Transcript: President Barack Obama, Part 2

On Thursday, Nov. 4, 2010 - two days after midterm elections - "60 Minutes" correspondent Steve Kroft interviewed President Barack Obama in the Oval Office. Below is a transcript of that interview. The video of this interview is also available on this Web site.

KROFT: The political landscape has changed. I mean, how do you plan to govern? President Clinton found himself in a very, very similar circumstance. And he reacted by pivoting to the middle, turning to the middle. And was successful at it. Is that what you're gonna do?

PRESIDENT OBAMA: Well, I when I . . . .

KROFT: You have to, don't you?

PRESIDENT OBAMA: What I'm gonna do is I'm gonna reach out to Republicans and I'm gonna say, "What can we work on together?" There are gonna be some things that we can't agree on. You know? Philosophically. And so, we will have those battles. And we'll save those decisions till after the next election. But in the meantime, there must be some things we can agree on.

Obama Interview Transcript, Part 1
Obama Interview Transcript, Part 2

PRESIDENT OBAMA: Well I have, but I'm gonna keep on trying. And I'll give you an example that I mentioned yesterday at the press conference in energy. I think that you know the Republicans don't want to see some big comprehensive climate change bill. On the other hand, we can agree that we should be developing our natural gas resources more than we're doing. We can agree that making sure that electric cars are built here in the United States as opposed to just in Asia and Europe, make sense.

We can agree that a renewable energy standard that encourages things like biofuels could end up being an important component of our energy economy. We can agree on the idea of energy efficiency. Retooling our schools and our hospitals and other institutions so that they're using energy more efficiently, which drives down prices for everybody. You know, those are areas where we should be able to agree.

And what I'm gonna constantly be looking for are areas that draw from the Democratic ideas, Republican ideas to find that commonsense center, where we can move the country forward. Even though we'll still have some, you know, big disagreements and big debates on other issues.

KROFT: You said at a cabinet meeting you wanted to move forward on the people's agenda. Which people? The people who elected [incoming Florida Republican Senator] Marco Rubio and [incoming Kentucky Republican Senator] Rand Paul, or the people that reelected [Senate Majority Leader and Nevada Democrat] Harry Reid and [California Democrat and outgoing Speaker of the House] Nancy Pelosi?

PRESIDENT OBAMA: All people. You know it's interesting, while I was campaigning, even in this very partisan environment, the single line that always got the biggest applause, even in big, Democratic rallies, was, "Although we are proud to be Democrats, we are prouder to be Americans." And my expectation is that Republicans feel the same way.

And so there are huge overlaps in the interests of ordinary folks, whether they're Democrat or Republican. They want to make sure our schools are working. They want to make sure we've got the best scientists and engineers in the world. They want to make sure that we're competitive internationally. And what they don't want to see us do is to sit here for the next two years, having a long, drawn out political argument. When other countries are racing past us. I promise you, that's something that you know, whether you're a Democrat or Republican you know we just can't afford.

KROFT: No one at the news conference yesterday asked you about the Tea Party. According to the exit polls, four out of ten voters on Tuesday said they supported the movement. How seriously do you take the Tea Party, and will it make the task of finding common ground with the Republican Party more difficult?

PRESIDENT OBAMA: Well, it'll be interesting to see how it evolves. We have a long tradition in this country of a desire for limited government, the suspicion of the federal government, of a concern that government spends too much money. You know? I mean, that's as American as apple pie. And although, you know, there's a new label to this, I mean those sentiments are ones that a lot of people support and give voice to. Including a lot of Democrats.

And so, the test is gonna be what happens over the next several years, when it's not just an abstraction, but we have to start making serious choices. I've got a deficit commission that I've put forward that is gonna be releasing recommendations for how we can start reducing the deficit. And I don't know yet what they're gonna say, but I do know what the federal budget looks like. And if you eliminate all the earmarks. If you eliminate all the foreign aid. If you eliminate all the waste and abuse that people, you know, talk about eliminating -- you're still confronted with a fact that the vast majority of the federal budget are things that people really think are important. Like Social Security and Medicare and defense.

