November 22, 2011: CNN / Heritage Foundation / American Enterprise Institute Republican Presidential Debate Transcript

Republican Candidates Debate in Washington, DC November 22, 2011

PARTICIPANTS:
Representative Michele Bachmann (MN);
Herman Cain (GA);
Former Speaker of the House Newt Gingrich (GA);
Former Governor Newt Gingrich (UT);
Representative Ron Paul (TX);
Governor  Ron Paul (TX);
Former Governor  Ron Paul (MA); and
Former Senator Rick Santorum (PA)MODERATOR:
Wolf Blitzer (CNN)

BLITZER: From Constitution Hall in the nation’s capital, this is the Republican presidential debate.

[applause]

BLITZER: Every U.S. president since Calvin Coolidge has been inside this historic hall, just steps away from the White House.

Tonight, the eight Republican candidates are here with their ultimate goal in sight.

I’m Wolf Blitzer.

We want to welcome our viewers in the United States and around the world.

Tonight’s debate is airing on CNN, CNN International, CNN en Espanol and the American Forces Network. We want to thank our co- sponsors, the Heritage Foundation and the American Enterprise Institute.

Members of these distinguished conservative think tanks, they are here in our audience and some of them will have a chance to question the candidates. They’ll add their knowledge and insights to our discussion, making this unlike any debate so far in this presidential campaign.

Viewers also can take part in our debate by sending us your questions online, on Twitter. Make sure to include the hash tag, cnndebate; on Facebook at Facebook.com/cnnpolitics; and, of course, on CNNPolitics.com.

It’s time now to meet the 2012 Republican presidential contenders.

Joining us onstage, the former U.S. ambassador to China, Jon Huntsman.

HUNTSMAN: Thank you.

Thank you very much.

Thank you.

Thank you. [applause]

HUNTSMAN: Thank you.

BLITZER: Minnesota Congresswoman Michele Bachmann.

BACHMANN: Good to see you, Wolf. [applause]

BLITZER: The former speaker of the House, Newt Gingrich.

[applause]

BLITZER: The former president and CEO of Godfather’s Pizza, Herman Cain. [applause]

The former Massachusetts governor, Mitt Romney…[applause]

Texas governor, Rick Perry…[applause]

Texas congressman, Ron Paul…[applause] [inaudible] from Pennsylvania, Rick Santorum. [applause]

Ladies and gentlemen, the Republican candidates for President of the United States. [applause]

Now, please rise for our National Anthem. Please rise. The National Anthem performed by Mauricio Perez, from the Tony Award winning musical, “Jersey Boys,” now playing at the National Theater here in Washington, D.C. [applause] [national anthem] [applause]

BLITZER: Mauricio Perez, thank you.

Candidates, please take your — to your podiums while I tell you a little bit more about how this debate will work. I’ll be the moderator and as I mentioned, our partners from the Heritage Foundation and the American Enterprise Institute will ask questions as well.

I’ll follow up. I’ll try to guide the discussion. Candidates, I’ll try to make sure each of you gets your fair share of questions.

You’ll have one minute to answer, 30 seconds for follow-ups and rebuttals. And I’ll make sure you get time to respond if — if you’re singled out for criticism.

This year more than ever we’ve seen how events beyond our borders directly affect America, including perhaps the biggest national security issue right now, the economy.

Candidates, tonight Republican voters are here. They are watching around the country to decide if you have what it takes to be the next commander in chief, to shape foreign policy, to protect this great nation.

On some of these issues you will agree. On some you’ll disagree. But by the end of the night, voters should have a better understanding of how you would lead the nation in times of crisis.

Now, let’s have the candidates introduce themselves to our audience, but we’ll keep it very brief. Here’s an example of what I’m looking for.

I’m Wolf Blitzer and yes, that’s my real name. I’ll be your moderator this evening and I’m happy to welcome each one of you to our debate.

Rick Santorum, let’s begin with you.

SANTORUM: Well, I am Rick Santorum. And it’s great to be here and I want to thank AEI and Heritage [inaudible]. … One constitutional responsibility of the federal government and that is national security. And I think we can all agree that if you like what Barack Obama has done to our economy, you’ll love what he’s done to our national security.

PAUL: I’m Ron Paul, a congressman from Texas. I am pleased to be here at the debate because this is a very important debate. I am convinced that needless and unnecessary wars are a great detriment. They undermine our prosperity and our liberties. They add to our deficits and they consume our welfare. We should take a careful look at our foreign policy.

PERRY: I’m Rick Perry, the governor of Texas, and I want to take a moment and introduce you, the beautiful first lady of the state of Texas, Anita. Thank you for being here with me, 29 years of wedded bliss and 45 years ago we had our first date. So I’m a blessed man in many ways to represent a great state, and we’re here to ask you for your support, your blessings and your vote.

ROMNEY: I’m Mitt Romney and yes, Wolf, that’s also my first name. And…[laughter]… I’m a husband, a father, a grandfather of 16. I love this country very much. I spent my life in the private sector. And as I’ve watched the direction this president has taken our country, both domestically and internationally, I’m afraid that he’s taking us on a perilous course. I want to keep America strong and free, and if I’m president, I’ll use every ounce of my energy to do just that. [applause]

CAIN: I am businessman Herman Cain. I’m delighted to be here to discuss one of the most critical issues we face because, as a result of this administration, our national security has indeed been downgraded. [applause]

GINGRICH: I’m Newt Gingrich. My father spent 27 years in the infantry. And as a result of that, in the fall of 1958, I decided that national survival was worth the study of a lifetime. I’ve worked with both Heritage and the American Enterprise Institute for over 30 years. I can’t imagine any two institutions better to partner with CNN on the most important single topic, the survival of the United States. [applause]

BACHMANN: My name is Michele Bachmann. I’m a proud member of the United States Congress. I’m privileged to serve on the House Select Committee on Intelligence. My father honorably served in the United States Air Force, my stepfather in the United States Army and my brother in the United States Navy.

I think for every one of us who are here on this stage tonight, I think we all want to send our very best Happy Thanksgiving greetings to all of our men and women in uniform who are serving us overseas, here in the United States and also to their families. Happy Thanksgiving. We appreciate, we love you and we want to get you home as soon as we can. [applause]

HUNTSMAN: My name is Jon Huntsman. I believe this week, in particular, that there is still much to be grateful for in this, the greatest nation that ever was. I’m here with my wife of 28 years, Mary Kay, who is fortuitously sitting in the New Hampshire box up here. We are the wife — or we are the parents of seven kids, two in the United States Navy.

Twice elected governor of the great state of Utah, I’ve lived overseas four times, three times as a United States ambassador. I am honored and privileged to be here. Wolf, CNN, Heritage, AEI, thank you one and all for making tonight possible.

BLITZER: Thank you very much. And let’s get right to the questions.

[applause]

BLITZER: Our leadoff question is from the honorable Ed Meese, the former attorney general of the United States, who is representing the Heritage Foundation.

ED MEESE, HERITAGE FOUNDATION: At least 42 terrorist attacks aimed at the United States have been thwarted since 9/11. Tools like the Patriot Act have been instrumental in finding and stopping terrorists.

Shouldn’t we have a long range extension of the investigative powers contained in that act so that our law enforcement officers can have the tools that they need?

BLITZER: Speaker Gingrich, only this weekend there was an alleged terror plot uncovered in New York City. What do you think?

GINGRICH: Well, I think that Attorney General Meese has raised a key point, and the key distinction for the American people to recognize is the difference between national security requirements and criminal law requirements.

I think it’s desperately important that we preserve your right to be innocent until proven guilty, if it’s a matter of criminal law. But if you’re trying to find somebody who may have a nuclear weapon that they are trying to bring into an American city, I think you want to use every tool that you can possibly use to gather the intelligence.

The Patriot Act has clearly been a key part of that. And I think looking at it carefully and extending it and building an honest understanding that all of us will be in danger for the rest of our lives. This is not going to end in the short run. And we need to be prepared to protect ourselves from those who, if they could, would not just kill us individually, but would take out entire cities.

BLITZER: So, Speaker, just to clarify, you wouldn’t change the Patriot Act?

GINGRICH: No, I would not change it. I’m not aware of any specific change it needs. And I’d look at strengthening it, because I think the dangers are literally that great. And again, I’ve spent years studying this stuff. You start thinking about one nuclear weapon in one American city and the scale of loss of life and you ask yourself, what should the president be capable of doing to stop that?

And you come up with a very different answer. Again, very sharp division. Criminal law, the government should be frankly on defense and you’re innocent until proven guilty. National security, the government should have many more tools in order to save our lives.

BLITZER: Congressman Paul, I suspect you disagree.

PAUL: I do.

BLITZER: Tell us why.

PAUL: I think the Patriot Act is unpatriotic because it undermines our liberty. I’m concerned, as everybody is, about the terrorist attack. Timothy McVeigh was a vicious terrorist. He was arrested. Terrorism is still on the books, internationally and nationally, it’s a crime and we should deal with it.

We dealt with it rather well with Timothy McVeigh. But why I really fear it is we have drifted into a condition that we were warned against because our early founders were very clear. They said, don’t be willing to sacrifice liberty for security.

Today it seems too easy that our government and our congresses are so willing to give up our liberties for our security. I have a personal belief that you never have to give up liberty for security. You can still provide security without sacrificing our Bill of Rights. [applause]

BLITZER: I want to bring others in, but do you want to respond, Mr. Speaker?

GINGRICH: Yes. Timothy McVeigh succeeded. That’s the whole point.

[applause]

GINGRICH: Timothy McVeigh killed a lot of Americans. I don’t want a law that says after we lose a major American city, we’re sure going to come and find you. I want a law that says, you try to take out an American city, we’re going to stop you.

[applause]

PAUL: This is like saying that we need a policeman in every house, a camera in every house because we want to prevent child- beating and wife-beating. You can prevent crimes by becoming a police state. So if you advocate the police state, yes, you can have safety and security and you might prevent a crime, but the crime then will be against the American people and against our freedoms. And we will throw out so much of what our revolution was fought for. So don’t do it so carelessly. [applause]

BLITZER: Congresswoman Bachmann, let me bring you into this conversation. Are you with Congressman Paul or Speaker Gingrich or do you have your own view?

BACHMANN: Well, I’m with the American people, with the Constitution, and with the job of the commander-in-chief as the number one duty of the president of the United States.

We have to realize we’re in a very different war, with very different techniques that are used for that war, and very different bad actors than we’ve had before in the terrorists and their motivations are very different.

We can’t forget that technology is completely different. When we were looking at prior laws, phones were wired in to walls. That’s not how it works any more. Today we deal with wireless functions. And we have to completely change the way that we go about investigating.

This is one thing we know about Barack Obama. He has essentially handed over our interrogation of terrorists to the ACLU. He has outsourced it to them. Our CIA has no ability to have any form of interrogation for terrorists.

When the bomber — or the attempted bomber over Detroit, the underwear bomber was intercepted, he was given Miranda warnings within 45 minutes. He was not an American citizen. We don’t give Miranda warnings to terrorists, and we don’t read them their rights. They don’t have any. [applause]

BLITZER: Governor Huntsman, where do you stand on the Patriot Act? Do you believe it’s un-American, as Congressman Paul has suggested?

HUNTSMAN: I think we have to be very careful in protecting our individual liberties. We forget sometimes that we have a name brand in this world. And I have seen it shine living overseas. And when our light shines based on the values that we live up to and represent, it moves people, it moves countries, it moves events like nothing else can.

We are a nation of values. And forever, like what we’re trying to do in this debate tonight, we’ll try to find that balancing act between our individual liberties and security. But we also have to remember as we’re talking about security, I see Tom Ridge in the audience here, a great former secretary of Homeland Security. He will tell you, he will tell you that we cannot secure the homeland out of Washington, D.C., itself. We’ve got to make sure that we have partnerships with governors and mayors, that this is a national effort.

No longer can we compartmentalize intelligence. Those are the old days. Today we’ve got to share. We’ve got to make sure that we are prepared as a people, we are prepared not only as a federal government, but we’re prepared as well as a local government in a collaborative and sharing kind of relationship.

BLITZER: I’m going to give everyone a chance to respond, but let me get this one question from CNN Politics, that came to cnnpolitics.com, and then we’ll bring in the rest of you.

This was the question: “TSA pat-downs: violation of civil liberty or a necessity to ensure national security?”

Governor Romney?

ROMNEY: Well, we can do a lot better than the TSA system. It’s going to get get better over time. We can use better technology. We can also identify people who are lower risk and allow them to go through the process more quickly than the current process.

But let’s come back to the issue that seems to be so confusing here.

And that is Congressman Paul talked about crime. Newt Gingrich was right. There are different categories here. There’s crime and there are rights that are afforded to American citizens under our Constitution and those that are accused of crime. Then there’s war. And the tool of war being used today in America and around the world is terror. There’s a different body of law that relates to war.

And for those that understand the difference between the two, they recognize that we need tools when war is waged domestically to ensure that, as president of the United States, you can fulfill your first responsibility, which is to protect the life, liberty and property of American citizens and defend them from foes domestic and foreign.

And that means, yes, we’ll use the Constitution and criminal law for those people who commit crimes, but those who commit war and attack the United States and pursue treason of various kinds, we will use instead a very different form of law, which is the law afforded to those who are fighting America.

that we need tools when war is waged domestically to ensure that as president of the United States you can fulfill your first responsibility which is to protect the life, liberty and property of American citizens and defend them from foes domestic and foreign. That means yes we’ll use the constitution and criminal law for those people who commit crimes but those who commit war and attack the United States and pursue treason of various kinds we will use instead a very different form of law which is the law afforded to those who are fighting America.

BLITZER: Governor Perry…[applause]… you proposed legislation that would criminalize these TSA pat-downs under certain circumstances.

PERRY: Right.

BLITZER: Explain what you have in mind.

PERRY: Well, here’s what I would do with the TSA; I would privatize it as soon as I could and get rid of those unions. [applause]

It’s working in Denver. They have a program where they’re privatizing it. And the airlines and other private-sector groups work together to do the security in our airports. And it makes abundant good sense.

And I agree with most of my colleagues here on the stage when we talk about the Patriot Act. And we need to keep it in place. We need to have — strengthen it if that’s what’s required, to update it with new technologies as they come along, Newt.

But here’s the other issue that I think we’ve really failed at, and that is in our ability to collect intelligence around the world. And this administration in particular has been an absolute failure when it comes to expending the dollars and supporting the CIA and the military intelligence around the world, to be able to draw in that intelligence that is going to truly be able to allow us to keep the next terrorist attack from happening on American soil.

BLITZER: Senator Santorum, under certain circumstances in the past, you’ve supported profiling. Is that correct?

SANTORUM: I have.

BLITZER: What do you have in mind?

SANTORUM: Well, I mean, I think TSA is a good example of that. We should be trying to find the bomber, not the bomb. Other countries have done it. Israel is probably the best example of that.

But to put this enormous expense on the federal government, to put the enormous expense on the traveling public for — for pat-downs and other intrusions, I think, is too much money. I agree with Governor Perry; I actually voted when I — when this bill came up, I voted to allow for privatization. I was not for this being a government function. I thought it could be a private function.

But the issue of the Patriot Act is — is a little different. We are at war. The last time we had a — we had a threat at home like this — obviously, it was much more of a threat at home — was during the Civil War.

And, of course, Abraham Lincoln ran right over civil rights. Why? Because we had a present domestic threat. In the previous wars that we’ve had, we haven’t had this type of threat that we have here in the homeland. And we have to deal with it differently.

I disagree with Governor Huntsman. He made some good points. And we have had the debate. It’s been an open debate. It’s really shown the values of our country, that we can engage in this open debate and balance those interests, and I think we have done so appropriately.

BLITZER: So just to be precise, is it ethnic profiling, religious profiling? Who would be profiled?

SANTORUM: Well, the folks who are most likely to be committing these crimes. If you look at — I mean, obviously, it was — obviously, Muslims would be — would be someone you’d look at, absolutely. Those are the folks who are — the radical Muslims are the people that are committing these crimes, as we’ve — by and large, as well as younger males.

I mean, these are things that — not exclusively — but these are things that you profile to — to find your best — the most likely candidate.

BLITZER: Congressman Paul?

PAUL: That’s digging a… [applause] That’s digging a hole for ourselves. What if they look like Timothy McVeigh? You know, he was a pretty tough criminal.

I think we’re using too much carelessness in the use of words that we’re at war. I don’t remember voting on — on a declared — declaration of war. Oh, we’re against terrorism. [applause]

And terrorism is a tactic. It isn’t a person. It isn’t a people. So this is a very careless use of words. What about this? Sacrifice liberties because there are terrorists? You’re the judge and the jury? No, they’re suspects.

And they have changed the — in the — in DOD budget they have changed the wording on the definition of al-Qaeda and Taliban. It’s anybody associated with organizations, which means almost anybody can be loosely associated so that makes all Americans vulnerable.

And now we know that American citizens are vulnerable to assassination.

So I would be very cautious about protecting the rule of law. It will be a sacrifice that you’ll be sorry for. [applause]

BLITZER: Herman Cain, let’s bring you into this conversation. Are you with Senator Santorum when he says that there should be religious profiling, that Muslims in particular should get extra screening when they go — go through airports?

CAIN: I believe we can do a whole lot better with TSA. And I called it, targeted identification.

BLITZER: What does that mean?

CAIN: We can do — we can do — targeted identification. If you take a look at the people who are trying to kill us, it would be easy to figure out exactly what that identification profile looks like.

But I want — but I want to make sure that I get to the Patriot Act. So I believe we can do a whole better. The answer, I believe, also may be privatization.

Now, relative to the Patriot Act, if there are some areas of the Patriot Act that we need to refine, I’m all for that. But I do not believe we ought to throw out the baby with the bathwater for the following reason. The terrorists have one objective that some people don’t seem to get. They want to kill all of us.

So we should use every mean possible to kill them first or identify them first — first. [applause]

BLITZER: Now, just to be precise, Mr. Cain. I just want to — I’ll give you a chance. Is it OK for Muslim Americans to get more intensive pat downs or security when they go through airports than Christian Americans or Jewish Americans?

CAIN: No, Blitz. That’s oversimplifying it. I happen to believe that if — if you allow our intelligence agencies to do their job they can come up with an approach — I’m sorry, Blitz, I meant Wolf, OK? [laughter] [applause]

This was — since we on a — since we on a blitz debate, I apologize. Wolf, what I’m saying is let’s ask the professionals to give us an approach of how we can increase the identification of people that might be a danger to civilians as well as a danger to this nation.

BLITZER: Thank you, Cain. [laughter] [applause] All right. Go ahead. We have another question. Please give us your name and the organization you represent.

QUESTION: I’m Fred Kagan, resident scholar and director of the Critical Threats Project at the American Enterprise Institute.

And my question is, the raid that killed Osama bin Laden was obviously an important success in the struggle against al-Qaeda, although it also drove U.S. relations with Pakistan into a new low.

Do you think that an expanded drone campaign in Pakistan would be sufficient to defeat al-Qaeda and to secure our interests in Pakistan?

BLITZER: Governor Huntsman?

HUNTSMAN: Let me just say that as we talk about foreign policy, let’s be reminded that in order to have an effective foreign policy we need a Washington that works.

Today we have a president who can’t lead. We have a Congress that can’t even figure out how to balance our budget. They need term limits, by the way. We’ve gotta get our house in order if we… [applause] Thank you. We’ve gotta get our house in order if we’re gonna expect to get anything done overseas because when our light shines we can influence the rest of the world.

Pakistan is a concern. That’s the country that ought to keep everybody up at night. You have not President Zardari in charge but General Kayani over the military, which also is responsible for ISI.

You’ve got the youngest demographic of the 160 million people in Pakistan. You’ve got a Midrasha movement. You’ve got over 100 nuclear weapons. You’ve got trouble on the border.

You’ve got a nation-state that is a candidate for failure. And I say it’s a haven for bad behavior. It’s a haven — it’s — it’s a haven for training the people who seek to do us harm. And an expanded drone program is something that would serve our national interest.

I think it must be done. And I think it must be consistent with recognizing the reality on the ground of what we need out of Afghanistan — we don’t need 100,000 troops in Afghanistan.

We don’t need to nation-build in Afghanistan when this nation so desperately needs to be built.

BLITZER: We’re gonna get to Afghanistan.

HUNTSMAN: But we need something. We need something in Afghanistan.

BLITZER: Congresswoman Bachmann, we’ll be bringing you in. You’re a member…

HUNTSMAN: We need Special Forces and drones.

BLITZER: All right. You’re a member of the Intelligence Committee. Do you think, as Governor Perry has said, that Pakistan should no longer receive U.S. aid because they’ve shown they’re not a good friend, ally of the United States?

BACHMANN: Pakistan has been the epicenter of dealing with terrorism. They are, as Governor Huntsman said, there are al-Qaeda training grounds there. There’s also the Haqqani network that can be trained there as well.

And they also are one of the most violent, unstable nations that there is. We have to recognize that 15 of the sites, nuclear sites are available or are potentially penetrable by jihadists. Six attempts have already been made on nuclear sites. This is more than an existential threat. We have to take this very seriously.

The United States has to be engaged. It is complicated. We have to recognize that the Chinese are doing everything that they can to be an influential party in Pakistan. We don’t want to lose influence.

I’m answering your question. You asked me about the money that the United States gives to Pakistan. This is a — this is a dual answer. A nation that lies, that does everything possibly that you could imagine wrong, at the same time they do share intelligence data with us regarding Al Qaida.

We need to demand more. The money that we are sending right now is primarily intelligence money to Pakistan. It is helping the United States. Whatever our action is, it must ultimately be about helping the United States and our sovereignty…

BLITZER: So…

BACHMANN: … our safety and our security.

BLITZER: … you would continue that aid to Pakistan?

BACHMANN: I — at this point I would continue that aid, but I do think that the Obama policy of keeping your fingers crossed is not working in Pakistan,. And I also think that Pakistan is a nation, that it’s kind of like too nuclear to fail. And so we’ve got to make sure that we take that threat very seriously.

BLITZER: Governor Perry?

PERRY: I understand where she’s coming from, but the bottom line is that they’ve showed us time after time that they can’t be trusted. And until Pakistan clearly shows that they have America’s best interests in mind, I would not send them one penny, period.

I think it is important for us to send the message to those across the world that, if you are not going to be an ally of the United States, do not expect a dime of our citizens’ money to be coming into your country. That is the way we change foreign policy. Now, if we want to engage these countries with our abilities and our companies that go in, and help to economically build these countries up, rather than just writing a blank check to them, then we can have that conversation, because I think that is a change in foreign policy that would be adequate and appropriate and a positive move for us.

But to write a check to countries that are clearly not representing American interests is nonsensical.

BLITZER: You want to respond, Congresswoman Bachmann?

BACHMANN: Well, I — with all due respect to the governor, I think that’s highly naive, because, again, we have to recognize what’s happening on the ground. These are nuclear weapons all across this nation. And, potentially, Al Qaida could get hold of these weapons.

These weapons could find their way out of — out of Pakistan, into New York City or into Washington, D.C., and a nuclear weapon could be set off in this city. That’s how serious this is. We have to maintain an American presence.

They certainly aren’t looking out for the best interests of the United States. I wouldn’t expect them to. But at the same time, we have to have our interests, which is national security, represented. The best way we can do that with an uneven actor state is to have some sort of presence there.

BLITZER: I just want to give Governor Perry the chance to respond.

She just said your views are highly naive.

PERRY: And I — absolutely we need to be engaged in that part of the world. I never said for us not to be engaged. I just said we need to quit writing blank checks to these countries, and then letting them decide how these dollars are going to be spent.

We’ve got Afghanistan and India working in concert right now to leverage Pakistan. I think if we would create a trade zone in that part of the world, where you have all of those countries working together, that may be the answer to getting Pakistan to understand that they have to work with all of the countries in that region.

BLITZER: All right, I want to move on.

[crosstalk]

BLITZER: I want to move on, but you’ll have a chance — you’ll have a chance to respond…

BACHMANN: If I can just — Wolf, if I could just…

BLITZER: Very quickly.

BACHMANN: … clarify, we’re not writing just blank checks. We’re also exchanging intelligence information. So we aren’t writing blank checks in that region.

BLITZER: All right. Let’s take another question from the audience.

Please give us your name and your organization.

QUESTION: Israel Ortega with the Heritage Foundation.

Is the money that we’ve drawn back from U.S. troops in Afghanistan really worth the risk of allowing Taliban to expand territories, and Al Qaida to grow safe sanctuaries?

BLITZER: Governor Romney, $2 billion a week the United States is spending right now in Afghanistan, $2 billion, more than $100 billion a year. And U.S. troops are supposed to stay for another three years at least, till the end of 2014. Is that money well spent?

ROMNEY: We spent about $450 billion so far, 1,700 or so service men and women have lost their lives there, and many tens of thousands have been wounded. Our effort there is to keep Afghanistan from becoming a launching point for terror against the United States. We can’t just write off a major part of the world.

Pakistan is the sixth largest country in the world. We can’t just say goodbye to all of — of what’s going on in that part of the world.

Instead, we want to draw them toward modernity. And for that to happen, we don’t want to literally pull up stakes and run out of town after the extraordinary investment that we’ve made. And that means we should have a gradual transition of handing off to the Afghan security forces the responsibility for their own country.

And for the region, what happened in Indonesia back in the 1960s, where — where we helped Indonesia move toward modernity with new leadership. We — we brought them in the technology that allowed them to trade in the world.

We need to bring Pakistan into the 21st century — or the 20th century, for that matter, so that they — they can engage throughout the world with trade and with modernity.

Right now, American approval level in — in Pakistan is 12 percent. We’re not doing a very good job with this huge investment we make of $4.5 billion a year. We can do a lot better directing that to encourage people to take advantage of the extraordinary opportunities the West and freedom represent for their people.

BLITZER: Now, Governor Huntsman, do you agree with Governor Romney that the U.S. has to stay in Afghanistan at these levels?

HUNTSMAN: No, I — I totally disagree. I think we need to square with the American people about what we’ve achieved. We need an honest conversation in this country about the sacrifices that have been made over nearly 10 years. We have — we have dismantled the Taliban. We’ve run them out of Kabul. We’ve had free elections in 2004. We’ve killed Osama bin Laden. We’ve upended, dismantled al Qaeda. We have achieved some very important goals for the United States of America.

Now, the fact that we have 100,000 troops nation-building in Afghanistan when this nation so desperately needs to be built, when, on the ground, we do need intelligence gathering, no doubt about that. We need a strong Special Forces presence. We need a drone presence. And we need some ongoing training of the Afghan National Army.

But we haven’t done a very good job defining and articulating what the end point is in Afghanistan. And I think the American people are getting very tired about where we find ourselves today. [applause]

BLITZER: Let me let Governor Romney respond.

ROMNEY: Well, let me respond.

Are you suggesting, Governor, that we just take all our troops out next week or what — what’s your proposal?

HUNTSMAN: Did you hear what I just said?

I said we should draw down from 100,000. We don’t need 100,000 troops. We don’t need 100,000 troops in Afghanistan… [crosstalk] …many of whom can’t even cross the wire. We need a presence on the ground that is more akin to 10,000 or 15,000. That will serve our interests in terms of intelligence gathering and Special Forces response capability. And we need to prepare for a world, not just in South Asia, but, indeed, in every corner of the world in which counter-terror — counter-terrorism is going to be in front of us for as far as the eye can see into the 21st century.

ROMNEY: And the — and the commanders on the ground feel that we should bring down our surge troops by December of 2012 and bring down all of our troops, other than, perhaps, 10,000 or so, by the end of — of 2014.

The decision to pull our troops out before that, they believe, would put at risk the extraordinary investment of treasure and blood which has been sacrificed by the American military.

I stand with the commanders in this regard and have no information that suggests that pulling our troops out faster than that would do anything but put at — at great peril the extraordinary sacrifice that’s been made. This is not time for America to cut and run. We have been in for 10 years. We are winding down. The Afghan troops are picking up the capacity to secure their country. And the mission is pretty straightforward, and that is to allow the Afghan people to have a sovereign nation not taken over by the Taliban.

BLITZER: Let me bring the speaker in. What do you say…

GINGRICH: I would…

BLITZER: — pull out?

HUNTSMAN: Just — just one point.

BLITZER: You want — oh, go ahead.

