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ABC "This Week with George Stephanopoulos" - Transcript


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ABC "This Week with George Stephanopoulos"

MR. STEPHANOPOULOS: Good morning and welcome to Indianapolis. We are here in the Conrad Hotel with about 200 voters armed with questions for Senator Clinton. It is a diverse group. We've pulled it together with the help of local colleges, civic and political organizations. It's a mix of Obama supporters, Clinton supporters, and undecided voters, including independents and Republicans. We're also joined by a similar, somewhat smaller group in North Carolina who've gathered at ABC's affiliate in Raleigh-Durham, WTVD. We've asked everyone to bring a question. I've gone through all of the questions. I have a lot of questions of my own as well. And for any of you who don't know, I worked for President Clinton from 1991 to 1996.

And with that, let me welcome Senator Clinton.

SEN. CLINTON: How are you, George?

MR. STEPHANOPOULOS: I am doing well. Thanks for being here today.

SEN. CLINTON: Welcome to Indianapolis.

MR. STEPHANOPOULOS: Good to be here. Gas tax has become the defining issue in this primary and in North Carolina. You and Senator McCain call for suspending the 18.4 cent federal gas tax. Senator Obama calls it a gimmick. He says it's pandering. He says it won't really bring any help to consumers. He also said this.

SEN. BARACK OBAMA (D-IL): (From tape.) The same thing that John McCain is offering on the cheap, that means we are not presenting a truthful response to the challenges that we face in America.

MR. STEPHANOPOULOS: What's your response? He says you're not being truthful.

SEN. CLINTON: Well, number one, my proposal is very different from Senator McCain. Senator McCain has said take off the gas tax, don't pay for it, throw us further into deficit and debt. That is not what I've proposed. What I've proposed is that the oil companies pay the gas tax instead of consumers and drivers this summer. Now, why am I proposing this? Well, number one, I am absolutely convinced that these record profits of the oil companies are a result of a number of factors beyond supply and demand. I think there's been market manipulation.

In fact, an Exxon Mobil official testifying under oath before the House of Representatives Committee said that if it were just market factors, then the price of oil would be like $50 or $55 a barrel. We know that there's market manipulation going on, so I would launch an investigation if I were president right now by the Department of Justice and the Federal Trade Commission. I would also quit buying oil for the strategic petroleum reserve. We're 97 percent full. We don't need to keep buying it at these high prices, and I would release some.

I would begin to go directly at OPEC. I think it's been 25 years where we've largely just been at the mercy of the OPEC countries. But this gas tax issue to me is very real because I am meeting people across Indiana and North Carolina who drive for a living, who commute long distances, who would save money if the oil companies paid this $8 billion this summer instead of it coming out of the pockets of the consumers.

MR. STEPHANOPOULOS: Economists say that's not going to happen. They say this is going to go straight into the profits of the oil companies. They're not going to actually lower their prices. And the two top leaders in the House are against it. Nearly every editorial board and economist in the country has come out against it, even a supporter of yours, Paul Krugman of the "New York Times" calls it pointless and disappointing. Can you name one economist, a credible economist who supports the suspension?

SEN. CLINTON: Well, you know, George, I think we've been for the last seven years seeing a tremendous amount of government power and elite opinion basically behind policies that haven't worked well for middle-class and hardworking Americans. From the moment I started this campaign, I've said that I am absolutely determined that we're going to reverse the trends that have been going on in our government and in our political system, because what I have seen is that the rich have gotten richer, a vast majority -- I think something like 90 percent of the wealth gains over the last seven years have gone to the top 10 percent of wage earners in America.

MR. STEPHANOPOULOS: But can you name an economist who thinks this makes sense?

SEN. CLINTON: Well, I'll tell you what. I'm not going to put my lot in with economists because I know if we did it right -- if we actually did it right, if we had a president who used all the tools of the presidency, we would design it in such a way that it would be implemented effectively. Now, look, I have long-term plans, too. It's a misnomer to say this is all that I'm doing. It's not. I have a comprehensive, long-term energy plan that would go right at dependence on foreign oil. We've got to undermine this incredible addiction that we have. We use more foreign oil today than we did on 9/11. That is a disaster for America, also that we've got to more toward more alternative and renewable fuels, and get our gas mileage up -- increase those CAFE standards.

MR. STEPHANOPOULOS: But that's one of the problems here. You've already spent, according to our research, the windfall profits tax on this strategic energy fund for renewable energies and alternative energies.

SEN. CLINTON: No. No. The tax subsidies. The tax subsidies will go right into that. I'm talking about something temporary this summer. My longer term plan is, yes, to put an excess profits tax on the oil companies above a certain level of profit that would go in to help us make the transition.

