there beneath you. >> all right. well, thanks for watching today. >> "state of the union" with candy crowley starts now. flue year, old troubles. health insurance in the balance and at economy on the mend. >> i'll optimistic for the year ahead. your health care, your money, a conversation with gene sperling, director of the national economic counsel. then circumstance the one? >> the answers aren't going to come from washington. prouben governors are going to drive america's come back. >> he took on public unions and became the only governor in history to survive a recall election. wisconsin's scott walker is the first in our series on the republican party's search for itself. plus, same-sex mar arrange

and faith versus obama care, back at the supreme court. an explainer with court watcher joan business coupic. , ready set, go, our panel ponderses the deciding issues in poll thinks year. 302 days until the midterms. this is "state of the union". good morning from washington, i'll candy crowley. democrats on capitol hill have lost a full-court press for an extension of long-term unemployment benefits which expired last month. the senate takes up the measure tomorrow. the bill provides relief to the jobless for up to 73 weeks. it's not certain to pass but democrats are certain the politics of the issue favor their party this election year. joining me is the man leading the push to restore the emergency aid, a key economic adviser to the president, gene sperling. gene, thanks for being here. >> thanks for having us. >> let me -- let's start out with unemployment benefits. some republicans say, hey, we're

open to in, but it needs to be paid for. others say it just encourages people to stay on unemployment till their benefits run out and then they go look for a job. and others say i wait a second, the economy is improving, this was emergency aid for the height of the recession and we don't need it anymore. so why do you think we have to have it? >> you know, it is true that the economy is improving, showing more momentum. unemployment rate, in general, is falling. but what we're finding is the worst legacy of the great recession a crisis of long-term unemployment, people who have been unemployed for six months or longer are finding it most difficult and we have to be a country that's committed to leaving nobody behind in this recovery. and so, that requires a full-court press it does require more bipartisan effort to create jobs. it requires the president's partnership. he is working on the cos to give

more of those long-term unemployed a chance to get intervund hired. >> part of an overall strategy? >> it is. but we as a country, have never, never the last half century, have we ever cut off emergency unemployment benefits when long-term employment has been this high. never before. and so, you know, people have to remember that long-term -- that emergency unemployment benefits only go to people who are actively looking for a job. for a lot of people, that keeps them encourages them to keep looking when they are getting discure rammed. and i have to point out that tomorrow is actually the day that 1.3 million americans will go to their mailbox and find that check missing that check that they rely on to put food on their table -- >> a lot of people say, well, wow, 73 months that's close to a year and a half you can get in some people, not everybody gets that much, long term or not. when do you say okay, it's good now? >> no i think what people should clearly understand, first, as i

said, you have to be actively looking for a job to get this. >> that's paperwork, gene. you no that he's paperwork. plenty of people on long-term unemployment that, you know, can game the system. most of them do not and we understand that. >> most of the people are desperately looking for jobs. >> right. >> our economy still has three people looking for every job, you know, we saw thousands of people looking for just a few hundred jobs here in detroit when walmart put up ads. and i think if you look at why is there a bipartisan proposal now, why did senator heller, a conservative republicans from nevada, support this? >> because unemployment is really my nevada. >> he is out there talking to constituents who desperately want to work. but let me answer your question, because it's an important one. people need to understand that emergency unemployment naturally tapers off. in other words, as your state goes below 9%, those weeks go down. as your state goes below 7%, it goes down. and my hope would be is we will

start getting near the more normal levels of unemployment, where we can cut this off. >> what's normal? >> i think as your approaching 6% nationally. >> so 6% would be around the time would you think, okay, long-term unemployment benefits no longer needed? and yet, the president in his radio talk, more than radio nonetheless in his saturday talk, said that it's cruel to cut long-term unemployed out of these benefits there will still be long-term unemployed, unemployment hit 6% is it less cruel at 6% than it is at 7%? >> i think that we -- i think what we know now is that, again, we have never cut off long-term unemployment -- employment ben puppets long term when unemployment has been this high and this is going to affect a lot of people, candy. over the course of this year, 14 million americans would be affected, 4.9 million who get -- would get unemployment benefits cut off in 2014 and 9 million

