own health care message? tonight on "washington week." the first black president steps into his first racial controversy. >> the cambridge police acted stupidly in arresting somebody when there was already proof that they were in their own home. gwen: then attempts to step away. >> there was an overreaction in pulling the professor out of his home to the station. i also continue to believe, based on what i heard, that professor gates probably overreacted as well. gwen: the health care push is being threatened. s rose garden, news conferences and rallies. >> the nation cannot afford a future where our government spends more on medicare and medicaid than we spend on anything else. this is the price of doing

nothing about health care. gwen: some remain unmoved. >> this administration, this president has no one else to blame. they have no strong man, they have no press conferences left. gwen: on the hill, fed chairman ben bernanke pushes the reset button. >> we have a much better situation today than we would have if we'd seen a collapse of the global financial system last october. gwen: is anybody listening? covering the week, peter baker of "the new york times," michael fletcher of "the washington post," marilyn werber serafini of "national journal", and david wessel of "the wall street journal." >> celebrating 40 years of journalistic excellence. live from our nation's capital, this is "washington week" with gwen ifill, produced in association with "national journal." corporate funding for "washington week" is provided by --

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pbs station from viewers like you. thank you. >> once again, live from washington, moderator gwen ifill. gwen: good evening. if you ever wondered whether race was the third rail of our time, this week may have provided the answer. it all started with a disputed arrest and ended with a presidential intervention. the plight the henne lewis gates jr., the african-american scholar arrested on his front porch on what some called a misunderstanding and others called racial profiling became the president's problem, too, when he said this -- >> i don't know, not having been there and not seeing all the facts what role race played in that. but i think it's fair to say, number one, any of us would be pretty angry. number two, that the cambridge police acted stupidly in arresting somebody when there was already proof that they were in their own home.

gwen: the cambridge police were insulted, the blogs exploded. so today the president stepped in again with a surprise visit to the white house pressroom. >> because this has been ratcheting up and i obviously helped to contribute ratcheting it up, i want to make clear that in my choice of words, and i think i unfortunately gave an impression that i was maligning the cambridge police department or sergeant crowley specifically, and i could have calibrated those words differently. gwen: the president usually avoids, sidesteps race-related questions, issues. what was different this time, peter? >> a couple things were different. first of all, he was asked direct questions at a press conference, and it's harder to avoid that. and i think what you would be told is he was personally offended, to watch this

controversy play out in which a person he knew, person of some eminence, as he put it, a middle-aged man with a cane was hauled off with handcuffs on his own front porch struck something inside of him in a personal way. >> i think both statements are very telling about barack obama as a president. the wednesday night statement where he said the cambridge police acted stupidly was obviously heartfelt, something he believed. something genuinely came out of his own opinions on this. and i think the friday statement also in some ways was also another part of barack obama, the conciliatory barack obama, the one who wants to bridge divides and doesn't want to inflame things and probably regret it, although he didn't use that word, the idea his own words had further inflamed an already polarizing situation. gwen: i was reading, i think it was "salon" that head a line, breaking news, the president is a black guy. maybe is that what we were seeing? >> you could have easily forgotten that. he spent six months --

gwen: a lot of people wanted -- >> i don't know it's surprising it took six months for this to happen, but he knew at some point and it happens in any presidency that some racial issue will come and consume the country and consume the media for a while and it was going to be a test for how he would respond because obviously he does have this unique position in american society history. so he did choose to weigh in where he often might be more elyptical. a lot of people would say he had a duty to in some fashion because it had really concentrated a lot of people's attention. but what it did was something he didn't want, which was to distract from health care and other issues he'd rather talk about. >> do you think that's why he backed off and sort of recalibrated his statement? >> i think that's a big motivation, obviously. he understood, i think, if he didn't go out there and try to lance the boil to end the controversy it would keep going on and on and he could give as many interviews he would want

about the public plan or cost controls for medicare and all be washed away by, should he apologize, should he not apologize, so he tried to end it today. maybe the sunday shoes will be a lot to talk and hopefully by monday he can get back to his health care. >> barack obama is famously displinned -- disciplined and doesn't make many missteps. was he not expecting a question on this? did he really ad lip this whole thing. >> he didn't ad lib. the word "stupidly" might have been the biggest problem. with him saying there might be issues of racial profiling in america probably would not have created a big furor. i think if he said gates is a friend of mine and i don't know the facts but i have a hard time imagining skip gates would commit disorderly contact -- conduct, that probably wouldn't have been quite as big. i think it was the word "stupidly" and looks like he was attacking the police and it's a volatile area and hits a wedge american society had a lofpk time -- gwen: to call the police officer. >> that's a remarkable thing.

