmarks are going to be a thing of the past.

CROWLEY: Congresswoman Rodgers, let me ask you, point for me in this document some place where it says, "We Republicans get why you threw us out in 2006 and 2008, and here's why we're different now."

CROWLEY: Where is that provision?

RODGERS: Well, I just think that the fact that we have this pledge, it is positive, it's constructive. And the Republicans did lose their way. They were spending too much, and we're recognizing that. And in this pledge, we say that we're -- this is a pact to get us to a balanced budget, a pact to actually address some of the deficit, start paying down the deficit, which had never happened under Republicans or Democrats.

And we're going back to pre-TARP, pre-stimulus spending levels, and saying, you know what, we need to get our fiscal house in order. And we're very much making a commitment to do that. And it was developed after engaging hundreds of thousands of Americans all across this country. So it's ideas and principles that people from all across this country have brought to us.

CROWLEY: Congresswoman Blackburn, can you cure what ails the U.S. economy without taking on entitlements, which also are not addressed in this pledge? Nothing about Medicare, nothing about Social Security. Can you really do anything about the economy unless you look at those, as well?

BLACKBURN: Candy, one of the things we have to realize is the document that is in front of us, the pledge, is for the here and now. These are things that could have been -- they could be done right now before the November elections, and they should be done, to give some certainty.

And yes, what we do is roll the spending back, cap it, freeze the federal hiring, and then start working our way through. You know, what the American people have told us as we have listened to them, spent months listening to them, and developed this document is, look, show us what is going to be the pathway to a balanced budget. Show us how we're going to be able to get this debt under control because it has skyrocketed, absolutely skyrocketed in the past three years.

And then let's sit down and have a discussion, an adult discussion between the tax-payers, between our elected representatives of how we address entitlements and how we make certain that the commitments that are there on Medicare and on Social Security are going to be kept.

We have to remember that money, the Medicare money, the Social Security money, people have had that coming out of their paycheck all their working lives. It is their money. CROWLEY: Look, you know, the bottom line here is, it looked like you all dodged the tough stuff. You know, nothing about entitlements, nothing about a balanced budget. If you want a balanced budget, why not a constitutional amendment for a balanced budget? Looks like you sidestepped the tough stuff.

RODGERS: Absolutely not. This is a document -- a governing document for today. These are -- these are plans that -- these are positive, constructive solutions for the issues of the day that we'd like to see brought forward in Congress. Whether it's related to economic recovery, creating jobs, getting our fiscal house in order, changing the way government does business, this isn't the Republican platform. This isn't everything the Republicans want to accomplish.

These are the first steps. These are priority issues that we believe need to be addressed today. And we can very much take on a balanced budget amendment at a different time.

CROWLEY: Let me -- I want to play for you both something else that -- now this was before you all rolled out the pledge. But I want to play you something that Congressman Pence said recently.

(BEGIN VIDEO CLIP)

REP. MIKE PENCE (R), INDIANA: We must not remain silent when great moral battles are being waged. We must demand here and now that the leaders of the Republican Party stand for life, traditional marriage, and religious liberty without apology.

(END VIDEO CLIP)

CROWLEY: Congresswoman Blackburn, we all know that in attempts to reach out to independents, they tend to get very skittish about the social issues. They are far more interested in day-to-day life and the economy. Nonetheless, the Republican Party, one of its core values, has always been the -- kind of the social issues. Very little mention of social issues in this manifesto which, again, looks political.

Why not get out there and say, here's what else we stand for, we're against gay marriage, we -- we don't believe in abortion? Why not do that?

BLACKBURN: Well, in the preamble, we do that. We reaffirm our commitment to conservative values.

And, Candy, bear in mind, what we have done for the past several month, I started my listening sessions last January. And what we have done is listened to the American people, and they've said -- we've said to them, tell us what is most pressing, what you want the focus to be, what are your priorities?

And we have heard it time and again: deal with the economy, where are the jobs, we want jobs, we want to make certain that you're creating the environment for jobs to be created and get out of the way, let the private sector work, repeal the health care bill, secure our nation, make certain that the government is more transparent.

Those are the type changes that the American people have repeatedly said in hundreds of listening sessions, thousands of constituents participating, millions participating in You Cut and americaspeakingout.com. They have let us know what their priorities are, and it is the economic issues, fixing the health care bill, having government transparency, checks and balances, and making certain that this nation is safe.

