Evan Smith: If you ask everybody in Austin right now, they’ll say Kay Bailey Hutchison is definitely running for governor in 2010, and, in fact, she’s been telling people in Austin for six months or more that she’s running and that they shouldn’t commit to anybody else. Can you shed a little light on the subject?
Kay Bailey Hutchison: Well, I have been talking to people quietly about what I hope I can do, what I’d like to be able to do. I haven’t made a commitment in any way because it’s just too early—it’s too early to be gearing up. I don’t want to peak in 2007 for a 2010 race. Would I like to do it? Yes. A lot of things have to happen to make it a reality. You can’t plan that far ahead with certainty.
ES: So as of today, you are not a candidate for governor?
KBH: Oh, no.
ES: Can you tell me some of the things that would have to happen?
KBH: I would have to feel that it was the right time for Texas for me to leave the Senate. I would have to feel like I have an agenda, that I’m ready to go. I do have ideas, but if I run for governor, I’m going to have a vision and a plan, and I’ll want to do big things. That takes time.
ES: When I interviewed you in the fall of 2004, we had a conversation looking ahead to the 2006 governor’s race, and you said very much the same thing you’re saying today. I wonder if anything’s different this time.
KBH: Yes, it is different. I felt that, last time, with everything considered, it was not the right time for Texas, and it was probably not the right time for the Republican party to have that kind of challenge. I feel today that this is the right time frame. My term would be up in 2012. I would not run for reelection—
ES: Regardless of whether you run for governor, you won’t run again?
KBH: Right. So is it better for Texas for me to leave early and give someone else a chance to start building seniority before the class of 2013? I think it probably is. Plus, I’m really humbled by the number of people who believe we need leadership in Texas that I can provide. And there’s not anyone who could really make a case to me that this would be divisive for the Republican party in a way that would make me step back.
ES: Although you may very well have a primary challenge.
KBH: Definitely. I would look forward to having a real race.
ES: Have you talked to Lieutenant Governor [David] Dewhurst about this?
ES: Do you expect he’ll be a candidate?
KBH: You’re doing the Austin-insider, Capitol-press-corps thing. I read the papers too.
ES: You mentioned the possibility of leaving your seat early. The other thing one hears is that you’ve told people you might step down as soon as 2009.
KBH: I think that has to be considered. But there’s been no decision.
ES: I want to ask you about the S-Chip [State Children’s Health Insurance Program] bill. You voted for it, although the four major Republican presidential candidates [Rudy Giuliani, Mitt Romney, Fred Thompson, and John McCain] are against it, and we know the president isn’t for it. Explain to Republicans in Texas why you sided with mostly Democrats on this issue.
KBH: There are several reasons. Number one, Texas is a high-growth state, and under the old law it has constantly been in a position of losing the funding it hasn’t used. What the old law said was that if you don’t use your full allocation after two years, the states that are overspending can apply to take your unspent money away. Knowing that we have the largest uninsured children’s population in the country, I negotiated with the [Senate] finance committee to protect Texas so that we would not lose our allocation even if we didn’t use it all. I got that concession because I know there’s going to be a time when we are going to need it. Once I got the concession, I felt honor-bound to support the bill unless I felt it was such bad policy that I couldn’t do it—and it wasn’t. The other thing is, treating children with preventative medicine is so much more cost-efficient than overuse of the emergency room or letting children get gravely ill or have a disease progress because they aren’t getting preventative care.
ES: What about the funding mechanism? It would rely on a per-pack cigarette tax. Some people have criticized relying on people to keep smoking in order to pay for children’s health insurance, and then there are those who say they just aren’t for new taxes.
KBH: That’s legitimate. I don’t like taxing one sector like that, but overall I think anything that we can do to discourage smoking is a good thing. At some point people are going to stop paying $35 for a carton of cigarettes. My husband smokes—it’s an addiction, there’s no question—and I don’t want my children to smoke. I want to keep young people from starting.
ES: You understand the situation this puts you in. It allows, for instance, a lieutenant governor who’s running against you for governor to say you voted to raise taxes.