people that they support. so yes, i do think we as a country are going to have to take a lot of steps to deal with long-term unemployment that is the worst legacy of the great recession. yes, there is going to come a time where we are going to not need have emergency unemployment benefits but we are going to have to do more. the president has challenged ceos to work with him on making sure that the long-term unemployed are getting a fair chance to interview and hire and we are gonna need to do things on job creation. we need to -- the presidents aproposed a grand bargain for job growth. he said, let's put together lowering corporate tax -- tax rates, together with infrastructure. that's the type of grand bargain on jobs that we will also have to do, 'cause you're right, in the ends of the day, we have got to create the demand and the job growth out there that gives these people who are desperately looking for work now a job to get. >> the president has talked about this corporate tax reform coupled with some

infrastructure/job creating kind of plans. >> yes. >> the problem is that he has been unable to get it before. now, his poll ratings are lower than they've ever been. what makes you think he can get it this year? >> well, look, we are building off some bipartisan cooperation in the budget agreement. and i think one of their -- the real issues for 2014 is we have more momentum in the economy, unquestionably, in terms of growth, in terms of job creation. are we going to build on that momentum? there is bipartisan possibilities to pass, immigration graigs reform, housing finance, manufacturing. and yes, this idea of a grand bargain on jobs is designed to bring people together, snag republicans and business leaders tend to support, lowering corporate rates, eliminating loopholes, lowering them to 28% rates, 25%, simplifying the tax code for small businesses but combining it with infrastructure is a way to do things that most americans -- >> have way this year?

when he had better numbers, more public behind him, and more sway in a democratic party that has to look toward a 2014 election? how can he get it done this year when he is in a weaker position what he couldn't get done last year, the year before? >> well, i think there's no question, washington's been, you know, extremely dysfunctional. but i think you have to hope that there is desire everywhere to she people that we can work together and i think that it will be harmful, not just for the economy, but i think harmful plightcy dpli republicans use 2014 as a year to threaten, default again on the debt limit or refuse to do bipartisan immigration reform that's already passed the senate. and you know, the question is the only reason people want to work together on jobs politics or are we here to try to create jobs, strengthen the middle class, deal with inequality, have each other's back in hard times? that's our goal, what the president's going to be pushing for in the state of the union, what he is going to be pushing for all year.

>> a couple of quick questions, one on the economy. where is it headed? at the end of this year, will we be at 6% unemployment? what will the growth rate be? what do you look ahead to this year? >> well, there's no question, we have seen more momentum, we expect the second half of 2013 to see growth that's been over 3%. >> 2014. >> no i'm sake the second half of this year, growth will be over 3%. that goes in with significant momentum into 2014. you know, i don't want to do forecasts for 2014. i will say there's some very positive signs. you're seeing housing prices coming up. you're seeing 401(k)s come up, that's improving the balance sheets of average families across the country. you're seeing a lot of strength in manufacturing. you're seeing health care costs three years in a row now at the lowest rate of growth that we've seen on record. >> and -- >> these are all positive signs. the last thing i want to say is

that we're also seeing 50% of companies saying they are rethinking about bringing jobs back to the united states, a consultant firm just said that for the first time since 2001, the united states is the best place to do business. that's because we are doing more about our innovation about lower energy costs, it's about lower health care costs and those were all promising signs but ultimately, candy, it's going to depend what do we do with that moment up? do we work together in some of the ways we talked about? past minimum wage, increase minimum wage? do immigration reform? housing finance reform? manufacturing? these are things that will make a big difference in how much momentum the economy will have in 2014. >> gene sperling, thank you for joining us this morning much appreciate it. >> thank you. when we return, republican governor scott walker on obama care, how he would fix washington and whether he wants a chance to try. >> across the nation, you see in the states, governors showing that we can make things work, particularly if you're a republican governor. i quit smoking. i've quit for 75 days.