We have made that commitment and the pledge to the American people. We hope they're going to hold us accountable to do the things that are on this list and then let's add more to it. Let's make certain that we repeal some of these bills, get them off the books. Free up free enterprise, let jobs growth take place. Make certain no American sees a tax hike when January 1, 2011, rolls around.

Don't raise those taxes, provide certainty for our business community and our small businesses. Let them know what's out there. So those are the items the American people want to see. We have given them a good first step, and we are ready to get to work. We are in this fight.

CROWLEY: Let me pick up on one of those things. And that is, a repeal and replace of health care reform. Just this past week we saw a couple of the provisions of the health care reform bill go into effect. One of them was to allow children up to the age of 26 to remain on their parents' insurance should they need to. The other was to make sure that children with pre-existing conditions could still get insurance. You want to repeal both of those?

RODGERS: We would -- in our package, in our health care reform proposal, we include both of those provisions. So, yes, we believe that the health care bill needs to be repealed and replaced with better reforms that will actually reduce costs and make sure that people have access.

But in our -- in our plan, it does include the provision to cover those with pre-existing conditions, raising the age to 26 for children. That is not -- that is supported by Republicans and Democrats.

However, Republicans believe that there's more that could be done to actually reduce the cost of health care and that we need to have that debate. We need to enact tort reform, medical liability reform. We need to allow small businesses to pool together and access more affordable plans beyond state boundaries. And some of those kind of reforms will go a long way towards bringing down the costs.

And right now we're seeing premiums increase. Small businesses all across this country are seeing 10 percent, 20 percent increases in their health care premiums at the exact worst time. And so we -- we believe that we need to start all over, have a debate, bring Republicans and Democrats together with the best ideas. Let's move those forward, and we can do it in a better way.

CROWLEY: Congresswoman Cathy McMorris Rodgers, Congresswoman Marsha Blackburn, I could go on forever about this. I'm afraid I have to cut it short. Thank you so much for joining us, I really appreciate it.

RODGERS: You too.

BLACKBURN: Good to be with you, thank you.

CROWLEY: Up next, we'll get an independent's take on the political climate in Washington, homeland security, and Afghanistan, from Senator Joe Lieberman of Connecticut.

(COMMERCIAL BREAK)

CROWLEY: Joining me now here in Washington, independent Senator Joe Lieberman of Connecticut. Thanks for being here, Senator.

LIEBERMAN: Thank you.

CROWLEY: I want to try and wrap up this tax cut discussion here.

LIEBERMAN: OK.

CROWLEY: And that is, what's going to happen here?

LIEBERMAN: Well, I think, when we come back in November or December, first thing is we've got to extend these tax cuts. If we don't do anything, everybody's taxes go up in January.

CROWLEY: Is that a possibility?

LIEBERMAN: It is a possibility, and to me, it's the surest way to send America back into a second dip of a recession, which nobody want wants. So we've got to find a way to break through this partisan gridlock again and come to a compromise.

And my guess is that the probability is that we will extend the so-called middle-class tax cuts permanently, so to speak. And we will agree to extend the tax cuts on high-income earners for at least a year or two. I hope we can do that. I think that's good for -- I favor that. I think that, you know, it's easy enough to say that people who make a lot of money don't -- don't deserve a tax cut now, but the truth is, if you have more money, you spend more money, you invest more money. That's what we need to happen now to grow jobs in our economy. CROWLEY: You voted against the Bush tax cuts twice, saying, look, the deficit can't afford this; we as a country can't afford this. And now you're for extending them. Could you square that for me?

LIEBERMAN: Yes, glad to -- different circumstances. I mean, I was for a lot of the parts of the Bush tax cuts, all the middle-class tax cuts. I've always been for lower capital gains, dividends taxes.

But when you put the package all together, which is the way they -- they put it before us in the Senate, it was creating a big deficit. And I felt, because by 2003, we were into the war in Iraq, that we ought to pay for that war.

Also, the economy was in pretty good shape then. Today we're coming out of the worst recession since the Great Depression. We're struggling to get out of it. One out of 10 Americans out of work, one out of seven Americans living in poverty -- I don't think this is the time to raise anybody's taxes, including those who are wealthiest. We need them out there spending their money, investing it instead of paying it to the federal government.

