MR. STEPHANOPOULOS: This week, John McCain.
SEN. JOHN MCCAIN (R-AZ): (From videovideotape.) I will take my campaign everywhere in the United States of America if I'm the nominee of the party.
FMR GOV. MITT ROMNEY (R-MA): (From videotape.) I'm officially endorsing his candidacy.
SEN. MCCAIN: (From videotape.) I promise you, I am fired up and ready to go. (Applause.) Thank you and God bless you.
MR. STEPHANOPOULOS: In his first Sunday interview as the GOP choice, McCain draws battle lines for November. On Iraq --
SEN. MCCAIN: (From videotape.) Senator Clinton and Senator Obama both said the surge wouldn't work, okay?
MR. STEPHANOPOULOS: Taxes.
MR. STEPHANOPOULOS: (From videotape.) Are you a read-my-lips candidate?
SEN. MCCAIN: No new taxes.
MR. STEPHANOPOULOS: And the Democrats.
MR. STEPHANOPOULOS: (From videotape.) Back in 2005 you said, I have no doubt that Senator Clinton would make a good president.
SEN. MCCAIN: (From videotape.) Well, look --
MR. STEPHANOPOULOS: We're on the trail. Plus, blowouts for Obama.
SEN. BARACK OBAMA (D-IL): (From videotape.) This movement won't stop until there's change in Washington D.C., and tonight we're on our way. (Applause, cheers.)
SEN. HILLARY CLINTON (D-NY): (From videotape.) Some people may think words are change, but you and I know better: words are cheap.
MR. STEPHANOPOULOS: Can Hillary come back? That, and the rest of the week's politics on our roundtable with George Will, Claire Shipman, Jay Carney, and Mark Halperin. And as always, the Sunday Funnies.
BILL MAHER: (From videotape.) You know that village, the one that Hillary says it takes to raise a child? It went for Obama. I'm just saying -- (laughter).
ANNOUNCER: From Washington, "This Week," with ABC News chief Washington correspondent, George Stephanopoulos.
MR. STEPHANOPOULOS: Good morning, everyone. After more than a year of debates, fundraisers, primaries, and caucuses, only three candidates still have a shot at the White House, and we were back on the trail this week with the man Republicans have chosen to make their case.
SEN. MCCAIN: (From videotape.) There you go. Thanks very much. Thank you.
MR. STEPHANOPOULOS: John McCain's Potomac primary sweep --
SEN. MCCAIN: (From videotape.) Thank you voters of Maryland, Virginia, and the District of Columbia.
MR. STEPHANOPOULOS: -- sealed the deal. But with Wisconsin voting on Tuesday, McCain stayed on the trail --
UNIDENTIFIED SPEAKER: (From videotape.) Ready to go someplace warm?
SEN. MCCAIN: (From videotape.) (Unintelligible) -- stand out there in the cold, do you?
MR. STEPHANOPOULOS: Training fire on the Democrats --
SEN. MCCAIN: (From videotape.) Well, they were wrong when they said that we couldn't succeed militarily.
We're going to have a great debate between myself and either what apparently will be Senator Clinton or Senator Obama.
MR. STEPHANOPOULOS: Taking nothing for granted.
SEN. MCCAIN: (From videotape.) Please remember the words of the late Mayor Daley of Chicago who once said: vote early and vote often.
MR. STEPHANOPOULOS: Good to see you, sir.
SEN. MCCAIN: It's good to see you. How are you?
MR. STEPHANOPOULOS: Good. I'm well, thank you.
We caught up with him in Milwaukee.
(To McCain.) You're a superstitious man. You've got the lucky penny?
SEN. MCCAIN: People say I'm the luckiest. (Laughs.) I don't like to use superstitious. I just feel that I'm very lucky and I like to have things that make me luckier.
MR. STEPHANOPOULOS: So when was the first moment you let yourself believe I'm going to be the nominee?
SEN. MCCAIN: I haven't yet. (Laughs.)
MR. STEPHANOPOULOS: Not yet?