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during his first year in office, republican governor scott walker faced down public unions during a budget battle. it made him a darling of conservatives and a target for democrats. his second year, walker became the first governor to survive a recall election. that triumph cemented him as a headline player in the republican party and an often mentioned possibility for a 2016 presidential run. adding to that chatter, his new book, "unintimidated, a governor's story and a nation's challenge." joining me now, wisconsin governor scott walker, who is in his fourth year in office and running for re-election for governor. so you have been a busy guy over the past four years. we appreciate your joining us, governor. >> good to be with you. thanks for having me on. >> let me start with that book, because, you know, the fact is, i think you know and i know and

most people who cover politics know that a book is almost mandatory for a presidential run. you got lay out where you are and set out some beliefs, et cetera, et cetera. why did you write it? >> in our case, it's pretty unique. people want to know about my biography, how i became an eagle scout, what sports i did as a kid, they will be disappointed because this is really a book about the reforms we did in wisconsin, what we did, how we did it, most importantly i why we did it and at the end, a reaction how it can apply to other states and our nation's capital. we went through some pretty big attentioner any 2011. the recall was the first ever where a governor was successful and i think people wanted to know what, where and why. and we have been successful getting that out. and i hope actually more than just conservatives and republicans a lot of undecided voters in my state and across the country read it, because i think they will be surprised to see what they weren't seeing throughout the debate. >> as you know, 2014 is generally the time when pundits

and people very involved in politics begin to speculate about the next presidential election. we put together a list of the most often mentioned names on the republican side, chris christie, rand paul, paul ryan, ted cruz, marco rubio, rick perry, jeb bush, scott walker. should your name stay on that list? >> well, i'm focused on 2014, not just because i'm up for election, which isn't a given, but when i look what the we did in wisconsin, as i mentioned in the book, many of the states across the midwest where they change changed not only governors 2010 but the legislative bodies as well, real reforms happen in a number of these battleground states because a whole new team came in. and i think 2014's incredibly important nationally i not just the whole united states house of representatives but to win the united states senate back if do you that then two years later, there's a new president, he or she can ultimately have a team that can come in and push true reform and that's what we've done in the key states likewise which is, we can do for america. so i'm really focused on 2014, not getting ahead of the game.

>> sure, but we wouldn't be wrong to deep your name on that list? >> well, you guys -- you guys predict all you want. in the end, we are going to stay focused on getting things done that's what governor does, focus own getting things done, not just talking about it. >> let me ask about a couple things that came up in my interview with gene sperling, two issues this will dominate at least the early months of capitol hill that is, first, the extension of long-term unemployment benefits. basically, for people who have been unemployed for six months or more. in the states, they can get up to a combined state and federal unemployment benefits, they could get up to 73 weeks, close to a year and a half. where do you stand on that? >> well two things, one, let's be clear, the reason why the white house is so actively pushing this is they want to desperately talk about anything but obama care. the best thing quo do to help people employed or underemployed is fix obamacare, replace it

with a parent-centered plan that put people in charge, not government in charge and got rid of the uncertainty so many businesses in my state and i cross the country talk about. but two, the spiffic benefits to me, any discussion about should be focused on what sort of reforms are we going to put in place? he talked earlier, the previous segment, about people looking for work. well, the federal government doesn't require a lot. we just made a change last year so that people had to look five times or more a week for work without our requirement change, who do go as little as two times a week. i don't know about you, candy, if i was out of work, i would be looking for man-than-twice a week for a job, every day except today, take sunday off to go to church and pray could i find a job on monday, but i think there need to be reforms in that system and wisconsin is one of the few states in america that just changed things so that adults without kids looking for work now have to be enrolled in one of our employment training programs. a couple weeks ago, with he saw there were more than 50,000 people in one of our websites here in the state, or 50,000 jobs, i should say open on one

of our websites, one of the biggest challenges people have who are employed or unemployed, many don't have the skills in advanced manufacturing, health care and i.t. where the jobs r instead of talking about extending benefits, we should talk about getting people the training they need to fill those jobs, much better off than just putting a check out. >> so you don't, per say have a problem with extending unemployment benefits for the long-term unemploy bud like it coupled with some other things? >> yeah, that's what we did with our food stamp program. we said, if you want it, we will help you out, but i -- i've got two boys now in college but for years, they used to play high school football as wide receivers that end would go in and out with the plays from the coach to the sidelines, from the sidelines to the quarterback. and i got to tell you through all those years watching football, i enough saw one kid get in the game who didn't have their helmet on and their gear ready. what i suggest is that whether it's unemployment compensation or food stamps or other benefits we should require employment training to so people are ready with the skills, when the job

