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CROWLEY: Joining me now, Republican Senator Roy Blunt of Missouri and Maryland Governor Martin O'Malley. He is the chairman of the Democratic Governors Association.
Thank you both. Big overriding question, first, and that is when we look at adjustments in the gross domestic product figures for the first and second quarters of this year, it's downward. It went from 1.7 to 1.3 when they adjusted it and looked back on the second quarter, exactly the same as it was last year.
I know we got all bollixed up in the question of "are you better off now than you were before?", but it doesn't look as if we're any better off now than we were last year. It's the exact same growth rate.
O'MALLEY: Except in one very important sense, Candy, and that is instead of losing jobs as a country, we're actually gaining jobs as a country. In fact, our private sector last year under President Obama's leadership created more private sectors than in all eight years of George W. Bush.
So I think what all of the economists would agree is that there is steady job creation that is happening. It could happen more quickly if Republicans in Congress would vote for some of the president's jobs initiatives.
CROWLEY: So your bottom line is that Republicans have stunted the -- the growth of the economy?
O'MALLEY: Oh, I think they've been trying hard. I think they've voted against every single jobs initiative the president has sent to The Hill and -- in an effort to try to slow the economy before the election.
They haven't been able to do it, we're still creating jobs instead of losing them as we were under George Bush.
CROWLEY: You -- you can't be happy that economic growth is -- 1.3 percent in a quarter is not great. It's growth, I grant you that, but it's the same as it was a year ago, so where's the improvement?
O'MALLEY: Well, when you -- when you -- when you compound it, I mean it's -- in Maryland, for example, we've recovered 70 percent of the jobs we lost during the Bush recession. We haven't recovered all that we lost during the Bush recession, but it's clearly headed in a more positive direction than it was before President Obama took office.
Home foreclosures are lower than they were before he took office. And so we're constantly still creating jobs; could do it faster if Republicans would stop blocking every jobs initiative on the Hill.
CROWLEY: Senator Blunt, I'm going to give you some equal time, but first, first, I want to play something that you're candidate said; and part of the reason there has been this (inaudible) on Capitol Hill is that Republicans have been adamant that there would be no tax increases, that what we actually needed was to retain tax cuts.
Mitt Romney has campaigned, much of the delight of conservatives on, I'm going cut everybody's taxes.
But here's what he said recently.
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ROMNEY: By the way, don't -- don't be expecting a huge cut in taxes because I'm also going to lower deductions and exemptions. But by bringing rates down, we'll be able to let small businesses keep more of their money so they can hire more people.
(END VIDEO CLIP)
CROWLEY: What do you make of that? Sounds like people aren't going to get a tax cut.
BLUNT: Well, I -- actually I think that's what the governor's been saying all the time, and it's what most Republicans have been saying all the time. Get the rate down, eliminate the -- a lot of the intricacies of the tax code...
CROWLEY: But hasn't he been -- I'm sorry. Hasn't he been campaigning on cutting taxes?
BLUNT: No, no, no, he has always said we're going to lower the rate and we're going to eliminate the complexity of the tax code. That's what he's said consistently. It doesn't mean revenue would go down. That would mean that people would have some sense that everybody's paying the same thing based on the same rules, both at the corporate structure and the individual structure and I think that's very consistent.
In fact, I think that's what the American people want. People are ready...
CROWLEY: Do you have any idea of what kind of deductions he's talking about?
BLUNT: ... people are ready for a significant relook at the tax code and we ought to take advantage of the moment when people want to see that happen, and it needs to happen next year.
CROWLEY: He -- he -- he is steadfastly sort of not told us what sort of deductions he's talking about eliminating. Do you have any idea what he's talking about, the home interest loans, charitable deductions, do you know what -- what he's talking about?
BLUNT: Well, I think you can look at the corporate code and see all those things that where you have some people, little corporations paying a higher percentage of what anybody would realistically see...
CROWLEY: Oil and gas loopholes?
BLUNT: ... as profit, other -- other big corporations being able to take more advantage of that broad, complicated tax code. I think he's saying let's eliminate that. Let's equalize, let's flatten that tax code in a way that everybody has a sense that everybody's being treated fairly.
CROWLEY: But it's your understanding that will not be a tax, that there will not be tax cuts -- big tax cuts.
BLUNT: You would reduce the rate and -- and in all likelihood, you would maintain the same amount of revenue, and of course, revenue grows if people have more confidence in the economy, if they have more competence and fairness and equity and that the rules are rules they can live with. CROWLEY: Governor O'Malley, let me pick your brain as head of the -- the Democratic Governors Association. There are 11 governorships up right now. Four of the eight that you're defending look like they could go to Republicans.
What's wrong here at the state level? Because the Republicans look like they're maintaining and could pick up some of the governorships currently held by Democrats. What's going on?
O'MALLEY: Well, actually, we're being greatly outspent in virtually every state, and we're -- we are defending 11 states, not in some of them, not in the friendliest of terrains for President Obama. But as we saw last year in Kentucky, a state that where the president did not prevail, our candidate was all about jobs, all about bringing people together to make the tough decisions to expand the economy and create jobs, and we've prevailed.