SEN. MCCAIN: Well, I think we've got to go through it. I think we've got a very good shot at it and I'm optimistic, but I think the time to do that is when Governor Huckabee and the party decides that I am the nominee. He's still in the race and he said he's going to stay in and I respect that, so we'll compete.
MR. STEPHANOPOULOS: Back in 2005 you said, I have no doubt that Senator Clinton would make a good president.
SEN. MCCAIN: Well, look. Senator Clinton and I were sitting next to each other and we're asked, would she, quote, "be a good president?" She would be a good president in the respect that I think she has integrity, I think she has all of the qualities that are necessary, but she has a very different philosophical view -- the liberal-Democratic view -- than I have, which is conservative Republican. So when you say, good, she's a good person, but we have strong differences in our views of government. I think she is a very good person. I think that Senator Obama is a good person.
MR. STEPHANOPOULOS: But not good presidents.
SEN. MCCAIN: They certainly wouldn't make the kind of president that I would be or I wouldn't be running. You see my point? It's not a, quote, "good." I think they would work hard. I think they would be dedicated to the things that they believe in and stand for. I just have different fundamental philosophical views than they do.
MR. STEPHANOPOULOS: But it sounds like you wouldn't say the same thing today.
SEN. MCCAIN: I would say they would be good in the respect they're people of good character, honesty, integrity, when you look at that. Would they be good from a governing standpoint? Certainly not what I would do for this country.
MR. STEPHANOPOULOS: Senator Obama focused on you on Tuesday night. The first issue he raised was Iraq.
SEN. OBAMA: (From videotape.) I will offer a clear choice. John McCain won't be able to say that I ever supported this war in Iraq, because I opposed it from the start. (Applause.) Senator McCain said the other day that we might be mired for 100 years in Iraq -- (booing) -- 100 years.
MR. STEPHANOPOULOS: He says it's the wrong war, the wrong time, not worth the cost in blood and treasure. You obviously have a very different view.
SEN. MCCAIN: Yes.
MR. STEPHANOPOULOS: And the country seems to agree, at least right now, with him. Can you win that argument and can you win the White House if you don't?
SEN. MCCAIN: I am confident that I can convince the American people that the consequences of a date for withdrawal are catastrophe and al Qaeda trumpets that they win. I believe I can convince the American people that after nearly four years of mishandling of the war that we're now doing the right thing and we're succeeding. I think I can convince the American people that continuing with this strategy, we will be able to withdraw more troops, we will provide a political and economic stability along with military stability.
Look, let me just remind you that Senator Clinton and Senator Obama both said the surge wouldn't work, okay? They said it wouldn't work. Most objective observers believe that it is. They said that, then they said that politically there would never be any progress in Iraq. Well, they just passed the laws -- series of law a little bit better than what we do in Washington -- they passed a budget. But more importantly, they're going to have provincial elections; more importantly they're going to have resolving this issue of Sunni integration into the government and society, and they are making progress. So they're wrong again. So they are wrong about --
MR. STEPHANOPOULOS: But if Iraq is meeting those marks, then why not withdraw our troops step by step as Senator Obama and Senator Clinton call for?
SEN. MCCAIN: Because it has to be dictated by events on the ground, not by an arbitrary date -- (inaudible).
MR. STEPHANOPOULOS: But we are making progress (you say ?).
SEN. MCCAIN: We are making significant progress and General Petraeus will come back at the beginning of April and he will testify to that, but he will be, I think, the major determining factor, because he has succeeded, as to when and how we withdraw additional troops. It can't be done plucked out of the air that we're just going to withdraw.
MR. STEPHANOPOULOS: President Bush is also negotiating a long- term status of forces agreement with Iraq. Both Senator Clinton and Senator Obama say that agreement has to come to the Congress.
SEN. MCCAIN: It wouldn't bother me to bring it to the Congress. I don't think that's a huge deal. We have status of forces --
MR. STEPHANOPOULOS: President Bush says he doesn't want to, though.
