President Obama's State of the Nation Address tonight; Interview With White House Press Secretary Jay Carney
BLITZER: President Obama has a lot riding on his "State of the Union" address tonight. It's a major speech he can't afford to get wrong. He's no doubt been working on it for a long time. Today, the White House released a video showing some of the help he's getting behind-the-scenes.</s>UNIDENTIFIED MALE: We are one week away from the "State of the Union", finished the first draft, first complete draft last night and on Monday night. And now, we're going to meet with the president. He read the draft last night. He made a lot of edits. I saw his draft when I went up there this morning. And, now, we're going to talk to him about it, hopefully, in the half hour.</s>UNIDENTIFIED MALE: The thing about President Obama, which I guess is this is simply not an editing exercise. He's involved from conception through kind of development process, and then, you know, he writes a lot of the speech himself.</s>BLITZER: Republicans meanwhile, have their own very different view of the current "State of the Union" revealed in this new ad.</s>BARACK OBAMA, PRESIDENT OF THE UNITED STATES: If I don't have this done in three years, then there's going to be a one-term proposition.</s>UNIDENTIFIED MALE: Here we are four years later --</s>UNIDENTIFIED MALE: And they can't find a job. Why should they support him?</s>UNIDENTIFIED MALE: The economy with 13 million people out of work. Four million people out of work for more than a year.</s>BILL CLINTON, FORMER PRESIDENT OF THE UNITED STATES: Forty-nine million Americans living below the poverty line.</s>UNIDENTIFIED MALE: Undue influence by Obama campaign supporters.</s>CLINTON: Things are not going in the right direction. They're going in the wrong direction.</s>BLITZER: Tough words in that Republican ad. Let's go to the White House. The press secretary, Jay Carney, is joining us right now. Jay, thanks very much for coming in. How much of the president's speech tonight is substantive, policy-oriented, how much is political in this political re-election year?</s>JAY CARNEY, WHITE HOUSE PRESS SECRETARY: Well, contrary to, I guess, some of the expectations that have been laid out there that this would be a political speech, this is a traditional "State of the Union" address. The president will assess for the American public and his listeners in Congress where the country is, the "State of the Union", if you will, and where he believes we need to take it, working together to grow the economy, to have it create even more jobs. After 22 straight months of creating private sector jobs, we have more work to do. And he's going to talk about -- he's going to lay out a blueprint for an American economy that's built to last, not built on housing bubbles or financial sector bubbles or internet bubbles, but on American manufacturing, on American energy, on skills for American workers, and on renewal of American values. So, this will be a very substantive, policy-oriented speech that will also be encapsulated in a vision for where this country needs to be moving so that it can dominate economically the 21st century the way it did the 20th.</s>BLITZER: How will the president describe the "State of the Union"?</s>CARNEY: The president will say that the "State of the Union" is getting better. The fact of the matter is that you and I, Wolf, even though we've been around for a while, the economic recession that we saw happened in this country in 2008 was worst of our lifetimes. And then, for most Americans, that's the case. It was the worst recession since the great depression. When President Obama was sworn into office in January of 2009, the economy was shedding nearly 800,000 jobs per month. We now know that in the fourth quarter of 2008, the last quarter of the previous administration, the economy shrank by nearly nine percent. I mea, we haven't seen numbers like that since the great depression. This was a deep, deep hole. And, the facts are, contrary to that ad that you just played, since President Obama's tough policy decisions have been allowed to take effect, the economy has reversed itself. It's begun growing. That has begun creating jobs. More private sector jobs were created last year in the United States than any year since 2005. We're headed in the right direction. We have a lot more work to do.</s>BLITZER: How do you explain that the president tomorrow goes on this three-day trip to several battleground states, states he'll need if he's going to be re-elected like Arizona, Nevada, Colorado, Michigan. What's the theory behind that?</s>CARNEY: Well, the president will travel all over the country to talk about the policy initiatives that he'll begin to lay out tonight in the "State of the Union" address. In many ways, the speech tonight will be a bookend to a speech he gave, laying out some themes about how he views America's economic future that he gave in Osawatomie, Kansas. I don't think, while a lot of states are in play in American presidential politics, I don't think you can argue that Kansas is a battleground state. He'll travel all over the country to blue states, red states, and purple states, arguing for the kinds of policy initiatives that he's going to put forward tonight.</s>BLITZER: When he hears that Newt Gingrich, the Republican presidential candidate, the former speaker of the House called him the best food stamp president ever, what does he think about that?