HUNTSMAN: Yes, just about the generals on the ground. And listen, I think it’s important for the American people to know we have achieved some very important objectives in raising standards in Afghanistan and helping to build civil society.

But at the end of the day, the president of the United States is commander-in-chief, commander-in-chief. Of course you’re going to listen to the generals. But…[applause]…I also remember when people listened to the generals in 1967 and we heard a certain course of action in South Asia that didn’t serve our interests very well.

The president is the commander-in-chief and ought to be informed by a lot of different voices, including of those of his generals on the ground.

BLITZER: Speaker Gingrich? [applause]

GINGRICH: It’s…

ROMNEY: Look, I’ve got a good — he gets a response, I get a response.

BLITZER: All right.

ROMNEY: Of course the commander-in-chief makes — make the final decision.

PAUL: How about the rest of us?

ROMNEY: Of course the final — look…

PAUL: How about us who haven’t had a response?

BLITZER: [inaudible] got a chance.

ROMNEY: Of course the commander-in-chiefs makes the — makes the final decision. But the commander-in-chief makes that decision based upon the input of people closest to the ground. And — and we — we’ve both been to Afghanistan. I’ve been to Afghanistan. The people I speak with there say we have a very good prospect of the people in Afghanistan being able to secure the peace and their sovereignty from the Taliban, but that if we pull out on a precipitous basis, as Governor Huntsman suggests, that we could well see that nation and Pakistan get pulled into terror and become another launching point to go after America. That’s a mistake. That’s why you listen and then make your decision.

BLITZER: Speaker? [applause]

GINGRICH: Well, Wolf, I’m a little confused about exactly what we’re currently debating, because I think — I think we tend to get down to these narrow questions that — that, in a sense, don’t get at the — at the core issues.

The very first question I thought about Pakistan is the one that should be the starting point.

The gentleman said that when we went in and killed bin Laden, that we drove U.S.-Pakistan — did I have — is this like a 30-second response?

BLITZER: Go ahead.

GINGRICH: I mean, I’m happy to play by the rules, I just want to know what they are. But I think this is the heart of the American dilemma. We were told, a perfectly natural Washington assumption that our killing bin Laden in Pakistan drove U.S.-Pakistan relations to a new low.

To which my answer is, well, it should have because we should be furious. [applause]

GINGRICH: Now, and that’s where this has got to start. You want to keep American troops in Afghanistan, you accept hot pursuit, you say no sanctuaries, you change the rules of engagement, you put the military in charge of the military side, you overhaul the State Department and AID so they get the job done, and you do it for real and you do it intensely, and you tell the Pakistanis, help us or get out of the way, but don’t complain if we kill people you’re not willing to go after on your territory where you have been protecting them. [applause]

BLITZER: Senator Santorum?

SANTORUM: I agree with Ron Paul. We are not fighting a war on terrorism. Terrorism is a tactic. We’re fighting a war against radical Islam. And what radical Islam is telling — all of the radical Islamist leaders are saying is that just wait America out, America is weak, they will not stand for the fight, they cannot maintain this, they’ll set time limits, politics will interfere, and we will tell the people in Afghanistan, we will tell the people in Iraq and other places that we will be the strong horse in the region.

And President Obama, by making political decision after political decision about timelines and constraints on rules of engagement, has validated everything these radical Islamists are saying.

So the answer to you, Jon, is that you’re doing exactly — Governor Huntsman, is that you’re doing exactly what all of the radical leaders are saying that America will do, that we are not in this to win, we are going to play politics with this, and then we will find this problem in Afghanistan on our shores in a very short order.

BLITZER: We are going to come to Congressman Cain [sic] in a moment. But just hold your horses for a second because we’re going to take a quick break. Much more coming up. The former chairman of the U.S. Joint Chiefs of Staff calls this the number one threat to America’s national security. The candidates will answer that question on this topic, coming up next.

We want you to send us your questions for the candidates. Go to cnnpolitics.com or facebook.com/cnnpolitics or on twitter use #cnndebate. Our coverage of this historic debate at Constitution Hall in Washington continues in a moment.

[commercial break]

BLITZER: Welcome back to historic Constitution Hall here in the nation’s capital. [applause]

We’re continuing the CNN national security debate. Let’s go right to the audience. We have a question from the audience. [applause]

Go ahead with your question.

Hello?

No question from the audience.

Yes, we do. We do have a question from the audience. [laughter]

We were waiting for you. [laughter]

QUESTION: I’m Mike Gonzalez of the Heritage Foundation.

BLITZER: Thank you.

QUESTION: If Israel attacked Iran to prevent Tehran from getting nuclear weapons, would you help Israel launch the attack or support it otherwise?

BLITZER: All right. We’ve got the question. Let me ask Herman Cain first. Did you get the question?

CAIN: I didn’t quite get the question.

BLITZER: If — the specific question is, if Israel attacked Iran to prevent Tehran from getting nuclear weapons, would you help Israel launch the attack or support it otherwise?

CAIN: I would first make sure that they had a credible plan for success, clarity of mission and clarity of success.

Remember, when you talk about attacking Iran, it is a very mountainous region. The latest reports say that there may be 40 different locations, and I would want to make sure that we had a good idea from intelligence sources where these are located.

And if Israel had a credible plan that it appeared as if they could succeed, I would support Israel, yes. And in some instances, depending upon how strong the plan is, we would join with Israel for that, if it was clear what the mission was and it was clear what the definition of victory was. [applause]

BLITZER: Congressman Paul, would you support Israel and help Israel in such an attack?

PAUL: No, I wouldn’t do that. [laughter]

But there would be good reasons because I don’t expect it to happen. Because, you know, the Mossad leader that just retired said it would be the stupidest thing to do in the world. And it’s a big argument over in Israel. They’re not about to do this.

They’ve just polled 40 major experts on foreign policy here by the National Journal. Not one of them said there should be a unilateral attack on — on the sites in — in Iran.

So that’s not going to happen. And if it did — you’re supposing that if it did, why does Israel need our help? We need to get out of their way. I mean, we interfere with them. We interfere with them…[laughter]… when they deal with their borders. When they want to have peace treaties, we tell them what they can do because we buy their allegiance and they sacrifice their sovereignty to us. And then they decide they want to bomb something, that’s their business, but they should, you know, suffer the consequences. When they bombed the Iraqi missile site, nuclear site, back in the ’80s, I was one of the few in Congress that said it’s none of our business and Israel should take care of themselves. Israel has 200, 300 nuclear missiles. And they can take care of themselves. Why should we commit — we don’t even have a treaty with Israel. Why do we have this automatic commitment that we’re going to send our kids and send our money endlessly to Israel? So I think they’re quite capable of taking care of themselves.

I think we do detriment — just think of all the money we gave to Egypt over 30 or 40 years. Now, look, we were buying friendship. Now there’s a civil war, they’re less friendly to Israel.

The whole thing is going to backfire once we go bankrupt and we remove our troops, so I think we should be very cautious in our willingness to go to war and send troops without a proper declaration by the U.S. Congress.

BLITZER: Let me let Herman Cain respond. [applause]

CAIN: Thank you.

I stated if the mission and the plan were clear, that it could succeed, but I pointed out that that is highly unlikely, given the terrain, the mountainous terrain in Iran.

But here’s the other reason that we should help Israel in an initiative live that. Back to Afghanistan: if we pull out of Afghanistan too soon, Iran is going to help to fulfill that power vacuum in Afghanistan. And so it is in our best interests, the United States of America, to prevent them from being able to help fill that power vacuum in Afghanistan.

BLITZER: Let’s stay on this subject. And I want all of you to weigh in. We have another question.

Please give us your name and your organization.

QUESTION: Good evening. I’m Danielle Pletka; I’m the Vice President for Foreign and Defense Policy Studies at the American Enterprise Institute. Yesterday the United States and the U.K. slapped new sanctions on Iran. But we haven’t bought oil directly from Iran in over 30 years. We’ve had targeted sanctions on Iran for more than half that time.

Nonetheless, Iran is probably less than a year away from getting a nuclear weapon. Do you believe that there is any set of sanctions that could be put in place that would stop Iran from getting a nuclear weapon?

BLITZER: Let’s go to Governor Perry. What do you think?

PERRY: Absolutely. We need to sanction the Iranian Central Bank. That would be one of the most powerful ways to impact that. As a matter of fact, Congressman Paul, that is what we need to do before we ever start having any conversations about a military strike, is to use every sanction that we have. And when you sanction the Iranian Central Bank, that will shut down that economy. At that particular point in time, they truly have to deal with the United States. And it’s one of the reasons that I call for the — there is an area over there, of all of them working together — and I’m talking about Syria — and bringing them into the mix as well.

As I called for, one of the options is to have a no-fly zone over Syria at the same time you’re putting those types of sanctions against Iran. And in that moment, they will understand that America is serious. This President refuses to do that, and it’s another show of lack of leadership from the President of the United States.

BLITZER: The argument, Speaker Gingrich — and I know you’ve studied this, and I want you to weigh in — on the sanctioning of the Iranian Central Bank, because if you do that, for all practical purposes, it cuts off Iranian oil exports, 4 million barrels a day.

The Europeans get a lot of that oil. They think their economy, if the price of gasoline skyrocketed, which it would, would be disastrous. That’s why the pressure is on the U.S. to not impose those sanctions. What say you?

GINGRICH: Well, I say you — the question you just asked is perfect, because the fact is we ought to have a massive all-sources energy program in the United States designed to, once again, create a surplus of energy here, so we could say to the Europeans pretty cheerfully, that all the various sources of oil we have in the United States, we could literally replace the Iranian oil.

Now that’s how we won World War II. [applause]

GINGRICH: So, I think you put your finger, Wolf, on the — on the — you know, we all get sucked into these tactical discussions. We need a strategy of defeating and replacing the current Iranian regime with minimum use of force. We need a strategy, as Rick Santorum was saying, of being honest about radical Islam and designing a strategy to defeat it wherever it happens to exist.

We need a strategy in central Asia that recognizes that, frankly, if you’re Pashtun, you don’t care whether you’re in Pakistan or Afghanistan, because you have the same tribal relationships. So we need to be much more strategic and less tactical in our discussion.

But if we were serious, we could break the Iranian regime, I think, within a year, starting candidly with cutting off the gasoline supply to Iran, and then, frankly, sabotaging the only refinery they have.

BLITZER: But sanctions on the Iranian Central Bank now, is that a good idea or a bad idea?

GINGRICH: I think it’s a good idea if you’re serious about stopping them having nuclear — I mean, I think replacing the regime before they get a nuclear weapon without a war beats replacing the regime with war, which beats allowing them to have a nuclear weapon. Those are your three choices.

BLITZER: I want Congresswoman Bachmann to weigh in. Go ahead. [applause]

BACHMANN: I agree with all of that. And energy independence is something that President Obama certainly has avoided.

BLITZER: But that’s going to take many years.

BACHMANN: It — it will but the president — almost every decision that the president has made since he came in has been one to put the United States in a position of unilateral disarmament including the most recent decision he made to cancel the Keystone Pipeline.

That would have not only created jobs but it would have helped us in energy independence.

But I want to go back to something. That’s the fact why is it that we’re talking about Israel having to make a strike against Iran? It’s because Iran has announced they plan to strike Israel.

They’ve stated, as recently as August just before President Ahmadinejad came to — to the U.N. General Assembly. He said that he wanted to eradicate Israel from the face of the earth.

He has said that if he has a nuclear weapon he will use it to wipe Israel off the face of the earth. He will use it against the United States of America.

This isn’t just an idle threat. This is a reality. And that’s why President Obama has — has failed the American people because for two and a half years he gave the Iran the luxury of time.

He met with them with no preconditions. It’s the doctrine of appeasement. He has changed the course of history because at the time when we needed a leader most, we didn’t have one.

That’s what I’ll do differently as President of the United States. I’ll lead. [applause]

BLITZER: Thank you. All right. I — I — I want to — I want to — we’re gonna continue this but we have another question from Paul Wolfowitz. Go ahead.

QUESTION: My name is Paul Wolfowitz. I’m a visiting scholar at the American Enterprise Institute and my question is about development assistance.

Under George W. Bush, who was a conservative Republican, the United States spent billions of dollars to fight AIDS and malaria in Africa and elsewhere and set up the Millennium Challenge Corporation to encourage governments of poor countries to pursue policies that promote economic growth and job creation.

Do you believe those are still wise expenditures? Or do you think we can no longer afford them?

BLITZER: Senator Santorum?

SANTORUM: Well, as the author of the Global Fund Bill and the Millennium Challenge in the United States Senate and someone who worked with the president on PEPFAR to deal with the issue of AIDS in Africa, I believe it’s absolutely essential.

Africa was a country on the brink. On the brink of complete meltdown and chaos, which would have been fertile ground for the radical Islamists to be able to — to get — to get a foothold.

We’re seeing it already. But the work that we’ve done in stabilizing that area, while humanitarian in nature, was absolutely essential for our national security.

And I hear people up here talking abut zeroing out foreign aid and humanitarian aid in particular. I think that’s absolutely the wrong course.

You want to — you want to spend more money on the military, zero out all the things we do to develop relationships around the world and we will spend a lot more money on the military.

It’s important for us to use all the assets we have. Promote our values. America is that shining city on the hill. It is — it is the city that comes to the aid of those in trouble in America — in the world.

We have done more good for America in Africa and in the third world by the things that we’ve done. And we have saved money and saved military deployments by wisely spending that money not on our enemies but on folks who can and will be our friends. [applause]

BLITZER: Herman Cain?

CAIN: Here again…

BLITZER: All right, here’s the question. Can the United States afford to continue that kind of foreign assistance to Africa for AIDS, malaria — could run into the billions of dollars? CAIN: It depends upon priorities. Secondly, it depends upon looking at the program and asking the question, has that aid been successful.

In other words, let’s look at the whole problem. It may be worthwhile to continue. It may not. I would like to see the results.

Just like every program we have here domestically, what have the results been. Then we make a decision about how we prioritize.

Ron Paul?

PAUL: I — I think the aid is all worthless. It doesn’t do any good for most of the people. You take money from poor people in this country and you end up giving it to rich people in poor countries.

And they’re used as weapons of war so you accomplish nothing. We should export some, maybe some principles about free markets and sound money and maybe they could produce some of their — their own wealth.

But this whole idea of — of talking about the endless wars and the endless foreign aid, it seems like nobody cares about the budget. I mean, we — we’re in big trouble and — and — and nobody wants to cut anything.

So if you’re gonna keep sending foreign aid overseas and these endless wars that you don’t have to declare and — and go into Libya without even consulting with the Congress, the biggest threat — the biggest threat to our national security is our financial condition.

And this is just aggravating it. [applause]

BLITZER: Governor Romney?

ROMNEY: Congressman Paul, what they’re doing is cutting a trillion dollars out of the defense budget. They’re cutting a trillion dollars out of the defense budget, which just happens to equal the trillion dollars we’re putting into “Obama-care.”

And so what you have is a president that has a priority of spending us into bankruptcy, but he’s not just spending us into bankruptcy, he’s spending the money foolishly.

We need to protect America and protect our troops and our military and stop the idea of “Obama-care.” That’s the best way to save money, not the military. [applause]

BLITZER: Hold on one second because Ron Paul wants to respond to that point.

PAUL: Well, they’re not cutting anything out of anything. All this talk is just talk. [applause]

Believe me. They’re cutting — they’re nibbling away at baseline budgeting, and its automatic increases. There’s nothing cut against the military. And the people on the Hill are nearly hysterical because they’re not going — the budget isn’t going up as rapidly as they want it to. It’s a road to disaster. We had better wake up. [applause]

ROMNEY: OK. Let’s just talk about what they’re cutting with the first $350 billion, not the next 600 which is coming down the road. The first $350 billion, what do they cut? They stopped the F-22. They delayed aircraft carriers. They stopped the Navy cruiser system. They said long range Air Force bombers aren’t going to be built. They’re trying to cut our troops by 50,000. The list goes on.

They’re cutting programs that are cutting the capacity of America to defend itself. Look, let’s stand back for a moment, because we’ve been talking about Israel and Iran. What we’re talking about here is a failure on the part of the president to lead with strength.

And that’s why we have discussions about whether Israel should have to step in to stop the nuclear program, whether Iran is going to become nuclear. We have a president who pursued an agenda of saying we’re going to be friendly to our foes and we’re going to be disrespectful to our friends.

The right course in America is to stand up to Iran with crippling sanctions, indict Ahmadinejad for violating the Geneva — or the Genocide Convention, put in place the kind of crippling sanctions that stop their economy. I know it’s going to make gasoline more expensive. There’s no price which is worth an Iranian nuclear weapon.

And the right course for Israel is to show that we care about Israel, that they are our friend, we’ll stick with them. If I’m president of the United States, my first trip — my first foreign trip will be to Israel to show the world we care about that country and that region. [applause]

BLITZER: All right. We’re going to stay on this subject.

Go ahead.

ALISON ACOSTA FRASER, FORMER DEPUTY DIRECTOR, OKLAHOMA OFFICE OF STATE FINANCE: Hi, my name is Alison Acosta Fraser, and I’m the director of the Roe Institute for Economic Policy Studies at the Heritage Foundation. And my question is this, the next president will have to make some very, very tough choices in order to solve the nation’s spending and debt crisis. Would you be willing to say that our national security is so paramount that cuts to the defense budget are unacceptable?

BLITZER: Speaker Gingrich.

GINGRICH: No. I helped found the Military Reform Caucus in 1981 at the beginning of the Reagan buildup because it’s clear that there are some things you can do in defense that are less expensive.

It’s clear, if it takes 15 to 20 years to build a weapons system at a time when Apple changes technology every nine months, there’s something profoundly wrong with this system. So I’m not going to tell you automatically I’m going to say yes. [applause]

GINGRICH: But let me make a deeper point. There’s a core thing that’s wrong with this whole city. You said earlier that it would take too long to open up American oil. We defeated Nazi Germany, fascist Italy, and Imperial Japan in three years and eight months because we thought we were serious.

If we were serious, we would open up enough oil fields in the next year that the price of oil worldwide would collapse. Now, that’s what we would do if we were a serious country. If we were serious… [applause]

One last thing, if we were serious, we would apply Strong America Now’s model of Lean Six Sigma, we would save $500 billion a year by having an efficient effective federal government. We would open up federal lands, increasing dramatically both jobs and the amount of revenue of the federal government.

There are lots of things you can do if you decide break out of the current mindless bureaucracy of this city and just get the job done, including, by the way, making the Millennium Challenge work and doing it in a way that we actually help people even more effectively and at a much lower cost by having public/private partnerships.

BLITZER: I’m going to bring Governor Huntsman in, but very quickly, Mr. Speaker, would you, if you were president of the United States, bomb Iran’s nuclear facilities to prevent it from becoming a nuclear power?

GINGRICH: Only as a last recourse and only as a step towards replacing the regime. No bombing campaign which leaves the regime in charge is going to accomplish very much in the long run. You have to seriously talk about regime replacement, not just attacking them.

But I will also say — this is, I guess, where I disagree with my good friend Ron Paul. If my choice was to collaborate with the Israelis on a conventional campaign or force them to use their nuclear weapons, it will be an extraordinarily dangerous world if out of a sense of being abandoned they went nuclear and used multiple nuclear weapons in Iran. That would be a future none of us would want to live through. [applause]

BLITZER: Governor Huntsman, where do you stand on defense cuts?

HUNTSMAN: Well, let’s face the economic reality. Let’s face the deficit reality we have as a country. We have an economic deficit. And I’d argue that 70 percent debt-to-GDP is a national security problem because, at some point, you just don’t grow any more, when your debt becomes that.

I mean, look at Japan. They’re in their third decade of lost growth. Look at Greece. Look at Italy. So I’d say, aside from that, we’ve got another deficit in this country. It’s called the trust deficit.

People have lost trust in their institutions of power in America. They don’t trust Congress. They don’t trust the executive branch. They don’t trust Wall Street. The list goes on. We’ve got to fix both those deficits.

As it relates to defense spending, let’s be realistic about this. We can’t have an intellectually honest conversation about where we go with debt and spending with sacred cows. Everything’s got to be on the table. The Defense Department’s got to be on the table, for haven’t sake. But we need to have a Defense Department and a budget for the Defense Department. If we can’t find some savings in the $650 billion budget, we’re not looking closely enough.

But we need spending for the Department of Defense that follows a strategy. And that strategy needs to follow how we best protect the American people now that we’re in the second decade of the 21st century.

And I believe our national security strategy and our foreign policy increasingly needs to follow, number one, economic policy.

It used to break my heart sitting in Beijing, the second largest embassy in the world, looking at neighboring Afghanistan. We’d have 100,000 troops there. The Chinese would move in and take the mining concession. And I’d say there’s something fundamentally wrong with this picture.

When are we going to get with the program and determine that foreign policy will be driven by economics, that which plays right back to strengthening our core…[applause]… and creates jobs here on the home front.

And, second of all, let’s face the reality that we have a counterterror threat for as far as the eye can see.

Professor Wolfowitz was just up here. I know he’s done a lot of work on — for as far as the eye can see, and that means not only in Afghanistan but every corner of the world. We’ve got to prepare for the reality that counterterrorism is here to stay. We need friends and allies who are in this fight with us. We need special forces response capability. We need defense spending that will match the realities of where we find ourselves.

BLITZER: Thank you very much. [applause]

Let me bring in Governor Perry into this conversation.

As you know, the so-called supercommittee failed. And as a result, unless Congress takes action next year — in an election year, that would be difficult — there’s not going to be any change in that automatic trigger as it’s called. That sequestration, $1.2 trillion cut, including $600 billion in defense, will go into effect.

Here’s the question. If you were president of the United States, would you compromise with Democrats in Congress in order to avoid that Washington gridlock that, if you believe the polls, the American people hate?

PERRY: I don’t think anybody is particularly surprised that a supercommittee failed. It was a super-failure. And I think we expected that. We had a president of the United States who is not a leader. He pitched this over to them and said, here, you all figure this out.

I’ve signed six balanced budgets as the head of the state of Texas. I worked with those legislators on a daily basis, or my staff.

This president has been an absolute failure when it came to this budget process. And the idea — it was almost reprehensible to me. I’ve worn the uniform of this country. I’ve been the commander in chief of the 20-plus-thousand National Guard troops that we have in Texas, Dr. Paul.

But it was reprehensible, for me, for this president to stand in front of Americans and to say that that half a trillion dollars, $500 million-plus is not going to be on the table and we’re just going to have to work our way through it, putting young men and women’s life in jeopardy.

And I will tell you, as a commander in chief, as an American citizen, that is totally and absolutely irresponsible. Even his own secretary of defense said it was irresponsible. As a matter of fact, if Leon Panetta is an honorable man, he should resign in protest.

BLITZER: Here’s the question, though. Would you compromise — all of you have said you wouldn’t accept any tax increases at all, even if there were 10 — 10 times as many spending cuts. So would you just let the gridlock continue, Governor Perry, or would you compromise under those circumstances?

PERRY: Listen, I’ve had to work with Democrats for the 10 years that I’ve been the governor of the state of Texas.

So the idea that you can’t sit down and work with people on both sides of the aisle, but just to, you know, throw us into — into that briar patch at this particular point in time and say, what would you do — we would never have gotten into that situation if I were the president of the United States. I’d have been there working day in and day out so that we had a budget that not only — I’ve laid out a clear plan to — flat tax of 20 percent; cut the spending; and put a 20 percent corporate tax rate in. And, as a matter of fact, they ought to make the legislature, the Congress, part-time, and that would make as big an impact in this city as anything I can think of.

BLITZER: Let me bring Senator Santorum into this, because I covered Ronald Reagan’s presidency. And, as you know — and I’ll read a quote. He wrote in his autobiography this: “If you got 75 of 80 percent of what you were asking for, I say you take it and fight for the rest later.”

If you got 75 percent or 80 percent of what you wanted, would you make a deal with Democrats, increase some taxes in order to move on and fight the next battle the next day?

SANTORUM: It all depends on what the 75 percent and 85 percent is. If the — if the things that you have to give up make what you’re trying to accomplish harder to do — in other words, reduce the deficit, what the Republicans — why the Republicans are drawing a line in the sand, rightfully so, it’s because what they’re — what the Democrats are attempting to do is increase taxes, which will slow down to the — this economy, which will increase the deficit, reduce tax revenues, ultimately, and — and increase government payments.

So you don’t work against yourself. You — you won’t — you — you take ideas from the other side that you may not find particularly valuable, like spending cuts that you may not want. There are spending cuts that I would like to, you know, I mean there’s things that it mentioned before, that I would stand — stand firm on.

But in a compromise, yes, you do give up some things that you think maybe are critical spending. But you don’t undermine the ability of this con — economy to grow because of politics. This president has poisoned the well. He’s campaigned all over this country, trying to divide group from group in order to — to — to win, you know, to — to position himself to win this election and rally his troops. And what he’s done is poisoned the well here in Congress.

I’ve worked together, I’ve got a long track record of bipartisan accomplishments where I kept to the principles. I use welfare reform as an example. Welfare reform, I stuck to my principles. We cut the welfare budget. We had — we had time limits. We block granted to the states and we put a work requirement.

Did I compromise on things?

Yes. I compromised on some — on some child care. I compromised on — on some transportation.

So I got 75 percent. But it 100 percent changed the welfare system because we…

BLITZER: Thank you.

SANTORUM: — stuck to our principles.

BLITZER: Let — but let’s stay on this subject, because I know many of you want to weigh in. [applause]

We have another question.

ALEX BRILL: My name is Alex Brill and I’m a research fellow in the economics department at the American Enterprise Institute. Even if the super committee hadn’t failed, the savings that they would have proposed would have been a drop in the bucket relative to the $11 trillion deficit our country may face in the subsequent decade. In the decades after that, without entitlement reform, we’ll borrow even more.

To strengthen our economy, to strengthen our country, what entitlement reform proposals would you make to address our long-term structural deficit?

BLITZER: Good question.

Speaker Gingrich?

GINGRICH: It’s a great question and it raises the — the core issue of really large scale change.

Yesterday in Manchester, I outlined a Social Security reform plan based on Chile and based on Galveston, Texas. In Chile, people who have now have the right to a personal Social Security savings account, for 30 years, the government of Chile has promised that if you don’t have as much savings as you would get from Social Security, the government would make up the difference.

In 30 years time, they’ve paid zero dollars, even after ’07 and ’08 and ’09, people slid from three times as much to one-and-a-half times as much, but they didn’t go below the Social Security amount. The result is in Chile, for example, 72 percent — they have 72 percent of the GDP in savings. It has — it has increased the economy, increased the growth of jobs, increased the amount of wealth and it dramatically solves Social Security without a payment cut and without having to hurt anybody.

So I think you can have a series of entitlement reforms that, frankly, make most of this problem go away without going through the kind of austerity and pain that this city likes.

BLITZER: Let’s talk about that, Congresswoman Bachmann.

Social Security, Medicare, health care — what would you cut first?

What would you tackle if you were president of the United States?

BACHMANN: Let me answer that in the context of the super committee, because I was involved in the middle of that fight as a member of Congress this summer. And my voice said this. I said it’s time for us to draw a line in the sand. We have sufficient revenues coming in to pay the interest on the debt.

But the real issue was, were we going to give Congress another $2.4 billion in borrowing authority?

In other words, another blank check to the president. Because, again, consider the context. A little of four years ago, we were just over $8 trillion in debt. We are now $15 trillion in debt in just over four years. Now we’re talking about — if the gentleman is correct — adding another $11 trillion in debt over 10 years, or potentially $8.5 trillion, according to the super committee.

All that they were asked to do is cut back on $1.2 trillion of that increase in debt. We aren’t even talking about the central issue, which is balancing the budget. We need to balance the budget and then chip away at the debt. This isn’t Monopoly money.

Because what we need to recognize is that when we are sending interest money over to China, with whom we are highly in hock, we’re not just sending our money. We’re sending our power.

What will happen is that our national security and our military will decrease and our money will increase China’s military. So think about that.

Our money will be used to grow China’s military at the expense of the United States military. That should give every American pause.

BLITZER: All right. I want everybody to stand by and all of you are going to weigh in. We’ve got a lot more to discuss, important issues that we’re talking about. Collect your thoughts for a moment.

More tough questions for the candidates including their plans for protecting the border, reducing illegal immigration — we’re live from Constitution Hall here in Washington, D.C. This is the CNN Republican National Security Debate. [applause]

[commercial break]

BLITZER: Welcome back to the CNN National Security Debate.