SEN. MCCAIN: Look, if we succeed in Iraq, which I believe we are, the rest of it takes care of itself. We have status of forces agreements with a number of countries that have never been approved by Congress. We have some others that have approved by Congress.
MR. STEPHANOPOULOS: But the big ones, Korea was approved by Congress.
SEN. MCCAIN: Yes, but we have some countries. We're still in Bosnia. We don't have a status of forces agreement there as I recall. We have -- look -- the major issue here -- I don't have --
MR. STEPHANOPOULOS: But you have no problem bringing it to the Congress is what you're saying.
SEN. MCCAIN: I don't have a problem with going to Congress, because I think the issue takes care of itself when we succeed. I still say setting a date for withdrawal is chaos, genocide, and we'll be back because al Qaeda will then succeed.
MR. STEPHANOPOULOS: How about Iran? You've said many, many times -- the only thing worse than war with Iran is a nuclear Iran. Would President McCain come to Congress before taking military action against Iran?
SEN. MCCAIN: Unless it was some dire emergency that required -- you know, and they were about to launch or something like that, but under -- in most, almost all reasonable scenarios, of course. George, I really believe that having been a member of Congress all these years that we have to have better, more of a partnership with the Congress. We have to have more consultation. We have to do those things, but there still is only one title of commander-in-chief -- one person with that title.
MR. STEPHANOPOULOS: Number one issue right now, the economy. Senator Obama went at that on Tuesday night as well.
SEN. OBAMA: (From videotape.) I admired Senator McCain when he stood up and said that it offended his conscience to support the Bush tax cuts for the wealthy in a time of war, but somewhere along the road to the Republican nomination, the "Straight Talk Express" lost its wheels because now he's all for those same tax cuts.
MR. STEPHANOPOULOS: He says, basically, you've sacrificed your principles for the sake of the nomination.
SEN. MCCAIN: Well, for a long time I have said that I thought the tax cuts ought to be made permanent. For a long time back I said, look, we've got to have spending restraint the way that Reagan did when he restored our economy when it was in the tank thanks to then President Carter's mismanagement of the economy and we entered into a great period of prosperity in America.
Spending restraint is why our base is not energized. Spending restraint is why we are having to borrow money from China and we've got to have spending restraints in my view. But to impose on the American people what essentially would be a tax increase of thousands of dollars for a family in America is not something I think -- I'm sure would be bad for the economy of this country.
MR. STEPHANOPOULOS: So on taxes, are you a read-my-lips candidate, no new taxes no matter what?
SEN. MCCAIN: No new taxes.
I do not -- in fact, I could see an argument if our economy continues to deteriorate for lower interest rates, lower tax rates, and certainly decreasing corporate tax rates which are the second highest in the world, giving people the ability to write off depreciation in a year, elimination of the AMT. There's a lot of things that I would think we should do to relieve that burden, including obviously, as we all know, simplification of the tax code.
MR. STEPHANOPOULOS: But under no circumstances would you increase taxes?
SEN. MCCAIN: No.
MR. STEPHANOPOULOS: How about -- what else would you do right now to get this economy moving again? A lot of people are worried about it. Many Democrats have said and many outside economists have said we're in a recession right now. Do you think we are?
SEN. MCCAIN: I think according to what the experts, Bernanke and others, are saying, we're very close to it. In fact, closer to it than we have been for some time. I think it's very important that we send a signal to the American people we're going to stop the earmark pork-barrel spending. Is that a huge part of the budget --
MR. STEPHANOPOULOS: But what is that going to do to get the economy moving?
SEN. MCCAIN: Because it's out of control. Well, one reason is in the last two years, the president signed in a law $35 billion worth of pork-barrel projects. That would have been a $1,000 tax credit for every child in America. Wouldn't it have been better for our economy to give $1,000 tax credit for every child in America as opposed to a bridge in nowhere in Alaska? And it also has a confidence impact -- a confidence impact that the American people see their tax dollars being frittered away in wasteful and unnecessary spending, which by the way, Senator Obama has engaged in heavily and Senator Clinton has engaged in heavily. They've bought in. They're talking about change?
