TRANSCRIPT: ABC News/Facebook/WMUR Democratic Debate

Yes, Barack, I agree with you completely that the best -- we need to unite America and we need to galvanize the American people.

And, Bill, I completely agree with what you just said. This is not a fight with politicians. And this is certainly not a fight with the American people.

It is a fight for the American people against those people who are stopping the change.

GIBSON: All right. Let me turn to something else.

Reversing -- you invoked the name of Al Gore a few moments ago -- reversing or slowing global warming is going to take sacrifice.

GIBSON: I'm sort of sorry Chris Dodd isn't here because he's talked a lot about a carbon tax in this election. Al Gore favors a carbon tax.

None of you have favored a carbon tax. Is it a bad idea, or is it just so politically unpalatable that you guys don't want to propose it?

RICHARDSON: Can I answer?

You know, I was energy secretary. It's a bad idea. Because, when you have a carbon tax, first of all, it's not a mandate. What you want is a mandate on polluters, on coal companies, on those that pollute, to reduce greenhouse gas emissions by a certain target.

Under my plan: 30 percent by the year 2020; 80 percent by the year 2040. It takes international leadership. The better way to do it is through a cap-and-trade system which is a mandate.

Furthermore, a carbon tax, that's passed on to consumers, that's passed on to the average person, that's money you take out of the economy.

RICHARDSON: So it's a bad idea.

Cap-and-trade is a mandate, but it's also going to take presidential leadership. It's going to take all of us here, every American, you know, to think more efficiently about how we transport ourself, what vehicles we purchase, appliances in our homes.

It's going to take a transportation policy that doesn't just build more highways. We have to have commuter rail, light rail, open spaces. We've got to have land-use policies where we improve people's quality of life.

GIBSON: Senator Obama?

OBAMA: Well, I agree with Bill that I think a cap-and-trade system makes more sense. That's why I proposed it: because you can be very specific in terms of how we're going to reduce the greenhouse gases by a particular level.

Now, what you have to do is you have to combine it with a 100 percent auction. In other words, every little bit of pollution that is sent up into the atmosphere, that polluter is getting charged for it.

OBAMA: Not only does that ensure that they don't game the system, but you're also generating billions of dollars that can be invested in solar and wind and biodiesel.

I do disagree with one thing, though, that Bill said, and that is that on a carbon tax, the cost will be passed on to consumers, and that won't happen with a cap-and-trade.

Under a cap-and-trade, there will be a cost. Plants are going to have to retrofit their equipment. And that's going to cost money, and they will pass it onto consumers.

We have an obligation to use some of the money that we generate to shield low-income and fixed-income individuals from higher electricity prices.

But we're also going to have to ask the American people to change how they use energy. Everybody is going to have to change their light bulbs. Everybody is going to have to insulate their homes. And that will be a sacrifice. But it's a sacrifice that we can meet. Over the long term, it will generate jobs and businesses, and can drive our economy for many decades.

CLINTON: Charlie, let me make a connection here that I think is really important.

CLINTON: I think the economy is slipping toward a recession -- the unemployment figures on Friday hitting 5 percent, the $100 a barrel oil that we also hit this week, the fall of the dollar. There's a lot of pressures on middle-class families, and the kind of costs that they have to keep up with have all gone up astronomically.

I mean, you know, the energy costs for the typical family in New Hampshire since George Bush has been president have tripled. And that's far beyond what the costs of the tax cut that they got from George Bush.

So, what we've got to do is use energy as an opportunity to actually jump-start economic recovery. We need to quickly move toward energy efficiency. We should require the utilities to begin to work for energy efficiency and conservation, costs that will be shared and decrease the pressure on families.

We need a weatherization and low-income heating emergency program that is out there now helping families in New Hampshire and elsewhere to cover their costs.

And we need to look at how doing what is right about energy is not only good for our security and good for the fight against global warming, but it will be essential in dealing with the economic challenges that we face.

GIBSON: Senator Edwards, I will take this question to you.

But you raised the issue of the economy right now. And we have a housing crisis in this country.

CLINTON: Yes, we do.

GIBSON: We have an energy problem -- in the cost of energy. And we now have a jobs problem.

We have, when we are -- and you raised "R word," recession -- when we are approaching recession, it is consumers who have spent us out of recession in most cases.

You're all talking about letting some of the Bush tax cuts lapse. And yet...

CLINTON: Yes, but, Charlie, the tax cuts on the wealthiest of Americans; not the middle-class tax cuts. One of the problems with George Bush's tax policy has been the way he has tilted it for the wealthy and the well-connected.