comes, it will they are ready for the job. bhunchts increase in the minimum wage at the federal level? >> you know, again i look at that years ago, i worked at mark donald's when office kid you can paul ryan worked down the road for me in janesville, i walked in a small town. those were great jobs to start out with. my great fear, paul and i back then and my kids when they worked those sorts of jobs they would be without work. we have a high unemployment rate amongst young people. if wrerp with he were to raise that artificially we would take that away. instead, what we were focusing on, we need to find the skills to find the better paying jobs, family-supporting career-type jobs we talked about, we have them here in advanced manufacturing, welding, machining, information technology, certified nursing assistants, all sorts of great jobs out there one of the great challenge is we don't do enough and the federal government makes it hard for the states because they have all sorts of worker training programs with this bureaucratic mess it makes it very difficult to get people the training they need by getting

through that maze and we need to change that so people can get the training and get them to the jobs that pay more. artificially raising the minimum wage whether it is at the state or the federal level is not going do do that creating an environment where employers create jobs will do just that. >> if i am an unemployed american and i hear from republicans that, yeah, we should go ahead and do that provide we had do the following three things, if the a he is a caveat approval of extending those benefits or if i am a minimum wage worker or i find -- i see republicans who say, you know what it's artificial, it messes with the marketplace, it might mean some teens can't get into the job market, why would i become a republican? how do you message that in any way to reach out to those who are disinclined to sign up for the republican party? >> because in the end, what people want is freedom and opportunity. you don't get that through the

mighty hand of the government. i think as a kid when i grew up in dullivan, nobody in my class said someday, my goal is to grow up and become dependent on the government. the same for the great people i have met who have immigrated from other countries, mexico, india, any where else, all those folks i know are successful small business owners don't say to me they came here because they want to become dependent on america. no the american dream is given a chance, given an opportunity, the great thing about this country, greater than just about any country in the world, is that you have an equal opportunity but the outcome's up to you. the problem is too many americans right now don't have that equal opportunity and we should be making a case about how we're going to make it easier to create a job, easier to get in the workforce, easier to get the skills that they need to fill those jobs, artificially raise things. >> that's not an uncommon argument for many republicans that i have heard in the past saying this is about empowering people, not about, you know, raising benefits and making them dependent but it hasn't worked. what makes this expand the republican party, which

desperately needs to bring in something other than what's really been a shrinking base in your party? how do you resell that message? >> yeah. yeah. candy, well, part of it though part of the reason why it hasn't worked as well else where, a good example is reform wes put in place for food stamps this past year in wisconsin is not often was money put in place to make things happen. i say you got to put your money where your mouth s part of the reason why most states don't require childless adults to work or be employ training to get food stamps is because tough put money behind that to fund the worker, employment training program. we do just that. we put $17 million behind that in our last state budget 'cause i want to make sure people have those skills. i think when people see that, when they see that what we care is about is not just people going out and looking for work but giving them the skills, giving them opportunity. a young woman i mentioned last year named elizabeth, on her own, before we made this requirement, went out, got the training, got the experience. i wanted to invite her to my

budget adr. toes talk about it but i couldn't. not because she didn't want to be there but because she was working as a certified nursing assistant and that night, liked her job, going to backe to school to be an rn. those are the sores of stories we want to tell people across my state and across america. i think people realize that's where the real freedom and opportunitisome it is not getting a check each week, each month from the government but getting the opportunities and skills to get out and control their own lives and their own destiny. >> governor, quickly here, when republicans on capitol hill agree to a budget agreement about ever they left for the holiday recessle, speaker john boehner came out and really took on conservatives tea party-times for having an undue influence on some of his members that have blocked, famous lakers number of things that we knee speaker boehner wanted to do, what do you think the role of the tea party is in 2014 in terms of republican primaries or even