MR. STEPHANOPOULOS: But is that --
SEN. MCCAIN: I want change to be stop this waste of Americans' tax dollars.
MR. STEPHANOPOULOS: But is that really the answer to the housing crisis we're seeing right now, the credit crunch we're seeing right now, the anxiety Americans are feeling?
SEN. MCCAIN: I think it is. I think we've got a -- I'm glad we did the stimulus package. I think we need to have lower interest rates. I think we need to eliminate the AMT, I think we need to have depreciation in one year of business investment. I think we need to reduce the corporate tax rate which is the second highest in the world, only exceeded by Japan. I think there's a long series of steps we need to take and many of them we haven't even contemplated yet if necessary. But having the impact of a tax increase is certainly not one of them and that is what Senator Obama and Senator Clinton are saying.
MR. STEPHANOPOULOS: They have also said -- both Senator Obama and Senator Clinton have said, we need a government fund to provide -- to help borrowers who are facing foreclosure on their homes. Good idea?
SEN. MCCAIN: I don't think so yet. We have the FHA working. We have a number of institutions working with them, but I will be glad to do whatever's necessary to relieve the burden of people who are legitimate borrowers who see their home loan interest payments so high -- mortgage payments so high that they can't afford it anymore, but I don't want to reward people who engaged in speculation and I certainly don't want to reward institutions that engaged in the practice of lending people that couldn't afford to pay back the loan.
MR. STEPHANOPOULOS: But you're open to helping homeowners?
SEN. MCCAIN: I am open to helping homeowners. I would rely to a large degree on the situation with time, but also people like Secretary of Treasury Paulson who the financial markets and a lot of us have a great deal of faith in. If more needs to be done, I'm for doing more.
MR. STEPHANOPOULOS: You mentioned earlier that we needed lower interest rates. Do you believe that Ben Bernanke has been too slow off the mark?
SEN. MCCAIN: It's hard for me to make the judgment. Usually, these judgments are made in the rearview mirror, as we know, but I personally would have liked to have seen those rate cuts earlier. A lot of the people that I respect that are advising me like Phil Graham and Jack Kemp and so many others that are in our team -- on our team -- said that they would have liked to have seen it earlier. So I guess I would have to say I would have liked to have seen faster rate cuts and earlier than they were done by him. That doesn't mean I want him fired. It doesn't mean that I've lost -- (inaudible).
MR. STEPHANOPOULOS: You would reappoint him if you were elected?
SEN. MCCAIN: I think those terms of office are --
MR. STEPHANOPOULOS: Two thousand ten.
SEN. MCCAIN: Two thousand ten. I would have to consider that at the time obviously.
MR. STEPHANOPOULOS: How about on the issue of climate change, because you and Senator Lieberman have come out for a bill which would have mandatory reductions in greenhouse gases.
SEN. MCCAIN: Gradual reductions, yes.
MR. STEPHANOPOULOS: But they are mandatory. Are you sticking by that?
SEN. MCCAIN: What I mean by that is that it's cap and trade, that there will be incentives for people to reduce greenhouse gas emissions. It's a free market approach. The Europeans are using it now. We did it in the case of addressing the acid rain. Look, if we do that, we will stimulate green technologies. I have great faith in the American industry. General Electric, the world's largest corporation, has announced they're dedicated to green technologies. This will be profit making business. It won't cost the American taxpayer. It will make profits because we'll move forward with the innovation and ability of American industry to address this issue.
MR. STEPHANOPOULOS: How about the broader frame of this election?
SEN. CLINTON: (From videotape.) I have the greatest respect for my friend and my colleague, Senator McCain, but I believe that he offers more of the same -- more of the same economic policies, more of the same military policies in Iraq.
MR. STEPHANOPOULOS: Both Senator Clinton and Senator Obama are basically saying, vote for John McCain, you're voting for a third Bush term.