GIBSON: If you take a family of two professors, here at Saint Anselm, they're going to be in the $200,000 category that you're talking about lifting the taxes on.

(LAUGHTER)

GIBSON: And...

(CROSSTALK)

(LAUGHTER)

CLINTON: That may be NYU, Charlie. I don't think it's St. Anselm.

GIBSON: Two public school teachers in New York?

(LAUGHTER)

But that is -- you're in a situation where you're taking money out of the economy, is what I'm saying.

CLINTON: Look, if we set the cap where I'm saying, at $250,000 and above, that's a very small percentage.

And what I want to do is fix the alternative minimum tax, create these new job opportunities primarily through clean renewable energy, but also get back to where middle class families get the kind of tax relief that they deserve, which they really haven't been getting under George Bush.

(CROSSTALK)

GIBSON: Go ahead.

EDWARDS: Thank you.

What you see happening in America today, if you're president of the United States and as you are looking at this from altitude, is you see a very few Americans getting wealthier and wealthier; you see the biggest corporations in America's profits through the roof. ExxonMobil just made $40 billion -- record profits.

All of that happening at the same time that we have 47 million people with no health care; 37 million who will wake up in this country tomorrow worried about feeding and clothing their children. Tonight, 200,000 men and women who wore the uniform of the United States of America and served this country honorably will go to sleep under bridges and on grates.

EDWARDS: It's time for us to say -- and it's time for the president to say -- enough is enough.

This is a battle for the future of our children. This is a battle for the middle class.

Let's take jobs, which we haven't talked about. We've touched on a lot of other things; we haven't talked about jobs. We've had a trade and tax policy that is bleeding American jobs. And all it has done is pad the profits of the biggest multinational corporations in America.

You talk about professors here, at this college. Let me say a word...

GIBSON: Well, I shouldn't have done that, apparently.

EDWARDS: Yes, it was a mistake.

(LAUGHTER)

But we are -- I saw a projection, just a week or so ago, suggesting that America could lose as many as 20 million to 30 million more jobs over the next decade.

Think about that for a minute: 30 million.

And who's the most at-risk group?

EDWARDS: College graduates. This is not just people who are working in mills and working in factories who have been devastated by this -- completely devastated. These are middle class families. These are college graduates and their jobs at risk.

We need a different tax policy, a different trade policy where the first question is -- and this is what I will ask when I am president of the United States -- is this trade proposal, is this tax proposal, is it good for working, middle class Americans? That's the question.

GIBSON: Senator Obama?

OBAMA: There is no doubt that the economy has been out of balance. It's been out of balance throughout George Bush's tenure. And some of the trends from globalization preceded George Bush.

That's why I have proposed specific tax relief now, immediately, so that we would offset some of the payroll tax, that we would immediately put some additional dollars in the pockets of American families, working families typically making $75,000 a year or less, to not only stimulate the economy, but also to balance out a tax code.

And I would pay for it very specifically, by closing tax loopholes and tax havens. You've got a building in the Cayman Islands that supposedly houses 12,000 corporations.

OBAMA: That's either the biggest building or the biggest tax scam on record.

But the larger point is that we have to get back to a notion that opportunity and bottom-up economic growth is what the president should be fighting for.

And what we've had is a top-down agenda that is skewed toward the wealthiest Americans. It is making worse some of the trends of globalization that are already out there.

And one of the benefits of this campaign has been to listen and talk to the folks all throughout New Hampshire who are tired of it and want to see something change.

SPRADLING: Just very quickly, just for the governor -- I know we're running out of time. And I'd like to get this to you. You're going to say what you're going to say on this topic. But just, could you please address, as a governor, the small-business owners, in this tax talk, who may fit the category that we're talking about, but who are also providing the payrolls, proving the health insurance and are worried that if they lose out on this, that they could, too, be hurt?

SPRADLING: That's 75 percent of New Hampshire's economy we're talking about.

RICHARDSON: Well, also, like Governor Lynch here, I'm the only one that's actually run a state economy. I'm the only one that's balanced budgets and created jobs.

So, here's my response. You asked about how we improve the economy.

One, you got to balance the budget. I mean, this is $9 trillion debt to China, to commercial banks.

We got to have line-item veto authority for the president.

We've got to get rid of $73 billion in corporate welfare.

The second thing we need to do is, what ever happened to the Democratic Party? We used to be the party of jobs and economic growth. We should be investing in science and innovation and in green energy.

Tax incentives -- if a company pays over prevailing wage, give them a tax incentive.

RICHARDSON: And, lastly, we have not talked about education in this whole debate. We've got to improve our schools. We've got to pay our teachers better. Invest in science and math. Get rid of No Child Left Behind. We've got to have arts in the schools.