But let's step back here a minute, George. It's really odd to me that arguing to give relief to the vast majority of Americans creates this incredible pushback. When the federal government through the Fed and the Treasury gave $30 billion in a bailout to Bear Stearns, I didn't hear anybody jump and say, that's not going according to the market. That's rewarding irresponsible behavior.

We've got to get out of this mindset where somehow elite opinion is always on the side of doing things that really disadvantage the vast majority of Americans, and get back to looking hard at what we're going to do to stop the housing crisis. For months now I've been saying we need a moratorium on home foreclosures and we need to freeze interest rates. I think that would help us stem what's happening in not just the housing market, but the general decline in the economy. Well, we can't get that through the Congress either. And on healthcare, on so many of these issues where costs have gone up, where people are really feeling squeezed, there just doesn't seem to be an understanding about what people are going through.

MR. STEPHANOPOULOS: Let me go to one of the voters who's feeling squeezed. Kara Glenan (ph) is here. Kara is a Democrat. She's supporting Obama. I think you've contributed $25 to him. What's your question on the gas tax?

Q: I have. Senator Clinton, I actually make less than $25,000 a year, so talking about gas prices is not academic for me. I really do feel pain at the pump. However, I do feel pandered to when you talk about suspending the gas tax. I don't think that it's really a reasonable plan. And call me crazy, but I actually listen to economists because I think that they know what they've studies.

You said that you have both a short and a long-term plan for our energy consumption. However, since the suspension of the gas tax would encourage continued over-consumption, which could possibly cancel out any price savings and also undermine our effort to curb global warming, and your long-term plan includes trying to, say, curb global warming, don't you feel that these two plans are in conflict?

SEN. CLINTON: No. And let me stand up because I can see you better from this angle. Actually, I'm glad you asked this question because I want to make it very clear that we're talking about short- term relief and a long-term plan, and I have a very comprehensive, long-term plan to reduce our dependence on foreign oil, increase the mileage of our automobiles, and to do it in a way that will push us forward as a leader in the world again, which we have not been on the issue of global warming. And I'd invite everyone to go to my website, and read about it.

But if you are driving, on average in America this summer, you'll save -- according to the Department of Energy figures -- about $70. If you are a long distance commuter, and a lot of people in Indiana and North Carolina are, if you are a truck driver who depends upon your truck for your living, you're going to save a lot more. In fact, truckers will save about $2 billion in fuel costs.

You see, I really believe we've got to start right now demonstrating a willingness to take on these oil companies. I voted against the big oil giveaway in the 2005 energy bill. My opponent voted for it. I'm on record of taking on the oil companies. And I think having a good debate like we're having right now in this campaign helps to lay the groundwork for what we're going to need to do.

MR. STEPHANOPOULOS: Senator Clinton, let me bring this back to Senator Obama and what he said there. He said you weren't being truthful, and that seems to be going straight at the Achilles' heel of your campaign. Our recent poll showed six out of 10 voters think you're dishonest. That's a heavy burden to carry into the general election. What do you say to Democrats who are worried about that?

SEN. CLINTON: Well, obviously, it's troubling that people would have that opinion because I think most of the people who have voted for me and support me in New York -- and I was reelected with 67 percent of the vote -- believe they can count on me. And they have good reason to count on me, because I've gotten up year after year, going back many years, to stand up for controversial issues like health care for every America, something that I feel passionately about.

So have I drawn a lot of fire from people who've come right at me, and frankly, done a lot of attacking of me? Sure. But I think that goes with being a leader. You see, I just have a fundamental disagreement about how you get change in America. I wish that we could all just get together and decide we're going to make change. I wish that were the case. But maybe I know enough about human nature and about our political system to understand you really have to take these interests on. They do not go gently into the night.

MR. STEPHANOPOULOS: But don't voters have to trust you as you're taking these interests on?

SEN. CLINTON: Well, the voters of New York have trusted me twice, and I think the people throughout this campaign as I have campaigned across Texas, Ohio, Pennsylvania, Indiana, North Carolina have seen me in person as opposed to what they hear about me, and I know you hear a lot about me. There's a lot out there that I have no control over. But if you really look at what I've done and where I stand, I have a consistent record of standing up for people and fighting for people and getting results for people, and that's what I would do as your president.

MR. STEPHANOPOULOS: Indiana manufacturing has been hit very hard -- 45,000 jobs lost to China.


MR. STEPHANOPOULOS: We have another question from Charles Herman -- Hedman, excuse me. Charles, are you out there? Charles is actually a supporter of yours. He's a lawyer who just passed the bar exam. What's your question?

SEN. CLINTON: Oh, congratulations.

Q: Thank you. Thank you. Hillary, Alexander Hamilton said that the key to U.S. supremacy in the world is the manufacturing sector. Senators Obama and McCain have stated that these manufacturing jobs that we've lost cannot be brought back to Indiana or the United States. What is your position? Do you agree with Senators Obama and McCain? And if you do not, what is your plan to stimulate the sector in general?