moving into the generals? are they on the rise in power or on the wane? it's hard to say not one monolithic group is that the tea party. what i have seen over the years is frustration build across my state and across the country, particularly the federal government, people thought the government had grown too big, too expansive too a part of our lives oh he 'bama care was the last sfrau a few years ago. people showed up at the congressional town hall meetings, people didn't feel like they were listened to, they took out their frustration, particularly in the 2010 election. >> right. >> i think that degree is healthy if it's focused in the right way, but one of the things i said after the budget compromise is for people who didn't like it who didn't think it was good enough, the answer is not to take it out on house republicans or in primaries, the answer is do go to kentucky -- excuse me exlouisiana, or arkansas or go to north carolina or alaska, where there are senators facing real elections as democrats and request and help in those election he is and elect new republicans to come because a year from now, things will be much different, if

republicans hold the united states senate. >> got to -- >> don't focus on the people in office. focus on those who you would like to replace. >> governor, let me ask you a final question. i know you're headed for lambeau field up in green bay. we took a look a couple minutes ago. when the game gets started, we are told it might be real temperature, minus 22 degrees there it could break the record for coldest game ever. what -- what will you be wearing to this game? >> many, many layers. in fact, bart starr won the ice bowl against the dallas cowboys about a month and a half after i was born in 1967, december 31st of that year. and nothing greater than to see us beat the san francisco 49ers, maybe freeze them out, appropriately stated, and get on our way to the next round of the playoffs but i would love to be a part of history and love to see the packers win. go, pack. >> i hear the 49ers actually are pretty good in the cold weather. but good luck to both teams. thanks so much, governor. >> as long as it's not 49 -- as long as it's not 49 degrees

below, i'm okay with that >> okay. all right. thanks so much for your time. we appreciate it. next up, should catholic nuns be forced to provide birth control for their charities' employees? it's another high-stakes legal test for obamacare. and court watcher joan business cubic is here to help us make sense of the latest challenges. [ laughter ] smoke? nah, i'm good. [ male announcer ] celebrate every win with nicoderm cq, the unique patch with time release smartcontrol technology that helps prevent the urge to smoke all day long. help prevent your cravings with nicoderm cq. open to innovation. open to ambition. open to bold ideas. that's why new york has a new plan -- dozens of tax free zones all across the state. move here, expand here, or start a new business here and pay no taxes for ten years... we're new york. if there's something that creates more jobs, and grows more businesses... we're open to it.

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joining me now, joan biskup biskupic, legal affairs correspondent for reuters and the author of several boonlgs on the courts, including "american original, the life and constitution of supreme court justice antonin scalia." thanks so much, joan, coming to decipher the court for us. beginning to remind me a little bit of roe v wade, where a law is passed and then every couple of years, it's sort of redefined around the edges. is that what we are likely to see with these two new issues to thank seem to keep cropping up, one is obamacare and the other is gay marriage? >> oh, yes. i think we are headed for several different disputes over the next couple of years in both those areas.

in fact, both of them came on the eve of 2014 to the supreme court in different fashion. and i guess guile with the contraceptive mandate first, which is a provision of the affordable care act a group of nuns in denver that provide nursing home care was protesting this part of the affordable care act that requires contraceptive coverage. they are actually exempt from it, but they have to fill out a form certifying their exemption and what they said was that on january 1st when that obligation kicked in, they did not want to sign the form. and the obama administration said you are exempt, you should to sign the form. the little sisters of the poor, which is the name of the group, came to the supreme court trying to get a stay, trying to get obamacare blocked from applying to them for this contraceptive form and right now, that's pending at the supreme court. justice sotomayor, as the justice who oversees that area

of the country could he refer the matter to the full court. the next couple of days we will see whether religious groups is to sign these forms. now this is one part of the contraceptive mandate. >> they say they don't want to because it makes them complicit in it? >> yes. yes. there are other groups that you fall under it. in fact, the supreme court has a contraceptive mandate case that it's going to hear in march that's come from a for-profit business by the name of hobby lobby, also based in the tenth circuit in oklahoma. and what that group is saying is that our business owners have religious objections to providing contraceptive coverage. that case is actually about contraceptive coverage itself. the one that's right before the justices now this emergency motion has to do with the form. the nuns say we don't want to have to even be part of it as you say, candy, complicit. the obama administration has tried to minimize the filling out of the exemption form but they say we don't want to have to do anything with it at all.