And so, you then have to start making some tough decisions about how do we pay for those things that we think are important? And you know, we're not gonna be able to balance the budget just by slashing the National Parks budget, even if you didn't think that was a proper function of government. We're not gonna be able to balance the budget by, you know, eliminating the National Weather Service.

I mean, we're gonna have to, you know, tackle some big issues like entitlements that, you know, when you listen to the Tea Party or you listen to Republican candidates they promise we're not gonna touch.

I'll give you another example. We've probably done more than any Administration over the last 20-30 years when it comes to increasing veteran spending. Because we've got over a million folks who've served in Iraq and Afghanistan who've come back with post-traumatic stress disorder you know, traumatic brain injury.

And I think I've got a sacred trust as Commander in Chief -- and I think most Americans feel we've got a sacred trust -- to care for these veterans. Well, that's expensive. And if we're not spending that money to take care of them, what does that say about us, as a country. And if we are, we've gotta find a way to pay for it. And those are the choices that I think if you lay out a budget, Republicans and Tea Party members are gonna have to confront in a serious way.

KROFT: One of the first chances you're gonna get to show a spirit of cooperation is on the Bush tax cuts, which are set to expire at the end of the year. You've said that you want to keep 'em in place for the middle class. You want them to expire for the wealthier Americans. The Republicans want to keep them for everybody. Are you ready to compromise on the Bush tax breaks?

PRESIDENT OBAMA: I think we're gonna have to have a serious conversation about it. Here's an example where I'd like to think we could at least settle on those things we agree on. I think both Democrats and Republicans agree that for people making $250,000 a year or less, the last thing we want right now is to see their taxes go up. Not only would it be bad for them, but it'd be bad for the economy as a whole. Because those are the folks who are most likely to spend. And a lot of them are having trouble paying the bills. So, we don't want to make it harder on them. We want to make it easier on them to be able to participate effectively in the economy. For folks who are making more than $250,000 a year, you and me, Steve you know, the question is, can we afford to borrow $700 billion.

KROFT: That's what it is?

PRESIDENT OBAMA: That's how much it would cost over the course of ten years. To give us an extra tax break. Or does it make sense to say to us, "You know what? After the first $250,000, your tax rates are gonna go back to what they were under Bill Clinton." When, by the way, rich people were doing pretty well.

Sometimes I think this debate gets framed as if I think rich people, folks who are doing well, should be punished.

KROFT: Well, I . . .

PRESIDENT OBAMA: Part of what America's all about is going out there and getting rich. And, you know, if you make a good product, you provide a good service, God bless you. I want you to do well. Then you can plow that money back into creating jobs. And building your businesses. That's terrific. What I don't think makes sense is for us to borrow $700 billion to pay for that. And we don't have the money. I mean, everybody's already talking about our debt and our deficit. Why would we want to add to it? Now, having said all that . . .

KROFT: The Republicans want everybody . . .

PRESIDENT OBAMA: I understand the Republicans have a different view. And so, we are going to have to have a negotiation. And I am open to you know, finding a way in which, you know, they can meet their, you know, principles and I can meet mine. But in order to do that, I think we do have to answer the question of how we pay for it. If in fact we're gonna extend these tax cuts, then we've got to figure out what does that mean for our debt and our deficit. Because there's no gettin' getting' around it. It's gonna cost $700 billion to extend those . . .

KROFT: Over ten years.

PRESIDENT OBAMA: Over ten years. Yeah.

KROFT: Congressman Boehner is the next Speaker of the House, most likely, offered you a compromise back in September. He suggested extending the tax break for the wealthiest for two more years. And rolling back discretionary government spending to levels before the bailout in 2008. Is that something that you could live with?

PRESIDENT OBAMA: I think that when we start getting specific like that, there's a basis for a conversation. I think that what that means is that, you know, we can look at what the budget projections are. We can think about what the economy needs right now. Given that it's still weak. And hopefully, we can agree on a set of facts that leads to a compromise. But my number one priority coming into this is making sure that middle class families don't see their tax rates go up January 1st.