CROWLEY: Looking back at this past week, where the Democratic leadership failed to get cloture; that is, cut off a possible filibuster for a defense appropriations bill for these tax cuts -- they didn't even attempt to do it. Can we look back at this week and see about anything other than politics? This wasn't about legislating, was it?

LIEBERMAN: Well, there were some good legislative ambitions or intentions there. I mean, I'm on the Armed Services Committee. We need to pass the defense bill to give the benefits to the -- our fighting men and women in the military that they need. Obviously, "Don't ask, don't tell," which I'm strongly for, is politically controversial.

So in a September session, it's hard to separate anything you do from politics. And the politics ultimately triumphed. We didn't get much of anything done. And that's why I think, ultimately, members of the Senate have decided the best thing to do is go home, particularly those who are running.

And I think that's why the tax vote was put off, too, because it was basically going to be another show with people on both sides, Republican and Democrats, knowing that nothing was really going to get done. We've got to come back and, hopefully after the election, put the parties' interest after the public interest, the country's interest, the interest in creating jobs again.

CROWLEY: Let me play you something that a colleague of yours, Republican Lindsey Graham, said recently. He is talking about homeland security and the U.S. fight against terrorism.

LIEBERMAN: OK.

(BEGIN VIDEO CLIP) SEN. LINDSEY GRAHAM, R-S.C.: We just keep punting on the hard, difficult issues surrounding Guantanamo Bay and the -- the war on terror in general.

Congress has been AWOL. Democrats are scared to death to talk about this. And most Republicans just demagogue.

(END VIDEO CLIP)

CROWLEY: Is he right?

LIEBERMAN: Well, that's good Lindsey Graham straight talk. I mean, Lindsey has a -- a unique position in the Republican Party. He actually is in favor of closing Guantanamo, which agrees with what President Obama wants to do. I don't agree with that. But he want changes in the legal way we handle people we apprehend in the war on terrorism.

CROWLEY: So why hasn't it been done? I don't...

LIEBERMAN: For exactly the reasons that Lindsey says. I think the administration has recognized that it simply does not have the votes to close Guantanamo and bring those people suspected of being part of the war on terrorism against us to the continental -- to the United States.

The Republicans don't have the votes to pass some of the tougher anti-terrorist measures that they'd like over the president's veto. For instance, I feel very strongly, when you apprehend a terrorist -- the Christmas Day bomber is an example -- that person by his acts has declared himself to be a soldier in a fanatical army aimed at killing Americans, and he shouldn't have gone to a federal district court. He should have gone to the military and been tried before a military commission.

CROWLEY: As a result of not having a firm framework for how to handle these suspects, how to interrogate these suspects, as well as what to do about the Guantanamo Bay prisoners, are we less safe?

LIEBERMAN: Well, we found other ways to be safe. But I do think it's a mistake to let people who would consider committing terrorist acts against the United States here at home -- and the number of those attempts, as we know, has gone up -- to think that, if they're apprehended, they're going to be sent to a federal court, have the right to have a counsel and all the rest, instead of going to a military prison.

So I worry about the message we send by that. But we're doing a lot of other things to keep our country safe. And so far we -- we have succeeded in doing that.

CROWLEY: And Bob Woodward has a new book out talking a lot about the run-up to the surge, if you will, in Afghanistan. One of the things that came out of it was that a number of people believe that President Karzai is bipolar, sometimes called manic-depressive. We now have that on top of a second really fraudulent election over there in Afghanistan.

Does the U.S. really have a reliable partner in Hamid Karzai?

LIEBERMAN: Yes, I think we do. I mean...

CROWLEY: Really? Why would you think that?

LIEBERMAN: President Karzai has a first responsibility to the people of Afghanistan. And he's operating not in a vacuum but in the context of the political realities there, and frankly in the context of the history, not so distant history when the United States, after the Russians pulled out of Afghanistan, also left. So there's a fear about how long we're going to stay. I think we try very hard to convince them, which we should, that we're committed to the fight; we're committed to Afghanistan's security.

But, remember, this is not a choice between the current government of Afghanistan and a perfect Afghan government. It's a choice between the current government in Afghanistan and the Taliban, the fanatical Islamist extremists, depriver of right to women and children and all the rest.