the president intervenes in a local case that's become national, call the police officer, calls the professor, and invites both of them to the white house for a beer. that's really something. i can't wait for that. gwen: i want to see that. you had a question? >> so do you think that the friday timing was wise? is that going to work? >> i think it was necessary. i think it took too long to get to this point. there was a question whether he could do it or not. the white house came out this morning and said the first thing early morning, informal briefing the president had nothing else to say on the matter four hours later. gwen: so there must have been a lot of discussion. >> a lot of discussion inside the white house today and a lot of disagreement. you know, we don't have a good picture of how much disagreement but there were people in the white house who were wary of him revisiting the issue and others who felt like there was no way to get around it unless he did. >> it has been very dismiss of the idea and the president said

it's pretty uncontroversial and he said himself this was a straightforward analysis. >> although they say the president didn't watch it was his press conference by the cambridge police department and they were very incensed and talked how the president had bemeaned sergeant crowley and asked for his apology. interestingly, an african-american officer who had been at the scene came out for sergeant crowley and stood behind his fellow officer 100% and added to the whole mix of things and they recognized without doing something they had to put an end to it. gwen: one thing we know is health care was supposed to be the main issue of the week and the president gave it all he had, whether he was talking to network anchors -- >> we've literally been waiting 50 years and we still haven't gotten it done. gwen: or to primetime audiences. >> i'm rushed because i get letters every day from families that are being clobbered by

health care costs. and they ask me, can you help? gwen: but as polls showed growing skepticism about his plans, did the white house accomplish what they intended to accomplish this week, michael, especially with what we just saw happen? >> i'm thinking the word no. not yet. but it wasn't for a lack of trying. the president was out there using the full arsenal of the presidency for a rose garden statement, a primetime news conference and had a rally in ohio. he did interviews for a host of interviews, all trying to make the case that health care reform is necessary, not just to cover the 46 million people who don't have health care right now, but to really save the economy going forward. and he promises a lot. he's saying we can have better care for less costs and that health care reform is really key to taming the deficit long term. and the american public kind of shrugged at this saying we've heard promises before. part of what the white house is encountering kind of like extraordinary action fatigue.

you've had the financial bailouts and the auto bailouts. and while this may have prevented sort of total crisis in our economy, i don't think it's shown up in the lives of americans as improvement. that's a problem the white house is facing to kind of penetrate this growing skepticism about big government action. >> the president wanted both houses to pass their own plans by the august recess, and it's not going to happen in the senate. how important is that? why does it matter whether they do it or don't do it by the august recess? >> in the end it doesn't matter but it's a small blow on obama. he put the deadline out there and now he's had to back off. yesterday when senator reid made the statement, he said that's ok, i just want to see continued progress. and perhaps the senate finance committee will have a bill out. it's just another small blow. i think the deadline, the president says it himself, without a deadline nothing happens in this town and he wants to keep the heat on congress. but the evidence is these issues are hard and com play the dayed and hard to get across to the public and hard to build a public consensus for

all the talk of the people that don't have coverage, 85% to 86% of americans do have coverage. and while it's imperfect and people are losing coverage, people are scared to give up what they don't know. >> what is behind the public uneasiness showing up in the polls? people always were concerned about losing their coverage. what has changed? >> i don't know it's changed so much as people start looking at the details and they look very americanny and for all the promises the president makes, he has a plan that delivers the things he says. there's no plan yet that puts together all these elements. people have different ideas out there that sort of get at part of the problem. many of these cost savings that are the magic bullet here are speculative and don't know whether they'll work. you can talk about the mayo clinic or the cleveland clinic does and we know that can be scaled up with the population of patients, some really deep

questions here. >> how do they decide when the president does the press conference, bully pulpit stuff and when he says ok w we've got to do something like this med-pac commission and when are they being specific or just hearding -- herding the cats on the hill. >> they're moving to more specificity. the question has been when is the president going to focus in on health care solely. he's been doing that and everything else and now when congress comes back i think you'll see him talking a lot more about specifics. but again, this stuff is pretty dense and really hard to sell on us. gwen: that's what you saw on the news conference the other night. how much faith is this white house put in their guy? i mean, it's remarkable how often we see him in front of a microphone, how often we see him in front of a bank of cameras. they clearly have decided, details aside, the president has magical powers of persuasion. >> right. that's right. that's barack obama's stock and