SEN. CLINTON: Well, I believe very firmly that if you don't make things in an economy, you will not have a strong economy over the long run. I just believe that our declining manufacturing base is a threat to the overall economy. It's not isolated to one part of what we do in this country. So what I have said is we may not be able to bring back a lot of the jobs we've lost, but, number one, we've got to stop losing jobs. And Indiana has lost 45,000 under President Bush in manufacturing alone.

So here's what I would do. We're talked about this. We've never got it done, certainly under the Republicans they were not about to. We need to change the tax code to take out any single benefit from your tax dollars that goes to any business that exports a job out of Indiana to any foreign country. It's outrageous. It's unpatriotic. That is still going on. And you look at the tax code, it makes sense. We've got a free country. If people want to start jobs somewhere else, we're not going to stop them, but why should we help them? Why should we tell them if you move those jobs and you make profits over there, you don't have to pay taxes on them unless you bring the money back home? Well, hey, why would you ever bring the money back home?

Number two, we need trade agreements that recognize the 21st- century economy is not the 20th or the 19th century. We've got to be much more vigorous in having a trade policy that really does enforce strong labor and environmental standards, otherwise we will never be competitive, because the fact is that we try to do right for our workers and our consumers in America. If you go to work in Indiana, there are certain rules that the employers have to follow to protect your safety and your health. And there are certain consumer rules. But look what's happening with China. We get lead laced toys and contaminated pet food and polluted pharmaceuticals sent back into our market. They get our jobs.

Thirdly, if we're going to have $500 billion defense budget, then I want to see American workers do what is necessary to produce the defense materials and goods for our country.

MR. STEPHANOPOULOS: And you've been running an ad here in Indiana about that. Magnaquench, a company here in Indiana, closed down -- 200 jobs gone to China. You said that President Bush could have stopped it, yet your critics say wait a second. This original sale to the Chinese was approved in 1995 under the Clinton administration. How do you respond?

SEN. CLINTON: Well, let me tell you the facts because I think that's a fair question. Yes. The sale was approved with the conditions that the jobs stay in India for the production --

MR. STEPHANOPOULOS: Just for 10 years though.

SEN. CLINTON: No. It was supposed to be revisited, but the plan was that those jobs will always stay in Indiana because those magnets were part of our precision guided missiles.

So in 2003, when the company wanted to move the jobs to China, Senator Evan Bayh, who is my friend and my great supporter, went to the White House, went to the administration, and said, you have the power -- which the president did -- to stop these jobs from leaving, and the president wouldn't do it.

MR. STEPHANOPOULOS: But he also laid the blame on that original sale.

SEN. CLINTON: Look, we now have learned a lot more than we knew then, and what we have learned is that we cannot afford, even with conditions under the circumstances that we find ourselves, to do anything that opens the door to losing those jobs.

MR. STEPHANOPOULOS: Given what we've learned, do you think now looking back on the 1990s, that the Clinton administration -- and you've come out against free trade agreements now, but the Clinton administration didn't do enough to address the downside of globalization and therefore failed the workers in Indiana and the workers of the West.

SEN. CLINTON: Well, what I believe, George, is that in the 1990s we had a booming economy that created nearly 23 million new jobs, more people were lifted out of poverty in any time in our recent history. It was an economy that worked for everyone, not just the rich, the wealthy and the well connected, but there were underlying issues that we didn't understand fully. Now, you remember this, because George did work in that '92 campaign, and George and I actually were against NAFTA -- I'm talking about him in his previous life, before he was an objective journalist -- (laughter) -- and doesn't have opinions about such matters.

MR. STEPHANOPOULOS: Plenty of opinions.

SEN. CLINTON: Yes. But we were in meeting together where we said, look, we think there's going to be a lot of downsides and we're not really thinking through that, but in the 20th century and until relatively late in the 20th century, we dominated the world economy.

MR. STEPHANOPOULOS: Senator, what you --

SEN. CLINTON: And we had an opportunity to really see our jobs grow here by being smart about how we traded --

MR. STEPHANOPOULOS: But, Senator, can you --

SEN. CLINTON: But then, we've got to make changes. Life has changed.

MR. STEPHANOPOULOS: Can you really have it both ways there? You talked about being against NAFTA in 1992 and 1993, yet, President Clinton has said time and time again, NAFTA, the free trade agreements were part of the economic success in the 1990s. How can you claim credit for the good things, but not take blame for the bad?

SEN. CLINTON: Right. Well, I have said very clearly that I'm going to renegotiate NAFTA and I will fix NAFTA, but I think it's also fair to say, George, that when the Congress turned Republican in 1995, they had a different set of priorities than the Clinton administration did, because if you look at some of the factors that have led to job loss and increasing cost, clearly, our failure to have an universal health care system puts us at a competitive disadvantage, because businesses bear the cost or they just don't help their employees.