SEN. MCCAIN: Right. They can -- they're free to say most anything they want to. We will wage this campaign on profound and significant philosophical difference.
MR. STEPHANOPOULOS: But how will you be different from President Bush?
SEN. MCCAIN: Senator Obama was --
MR. STEPHANOPOULOS: How will --
SEN. MCCAIN: Climate change is an issue, spending is another issue. There's a number of issues. But Senator Obama was judged by the "National Journal" as the most liberal senator in the United States Senate. I'm proud of being a conservative Republican. We will have a respectful but spirited debate and the same thing with Senator Clinton. We'll argue about earmarks and pork-barrel projects. Why is it that Senator Clinton got $340 million of pork-barrel projects? Senator Obama only $92 million. But more importantly, we'll argue about whether we should increase your taxes or decrease them. Obviously, I'm for decreases in taxes. Maybe Americans want their taxes increased.
MR. STEPHANOPOULOS: They said they're going to cut taxed for middle-income Americans, only raise them on the wealthy.
SEN. MCCAIN: Oh, yes. Sure. The wealthy. The wealthy. Always be interested in when people talk about who the, quote, "wealthy" are in America. I find it interesting. But also, healthcare. They want the government to run the healthcare system in America. I want the families to make the choice. We're going to have a number of very --
MR. STEPHANOPOULOS: They say your plan won't reduce the ranks of the uninsured.
SEN. MCCAIN: They can say whatever they would like, but the fact is that if we bring healthcare costs under control and give families choices and have medical malpractice reform and treat to the chronic diseases with outcome-based rewards and payments and a number of other things which, you know, we hold hours-long healthcare forums on, we can preserve the highest quality healthcare in the world in America, but we've got to make it affordable and available. If you like Senator Obama's plan and Senator Clinton's plan, go to Canada or one of the European countries before you make that decision. (Laughs.)
MR. STEPHANOPOULOS: But you said before that we should be open to importing drugs from Canada.
SEN. MCCAIN: Sure. Why not? Wherever it's cheaper.
MR. STEPHANOPOULOS: So you have no problem --
SEN. MCCAIN: Wherever it is cheaper and we can be assured --
MR. STEPHANOPOULOS: George Will argues that that's going to be importing their price controls.
SEN. MCCAIN: Well, again, with all due respect, if it's less expensive where they can get it and we know that it's safe and available and affordable, I'm all for it.
MR. STEPHANOPOULOS: How about the situation in your own party right now? Have you quelled the rebellion among conservatives?
SEN. MCCAIN: I think we're making progress there, George. Primaries are tough to start with, as you well know, and so we've got to heal those up and we're making progress in that direction.
REP. JOHN BOEHNER (R-OH) (House Republican Leader): (From videotape.) A man of great character and conviction who has done much for his country.
SEN. MCCAIN: I've got the Republican leadership in the House endorsement and you know the things that we've doing, a number of the, quote, "conservatives" are coming over to our side, but I've got a lot of work to do to unite the party and I'm trying to do that.
MR. STEPHANOPOULOS: Rush Limbaugh says he's doing you a favor by not endorsing you.
RUSH LIMBAUGH: (From videotape.) If I really wanted to torpedo McCain, I would endorse him. If I wanted to torpedo McCain -- because that would send the independents and liberals that are going to vote for him running away faster than anything.
SEN. MCCAIN: I respect Mr. Limbaugh, but I do not know which direction he heads. I respect him, but I don't have --
MR. STEPHANOPOULOS: He's been tough on you, though.
SEN. MCCAIN: But that's his right to do that. He is an influential person in America on talk radio. That's what he wants to do, that's certainly his right to do it, and I respect his --
MR. STEPHANOPOULOS: Do you need talk radio to get behind you?
SEN. MCCAIN: Well, I'd like to, obviously, have every part of our base behind us and I hope that if anyone wants to meet with me, I'm certainly willing to meet with them and we are making -- as I said, we are making progress and we've got time, but I'm working hard at it.