The next President of the United States will certainly have to tackle conflicts in the Middle East. You’re looking at these live pictures coming in from Cairo’s Tahrir Square right now, the middle of the night in Egypt.

Thousands of Egyptians are again protesting their government as the Arab Spring continues into the winter months.

The candidates will weigh in on this and much, much more. We’re being seen live, around the world right now. Remember, you can send in your questions and comments at cnnpolitics.com; at Twitter, remember hash tag #cnndebate.

The Republican National Security Debate — we’ll be right back.

[commercial break]

BLITZER: Welcome back to the historic Constitution Hall here in Washington, D.C. We’re at the CNN Republican National Security Debate. Let’s go right to the audience. We have a question. Please, give us your name and your organization.

TRULUCK: Thank you. My name is Phil Truluck. I’m executive vice president and chief operating officer of The Heritage Foundation. And I’d like to thank all the candidates for joining us tonight. I know some of you may want to be in other places, but we appreciate you being here and sharing your views with us.

Let’s — I’d like to turn it back a little bit, a little closer to home, and talk about what’s going on on the borders, our southern border. As all of you know, the drug-related crimes and violence are getting heavier and heavier in that area.

First, do you consider that to be a national interest threat? And, secondly, what could we be doing with the Mexican government to help stop these drug cartels?

BLITZER: Let’s go to Governor Perry. You represent the state with the longest border with Mexico right now. What do you think you should do, if you were President of the United States, as far as using the United States military?

PERRY: Well, let me kind of broaden it out. I think it’s time for a 21st century Monroe Doctrine. When you think about what we put in place in the — in the 1820s, and then we used it again in the 1960s with the Soviet Union. We’re seeing countries start to come in and infiltrate. We know that Hamas and Hezbollah are working in Mexico, as well as Iran, with their ploy to come into the United States.

We know that Hugo Chavez and the Iranian government has one of the largest — I think their largest embassy in the world is in Venezuela. So the idea that we need to have border security with the United States and Mexico is paramount to the entire western hemisphere.

So putting that secure border in place with strategic fencing, with the boots on the ground, with the aviation assets, and then working with Mexico in particular, whether it’s putting sanctions against the banks, whether it’s working with them on security with Mexico, all of those together can make that country substantially more secure and our borders secure.

As the President of the United States, I will promise you one thing, that within 12 months of the inaugural, that border will be shut down, and it will be secure. [applause]

BLITZER: Congressman Paul, you’re from Texas. Do you agree with your governor?

PAUL: Not entirely. [laughter]

No, the drug was mentioned. I think that’s another war we ought to cancel, because it’s… [applause]… to nobody’s benefit. And that’s where the violence is coming from. But, yes, we do have a national responsibility for our borders. What I’m, sort of, tired of is all the money spent and lives lost worrying about the borders between Pakistan and Afghanistan and forgetting about our borders between the United States and Mexico. We should think more about, you know, what we do at home.

We need better immigration services, obviously. But, you know, if you subsidize something or give people incentives, you get more of it. So if you give easy road to citizenship, you’re going to have more illegals. If you have a weak economy, which is understandable and we should have prevented, that’s understandable.

But giving — mandating to the states and to Texas that we have to provide free medical care and free education, that’s a great burden. It’s a great burden to California and all the border states.

So I would say eliminate all these benefits and talk about eliminating the welfare state because it’s detrimental not only to here but the people that come because that’s the incentive to bring their families with them.

BLITZER: But I just want you to clarify. When you say cancel the war on drugs, does that mean legalize all these drugs?

PAUL: I think the federal war on drugs is a total failure. [applause]

You can — you can at least let sick people have marijuana because it’s helpful, but compassionate conservatives say, well, we can’t do this; we’re going to put people who are sick and dying with cancer and they’re being helped with marijuana, if they have multiple sclerosis — the federal government’s going in there and overriding state laws and putting people like that in prison.

Why don’t we handle the drugs like we handle alcohol? Alcohol is a deadly drug. What about — the real deadly drugs are the prescription drugs. They kill a lot more people than the illegal drugs.

So the drug war is out of control. I fear the drug war because it undermines our civil liberties. It magnifies our problems on the borders. We spend — like, over the last 40 years, $1 trillion on this war. And believe me, the kids can still get the drugs. It just hasn’t worked.

BLITZER: Herman Cain, let me let you…[applause]… weigh in.

CAIN: Yes. Allow me to answer the gentleman’s question. The answer is yes. An insecure border is a national security threat for the following reasons.

Number one, we know that terrorists have come into this country by way of Mexico. Secondly, 40 percent of the people in Mexico, according to a survey, already believe that their country is a failed state. Thirdly, the number of people killed in Mexico last year equals the number of people killed in Afghanistan and Iraq combined.

So yes, so let’s solve the whole problem. Number one, secure the border for real. Number two, enforce the laws that are already there. We don’t need new laws. Number three, promote the current path to citizenship. Clean up the bureaucracy in Washington, D.C. so people can come through the front door instead of sneaking in the side door. And, number four, to deal with the illegals that are already here, empower the states to do what the federal government is not capable of doing. [applause]

BLITZER: Let’s stay on this subject. Go ahead, please.

QUESTION: I have a question about high-skilled immigration. We hear a lot about low-skilled immigration, so I want to ask you about high-skilled immigration.

What would you do to ensure that the United States is as welcoming as possible to the world’s skilled immigrants and entrepreneurs?

BLITZER: Senator Santorum?

SANTORUM: Well, as the son of a legal immigrant to this country, I strongly believe in legal immigration and believe we are that shining city on the hill, that our future — if you look at all of the jobs that are being created in our economy today, a huge percentage of them come from the legal immigrants of this county — country who have innovated, who created great products, who created great companies and employed lots of people.

That’s one of the reasons that — that I put together my economic plan, was to take all that great innovation that’s coming as a result, in part, of legal immigration and make sure that those products that are being created are actually made here in America.

That’s part of the problem that — you know, Reaganomics was criticized as trickle-down. Problem is, we’re not seeing that money trickle down to the blue-collar workers in America. And that’s why I put forth a four-point economic plan to revitalize manufacturing that begins with zeroing out the corporate tax for manufacturers; also, regulatory reform, repatriation of profits, if invested in this country, to pay no taxes; and finally, energy policy that will explode the energy industry in this country.

We do those things, we’ll not only have the innovation, which I support, coming from legal — legal immigrants, but we’ll have that money trickle down to blue-collar workers and we can see that income mobility that a lot of people are right in that is not happening in America.

BLITZER: Speaker Gingrich, let me let you broaden out this conversation. Back in the ’80s — and you remember this well. I was covering you then. Ronald Reagan and you — you voted for legislation that had a pathway to citizenship for illegal immigrants, as you well remember. There were, what, maybe 12 million, 10 million — 12 million illegal immigrants in the United States right now.

Some called it amnesty then; they still call it amnesty now. What would you do if you were President of the United States, with these millions of illegal immigrants, many of whom have been in this country for a long time?

GINGRICH: Let me start and just say I think that we ought to have an H-1 visa that goes with every graduate degree in math, science and engineering so that people stay here. [applause]

You know, about five blocks down the street, you’ll see a statue of Einstein. Einstein came here as an immigrant. So let’s be clear how much the United States has drawn upon the world to be richer, better and more inclusive.

I did vote for the Simpson-Mazzoli Act. Ronald Reagan, in his diary, says he signed it — and we were supposed to have 300,000 people get amnesty. There were 3 million. But he signed it because we were going to get two things in return. We were going to get control of the border and we were going to get a guest worker program with employer enforcement.

We got neither. So I think you’ve got to deal with this as a comprehensive approach that starts with controlling the border, as the governor said. I believe ultimately you have to find some system — once you’ve put every piece in place, which includes the guest worker program, you need something like a World War II Selective Service Board that, frankly, reviews the people who are here.

If you’re here — if you’ve come here recently, you have no ties to this country, you ought to go home. period. If you’ve been here 25 years and you got three kids and two grandkids, you’ve been paying taxes and obeying the law, you belong to a local church, I don’t think we’re going to separate you from your family, uproot you forcefully and kick you out.

The Creeble Foundation is a very good red card program that says you get to be legal, but you don’t get a pass to citizenship. And so there’s a way to ultimately end up with a country where there’s no more illegality, but you haven’t automatically given amnesty to anyone.

BLITZER: Congresswoman Bachmann, you agree with the speaker?

BACHMANN: Well, I don’t agree that you would make 11 million workers legal, because that, in effect, is amnesty. And I also don’t agree that you would give the DREAM Act on a federal level. And those are two things that I believe that the speaker had been for, and he can speak for himself.

But those are two areas that I don’t agree with. What I do think, though, is what Steve — what Steve Jobs said to President Obama. He had said to President Obama that he had to move a great deal of his operation over to China because he couldn’t find 30,000 engineers to be able to do the work that needed to be done.

That’s what we want to do. We do want to have people. And I agree with the speaker, people like chemists and engineers, and people who are highly skilled.

We think about the United States and what’s in the best interests of the United States. If we can utilize these workers, like Steve jobs wanted to, then we need to offer those visas. That will help the United States. But I don’t agree that we should make 11 million workers who are here illegally legal.

BLITZER: Let me let the speaker respond to that.

GINGRICH: Well, I mean, two things, first of all, in the DREAM Act, the one part that I like is the one which allows people who came here with their parents to join the U.S. military, which they could have done if they were back home, and if they serve on it with the U.S. military to acquire citizenship, which is something any foreigner can do.

And I don’t see any reason to punish somebody who came here at three years of age, but who wants to serve the United States of America. I specifically did not say we’d make the 11 million people legal.

I do suggest if you go back to your district, and you find people who have been here 25 years and have two generations of family and have been paying taxes and are in a local church, as somebody who believes strongly in family, you’ll have a hard time explaining why that particular subset is being broken up and forced to leave, given the fact that they’ve been law-abiding citizens for 25 years.

BLITZER: Congresswoman Bachmann, you want to respond? [applause]

BACHMANN: If I understood correctly, I think the speaker just said that that would make 11 people — 11 million people who are here illegally now legal. That’s really the issue that we’re dealing with. And also, it would be the DREAM Act, the federal DREAM Act, which would offer taxpayer-subsidized benefits to illegal aliens. We need to move away from magnets, not offer more.

BLITZER: Let’s broaden it out.

Governor Romney, where do you stand? Are you with the speaker, that some of those illegal immigrants — I think — he didn’t say all — some of them, if they have roots, they belong to a church, for example, should be allowed to stay in this country? ROMNEY: Look, amnesty is a magnet. What when we have had in the past, programs that have said that if people who come here illegally are going to get to stay illegally for the rest of their life, that’s going to only encourage more people to come here illegally.

The right course for our immigration system is to say we welcome people who want to come here legally. We’re going to have a system that makes that easier and more transparent. But to make sure we’re able to bring in the best and brightest — and, by the way, I agree with the speaker in terms of — I’d staple a green card to the diploma of anybody who’s got a degree of math, science, a Masters degree, Ph.D.

We want those brains in our country. But in order to bring people in legally we’ve got to stop illegal immigration. That means turning off the magnets of amnesty, in-state tuition for illegal aliens, employers that knowingly hire people that have come here illegally.

We welcome legal immigration. This is a party, this is a party that loves legal immigration. But we have to stop illegal immigration for all the reasons the questioner raised, which is, it is bringing in people who in some cases can be terrorists, in other cases they become burdens on our society.

And we have to finally have immigration laws that protect our border, secure the border, turn off the magnets, and make sure we have people come to this country legally to build our economy.

BLITZER: Just to precise, and I’ll give Speaker Gingrich a chance to respond. Are you saying that what he’s proposing, giving amnesty in effect, or allowing some of these illegal immigrants to stay, is a magnet that would entice others to come to this country illegally?

ROMNEY: There’s no question. But to say that we’re going to say to the people who have come here illegally that now you’re all going to get to stay or some large number are going to get to stay and become permanent residents of the United States, that will only encourage more people to do the same thing.

People respond to incentives. And if you can become a permanent resident of the United States by coming here illegally, you’ll do so. What I want to do is bring people into this country legally, particularly those that have education and skill that allows us to compete globally. [applause]

GINGRICH: I do not believe that the people of the United States are going to take people who have been here a quarter century, who have children and grandchildren, who are members of the community, who may have done something 25 years ago, separate them from their families, and expel them.

I do believe if you’ve been here recently and have no ties to the U.S., we should deport you. I do believe we should control the border. I do believe we should have very severe penalties for employers, but I would urge all of you to look at the Krieble Foundation Plan.

I don’t see how the — the party that says it’s the party of the family is going to adopt an immigration policy which destroys families that have been here a quarter century. And I’m prepared to take the heat for saying, let’s be humane in enforcing the law without giving them citizenship but by finding a way to create legality so that they are not separated from their families.

BLITZER: Governor Perry, are you with the speaker or with the governor, Governor Romney? [applause]

PERRY: Here we go again, Mitt. You and I standing by each other again and you used the words about the magnets. And that’s one of the things that we obviously have to do is to stop those magnets for individuals to come in here.

But the real issue is securing that border. And this conversation is not ever going to end until we get the border secure. But I do think that there is a way. That after we secure that border that you can have a process in place for individual who are law- abiding citizens who have done only one thing, as Newt says, 25 years ago or whatever that period of time was, that you can put something in place that basically continues to keep those families together.

But the idea that we’re having this long and lengthy conversation here, until we have a secure border is just an intellectual exercise. You’ve got to secure the border first. And I know how to do that. I’ve been dealing with it for 10 years.

And we have to put the boots on the ground and the aviation assets in place, and secure that border once and for all, and be committed to it.

BLITZER: Let me let Governor Romney respond.

ROMNEY: Yes, I don’t disagree with what Governor Perry indicated. Certainly we have to secure the border. And we talk about people who have been here 25 years, that is the extreme exception…

BLITZER: You would let them stay.

ROMNEY: … not the rule.

BLITZER: You would let them stay?

ROMNEY: I’m not going to start drawing lines here about who gets to stay and who get to go. The principle is that we are not going to have an amnesty system that says that people who come here illegally get to stay for the rest of their life in this country legally.

The answer is we’re going to have a system that gives people who come legally a card that identifies them as coming here legally. Employers are going to be expected to inspect that card, see if they’re here legally. On that basis we’re going to be able to bring you to this country.

The number of people that we need to power our industries, whether that’s agriculture or high tech, we welcome people in here with visa programs. We have a whole series of legal programs. But the idea of focusing a Republican debate on amnesty and who we’re going to give it to, is a huge mistake.

Secure our border, protect legal immigration, and return to a system that follows the law.

BLITZER: All right. Let’s take another…[applause]… quick break because we have a lot more to — I want to bring everybody into this conversation. We’re also going to broaden the conversation and go to the Middle East and see what’s going on in the so-called Arab Spring.

Don’t forget, Twitter — you can weigh in on what’s going on, #CNNdebate. Also, go to Facebook, CNNpolitics.com. Much more from historic Constitution Hall, here in the nation’s capital, right after this.

[commercial break]

[applause]

BLITZER: All right. Welcome back to the CNN Republican national security debate. Let’s go right to the audience.

Please give us your name and your organization.

QUESTION: I’m David Addington. I’m a vice president with the Heritage Foundation. [applause]

Serious violence has erupted in Syria between the repressive al- Assad regime and some elements of the people of Syria. Syria borders a major ally of the United States, NATO ally, Turkey, and three other friendly countries, Israel, Jordan and Iraq.

In your view, what are the interests of the United States in this region and what would you do to protect them?

BLITZER: Herman Cain, you may not know this, but today Governor Perry called for a no-fly zone, for the U.S. to participate in a no- fly zone over Syria. Would you go that far? Would you support that?

CAIN: No, I would not. I would work with our allies in the region to put pressure to be able to try and get our allies and other nations to stop buying oil from Syria. That would be one thing that I would do, but I would not support a no-fly zone.

The most effective tools that we have in any of these situations are a strong military, which it is getting weaker, unfortunately, and our own economic strength.

This whole discussion tonight about cutting and compromise, we didn’t spend enough time talking about the other part of the problem — growing this economy, because this administration has failed dismally at growing this economy. We can cut until the cows come home but it still would not solve the problem until we have effective economic growth.

BLITZER: Governor Perry, why would you support a no-fly zone over Syria?

PERRY: Obviously, that’s one of a multitude of — of sanctions and actions that I think work very well from the standpoint of being able to pressure that regime, overt, covert, economic sanctions.

I mean I think there are a number of ways. But when you put the no-fly zone above Syria, it obviously gives those dissidents and gives the military the opportunity to maybe disband, that want to get out of the situation that they’re in in Syria, as well.

So I think if we’re serious about Iran — and that’s what we’re really talking about here. We’re talking about Syria is a partner with Iran in exporting terrorism all across that part of the world and — and around the globe.

So if we’re serious about Iran, then we have to be serious about Syria, as well.

So I think a no-fly zone is an option of one of a multitude of options that we should be using. And we should put them in place if we’re serious about Iran not getting the nuclear weapon.

BLITZER: Governor Huntsman, let me bring you into this conversation.

We just got a question from Twitter. I’ll read it to you.

“So many people view the Arab spring as a good thing. Given the recent violence in Egypt, do you worry this can go bad?”

And we’ve got some live pictures we’re going to show our viewers out there of Tahrir Square in Cairo right now. Thousands of people are protesting the military regime in Egypt right now.

What do you say to this person who sent this — this — this Twitter message to us?

HUNTSMAN: His — history will tell. We missed the Persian spring. The president failed on that front. We go into Libya, where, to my mind, we don’t have any definable American interests. We’ve got Syria now on the horizon, where we do have American interests. It’s called Israel. We’re a friend and ally. They’re a friend and ally. And we need to remind the world what it means to be a friend and ally of the United States.

And we have nuclearization in Iran. Centrifuges spinning. At some point, they’re going to have enough in the way of fissile material out of which to make a weapon. That’s a certainty.

We had a discussion earlier tonight about sanctions. Everybody commented on sanctions. Sanctions aren’t going to work, I hate to break it to you. They’re not going to work because the Chinese aren’t going to play ball and the Russians aren’t going to play ball.

And I believe Iran has already — the mullahs have already decided they want to go nuclear.

Why?

They have looked at North Korea. They’ve got a weapon. Nobody touches them. They like at Libya. Libya gave up their weapon in exchange for friendship with the world. Look where they are.

So I say let’s let history be our guide. We saw the end of the Ottoman Empire in 1919. We saw the region transform and make itself into something different. We saw changes in 1947.

I think we do our national interests a disservice by jumping in too soon and taking up sides with people we don’t fully understand, Islamist groups, pan-Arab groups.

Our interest in the Middle East is Israel. And our interest is to ensure that Israel — that Iran does not go nuclear.

BLITZER: All right, let’s stay in the region.

We have another question from the audience.

KATHERINE ZIMMERMAN: I’m Katherine Zimmerman from the American Enterprise Institute Political Press Project.

The United States adopted a policy of disengagement with Somalia after its retreat following Black Hawk down.

Today, an al Qaeda affiliate, Al Shabab, controls significant territory in that country.

What can the United States do to prevent Al Shabab from posing the same threat that al Qaeda did from Afghanistan 10 years ago?

BLITZER: Congressman Paul?

PAUL: You’re talking about al Qaeda, correct?

ZIMMERMAN: Right.

PAUL: You have to understand who the al Qaeda really is. The — the al Qaeda responds in a very deliberate fashion. As a matter of fact, Paul Wolfowitz explained it very clearly after 9/11.

He said that al Qaeda is inspired by the fact that we had bases in Saudi Arabia. So if you want to inspire al Qaeda, just meddle in — in that region. That will inspire the al Qaeda. As a matter of fact, he went on to say that that was a good reason for us to remove the base that we had had in 15 years in — in Saudi Arabia and that we should have done that.

So there is a response. Al Qaeda responds to that and they — they are quite annoyed with us. So if you drop — if you have a no- fly zone over Syria, that’s an act of war.

What if we had China put a no-fly zone over our territory? I don’t think — I don’t think we would like that.

And I think we should practice a policy of good will to other people. What about saying that we don’t do anything to any other country that we don’t have them do to us? When we have a no-fly zone over Iraq, it was for — meant to be regime change. And evidently, some want to have regime change.

What is our business? Why should we spend more money and more lives to get involved in another war? That’s an — that is the internal affairs of the other nations and we don’t want — we don’t need another nation to start nation building. We have way too many already. So this is just looking for more trouble. I would say why don’t we mind our own business? [applause]

BLITZER: Governor Romney, where do you stand?

ROMNEY: Wolf, that is a foreign policy. It’s different than President Obama’s, but similar in some respects. President Obama’s foreign policy is one of saying, first of all, America’s just another nation with a flag.

I believe America is an exceptional and unique nation. President Obama feels that we’re going to be a nation which has multipolar balancing militaries. I believe that American military superiority is the right course. President Obama says that we have people throughout the world with common interests. I just don’t agree with him. I think there are people in the world that want to oppress other people, that are evil.

President Obama seems to think that we’re going to have a global century, an Asian century. I believe we have to have an American century, where America leads the free world and the free world leads the entire world.

President Obama apologizes for America. It is time for us to be strong as a nation. And if we are strong, with a military and economy that are so strong, no one in the world will try and attempt to threaten us or to attack our friends.

BLITZER: Just to be precise, are you with Governor Perry…[applause]… on declaring a no-fly zone over Syria?

ROMNEY: No, this is not — this is not the time for a no-fly zone over Syria. This is the time for us to use not only sanctions, but covert actions within Syria to get regime change there. There are people in the military that are shifting over, that are — that are becoming part of the rebel effort.

We should support those efforts. We need to meet with the Alawites to make sure they understand that they have a future after Assad, that they don’t have to link with him. He’s getting pressure now from both Turkey as well as Saudi Arabia. They’re coming and putting pressure on him. The Arab League is putting pressure on him.

We — that’s the right way to go. And by the way, they have 5,000 tanks in Syria. A no-fly zone wouldn’t be the right military action. Maybe a no-drive zone. I mean, this is — this is a nation — this is a nation which is not bombing its people, at this point, and the right course is not military.

BLITZER: We’re ready to wrap it up. But let me have Governor Perry react.

PERRY: Yes, as I said, I said the no-fly zone is one of the options that we have. But I think you need to leave it on the table to make sure, because this is not just about Syria. This is about Iran, and those two, as a partnership and exporting terrorism around the world. And if we’re going to be serious about saving Israel, we better get serious about Syria and Iran, and we better get serious right now.

BLITZER: All right. Let’s take another question from the audience. This is last question. Go ahead.

QUESTION: My name is Mark Teese and I’m a visiting fellow with the American Enterprise Institute. And my question has to do with the unexpected. During the 200 Presidential debates, Governor George W. Bush was never asked about the threat from Al Qaida, yet the battle with Al Qaida dominated his presidency. What national security issue do you worry about that nobody is asking about, either here or in any of the debates so far?

BLITZER: All right. Let’s go down the line and start with Senator Santorum. Give us a quick answer. What do you think?

SANTORUM: Well, I’ve spent a lot of time and concern — and Rick mentioned this earlier — about what’s going on in Central and South America. I’m very concerned about the militant socialists and there — and the radical Islamists joining together, bonding together.

I’m concerned about the spread of socialism and that this administration, with — time after time, whether it was the delay in moving forward on Colombia’s free trade agreement, whether it was turning our back to the Hondurans and standing up for democracy and the — and the rule of law.

And we took the side with Hugo Chavez and Fidel Castro for a corrupt President. We’ve sent all the wrong signals to Central and South America.

BLITZER: Thank you.

SANTORUM: You know, maybe the first trip I would take to Israel, but my second trip, and third and fourth, would be into Central and South America. We need to build a solid hemisphere and those people — and the people in south of our border need to know that we are going to…

BLITZER: All right.

SANTORUM: … solidarity with them and build strong alliances.

BLITZER: Thank you, Senator.

I want to do this quickly, if we can, because we don’t have a lot of time.

Congressman?

PAUL: I worry most about overreaction on our part, getting involved in another war when we don’t need to, when we have been attacked, and our national security has not been at threat. And I worry a lot about people never have come around to understanding who the Taliban is and why they are motivated.

Taliban doesn’t mean they want to come here and kill us. The Taliban means they want to kill us over there because all they want to do is get people who occupy their country out of their country, just like we would if anybody tried to occupy us.

BLITZER: Governor Perry? [applause]

PERRY: I think, obviously, the big issue out there, and we’ve talked about it before, but I happen to think it’s China and how we’re — we’re going to deal with China.

And Communist China — when I think back about Ronald Reagan, and he said that the Soviet Union was destined for the ash heap of history, and he was correct, and I happen to think that Communist China is destined for the ash heap of history because they are not a country of virtues.

When you have 35,000 forced abortions a day in that country; when you have the cybersecurity that the PLA has been involved with, those are great and — and major issues, both morally and security-wise that we’ve got to deal with now.

BLITZER: All right. We’ve got to keep it brief. But, go ahead…[applause]… Governor Romney.

ROMNEY: Rick, in my view, is right with regards to long-term security interests, and that’s — and that’s China, although that’s very much on our agenda.

Immediately, the most significant threat is, of course, Iran becoming nuclear.

But I happen to think Senator Santorum is right with regards to the issue that doesn’t get enough attention. That’s the one that may come up that we haven’t thought about, which is Latin America. Because, in fact, Congressman, we have been attacked. We were attacked on 9/11. There have been dozens of attacks that have been thwarted by our — by our security forces. And we have, right now, Hezbollah, which is working throughout Latin America, in Venezuela, in Mexico, throughout Latin America, which poses a very significant and imminent threat to the United States of America.

BLITZER: Thank you, Governor. Mr. Cain? [applause]

CAIN: Having been — having been a ballistics analyst and a computer scientist early in my career, cyber attacks: that’s something that we do not talk enough about, and I happen to believe that that is a national security area that we do need to be concerned about.

BLITZER: Speaker Gingrich? [applause]

GINGRICH: I — I helped create the Hart-Rudman Commission with President Clinton, and they came back after three years and said the greatest threat to the United States was the weapon of mass destruction in an American city, probably from a terrorist. That was before 9/11.

That’s one of the three great threats. The second is an electromagnetic pulse attack which would literally destroy the country’s capacity to function.

And the third, as Herman just said, is a cyber attack. All three of those are outside the current capacity of our system to deal with.

BLITZER: Thank you. Congresswoman?

BACHMANN: Well, I would agree with what my colleagues said up here on the stage. And also, we need to remember, we won the peace in Iraq. And now President Obama is intentionally choosing to give that peace away.

This is a significant issue because we’re taking the terrorist threat away from the Middle East, bringing it to the United States.

We talked about Al-Shabaab. Al-Shabaab is real. In my home state of Minnesota, we’ve just had two convictions of two women that are financing terror with Al-Shabaab. This threat, I believe, now is in the United States and now the threat has come home and that’s what we have to deal with.

BLITZER: Governor Huntsman?

HUNTSMAN: I guess I could say China because I know a little bit about the subject matter, but they’re in for real trouble ahead.

So I have to say that our biggest problem is right here at home. And you can see it on every street corner. It’s called joblessness. It’s called lack of opportunity. It’s called debt, that has become a national security problem in this country. And it’s also called a trust deficit, a Congress that nobody believes in anymore, an executive branch that has no leadership, institutions of power that we no longer believe in.

How can we have any effect on foreign policy abroad when we are so weak at home? We have no choice. We’ve got to get on our feet here domestically.

BLITZER: Thank you to…[applause]… all of you. And thanks to all of you as well. We have to leave it right there. We want to thank our partners, the American Enterprise Institute. We want to thank the Heritage Foundation. Thanks very much for watching. I’m Wolf Blitzer here at Constitution Hall. [applause]

November 12, 2011: CBS / National Journal / South Carolina Republican Party Republican Presidential Debate Transcript

Republican Candidates Debate in Spartanburg, South Carolina November 12, 2011

PARTICIPANTS:
Representative Michele Bachmann (MN);
Herman Cain (GA);
Former Speaker of the House Newt Gingrich (GA);
Former Governor Jon Huntsman (UT);
Representative Ron Paul (TX);
Governor Rick Perry (TX);
Former Governor Mitt Romney (MA); and
Former Senator Rick Santorum (PA)

MODERATORS:
Major Garrett (National Journal);
Scott Pelley (CBS News)

PELLEY: Good evening from Wofford College in Spartanburg, South Carolina. I’m Scott Pelley with CBS News along with my colleague Major Garrett of National Journal. In just under a year now, Americans will go to the polls to choose a president. Tonight, CBS News and National Journal are pleased to bring you a discussion of the issues by the Republican candidates for their party’s nomination.