So we are essentially competing against companies and countries that handle health care differently. They either spread the cost among everybody or they don't pay for anything. We try to keep the costs localized on local business. So if you look at the number of cost drivers that exist in our economy, we have failed to address a lot of them.

Now, we can keep talking about what we should have done or could have done, or we can elect a president who will do it, and that's what I intend to be, because we've learned a lot and we understand what we're going to have to do in order to have a globally competitive economy that creates a lot of good jobs again in America.

MR. STEPHANOPOULOS: There's still some suspicion of you, though, on free trade, in part because President Clinton continues to advocate free trade. He's taken since leaving the White House more than $1 million in speaking fees from interests representing China and others, and also contributions to the library. Because of that, why shouldn't his library release all the contributors, so people can decide whether there's a conflict?

SEN. CLINTON: Well, first, let me say that I don't know any married couple that agrees on everything, and we have a disagreement on some of --

MR. STEPHANOPOULOS: That's for sure.

SEN. CLINTON: -- our position and our policies.

MR. STEPHANOPOULOS: But shouldn't voters have the right to decide?

SEN. CLINTON: Absolutely. Now, with respect to his foundation, which is doing wonderful work around the world on HIV/AIDS and climate change and poverty alleviation, he has said, and I am 100 percent in agreement that if I am so fortunate as to be elected president, all of that will be released. But is it -- well --

MR. STEPHANOPOULOS: But why wait? Why shouldn't voters have a chance to decide?

SEN. CLINTON: Well, but George, it's a national foundation, and like most national foundations, the rules were set up, people contributed under those rules, so going forward, if I'm president, we'll change the rules.

MR. STEPHANOPOULOS: Yet the foundation sold the donor list, 38,000 names.

SEN. CLINTON: Well, I don't know anything about that. You'll have to ask the foundation.

MR. STEPHANOPOULOS: But you're saying now it will not come out during the campaign?


MR. STEPHANOPOULOS: Let's go to another question from North Carolina. Let me take out my cards here to see what we have. Where is North Carolina there? Let's get them up on the card there?

SEN. CLINTON: It's a state over the -- (laughter).

MR. STEPHANOPOULOS: It is a state. That's right. And we have Renee Purvis (ph). She's a Democrat. She supports your, Senator Clinton. She's from Williamstown, North Carolina.

Q: Hi. Senator Clinton, my question is actually a follow-up to something you said at the State of the Black Union. You said that America will never be strong until the State of the Black Union is strong. Can you please share with me your accomplishments and also what your plans are to address the plight of black Americans?

SEN. CLINTON: Thank you, Renee. And I was honored to attend the State of the Black Union in New Orleans and to speak about what I would as your president. I feel very strongly about this. It has been one of the central missions of my adult life. I went to work for the Children's Defense Fund right out of law school, working for Marian Wright Edelman and have been committed to improving the lives of all Americans, but particularly those who have been marginalized or sidelined, and particularly for children. So I'm very grateful that I've played a small role over the years in helping to open up our public schools to children with disabilities, to reform education in Arkansas, to try to make it more equal, so no matter where you lived or where you were from, you would have that same opportunity, and to expand healthcare.

And we continued that because of course, my husband shares my passion for equality of opportunity in our country. And during the White House years, we saw the strongest economy. The people who benefit even more were people -- African-American, Hispanic, poor people who finally had a chance to lift themselves up and buy that first home, send that child to college, put on a typical basis for a family about $7,000 more of income into their pockets. We've got a lot of unfinished business, and my whole agenda is aimed at really making our country the land of opportunity truly again. You know, it hasn't been that for the last seven years.

So I've put forth a youth opportunity agenda that will go to help our young people, particularly in urban areas and rural areas where they often feel left behind. To have that universal healthcare system which will help all Americans, but particularly those without insurance or who face disparities in healthcare as so many African- Americans do. I want to make sure that we have an economy that really works, that means focusing on education, starting with preschool education. And North Carolina, your governor, Governor Easley has made preschool education for four-year-olds a big priority. And the reason that's important is we know a good preschool program will close the achievement gap between black and white youngsters by 50 percent. So I could go on and on. I've got lots that I want to do to make that happen.

MR. STEPHANOPOULOS: Despite this record, Senator Obama getting more than 90 percent of the African-American vote. Perhaps that's to be expected, it's virtually impossible for you to overtake him now in the pledged delegates. And a lot of people in the African-American community, including the third highest ranking member in the House, Jim Clyburn, say that if you overturn the will of the pledged delegates, it is going to cause an irreparable breach with the African-American community. Isn't that a problem?