KROFT: Do you want to make a counter proposal to him right now?

PRESIDENT OBAMA: I've already invited them over to the White House. And you know, there're gonna be a bunch of discussions. But I think we can make progress on this. It's not, by the way, just tax cuts for individuals that we're concerned about. There are also a bunch of provisions for businesses in terms of how business investment is treated. If they're investing in research and development here in the United States and what kind of tax breaks do they get on that. We need to provide businesses certainty on that. We've got to do before the end of the year. And my hope and expectation is that we can solve this problem.

KROFT: The point of view of a lot of people is, why would you want to raise taxes on the people who have money to spend? Not necessarily the wealthiest people in America. You're not talking about Goldman Sachs here. You're talking about small business people who maybe make $250,000 a year.

PRESIDENT OBAMA: Well . . .

KROFT: Why would you want to take that money back, when they've got money to spend to put it into the economy?

PRESIDENT OBAMA: Well, well, keep in mind, first of all, that under the proposal we put forward, folks who make $300,000 a year, would still get tax breaks up to $250,000. So, the majority of their taxes would still be low. It'd just be the amount over $250,000, where they'd go back to the Clinton tax rates.

The truth is that the way this thing works out, it's folks who are millionaires and billionaires who get the biggest breaks. And, you know, if you talk to Warren Buffett, he'll tell you, "I'm not gonna buy somethin' because of a tax break, because whatever it is I need, I can already afford." And the same is true for me. And the same is true for you.

And it turns out that actually the people who are most likely to use that money and spend that money are actually people of more modest means, and if what we're concerned about is how we can grow the economy, there are more efficient ways to recirculate dollars out there and get people to spend.

I mean unemployment insurance, most economists will tell you, is probably the single most important thing we can do to improve the economy, because if you're unemployed, you're out there looking for work, that unemployment insurance is gonna make a difference as to whether or not you can pay your bills.

KROFT: You've, I would say, don't have a very close relationship with Mr. McConnell, [Kentucky] Senator [Mitch] McConnell and Congressman [John] Boehner [of Ohio]. What do you think of these guys?

PRESIDENT OBAMA: You know, I think that both John and Mitch are very smart. They're capable. They have been able to, I think, organize the Republican caucus very effectively in opposition to a lot of the things that we tried to do over the last two years. And that takes real political skill.

And I believe that they want the best for the country just like I do. Just like Democrats do. So you know, my assumption is that we're gonna be able to work together. And whenever we've had conversations here at the White House or over on Capital Hill, they've always been cordial.

KROFT: It's just in the newspapers that they've been . . . .

PRESIDENT OBAMA: Well, you . . . .

KROFT: . . . less than cordial.

PRESIDENT OBAMA: Okay, during election season, I think the rhetoric flies. And by the way, I've been guilty of that. It's not just them. And you know again, this is an example, you asked me earlier, of what I reflect on. I reflect on the fact that part of my promise to the American people when I was elected was to maintain the kind of tone that says we can disagree without being disagreeable. And I think over the course of two years, there have been times where I've slipped on that commitment. And that's something that I've got to make sure that I'm checking on an ongoing basis, making sure that my rhetoric matches up with my expectations for myself and the expectations of my supporters.

KROFT: But there is this feeling particularly among people who are among your most ardent supporters, who feel a little disappointed that they think that they've lost your mojo. That you've lost your ability, that touch you had during the campaign, to inspire and lead.

You know, everybody in Washington writes about sort of aloofness that you have. And I'm sure that drives you crazy. How do you respond to that? People have made the argument you lost control of the narrative. You've let other people define you. That you haven't sold your successes well enough.

PRESIDENT OBAMA: I think that's a fair argument. I think that over the course of two years -- and I mentioned this during the press conference -- we were so busy and so focused on getting a bunch of stuff done that we stopped paying attention to the fact that we yeah, leadership isn't just legislation. That it's a matter of persuading people. And giving them confidence and bringing them together. And setting a tone. And making an argument that people can understand. And I think that we haven't always been successful at that. And I take personal responsibility for that. And it's something that I've got to examine carefully as I go forward.