MR. STEPHANOPOULOS: We've talked a lot about taxes and spending today and that's what economic conservatives worry about. Social conservatives are most worried about judges in the Supreme Court. And from talking to them, I get the sense that their biggest fear is that there's going to be another David Souter on the court.
SEN. MCCAIN: One of the ways I can reassure them is that the White House would tell you that I was one of those who played an active role in the confirmation of Justices Alito and Roberts, the so- called gang of 14, which was maligned though by some. We were able to get all but two of the president's nominees into -- confirmed by the United States Senate. I have pledged that I will nominate only people to the bench that strictly interpret the Constitution of the United States and I hope that I can assure them of that commitment.
MR. STEPHANOPOULOS: Can you name some candidates out there who meet that criteria?
SEN. MCCAIN: You know I can't, George. I don't know any right now because there's not an opening on the United States Supreme Court. I know that people like Ted Olson, who are advising me and supporting me, and the Federals, I would seek their advise and counsel -- John Kyl who is on the committee and my close friend in the Senate and others, but I have not examined the other candidates because it just hasn't been topical yet.
MR. STEPHANOPOULOS: How about on the vice presidency?
SEN. MCCAIN: We're getting ahead of ourselves.
MR. STEPHANOPOULOS: Yes, but do you feel a need -- not that far ahead -- do you feel a need to pick someone who conservatives say right off the bat, he or she is one of us?
SEN. MCCAIN: Well, I hope that I could nominate someone in all of our party. We have a lot of our party -- that all of our party would feel comfortable with and that's a process that, again, you've seen before where we begin the process of looking at the various people. But again, I am a little bit superstitious in that I really want to make sure that we have a nomination before I started that process.
MR. STEPHANOPOULOS: So you've done nothing on that?
SEN. MCCAIN: No. Nothing.
MR. STEPHANOPOULOS: One of the other things you're going to have to deal with in the fall, and we've seen this throughout the primary process -- the enthusiasm gap.
SEN. MCCAIN: Exactly.
MR. STEPHANOPOULOS: More Democrats coming out to vote, Democrats raising a lot more money than Republicans right now, more enthusiasm for their candidates. That's a big barrier to you in November.
SEN. MCCAIN: Listen. This is going to be an uphill battle all the way. I can out-campaign them and I can out-debate them, and I can now outperform them in what I think my vision for America is more in keeping with the majority of Americans. But I mentioned to you earlier -- we've got to reunite the party and we've got to reenergize the party. And I'm prepared to do that. We've got plenty of time, but I won't waste a day.
And I'd like to mention one other thing. I'll compete all over America. We'll be competing everywhere, including the state of California.
MR. STEPHANOPOULOS: Including California?
SEN. MCCAIN: Excuse me, California. Yes.
MR. STEPHANOPOULOS: We're just about out of time. You know, the last time I was on the trail with you, I've seen you since then, but the last time I was on the trail with you was in Iowa last summer.
SEN. MCCAIN: I remember.
SEN. MCCAIN: It was back in June. Your campaign was in a lot of trouble. I talked to a lot of people about your campaign this week, and here's the phrase they use when they talk about your campaign -- dead man walking. How did you come back?
SEN. MCCAIN: I think we went and told everybody the truth. We had the town-hall meetings. I told you back then I thought I could out-campaign my opponents because I love it. I think also that we had a kind of a seminal experience. I was in Baghdad over 4th of July, 688 brave young Americans reenlist to remain in the military and fight there. They could have gone home. I was inspired by that. I said, look, we're going to take on this surrender that the Democrats want to have. Harry Reid had declared the war lost. They were all saying they were going to set a quick date for withdrawal. We fought it off, the surge started succeeding, and we started succeeding in our campaign. And I've been very, very lucky and worked hard and I'm very humble. And I believe that this isn't about personality, it's about serving.
MR. STEPHANOPOULOS: Senator, thanks very much.
SEN. MCCAIN: Thanks for having me on again.
MR. STEPHANOPOULOS: Senator McCain will be Houston tomorrow to get the endorsement of former President George H. W. Bush.