trade. you look at the polls and even though there's a lot of skepticism about his policies that come creeping in he remain as popular president. his popularity is down some but clearly the white house thinks he's the salesman that can make this deal. gwen: as he said, without a deadline nothing happens in this town. congress leaves town the beginning of next month. do they worry they'll lose their momentum? >> i think they worry about that but the president established a new deadline yesterday and said, i want a bill on my desk by the end of the year. gwen: i noticed that. >> i think that's one he'll have to stick to. gwen: when in doubt come up with a new deadline. we've got to move on. the white house p.r. push is the hard nuts and bolts work underway behind the scenes at the capital. harry reid admitted he would miss the president's first deadline to get a bill passed before the summer recess. but why did congress then seem to hit the brakes? it felt this week they could hear the rubber hitting the road, as everybody said, wait a minute.

what happened? >> they did hit the brakes. but this is no surprise to many people. this is part of the natural political cycle of a big piece of legislation. people expected this would happen. until now or recently we've had many of the stakeholders coming at this very easy. they wanted to sit at the table and keep their seat at the table, whether we're talking about the republicans or moderates or conservatives or the insurance industry, they wanted a seat at the table. so we didn't hear a whole lot of complaining. now we're making the big decisions and it's bound to happen that once you start making the big decisions, that everyone is going to start drawing their lines in the sand. so the concerns were there before about a public plan, a public health plan that would potentially compete with private insurance plans for folks who don't have insurance. the concerns were always there about we've been talking that this bill could cost more than $1 trillion, maybe even $1.5 trillion for a while now. this isn't the first we're

hearing of it. but this is the first we're starting to hear complaints about these things. gwen: are the complaints rooted, as the president said, are they rooted in the idea that people just feel nervous and this is a big deal they want a little time to look at? >> i think it's both. in the national we're really talking about the republicans who are starting to feel more uneasy than they did before and the house, of course, there's a strong democratic majority they've not had to give a lot of thought to what the republican concerns might be. in the house we're talking about the so-called blue dog democrats, the conservatives and the moderate democrats. and frankly in the house, this bill really can't be passed without their support. but whether it's the blue dogs in the house or the republicans in the senate, the issues are pretty much the same. some of them are philosophical, having to do with big government. they don't really want what they see could potentially be a big government takeover. they don't really want a hugely

expensive bill. they don't want to -- you know, last week when the director of the c.b.o. dropped the bomb -- gwen: congressional budget office. >> exactly. he basically dropped the bomb that he said none of the big bills on the table would actually do much to decrease the costs of health care. that was very salient and that's what really got us started and is continuing this week, in a way he opened the door a bit for the republicans and the conservative and moderate democrats to step in and say, ok, that's exactly what i needed to hear, here's my line in the sand. >> we're talking the republicans but in the senate the democrats if they were to have all their members healthy and in town have 60 votes, enough to get past a filibuster. what's happening with them? why are the republicans able to have any influence on this process given that? >> actually, there are two reasons.

one is that you do have moderate and conservative democrats with real concerns in the senate. you look at senator conrad who runs the budget committee. he is a -- he's very concerned about the price tag and making sure you do something about costs. but in addition to that, the senate finance committee where a lot of this is going on has a tradition of bipartisanship. and in this committee, senator baucus, the chairman of the committee, is dedicated to working with his counterparts, senator grassley, republican from iowa, to come out with a bipartisan effort. he said this from the beginning when senator grassley was chairman and did the same thing for senator baucus. it's their tradition and they've vowed to work together. >> the president has made the case, he made it at the press conference that if you want more uninsured and higher costs, the way to do that is to do nothing. do members of congress see it that way, that doing nothing would be worse than doing something? or are they willing to say we

can't agree, we'll go home and say we tried and failed. >> i don't think there are many people who would feel the way that they could go home and say we tried, i'm sorry, the other party really messed it up and really stopped us from doing it. everyone feels there's a lot at stake here. there are many people who believe we've got to get the whole thing done. there are many people who believe even if we can get a piece of it done and even if we can expand coverage to children or expand coverage to a group of people that we've got to do something. and in fact that's what's keeping these negotiations, they're on again, they're off again, before, when i left the newsroom this evening to come here, i had one person yelling from one side of the newsroom, yeah, they're on again. someone else would say no, they're off again. and so, you know -- >> another day. >> that was about an hour ago and i'm not sure where they are now and it's minute to minute and the emotions are running very high and so it's not clear from minute to minute it's changing. gwen: we love it at the end of