So I think you're going to see our candidates come through in this election.
CROWLEY: When you look at it, it's Montana, New Hampshire, North Carolina, Washington states, all of those held by Democrats, all look very threatened by pretty strong Republican races. That's 50 percent of those seats you're defending.
O'MALLEY: Right. Well, that's what makes it so exciting.
CROWLEY: Yeah, yeah, you look excited.
O'MALLEY: In fact, if you -- if you look at some of those states, I mean in the state of New Hampshire, where Maggie Hassan is running very competitively, she follows a Democratic governor who retires very, very popular. You look at Washington state, Jay Inslee, who literally wrote the book on green job creation and jobs through renewable energy...
CROWLEY: But they're competitive. Why is that?
O'MALLEY: Absolutely, because this is a competitive time. I mean, people -- people are very anxious about wanting to see our country create jobs more quickly. And some of those states, quite honestly, are in parts of the country geographically where it is tougher for the top of the ticket.
There are other states, however, where we're actually doing very well. I mean, look at Ohio. Ohio is a state where, granted, it's not up this year in the governor's race, but clearly there's a lot of voters remorse, particularly among women. 23 percent gender gap in Ohio because of the reactionary anti-woman policies of the Republican Party.
CROWLEY: So you think that the gap isn't that President Obama is doing so well. You think it's because they don't like Governor Kasich?
O'MALLEY: In Ohio, I think it is a combination, as John McCain just said, people seeing jobs being created in the auto industry, but they also are able to contrast that very hard right-wing policy, opposed to Lilly Ledbetter, trying to block women from being able to have contraception coverage on their health care policies, and all of those things have led to a much bigger gender gap, particularly in those states now led by hard-core, right-wing Republican governors who have taken their eye off of job creation.
CROWLEY: Well, they do have low unemployment rates, as you do, I grant you, but we're looking at some governors who have had some pretty low unemployment rates.
Senator Blunt, let me move you because the Senate -- three months ago I think most people would have said, oh, Republicans are going to take over. Now it doesn't look at all as though that's going to happen. Do you think that is the result of how well President Obama appears to be doing now, with a 3, 4 percent lead, or is it that the candidates aren't as good? What happened here?
BLUNT: Well, I think it's still at least 50-50 that Republicans take over the Senate, and if you look at Nebraska, Montana, North Dakota. Wisconsin now, I believe it will be a Republican seat on election day. And others, Virginia.
CROWLEY: Oh, because in Virginia and in Wisconsin both, the Democrat is up.
BLUNT: Well, but a few days ago, the Republican was up. Let's see what happens on election day. You know, the governor has said a couple of times the election is about Republicans who won't let things happen. You know, this election really should be about what happened the first two years of the Obama administration, when Democrats should have been able to do anything they wanted to do, and now is when that should pay off. We shouldn't be worried about what happened last month and how that impacts the economy, because, frankly, we've had no budget, no appropriations bills. The majority in the Senate, I think, will change, because people are tired of a Senate that won't do the things that need to be done.
CROWLEY: Let me ask you about the state of the race in Missouri. This is where you had Congressman Akin, who made a very controversial remark, which you condemned, which others condemned. You, in fact, said at the time, "We do not believe it serves the national interests for Congressman Todd Akin to stay in the race for Senate. The issues at stake are too big, and this election is simply too important. The right decision is to step aside."
As we all know, Todd Akin did not step aside. He is running as the Republican. And you are looking as though -- the Republicans are looking as though they're going to lose that race because Akin stayed in it.
BLUNT: I think at the end of the day, that race does largely become a debate about the majority in the Senate. Harry Reid is majority leader. What happens there? I think that becomes really big in that race. Frankly, I think that anybody else would have been a candidate that clearly would have won, and Todd very well may win. He is on a ticket at a time when people are looking at a Senate that's not doing its work, and the only way to change the Senate is to change the majority in the Senate.
CROWLEY: So you are going to sell it as a party race as opposed to the individual of Congressman Akin?
BLUNT: I think it becomes a party race in our state and lots of other places as well, as people look at these Senate races. And I'm not -- I think they look at them to a great extent independently of whatever has happened in the presidential race, but I think the presidential race is going to be decided by the economy, and the economy is not where people want it to be.
O'MALLEY: We have a great candidate in Missouri named Jay Nixon. Jay Nixon is going to be re-elected because he focuses on jobs and dealing with jobs--
CROWLEY: You are already holding that seat, though. It's the ones you might lose that are worrisome. Right?
O'MALLEY: That's right. And Akin is going to lose because of a demonstrated anti-woman policy that they have in the Republican Party, where one month Senator Blunt says he is not going to endorse Akin, then the next month he says he is going to endorse him, even after--
BLUNT: What I said was that the national issues are big enough that we need to have a discussion of those issues, rather than the ones that Todd managed to bring to the table.
CROWLEY: Which hopefully will be more favorable than the ones that he has brought up.
BLUNT: It's a race about the majority, and let's see how Todd does.
CROWLEY: Senator Blunt, Governor O'Malley, thanks for coming by.
BLUNT: Thank you.
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