</s>CARNEY: You know, I think that he understands that there's a lot of bluster and empty rhetoric in the political process. The other party is engaged in what looks like might be a long primary battle. This president has the support in his party that means he doesn't have a challenge. He doesn't have a contest in his primary. That allows him to focus even more intensely on the job he was elected to do, which is to move this country forward, to grow the economy, to create jobs, to build an economy here that's durable and will last. So, he's focused on his job, you know, the politics that's going on in the Republican primary process will take care of itself, will sort itself out eventually there'll be a nominee. And, President Obama will be ready to engage in debate with that nominee when he emerges.</s>BLITZER: Mitt Romney released his income tax returns for the last two years. He made more than $40 million. He wound up paying about 14 percent, though, in taxes. Fourteen percent, obviously, a lot less than 35 percent, but it's all legal because it was dividends, interest, long-term capital gains. Under your vision, what would he have paid for those kinds of investments?</s>CARNEY: Well, the president has spoken in the past about the Buffett rule. He'll speak about it again tonight. This is the principle laid forward by Warren Buffett, a very well-known billionaire in this country, who believes very strongly that he should not be paying taxes at a lower rate than his secretary. That Americans who are fortunate enough to have benefited from this great economy and country of ours, to be millionaires and billionaires, should not be paying less in taxes at a lower rate than working in middle class Americans. The president will speak about that principle that will guide tax reform for him, again, in more detail this evening. I think you may have heard already, Wolf, that Warren Buffett's secretary, the embodiment of the rule that Mr. Buffett describes, will be joining the first lady in her box tonight to witness the president give the State of the Union Address. This is a very important principle, because we need an economy that's built to last. We need an economy where everyone gets a fair shot, everyone does his fair share, and everyone plays by the same set of rules. That means Wall Street and Main Street playing by the same set of rules. Those are principles that the president believes very strongly the vast majority of Americans share and believe should guide us as we devise an economic policy that will allow America to compete and win in the 21st century.</s>BLITZER: So will the president propose increasing the tax rates for capital gains, dividends, interest?</s>CARNEY: Well, he won't get into specific tax reform proposals or lay out a specific tax reform plan. The principle of the Buffett rule, he will say tonight, will guide the tax reform that he believes needs to be done on the individual tax side. And he will put a little more detail in what that means in practice. The overall principle here is, however you get to it, and the individual forms that people pay taxes, that, again, somebody making $1 million or $10 million or $250 million or $40 million should not be paying a lower tax rate than people making $75,000 or $60,000 or $100,000. That's just -- it's not fair, especially when we need to be able to pay for our national defense and to be able to make sure that we build the right infrastructure for this country, invest in education, invest in energy. These are high priorities for our country, and we need to make sure that everybody is doing their fair share so this country can grow in a way that everyone gets -- or that most people possible gets a real fair shake and a real opportunity.</s>BLITZER: But I just want to be precise. On the dividends and the interest, capital gains, you want that to be taxed like earned income, 35 percent right now? You'd like that to go up to 39 percent, which is --</s>CARNEY: No, no, we're not proposing that. We're not proposing specifics for tax reform, because each individual, because of the complications in our tax code, who might be a millionaire or billionaire and pay a tax rate of 15 percent, say, or 17 percent, or lower, as Warren Buffett stated, than a working or middle class American, you know, may get to that rate for different reasons. The overlay principle will be that millionaires and billionaires should not pay a lower effective tax rate than working class and middle class Americans. The president will be more specific about that, but he will not lay out the specific rates for capital gains or dividends. He'll lay out the principle.</s>BLITZER: We'll be listening very closely. Jay Carney, the White House press secretary. Thanks very much for coming in.</s>CARNEY: Wolf, always good to be with you. Thanks.</s>BLITZER: The president's speech later tonight. We'll have live coverage, of course, here on CNN. Meanwhile, other important news we're following, including a scene of utter devastation near Birmingham, Alabama, after a powerful tornado. You're taking a look at live pictures right now of what looks like a war zone. One family's loss makes the physical damage though pale in comparison. We're going there next. And a giant similar storm reaching Earth. You're going to find out why it's forcing a major airline to make some big changes.