SEN. CLINTON: Well, first of all I think both Senator Obama and I have made it very clear that we will have a unified Democratic Party going into the fall elections. I have said that I will work my heart out for him if he --

MR. STEPHANOPOULOS: How is that possible, if you overturn the will of the pledged delegates?

SEN. CLINTON: Well -- but George, you know, I've said that I would work my heart out for him. He has said he would do the same for me. So we will unify. There are a number of factors that people look at. We have delegates selected by millions of people in primaries, and delegates selected by a few thousand people in caucuses. I'm ahead in the popular vote, if you include Florida and Michigan.

MR. STEPHANOPOULOS: He wasn't on the ballot in Michigan.

SEN. CLINTON: Well, that was his choice and his campaign and the other campaign's --

MR. STEPHANOPOULOS: It was the rules of the DNC, though.

SEN. CLINTON: Well, but the rules -- I've said we shouldn't campaign, but there was nothing saying take your name off the ballot, and there was nothing saying that eventually we wouldn't give the voters, 2.3 million of them in Florida and Michigan a chance to participate in this process. The so-called automatic delegates, they have to make up their minds based on who they think would be the best president and the best candidate to go up against John McCain. That is the process.

So we're going to go through the next contest, and obviously we're looking forward to Indiana and North Carolina. And then when the process finishes in early June, people can look at all the various factors and decide who would be the strongest candidate. But I think there will be no doubt that however this turns out, we're going to have a very strong campaign in the fall. And I've often said that people who support me and they support me passionately, and people who support Senator Obama and support him passionately, they have much more in common than they do with Senator McCain and the Republicans. And that's something we want to drive home to every single person who cares about really taking our country back.

MR. STEPHANOPOULOS: We're going to take a quick break. We'll be right back with more with Senator Hillary Clinton, here in Indianapolis.


SEN. CLINTON: (From tape.) I think that since we now know Senator McCain will be the nominee for the Republican Party, national security will be front and center in this election. We all know that. And I think it's imperative that each of us be able to demonstrate we can cross the commander-in-chief threshold, and I believe that I've done that. Certainly Senator McCain has done that. And you'll have to ask Senator Obama with respect to his candidacy.

MR. STEPHANOPOULOS: We are back with Senator Clinton. And Senator, a lot of Democrats hear that and think all you're doing is helping John McCain in November.

SEN. CLINTON: Well, there is no doubt in my mind that we're going to be able to go toe-to-toe with Senator McCain on not only national security, but on the economy. But what I have been offering is my experience, and having served on the Senate Armed Services Committee for five years, I feel very comfortable taking him on. And I think that is a factor for voters to consider.

STEPHANOPOLOUS: But if you can say that Senator McCain --

SEN. CLINTON: But once we got --

MR. STEPHANOPOULOS: -- is qualified --

SEN. CLINTON: Once we get into -- well --

MR. STEPHANOPOULOS: -- why can't you say the same about --

SEN. CLINTON: I didn't -- I didn't --

MR. STEPHANOPOULOS: -- Senator Obama?

SEN. CLINTON: That's not what I said. What I said was that he would offer his experience and we know that he will offer his experience.

MR. STEPHANOPOULOS: Well, you said he's crossed the bar though.

SEN. CLINTON: Well, people will assume that because he served in the military, he served with distinction, and he was a POW. He will offer that experience. And I think that we have to have a Democratic nominee who can stand on that debate stage and go toe-to- toe with Senator McCain on national security. There's no doubt in my mind that he's going to run primarily a national security campaign again.

MR. STEPHANOPOULOS: Is Senator Obama qualified to be commander- in-chief?

SEN. CLINTON: Of course. I've said that he's qualified to be president on numerous occasions. The question is, how are voters going to determine who they vote for, you know, because that's going to be the real issue in the fall. And this is not in any way a comment about him; it's a comment about me. I feel like I am going to be able to stand up to Senator McCain. And I know him well and, you know, standing up to him is challenging, and I think we're going to be able to do that.

MR. STEPHANOPOULOS: Let's go to another voter question. Sharon Mahalick (ph) is here. She's an independent and she is undecided. Your question on national security.

Q: Good morning.

SEN. CLINTON: Good morning.

Q: Senator Clinton, as president your plan is to remove the troops from Iraq fairly quickly. If Iran then invades Iraq, what would your plan of action be?

SEN. CLINTON: Well, let me answer that because I think that this whole question about what we're going to do with Iraq will be in the centerpiece of the campaign in the fall because Senator McCain, as you know, has said that it would be fine with him to leave troops there for up to a hundred years, and he feels very strongly about that position, which he will convey with great passion and conviction.

I feel equally strongly that our troops have done everything they were asked to do. They got rid of Saddam Hussein, they gave the Iraqis free and fair elections, and they gave the Iraqi government the opportunity to do what it had to do to make the tough decisions about a responsible future going forward.