We have to be an America that recognizes we're 29th in the world in science and math, and countries like China and India are graduating many more times engineers than we are. That's competitiveness.

GIBSON: We have just a couple of minutes left. And it's been a very interesting evening, I would say. And I've been fascinated. I hope people who have watched have been, as well.

There have been an awful lot of debates. I think is debate 681. You guys may have counted. I've lost.

EDWARDS: At least.

GIBSON: Tell me one thing you've said in those debates that you wish you hadn't said. And it's your chance to take...

(LAUGHTER)

GIBSON: ... and it's your chance to take it back.

CLINTON: Oh, you're going to start with me?

(LAUGHTER)

GIBSON: Sure.

CLINTON: Well, you know, we've had -- I don't exactly know how many -- 13, 14. And I've lost count.

CLINTON: You know, I feel like they've been good exchanges among us. You know, there have been one or two moments that I would have taken back.

But what's really most important about these debates is that the Democratic Party stands in such contrast to the Republicans.

You know, the Republicans have a totally different approach to what we need to be doing. They're not talking about the mortgage crisis and trying to solve it. They're not talking about what I fear to be a slide into recession.

They're not talking about global warming. They're not talking about science and innovation. They're not talking about what really is going to face the next president.

So, I think that we've done in our debates a much better job in actually getting out the issues that are going to be on the desk in the Oval Office when the president walks in.

And, beyond that, I will leave it to the pundits to decide what I might or might not have said at any one of the debates.

GIBSON: I will let you off on specificity of take-backs...

CLINTON: Thank you.

GIBSON: ... since we're running out of time.

Governor Richardson?

RICHARDSON: Well, I made a lot of them. One that I particularly remember -- I think it was here in New Hampshire, the first debate. I was asked who my favorite Supreme Court justice was. And I said, "dead or alive?"

(LAUGHTER)

I said -- I should've stuck to the alive, because I then said "Whizzer" White because I idolized John F. Kennedy, and I figured if he appointed "Whizzer" White, this was a great Supreme Court justice.

Well, then I find out that "Whizzer" White was against Roe v. Wade, against civil rights. You know, so that's -- that wasn't -- that wasn't a good one.

(LAUGHTER)

(APPLAUSE)

GIBSON: Senator Edwards, I'll go to you, just with the passing comment that you haven't talked about Mrs. Clinton's attire recently.

EDWARDS: I was about to say...

(CROSSTALK)

EDWARDS: I already figured this out...

OBAMA (?): That was a good (inaudible).

(LAUGHTER)

EDWARDS: If you're going to pick the one for me, it was when I made the horrendous mistake of teasing Hillary about her jacket.

(LAUGHTER)

And I want her to know, I think you look terrific tonight.

(LAUGHTER)

(APPLAUSE)

GIBSON: And Senator Obama?

OBAMA: Well, I -- you know, there have been all kinds of aspects to my debate performance that I'd love to correct or sharpen.

But, overall, actually, here's an area where I agree with Hillary: that there has been a stark contrast, generally, between the four of us and those who aren't debating with us now but were previously.

There is going to be a fundamental difference between the Republican nominee and the Democratic nominee: ending the politics of fear that has so dominated our political debate, making certain that we're actually listening to the American people and the struggles and hardships that they're going through.

OBAMA: And I think the opportunity to bring the American people together and to push back those special interests, to actually deliver on meaningful differences in their lives, that's something -- that's a prospect that I think all Democrats should be excited about.

GIBSON: I want to thank all four of you for being here. And I want to thank the six Republicans who preceded you.

(APPLAUSE)

No matter who people across the country are supporting, whether it's in this party or the other, we wish all of you well and we thank you for being here. All the best.

We're going to take a commercial break. When we come back, Diane Sawyer, George Stephanopoulos.

Thank you for watching.

(APPLAUSE)

(COMMERCIAL BREAK)

SAWYER: Here with George Stephanopoulos. And there we're seeing the handshakes afterwards, everybody examining the body language.

STEPHANOPOULOS: Everybody playing nice.

SAWYER: That's right. Everybody is playing nice, a short, but friendly exchange between Senator Obama and Senator Clinton.

Let me ask you, George Stephanopoulos, here we are, the rumble at St. Anselm is over.

STEPHANOPOULOS: But they weren't playing nice throughout the whole debate.

SAWYER: No, they were not.

What about the Democrats? What were the moments that mattered?

STEPHANOPOULOS: Well, here's the one that I think mattered right near the top. Hillary Clinton took some shots at Barack Obama early on. And remember at the beginning of the debate, I posed the question, what is John Edwards going to do tonight? Is he going to focus on Hillary Clinton or Barack Obama? He made his decision. He rose to the defense of Obama, took on Clinton.