The focus will be foreign policy and national security, the president’s role as commander in chief. Consider this, the 9/11 attacks came in the eighth month of a new presidency, the Bay of Pigs in the 13th week, and the Civil War on the 40th day of a new presidency. Reminders from history that a president must be prepared to deal with a crisis from day one.

The ground rules for tonight’s debate are simple. A candidate who is asked a question will have one minute to respond and then at a discretion of the moderators, there can be a 30-second follow-up or a 30-second rebuttle from another candidate. The debate will run a total of 90 minutes. The first hour will be broadcast right here on the CBS television network, the entire 90 minutes will be streamed on CBSNews.com and NationalJournal.com. And we invite you to submit questions during the debate to either w– website. Joining me now in asking the questions, Major Garrett.

GARRETT: Scott, thank you very much. One more piece of housekeeping. Let’s introduce the candidates. Former Utah Governor, Jon Huntsman. Representing the 6th District of Minnesota, Congresswoman Michele Bachmann. Representing the 14th District of Texas, Congressman Ron Paul.

From Atlanta, Georgia, businessman Herman Cain. Former Massachusetts governor, Mitt Romney. Former House speaker, Newt Gingrich. Current Texas governor, Rick Perry. [cheering] And former Pennsylvania senator, Rick Santorum. Mr. Cain, I’d like to begin this evening with you, sir.

CAIN: Yes.

GARRETT: This week, a U.N. nuclear watchdog agency provided additional credible evidence that Iran is pursuing a nuclear weapon. If you were president right now, what would you do specifically that this administration is not doing to prevent Iran from obtaining a nuclear weapon?

CAIN: The first thing that I would do is to assist the opposition movement in Iran, that’s tryin’ to overthrow the regime. Our enemies are not the people of Iran, it’s the regime. And a regime change is what they are trying to achieve. Secondly, we need to put economic pressure on Iran, by way of our own energy independence strategy. By having our own energy independence strategy, we will impact the price of oil in the world markets, because Iran uses oil not only as a– means of currency, but they use it as a weapon.

One of the reasons that they are able to afford that nuclear weapons program, is because of oil. Secondly, we would then work to increase sanctions on Iran, along with our friends and our allies. So whereas we will not be– so that’s why I do believe that they have a nuclear weapons program and they are closer to having nuclear weapon, stopping them– the only we can stop them is through economic means.

GARRETT: A quick follow up, Mr. Cain. You say assisting the opposition, would you entertain military assistance and opposition?

CAIN: I would not entertain– military opposition. I’m talkin’ about to help the opposition movement within the country. And then there’s one other thing that we could do. We could deploy our ballistic missile defense capable warships strategically in that part of the world. We have the biggest fleet of those warships in the world. And we could use them strategically in the event that they were able to fire a ballistic missile.

PELLEY: Governor Romney, would it be worth goin’ to war to prevent Iran from obtaining a nuclear weapon?

ROMNEY: Well, let’s– let’s start back from there and let’s talk about where we are. This is, of course, President Obama’s greatest failing, from a foreign policy standpoint, which is he recognized the gravest threat that America and the world faces– and faced was a nuclear Iran and he did not do what was necessary to get Iran to be dissuaded from their nuclear folly. What he should have done is speak out when dissidents took the streets and say, “America is with you.” And work on a covert basis to encourage the dissidents.

Number two, he should have put– put in place crippling sanctions against Iran. But instead of getting Russia, for instance, to– what– what he gave in our– our missile defense system to agree to– to stand with those crippling sanctions, he gave Russia what they wanted, their number one foreign policy objective, and got nothing in return.

PELLEY: Governor, on the question. We’re gonna adherer to time, very quickly. But let me–

ROMNEY: I get 60 seconds.

PELLEY: Yes, sir, and that was–

ROMNEY: That was 30.

PELLEY: The– the 60–

ROMNEY: Sorry, it started at yellow, so I– I have much more time to go.

PELLEY: You– you know what, Governor? I stand corrected. You are right. Please continue.

ROMNEY: Fin– finally, the president should have built credible– threat of military action, and made it very clear that the United States of America is willing, in the final analysis, if necessary, to take military action to keep Iran from having a nuclear weapon. Look, one thing you can know– and that is if we reelect Barack Obama, Iran will have a nuclear weapon. And if we elect Mitt Romney, if you’d like me as the next president, they will not have a nuclear weapon.

PELLEY: But sir, let me– you just described where we are today, and that’s what you’re going to have to deal with if you become president. How do you prevent them from obtaining a nuclear weapon? Is it worth going to war to prevent that?

ROMNEY: Well, it’s worth putting in place crippling sanctions. It’s worth working with the insurgents in the company to encourage regime change in the country. And if all else fails, if after all of the work we’ve done, there’s nothing else we can do beside mil– take military action, then of course you take military action. It is unacceptable for Iran to have a nuclear weapon.

We will not allow Iran to have a nuclear weapon. This term “unacceptable” has been applied by several presidents over history, and our current president has made it very clear that he’s not willing to do those things necessary to get Iran to be dissuaded from their nuclear folly. I will take a different course. I will make sure that the sanctions, diplomatic pressure, economic pressure, and support of insurgents within the country help them become dissuaded to get away from their nuclear ambition. And finally–

PELLEY: This time, it is time.

ROMNEY: Yeah, and finally, have to– have to have military presence there.

PELLEY: –30 seconds, though, on the follow ups. We’re gonna try to adhere to the time.

GARRETT: Mr. Speaker, is this the right way to look at this question, war or not war? Or do you see other options, diplomatically, or other non-war means that the United States has in its possession to deal with Iran that it has not employed?

GINGRICH: Well, let me start and say that both the answers you just got are superior to the current administration. And– you know, there are a number of ways to be smart about– Iran and relatively few ways to be dumb. And the administration skipped all the ways to be smart.

GARRETT: Could you tell us the smart ways, Mr. Speaker?

GINGRICH: Sure. First of all, as maximum covert operations– to block and disrupt the Iranian program– in– including– taking out their scientists, including breaking up their systems. All of it covertly, all of it deniable. Second, [laughing] maximum– maximum coordination with the Israelis– in a way which allows them to maximize their impact in Iran. Third, absolute strategic program comparable to what President Reagan, Pope John Paul II, and Margaret Thatcher did in the Soviet Union, of every possible aspect short of war of breaking the regime and bringing it down. And I agree entirely with Governor Romney, if in the end, despite all of those things– the dictatorship persists, you have to take whatever steps are necessary to break its capacity to have a nuclear weapon.

PELLEY: Congressman Paul, let me follow up with you for just 30 seconds. Is it worth going to war to prevent a nuclear weapon in Iran?

PAUL: No, it isn’t worthwhile. The only way you would do that is– you would have to go through Congress. We– we as commander in chief aren’t making the decision to go to war. You know, the old-fashioned way, the Constitution, you go to the Congress and find out if our national security is threatened. And– I’m afraid what’s going on right now is similar to the war propaganda that went on against Iraq.

And, you know, they didn’t have nuc– weapons of mass destruction. And it was orchestrated and it was– to me, a tragedy of what’s happened these past– last ten years, the death and destruction, $4 billion– $4 trillion in debt. So no, it’s not worthwhile goin’ to war. If you do, you get a declaration of war and you fight it and you win it and get it over with.

PELLEY: Thank you, Congressman. Governor Perry, what’s your appraisal of the combat situation on the ground in Afghanistan today and what would you change?

PERRY: Let me answer– the previous question very quickly for– if I– if I may.

PELLEY: Governor, I’d like to move on, could you give us a sense of your –of your appraisal of the combat situation?

PERRY: –I have a minute. And I can do both in one minute, I’ll promise you.

PELLEY: There– there you go.

PERRY: And the issue that has not been raised is that this country can sanction the Iranian Central Bank right now and shut down that country’s economy. And that’s what this president needs to do and the American people need to stand up and force him to make that stand today. Now let me address this issue of Afghanistan and how we deal with it. The mission must be completed there. The idea that we will have wasted our treasure and the lives of young Americans to not secure Afghanistan is not appropriate.

But the idea that we would give a timetable to our enemy is irresponsible from a military standpoint, it’s irresponsible from the lives of our young men and women. And it is irresponsible leadership of this president to give a timetable to pull out of any country that we’re in conflict with.

PELLEY: But Governor, if I can just follow up for 30 seconds. The question was, “What’s your appraisal of the combat situation on the ground there, and what would you change as commander in chief?”

PERRY: Well, obviously, we’re discussing with our commanders on the field– about what’s going on in– Afghanistan. I think we’re makin’ progress there. The issue is training up the Afghan security forces so that we’re comfortable that they can– protect that citizenry and continue to take the war to the terrorists that are using Afghanistan and Pakistan, I might add. It is a very complex part of the world. But I think that our military is doin’ the best job that they can– considering– the lack of support that they’re getting from this administration– telegraphing to the enemy when we’re gonna pull out.

GARRETT: Senator Santorum, I know you want to jump in on Iran. I’ll give you that opportunity in just a second. So let me merge two things if I could, just one second. The Taliban said earlier this summer quote, “The Afghans have an endless stamina for a long war.” If you were commander in chief, would you have endless stamina for victory in Afghanistan? And would you, this evening, define victory in Afghanistan for the American people? And please weigh in, I know you do want to, on Iran.

SANTORUM: Thank you very much, Major, I appreciate that. Victory against– the Taliban in Afghanistan is the– Taliban is a neutered force. They are no longer a security threat– to the– to the– Afghan people or to– to our country. That would be victory. It doesn’t mean wipe them out, we can’t wipe them out, but they’re no longer a security threat.

The bigger issue– and I know there’s those of us at the end, who don’t get a lot of questions. And so I– I– this was the– this is the most important national security issue that we’re gonna be dealin’ with here in this– in this year. And that’s the issue of Iran getting a nuclear weapon. I think everyone should have the opportunity to answer that question. Particularly me. I’ve been working on Iran since back in 2004. And I proposed exactly the things that Herman and– and Mitt Romney suggested, which was to give money to the– to the– to the rebel forces there to– to help the pro-democracy movement and to put tough sanctions in place.

I was opposed by President Bush. And yet, we were able to overcome that and pass the Iran Freedom and Support Act. I was able to get that done. And then President Bush didn’t provide money for the pro-democracy movement. And President Obama cut that money. What we– we have a situation that’s different. I disagree with Newt. [inaudible]…more sanctions and– and– and providing, you know, more support for the pro-democracy movement isn’t gonna be enough, in time. Read the I.A.E.A. report.

PELLEY: Senator, I’m sorry.

SANTORUM: They are… [inaudible].

PELLEY: That’s time. I’m sorry. We’re gonna try to adhere to time and be fair to everyone in the– application of that rule.

SANTORUM: I understand. Just let me finish my final comment. My final comment is we should be working with Israel right now to do what they did in Syria, what they did in Iraq, which is take out that nuclear capability before the next explosion we hear in Iran is a nuclear one and then the world changes.

PELLEY: That is time. Thank you. Representative Bachmann, do you think the 30,000 surge troops in Afghanistan have made a difference, and if so, where?

BACHMANN: They absolutely have, but it’s unfortunate, the request was made for 40,000 troops. President Obama dithered for approximately two months, when he should have given the full complement of 40,000 troops. When he gave 30,000 troops to the effort in Afghanistan, that meant that a decision had to be made. With 40,000 troops, they could have conducted the war going into the southern province in– in Helmand and also going into the eastern province and dealing with the problem all at once and coming to victory that much sooner and bringing our troops home.

When 30,000 troops were given, then our troops did the very best that they could by going into the south and dealing in the Helmand Province. We actually have seen improvement down by Kandahar. That’s a very good thing. And that’s because of the brave actions by our men and women in that area. However, we have to recognize, now President Obama has made a very fatal decision in Afghanistan. He’s made the decision that by next September, our troops will be withdrawn. If that is the case, how do we expect any of our allies to continue to work to– with us? How can we even begin to seek the peace with the Hikani Network that are in the eastern regions. It’s–

Various: Thank you. Thank you.

PELLEY: Thank you, Congress– Congresswoman Bach– Bachmann, thank you very much. Let me come over to you, Governor Huntsman. And– and ask you, we are seeing spikes in casualties in Afghanistan, in new places. Can you explain to me what’s happening there and how you would change that as commander in chief?

HUNTSMAN: Well, I think the– spikes obviously are driven by– lack of security, proper security, in certain parts of the country, which could plague us for a very, very long time to come. I take a different approach on Afghanistan. I say it’s time to come home. I say this– I say this nation has achieved its key objectives in Afghanistan. We’ve had free elections in 2004. We’ve uprooted the Taliban. We’ve dismantled Al Qaeda. We have killed Osama bin Laden. I say this nation’s future is not Afghanistan. This nation’s future is not Iraq. This nation’s future is how prepared we are to meet the 21st Century competitive challenges. That’s economic and that’s education. And that’s gonna play out over the Asia-Pacific region. And we’re either prepared for that reality or we’re not. I don’t want to be nation building in Afghanistan when this nation so desperately needs to be built.

PELLEY: Make sure I understand. Bring all the troops home today?

HUNTSMAN: Here’s what I would keep behind, because we still have work to do. We don’t need 100,000 troops nation building, many of whom can’t cross the wire. I think we need a component that gathers tactical intelligence. We need enhanced special forces, response capability for rapid response. And we need some ongoing commitment to train the local Afghan National Army. That’s not 100,000 troops. That’s well south of that. We are fighting an asymmetric threat, a counterterror threat. Not only there, but in Waziristan and every other corner of the world. And we need to prepare for that as a reality of our 21st Century foreign policy.

PELLEY: And that’s time. Thank you, sir.

GARRETT: Governor Romney, a much smaller footprint in Afghanistan? Do you support that? And secondarily, sir, is it time or would it ever be time for the United States to negotiate with the Taliban?

ROMNEY: We don’t negotiate with terrorists. I do not negotiate with the Taliban. That’s something for the Afghans to decide how they’re gonna– pursue their course in the future. With regards to our footprint in Afghanistan, the right course is for us to do our very best to secure the victories that have been so hard won by the soldiers, the men and women of– of our– fighting forces who have been in Afghanistan.

The commanders on the field feel that we can take out 30,000 to 40,000 troops sometime by the end of next year. The commander in chief, perhaps looking at the calendar of the election, decided to bring them home in September, instead, in the middle of the fighting season. Our commanders said that puts our troops at risk, at danger, “Please don’t pull ’em out there,” they said.

But he said, “No, I’m gonna get ’em out early.” I think that was a mistake. Our surge troops should have been withdrawn by December of next year, not by December. And the timetable, by the end of 2014, is the right timetable for us to be completely withdrawn from Afghanistan, other than a small footprint of support forces.

PELLEY: Mr. Speaker, how do you achieve peace in Afghanistan if you don’t negotiate with the Taliban?

GINGRICH: I don’t think you do.

PELLEY: Would you agree that the Taliban–

GINGRICH: Look, I– I think this is so much bigger and deeper a problem than we’ve talked about as a country that we– we don’t have a clue how hard this is gonna be. First of all, the Taliban survives for the ex– the very same reason that historically we said guerillas always survive, which is they have a sanctuary. The sanctuary’s Pakistan. You’re never gonna stop the Taliban as long as they can sort of hide. And you– and you have proof every week in new bombings and new killings and new training. So I think this has to be a much larger strategic discussion that starts with, frankly, Pakistan on the one end and Iran on the other, because I– Afghanistan is in between the two countries and is the least important of the three countries.

GARRETT: Related to that, Mr. Cain, I’d like to pick up on a point that Speaker Gingrich just made. You have said about foreign policy, “America needs to be clear about who its friends are and who its foes are.” So this evening, sir, Pakistan, friend or foe?

CAIN: We don’t know. Because Pakistan– it’s not clear, because Pakistan is where Osama bin Laden was found and eliminated. Secondly, Pakistanis have a conversation with President Karzai from Afghanistan and they– and President Karzai has said that if the United States gets into a dispute with Pakistan, then Afghanistan’s gonna side with Pakistan. There is a lot of clarity missing, like Speaker Gingrich says, in this whole region. And they are all interrelated. So there isn’t a clear answer as to whether or not Pakistan is a friend or foe. That relationship must be reevaluated.

GARRETT: If you were president, sir, and your national security council asked you what questions you would want answered to find out a better answer to this very question, what would you tell ’em?

CAIN: I would ask them what commitment is Pakistan willing to make to assure the United States of America that they are a friend or of– or a foe. And be specific about that. Will they make commitments relative to the commitment of their military, if we have to make commitments? Are they willing to come to some regional– agreement about what we need to do? We need a regional strategy in that area of the world, such that all of our allies, wor– we work together in order to come up with those things that would be mutually beneficial to everyone. Those are the questions that need to be asked.

PELLEY: Governor Perry, why is Pakistan playing a double game, saying that it supports the United States one moment and then supporting terrorists who are killing American troops the next? What’s going on there?

PERRY: Listen, I– I think we’re havin’– an interesting conversation here, but the deeper one– that the speaker makes a reference to is the whole issue of– of foreign aid. And we need a president of the United States working with a Congress that sends a clear message to every country. It doesn’t make any difference whether it’s Pakistan or whether it’s Afghanistan or whether it’s India.

The foreign aid budget in my administration for every country is gonna start at zero dollars. Zero dollars. And then we’ll have a conversation. Then we’ll have a conversation in this country about whether or not a penny of our taxpayer dollar needs to go into those countries. And Pakistan is clearly sending us messages, Mitt. It’s clearly sending us messages that they– they don’t deserve our foreign aid that we’re getting, because they’re not bein’ honest with us. American soldiers’ lives are being put at jeopardy because of that country and the decisions that they’re make–and it’s time for us as a country to say no to foreign aid to countries that don’t support the United States of America.

PELLEY: That’s time, Governor. Governor, let me give you 30 seconds in the follow up to go back to the question, “Why is Pakistan playing this double game?” Help us understand-

PERRY: Look, they’ve been doing this–

PELLEY: –what’s going on there.

PERRY: They’ve been doing this for years. Their political people are not who are in charge of that country. It’s the military. It’s the secret service. That’s who’s running that country. And I don’t trust ’em. And we need to send clear messages. We need to do foreign aid completely different. I’m tellin’ you, no dollar’s goin’ into those countries. As a matter of fact, if they want any American aid, any country, unless we say differently, the American manufacturing, big companies, small companies, going in to help create economic–

PELLEY: And that’s–

PERRY: –impacts in those countries–

PELLEY: –time, Governor. Thank you.

PERRY: –rather than just dollars flowin’ into some administration.

PELLEY: Thank you very much.

GARRETT: Congresswoman Bachmann, you serve on the Intelligence Committee. I’d like to get your assessment of what you think is happening in Pakistan, especially with the Hikani Network. And you know from sitting on that committee that those in the diplomatic corps in this country and even the intelligence community believe that there is a tangible benefit, at times, to properly appri– apply foreign aid from this country. So I want to know if you agree with the governor on that question, starting at zero. And also your assessment of the intelligence situation in Pakistan, and what we should do about it.

BACHMANN: Pakistan is a very difficult area, because they have been housing terrorists and terrorists have been training there. Al Qaeda, as well as Hikani, as well as other militias dealing with terrorist organizations. But I would not agree with that assessment to pull all foreign aid from Pakistan. I would reduce foreign aid to many, many countries. But there’s a problem, because Pakistan has a nuclear weapon. We have more– people affiliated with Al Qaeda closer to that nuclear bomb than in any nation. This is an extremely important issue.

And I think it underscores exactly why the next commander in chief has to understand from day one the intricacies that are happening in the Middle East. This is a very dangerous time. If you look at Iran and if you look at Pakistan and if you look at– at the– the links with Syria, because Iran is working through proxies like Syria, through Hezbollah, through Hamas. It seems that the table is being set for worldwide nuclear war against Israel. And if there’s anything that we know, President Obama has been more than willing to stand with Occupy Wall Street, but he hasn’t been willing to stand with Israel. Israel looks at President Obama and they do not see a friend.

GARRETT: Congresswoman, thank you. Speaker Gingrich, you presided– as speaker over several foreign aid budgets for the United States. And I remember covering in 1995 the intervention on behalf of the Mexican peso. You have seen, at times, the proper role of the United States through foreign aid and other interventions. I want to know if you agree with– Governor Perry about starting at zero?

GINGRICH: I’m absolute– I mean, what he said made absolutely perfect sense. Why would you start every year– and consider the alternative. You’re giving some country $7 billion a year. So you start off– or– or in the case of Egypt, $3 billion a year. So you start off every year and say, “Here’s your $3 billion, now I’ll start thinking”? You ought to start off at zero and say, “Explain to me why I should give you a penny.”

And let me tell you, the fact that the Pakistanis– he didn’t think about this. The Pakistanis hid Bin Laden for at least six years in a military city within a mile of their national defense university? And then they got mad at the people who turned him over to us? And we think those are the acts of allies? I think that’s a pretty good idea to start at zero and sometimes stay there.

GARRETT: Just a quick follow up, Mr. Speaker. Since you’ve entered– since you mentioned Egypt, Mr. Speaker, I just want to know, if you were president, if the aid that we currently provide on an annualized basis to Egypt would be completely rethought and possibly eliminated, if you were president?

GINGRICH: It would certain– it would certainly be completely rethought. And candidly, the degree to which the Arab Spring may become an anti-Christian spring is something which bothers me a great deal. And I would certainly have the State Department intervening on behalf of the…[inaudible]…Christians, who are being persecuted under the new system, having their churches burned, having people killed. And I’d be pretty insistent that we are not gonna be supportive of a regime, which is explicitly hostile to– to religions other than Islam.

PELLEY: Senator Santorum– if a Pakistani nuclear weapon goes missing, what do you do?

SANTORUM: Well, let me just stop back and– and– and say I disagree with a lot of what was said up here. Pakistan must be a friend of the United States for the reason that Michele outlined. Pakistan is a nuclear power. And there are people in this– in that country that if they gain control of that country will create a situation equal to the situation that is now percolating in Iran.

So we can’t be indecisive about whether Pakistan is our friend. They must be our friend. And we much mut– we must engaged them as friends, get over the difficulties we have, as we did with Saudi Arabia, with– with respect to the events of 9/11. We– they– the terrorists came from Saudi Arabia. And we said, “What– you know what? It’s important for us to maintain that relationship, in spite of those difficulties.”

And it’s important for us, with a nuclear power, with a very vast number of people in Pakistan, who are radicalizing, that we keep a solid and stable relationship and work through our difficulties. It is that important, and we must maintain that relationship.

PELLEY: But the Pakistanis back a terrorist network, the Hikani Network, that laid siege to the NATO headquarters and the U.S. embassy in Kabul for 20 hours, a few weeks ago.

SANTORUM: And the Pakistanis–

PELLEY: How do you make friends out of Pakistan?

SANTORUM: A lot of the Pakistanis and most of the government would say they don’t back the Hikani Network and the Hikani Network causes as much trouble in Pakistan as it has caused us in– in Afghanistan. We need to work with the elements of Pakistan, and there are elements in the government of Pakistan and the military.

We need to continue those joint exercises. We need to continue the– the aid relationship. And of course, we all know the aid relationship, when it comes to military aid, is all spent in the United States. So it’s not giving money away, it’s– it’s– it’s sending military hardware, which creates jobs in this country, to those countries, creating nexus and relationships and dependency on our weapon systems that’s important for those future relationships.

PELLEY: Senator, we’ll have to leave it right there. We will have more of the Republican Commander in Chief Debate in just a moment.

[commercial break]

PELLEY: Welcome back to Spartanburg, South Carolina and the Republican commander in chief debate. I’m Scott Pelley with CBS News along with Major Garrett of National Journal.

GARRETT: Thanks again, Scott. Mis– Mr. Speaker, you said yesterday that Governor Romney is a competent manager. But you said you were unsure if he was really capable of changing Washington. You said you were the change agent. Based on the arc of this campaign and perhaps what you’ve heard tonight, would you care to evaluate Governor Romney’s ability to think outside the box and change United States national security or foreign policy perspectives.

GINGRICH: No.

GARRETT: You said so last night. Then what was the point, sir? Then what was the point, sir, of bringing it up yesterday on a national radio show?

GINGRICH: I brought it up yesterday ’cause I was on a national radio show. I think he brings up things when he’s on national radio shows. We’re here tonight talking to the American people about why every single one of us is better than Barack Obama. And that’s the topic [inaudible].

GARRETT: But, Mr. Speaker. If you– if you would like to–

GINGRICH: By– and by the way, compared– let me just say, compared to this administration, talking about a friend who’s a great business manager as a good manager is an enormous improvement over Barack Obama.

GARRETT: Then, Mr. Speaker, I well remember you talking as Speaker about the necessary– or the necessity of leaders to think outside the box.

GINGRICH: Yes.

GARRETT: If you were president, how would you think outside the box about some of the issues we’ve discussed here tonight?

GINGRICH: Well, in a number of ways. As I said earlier, I would– I would explicitly adopt the Reagan/John Paul II/ Thatcher strategy towards Iran. I would do the same thing towards North Korea. I would adopt a very strong policy towards the United Nations of– dramatically taken on its– its absurdities. I would explicitly repudiate what Obama’s done on Agenda 21 as the kind of interference from the United Nations that’s wrong.

There are a number of other areas. I would also, frankly, apply– Lean Six Sigma to the Pentagon to liberate the money to rebuild the na– we’re– we– we– we need a capital investment program. And this administration is shrinking the Navy to a point where it’s going to be incapable of its doing its job worldwide. So there are a number of places I would be thinking outside the box.

PELLEY: And that’s time, Mr. Speaker. Thank you very much. Mr. Cain, you’ve often said that you’ll listen to your generals for their advice before making decisions as commander in chief. How will you know when you should overrule your generals?

CAIN: The approach to makin’ a critical decision, first make sure that you surround yourself with the right people. And I feel that I’ll be able to make that assessment when we put together the cabinet and all of the people from the military, etcetera. You will know you’re makin’ the right decision when you consider all the facts and ask them for alternatives. It is up to the commander in chief to make that judgment call based upon all the facts.

And because I’ll have mult– a multiple group of people offering different recommendations, this gives me the best opportunity to select the one that makes the most amount of sense. But ultimately, it’s up to the commander in chief to make that decision.

GARRETT: Senator Santorum, this is really a question about how you build a leadership model. How, sir, would you decide when it was necessary for you as commander in chief to overrule the advice you get from either your civilian advisors or your military advisors?

SANTORUM: Well, I’ll come into– to the office of the presidency with a very clear agenda. And we’ll– I’ll get people together that will share my point of view. When I was in the United States Senate, I didn’t hire people who didn’t share how I approach the problem. That’s what the people of this country are electing. They’re electing someone who’s gonna be very crystal clear. And as you heard from my first two answers, I don’t mince words. I say exactly what I believe.

And then I follow through and do what I say. I did that when I was in public life before, even though I represented a state that wasn’t particularly conservative state. I followed through and did that. And I will surround myself with people who will execute what I promise the American public to do. And then we will go about the process of doing it.

PELLEY: You mentioned your agenda. If you could prioritize one or two points, maybe more if you’d like, what your key agenda is on national security.

SANTORUM: Well, obviously, the– the issue we were talking about before which is, number one, Iran must not get a nuclear weapon. And we will go about whatever it takes to make sure that happens. I hope, I hope that some of the things that I’ve talked about here and– and Newt’s– thing that I– I’ve been talking about for a while, which is covert activity.

You know, there have been scientists turning up dead in Russia and in– in Iran. There have been computer viruses. There have been problems at their facility. I hope that the United States has been involved with that. I hope that we have been doing everything we can covertly to make sure that that program doesn’t– proceed forward. And if we’re lucky enough, and I’m not sure we will be, that if– un– no action is taken and we still don’t have a nuclear Iran, that would be my laser beam focus, to make sure that would not happen.

