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CNN "The Situation Room" - Transcript


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Governor, thank you for being with us today.

GOV. MITCH DANIELS (R), INDIANA: Glad to be here.

CROWLEY: Appreciate it. I want to start off talking a little bit about the Republican field which you chose not to join, and ask you to size it up for me. You're watching from afar as most Americans are watching right now. They're not as intensely involved as, say, reporters and...

DANIELS: Maybe further than some of them, yes.

CROWLEY: Who do you think is standing out at this point in the Republican field?

DANIELS: Well, I don't have anything original to say. I think the two governors, Romney and Perry, seem to be getting the most attention and for the moment at least seem to be the dominant personalities in the race.

CROWLEY: I wanted to play you something that Mike Huckabee said about Governor Perry's performance in this past debate.


MIKE HUCKABEE (R), FORMER PRESIDENTIAL CANDIDATE: I think Rick Perry is not prepared for the pressure of the presidential stage yet. Rick Perry has got a struggle ahead of him.


CROWLEY: Now you add to this that The Weekly Standard, a conservative publication, called it almost disqualifying, speaking of Perry's performance in the debates. He seems to be fading partially because running for governor is not the same as running on the national scene.

Do you envision a Republican Party that at this point would pick Rick Perry?

DANIELS: Yes, maybe. I think it's way too early to know or to issue -- pronounce last rites over one performance. There are so many of these -- too many maybe. And so let's -- he hasn't been in it that long. I understand what Governor Huckabee was saying, but I'd cut him a little slack, give him a little time.

CROWLEY: One of the things that you have said over time is that you've been a little disappointed of the things the Republican field has chosen to take up. The things that they're saying. What in particular do you think they're not talking about?

DANIELS: I don't think they're yet talking about the things that the two senators just spoke to, you know, the things that have a lot of zeros attached to them, the ones that are threatening to kill not just an economy but the entire idea of America, the idea of upward mobility from the bottom and tomorrow is better than today.

And so I'm hoping that things will evolve. I'll tell you what's bothering me a little bit, Candy, the president is clearly in very desperate political shape. And it seems more clear every day. And I worry a little bit, ironically, that the Republican field or our nominee might look at that and say, I'll just play it safe, I'll get elected as the default option, you know, he made it worse, I'm not him, vote for me.

And that will be, I think, a huge missed opportunity because there's a clock ticking. This is not a philosophical argument I make in this book or anywhere else, it is arithmetic. And very encouraging, by the way, to hear a guy like Senator Warner speak to it as clearly as he just did. I wish he were president.

And so I just hope...

CROWLEY: There's a little bipartisanship there, a little bit, right? A Republican governor.

DANIELS: It's going to take that. You know, the Brits have a great saying, now that the money has run out we shall have to begin to think. And I just hope that even though the chances of electoral success next year look pretty good to me and better all the time, next year I think should be seized as an opportunity to talk with all our fellow Americans about this common problem.

It threatens us all, left to right, R and D. And I hope our party -- I mean, this president is not going to do it so it has to be our nominee.

CROWLEY: In fact, you said in your book, that debt -- U.S. debt, that's what we're talking about here, is more likely to sink democracy or personal freedom than in previous times when the Soviet nuclear threat was seen as the big danger to democracy.

Just explain that in terms of what happens if we have a debt? Because there is this feeling that, well, debt doesn't actually matter that much, there doesn't seem to be that kind of urgent -- there's politics to it, that's where the politics are right now, but is it where the urgency is?

DANIELS: Well, it needs to be. Because it is a mathematical fact that we are headed for debt levels we cannot sustain. In simple terms...

CROWLEY: Well, what would that mean practically speaking?

DANIELS: In practical terms it would mean that the mortgage payments, just the interest payments that we are making as a federal government, not to mention states and even private citizens, is consuming so much money there is not enough left to hire anybody.

It is consuming so much money on the public side, by the way, that public education will be devastated. And so -- and it means... CROWLEY: So lower money -- higher interest rates for -- on everything, and less money to spend on things we might want to spend on.

DANIELS: Too much money going to the mortgage and not enough to pay the rest of the necessities of life. It is very clear, and, again, it is not ideological in any way, it is very clear that nations that go past a certain point of debt do not recover.

You know, the heart of my concern has to do with the promise of America and we're starting to see that fraying around the edges. And without an America in which people really believe, that even if things are tough today, they are going to be better, and my kids will live better, without a stable, hopeful middle class, we'll lose something even more precious than material well-being, we'll lose the self- governance that we've brought to the world.

CROWLEY: The underlying premise of your book, "Keeping the Republic: Saving America by Trusting Americans," is that Americans will step up to the plate if you just tell them the truth, if you lay it out for them. Who is not telling the American public the truth and what is the truth, as you see it, that we can handle?

DANIELS: Well, the truth is that we just talked about the first -- again, arithmetic fact. It's not a matter of opinion, it's math. Secondly, that we cannot possibly continue on with the safety net programs we have in exactly their current forms.

CROWLEY: Social Security, Medicare, Medicaid.

DANIELS: That's right. That's right. We can say to today's and even those entering the program, today's seniors and those entering in the next few years, don't worry about a thing, nothing changes for you, you are good to go, a deal is a deal.

Now, please join with us and let's create new programs starting in the future that mean that the young people who are paying for your retirement have some protection, too. And those programs will have to look different. They will have to stop sending checks to the wealthiest citizens, for instance. But, you know, this is what Mark Warner was talking about and Senator Alexander, and, you know, the sooner people from both sides concentrate on that problem and then all the rest of the grossly excessive federal government spending that we're doing, the sooner we can get on the way to an economic recovery.

CROWLEY: Indiana Governor Mitch Daniels, thank you for joining us. The book is "Keeping the Republic." I appreciate your stopping by.

DANIELS: Thank you.


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