And so -- and that choice is simple. We ought to go with Karzai. General Petraeus, I think, is improving our relations with President Karzai. I think we're doing much better on the ground militarily than we have in the past, and I feel very strongly that we cannot afford to lose in Afghanistan. It will compromise our security here at home because that's what they used as a base, as we all know, when they attacked us on 9/11. I think we're going to succeed in Afghanistan.

CROWLEY: Senator Joseph Lieberman, thank you for joining us. Appreciate it.

LIEBERMAN: Thank you.

CROWLEY: Up next, a check of today's top headlines. Then we'll spell out the finer points of politics.

(COMMERCIAL BREAK)

CROWLEY: Time for a check of today's top story. Prominent Georgia Pastor Eddie Long told his congregation this morning he will fight the allegations of sexual abuse.

(BEGIN VIDEO CLIP)

BISHOP EDDIE LONG, NEW BIRTH BAPTIST CHURCH: There have been allegations and attacks made on me. I have never in my life portrayed myself as a perfect man. But I am not the man that's being portrayed on the television.

(CHEERING AND APPLAUSE)

LONG: That's not me. That is not me.

(END VIDEO CLIP) CROWLEY: Four young men filed lawsuits against Bishop Eddie Long this week, claiming he coerced them into sexual relationships. Long will address the media at a press conference scheduled for 10:00 a.m. Eastern. CNN will carry it live.

An improvised explosive device killed two NATO service members in southern Afghanistan today. Officials did not say who was responsible for the attack. This year is already the deadliest of the war with more than 530 coalition forces killed.

A contentious issue between Israelis and Palestinians is set to reach an important deadline today. Israel's moratorium on settlement construction in the West Bank expires at midnight. The Palestinians say new building could derail peace talks. Israeli Prime Minister Benjamin Netanyahu has said the 10-month-old curbs on new settlement construction will not be extended despite appeals from President Obama.

Those are your top stories here on STATE OF THE UNION. Up next, do you know how to spell Murkowski? You may be surprised to know who didn't.

(COMMERCIAL BREAK)

CROWLEY: You may recall last week's interview with Senator Lisa Murkowski, who is going to run for re-election as a write-in candidate because she got beat in the Republican primary by a tea party candidate. There hasn't been a successful write-in Senate candidate since the run of the late Senator Strom Thurmond in the '50s. Alaska is particularly rough terrain since state election law seems to require the name be spelled correctly, and frankly, Murkowski ain't Smith.

(BEGIN VIDEO CLIP)

SEN. LISA MURKOWSKI (R), ALASKA: Winning a write-in campaign is going to be tough. But don't you tell Alaskans we can't do tough things. You don't think we can't fill in an oval and learn to spell Lisa Murkowski. We can figure this out.

(END VIDEO CLIP)

CROWLEY: Her campaign's first attempt to spell the candidate's way to victory was, let's call it A-W-K-W-A-R-D.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Today we are going to learn to vote for Lisa Murkowski.

(END VIDEO CLIP)

CROWLEY: The title of the original ad was "vote Lisa M-U-R-K-O- W-S-K-I," helpfully, at the bottom of the ad, viewers were invited to visit "Lisa M-u-r-k-w-s-k-i.com," oh, my. It has been corrected and redone, but not until after the blogosphere had a good laugh. The campaign is laughing too. But that may be the just relief, because it now seems state election officials may accept alternate spellings of Murkowski on the ballot if the intent it obvious.

To be bipartisan about this snark, not even the finely-tuned machine over on Pennsylvania Avenue is immune. The announcement that economic adviser Larry Summers was leaving the White House contained this description of his job. "Dr. Summers overseas (sic) the coordination of economic policy-making across the administration."

We are certain that Dr. Summers did not do his White House job from overseas, nor did he advise on the overseas economy. We are pretty sure he O-V-E-R-S-E-E-S the coordination of economic policy. The bottom line here, folks, say all you want about spell-check, there is no substitute for a good copy editor.

Thank you for watching STATE OF THE UNION. I'm Candy Crowley in Washington. We want to go now to Drew Griffin in Atlanta as Bishop Eddie Long is preparing to give his press conference.