>> so, of the cases -- the other case is utah case. >> yes. yes. >> gay marriage, which appears to say can we stop gay marriage until we get a final court opinion? >> yes this one came out of the blue for a lot of people, as we all know. same-sex marriage, a lot of action across the united states. the supreme court sort of side stepped the issue last summer in the california proposition 8 case but at the same time it also ruling in another case said that same-sex people haved same rights as homosexual couples in the windsor case. and what's happened is that lower court judges are take you can the language from the supreme court last june and using it to enhance same-sex couples' rights and that's exactly what happened in utah, right before christmas a utah judge said that utah could not ban marriages between gay men and lesbians. and now, utah officials are right before the supreme court saying please block this.

wait until the merits decide. don't let gay people get married in our state. 1,000 have gotten licenses. >> hard to undo, what california proved. >> and it sends mixed signals to people in the state can they get married or not get married. . that's right now before the justices also. >> just quickly, looking at what's on the court docket, what case must we pay attention because it will have the broadest impact? >> all of them. all of them. sorry. the same-sex marriage and the contraceptive mandate ones up there right now are not up there on the merit bus campaign finance on the merits. right on january 13th when the court comes back it will hear a case having to do with presidential power over recess appointments that's important for the structure of government. we have a case involving abortion protests, we have a case involving prayer before council meetings. so lots of good culture war cases. >> come back and talk us to. >> okay. >> thank you so much, joan because cubic, appreciate it. >> thanks. with his two-week hawaiian vacation over, president obama

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we're new york. if there's something that creates more jobs, and grows more businesses... we're open to it. start a tax-free business at startup-ny.com. joining me around the table, sue rothenberg of the rothenberg political report and maddie dumpler for americans for tax reform. thanks for being here, and be glad we are not in wisconsin where it is really cold. just start with you and just give me the base of 2014 in january for the midterms. >> well, candy, where we are starting now is very different than what i've said in october in the middle of the government shutdown, but where we are now,

we are beginning the stretch really to drive hire and the president's job approval numbers are down and somewhere between 39 and 40 to the republican brand is bad. when you look at the generic ballot, the republicans' numbers have popped a bit and even even or up a couple of points. i think right now the house looks very difficult for the democrats and the senate is definitely in play. the white house is gonna have to change the dynamic, change the argument so that the election is about the republicans, republican extremism, republicans being uncompromising because right now, it looks like the election will be much more about the president, health care reform, and kind of the six-year itch. >> an all-republican congress, republican majority congress doesn't bode well for the last two years of the presidency, but i want to get you on how he changes that dynamic. i just want to back up stu on the poll numbers. first, we have a cnn/orc poll,

registered voters, choice for congress in 2014, 49% republican, 46% democrat. that is, like, so wildly different from what we saw three months ago. >> quite a pop, yeah. >> and the next one of registered voters, are you more likely to vote for a candidate who supports president obama, 40% who opposes president obama, 55%. this is a dark way for democrats to start an election year. >> well, one, polls, not a pollster, but polls on the generic horse race a year out from the race is fairly useless. there's a lot of dynamics that you are going to unfold in the next year or so. i think when you look at the house, you are right, it is a tough climb. however, given that congress is at an historic low and you have a vast majority of the americans saying this is the worst congress of the generation, congress, any member of congress is safe, i think is taking it a little bit too far. what we do know, we have 20 seat

nous where republicans sit in that obama won that dccc is going to put work hard to put in play and the grassroots level raise august lot more money than republicans now and have less retirement, one democrat retiring in the house now. democrats like their odds, punching chances at the house. >> 85% of congress is safe. don't say nobody is safe. you know the way the districts are drawn, just 85%, not competitive. the question -- the question is on these competitive races, these competitive districts, and right now the white house has to change the dynamic. midterm elections are often referenda on a president, they are very rarely referenda on the house. >> let me get maddie -- >> went directly at me. >> time in a minute. >> but the saying was true in 2006. now, i will agree with you that the way districts are gerrymandered right now makes it