You know, now I will say that when it comes to some of my supporters, some of my Democratic supporters who express some frustration, part of it, I think, is the belief that if I just communicated things better, that I'd be able to persuade that half of the country that voted for John McCain that we were right and they were wrong.

And, you know, one of the things that I think is important for people to remember is that, you know, this country doesn't just agree with The New York Times editorial page. And, you know, I can make some really good arguments defending the Democratic position, and there are gonna be some people who just don't agree with me. And that's okay. And then we've got to figure out a way to compromise. But even as we acknowledge that, this is a big country. And that, you know, there are conservatives who are good people, who feel very strongly about their ideas. That I'm never gonna persuade on some issues.

I think what's still fair to say is that I can do better than I've done in painting a picture for people about where we need to go. That pulls people together as opposed to drives them apart. And that's one of my central tasks over the next couple of years.

KROFT: Do you have any specific unemployment goals? I mean, is there a point where you would like to say, "Well, we be down by eight percent or nine percent by the end of the year?"

PRESIDENT OBAMA: Well look, I would love to have zero unemployment at the year. The question is, what's gonna be achievable over the next year or two. I mean, you remember one of the things that we got in trouble with -- and this is an example of, 'are there some things you'd do differently' -- we made an estimation that unemployment would peak at eight percent when we were still at the beginning of the crisis.

And we just kept on goin' north of that in a few months. That's at a time when economists just didn't realize how quickly companies were gonna be sheddin' jobs. And that actually hurt our credibility around the country, 'cause people started sayin', "Well gosh, you said if we passed The [American] Recovery [and Reinvestment Act of 2009], unemployment would peak here and it's already gone up to here."

Well, it wasn't because The Recovery Act didn't work; it's because the modeling, in terms of what to expect where unemployment would go to, turned out to be wrong. So, you know, I don't wanna pretend like I've got a crystal ball.

Here's what I wanna see, is that the economy is growing enough that each month we're seeing a lower unemployment rate, more jobs are being created than people who are coming into the workforce, so that people get confidence that there's a steady reduction in the unemployment rate.

And if we're doin' that, then, you know, over the course of the next year or two I think we can make real progress, and people are gonna be able to say to themselves, "It's worth me investing in a new plant because unemployment's low. I think there are gonna be customers out there. I'm gonna open up a new store because I'm pretty confident people are gonna be shoppin'." You know, that virtuous cycle is what I think we're strivin' for, and that's gonna require more work.

KROFT: There is a perception out there that you're anti business. Are you planning on putting some small business people, some people with business experience in the White House?

PRESIDENT OBAMA: Well, I think there's no doubt that the relationship with the business community over the course of the last two years at times has gotten strained. Part of it had to do with the fact that we were dealing with crises in various business sectors that required some tough choices.

I mean, you know, the banking sector and dealing with things like AIG didn't always endear me to Wall Street. You know, we had to go in and revamp the auto industry in a way that made it seem as if the normal relationship between government and business had changed too much, and government was exerting too much power.

And so I think that we've got some repair work to do there. And as I said in my press conference -- you know, the key to the American economy has always been the dynamic private sector that creates jobs. I would love a situation in which the private sector is off and roaring and movin' and, you know, the government is playing a much more limited role in the economy.

These were exceptional circumstances over the last two years. I think we have to make sure that people understand and business understands that my overarching philosophy is not one in which we have constantly increasing government intervention. Although I do think that some of the provisions we put in place to protect consumers, to create a regulatory framework where we don't have a repeat of the kinda crisis we had in the banking sector, those have to be preserved.

KROFT: You've got a situation right now that banks have not significantly loosened up credit in spite of all the money that they've received, in spite of the fact that they're quite profitable right now. And you've got manufacturing companies that haven't replaced many of the jobs or hired back the people that they've cut. How do you get the banks to loan money, and how do you get businesses to hire people back?