KBH: A tax on cigarettes dissuades people from doing something that’s very bad for their health and for other people’s health, and it has some fiscal responsibility to it; if you’re going to expand a program that is becoming an entitlement, you should try to pay for it. I would prefer paying for it by cutting spending in other areas, but given the importance to Texas of being fully covered . . .
ES: I want to ask you about the general perception of your party right now. Is this a good time to be a Republican?
KBH: This is a hard time for Republicans. We’ve had a lot of hits. But in every political cycle, there are ups and downs. We’re on defense a lot now because we’re not in the majority. We’re trying to stop bad things, and I think when all is said and done the Democrats will have a record that they’ll have to run on, and we’ll have some pretty good arguments against it.
ES: Why are you not in the majority anymore?
KBH: It was a series of things. The Republican party has always been the party with new, fresh ideas, with a reputation for honesty and integrity. The scandals in the six months before the  election hurt us a lot. On the House side, the partisanship has been so strong. And there’s the war. You’ve got boots on the ground, troops in harm’s way. That’s the biggest problem for Republicans.
ES: Why is it a problem?
KBH: The weapons of mass destruction that the president thought were in Iraq have not been found, so people question why we went in. When people question the mission, you have a divisiveness in the country. Ken Burns talked in his documentary [on World War II] about everyone supporting that cause because everyone sacrificed—not just people in the war but people back home who were saving bacon grease, who were giving their pots and pans to make weapons, who were not able to eat everything they wanted to eat because food was rationed. That has never been the mood of our country with [the Iraq] war. I don’t think people have come together and felt a part of this effort.
ES: Did the government make a mistake in not asking more of us after 9/11?
KBH: The government didn’t understand the importance of saying to us, “This is a war for freedom every bit as much as World Wars I and II. If we let terrorists do away with our way of life, there won’t be freedom anywhere in the world. Our children won’t have the same opportunities that we’ve had.” That was what needed to be sold to the people, and I don’t think it was.
ES: Who should have sold it?
KBH: First of all, of course, the president. There should have been a plan to rally the people and, certainly, members of Congress who agreed that this is a war for our way of life. Now, I also believe that there are those in Congress who have politicized this issue, and that’s wrong too.
ES: I want to pose the question to you that has been asked of the presidential candidates who served in the Senate in 2003. Knowing what you know now—that there were no weapons of mass destruction—do you have any regrets about your vote on the war?
KBH: Let me say this: I believe the president was trying to protect America from another 9/11 with a weapon of mass destruction, and he had the intelligence, corroborated by the British and others, that Saddam Hussein did have them. We knew he had a history of using chemical weapons on his own people and the wherewithal to deliver. I think the president chose to go into Iraq to prevent that. Now, in the aftermath, from time to time he and others will say we needed to rescue the people of Iraq from this terrible dictator. Well, I draw the line there. I am not a supporter of preemptive war. I didn’t think we should have been bombing the Serbs when they were not doing anything to us. I thought we should have been taking action to stop the genocide but not bombing a country that had not attacked us. I feel the same way about the argument that we were protecting the Iraqi people from a terrible dictator.
ES: Not our responsibility.
KBH: No, it’s not for us to go bomb him into oblivion. Do we want to take steps to help those people fight him? Yes. But the time to have attacked Saddam Hussein was when he kicked the weapons inspectors out. We had a provocation, and we didn’t do it. To come back in for any other reason than Americans were in danger? I wouldn’t have supported it. But I think the president had justification to think that, and so from his vantage point that was a good enough reason.
ES: And that was the reason you supported the war?
ES: What kind of a job has the president done, generally speaking?
KBH: He has successes and failures. His successes have been underrated and his failures have certainly been adequately covered. I think there should be a more balanced view of his presidency.
ES: Which successes do you think are underrated?
KBH: Building a Department of Homeland Security. The fact that we have not had another attack on America. We are well on our way to border security. His education initiatives are a good success—I mean, he’s responsible for putting accountability in public education into law, and he worked with the Democrats to do it. He wants to have an ownership society, and he’s opened the door to more home ownership. And he has been successful in transforming the military into a more agile force for the types of wars that we are going to fight.