PELLEY: And that’s time, Senator. Thank you very much. Governor Perry, you advocate the elimination of the Department of Energy. If you eliminate the Department of Energy–

PERRY: Glad you remembered it.

PELLEY: I’ve had some time to think about it, sir.

PERRY: Me too.

PELLEY: If you eliminate the Department of Energy, what do you do with the nuclear weapons?

PERRY: Well, there are plenty of places in our government that can have oversight on our– our nuclear energy. But let me back over to– the question that you’ve asked before this about what is the most important thing from a strategic standpoint, commander in chief. For ten years, I have been the commander in chief of over 20,000-plus individuals in the State of Texas as we’ve dealt with a host of either natural disasters or having deployments– into the combat zone. So, if there’s someone on this stage who has had that hands-on commander in chief experience, it is me, as the governor of the State of Texas.

I’ve ha– dealt with generals. I have individuals at the Department of Defense who have been at the highest levels both on the civilian side and on the military side that will help me make decisions about those issues that we face as a country. So, I feel very comfortable from day one of surrounding myself with individuals who have extraordinary backgrounds in national defense and will be able to put this country on a track that Americans will feel we know that we’re gonna be secure.

PELLEY: And that’s time, sir.

PERRY: Including the southern border of this country with Mexico.

PELLEY: And that’s time, thank you.

GARRETT: I don’t need to tell the people on this stage that presidential politics is interactive business. And, of course, this debate is interactive as well. And we have an email question I’m happy to say, emailed into the National Journal. And it comes from Stephen Schafroth of Odell’s, Oregon. And I’d like to address this question to Mr. Cain. Stephen writes, “I served on an aircraft carrier during the Vietnam War. I believe that torture is always wrong in all cases. What is your stance on torture?”

CAIN: I believe that following the procedures that have been established by our military, I do not agree with torture, period. However, I will trust the judgment of our military leaders to determine what is torture and what is not torture. That is the critical consideration.

GARRETT: Mr. Cain, of course you’re familiar with the long-running debate we’ve had about whether waterboarding constitutes torture or is an enhanced interrogation tech– technique. In the last campaign, Republican nominee John McCain and Barack Obama agreed that it was torture and should not be allowed legally and that the Army Field Manual should be the methodology used to interrogate enemy combatants. Do you agree with that or do you disagree, sir?

CAIN: I agree that it was an enhanced interrogation technique.

GARRETT: And then you would support it at present. You would return to that policy.

CAIN: Yes, I would return to that policy. I don’t see it as torture. I see it as an enhanced interrogation technique.

GARRETT: Congressman– congresswoman Bachmann, your opinion on this question that our emailer asked.

BACHMANN: If I were president, I would be willing to use waterboarding. I think it was very effective. It gained information for our country. And I– and I also would like to say that today, under Barack Obama, he is allowing the A.C.L.U. to run the C.I.A. You need to understand that today– today we– it– when we– when we interdict a terrorist on the battlefield, we have no jail for them.

We have nowhere to take them. We have no C.I.A. interrogations anymore. It is as though we have decided we want to lose in the War on Terror under President Obama. That’s not my strategy. My strategy will be that the United States will be victorious in the War on Terror.

GARRETT: Congressman Paul, my spidey sense tells me we have a debate about to get launched here. I know you have an opinion you’d like to weigh in.

PAUL: Yes. Tor– torture is illegal. And– by our laws. It’s illegal by international laws.

GARRETT: How do you– how do you define torture, sir?

PAUL: Well, waterboarding is torture. And– and many other– it’s ill– it’s illegal under international law and under our law. It’s also immoral. The– and it’s also very impractical. There’s no evidence that you really get reliable evidence. Why would you accept the position of torturing 100 people because you know one person might have information? And that’s what you do when you accept the principal of a– of– of– of torture. I think it’s– I think it’s uncivilized and prac– and has no practical advantages and is really un-American to accept on principal that we will torture people that we capture.

GARRETT: And that’s time, thank–

BACHMANN: Major– Major, I have to bring it up. I have to say–

PELLEY: Give– you know, let’s– let’s allow–

BACHMANN: I– I– I have– I have to say something on this, Major.

PELLEY: –let’s– I’m sorry, Congresswoman, just a moment if you would, please.

BACHMANN: I– I– I–

PELLEY: Let’s give– let’s give– Governor Huntsman an opportunity to take 30 seconds on that question.

HUNTSMAN: Thank you. Gets a little lonely over here in Siberia.

SANTORUM: Tell me about it.

HUNTSMAN: First of all, let me thank the sailor on the ship. I have two boys in the United States Navy. And all they wanna do is go on to fight, protect, and defend the great freedoms that we share in this country. This country has values. We have a name brand in the world. I’ve lived overseas four times. I’ve been an ambassador for my country three times. I’ve lived overseas and done business.

We diminish our standing in the world and the values that we project which include liberty, democracy, human rights, and open markets when we torture. We should not torture. Waterboarding is torture. We dilute ourselves down like a whole lot of other countries. And we lose that ability to project values that a lot of people in corners of this world are still relying on the United States to stand up for them.

PELLEY: And that is time. Thank you, sir. Governor Romney. Governor Romney, recently President Obama ordered the death of an American citizen who was suspected of terrorist activity overseas. Is it appropriate for the American president on the president’s say-so alone to order the death of an American citizen suspected of terrorism?

ROMNEY: Absolutely. In this case, this is an individual who had aligned himself with a– with a group that had declared war on the United States of America. And– and if there’s someone that’s gonna– join with a group like Al-Qaeda that declares war on America and we’re in a– in a– a war with that entity, then of course anyone who was bearing arms for that entity is fair game for the United States of America. Let me go back– let me go back and just– and just talk for a moment about the issue that the issue that a number of people have spoken about which is their definition of how their foreign policy might be different than this president.

My foreign policy’s pretty straightforward. I would be guided by an overwhelming conviction that this century must be an American century where America has the strongest values, the strongest economy, and the strongest military. An American century means the century where America leads the free world and the free world leads the entire world.

We have a president right now who thinks America’s just another nation. America is an exceptional nation. We have a president who thinks that the way to conduct foreign policy is through his personal affects on other people. I’m– I believe the way to conduct foreign policy is with American strength. Everything I do will make America stronger. And I will stand and use whatever means necessary within the law to make sure that we protect America’s citizens and Americans’ rights.

PELLEY: And– and that’s time, Governor. Lady– ladies and gentlemen, — ladies and gentlemen, the applause are lovely. But we will not have doing. Thank you very much. We’ll have– we’ll have courtesy for all of the candidates on the stage. Speaker Gingrich, if I could just ask you the same question, as President of the United States, would you sign that death warrant for an American citizen overseas who you believe is a terrorist suspect?

GINGRICH: Well, he’s not a terrorist suspect. He’s a person who was found guilty under review of actively seeking the death of Americans.

PELLEY: Not– not found guilty by a court, sir.

GINGRICH: He was found guilty by a panel that looked at it and reported to the president.

PELLEY: Well, that’s ex-judicial. That’s– it’s not–

GINGRICH: Let me– let me– let me tell you a story– let me just tell you this.

PELLEY: –the rule of law.

GINGRICH: It is the rule of law. That is explicitly false. It is the rule of law.

PELLEY: No.

GINGRICH: If you engage in war against the United States, you are an enemy combatant. You have none of the civil liberties of the United States. You cannot go to court. Let me be– let me be very clear about this. There are two levels. There’s a huge gap here that– that frankly far too many people get confused over. Civil defense, criminal defense, is a function of being within the American law. Waging war on the United States is outside criminal law. It is an act of war and should be dealt with as an act of war. And the correct thing in an act of war is to kill people who are trying to kill you.

Male Voice: Well said. Well said.

GARRETT: Governor Perry, if you’ll indulge, then, sir, I’d like to change the subject a little bit to China. According to U.S. officials, China is using cyber-attacks to steal billions of dollars of intellectual property that is critical to this nation’s economic success. Are we, sir, engaged in financial warfare with China?

PERRY: Listen, there are some people who have made the statement that– the 21st century is gonna be the– the century of China and that, you know, we’ve had our time in the sunshine. I don’t believe that. I don’t believe that at all. As a matter of fact, you think back to the 1980s and we faced a similar type of– of a situation with– with Russia.

And Ronald Reagan said that Russia would end up on the ash heap of history. And he was right. Mitt, I happen to think that the communist Chinese government will end up on the ash heap of history if they do not change their virtues. It is important for a country to have virtues, virtues of honest.

And this whole issue of allowing cyber security to go on, we need to use all of our resources– the private sector working along with our government, to really b– standing up the cyber command in 2010 was a good start on that. But fighting this cyber war, I would suggest, is one of the great issues that will face the next President of the United States. And we must went–

PELLEY: Governor, thank you, that’s time. Governor Romney, I wonder, how would you manage China to avoid a 21st century Cold War?

ROMNEY: Well, China has an interest in trade. China wants to– as they have 20 million people coming out of the farms and coming into the cities every year, they want to be able to put them to work. They wanna have access to global markets. And so we have right now sumthin’ they need very badly, which is access to our market and our friends around the world, have that same– power over China. We– to make sure that we let them understand that in order for them to continue to have free and open access to the thing they want so badly, our markets, they have to play by the rules.

They can’t hack into our computer systems and steal from our government. They can’t steal from corporations. They can’t take patents and designs, intellectual property, and– and– and– and duplicate them– and duplicate them and counterfeit them and sell them around the world. And they also can’t manipulate their currency in such a way as to make their prices well below what they otherwise would be.

We have to have China understand that like everybody else on the world stage, they have to play by the rules. And if they do, we’ll have open trade with them and work with them. And they should in every way want to collaborate with us and not become a belligerent nation economically or militarily. But if you just continue to sit back and let them run over us– the policies of Barack Obama in China have allowed China to continue to expand their– their– entry into our computer systems, their entry–

PELLEY: And–

ROMNEY: –stealing our intellectual property.

PELLEY: That’s time, Governor, but I’ll–

ROMNEY: And of course, their mil– their military capacity.

PELLEY: That’s time, Governor. But I would like to ask you a follow-up on that point. You– you talked about all the things that China should be doing. How do you affect that as commander in chief? How do you make China do these things?

ROMNEY: Well number one, on day one, it’s acknowledging something which everyone knows, they’re a currency manipulator. And on that basis, we also go before the W.T.– the W.T.O. and bring an action against them as a currency manipulator. And that allows us to apply, selectively, tariffs where we believe they are stealing our intellectual property, hacking into our computers, or artificially lowering their prices and killing American jobs. We can’t just sit back and let China run all over us. People say, “Well, you’ll start a trade war.” There’s one goin’ on right now, folks. They’re stealing our jobs. And we’re gonna stand up to China.

GARRETT: Governor Huntsman, Governor Romney just said we’re in the middle of a war that’s– we’re not even declared or we’re not even aware of. And Governor Perry said China will end up on the ash heap of history. You’ve been in China. You were the ambassador for our nation there under President Obama. What’s your reaction?

HUNTSMAN: Well, the re– reality’s a little different as it usually is when you’re on the ground. And I’ve tried to figure this out for 30 years of my career. First of all, I don’t think, Mitt, you can take– China to the W.T.O. on currency-related issues. Second, I– I don’t know that this country needs a trade war with China. Who does it hurt? Our small businesses in South Carolina, our exporters– our agriculture producers.

We don’t need that at a time when China is about to embark on a generational position. So what should we be doing? We should be reaching out to our allies and constituencies within China. They’re called the young people. They’re called the internet generation. There are 500 million internet users in China.

PELLEY: And Governor, we’re going to have to–

HUNTSMAN: And 80 million bloggers. And they are bringing about change, the likes of which is gonna take China down.

PELLEY: We’re gonna have to leave it there, Governor.

HUNTSMAN: While we have an opportunity to go up and win back our economic–

PELLEY: Governor–

HUNTSMAN: –manufacturing muscles. That’s all I wanna do as president.

PELLEY: That’s time. I thank you very much. We will be back with the Republican commander in chief debate from Wofford College in just a moment.

[pause]

PELLEY: Welcome back to South Carolina and the Republican commander in chief debate. Governor Perry, we just got a– question via Twitter from Barbara McMann. And Barbara asked this question of you. “Does Governor Perry’s Foreign Aid Starts at Zero include Israel?”

Rick Perry: Well, as Governor Perry– would tweet back to her that– absolutely. Every country would start at zero. Obviously, Israel is a special ally. And my bet is that we would be funding them– at some substantial level. But it makes sense for everyone to come in at zero and make your case. As a matter of fact, we oughta try that– doin’ that with some of those agencies that I was tryin’ to think the name of the other night.

Starting at zero, zero-based budgeting, and Newt will share with you, is we’ve gotta go there. And everyone has to come in and make your case. It’s what the American people are doin’. There’s somebody at home sittin’ watchin’ T.V. tonight, lookin’ for a job. And they’re havin’ to budget. Why in the world would our federal government get a pass on sending our tax dollars to any country–

PELLEY: And, Governor, I have to s–

PERRY: –without havin’ an answer? Why?

PELLEY: We’re gonna have to leave it right there. I thank you very much. That brings us to the end of the first hour of the debate. Some CBS stations will be leaving us. But you can continue to follow the debate online on CBSNews.com and NationalJournal.com. And you can submit questions for the candidates at either of those sites. Most of our stations in South Carolina and on the west coast will continue to broadcast the debate. When we return, we will take questions from South Carolina’s two senators, s– United States Senator Lindsey Graham and Senator Jim DeMint. With thanks to the candidates, thanks to Wofford College, thanks to the G.O.P. and South Carolina, I’m Scott Pelley with Major Garrett.

PELLEY: Good evening from Wofford College in Spartanburg, South Carolina. This is the Republican Commander in Chief debate. I’m Scott Pelley with CBS News, along with Major Garrett of National Journal. This is the final half hour of this 90 minute Republican debate. The focus tonight: National security and foreign affairs.

And in this half hour, we’ll include your questions. You may submit them on-line at CBSNews.com and NationalJournal.com. And we will have the questions of South Carolina senators Lindsey Graham and Jim Demint. So let’s continue.

GARRETT: Indeed, Scott. We have a question from Josh Cooper from Woodsboro, Massachusetts. Congresswoman Bachmann, he writes in as this debate was going on. Quote: “Almost half of the federal budget goes to military-related expenditures. Should we increase spending, especially in a debt crisis?

BACHMANN: Well– the military is also able to– to have expenditures reduced, as well. And I think probably the best place is in the area of how we finance procurements. Today, we have a situation where we reward those who are designing and– and– and– making our weaponry, based upon the length of time that they take it– to produce it. We don’t do that anywhere else.

So rather than having a cost plus fee, we need to have a fixed cost system. We’ll save money. And also, tri-care could use reform, as well. Those are two areas where we’d yield significant savings. That– but we cannot do is cut back on the efforts regarding our troops and making sure they’re fully resourced.

GARRETT: A quick follow-up, Congresswoman. Can you name a weapon system that you think should be ended for fiscal reasons? And when you talk about tri-care, that’s the military medical system. What do you mean when you say, “Reform,” does that mean cuts in benefits?

BACHMANN: No. I think that we need to have modernization. That’s what the biggest problem is right now with– with Social Security, with Medicare, with Medicaid. We’re continuing to abide by the models that we had when they were first originated. There’s very few businesses that maintain their similar business practices 45 years after inception or 75 years after inception. We have to modernize.

But we also know what the future is in health care, don’t we? It is Obama Care. And quite likely, Tri-care, Medicare, all of these will collapse under President Obama, and everyone will be put into Obama Care. No one want to be– in Obama Care.

PELLEY: And that’s time–

BACHMANN: That’s why it’s Commander in Chief.

PELLEY: –Congresswoman.

BACHMANN: I’ll repeal Obama Care.

PELLEY: Thank you very much. Mr. Cain — Mr. Cain, would you describe what you think is happening in the Arab Spring? And how, as president, can you affect that to make it work for the United States and not against us?

CAIN: What’s happening in the Arab– Spring, you have to look at Libya, Egypt, Yemen, and all of the revolutions that are going on, and how this administration has mishandled them. As a result, they have gotten totally out of hand. Our relationship with Egypt may not survive.

Because when this president backed the opposition, it turned out that opposition was more of the Muslim Brotherhood, which could end up with a majority of control of this new government. This president has already said that the president of Yemen should go. He is our friend. He has been helping us to fight al-Qaeda. This president has been on the wrong side in nearly every situation in the Arab world, which has basically done nothing except to put that entire thing at risk.

PELLEY: And that’s time, sir, thank you.

GARRETT: Mr. Speaker, at least 3,500 civilians have been slaughtered in Syria. Today, the Arab League voted to suspect Syria. If the opposition, and you were commander in chief, requested military assistance, covert smuggling, or a no-fly zone, would you authorize either or both?

GINGRICH: With first of all, I think that it’s a good thing today that the Arab League suspended Syria. I think this administration should have been much more aggressive against Assad. It’s ironic to me that Mubarrak, who had been our ally for years, who had done everything he could to help the United States, who had helped us in the Iraq campaigns, who had done literally we had requested of him, he was dumped overnight by this administration in a way that signaled everybody in the world, “Don’t rely on the United States, because they’ll abandon you in a heartbeat if they feel like it.”

Assad, who is our enemy, and is an ally and– of– of– of Iran, has had amazingly soft treatment by our State Department, as though they are afraid to make him feel bad. I would actively– approve– taking those steps would which– defeat his regime, which would probably be mostly covert. I don’t– I don’t think you need a no-fly zone. I think there are a number of steps you could take. And I think he would fall very rapidly.

If– the– if the United States and Europe communicated clearly that Assad was going to go, I think you would find Europe– there’s a very tiny faction. And I think you would find him likely to be replaced very rapidly.

GARRETT: Congressman Paul, covert operations in Syria?

PAUL: I think–

GARRETT: A green light for you?

PAUL: I think it would– be a mistake. I think the Syrians oughta deal with their country. I think we should have dealt–

GARRETT: But what about the– what about the 3,500 dead?

PAUL: Well, there– there’s been a lot of people killed throughout the world in the last century. You know, the Soviets and the Chinese killed hundreds of millions. But we didn’t feel compelled morally to try to stop it. No. It’s a tragedy. And it would be nice if they would accept different views.

But for us to get in the middle of that and prop up the different dictatorships, this is why we get into this trouble. It’s overthrowin’ dictatorships that we have supported that causes so much of this problem. So to get further involved, you– want to have self determination. We don’t need to lose anymore troops. You get in there with covert operations. And you have troops involved. And–

GARRETT: Thank you, Congressman.

PAUL: It’s– very costly.

PELLEY: Thank you, Congressman.

PAUL: It’s not a good idea.

PELLEY: Governor Romney– Governor Romney, if I may ask you a 30 second follow-up to that. Is it time for the Assad dictatorship to end? Would you use mili– tel– military force to do that?

ROMNEY: Of course it’s time for the Assad dictatorship to end. And we should use covert activity, as Speaker Gingrich has just indicated. Look– the– the reason I disagree with Ron Paul on this is– that you have, in Syria, a nation which is an ally, the only Arab ally, of Iran. It is arming Hezbollah. It represents a– an access– of– of great significance to Iran. And as a result, because of our concern about Iran, and their effort to become the Hageman in the Middle East, it is important for– for us as a nation to stand up and to help those efforts to– to replace A– Assad. And that means helping Turkey and– and– Saudi Arabia, who are putting pressure on him, as well as covert activity of our own.

PELLEY: Governor, thank you very much. Now, as a unusual feature of this particular debate, we have with us tonight the two United States senators from South Carolina, who have questions for the Republican candidates. And they will ask the question, but the moderators will direct the question to the appropriate candidates. And we’re going to start with the senior senator, Lindsay Graham. Senator Graham, thank you for being with us here tonight.

Senator Lindsay Graham: Thank you. A comment first. Thank you all for running for president. I’m proud of each and every one of you. Thank you very much. Three-part question. I hope I can remember all three parts. Within days of taking office, President Obama, by executive order, stopped the CIA from using classified enhanced interrogation techniques that are not water-boarding. There’s a presumption that every person at Gitmo, under the Obama administration, should go into civilian court, not military commission. And the Obama administration recently said that any future captors in the war on terror would not go to Gitmo. Would you continue these policies? If you would change them, why?

PELLEY: And Mr. Cain, that first question will go to you.

CAIN: I absolutely would reverse all three of those policies. I’d keep Gitmo– Gitmo open. I would definitely allow the military to use enhanced interrogation techniques, because they’re terrorists. They are terrorists. Pampering terrorists isn’t something that we ought to do. So I anybody would reverse all three of those things that you indicated.

PELLEY: Senator Santorum, you have one minute on the same question.

SANTORUM: Oh, I would agree with– with– with– with– Herman Cain. The– Gitmo is– is essential to– to leave open. We have to use enhanced interrogation techniques, all enhanced inger– interrogation techniques. It has been proven to be successful in gathering information. It was critl– critical for us– in the– in the war against terror. And we need to continue that– that operation.

And using civilian courts– is a– is– is one of the worst ideas I have ever heard. The– civilian courts are given to people who have rights under our constitution. People who have attacked our country and are foreign combatants ha– do not have those rights. Our country stands for freedom. Our country stands for all of those proper ideals.

But when– and we– and we stand with the Geneva Convention. But when people fight outside of those con– there’s a convention there for a reason. It’s to get people to play by the rules. And when they don’t play by the rules, they should not given– be given the benefit of those that do. And that’s why we have Gitmo and these techniques.

PELLEY: Congressman Paul, one minute to you, sir.

PAUL: I think that– this is a mess. It’s a mess because we have a bad foreign policy. We’re pretending we’re at war. We haven’t declared the war, but we’re at war against a tactic. And therefore– there’s no limits to it. So we create these monstrosities. And we do think outside the law. We come up with assassination, allowing the president to decide who’s going to be assassinated?

And– lo and behold, three Americans now have been on the list. They’ve been assassinated. But they don’t talk about the second one, because the second one happened to be a 16 year old son of Awlaki. So what are we doing here to accept this idea that our president, and this lawlessness, to pursue? And that– we some day will be subject to those same courts.

So no, you don’t. You want to live within– in the law and obey the law. Because– otherwise, it’s going to be very bad for all– all of us. And– this whole idea that– now we can be assassinated by somebody that we don’t even like to run our medical care, and giving this power to the president to be the prosecutor, the executor, the judge and the jury, we better look at that carefully before you automatically endorse something like that.

PELLEY: Congressman, thank you very much.

BACHMANN: Could I– could interject something?

PELLEY: Governor, I’m– I’m–

BACHMANN: Can I interject and say something?

PELLEY: I’m sorry, there– there’s a– there’s actually a system at work here with regard to the Senator’s question. So if I may, Governor Perry, you have one minute for Senator Graham’s question.

PERRY: Yeah. Let me just address Congressman Paul. And I– Congressman, I– I respect that you wore the uniform of our country. But– in 1972, I volunteered to serve the United States Air Force. And the idea that we have our young men and women in combat today, Senator, where there are people who would kill them in a heartbeat, under any circumstance, use any technique that they can, for us not to have the ability to try to extract information from them, to save our young people’s lives, is a travesty. This is war. That’s what happens in war. And I am for using the techniques, not torture, but using those techniques that we know will extract the information to save young American lives. And I will be for it until I die.

PELLEY: Thank you, Governor. Representative Bach– Bachmann, let me give you 30 seconds to pick up on that.

BACHMANN: Thank you. Yeah, I– I’d like to respond to Ron Paul and his comments. Because the people that the president of the United States gave orders to kill include Osama bin Laden. Now I think all of us can agree this is a good idea for the president of United States to make this decision. Ron Paul doesn’t think so.

But this is a very good idea for the president. After all, Osama bin Laden had no problem ordering the destruction of the wor– of the– of the Twin Towers or of the Pentagon. That resulted in over 3,000 lives. As well– Awlaki, who we also killed, he has been the chief recruiter of terrorists, including Major Hassan at Fort Hood, including the underwear bomber over Detroit, and including the Times Square bomber. These were very good decisions that were made to take them out.

GARRETT: Congresswoman, thank you. I know, Ron Paul, you want to jump in.

PAUL: Yes.

GARRETT: Please.

PAUL: I voted for the authority to go after bin Laden. I was upset because it took ten years because we– we were diverted from– going after him and doing the job. But that’s a lot different than assassinating American citizens. I mean he– he wasn’t a citizen.

But I do wanna remind you that over 300 individuals were tried in civilian courts here that were charged with terrorism here. Most of ’em are in jail. And I don’t think we should give up so easily on our rule of law.

PELLEY: Congressman Paul, thank you very much.

GARRETT: It’s time to call on Senator Jim Demint from South Carolina. Sir, you have a question, and I will direct it to the four who were not called on the first time. So Senator, please.

Jim Demint: Thank you. And thank you all for being in South Carolina tonight. Federal spending and debt are not only our greatest economic problems, they’re our largest national security problem. Yet the president and the Congress continue to spend and borrow at record levels. Just adjusting the spending on existing federal programs will not solve the problem. What federal functions will you eliminate or return to the states in order to balance our budget?

GARRETT: Governor Romney, to you, sir.

ROMNEY: Absolutely. Right now, we’re spending about 25 percent of the economy at the federal level. And that has to be brought down to a cap of 20 percent. I’ll get that done within my first term, if I’m lucky enough to get elected. How do you do that?

One, it’s eliminating programs. A lot of programs we like, but we simply can’t afford. The first we will eliminate, however, we’re happy to get rid of. That’s Obama Care. And that’ll save us $95 billion a year by my fourth year.

Other programs we like: the Endowment for the– for Humanities, the National Endowment for– for the Arts– Public Broadcasting. These are wonderful– features that we– we have of the government. But we simply can’t go out and borrow money from China to pay for them. They’re not that essential.

In terms of returning programs to the states: Medicaid, a program for the poor, should be returned to the states. Let the states manage it. And if we grow it, at inflation plus one percent, we’ll save $100 billion a year by returning that to the states. And finally, we have to make the federal government more productive. It is just way too over– over-burdened with– with excessive personnel. I’ll reduce the personnel by at least ten percent, and link the pay of federal employees with the pay in the private sector. We should not pay government workers more than the people–

GARRETT: Governor Romney, that’s time.

ROMNEY: –of America were paying for it.

GARRETT: Governor Romney, that’s time. Governor Huntsman, please– address Senator Demint’s question, if you would, sir.

HUNTSMAN: Thank you, Senator Demint. It’s an honor to be with you in your state– as– as it is– many other great leaders of South Carolina. I think it’s absolutely appropriate that– Admiral Mullen would say that our most significant national security threat is right here at home. And it’s our debt. I completely buy into that.

And if we’re gonna get this nation moving in the right direction, we need to recognize that debt, as 70 percent of our GDP and moving up, becomes a national security problem. You look where Japan is, well over 100 percent debt to GDP. Greece, 170 percent– to GDP. Italy, 120 percent.

So you get a sense of where our tomorrow is if we don’t tackle the debt and spending. My speech was a very short one on debt and spending. It’s three words: The Ryan Plan. I think The Ryan Plan sets out a template that puts– everything on the table. Medicaid– like– Governor Romney, I’d send back to the states. Education, I wanna move closer to the states. You move education closer to the decision makers, the school boards, the families, you’re a whole lot better off.

And I think there are some economic development functions, as well, legitimately that you can move closer to the state. But we’ve got to get our spending closer to 19 percent– of our GDP as opposed to this unsustainable 24, 25 percent.

GARRETT: Governor Huntsman, thank you very much.

HUNTSMAN: But we shipwreck the next generation.

GARRETT: Mr. Speaker, would you please direct Senator Demint’s question?

GINGRICH: Sure. I think actually, Senator, that there are four interlocking national security problems. Debt and the deficit’s one. Energy is a second one. Manufacturing is a third one. And science and technology’s a fourth. And you need to have solutions that fit all four.

I mean the thing that most worries me about this super committee is that they– they– they fail to understand that innovation and growth have to be at the heart of what we’re doing. Example: we should have a training requirement for all unemployment compensation so nobody gets money for doing nothing. Now, that saves money, but it simultaneously enhances the human capital of the United States and makes us more competitive in dealing with China.

We should be opening up offshore so that folks are able to– deal directly with, for example, $29 billion of natural gas here. In that process, you take some of the royalties and modernizes the Charleston Port, which you need for jobs here. I’m just trying to walk you through a way of thinking.