PRESIDENT OBAMA: Well, it starts with businesses wanting to hire people back because they see customers out there. And so everything that we can do to expand consumer confidence, everything that we can do to get businesses to invest in plants and equipment through the tax code, through accelerated depreciation, through keeping taxes on middle class families where they are, as opposed to having them spike up -- all that can make a difference. The more companies are doing well, the more likely they are to go to banks and say, "We need to borrow."

Now the one group that I think we have to make some extra effort on are small businesses, because a lot of them are eager to grow, but still just are having trouble gettin' credit. The big companies aren't havin' trouble borrowing from banks, but small companies are.

And that's why it was so important a couple of months ago for us to pass a bill for small businesses specifically that said, you know, "We're gonna give low-rate financing to community banks that are more likely to lend to small businesses, as long as they're actually lending it to the small businesses." And we've already seen a huge uptake in small businesses taking up those loans, which is gonna be real helpful because small businesses create a lotta jobs in the economy.

KROFT: We talked about some of the criticism that this presidency and you personally are seen as being very insular, closely held. Is it time to expand that circle? Well, you've got some jobs you have to fill.

PRESIDENT OBAMA: We do, and I think there's no doubt that over the next two years, I've got to make sure that that same spirit of openness and engagement with the American people and all sectors of the economy is a focus. As I said, you know, I think because we came in during crisis, we had sort of a narrow-tunnel vision on just getting the job done.

Well, part of the job is engaging people -- listening, making sure that they feel that they're bein' heard, gettin' out of here, gettin' out of the White House, gettin' out of Washington. And you know, that's not just good by the way in terms of developing policy -- 'cause I think a lotta people have good ideas -- it's good for me. It's good for my spirits, good for my soul.

You know, the thing I enjoy most about the presidency is when I've got a chance to interact with folks in a backyard town hall, in you know, buyin' some donuts in a store. You know, that's when things aren't scripted, that's when you're not, you know, spending all your time just goin' through a bunch of talkin' points.

That's when I get most optimistic about America because I'm reminded of how wonderful this country is and how diverse it is, and for all the arguments we have, how our core values are widely shared across this country. And we should be able to pull together to do better than we're doin' right now.

KROFT: You're halfway through --

PRESIDENT OBAMA: Uh-huh.

KROFT: -- your first term. What's the most important thing you've learned about your two years here, about yourself, about the job?

PRESIDENT OBAMA: I think that I've learned that America is incredibly resilient. We went through as bad of a financial crisis as anything in our lifetimes. And you know, the country has bounced back. It's not bounced back all the way, but people are tough, and folks work hard, and they're not easily shaken. It has been so impressive to me the way folks have been able to just keep goin' about their business. Some of them in very difficult circumstances.

I think I've learned about myself that I'm pretty resilient too. I'll get knocked down a couple of times. But when I read letters about folks who've lost their jobs and haven't been able to find one, sent out resume after resume, and then finally after a year and a half, they get hired, you know, that inspires me. It says to me, "You know what, whatever I'm goin' through, it's nothin' like what families around the country are goin' through. And if they are able to keep goin' even when things don't go the way they want then I sure can as well."

KROFT: Do you get discouraged? Are you discouraged now?

PRESIDENT OBAMA: No you know, I do get discouraged, I mean, there are times where you think, "Dog-gone-it you know, the job numbers aren't movin' as fast as I want." And you know, I thought that the economy would have gotten better by now. You know, one of the things I think you understand -- as president you're held responsible for everything. But you don't always have control of everything. Right?

And especially an economy this big, there are limited tools to encourage the kind of job growth that we need. But I have fundamental confidence in this country. I am constantly reminded that we have been through worse times than these, and we've always come out on top. And I'm positive that the same thing is gonna happen this time.

You know, there are gonna be setbacks, and we may take two steps forward and one step back, but the trajectory of this country is always positive. And that's something that that prevents me from getting too discouraged.