There is no military solution to our troops staying in Iraq. They could be there for years if the Iraqis do not decide that they must take responsibility. So when I am president I will ask the secretary of defense and the Joint Chiefs of Staff and my security advisors to draw up a plan that I can use to begin to withdraw our troops within 60 days. I know how difficult and dangerous this will be. I have no illusions about that.

But if we stay there and the Iraqis think they still have a blank check from us, they will never resolve their unfinished problems. They can't even decide how to allocate the oil revenues, which they've been saying they'll do for five years. So we will begin and we will go forward to withdraw our troops.

I've been endorsed by 35 retired generals and admirals, including the former adjutant general of the Indiana National Guard, who's here today, General George Buskirk. And when I was endorse by General Hugh Sheldon, and General Buskirk was with me, who was a former chairman of the Joint Chiefs of Staff, he said that he was endorsing me because he trusted me to end the war with Iraq -- in Iraq with honor.

What will Iran do? I don't think any of us can predict what Iran will do. But here's what I believe. I believe that if the Iraqis have to make their own decisions that the Iraqis will be much more nationalistic in defending their own country against Iran, which has a different --

MR. STEPHANOPOULOS: But what would you do?

SEN. CLINTON: -- social makeup, a different kind of culture, and I think that will give the Iraqis an organizing focus that they currently don't have.

MR. STEPHANOPOULOS: But what would you do -- I think that's what the question was -- if Iran went into Iraq?

SEN. CLINTON: You know, I do not believe Iran will go into Iraq. If Iran were to go into Iraq there would have to be a determination made at that time, but it is something that I am not anticipating. And we are not going to have permanent bases and permanently occupy Iraq because of some contingent that may or may not happen. Because it's not only what is not occurring in Iraq that bothers me, it is our failure to deal with all of our other problems. You know, Afghanistan is on the brink of basically being taken back over in large measure by the Taliban and al Qaeda. That's what our attention should be focused on.

And with respect to Iran, I have advocated vigorous diplomatic engagement. You see, we don't even really understand exactly how decisions are made in Iran because we have been so isolated from Iran. They have an elected leadership with Ahmadinejad, who's all over the TV. But I believe most decisions are made by the clerical leadership, the supreme leader that actually is responsible for the Revolutionary Guard. And we need to have a very intense diplomatic engagement with Iran --


SEN. CLINTON: -- and I've advocated that for several years -- in order for us to try to manage whatever the might do.

MR. STEPHANOPOULOS: But a lot of other experts look at Iran and they say there is a mass of Iranian people who want to be allied with the United States, want a democracy. And when they heard you say that if you Iran attacked Israel with nuclear weapons we would obliterate Iran, they say that undermines -- experts say that undermines exactly the kind of people we want to be encouraging in Iran.

SEN. CLINTON: Well, the experts I consult with don't say that, George, because here's what we're trying to convey. Number one, we have to do everything possible to prevent Iran from getting a nuclear weapon, and I will do that. It would be destabilizing and dangerous for the world if Iran were nuclear weaponized.

Number two, because of this split leadership and because of discontent among the people, we want to create some upward pressure that sends a very clear signal to the supreme leader and to Ahmadinejad and others that going forward on nuclear weapons is not a free choice for Iran. And the very idea that they would translate into action some of the most outlandish comments that have been made by some of the Iranian leaders and even contemplate wiping Israel off the face of the world means that we've got to make it clear to them that will not go without massive retaliation.

MR. STEPHANOPOULOS: You've also said we should extend our nuclear deterrent, including that threat of massive retaliation, to other countries in the region -- to Saudi Arabia, to Kuwait, to the UAE. And wouldn't that end up requiring a permanent U.S. presence in the Middle East that is even more extensive, would rival what we now have in Iraq?

SEN. CLINTON: But George, we have a permanent set of bases. We are in Kuwait. We're in Bahrain. We have our troops on the ground in other countries. Turkey is a NATO ally. We have a presence that predates our involvement in Iraq. And the reason we've been there all these years is to serve as a buffer, to serve as a check and balance on the originally designs of Saddam Hussein and on the potential threats from Iran. What I have --


(Cross talk.)

SEN. CLINTON: But what I've said is that if Iran continues to try to pursue a nuclear weapon, if you're sitting in one of the other capitals in the Gulf region and in the wider Middle East, you're not going to let Iran get that nuclear weapon. You're going to have your own nuclear weapons race.

MR. STEPHANOPOULOS: But the implications of that policy, as it was during the Cold War when we said an attack on Paris is like an attack on New York, is that an attack in Riyadh is the same as an attack on Indianapolis. Is that wise policy?