ES: And his failures?
KBH: We did not follow through in Iraq with the right post-invasion decisions, and we did not bring in neighboring countries in the Middle East as soon as we should have. It’s incredible to me that the moderate Arab nations have sat on the sidelines when this is in their territory. They should have been helpful to the United States and its allies, and they should have been supportive and much more active in trying to help the people of Iraq. And I think the president completely misjudged the immigration issue. His heart was in the right place, but he kept denying that the bill offered amnesty.
ES: So what do you do with the 11 or 12 million people who are in this country illegally?
KBH: If you start a guest-worker program, a large number of the 11 or 12 million will go back home to get into the system. You set it up so people can apply to come into our country to work legally. This will have two benefits. It will keep our economy going, because we’re going to have a real problem—
ES: We need the labor.
KBH: We do. And it would show anyone wanting to be in our country that there is a legal way to come in and that it will be enforced, and people would then be incentivized to enter legally. And the American people, and our labor unions, would not feel threatened.
ES: Do you support the deportation of illegals who don’t get the message, who don’t go back to their native countries and reapply to enter as guest workers?
KBH: If you have a legal system and you find people working illegally, then you have to have deportation.
ES: But aren’t they working here illegally now? Why not deport them now?
KBH: The system is broken.
ES: Would you support sanctions on businesses who hire such people?
KBH: When you have a guest-worker program that works, when you give employers a way to verify [the status of their workers], there should be sanctions.
ES: Do you have any sympathy for the Irvings and Farmers Branches of the world, where residents have taken matters related to illegal immigration into their own hands? Are they being too harsh?
KBH: I think they’re frustrated because the federal government has failed. That’s why we need to do the right thing.
ES: You have not endorsed a presidential candidate in your party. Do you intend to?
KBH: No. I don’t have a strong feeling about who our strongest, best candidate would be, and I have a lot of close friends on all sides. I’m not sensing an overpowering need for me to get involved. And I think endorsements are highly overrated.
ES: Do you think Senator [Hillary] Clinton’s going to be the Democratic nominee?
KBH: I do.
ES: Does that worry you?
KBH: Her policies are not right for our country, but I would probably say that about any of the Democratic nominees. Our philosophies are different.
ES: Is she electable?
KBH: I don’t think she is, though the jury’s out. You can’t say for sure. She’s got very high negatives, but the people who are for her are strong for her. She’s a polarizing figure, but it’s hard to tell where the country is, exactly.
ES: What are the chances that the Republicans will keep the White House?
KBH: It will be a close race, and the purple states are the states that will be really targeted. The mood of the country right now is pretty frustrated. I think we have a frustrated electorate. People don’t really like the partisanship. There’s a kind of toxic atmosphere about politics. I think the blogs feed on that. I think the intemperate nature of blogs and the lack of accountability have had an overall toxic influence on our elections. People are cynical, and these blogs are cynical and mean on all sides. So I don’t think that’s good, and I hope that at least even if you disagree with the mainstream media, there is a sense of integrity and honesty and standards. There are journalistic standards that blogs don’t have. We have a frustrated, toxic atmosphere right now.
ES: Let’s end with some more of that Austin-insider stuff. Have you ruled out the possibility of being the ticket-mate for one of the Republican presidential candidates in 2008? They could come looking for you and say, “We have Hillary at the top of the Democratic ticket, and we need a strong woman to run for vice president.”
KBH: I’ve been very clear that I don’t want it. I really want to come home to Texas, and I want to do it at the right time for Texas. But I think there will be talk about it. There’s already talk about it.
ES: You could put an end to it right now by saying, “Under no circumstances will I run for vice president.”
KBH: I don’t want to take a stand and change it. That’s why I’m not making commitments on what I’m going to do in 2010 or 2008—anything that allows someone to come back and say, “But you said . . .” I don’t want to be vice president. I’m not doing anything to put myself in a position to be vice president. And I have told the candidates that I don’t want to be vice president.