the year when congress decides it's going to be crazy, the end of the summer this always happens because congress is also concerned this week, arching a collective eyebrow at federal reserve chairman ben bernanke who testified he has a plan, an exit strategy. where have i heard that before? wants to extract the fed from the unprecedented private sector intervention. come august 4 you'll be able to read all about it in david wessel's new book "in fed we trust." ben bernanke's war on the great panic. tonight he'll tell us what bernanke was up to this week. >> that's right, gwen. the poor guy went to the hill three times, once in the senate and once before the house. he had a very consistent message. things are getting a little better and i deserve some of the credit. and barney frank told him no one got elected with a bumper sticker saying, you could have been worse. he said, you really do need to change the regulatory -- financial regulatory apparatus so we don't go through this again. and i'm 100% behind tim

geithner, the treasury secretary and his plan, except for the things i don't want to do. he said to congress emphatically he hates this bill ron paul is pushing that has the surprising support of 2/3 of the house that would give the government the accountability office the right to audit the feds' monetary policy, their interest rate decisions and basically said if you do that the fed will lose its independence and we'll have inflation. he was very strong on that. and he said, as you said, i've got an exit strategy in mind so you don't have to worry about the fed inadversently creating inflation, i've got a way out. then he turned the tables on them and said, so what's your exit strategy? how are you going to get out of this $1.8 trillion deficit that you built? gwen: did they buy any of that? >> they all promised they don't want to interfere with his independence and then they go to say why is it if we audit your monetary policy things and tell you what we did wrong, it's democracy, you're for transparency, why don't they do

it? a lot of them are suspicious of the geithner plan and don't like the idea of creating a consumer agency that would take all the consumer stuff. the banks hate it and some of them were very sympathetic and i didn't notice any profiles of courage of people coming up with solutions to the deficit when the chairman of the fed offered the opportunity for them to give it. >> when does the chairman think the exit strategy will be needed? are we getting close to the end or are we to the point where they can pull back some of their easy money on policies? >> i don't think from what he said this week, i don't think he thinks we're anywhere near that. the recession could be about to end, meaning the economy may be close to the point where it stops shrinking and starts to grow again. but the fed's forecast is unemployment will remain very high, 9.5%, 10% for another year and a half, two years. he thinks they have a long time to go before they have to start pulling back and wants to reassure people they can do it when they want to. >> is it our impression that we've seen him a lot lately, bernanke, out in public and

doing a lot of talking? is that typical for a fed chair and he said the point was coming up, obviously, at the end of -- being next year, is there any relationship there, campaigning for another term? >> it's very unusual. he's taken a very different approach. he came to office saying he wanted to be less of the personification of the fed than alan greenspan, his predecessor, but in the crises gone to places fed chairmen haven't gone before. he did a press conference at the national press club. he went on "$60 minutes" and sunday night he's doing a town meeting in kansas city that will be on news hour. those are things greenspan never did. i think his primary ambition is people are suspicious of the fed and going over the heads of congress to say, look i saved the country and here's why i did it, trust me. then it makes him a little more likely to be reappointed, then that's an added benefit. >> will he be reappointed? >> i think if the president had to decide right now, i think the odds favor reappointment.

you can bet on the internet on this. and i checked before i came over, nearly 70% odds of reappointment. but i think the white house will wait a while because if something else goes wrong, if the economy goes south and they need somebody to blame, they would like to have the opportunity. gwen: i'm curious. he was giving a version of the green chutes speech, things are getting better. his optimism is muted. is it justified. >> i think if you say are we at the risk of having another great depression, another 5% or 6% decline in the g.d.p., the answer is he's right, we're beyond that. things seem to be getting better. the stock market is now finally risen above where it was when the president took office. the g.d.p. is probably about to stop contracting. so in that sense things are better. but they're still awful. and that's a very hard message to deliver. gwen: ok. you can preorder that book on amazon. we'll end on that note.

but the conversation continues online. check out our "washington week" webcast q&a, your questions, our answers, find us at pbs.org/washington week. turn to news hour with jim lehrer and see the press conference monday in kansas city. we'll wrap it up and see you next week on "washington week." good night. captioned by the national captioning institute --www.ncicap.org-- gwen: every thursday get a preview of our topics and panel with our "washington week" email alert. available at washington week online at pbs.org. >> "washington week" was produced by weta which is solely responsible for its content.

>> corporate funding for "washington week" is provided by boeing. and the national mining association. major funding for "washington week" is provided by the annenberg foundation. the john s. and james l. knight foundation. the corporation for public broadcasting. and by contributions to your pbs station from viewers like you. thank you. >> we are pbs.

>> this week on "bill moyers journal."