SEN. CLINTON: Well, George, you know, I go back and look at what we did during the Cold War. You know, I remember it very well because I'm old enough to have been told to get under my desk in case we were attacked by the Soviet Union. I never understood what that was about, but we all did it, remember? And we had a Cold War where each of us, the Soviet Union and the United States, had missiles on hair trigger alert aimed at the cities in our respective countries, and we deterred the nuclear conflagration that could have occurred by having tough diplomacy, by have presidents who really stood their ground who said, don't you dare think about this, and we will be very --

MR. STEPHANOPOULOS: But ultimately that was based on the idea that --


MR. STEPHANOPOULOS: -- they were rational. Do you believe President Ahmadinejad in Iran is rational?

SEN. CLINTON: Well, that's why they need to know -- see, that's the whole point of my argument here, George. You've really helped me out by making it even clearer.

We don't know exactly who makes the decisions in Iran. That's why we need this intense diplomatic effort to try to figure out who actually is, you know, saying what Iran will do. But there are -- the vast majority of Iranians who are rational, who get up every day, they go to work, they go to school, they love their families. We have to empower them both in a positive way, but also with a very clear message that their leaders need to be very careful about any kind of decision that they would contemplate.

MR. STEPHANOPOULOS: So who would be eligible to come under the U.S. nuclear umbrella and what would they have to do to get that protection?

SEN. CLINTON: The theory that I'm putting forth is we have to prevent Iran from getting a nuclear weapon. We have to prevent the proliferation of nuclear weapons throughout the region. Because I'm not so concerned about them falling into the hands of states, which is bad enough, as I am about falling into the hands of terrorists. Because what you just said about Iran -- Iran is a state. It's an institutional being. That's why it is deferrable. al Qaeda is not. So we cannot permit there to be proliferation of nuclear weapons.

So instead of having Saudi Arabia saying, well, you know, Iran and we are, you know, not on the same page here, we've got to have our own weapons, what we want to work toward is some kind of security agreement to prevent that proliferation. And we're talking about, you know, the potential deferrable effect of our being able to say, don't even think about it, Iran. I don't care who's making the decisions. Come join the rest of the world community. Be part of the world economy. Be part of us trying to have a more peaceful and prosperous future.

MR. STEPHANOPOULOS: Let's go back to North Carolina for another question. Larry Wooten (ph) is there. He's the president of the North Carolina Farm Bureau and he has important questions on food prices and energy. Go ahead.

Q: Senator Clinton, as you know, agriculture is important both in North Carolina and in Indiana. And lot of recent media reports have focused on the high cost of food and fuel and the impact that price increases are having on family budgets and on global demand for food. And some of these reports have even claimed that ethanol and biofuels are the reasons for these problems.

America's farmers want to be a part of the solution to our nation's energy concerns, and we take great pride in providing Americans and the people of the world with food and fiber.

What future role do you see, Senator, for farmers in our nation's efforts to reduce our dependence on foreign energy sources and how would you work as president to ensure that agriculture remains a vital part and a vibrant part of our state and nation's economy?

SEN. CLINTON: That's a great question, and it's rarely asked on national television. You know, we don't have enough conversation about agriculture and the importance of it. And it's one of these issues that I am trying to raise to higher visibility because, number one, we have a food crisis right now around the world. People are rioting because they are hungry in places like Haiti. It is projected that people will be starving if we don't figure out how we're going to get food to those who are in need. And the United States has to play a leadership role in this, and I would urge the president to do whatever we can to help the U.N. food program be able to deliver more food, and here in our own hemisphere we should try to help Haiti, which is, you know, really just in such desperate straits when it comes to food.

But what Larry does is raise the larger question. Number one, we've got to support agriculture here at home and around the world. I believe we've got to put more emphasis on our food supply and its security in a very unstable world. We also have to move toward biofuels, but we've got to do it in a way that doesn't contribute to boosting the prices --

MR. STEPHANOPOULOS: Isn't that the problem?

SEN. CLINTON: -- at the grocery store. Well, it's part of the problem. It's not the only problem. You know, with corn-based ethanol, and to a lesser extent soybean-based biodiesel, there has been a real pressure on cost because we've taken large parts of our agricultural productive land out of producing food to produce fuel. What we need to do is accelerate the research into farm waste and into other cellulosic plant materials. Because I think instead of using the corn, let's figure out if we can use the corncob, let's figure out if we can use the corn stalk. Let's figure out what other kind of food -- you know, waste we can use.

In the short run, we've got to work with our farmers and with like-minded people around the world to figure out how this increasing use in biofuels, which (is it ?) part of our answer to our dependence on foreign oil, does not undermine food production and really accelerate the prices. And again, if you go to my website, Larry, I lay out some plans and ideas about how to do that. But I want to be a good partner for agriculture because if we don't have strong family farms and good agricultural production here at home, we can't deal with either the fuel or the food crisis around the world.

MR. STEPHANOPOULOS: We're going to have to take another quick break. We'll be right back with more with Senator Clinton.