I helped balance the budget for four consecutive years. I’m not very concerned, if we’re serious, what you wanna do is fundamentally reform and overhaul the federal government, fundamentally. While, at the same time, accelerating economic growth to bring unemployment down to four percent. That combination gets you back to a balanced budget.

GARRETT: Mr. Speaker, thank you very much. Congresswoman Bachmann, please address Senator Demint’s question, what programs would you cut, how would you bring it down, the debt?

BACHMANN: I wanna thank you for as– asking that question, because that really is the number one issue that’s facing the country. We are in a terrible debt spiral, so much so that, just in the month of October, we just added another $203 billion in debt. And when you consider the last time that Republicans controlled the budget, it was nin– 2007, and the debt was $160 billion for the year. This was $203 billion just for the month of October.

For every man, woman and child in the United States, that means each one of us just took on another $650 in debt just for the month of October. That’s the velocity that we’re growing this debt. So what would I cut? I think, really, what I would wanna do is be able to go back and take a look at Lyndon Baines Johnson’s The Great Society.

The Great Society has not worked, and it’s put us into the modern welfare state. If you look at China, they don’t have food stamps. If you look at China, they’re in a very different situ– they save for their own retirement security. They don’t have pay FDC. They don’t have the modern welfare state. And China’s growing. And so what I would do is look at the programs that LBJ gave us with The Great Society, and they’d be gone.

PELLEY: Thank you, Congresswoman. Thank you very much. Mr. Cain– U.S. forces are coming under attack daily now from the enemy crossing over the border from Pakistan. As president, as commander in chief, would you order U.S. forces into Pakistan to clear out those safe havens of the enemy?

CAIN: That is a decision that I would make after consulting with the commanders on the ground, our intelligence sources, after having discussions with Pakistan, discussions with Afghanistan. And here’s why. We pointed out earlier that it is unclear as to where we stand with Pakistan. It is unclear where we stand with Afghanistan.

We have our young men and women dying over there. And for that president to say that they would side with Pakistan, that is a problem. This is why we have to tread lightly and get all the information. Because Pakistan is one of the nine nations that has a nuclear weapon. So before I say we would do that, there’s a lot of information that would need to be gathered.

PELLEY: Well, we’ve been at war in Afghanistan for ten years, of course. And– what is it about it that’s unclear to you at this point? 30 seconds.

CAIN: Well, what’s unclear is, when the president approved the surge, and then prematurely start pullin’ troops back, that wasn’t a good strategy. Victory is not clearly defined. As president, I will make sure that the mission is clear, and the definition of victory’s clear. And that simply does not exist right now.

PELLEY: Governor Romney, would you send American troops across the border into Pakistan to clear out those save havens? American men and women are coming under fire from those locations every single day.

ROMNEY: The right way to deal with– Pakistan is to recognize that Pakistan is not a country like other countries, with a strong political center that you can go to and say, “Gee, can we come here? Will you take care of this problem?” This is, instead, a– nation which is close to being a failed state. I hope it doesn’t reach that point, but it’s a very fragile nation.

It really has four centers of power: the ISI, which is their– their intelligence services, the military, separate group. You have the political structure, and of course, the fundamentalists. And so we have to work with our friends in that country to get them to do some of the things we can’t do ourselves.

Bringing our troops into Pakistan and announcing at a stage like this that, as president, we would throw American troops into Pakistan, could be highly incendiary in a setting like that. Right now, they’re comfortable with our using drones to go after the people that are– that are representing a gr– the greatest threat.

PELLEY: We have time, governor. But are the Pakistanis–comfortable with our using drones?

ROMNEY: We have agreement with the people that we need to have agreement with to be able to use drones to strike at the people that represent a threat. And one of the things we have to do with our foreign aid commitments, the ongoing foreign aid commitments, I agree with Governor Perry. You start everything at zero.

But one of the things we have to do is have understanding with the various power bases within the country that they’re gonna have to allow us, or they themselves go after the Taliban and Haqqani net– network to make sure they do not destabilize Afghanistan, particularly as we’re pulling our troops out.

GARRETT: Senator Santorum, this week, National Journal and The Atlantic magazine reported that, for various reasons, some related to paranoia in Pakistan about what United States might do, they are moving operational nuclear weapons in that country, unguarded, in trucks. If you were commander in chief, and intelligence came to you that one of those nuclear weapons was lost or possibly in the hands of terrorists, how would you respond?

SANTORUM: Well, you’d have to respond with working with the Pakistani government and those who would fee they’re– as much threatened by that as– as we are. And– Mitt is absolutely right– there are v– various elements within the country– that are very hard to– to– to deal with. You have a radical element.

I would hope– that we’re talking about a situation where the military is– is– is– is somehow in control of that, and that we would have an element of the military that would be a problem. I would work with the military, I’d work with ISI, and get to– where we could secure that weapons. Obviously would not– you have to take some action. But it would depend on the circumstances. It’s sort of a hypothetical. Without having the knowledge of how it happened, it would hard to be answer the question.

GARRETT: That article also made clear that special operations forces are being trained for this very eventuality. Is that something you would consider as commander in chief, deploying special forces to isolated, find that nuclear weapon, and, if necessary, take it over?

SANTORUM: I would be working with the intelligence community within Pakistan. Again, it’s a compromised community. I understand there– there are relationship with ISI, with the Haqqani Network. Again, depending on the circumstances that we’re dealing with here– it– you would hope you would be able to work with the– with the intelligence community and work, if necessary, in support– in a support nature, whether it’s– with– human intelligence or– or– other types of surveillance, and potentially with the special forces– on the ground.

But again, this is clear. This is not one– you don’t cowboy this one. You don’t fly in to Afghanistan– I mean excuse me, to Pakistan and try to interdict a nuclear weapon. You’ve gotta work with the people in the– in power in the government to– to make sure that that accomplish–

GARRETT: Speaker Gingrich, 30 seconds, your thoughts on this scenario?

GINGRICH: Well, look. This is a good example of the mess we’ve gotten ourselves into since the Church Committee so-called reforms in 1970s. We don’t have a reliable intelligence service. We don’t have independent intelligence in places like Pakistan. We rely on our supposed friends for intelligence. They may or may not be our friends. And the amount of information we might or might not have might or might not be reliable.

This is a very good example of scenarios people oughta look at seriously and say, “We had better overhaul everything from rules of engagement to how we run the intelligence community, because we– are in a very dangerous world.”

PELLEY: Governor Huntsman– as we sit here, there is a crisis in Europe over debt, particularly in Italy and in Greece. And there is the threat of contagion onto Wall Street and U.S. banks. How do you prevent the Euro crisis from becoming a problem in the United States?

HUNTSMAN: The– lemme just– on Pakistan for one second. Because it’s pretty clear. There’s one man in charge in Pakistan. I’ve negotiated with the Pakistanis before, both in government and in business. They’re a tough bunch. General Giani’s in charge. He’s head of the military, which is head of I– ISI. It isn’t President Zardari, make no mistake about that. And I’d say you don’t have a choice.

Then I would pick up the phone and call Special Operations Command in Tampa and say, “I’ve got a job for SEAL– SEAL team number six. Prepare to move.” You don’t have a choice. When you have a loose nuke, you have no choice. And we have to take charge. That’s called leadership, and that’s what I would do as president.

With– with respect to Europe, we have two problems. One, Europe is our second largest export market. $240 billion we export to Europe every year, second only to Canada, $250 billion a year. As– if Europe goes down, as a metastases spreads, they’re gonna buy less. And we’re gonna lose jobs unless we can find other markets– as those exports begin to diminish. That’s gonna be problem number one, and we need to prepare for that.

Number two, it’s gonna spread throughout the banking system to the point where it’s gonna hit us and the United States. And with banks that are too big to fail in this country, we’re in deep trouble.

PELLEY: And– and that–

HUNTSMAN: Deep trouble.

PELLEY: –is time. Thank you very much. We just have time for a quick follow-up on– on that same question. Let me come to Governor Perry. How do you prevent the European crisis from become a problem on Wall Street?

PERRY: Well, the French and the Germans have the economic wherewithal to deal with this. They have the economy. You– when you think about the Euro and when it was established, it was done to be a competitor to the American dollar. They knew what they were doing. And now they find themselves with their overspending and– and– the sovereign debt being built up. And–

PELLEY: Governor, I’m sorry, but it’s the tyranny of the clock. We are all out of time. This is Scott Pelley with Major Garrett at the Republican–

UNKNOWN: We’ll allow the French and the Germans–

PELLEY: –debates. Thank you for joining us. Great to be with you.

November 9, 2011: CNBC / Michigan Republican Party Republican Presidential Debate Transcript

Republican Candidates Debate in Rochester, Michigan November 9, 2011

PARTICIPANTS:
Representative Michele Bachmann (MN);
Herman Cain (GA);
Former Speaker of the House Newt Gingrich (GA);
Former Governor Jon Huntsman (UT);
Representative Ron Paul (TX);
Governor Rick Perry (TX);
Former Governor Mitt Romney (MA); and
Former Senator Rick Santorum (PA)

MODERATORS:
Maria Bartiromo (CNBC);
John Harwood (CNBC)

BARTIROMO: And good evening, everyone. I’m Maria Bartiromo.

HARWOOD: I’m John Hardwood.

And welcome to CNBC’s Republican Presidential Debate. [applause]

CNBC’s “Your Money, Your Vote: The Republican Presidential Debate” Live from Oakland University in Rochester, MI …

BARTIROMO: Tonight, we are here in the great state of Michigan for a debate that will focus almost exclusively on the economy and how to fix the financial problems of our country.

On the stage tonight from left to right: Senator Rick Santorum. [applause]

BARTIROMO: Congresswoman Michele Bachmann. [applause]

Speaker Newt Gingrich. [applause]

Governor Mitt Romney. [applause]

Mr. Herman Cain. [applause]

Governor Rick Perry. [applause]

Congressman Ron Paul. [applause]

And Governor Jon Huntsman. [applause]

HARWOOD: The candidates will have 60 seconds to respond to questions, 30 seconds for follow-ups and rebuttals. Those will be at the discretion of the moderators.

We also want you, the candidates, to help us out a little bit, by answering the questions as directly and specifically as you can. I know you want to. You have proven that. But just in case you get off topic, maybe by accident, we may have to interrupt you.

BARTIROMO: Throughout the evening tonight we will be joined by an all-star lineup of the smartest people on CNBC.

First up tonight, Jim Cramer, the host of “Mad Money.”

Jim, welcome.

CRAMER: Thank you, Maria. [applause]

HARWOOD: And we also want to hear your voice. Go to our Web site, Debate.CNBC.com, and tweet us at CNBCDebate.

All night we’ll be showing your tweets on the bottom of the screen, so all of the candidates will have even more of a motive to impress.

BARTIROMO: In the interest of time, the candidates have agreed to forego opening and closing statements tonight. So let’s get started.

And we begin with you, Mr. Cain. I want to begin with what we saw today, another rough day for our money, for our 401(k)s. Once again, we were all impacted by the news that the Dow Jones Industrial Average dropped 400 points today. The reason, Italy is on the brink of financial disaster.

It is the world’s seventh largest economy. As president, what will you do to make sure that their problems do not take down the U.S. Financial system? It is the world’s seventh largest economy.

As president, what will you do to make sure their problems do not take down the U.S. financial system?

CAIN: Let’s start with two things. First, we must grow this economy. We have the biggest economy in the world. And as long as we are stagnant in terms of growth in GDP, we impact the rest of the world. We must do that.

But we’re not going to be able to do that until we put some fuel in the engine that drives economic growth, which is the business sector. This administration has done nothing but put stuff in the caboose, and it’s not moving this economy. We must grow this economy, number one.

Number two, we must assure that our currency is sound. Just like a dollar must be dollar when we wake up in the morning, just like 60 minutes is in an hour, a dollar must be a dollar. If we are growing this economy the way it has the ability to do and at the same time we are cutting spending seriously, we will have things moving in the right direction in order to be able to survive these kind of ripple effects.

BARTIROMO: So, to be clear, focus on the domestic economy, allow Italy to fail?

CAIN: Focus on the domestic economy or we will fail, so, yes, focus on the domestic economy first. There’s not a lot that the United States can directly do for Italy right now, because they have — they’re really way beyond the point of return that we — we as the United States can save them.

BARTIROMO: Governor Romney, should we allow Italy to fail? Should we have a stake in what’s going on in the eurozone right now?

ROMNEY: Well, Europe is able to take care of their own problems. We don’t want to step in and try and bail out their banks and bail out their governments. They have the capacity to deal with that themselves. They’re a very large economy.

And there will be, I’m sure, cries if Italy does default, if Italy does get in trouble. And we don’t know that’ll happen, but if they get to a point where they’re in crisis and banks throughout Europe that hold a lot of Italy debt will — will then face crisis and there will have to be some kind of effort to try and uphold their financial system.

There will be some who say here that banks in the U.S. that have Italian debt, that we ought to help those, as well. My view is no, no, no. We do not need to step in to bail out banks either in Europe or banks here in the U.S. that may have Italian debt. The right answer is for us… [applause]

BARTIROMO: But — but the U.S. does contribute to the International Monetary Fund, and the IMF has given $150 billion to the eurozone. Are you saying the U.S. should stop contributing to the IMF?

ROMNEY: I’m happy to continue to participate in world efforts like the World Bank and the IMF, but I’m not happy to have the United States government put in place a TARP-like program to try and save U.S. banks that have Italian debt, foreign banks doing business in the U.S. that have Italian debt, or European debt. We’re just — banks there.

There’s going to be an effort to try and draw us in and talk about how we need to help — help Italy and help Europe. Europe is able to help Europe. We have to focus on getting our own economy in order and making sure we never reach the kind of problem Italy is having.

If we stay on the course we’re on, with the level of borrowing this administration is carrying out, if we don’t get serious about cutting and capping our spending and balancing our — our budget, you’re going to find America in the same position Italy is in four or five years from now, and that is unacceptable. We’ve got to fix our — our deficit here.

CRAMER: Congressman Paul… [applause] [inaudible] to say, and I really get that. But I’m on the frontlines of the stock market. We were down 400 points today. We’re not going to be done going down if this keeps going on, if Italy keeps — the rates keep going up. Surely you must recognize that this is a moment-to-moment situation for people who have 401(k)s and IRAs on the line and you wouldn’t just let it fail, just go away and take our banking system with it?

PAUL: No, you have to let it — you have to let it liquidate. We’ve had — we took 40 years to build up this worldwide debt. We’re in a debt crisis never seen before in our history. The sovereign debt of this world is equal to the GDP, as ours is in this country. If you prop it up, you’ll do exactly what we did in the depression, prolong the agony. If you do — if you prop it up, you do what Japan has done for 20 years.

So, yes, you want to liquidate the debt. The debt is unsustainable. And this bubble was predictable, because 40 years ago we had no restraints whatsoever on the monetary authorities, and we piled debt on debt, we pyramided debt, we had no restraints on the spending. And if you keep bailing people out and prop it up, you just prolong the agony, as we’re doing in the housing bubble.

PAUL: Right now, Fannie Mae and Freddie Mac are demanding more money because we don’t allow the market to determine what these mortgages are worth. If you don’t liquidate this and clear the market, believe me, you’re going to perpetuate this for a decade or two more, and that is very, very dangerous.

CRAMER: Governor… [applause] [inaudible] Italy’s too big to fail. It’s great. I’d love it if we were independent. It would be terrific to say, “It’s your fault. It’s your fault. It’s your problem.” But if this goes, the world banking system could shut down. Doesn’t that involve our banks, too?

HUNTSMAN: So we wake up this morning, and we find that the yield curve with respect to Italy is up, and prices are down. So if you want a window into what this country is going to look like in the future if we don’t get on top of our debt, you are seeing it playing out in Europe right now.

You are seeing the metastasy (ph) effect of the banking sector. And what does it mean here? What am I most concerned about, Jim? I’m concerned that it impacts us in way that moves into our banking sector where we have got a huge problem called “too big to fail” in this country.

We have six banks in this country that combined have assets worth 66 percent of our nation’s GDP, $9.4 trillion. These institutions get hit. They have an implied bailout by the taxpayers in this country, and that means that we are setting ourselves up for disaster again.

Jim, as long as we have banks that are “too big to fail” in this country, we are going to catch the contagion and it’s going to hurt us. We have got to get back to a day and age where we have properly sized banks and financial institutions.

HARWOOD: Thank you, Governor.

Governor Romney, I want to switch… [applause]

HARWOOD: … to the bailout drama that we lived through in this country, and no state understands it better than the state of Michigan. I’m going to talk a little bit about your record on that. Four years ago when you were running for the Republican nomination and the auto industry was suffering, you said, where is Washington? After the election, when the Bush administration was considering financial assistance for the automakers, you said, no, let the Detroit go bankrupt.

Now that the companies are profitable again, after a bailout supported by your Republican governor here in Michigan, you said, well, actually, President Obama implemented my plan all along — or he gravitated to my plan.

With a record like that of seeming to be on all sides of the issue, why should Republicans be confident in the steadiness of your economic leadership?

ROMNEY: John, I care about this state and about auto industry like — I guess like no one else on this stage having been born and raised here and watched my parents make their life here. I was here in the 1950s and 1960s when Detroit and Michigan was the pride of the nation.

I have seen this industry and I’ve seen this state go through tough times. And my view some years ago was that the federal government, by putting in place CAFE requirements that helped foreign automobiles gain market share in the U.S., was hurting Detroit. And so I said, where is Washington? They are not doing the job they ought to be doing.

My view with regards to the bailout was that whether it was by President Bush or by President Obama, it was the wrong way to go. I said from the very beginning they should go through a managed bankruptcy process, a private bankruptcy process.

We have capital markets and bankruptcy, it works in the U.S. The idea of billions of dollars being wasted initially then finally they adopted the managed bankruptcy, I was among others that said we ought to do that.

And then after that, they gave the company to the UAW. They gave General Motors to the UAW and they gave Chrysler to Fiat. My plan, we would have had a private sector bailout with the private sector restructuring and bankruptcy with the private sector guiding the direction as opposed to what we had with government playing its heavy hand.

HARWOOD: Governor, let me follow up, because… [applause]

HARWOOD: … the auto bailout is part of a larger issue facing your candidacy, as you know. Your opponents have said you switched positions on many issues. It is an issue of character, not personal, but political, you seemed to encapsulate it in the last debate when you said, “I’m running for office, for Pete’s sake.”

What can you say to Republicans to persuade them that the things you say in the campaign are rooted in something deeper than the fact that you are running for office?

ROMNEY: John, I think people know me pretty well, particularly in this state, in the state of Massachusetts, New Hampshire that’s close by, Utah, where I served in the Olympics. I think people understand that I’m a man of steadiness and constancy.

I don’t think you are going to find somebody who has more of those attributes than I do. I have been married to the same woman for 25 — excuse me, I will get in trouble, for 42 years. [laughter]

ROMNEY: I have been in the same church my entire life. I worked at one company, Bain, for 25 years. And I left that to go off and help save the Olympic Games. I think it is outrageous the Obama campaign continues to push this idea, when you have in the Obama administration the most political presidency we have seen in modern history.

They are actually deciding when to pull out of Afghanistan based on politics. Let me tell you this, if I’m president of the United States, I will be true to my family, to my faith, and to our country, and I will never apologize for the United States of America. That’s my belief. [cheering and applause]

HARWOOD: Governor Perry, I want to ask you about this, because you have raised this issue yourself about Governor Romney. And you are running as a politician with strong convictions.

HARWOOD: From the flip side, Ronald Reagan raised taxes when the deficit got too big, George W. Bush supported TARP and the auto bailout when he thought we might face a great depression — second great depression. Does that — examples like that tell you that good, effective leaders need to show the kind of flexibility that Governor Romney has shown on some issues?

PERRY: The next president of the United States needs to send a powerful message not just to the people of this country, but around the world, that America is going to be America again, that we are not going to pick winners and losers from Washington, D.C., that we are going to trust the capital markets and the private sector to make the decisions, and let the consumers pick winners and losers. And it doesn’t make any difference whether it’s Wall Street or whether it’s some corporate entity or whether it’s some European country. If you are too big to fail, you are too big. [applause]

BARTIROMO: Speaker Gingrich, Federal Reserve Chairman Ben Bernanke has called unemployment in this country a national crisis due to the amount of days people are out — months that people are out of work and the number of people out of work. Many of you have come up with tax reform plans. Why is tax reform the path to job creation? And if it’s not the only path, what else can you implement to get people back to work?

GINGRICH: Well, first of all, I think Ben Bernanke is a large part of the problem and ought to be fired as rapidly as possible. [applause] I think the Federal Reserve ought to be audited and we should have all the decision documents for 2008, ’09 and ’10 so we can understand who he bailed out, why he bailed them out, who he did not bail out, and why he did not bail them out. [applause] So, I’m glad that Ben Bernanke recognizes some of the wreckage his policies have led to.

The reason we follow — I think most of us are for tax policies that lead to jobs is because we have had two cycles in my lifetime, Ronald Reagan, and the Contract with America, both of which had the same policy: lower taxes, less regulation, more American energy, and have faith in the American job creator as distinct from the Saul Alinsky radicalism of higher taxes, bigger bureaucracy with more regulations, no American energy, as the president announced again today in his decision on offshore, and finally class warfare.

So I would say that all of us on the stage represent a dramatically greater likelihood of getting to a paycheck and leaving behind food stamps than does Barack Obama. [applause]

BARTIROMO: Congresswoman Bachmann, same question to you. How can you create jobs as quickly as possible?

BACHMANN: Well, I think one thing that we know is that taxes lead to jobs leaving the country. All you need to know is that we have the second highest corporate tax rate in the world.

And if you go back to 1981, and you look around the world, we had a lot of high corporate tax countries. It was 47 percent on average on a lot of countries across the world.

But if you look today in the United States, we have an effective rate if you average in state taxes, with federal taxes, of about 40 percent. But the world took a clue, because capital is mobile, and capital went to places where corporate tax rates went to 25 percent and falling.

We’re still stuck in a 1986 era of about a 40 percent tax rate. We have to lower the tax rate because it’s a cost of doing business, but we have to do so much more than that.

Our biggest problem right now is our regulatory burden. The biggest regulatory problem we have is Obamacare and Dodd/Frank. I will repeal those bills. I have written those bills to repeal those bills that have got to go. But beyond that — [applause]

BACHMANN: But beyond that, we have to legalize American energy. And here is something else that we have to do that will help the economy. We have to build the fence on America’s southern border and get a grip on dealing with our immigration problem.

BARTIROMO: OK. [applause]

HARWOOD: Senator Santorum, you proposed a zero tax on manufacturing businesses.

SANTORUM: I have.

HARWOOD: I understand the sentiment behind that. And the state of Michigan has lost hundreds of thousands of manufacturing jobs over the last few decades. Isn’t that the kind of distortion in the tax code that people want to get away from in order to get rates down: flatter, simpler, fairer?

SANTORUM: I think getting the rate down to zero is down — is pretty far down. That’s good.

HARWOOD: But it’s down for the manufacturing industry, as opposed to people doing other things. Isn’t that picking winners and losers?

SANTORUM: It’s down for a sector of the economy, not picking an individual winner or loser. It’s down for an entire sector of the economy that we are getting our hat handed to us by losing jobs.

We see that here in Michigan, we see it across this country. And the reason is government has made us uncompetitive.

We need to compete on taxes. We need to compete on regulations. We need to repeal Obamacare. We need to — I’ve said I’m going the repeal every single Obama-era regulation that cost businesses over $100 million. Repeal them all. We’ll — we’ll send a very clear message out to manufactures in this country and all over the world that America will compete.

Some have suggested we need to go into a trade war with China and have tariffs. That just taxes you. I don’t want to tax you. I want to create an atmosphere where businesses and manufacturers can be profitable. We’ll lower taxes, repatriating funds, 0 percent tax if you repatriate those funds and invest them in plant and equipment.

And then, of course, an energy policy that everyone on this stage is going to agree with that says, we are going to produce energy in this country. I’m different than many of them, that I’m going to cut all the subsidies out and let the market work, as opposed to creating incentives for different — different forms of energy that the government supports. [applause]

BARTIROMO: You have all said that — that you will repeal the president’s health care legislation. We will get into that, because we want to know, then what? What is the plan once you repeal Obamacare?

But, first, Mr. Cain, the American people want jobs, but they also want leadership. They want character in a president. In recent days, we have learned that four different women have accused you of inappropriate behavior. Here we’re focusing on character and on judgment. [booing]

You’ve been a CEO.

CAIN: Yes.

BARTIROMO: You know that shareholders are reluctant to hire a CEO where there are character issues. Why should the American people hire a president if they feel there are character issues?

CAIN: The American people deserve better than someone being tried in the court of public opinion based on unfounded accusations. That’s… [applause] And I value my character and my integrity more than anything else. And for every — one person that comes forward with a false accusation, there are probably — there are thousands who would say none of that sort of activity ever came from Herman Cain.

You’re right. This country’s looking for leadership. And this is why a lot of people, despite what has happened over the last nine days, are still very enthusiastic behind my candidacy. Over the last nine days… [applause] Over the last nine days, the voters have voted with their dollars, and they are saying they don’t care about the character assassination. They care about leadership and getting this economy growing and all of the other problems we face. [applause]

HARWOOD: Governor Romney, when you were at Bain Capital, you purchased a lot of companies. You could fire the CEO and the management team or you could keep them. Would you keep a CEO — are you persuaded by what Mr. Cain has said? Would you keep him on if you bought his company? [booing]

ROMNEY: Look, look, Herman Cain is the person to respond to these questions. He just did. The people in this room and across the country can make their own assessment. I’m not… [crosstalk] [applause]

HARWOOD: Governor Huntsman, let me switch back to the economy. The… [applause] Many Republicans have criticized the Occupy Wall Street movement, but we had an NBC News-Wall Street Journal poll this week that showed a large proportion of the American people — 76 percent — said they believe there’s something wrong with our economy that tilts toward the wealthy at the expense of others. Do you consider something wrong with the structure of our economy in the income inequality that it produces? Is that something government should do something about? And if so, what?

HUNTSMAN: Let me just say that I want to be the president of the 99 percent. I also want to be the president of the 1 percent. This nation is divided, and it’s painful, and it is unnatural for the most optimistic, blue-sky people this world has ever known. We are problem-solvers.

When I hear out the people who are part of the Wall Street protests, I say, thank goodness we have the ability to speak out. I might not agree with everything they say. I don’t like the anti- capitalism messages. But I do agree that this country is never again going to bail out corporations. I do agree… [applause] Thank you. I do agree that we have blown through trillions and trillions of dollars with nothing to show on the balance sheet but debt, and no uplift in our ability to compete, and no addressing our level of unemployment.

HUNTSMAN: And I do agree that we have institutions, banks that are too big to fail in this country. And until we address that problem — we can fix taxes. We can fix the regulatory environment. We can move toward energy independence. So long as we have instant banks (ph) that are too big to fail, we are setting ourselves up for long-term disaster and failure.

HARWOOD: So, Governor, you agree with Governor Romney that the bailout that Governor Snyder supports in Michigan was a mistake?

HUNTSMAN: The bailout here in the auto sector, $68 billion worth, we are going to end up footing a bill — Governor Snyder knows that — of probably $15 billion when all is said and done. I don’t think that’s a good use of taxpayer money.

Instead, there ought to be some way of taking the auto sector through some sort of reorganization, get them back on their feet. The people in this country are sick and tired of seeing taxpayer dollars go toward bailouts, and we’re not going to have it anymore in this country. [applause]

CRAMER: Governor Romney, do you believe public companies have any social responsibility to create jobs, or do you believe, as Nobel Laureate Milton Friedman, the most important, most influential conservative economist of the 20th century held, that corporations should exist solely to create maximum profit for their shareholders?

ROMNEY: This is a wonderful philosophical debate. But you know what? We don’t have to decide between the two, because they go together.

Our Democratic friends think when a corporation is profitable, that’s a bad thing. I remember asking someone, “Where do you think profits go? When you hear that a company is profitable, where do you think it goes?” And they said, “Well, to pay the executives their big bonuses.”

I said, “No, actually, none of it goes to pay the executives. Profit is what is left over after they have all been paid.”

What happens with profit is that you can grow the business. You can expand it. You have working capital and you hire people.

The right thing for America is to have profitable enterprises that can hire people. I want to make American businesses successful and thrive.