KROFT: You seem to feel that things are getting better. I sense that. One of the things that drives business crazy is this idea that they don't know what's going on. They have trouble planning. They don't know what the tax rates going to be

PRESIDENT OBAMA: Right.

KROFT: They're not convinced that things are getting better.

PRESIDENT OBAMA: Right. Well there are two separate arguments here. I think a lot of businesses still don't know what the economy is doing. They don't know, are consumers gonna start buyin' again? You know, are we gonna start getting the virtuous cycle, where because businesses start hiring, the people who get hired start shoppin', which means other businesses are hirin', and everybody starts feelin' better about the economy.

There's still a lotta uncertain data out there. And we're still workin' through some big problems of the economy. The housing market is a huge headwind. I think there was actually a lot of optimism back in April right before the Greek crisis, when suddenly a lotta companies who were planning to hire kinda pulled back and said, "Gosh, there may still be a lotta, you know, uncertainty in the global financial market."

So I do think that businesses have not yet committed to the kind of expansion that would involve a lotta hiring because they're nervous [that] maybe we're not completely out of the woods yet. And part of my job is to work with them to inspire that confidence.

Now, the second part of uncertainty, and this is the one that the Republicans focused a lot on during the campaign is, we've got a new healthcare law, we've got a new financial regulatory reform law. We don't know what all these regulations coming out of various agencies might be, and so that's making people hesitate.

And you know, I think that it is entirely legitimate that in the banking sector, it's very important for us to write these rules in collaboration with interested parties so that they can start knowin' how things are gonna work. When it comes to healthcare, we need to be consulting with the insurance industry to make sure they know how things are gonna work.

On the other hand, you know, Apple computer is makin' an awful lotta money right now under the exact same laws as some other companies. And the main reason they're makin' a lotta money is 'cause people are buyin' a lotta iPads. You know Caterpillar's sellin' an awful lotta big machinery and makin' good profits because they know there's some demand there.

So I think it's important for us to work to reduce regulatory uncertainty. I think it's important for us to see are there ways we can eliminate red tape when it comes to how businesses interact with government. I think getting things like the R&D tax credit for businesses, you know, settled, makin' that permanent so that people can start makin' investments, I think that's somethin' that's very important.

But probably the biggest uncertainty right now for a lotta companies is there gonna be enough demand out there for the products, and we've gotta make sure that we're workin' with them to try to improve that.

KROFT: Thank you Mr. President.

PRESIDENT OBAMA: Alright.

KROFT: Oh I have one thing.

OBAMA: Oh oh oh, wait, wait, wait - there's one more question . . . alright, go ahead.

KROFT: It's my own fault.

OBAMA: I'm going to give you one this last one cause you're excited about this one.

KROFT: One of the complaints has been that you've appeared on Comedy Central The View. They think it trivializes the president. I don't know if you saw this cartoon [Steve Kroft shows President Obama a political cartoon from the Daily News.]

PRESIDENT OBAMA: Let me take a look at it.

KROFT: Body by Bam.

PRESIDENT OBAMA: Body by Bam.

KROFT: From The Daily News.

PRESIDENT OBAMA: The challenge right now, and you know this better than I do, Steve, is that it used to be a President could call a press conference, and the three major networks would come, and he'd talk to 'em, and you pretty much reached everybody in America. And these days the closest I can get to that is bein' on 60 Minutes.

But there are a whole bunch of folks you know, unwisely on their part, who don't watch 60 Minutes, who watch The Daily Show¸ or watch The View. And so I've got to adapt the presidency to reach as many people as possible in as many settings as possible so that they can hear directly from me.

This is an example of where, you know, on the one hand folks say, "Well, you know he's a little too remote." Then if I'm on The View, "Well, you know, he shouldn't be you know on some daytime TV show you know, he should be a little more imperious."

And, you know, I guess my attitude is if I'm reaching people, if I'm talkin' to 'em. If I'm engaged with 'em, whatever the venue, then hopefully that makes people a little clear about what it is that I'm trying to do, and understand the challenges that we face. And so I'm willing to take the risks of overexposure on that front.

Click here for part 1 of the transcript.