MR. STEPHANOPOULOS: And we are back with Senator Hillary Clinton. I want to get right to another voter question. Michelle Skinner (sp), are you there? Michelle attends Butler University. She's a Republican who is voting in the Democratic primary and is supporting Barack Obama.

Q: That's right. Senator Clinton, my question is, do you think that the discourse that's going on, the controversy with Reverend Wright, do you think this is relevant to Obama and his policy? Do you think this has accomplished anything or should we just -- should we drop it, should we move on?

SEN. CLINTON: Well, we should definitely move on. And we should move on because there are so many important issues facing our country that we have to attend to. And, you know, I have been very really energized by my travels around Indiana. People want to talk to me about gas prices and grocery prices and healthcare and the economy and everything that's on their minds as they sit around a kitchen table talking to their families. And we're electing a president to provide solutions to these problems. And that's why I've been very specific in talking about what I would exactly do, because I want you to hold me accountable. You know, I want you to say, okay, she said she would do this, she said she'd take on the oil companies, she said she would try to get us to universal healthcare, because we need to rebuild that accountability between our people and our president.

MR. STEPHANOPOULOS: So this shouldn't be part of the argument to superdelegates anymore?

SEN. CLINTON: Well, people, you know --

MR. STEPHANOPOULOS: Your campaign should stop that?

SEN. CLINTON: Well, people talk about it. There's no doubt they talk about it. But what people I think are most interested in is what we would do and what kind of president we would be because, you know, we are competing for the toughest job in the world. And everybody understands it's going to be especially hard after George Bush and Dick Cheney.

MR. STEPHANOPOULOS: But you don't want --

SEN. CLINTON: And I'm so glad to see a Republican coming over to our side. That's excellent. We're very happy about that.

MR. STEPHANOPOULOS: Rush Limbaugh is asking Republicans to come out and vote for you in order to divide the party.

SEN. CLINTON: He's always had a crush on me. (Laughter.)

MR. STEPHANOPOULOS: You know what, while we've been on the air here Senator Obama is giving an interview on another network and he --

SEN. CLINTON: That shall remain nameless.

MR. STEPHANOPOULOS: That shall remain nameless. And he took issue with your language on Iran which you were talking about a few minutes ago. He says your language about obliterate -- he said, it's not the language we need right now and I think it's reflective of George W. Bush.

SEN. CLINTON: Well, the question originally, as some may remember, was what would we do if Iran got a nuclear weapon and attacked Israel. And I think we have to be very clear about what we would do. I don't think it's time to equivocate about what we would do. They have to know that they would face massive retaliation. That is the only way to rein them in.

MR. STEPHANOPOULOS: So no regrets?

SEN. CLINTON: No. Why would I have any regrets? I'm asked a question about what I would do if Iran attacked our ally, a country that many of us have a great deal of, you know, connection with and feeling for all kinds of reasons, and yes, we would have massive retaliation against Iran. I don't think they will do that, but I sure want to make it abundantly clear to them that they would face a tremendous cost if they did such a thing.

MR. STEPHANOPOULOS: We have time for I think one more question from someone here, Steven Bain (ph). He's a Democrat. He's also undecided. And what is your final question for Senator Clinton?

Q: Hi, Senator Clinton. You were talking about how you would strongly support Obama and that he is very qualified for the position of president of the United States. Would you consider being his vice president or would you take him as yours?

SEN. CLINTON: Well, I think both of us have been asked that question and we have both said we think it's presumptuous and premature for us to answer it because obviously never of us has the nomination. But I am committed to doing whatever is necessary on my part to work hard, to speak out, to advocate if Senator Obama is the nominee, and he has said he will do the same for me. Whoever is the nominee will then have a chance to figure out who is the best running mate because we have to win.

You know, I just want to bring this back to the fundamental point, and as I've traveled across Indiana and even North Carolina, I've had so many Republicans come up and say they've changed their registration to be able to vote in our primary, many of them saying that they'll vote for me; others saying that, you know, they're undecided; and I know some like what we've just heard will vote for Senator Obama. Because no matter whether you're a Democrat or Republican, the lat seven years have been really hard on America. I mean, if you're wealthy, if you're well-connected, you've been taken care of, but that is not what's happening across our country. And when I go and sit in a living room like I did in Hobart and have a young man and his family tell me what they've gone through with his losing his job and losing their healthcare, I think it's time we had a president who's going to be a champion again for the American people, and that's what I intend to do.

MR. STEPHANOPOULOS: And that is all we have time for today, Senator Clinton. Thank you very much --

SEN. CLINTON: Thank you.

MR. STEPHANOPOULOS: -- for your time this morning.

SEN. CLINTON: Thank you, George.

MR. STEPHANOPOULOS: We'll be right back.

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