CNBC's Harwood Wonders if Obama Will Use Shutdown to 'Break the Fever' in GOP

In an exclusive interview with President Obama on Wednesday, CNBC chief Washington correspondent John Harwood lobbed this softball on the political fallout of the government shutdown: "Before the election last year, you said you thought there was a possibility your re-election would break the fever within the Republican Party. Didn't happen. Do you see this moment as a chance, through this political confrontation, to break the fever now?" [Listen to the audio [1]]

After the President proceeded to blame Republicans in Congress for the shutdown, Harwood actually challenged Obama on his attacks on the GOP: "I wonder about your tone lately. I have heard from you an increasing amount of exasperation, an edge, even mockery sometimes....And it gives the impression that you think that your Republican opponents are either craven or stupid or nuts. Is that what you think? And if you think so, does it help your cause to let people see that out loud?"

The President laughably replied: "John, I think it's fair to say that during the course of my presidency, I have bent over backwards to work with the Republican Party. And have purposely kept my rhetoric down." Harwood failed to push back against that absurd assertion.

Harwood later teed up the President to go after Republicans again: "...the U.S. government bailed out Wall Street firms whose issues had caused big problems for the country. Is this now an opportunity for you to ask Wall Street bankers to help save Washington from its misbehavior and put pressure on Congress?"

Obama responded with another statement that failed to pass the laugh test: "Well, again, John, I have to say this. This is not a problem of Congress, per se. This is a problem with a particular faction in the Republican Party. Democrats are acting responsibly at this point."

Following the interview, Harwood reiterated to the panel on CNBC's Closing Bell: "The President said, need to break the fever now that is allowing a faction within the Republican Party to control what the House is doing, and therefore, what the government is able to do."  

He later declared: "It is not reasonable for Republicans to expect the President to undercut, destroy his health care plan in a negotiation of this kind. That is out of bounds. And to say the President is not negotiating on that, that's perfectly expected. Any president would do that."

Here is a full transcript of Harwood's questions to Obama in the October 2 interview:

4:03PM ET

JOHN HARWOOD: In 90 minutes, Speaker Boehner and the bipartisan congressional leadership is going to be here at the White House to meet with President Obama. I asked what he was prepared to negotiate with him on and when.

(...)

BARACK OBAMA: As soon as we get a clean piece of legislation that reopens the government, and there is a majority for that right now in the House of Representatives-

HARWOOD: No negotiation until after that?

(...)

HARWOOD: An aide to the Speaker yesterday, when I asked him, where can this get resolved, ultimately said in a budget negotiation, maybe involving replacement of sequester cuts with entitlement cuts. If you get to that discussion, is it conceivable – are there any circumstances under which you could make a budget deal with Republicans that does not involve new taxes?

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HARWOOD: Is there any deal you could accept, even a small deal, that does not involve revenue, which is the problem on the Republican side?

OBAMA: Well, I think we have to distinguish between income tax hikes, which they've always been adverse to-

HARWOOD: You mean loopholes, too? No revenue?  

OBAMA: Well, I think that we're gonna have to close some loopholes in order to pay for those things that are gonna help us grow.

(...)

HARWOOD: Before the election last year, you said you thought there was a possibility your re-election would break the fever within the Republican Party. Didn't happen. Do you see this moment as a chance, through this political confrontation, to break the fever now?

(...)

HARWOOD: As you try to appeal to those other Republicans you think you could work with, I wonder about your tone lately. I have heard from you an increasing amount of exasperation, an edge, even mockery sometimes. You said one time recently, "I keep hoping a light bulb goes off." And it gives the impression that you think that your Republican opponents are either craven or stupid or nuts. Is that what you think? And if you think so, does it help your cause to let people see that out loud?

OBAMA: John, I think it's fair to say that during the course of my presidency, I have bent over backwards to work with the Republican Party. And have purposely kept my rhetoric down.

(...)

HARWOOD: You mentioned calm. Wall Street's been pretty calm about this. The reaction, I would say generally speaking, has been Washington fighting, Washington posturing, yadda, yadda, yadda. Is that the right way for them to look at it?

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OBAMA: One thing that I often hear is, "Well, Mr. President, even if they're being unreasonable, why can't you just go ahead and do something that makes them happy now?" And I have to remind people-

HARWOOD: Or the constitutional option.

(...)

HARWOOD: Four years ago, at the beginning of your presidency, the U.S. government bailed out Wall Street firms whose issues had caused big problems for the country. Is this now an opportunity for you to ask Wall Street bankers to help save Washington from its misbehavior and put pressure on Congress?

OBAMA: Well, again, John, I have to say this. This is not a problem of Congress, per se. This is a problem with a particular faction in the Republican Party. Democrats are acting responsibly at this point.

(...)

HARWOOD: Can these Wall Street guys influence those people?

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HARWOOD: Any awkwardness around having Jamie Dimon in and asking him to help with that effort at the same time he's been in discussions with your attorney general about his bank's legal issues?

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HARWOOD: You told me as you were about to take office in 2009 that you were gonna try to stay focused on the big picture. Not watch the stock ticker at the bottom of our screen. Are you gonna watch that ticker over the next couple of weeks to see what the market impacts are as we get closer and closer to October 17th?

(...)

HARWOOD: I was looking at poll data on the health care law the other day. Very, very popular among African-Americans. Marginally popular among Hispanics. Very unpopular among whites. What are the implications for the country, on this issue and many others, in our elections and legislatively, of a politics that are polarized not just by party, but by race?

(...)

HARWOOD: Very quickly. Does the shutdown at all affect the vetting of your potential Fed nominee, slow that down? A lot of people have said, why is he taking so long on that appointment?

(...)

HARWOOD: Last question. Pope Francis said the other day that the Catholic Church – without changing the Church's positions – he said it had become too obsessed on issues like gay rights and abortion. What did you think of the Pope's remarks? And do you see any broader applicability beyond the Catholic Church?

(...)

HARWOOD: I think, guys, the most significant thing that came out of that very long interview was that the President is saying, "Yes, I will talk to congressional leaders, but we're not going to negotiate until after they pass a clean CR, get the government back open." And that's going to be difficult for the Republicans. But the President said, need to break the fever now that is allowing a faction within the Republican Party to control what the House is doing, and therefore, what the government is able to do.

(...)

HARWOOD: He has taken the stance that he's going to make John Boehner put a bill on the floor that passes, that reopens the government, or at least get the hardliners within his caucus to agree to that. And if we don't, this is going to keep going and is going to get right rolled up into the debt limit.

(...)

HARWOOD: It is not reasonable for Republicans to expect the President to undercut, destroy his health care plan in a negotiation of this kind. That is out of bounds. And to say the President is not negotiating on that, that's perfectly expected. Any president would do that.

What is reasonable to expect is that if we get into an actual budget negotiation, which we seem to be moving toward, that the President will engage in give and take. So, that's the negotiation that counts.

And the question is, how do we get there? And the President has a little barrier there on this clean CR. He's not going to do any of the negotiating. It may take longer than that anyway. But the idea of a temporary CR is to give time for that negotiation. Maybe one way out of it is a shorter term – shorter duration CR that kicks those budget negotiations into gear.

(...)