impossible to see mass turnover. by the way, the reason why congress is so unpopular, congress right now does not in fact, reflect the popular will of the people. >> why the shouse interesting. look at what is happening in the senate. democrats have to be on defense and run a very proactive defense and i don't know how they do that. they have 21 seats that they need to defend and we are talking about what's happened the past couple of months and what's happened the past couple of months is at least that republicans and conservatives have been consistent talking about what they don't like about washington. and democrats right now don't have much to defend about what's happening in washington. you don't have democrats out in front saying they are going to run, talking about obama care and obamacare and you were talk to governor walker earlier out in the states, democrats don't really have a model to follow them don't really have leaders this state level who have proactive policy victories that they want to be talking about. first the republican side, you have senators out here who have really set the stage for them. you have got governor walker who has pulled wisconsin back from the brink of bankruptcy and

disclaimer, i'm from which is, which i have been following that quite closely and glad i'm no long terror for that game today. but also looking at north carolina, which is going to be a really tough senate race. governor mccorey there done wildly popular tax reform and going to set the stage for senate candidates across the nation. >> i've heard this before about democrats are down, democrats are down. haired heard a couple months ago in virginia, quite frankly, president's poll numbers weren't great, democrats didn't have anything to say, you know what democrats did, they won every statewide race in the state. you know why? on the boosks a more diverse electorate, not supposed to turn out in an off year and they did turn out. >> let me ask, you because i do think the turnout, as we say, every election is really like who gets their people out, if you have issues like minimum wage and if you have issues like long-term unemployment and if the issues are seen as blocking those, that is quite likely to

get the democratic base. >> except -- that's true. except this, that this election is not about some broad republican theme. it might be, but it doesn't look it right now. not about the republican governors. the senate election is about the map, candy. the map is west virginia, south dakota, montana, arkansas, louisiana, north carolina, alaska. republicans have these opportunities because of this class. >> because they are in good territory, republican states. >> absolutely. >> look at virginia that is one good example of kind of what i'm talking about here. in virginia, off governor who bucked what conservatives are about voted for one of the largest tax increases in state history and why when voters went to the polls there is no difference between the d and the r why would i vote forth guy inflammatory on other issues this dominated that election? >> i'm going to tell you this, go out on a limb here, a year from now, look back on this any sort of republican who is going to run on the ideal that as of today, got 6 million people now with health care from obamacare, if you want to call it obamacare around "washington post" ran a

story a couple weeks back about how rural ken keep and other targeted senate race, rural kentucky, you have rural farmers who for the first time in their lives had the dignity that sort of for their family of health care, republicans are going to run in this next term on the ideal that i'm going to take health care and power away from 6 million americans and give it right back to the insurance industry, i think democrats like their chances. >> of course not going to run on that. >> but that is their point. >> a different point. >> repeal and take it away. >> cornell, come on. they are gonna run on -- >> but i've been waiting for their plan, stu. if you have seen their plan, let us know 'cause you're breaking news. >> also running on endemic on employment and all the issues this candy has been covering her entire show and look what's happening under the health care law. employers aren't going to be hiring more than 50 people but firing people on that cut, don't have people that can work more than 29 hours anymore and that is an issue stag international airport natoing you the economy.

>> you know, this is an amazing, because we have been here, republicans making this two years now, unemployment, 7%, 46, 47 straight months of job growth. the stock market ended at a record high, at a record high last year. your guest that was just on talked about sort of how health care costs are growing less than they ever have before. quite frankly this ideal that the economy is in the gutter and the president hasn't done anything in the economy, democrats should be running on this ideal -- >> a little hard to argue that the long-term unemployment benefit should stay if the economy is okay? >> not only long-term unemployment benefits but standing in the way of minimum wage. now what he is vastly popular, red states and blue states, raising the minimum wage. republicans stand in the way and say we are not going to raise the minimum wage when families are struggling. >> doesn't matter what the minimum wage is when you don't have a job, the main thing governors are focusing on and been successful at the state level. things like north carolina

versus virginia, we were talking about these races, is the perfect example. mccrory there passed the most proactive income tax reform, personal state, made it the most competitive in the region when it has been the least competitive for years. watching that as a >> i'm glad you brought that up. the grassroots in north carolina -- but you know what, this thing called moral money where you see an outpouring of the grassroots in the way you haven't so they have done more to generate enthusiasm and energy than we could have done with millions of dollars in advertising. >> a poll question can test well and not be decisive in directing people's votes. they may see we should extend unemployment benefits, higher minimum wage, but are they going to go to the polls to vote on that? chances are probably not. second thing is this economy is real interesting. i think cornell is right.