What we have in Washington today is a president and an administration that doesn’t like business, that somehow thinks they want jobs, but they don’t like businesses. Look, I want to see our businesses thrive and grow and expand and be profitable. I want to see more — [applause]

CRAMER: Governor Perry, 30 seconds to you.

Do you think that companies can both be profitable and be able to create jobs? Do you think it’s a dichotomy? Do you think they can do it?

PERRY: There better be. And that’s the reason the tax plan that I laid out, a 20 percent flat tax on the personal side and a 20 percent corporate tax rate, that will get people working in this country. We need to go out there and stick a big old flag in the middle of America that says “Open for business again.” [applause]

CRAMER: Mr. Speaker, how about to you, can corporations do both?

GINGRICH: Sure. Look, obviously, corporations can and should do both. And what is amazing to me is the inability of much of our academic world and much of our news media and most of the people on Occupy Wall Street to have a clue about history. [applause] In this town, Henry Ford started as an Edison Electric supervisor who went home at night and built his first car in the garage. Now, was he in the 99 percent or the one percent?

Bill Gates drops out of college to found Microsoft. Is he in the one percent or the 99 percent?

Historically, this is the richest country in the history of the world because corporations succeed in creating both profits and jobs, and it’s sad that the news media doesn’t report accurately how the economy works. [applause]

BARTIROMO: Mr. Speaker — I’m sorry, but what is the media reporting inaccurately about the economy?

GINGRICH: What?

BARTIROMO: What is the media reporting inaccurately about the economy? [laughter]

GINGRICH: I love humor disguised as a question. That’s terrific.

I have yet to hear a single reporter ask a single Occupy Wall Street person a single rational question about the economy that would lead them to say, for example, “Who is going to pay for the park you are occupying if there are no businesses making a profit?” [applause]

CRAMER: Senator Santorum, I want to talk about a high-quality problem our country has.

I just came back from North Dakota. We have made the largest oil discovery in a generation there. Not only is it a — the find a big step toward creating energy independence, it stands to create as many as 300,000 jobs. But what the guys tell me up there is that they can’t handle the rush without federal help.

Would you favor incentives, incentives to get workers and businesses to where the jobs are to support this boom?

SANTORUM: No, because we have done it in Pennsylvania. Pennsylvania has Marcellus Shale. It took a while for us to ramp up, but we’re drilling 3,000 to 4,000 wells.

The price of natural gas, because of Marcellus Shale, which is the second largest natural gas find in the world, has gone from $12 to $3.65. And we let the marketplace work. So, no, we didn’t have the federal government come in and bail us out.

I want to make the point about manufacturing jobs again, because if you’re — if you’re talking about creating jobs that trickle down, I agree with Newt. We have folks who have innovators. But he always — he talked about innovators that — that created jobs for blue- collar workers. The unemployment rate among non-college-educated is well into the double digits in America. It’s 4 percent or 5 percent for people who have college degrees.

The reason I put forth this manufacturing plan is not just so we can say “Made Here in America,” that we can create opportunities for everyone in America, including those that don’t have that college skill set, people who built this country, like my grandfather, who was a coal miner. So — so that is a very important part that Republicans, unfortunately, are not talking about.

We need to talk about income mobility. We need to talk about people at the bottom of the — of the income scale being able to get necessary skills and rise so they can support themselves and a family. And that’s what manufacturing does, and that’s why I’m laser-beam focused on it. [applause]

BARTIROMO: Let’s get back to tax reform. Mr. Cain, let’s talk fairness in taxation. Ever since this country started taxing income 100 years ago, our system charges those people who make more money a higher rate than those people who make less money. Governor Perry has said he doesn’t believe in that approach, and your 9-9-9 plan suggests you don’t, either.

Why now, when the higher income group is doing better than the rest of America, is the time to switch to the same rate for all of us?

CAIN: My proposal is the only one that solves the problem by throwing out the current tax code, which has been a mess for decades, and we need to put in something different that I proposed, 9-9-9. It satisfies five simple criteria. It is simple. The complexity costs us $430 billion a year. It is transparent. People know what it is. There are thousands of hidden sneak-a-taxes in the current tax code. That’s why I want to throw it out.

It is fair. The reason it’s fair is because of the definition in Webster which says everybody gets treated the same. All businesses get treated the same, not having Washington, D.C., pick winners and losers. This is why I have proposed a bold plan of 9-9-9, 9 percent business flat tax, 9 percent tax on personal income, and a 9 percent national sales tax. It treats everybody the same. And it will boost this economy.

BARTIROMO: How do you ensure that, when the government needs more revenue, that the sales tax doesn’t go up and that plan doesn’t turn in 19-19-19?

CAIN: Tax codes do not raise taxes. Politicians do. [applause]

And as long as [inaudible] the people will hold the politicians’ feet to the fire. It’s not the code that raises taxes. It’s the politicians, because the code — because the approach, 9-9-9, would be very visible, the American people are going to hold the rates at 9.

HARWOOD: Governor Romney, Mr. Cain’s got a flat tax. Rick Perry’s got a flat tax. Congresswoman Bachmann is talking about a flat tax. You don’t have a flat tax. You’re proposing to preserve the Bush-era tax rates. What is wrong with the idea that we should go to one rate? Why do you believe in a progressive tax system?

ROMNEY: Well, I would like to see our tax rates flatter. I’d like to see our code simpler. I’d like to see the special breaks that we have in the code taken out. That’s one of the reasons why I take the corporate rate from 35 down to 25, is to take out some of the special deals that are there.

With regards to our tax code, what I want to do is to take our precious dollars as a nation and focus them on the people in this country that have been hurt the most, and that’s the middle class. The Obama economy has really crushed middle-income Americans.

This president has failed us so badly, we have 26 million people out of work, working part-time jobs that need full-time work, or stopped looking for work altogether. Median incomes have dropped 10 percent in the last three years. At the same time, gasoline prices are up, food prices are up, health care costs are up.

And so what I want to do is help the people who’ve been hurt the most, and that’s the middle class. So what I do is focus a substantial tax break on middle-income Americans. Ultimately, I’d love to see — see us come up with a plan that simplifies the code and lowers rates for everybody. But right now, let’s get the job done first that has to be done immediately. Let’s lower the tax rates on middle-income Americans.

HARWOOD: Congresswoman Bachmann, Governor Romney is accepting the premises of the Democratic argument that you have to have a fair approach to taxation that preserves different rates for different people. Why is he wrong?

BACHMANN: Well, I would say President Obama is the one that’s wrong, because President Obama’s plan for job creation has absolutely nothing to do with the true people who know how to create jobs. He should really be going to job-creators if he wants to know how to create jobs. Instead, he continues to go to a General Axelrod in Chicago to look for his orders to figure out how to deal with the economy. That won’t work.

We know what needs to be done. We have a real problem. When you have 53 percent of Americans paying federal income taxes, but you have 47 percent of Americans who pay no federal income taxes, you have a real problem.

And that’s why in my tax plan, I have everyone paying something because everyone benefits by this magnificent country. So even if it means paying the price of two Happy Meals a year, like $10, everyone can afford to pay at least that.

And what it does is create a mentality in the United States that says that freedom is free. But freedom isn’t free. We all benefit. We all need to sacrifice. Everybody has to be a part of this tax code.

BARTIROMO: Congressman Ron Paul… [applause]

BARTIROMO: … you have said you want to close down agencies. Tell us about your tax plan as well as closing agencies — federal agencies. Where do those jobs go?

PAUL: Well, eventually they go into the private sector. Then don’t all leave immediately when the plan goes into effect. But what my plan does is it addresses taxes in a little different way.

We are talking about the tax code. But that’s the consequence, that’s the symptom. The disease is spending. Every time you spend, spending is a tax. We tax the people, we borrow, and then we print the money and the prices go up, and that is a tax.

So you have to address the subject of spending. That is the tax. That is the reason I go after the spending. I propose in the first year cut $1 trillion out of the budget in five departments. [cheering and applause]

PAUL: Now the other thing is that you must do if you want to get the economy going and going again is you have to get rid of price- fixing. And the most significant price-fixing that goes on, that gave us the bubble, destroyed the economy, and is preventing this from coming out, is the price-fixing of the Federal Reserve, manipulating interest rates way below market rates.

You have to have the market determine interest rates if you want a healthy, viable economy.

BARTIROMO: So you think the economy would be stronger if interest rates were higher right now?

PAUL: You would have more incentive. You would take care of the elderly. They get cheated. They get nothing for their CDs. Why cheat them and give the banks loans at zero percent? And then they loan it back to the government at 3 percent. They are ripping us off at the expense of those on fixed incomes and retirees.

BARTIROMO: Even though higher interest rates would make it much more expensive to borrow, mortgages.

PAUL: But you want is the market to determine this. Whoever thought that one person, the Federal Reserve Board chairman, knows what the money supply should be? Just in the past six months, M1 has gone up at the rate of 30 percent. That spells inflation. That spells lower standard of living and higher prices and watch out. They are coming. [cheering and applause]

BARTIROMO: We are just getting started tonight. When we return, how will the candidates breathe new life into the lifeless housing market?

HARWOOD: Plus, the view of the economy from the corner office.

[begin video clip]

UNKNOWN: I think we are in serious trouble. Business people are struggling.

UNKNOWN: The problems in the economy didn’t arrive in 20 minutes and they won’t be resolved in 20 minutes.

UNKNOWN: The most important economic issue of concern to me is lack of leadership in government, and the lack of any focus on building confidence both with consumers and the business community.

[end video clip]

HARWOOD: So how are the candidates going to turn things around? CNBC’s “Republican Presidential Debate” will be right back. Stay with us.

[cheering and applause]

[commercial break]

BARTIROMO: Welcome back to be CNBC’s Republican Presidential Debate.

With us for this portion of the program, CNBC’s senior economic reporter, Steve Liesman.

Welcome, Steve.

LIESMAN: Great to be here, Maria. Thank you.

BARTIROMO: Most economists agree that there can be no economic recovery without a recovery in housing. American families have lost some $7 trillion in home value in the last five years. Right now, four million people are behind on their mortgage or in foreclosure, 25 percent of homeowners owe more to the banks than their house is actually worth.

Governor Romney has said that the government should let the foreclosure process play out so that the housing market can recover and the free markets can work.

Speaker Gingrich, is Governor Romney right?

GINGRICH: We, he’s certainly right in the sense that you want to get through to the real value of the houses as fast as you can, because they’re not going to rise in value as long as you stay trapped, as Japan has done now for 20 years. But I think there are two specific steps you have got to understand in terms of housing.

To pick up on something Congresswoman Bachmann said, if the Republican House next week would repeal Dodd/Frank, and allow us to put pressure on the Senate to repeal Dodd/Frank, you would see the housing market start to improve overnight. Dodd/Frank kills small banks, it kills small business. The federal regulators are anti- housing loan, and it has maximized the pain level.

You could also change some of the rules so it would be easier to do a short sale where the house is worth less than mortgage than it is to do a foreclosure. Today, the banks are actually profiting more by foreclosing than encouraging short sales.

But in the long run, you want the housing market to come back? The economy has to come back.

When you are at four percent unemployment, you suddenly have a dramatic increase in demand for housing. When you’re at nine percent- plus unemployment, it’s hard to get the housing market to come back.

BARTIROMO: Governor Romney, respond in 30 seconds. Not one of your 59 points in your economic plan mentions or addresses housing. Can you tell us why?

ROMNEY: Yes, because it’s not a housing plan. It’s a jobs plan. And the right way to get — [applause] The best thing you can do for housing is to get the economy going, get people working again, seeing incomes, instead of going down, incomes coming up so people can afford to buy homes. The things the Speaker just indicated are excellent ideas as well. You have to let the market work and get people in the homes again, and the best way for that to happen is to allow this economy to reboot.

What we know won’t work is what this president has done, which is to try and hold off the foreclosure process, the normal market process, to put money into a stimulus that failed, and to put in place a whole series of policies from Obamacare to Dodd/Frank that it made it hard for this economy to get going. You want to get America’s economy going? We know how to do it. Just do almost the exact opposite of what President Obama has done. [applause]

LIESMAN: Governor Romney, we have created 2.7 million jobs since February, 2010. Over that period of time, the housing market has continued to decline. We are at 2003 price levels now.

If we keep going the way we are going, in four or five years, we’ll be at 1999 price levels. The $7 trillion figure that Maria mentioned could almost double.

Are you willing to let that happen in America?

ROMNEY: And exactly what would you do instead? Would you decide to have…

LIESMAN: I’m asking you.

ROMNEY: … well, to have the federal government go out and buy all the homes in America? That’s not going to happen in this country. Markets work. When you have government play its heavy hand, markets blow up and people get hurt.

And the reason we have the housing crises we have is that the federal government played too heavy a role in our markets. The federal government came in with Fannie Mae and Freddie Mac, and Barney Frank and Chris Dodd told banks they had to give loans to people who couldn’t afford to pay them back. [applause]

And so — and so our friends — our friends in Washington today, they say, oh, if we’ve got a problem in housing, let’s let government play a bigger role. That’s the wrong way to go. Let markets work. Help people get back to work. Let them buy homes. You’ll see home prices come back up if we allow this market to work. [applause]

LIESMAN: But, Governor — Governor Perry, every quarter I get to report the GDP figures, and it’s a negative number for housing, and we’ve lost some 2 million construction jobs. Housing creates jobs, as well, doesn’t it?

PERRY: Not a negative number in Texas. And one of the reasons is because we have put policies into place that follow my plan to get America back working again.

LIESMAN: OK, so translate that plan to America.

PERRY: When — when you look at what I’ve laid out, whether it — the energy side and getting the energy industry going — and Rick Santorum is absolutely correct on that, is let’s get our energy industry freed up, federal lands, federal waters, pull back all of those regulations. Everybody on this stage understands it’s the regulatory world that is killing America. [applause]

The tax side of it, yeah. Have a flat tax. Have a corporate flat tax in there, as well. But the real issue facing America are regulations. It doesn’t make any difference whether it’s the EPA or whether it’s the federal banking — the Dodd-Frank or Obamacare. That’s what’s killing America.

And the next president of the United States has to have the courage to go forward, pull back every regulation, since 2008, audit them for one thing: Is it creating jobs, or is it killing jobs? And if that regulation is killing jobs, do away with it. [applause]

HARWOOD: Congresswoman Bachmann, in one of the last debates, you were asked what you would do about foreclosures, and you told moms to hang on. But your advice, as your colleagues have mentioned, was let the economy recover. So you agree with Governor Romney that the way to fix the housing market is to let the foreclosure process proceed more rapidly?

BACHMANN: Well, what I agree with is that we have got to stop what we’re doing now. When we had the financial meltdown, 50 percent of the homes are being financed by Fannie and Freddie. Today it’s 90 percent of the homes. In other words, the government is the backer of the homes.

Well, let’s take a look, an analysis of what a great, brilliant job Freddie and Fannie are doing. They just applied this week for another $7 billion bailout because they’re failing. The other one applied for a $6 billion bailout because they’re failing.

But what did they do? They just gave bonuses of almost $13 million to 10 top executives. This is the epicenter of capital — crony capitalism. That’s what’s wrong with Washington, D.C.

For these geniuses to give 10 of their top executives bonuses at $12 million and then have the guts to come to the American people and say, “Give us another $13 billion to bail us out just for the quarter,” that’s lunacy. We need to put them back into bankruptcy and get them out of business. They’re destroying the housing market. [applause]

HARWOOD: Since — since you mentioned Fannie and Freddie, Speaker Gingrich, 30 seconds to you, your firm was paid $300,000 by Freddie Mac in 2006. What did you do for that money?

GINGRICH: Were you asking me?

HARWOOD: Yes.

GINGRICH: I offer them advice on precisely what they didn’t do. [laughter]

Look — look, this is not — this is not…

HARWOOD: Were you not trying to help Freddie Mac fend off the effort by the Bush administration… [crosstalk]

GINGRICH: No. No, I do — I have never…

HARWOOD: … and the — to curb Freddie Mac.

GINGRICH: I have — I assume I get a second question. I have never done any lobbying. Every contract was written during the period when I was out of the office, specifically said I would do no lobbying, and I offered advice.

And my advice as a historian, when they walked in and said to me, “We are now making loans to people who have no credit history and have no record of paying back anything, but that’s what the government wants us to do,” as I said to them at the time, this is a bubble. This is insane. This is impossible.

GINGRICH: It turned out, unfortunately, I was right and the people who were doing exactly what Congresswoman Bachmann talked about were wrong. And I think it’s a good case for breaking up Fannie Mae and Freddie Mac and getting much smaller institutions back into the private sector to be competitive and to be responsible for their behavior. [applause]

LIESMAN: Mr. Cain, government-sponsored entities Fannie Mae and Freddie Mac, as Congresswoman Bachmann said, now underwrite or guarantee 90 percent of the home financing in this country. What would you do with these — with Fannie Mae and Freddie Mac? Would you shut them down even though it could mean higher interest rates for America? Does it make it even harder than it is right now for Americans to get home loans?

CAIN: You don’t start there. You start with fixing the real problem, which is growing this economy, which is why I have put a bold solution on the table, 9-9-9.

Secondly, then you get the regulators off of the backs of the banks like someone mentioned. Get the regulators out of the way, such that the small banks and the medium-sized banks aren’t being forced out of the business.

They would then be in a better position, and they might develop a desire in order to help homeowners reset their mortgages if they were able to see, number three, some certainty. Uncertainty is what’s killing this economy. And until we throw out the tax code, and put in something bold, get government out of the way by reducing the regulatory environment, we are going to still have our housing problem.

LIESMAN: I’m sorry, Mr. Cain, but you would come into office and Fannie Mae and Freddie Mac would be there. The question was, what would you do with them?

CAIN: OK. After I did those three things that I outlined, then deal with Fannie Mae and Freddie Mac.

You don’t start solving a problem right in the middle of it. So we’ve got to do that first.

I would also turn those GSEs into private entities. The government does not need to be in that business. I would find a way to unwind Fannie Mae and Freddie Mac, such that the marketplace can determine the future of the housing market. [applause]

HARWOOD: Governor Huntsman, I want to go back to the issue that you raised before about too big to fail. If anything, that problem has gotten worse since the financial crisis than before. The 10 biggest bank holding companies in this country now hold nearly 90 percent of all the assets in the banking system, up from 75 percent in 2006.

So, what would you do? Would you break up the banks to remove the risk, or diminish the risk for American taxpayers?

HUNTSMAN: Let me just say, on the housing discussion here, lost in all of this debate is the fact that there are people tuning in tonight who are upside down in terms of the financing of their homes. They are feeling real pain. People who probably heard today that they lost a job.

These issues are very real. They are complicated. For us to say that there is an easy solution to housing, that’s just not right, and that’s not fair. The economy does have to recover in order for the housing market to pick up its slack and for us to get on to housing starts, which ought to be 15 percent of our nation’s GDP, and today it’s two percent.

With respect to the banks that are too big to fail, you know today we’ve got, as I mentioned earlier, six institutions that are equal to 60, 65 percent of our GDP, $9.4 trillion. They have an implied guarantee by the taxpayers that they will be protected. That’s not fair, that’s not right for the taxpayers.

HARWOOD: So you break them up?

HUNTSMAN: I say we need to right-size them. I say, in the 1990s, you had Goldman Sachs, for example. That was $200 billion in size. By 2008, it had grown to $1.1 trillion in size. Was that good for the people of this country, or —

HARWOOD: Well, how would you accomplish that? How would you right-size that? [crosstalk]

HUNTSMAN: I think we ought to set up some sort of fund. I think we ought to charge some sort of fee from the banks that mitigates the risk that otherwise the taxpayers are carrying. There has got to be something that takes the risk from the taxpayers off the table so that these institutions don’t go forward with this implied assumption that we’re going to bail them out at the end of the day. That’s not right, and it’s not fair for the taxpayers of this country.

BARTIROMO: Let’s stay on regulation for a moment. You have all said that you will repeal President Obama’s health care legislation.

Down the line, 30 seconds, if you repeal Obamacare, what’s the answer?

Jon Huntsman?

HUNTSMAN: I would say — and I would meet with the 50 governors of this country, and I would say, I did health care reform in my state, it took us three years to get it done. We delivered an insurance connector that was not a costly mandate.

You can sit down with the 50 governors and you can address cost containment. This is a $3 trillion industry, half of which any expert will tell you is totally nonsense and superfluous spending.

How do you get costs out of the system? How do you empower patients to better understand what they are getting when they go into the doctor’s office?

Number two, we need to do a better job in harmonizing medical records so that we can pull up on a consistent basis the most efficacious course of treatment for patients.

HUNTSMAN: And third, we need to close the gap on the uninsured without a costly mandate, letting the free market work and bringing people together with truly affordable insurance.

BARTIROMO: That’s time.

We want to get each of your comments on what the plan is.

Ron Paul?

PAUL: We need to get the government out of the business, and we do need to have the right to opt out of “Obama-care.” But we ought to have the right to opt out of everything. And the answer to it is turn it back over to the patient and the doctor relationship with medical savings accounts.

So I would say that we have had too much government. I have been in medicine, it has gone downhill. Quality has gone down. Prices have skyrocketed because of the inflation. So you need to get a market force in there, a medical savings account.

But this mess has been created — it’s a bipartisan mess. So it has been there for a while. So what we need is the doctor-patient relationship and medical savings account where you can deduct it from your taxes and get a major medical policy. Prices then would come down.

BARTIROMO: Thirty seconds, Governor Perry?

PERRY: Obviously on the Medicare side, you have to have an insurance type of a program where people have options of which — give them a menu of options of which they can choose from. I think you have to have the doctors and the hospitals and the other health care providers being given incentives on health care rather than “sick care.”

And then on Medicaid, it is really pretty simple, just like Jon and Mitt both know, you send it back to the states and let the states figure out how to make Medicaid work, because I will guarantee you we will do it safely, we will do it appropriately, and we will save a ton of money. [applause]

BARTIROMO: Mr. Cain. CAIN: The legislation has already been written. H.R. 3000. In the previous Congress it was H.R. 3400. And what that does — it has already been written. We didn’t hear about it in the previous Congress because “Princess Nancy” sent to it committee and it stayed there. It never came out. [laughter]

CAIN: H.R. 3000 allows the decisions to be with the doctors and the patients, not with the bureaucrat in Washington, D.C. The legislation has already been written. [applause]

BARTIROMO: Governor Romney?

ROMNEY: Health care in 30 seconds is a little tough. But let me try. Number one, you return to the states the responsibility for caring for their own uninsured. And you send the Medicaid money back to the states so they can craft their own programs. That’s number one.

Number two, you let individuals purchase their own insurance. Not just getting it through their company. But buy it on their own if they want to, and no longer discriminate against individuals who want to buy their insurance.

Number three, you do exactly what Ron Paul said. I don’t always say that. But I have got to say it right now. [laughter]

ROMNEY: And that is, you have to get health care to start working more like a market. And for that to happen, people have to have a stake in what the cost and the quality as well as of their health care. And so health savings account, or something called co- insurance, that’s the way to help make that happen.

And finally, our malpractice system in this country is nuts. We have got to take that over and make sure we don’t burden our system with it. [applause]

BARTIROMO: Mr. Speaker?

GINGRICH: Well, I just want point out, my colleagues have done a terrific job of answering an absurd question. To say in 30 seconds…

BARTIROMO: You have said you want to repeal “Obama-care,” correct?

GINGRICH: I did. Let me finish, if I may. To say in 30 seconds what you would do with 18 percent of the economy, life and death for the American people, a topic I’ve worked on since 1974, about which I wrote about called “Saving Lives and Saving Money” in 2002, and for which I founded the Center for Health Transformation, is the perfect case of why I’m going to challenge the president to seven Lincoln- Douglas style three-hour debates with a timekeeper and no moderator, at least two of which ought to be on health care so you can have a serious discussion over a several-hour period that affects the lives of every person in this country.

BARTIROMO: Would you would like to try to explain… [applause] Would you like to — would you like to try to explain in simple speak to the American people what you would do after you repeal the president’s health care legislation?

GINGRICH: In 30 seconds?

BARTIROMO: Take the time you need, sir. Take the time you need.

GINGRICH: I can’t take what I need. These guys will gang up on me… [crosstalk]

BARTIROMO: Do you want the answer the question tonight on health care or no? [crosstalk] Do you want to try to answer the question tonight, Speaker?

GINGRICH: Let me just say it very straight. One, you go back to a doctor-patient relationship and you involve the family in those periods where the patient by themselves can’t make key decisions. But you re-localize it.

Two, as several people said, including Governor Perry, you put Medicaid back at the state level and allow the states to really experiment because it’s clear we don’t know what we are doing nationally.

Three, you focus very intensely on a brand-new program on brain science because the fact is the largest single out-year set of costs we are faced with are Alzheimer’s, autism, Parkinson’s, mental health, and things which come directly from the brain.

GINGRICH: And I am for fixing our health rather than fixing our health bureaucracy because the iron lung is the perfect model of saving people so you don’t need to pay for federal program of iron lung centers because the polio vaccine eliminated the problem. That’s a very short [inaudible]. [applause]

BARTIROMO: Congresswoman.

BACHMANN: The main problem with health care in the United States today is the issue of cost. It’s just too expensive. And President Obama said that’s what he would solve in Obamacare, we’d all save $2,500 a year in our premiums.

Well, we have Obamacare, but we didn’t have the savings. So what I would do to replace it is to allow every American to buy any health insurance policy they want anywhere in the United States, without any federal minimum mandate. Today there’s an insurance monopoly in every state in the country. I would end that monopoly and let any American go anywhere they want. That’s the free market.

Number two, I would allow every American to pay for that insurance policy — their deductible, their co-pay, their pharmaceuticals, whatever it is that’s medical-related — with their own tax-free money.

And then, finally, I’d have true medical malpractice liability reform. If you do that, it’s very simple. People own their own insurance policies, and you drive the costs down, because what we have to get rid of is government bureaucracy in health care. That’s all we bought in Obamacare, was a huge bureaucracy. That has to go away. [applause]

BARTIROMO: Senator?

SANTORUM: This is, I think, the difference between me and a lot of the candidates here. I heard a lot of responses, but I haven’t — I haven’t seen a lot of consistency in some of — some of those responses on the last few questions.

When it comes to health care, back in 1992, I introduced the first health savings account bill that everybody up here said was the basis for consumer-driven health care. I was leading on that before anyone else was even talking about it. Secondly, I was someone who proposed a block grant for Medicaid way back in 1998 with Phil Gramm, again, leading on this issue. Same thing, reforming the Medicare program back in the 1990s, again, I led on these issues.

I was always for having the government out of the health care business and for a bottom-up, consumer-driven health care, which is different than Governor Romney and some of the other people on this panel.

Number two — and I didn’t get a chance to answer any of the housing questions. I was on the banking housing committee in — in the United States Senate. I was one of 24 people who wrote a letter to Harry Reid saying, please let us bring up this housing legislation, which I voted for in the committee, that would have put curbs on Fannie and Freddie. I — I was out there before this bubble burst saying this was a problem. I — I was in Scranton, Pennsylvania, the other day, and I had one of a — a home-builder, who was a head of the association, came up to me and said, Rick, I’m here to apologize. We came here to push you so you would oppose, you know, putting caps on Fannie and Freddie. You were right; we were wrong.

Time and time again, Wall Street, the Wall Street bailout, five of the eight people on this panel supported the Wall Street bailout. I didn’t. I know that we saw problems best from the bottom up, not the top down and government intervention in the marketplace.

BARTIROMO: Governor Romney, you have 30 seconds to respond.

ROMNEY: That’s — that’s fine. I believe very deeply in the functioning of markets. The work I’ve done in health care, actually worked as a consultant to the health care industry, to hospitals and various health institutions. I had the occasion of actually acquiring and trying to build health care businesses. I know something about it, and I believe markets work.

And what’s wrong with our health care system in America is that government is playing too heavy a role. We need to get our markets to work by having the consumer, the patient have a stake in what the cost and quality is of health care, give them the transparency they need to know where the opportunities are for lower cost and better quality, to make sure that the providers offer them the broadest array of options that they could have.

And once we have that happening, you’ll see us — 18 percent of our GDP is spent on health care. The next highest nation in the world is 12 percent. It’s a huge difference. We have to get the market…

BARTIROMO: Time.

ROMNEY: … to work to make sure that we get the kind of quality and value that America deserves.

HARWOOD: But, Governor, let me ask you about health care, because Congressman Paul said, put it back to the doctor and the patient. You said a few moments ago that you thought states should have the responsibility for insuring the uninsured. And, of course, in Massachusetts, you enacted an individual mandate and subsidies to have people who didn’t have insurance get it. So you think there’s a pretty large role for government in this area.

ROMNEY: Well, I think that people — that people have a responsibility to receive their own care, and the doctor-patient relationship is, of course, where that — where that exists — where that exists.

HARWOOD: But the government has the responsibility to force them?

ROMNEY: I — I didn’t know whether Ron Paul was saying we’re going to — he’s going to get rid of Medicaid. I would not get rid of Medicaid. It’s a health program for the poor.

What I said was I would take the Medicaid dollars that are currently spent by the federal government, return them to the states so that states can craft their own programs to care for their own poor, rather than having the federal government mandate a one-size- fits-all plan in the entire — entire nation. Obamacare is wrong. I’ll repeal it. I’ll get it done. [applause]

UNKNOWN: John?

HARWOOD: Congressman?

PAUL: My plan of cutting the budget by a trillion dollars does deal with Medicaid. And that is that it preserves it, and there is a transition period, with the goal that eventually we would hope to move that back into the economy. But right now, it would be too much to do it in one year.

You know, finding a trillion dollars was a job and a half, and getting rid of five departments.

So, yes, my budget takes into consideration health care for the elderly, health care on Medicaid, as well as child health care. At the same time, we deal with the bailouts, the banks, and all the benefits that they get from the financial system, because what we’re facing today is the crisis in this housing crisis.

If I could just have one second on that.

We face a housing crisis once again because it’s price-fixing. They’re fixing the prices of these mortgages too high, and this is why nobody will buy them.

This is why you have to get rid of Fannie Mae and Freddie Mac, sell all of that into the marketplace. And the reason they do this is to prop up the banks, because the banks have invested in Europe, they’ve invested in Fannie Mae and Freddie Mac, and these credit defaults swaps.

They’re in big trouble, and that is why they’re getting bailed out. And that’s why they are not allowing these mortgages to go down, and that is why we will most likely bail out Europe, which will be a real tragedy. [applause]

HARWOOD: Congressman, thank you for that. It’s time for a quick break.

LIESMAN: Hold it, John. I wanted to give them 15 seconds each to solve the deficit problem. [laughter]

BARTIROMO: We’ll come back to the deficit.

HARWOOD: When we return, balancing the budget, cutting the deficit, making college education more affordable.

BARTIROMO: Plus, a little lesson on Social Security.

You’re watching CNBC’s “Your Money, Your Vote: The Republican Presidential Debate.” [applause]

[commercial break]

[begin video clip]

NARRATOR: Next, we tackle the issues of Social Security, a spiraling deficit, and so much more, when “Your Money, Your Vote: The Republican Presidential Debate” continues in 90 seconds.

[commercial break]

HARWOOD: And welcome back. Joining us for this portion of the debate, Rick Santelli, CNBC’s on-air editor… [applause] … and Sharon Epperson, our personal finance correspondent.

Now, we’ll get to them in a moment, but, first, Senator Santorum, you were known as a tough partisan fighter in the Senate, but look where partisan fighting got us this summer, gridlock and a debt-rating downgrade. The American people don’t much like it, and neither does Doug Oberhelman, the CEO of Caterpillar. Let’s take a listen.

[begin video clip]

OBERHELMAN: Most people think our politicians are not helping the country get back on its feet. The last two presidents made promises to work across party lines, and both failed. How will you put our country ahead of your political party and solve the issues that are so critical for Americans? Be specific, please. These are promises.

[end video clip]

HARWOOD: And, Senator, let me ask you about — to set up that question. If everyone on this stage rules out any tax increases, even at a 10-to-1 ratio of spending cuts, as you have done, what could you possibly offer Democrats to get them to go along and compromise with you on the things that Republicans want?

SANTORUM: You create — you create a platform that they can buy into, because they see advantages of your — of your plan. For example, one of the reasons that I — I’ve put forward this manufacturing plan is because folks here in Michigan, Democrats and Republicans will vote for it.

I was at the New Hampshire House of Representatives the other day and spoke to a bipartisan group, talked about the — the tax plan, not just the manufacturing, but the broad-based plan that I have. And I had two Democratic House members go over to — to my chairman, Dan Tamburello, and said, hey, I want him to come to my district and talk about this. We can support it.

So when you put together a plan — look, if the Republican Party is just about keeping the top rate, you know, lower or cutting taxes, we’re not going to be reaching people. We’ve got to look at plans that bring people together. That’s why I focused on this sector. I understand, John, that the Wall Street Journal won’t like that I’m picking one sector over another. I don’t care.

What I need to do is bring America together, find a plan that can work, that can be implemented right away. It may not be the boldest plan in the world, but it’s one that will work. It’ll put people back to work. It will give the ability of people to rise in our society. It’s help with the jobs out in rural America, where the manufacturing loss has been the greatest and the employment rate is the highest.

You put a plan like that together, you’ll get Democrats and Republicans, and we’ll create jobs in the country, and we’ll get things done.

HARWOOD: Governor Romney, you’ve shown that you can work with Democrats. When you were governor, of course, you collaborated with Ted Kennedy on the health care plan that you enacted. You raised fees to balance the budget, and you used that as an argument to get the credit rating of your state upgraded. Independent voters might like that. Should Republican primary voters be nervous about it?

ROMNEY: Thanks for reminding everybody. [laughter]

You know, what I found is, in a state like mine where there are a few Democrats in the legislature — 85 percent of my legislature was Democrat — to get anything done — I was always in an away game, if you will. And to get something done, I had to see if there were Democrats who cared more about the state than they cared about their re-election or their party, and there were.

And right now, America faces a crisis. I think people on both sides of the aisle recognize that this is no longer a time just for worrying about the next election. This is a time to worry about America.

GINGRICH: You deal with Social Security as a free-standing issue. And the fact is, if you allow younger Americans to have the choice to go to a Galveston or Chilean-style personal Social Security savings account, the long-term effect on Social Security is scored by the Social Security actuary as absolutely stabilizing the system and taking care of it.

The key is there is $2.4 trillion in Social Security which should be off budget, and no president of the United States should ever again say because of some political fight in Washington, I may not be able to send you your check. That money is sitting there. That money is available. And the country ought to pay the debt it owes the people who put the money in there. [applause]

HARWOOD: Governor Romney, if I could follow up, Speaker Gingrich just said he is not prepared to raise taxes on the American people in the middle of a slow economy like this. That’s what would happen if the payroll tax cut is not extended.

Do you agree with him, and would you also support, when it comes down to it, an extension of the payroll tax cut?

ROMNEY: I don’t want to raise taxes on people in the middle of a recession. Of course not.

HARWOOD: So you’re for it?

ROMNEY: And that’s one of the reasons why we fought so hard to make sure the Bush tax cuts weren’t taken away by President Obama.

But, look, this issue of deficits and spending is not about just dollars and cents. It’s a moral issue. It’s a moral imperative.

We can’t continue to pass on massive debts to the next generation. We can’t continue to put at risk the greatest nation in the history of the Earth because of the profligate spending that’s going on in Washington, D.C.

HARWOOD: But to clarify, you agree with President Obama the payroll tax cut should be expanded?

ROMNEY: I want to keep our taxes down. I don’t want to raise any taxes anywhere. Let me tell you, I’m not looking to raise taxes. What I’m looking to do is to cut spending. And that’s why this last week I put out a plan that dramatically cuts spending in Washington, that gets us to a 20 percent cap, and makes sure that we have a balanced budget thereafter. And how do I do it? I have three major steps.

Number one, cut programs. Get rid of programs we don’t have to have like Obamacare.

Take a lot of programs that we have at the state level, number two — excuse me, at the federal level — and send them back to the states where they can be better run with less fraud and abuse.

And number three, finally, bring some productivity and management expertise to the federal government. I would cut the workforce by 10 percent and — I want to say one more, and that is this — I want to make sure we link the compensation of our federal bureaucrats to that which exists in the private sector. People who are public servants shouldn’t get more money than the taxpayers that they’re serving. [applause]

HARWOOD: Does any candidate on this stage disagree? Does any candidate disagree and oppose an extension of the payroll tax cut?

BACHMANN: Say that again.

HARWOOD: Does any candidate disagree with the Speaker and Governor Romney and oppose the extension of the payroll tax cut?

UNKNOWN: Yes.

HARWOOD: You oppose it?

BACHMANN: I do. I opposed it when it was first proposed, because I knew that it would blow a hole of $111 billion in the Social Security trust fund.

President Obama clearly did this for political reasons. That’s why he did it. And so I had made that warning then, because we actually have already run Social Security in the red. We aren’t just about to, we already have, six years ahead of time.

Now, consider the context. We have baby boomers in their peak earning years. This is when money should be flooding into the Social Security trust fund. Instead, we’re already in the red.

When we talked this evening about how much trouble we are in with spending, we are in a tremendous amount of trouble with spending. Just consider we pay a lot of taxes in this country, $2.2 trillion is what we send into Washington. The problem is, we spent at the government level $3.7 trillion. Your started out tonight talking — [crosstalk]

HARWOOD: Out of time, Congresswoman. Governor Huntsman?

HUNTSMAN: Thank you. It’s getting a little lonely over here.

SANTELLI: Our federal government still owns 500 million shares of GM stocks, guarantees trillions — trillions with a “T” — dollars of mortgages. They are basically the lender doing 90 percent of all the mortgage origination right now. And you consider the Federal Reserve, the Federal Reserve has purchased $2.62 trillion — again, with a “T” — of treasury securities, agency securities, and mortgage securities.

If you were president, how would your administration and would your administration reverse these obligations?

HUNTSMAN: I would clean up the balance sheet. And let me tell you what I worry about as much as anything else.

We talk about failed leadership. We certainly have failed leadership.

President Obama had two years to get this economy going and to move us toward an environment that speaks to job growth, and he’s failed miserably. But along with that, we have a real trust crisis in this country.

Between the American people and our institutions of power, Congress, the executive branch, Wall Street as well, there is no trust. We are running on empty. And when a democracy begins to run on empty because of government holdings and bailouts and being involved in ways that are absolutely inappropriate, based on constitutional and where we should be, that results in a diminution of trust by the American people. We’ve got to raise that trust.

So let me just tell you what I think needs to be done, in terms of bringing our economy up. We’ve heard about all these great tax plans. I think I’m the only one on this stage who’s actually delivered a flat tax. And I did that as governor of my state.

I put forward a proposal that I think is right for this country and getting it back on its feet. The Wall Street Journal has come out — the most respected editorial page economically, maybe in the entire world — has come out and endorsed my plan, said it’s the very best of the bunch.

And it very simply calls out just as I did as governor. So I’m not sitting here talking about academic theory. I stand here as a practitioner. I’ve done it before. I want to phase out the loopholes and the deductions on the individual side, phase out corporate welfare and subsidies on the corporate side, and lower the rates, make us more competitive. That’s the kind of work that is realistic. It can get done in Congress and fire the engines of growth that are so desperately needed to boost trust in this country.

UNKNOWN: Sharon Epperson?

EPPERSON: I want to turn the attention to why we’re here on this campus and what many students are very interested in, and that is the fact that, Congressman Paul, right now, we are looking at student loan debt that is near $1 trillion. Americans owe more on student loans right now than credit cards, and the average debt for a college senior right now is over $25,000. It’s obviously a very hot topic right here on this campus and with students across the country. Just listen to what they have to say.

[begin video clip]

UNKNOWN: Tuition rates have increased roughly three times that of inflation over the last three decades.

UNKNOWN: More students have to take out loans or forego college.

UNKNOWN: My generation is graduating with student debt levels at an unprecedented level.

[end video clip]

EPPERSON: So, Congressman Paul, you’ve already talked about the fact that you want to get rid of the Department of Education. You’ve said that you want to get rid of federal student loans. So how would you make college more accessible, more affordable for these students and students around the country?

PAUL: Well, I think you proved that the policy of student loans is a total failure. I mean, a trillion dollars of debt? [applause]

And it’s going to be dumped on the taxpayer? And what have they gotten? A poorer education and costs that have skyrocketed because of inflation, and they don’t have jobs. There’s nothing more dramatically failing than — than that program.

So, no, there’s no authority in the Constitution for the federal government to be dealing with education. We should get rid of the loan programs. We should get rid of the Department of Education and give tax credits, if you have to, to help people.

But the inflation is the big problem. It’s three times the rate that the government admits that inflation is, and that is natural and normal. When governments inflate the currency, it goes in the areas that the government gets involved in, housing, high prices, stock market, skyrocketing prices, medical care, skyrocketing, education…

EPPERSON: But how do they pay for it? How do they now pay for college, if they’re not…

PAUL: The way — the way you pay for cellphones and computers. [applause]

You have the marketplace there. There’s competition. Quality goes up. The price goes down. Can you imagine what it would have been like if the Department of Homeland Security was in charge of finding one person or one company to make the cellphones? I mean, it would have been a total disaster. So when the government gets involved in the delivery of any service — whether it’s education, medical care, or housing — they cause higher prices, lower quality, create bubbles, and they give us this mess that we’re in. That’s why we have to eventually get our — we have to wise up.

And look at where the bubbles come from. It’s from the Federal Reserve. And we should start by auditing the Fed, and then we should end the Fed. [applause]

EPPERSON: Thank you, Congressman.

Speaker Gingrich, Congressman Paul just talked about a bubble. And there are many that are concerned that, unlike other types of debt, student loan debt does not have the same type of consumer protections. It cannot be wiped out in bankruptcy by law. There’s really little way to refinance it. Are you worried about student loan debt becoming the next government bailout?

GINGRICH: You know, this is a good place to talk about the scale of change we’re about to live through. We’re at the end of the welfare state era of dependency, debt, distortion, and dishonesty.

The student loan program began when Lyndon Johnson announced it, I think, with a $15 million program. It’s an absurdity. What does it do? It expands the ability of students to stay in college longer because they don’t see the cost. It actually means they take fewer hours per semester on average. It takes longer for them to get through school. It allows them to tolerate tuitions going up absurdly. By 2014, there will be one administrator for every teacher on college campuses in the United States.

Now, let me give you a contrast that’s very startling. The College of the Ozarks is a work-study college. You cannot apply to it unless you need student aid, and they have no student aid.

You have to work 20 hours a week during the year to pay tuition and books. You work 40 hours a week during the summer to pay for room and board. Ninety-two percent of the students graduate owing no debt, the eight percent who owe debt owe $5,000 because they bought a car.

Now, that is a model so different, it will be culture shock for the students of America to learn we actually expect them to go to class, study, get out quickly, charge as little as possible, and emerge debt free by doing the right things for four years. [applause]

BARTIROMO: Governor Perry, name the top programs that you would cut in terms of long-term deficit reduction. Include Medicare, Medicaid, Social Security, and defense spending in the order you see fit.

PERRY: Well, every one of those — and by the way, that was the Department of Energy I was reaching for a while ago. [applause] So here what’s we have to look at as Americans. And it’s the entitlement programs that are eating up this huge amount of money that’s out there.

And it’s also the spending, Congressman Paul. And when you look at Medicaid, Medicare, Social Security, and those unfunded liabilities, I think are over $115 trillion just in those three programs. Those are the places where you go where you have to make the really hard decisions in this country.

BARTIROMO: So what is your order? And you didn’t mention defense spend.

PERRY: Well, obviously, Social Security is one of those where we either can go to a blended type of a program where we blend price and wages, and come up with a program, and can save billions of dollars there. But the people who are on Social Security, they need to understand something today. It’s going to be there for them.

Those that are working their way towards Social Security, we’ve made a pledge to them. Those individuals are going to have those dollars there for them.

But the young people out there, who is going to stand up for the young people in this country, those that are at the workforce today, and stand up and say, we are going to transform this program so it’s going to be there for you? I will do that. I will stand up for the young people in this country and put a program into place that will be there for them.

HARWOOD: Speaking of young people, a quick answer. Do you agree with Congressman Paul that we should kill the federal student loan program?

PERRY: I happen to think there are a substantial number of ways. As a matter of fact, I’ve called for a $10,000 graduate program —

HARWOOD: But would you kill the federal student loan program?

PERRY: I don’t think the federal government should be in the business of paying for programs and building up huge debt out there. I think we need to look at, how do you —

HARWOOD: So get rid of it?

PERRY: — force these universities to be efficient? And one of the ways is that the governors who appoint the trustees, they step in and they basically say, listen, you are going to have graduation rates that are moving upwards, you’re going to have tuition that is moving down. You have to have control over those boards of regents, of that’s how you do that, or the legislature has to have control.

But the bottom line is, we have to put powerful economic forces into place. And one of those is using our technology —

HARWOOD: Thank you, Governor.

PERRY: — to be able to let our kids have the opportunity to get an education through long distance learning, for instance.

BARTIROMO: That’s time.

HARWOOD: Thank you, Governor.

BARTIROMO: We’re going to take one more quick break. When we return, final questions to the candidates.

HARWOOD: Our CNBC’s Republican Presidential Debate will be right back. [applause]

[commercial break]

BARTIROMO: Welcome back to CNBC’s “Republican Presidential Debate.”

HARWOOD: Mr. Cain, let me ask you a question, under a Republican governor, the state of California hired a company in China to build major portions in the new San Francisco-Oakland Bay Bridge, creating thousands of jobs in China. And California did that because it was cheaper. Is that smart, purchasing by government in a global economy, or is there something wrong with that?

CAIN: There’s something wrong that, which is why I have proposed a bold plan, 999… [laughter] … and allow me to explain how on the 999 that that company would be more inclined to keep the business here. On the first 9, you take sales minus purchases, net exports, and capital, it levels the playing field between goods produced here in the United States and the rest of the world.

It makes the United States much more competitive and businesses won’t be tempted to build overseas and send jobs overseas. The tax code is what sends jobs overseas. The tax code is what caused them to buy the articles from the Chinese. It starts with replacing the tax code.

HARWOOD: Governor Romney, was it a mistake for Governor Schwarzenegger to hire the firm in China to build portions of that bridge?

ROMNEY: Well, that’s a — a long answer to that, because what China is doing is not playing fairly by the rules that exist in our — in the WTO and the world. China is, on almost every dimension, cheating. And we’ve got to recognize that. It is good for America… [applause]

ROMNEY: It is good for America to have free trade. It is good for us to be able to send our goods and services around the word and vice versa.

HARWOOD: So a good decision to build the bridge over there?

ROMNEY: That is normally a good thing. But China is playing by different rules. One, they are stealing intellectual property. Number two, they’re hacking into our computer systems, both government and corporate. And they are stealing, by virtue of that as well, from us.

And finally, they are manipulating their currency, and by doing so, holding down the price of Chinese goods, and making sure their products are artificially low-priced. It’s predatory pricing, it’s killing jobs in America.

If I’m president of the United States, I’m making it very clear, I love free trade. I want to open markets to free trade. But I will crack down on cheaters like China. They simply cannot continue to steal our jobs. [applause]

BARTIROMO: But how do you crack down? How do you crack down, Governor? Are you talking about new tariffs? How are you cracking down?

ROMNEY: I’m sorry, pardon?

BARTIROMO: How would you crack down on China?

ROMNEY: Well, number one, I would do something this president should have done a long time ago, which is to label China a currency manipulator. And then I would bring in action at the WTO level, charging them with being a currency manipulator.

Number three, where they have stolen intellectual property, where they have hacked into computers, and where their artificial pricing is causing their goods to have predatory levels of pricing, I would apply, if necessary, tariffs to make sure that they understand we are willing to play at a level playing field.

We want — we have to have free trade. That’s essential for the functioning of a strong economy. But we cannot allow one nation to continue to flaunt the rules and kill our jobs by allowing them continue as they have. [applause]

BARTIROMO: Speaker, in addition to that, so many companies — multinational companies, want to try to get a foothold in China and sell to the billion-and-a-half people there. They can only do joint ventures. They’re not getting a fair shake in terms of selling to that 1.5 billion person population. How would you move the needle?

GINGRICH: Well, there are two things here. And let me say in advance that I would yield in part to Governor Huntsman, because he speaks fluent Chinese, he has worked in China, and he’s been the ambassador. And I’d be curious to get his reaction.

But there are two different parts here. The problem with building the bridge is simple. What — what is it about American regulations, American taxation, American labor cost and attitudes that makes it cheaper to go to China than to go to the United States? Now, we… [applause] … first of all, you’ve got to decide, how are we going to be more competitive and how are we going to be the lowest cost? And there’s a new Boston consultant (ph) that says, by 2015, South Carolina and Alabama will be cheaper than the Chinese coastal provinces to manufacturing.

Second, in terms of dealing with China strategically, I think we’re going to have to find ways to dramatically raise the pain level for the Chinese cheating, both in the hacking side, but also on the stealing and intellectual property side. And I don’t think anybody today has a particularly good strategy for doing that.

BARTIROMO: Time. Thirty seconds. Jon Huntsman, you were the ambassador to China, 30 seconds to respond.

HUNTSMAN: Thirty seconds? For Heaven’s sake. Let me just say that we’ve had a 40-year relationship with China. It’s a — it’s a troublesome and problematic relationship, very, very complicated.

But the bottom line is, I mean, you can give applause lines and you can kind of pander here and there. You start a trade war if you start slapping tariffs randomly on Chinese products based upon currency manipulation. That’s not a good idea.

But longer term, we’re just going to have to keep doing business the way we’ve always done, is sit down, you find solutions to the problems, and you move forward. It isn’t easy. It isn’t glamorous. It’s grinding it out the way we’ve done for 40 years. And for 40 more years, we’re going to have to do it the same way.

HARWOOD: Are you saying Governor Romney’s pandering?

HUNTSMAN: I’m saying that you can throw out applause lines and you can say that you’re going to slap on tariffs. You know, that doesn’t work… [crosstalk]

HARWOOD: But you’re suggesting it. He’s standing right here. Would you say that he’s pandering on this issue?

HUNTSMAN: Well, I’ve said it before. I think that — that that policy is one of simply pandering, just throwing a tariff on for the sake of an artificially valued currency, which is, in fact, the case.

But here’s what they do in response. They say, you have an artificially valued currency, too, with those quantitative easing programs. You, too, are manipulating you’re — and we’re going to slap something on your products. And before long, you have a trade war.

But let me tell you longer… [applause]

HARWOOD: Governor Romney, are you pandering?

ROMNEY: Look, I’ve been in business all my life, 25 years. I consulted to businesses around the world. I’ve been in business where we competed around the world. I understand free trade; I like free trade. I know that America can compete with anyone in the world. Newt is right about — about our capacity to manufacture and compete heads-on versus the Chinese.

But I’ve also seen predatory pricing. I’ve seen people price their goods at an artificial level for an extended period of time, such that they can drive other people out of business. And then when the other people are out of business, they can raise their prices. That’s what China’s doing, by holding down the value of their currency.

Let the currencies float. If the U.S. currency, for instance, is being inflated, let it float. Let us float. Let us have a market mechanism determine the value of our respective currencies, as opposed to the Chinese government continuing to put an advantage to their — their producers. This — this is no longer a time for us just to sit back and say we’re going to let them steal our jobs.

BARTIROMO: Congresswoman Bachmann, weigh in here. How do you open the markets in China for American companies?

BACHMANN: Well, the Chinese have been bad actors. Recently we found out that they dumped counterfeit computer chips here in the United States. We’re using some of those counterfeit computer chips in the Pentagon in some of our weapons systems. This has national security implications.

We also found out that the Chinese just finished building 3,000 miles of underground tunnels where they are housing some nuclear weapons. There’s some very real consequences to the United States overspending to such an extent that we’re in hock to them over a trillion dollars.

We’ve sent so much interest money over to the Chinese to pay our debts off that we effectively built their aircraft carrier. And by 2015, we will be sending so much interest money over, we will be paying for the entire People’s Liberation Army of China, the number- one employer of the — of the world.

What we need to do is stop enriching China with our money. And we do that by stop borrowing from them, by stop spending money that we don’t have. [applause]

CRAMER: Mr. Cain, I want to go to you with this question. This does not lend itself to 9-9-9 or any other number.

CAIN: Sorry, I didn’t hear the first part.

CRAMER: This question does not lend itself to 9-9-9 or any other thing. This is our final word, OK? And it comes from our viewers. And it is all about restoring trust and faith in our markets and in our way of life. I’m going to be quoting Joanne Kornbly (ph). She e- mails us.

She says, “Our stock market has turned into a casino with high- frequency computerized trading comprising 70 percent of all transactions and hedge fund speculation resulting in market swings. Before privatizing Social Security, how would you make the stock market safer for individual investors?

And Mr. Cain, just simple, how do we restore faith in the markets for the little guy?

CAIN: The first thing we do is restore faith in business by providing certainty so businesses can grow. A lot of the volatility is being driven by uncertainty.

Businesses are uncertain about what the health care rules are going to be, they don’t know what the tax rules are going to be. All of the uncertainty has this economy stagnated.

So, the way you restore that, grow this economy. That’s job one.

Many of the things we talked about up here today starts with growing the economy. And that’s why we have got to use a bold plan — I won’t mention it — in order to grow the economy. [laughter]

CRAMER: When the economy was going great, sir, there was no trust. When the economy was going great, people were getting ripped off and there was insider trading. When the economy was going great, people were getting hurt in the stock market.

Forget the economy. Talk about the way the market is regulated.

CAIN: Jim, I feel your pain. Look, here is what I’m saying.

CRAMER: How about the 90 million people that got — [crosstalk]

CAIN: Jim, you’ve got to provide certainty in this environment so businesses will grow. They have been in a mode of survive. They need to be in a mode of growth. That’s where we have got to do first.

And I agree with some of the others who have said we have got to repeal Dodd/Frank. There’s three big things wrong with Dodd/Frank, which is why it needs to be a top priority to repeal.

Number one, it doesn’t provide oversight for Fannie Mae and Freddie Mac. And we all agree that that was a catalyst for the meltdown in 2008.

The two other biggest problems with Dodd/Frank, Dodd and Frank. [applause]

BARTIROMO: Governor Perry, same question to you. The same question to you and Congressman Ron Paul.

How do you restore faith in the public markets?

PERRY: Well, we have the regulations in place, and we had the regulations in place well before the meltdowns occurred. We have a culture in Washington, D.C., where these corporate lobbyists have these cozy relationships with the people that they are regulating. And we have to have leadership in this country that not only recognizes that, but demands that those individuals who are working for us are in those agencies, whether it’s in the stock market or whether it’s Fannie Mae or Freddie Mac.

And when there are individuals who are breaking the laws, who are pushing the bounds, that there are clear efforts that are made to take those people either out of those jobs or prosecute them for criminality. One of the two, that has to happen.

And you can pass legislation like you said until the world looks level. But you have got to have men and women who are committed to the laws of this country and a president that will push his administration to make sure that they’re done.

HARWOOD: Congressman Paul, Governor Perry was just talking about the culture of Washington. His critics in the state of Texas — you’re a congressman from Texas — say crony capitalism is what he practices as governor. Are they right?

PAUL: I haven’t analyzed it enough to call him a crony or not. So, no, I don’t know the details of that. But there is a lot of crony capitalism going on in this country.

And that has to be distinguished from real capitalism, because this occupation stuff on Wall Street, if you’re going after crony capitalism, I’m all for it. And those are the people who benefit from contracts from government, benefits from the Federal Reserve, benefits from all of the bailouts. They don’t deserve compassion, they deserve taxation, or they don’t — they deserve to have all their benefits removed. But crony capitalism isn’t when somebody makes money and they produce a product. That is very important. We have to distinguish the two.

And unfortunately, I think some people mix that. But this, to me, is so vital, that we recognize what crony — what capitalism is versus crony capitalism. And believe me, when you have an inflationary environment, and all this speculation, and all the bailouts due to monetary system, believe me, you get a majority of crony capitalism, and that’s why we’re facing this crisis today.

BARTIROMO: We want to thank all of you tonight. That is all the time we have for CNBC’s Republican Presidential Debate.

We thank all the candidates for being here tonight and spending the time and putting their plans forward.

We hope you now have a better understanding of where each of them stand on the economy, jobs, and your money.

HARWOOD: We would also like to thank our partners, the Michigan Republican Party, and all of the Grizzlies of Oakland University. [applause]