there are data suggesting we have some sort of recovery here. we have job growth. >> top 1% is getting recovery. >> as long as public doesn't feel that things are getting better, doesn't matter what the numbers are if they don't feel that. >> and there are numbers that show the majority of people over 50% of people believe that the economy will stay the same or get worse. >> this is real important here. more americans feel they won't lose their jobs anymore but they don't see wages keeping up with rising costs. wrong side of the issue about expanding opportunity for the middle class, you're in a bad place. >> let me told you here. we'll come back. when we return, colorado cashes in big on legalizing weed. our panel takes on pot politics when we come back. en up! i'm here to get the lady of the house back on her feet. [ all gasp ] oj, veggies -- you're cool. mayo? corn dogs?

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open to innovation. open to ambition. open to bold ideas. that's why new york has a new plan --

dozens of tax free zones all across the state. move here, expand here, or start a new business here and pay no taxes for ten years... we're new york. if there's something that creates more jobs, and grows more businesses... we're open to it. start a tax-free business at startup-ny.com.

call it pot politics, a high stakes question of civil liberties versus public health but also a potent source of lucrative green tax revenue. let's get the straight dope from our panel on what they think of marijuana legalization. i've done all of the puns. you don't have to anymore. is there a political angle that can be used one way or another on the whole question of legalization of pot? >> at some point we may see it. 58% of americans think it should be legalized which is an amazing number in and of itself. at some point it will happen in democratic primary before you see it in republican primary. in colorado, that legalization measure won by a larger percentage than the president won in colorado. one could argue it is a benefit

for being for legalization of marijuana. it's going to be neutral until some democrat comes out to say i'm for legalization of marijuana and starts to mobilize a constituency around that. >> i think if politicians want to talk about this or forced to talk about this, the smart way to do it is talk about this as a criminal justice issue. looking at statistics on marijuana incarceration or arrest or looking at the war on drugs and human and financial cost of that you have conservatives and liberals saying this has been a failure. our prison justice system and criminal justice system is something we need to talk about. over the last 20 to 30 years have we had a conversation about that? this may be a way to talk about that. >> political strategists want to know how an issue cuts before they take their stand. they want to be certain where momentum is and where enthusiasm is. i think marijuana could become a

partisan issue down the road, a few elections down the road. right now it's bipartisan in that none of the political strategists want to take gamble. >> go out and talk about pot. >> not quite yet. for an outsider in a democratic primary for an outsider, wyou'l see an outsider using it as a shot than you will mainstream. >> can you not sell it as enough of cops, you know, hauling in somebody for having an ounce or whatever it is in various states. it will save us money. it will cutdown on other types of crime because they will have more time to do their thing and by the way, we can tax it and increase tax revenue. >> i'm worried that you tax to legitimatize something. this is a tactic that has not worked well for some of these

thesentithes thesentithesen entities in the past. if you take away the marijuana issue right now, you can have a streamline and better criminal justice system and a good step in that direction. >> this is bipartisan, candy. pot brings people together, candy. >> apparently. makes them happier. >> people are concerned about jobs and health care and what can government do and how well can it do it. any politician that spends a lot of resources and time talking about an issue like legalization of marijuana will be criticized for not keeping his or her eye on the ball. >> couldn't someone that wanted to gin up those who show up at the polls say let's put a referendum on the poll about pot? >> maybe dispensaries will be the next big job creator. >> look at the obama coalition, we could go there.

>> thank you all for joining us. thank you for watching "state of the union." i'm candy crowley in washington. head to cnn.com/sotu for analysis and extras and if you missed any part of today's show, find us on itunes. search "state of the union." "fareed zakaria gps" is next for our viewers here in the united states. >> this is "gps" the global public square. welcome to all of you in the united states and around the world. i'm fareed zakaria. on today's show we have a rock star, a world famous inventor, and some seriously smart people. in other words, the usual "gps" fare. first up, some great panelists so gaze deeply into crystal balls and tell us what 2014 will bring for the world. will there be more wars, more peace, will we all make more money? in the bonus round, what will happen in sochi? then as we start the year, some pointers on success