(BEGIN VIDEO CLIP)

EDWARDS: Every time he speaks out for change, every time I fight for change, the forces of status quo are going to attack -- every single time. Now, I didn't hear these kind of attacks from Senator Clinton when she was ahead. Now that she's not, we hear them.

CLINTON: Now, wait a minute. I'm going to respond to this, because obviously making change is not about what you believe, it's not about a speech you make. It is about working hard.

I want to make change, but I've already made change. I will continue to make change.

I'm not just running on a promise of change. I'm running on 35 years of change.

(END VIDEO CLIP)

STEPHANOPOULOS: Boy, did he push her buttons there. I don't think it was her best moment of the night.

On the other hand, I do think she came back later on in the debate. And probably her best moment came when WMUR's political director, Scott Spradling, basically told her, you know, New Hampshire voters like Barack Obama more than you.

(BEGIN VIDEO CLIP)

CLINTON: Well, that hurts my feelings.

(LAUGHTER)

(APPLAUSE)

SPRADLING: I'm sorry, Senator. I'm sorry.

CLINTON: But I'll try to go on.

(LAUGHTER)

He's very likable. I agree with that. I don't think I'm that bad.

OBAMA: You're likable enough, Hillary.

CLINTON: Thank you so much.

(LAUGHTER)

(END VIDEO CLIP)

STEPHANOPOULOS: Not a good moment for Barack Obama there. I thought he looked a little peevish, a little small.

SAWYER: I'm not sure what he meant by that. I expect he'll be addressing that tomorrow.

Nice smile from Chelsea Clinton...

STEPHANOPOULOS: Exactly.

SAWYER: ... out there in the audience.

But what about your question your raised earlier, which is you said that Barack Obama had to show up and not make mistakes on key policy issues and on the details of policy.

STEPHANOPOULOS: And he avoided that. I don't think he made any big mistakes tonight, particularly on national security policy. There's no question about that. He showed himself as sober and serious.

But I have to say, Diane -- and we did talk about this earlier as well -- you look at those candidates tonight, there is so much fatigue on that stage. Look at them when they weren't answering questions, when they were just in repose, and their faces were glum, down. I mean, we see a little bit of it right there.

I think the -- there's Barack Obama. He's looking like, "Where am I? How much more time do we have on this tonight?"

And I think that was a real factor tonight, the fatigue there.

The exception was John Edwards. I think he showed passion and vitality and energy tonight. We was on message. He had a strategy tonight. I think this was one of his best debates.

SAWYER: And you said that he took a run.

STEPHANOPOULOS: That's right. His staff took care of him this afternoon. He took care of himself. He took a break after the events and he did take a run this afternoon, and I think that made a difference for him tonight.

SAWYER: Right. Well, as somebody has written, it is the longest leadership selection process in the world. And you could see it on those faces tonight.

STEPHANOPOULOS: You really could.

SAWYER: When we come back after the break, we're going to check in with Facebook and see what you've been saying to us on Facebook.

We'll be back.

(COMMERCIAL BREAK)

SAWYER: Time now to check back in with our political pros inside the spin room to see how the Democratic contenders and their teams are finessing tonight's headlines.

Starting off, Kate Snow, who's been covering Senator Hillary Clinton. Kate, take it.

KATE SNOW, ABC ANCHOR: Well, spinning, finessing, here we go. Senator Clinton's campaign is saying that she had a great night. They're saying that she was tough; she was firm. They think that she showed strength and passion up there on that stage.

And they say that Obama looked weak. In fact, they say "Pretty talk won't be enough." And they say that, you know, all of his big ideas aren't going to be enough and that he showed that tonight.

He has not done enough to make change is their spin on this whole event. They think that she showed, tonight, some contrasts with him.

And interesting, Diane, they kept sending e-mails throughout the debate to all of us reporters, sending e-mails about everything she was mentioning -- Senator Clinton was mentioning, on stage, in terms of things that they think that Senator Barack Obama has been inconsistent on, some of the items that she mentioned throughout the debate.

Those e-mails were coming into our inbox.

And one more thing: They think that it was a great line when she said that she would be the first woman president and that in itself would be a big change.

SAWYER: Sending you e-mails throughout? The precision team at work there.

OK, David Wright with Senator Barack Obama?

DAVID WRIGHT, ABC CORRESPONDENT: Diane, the Obama campaign is very pleased with this debate. After the hype of Iowa, he really had to do two things: One, he had to convince the New Hampshire voters that he's for real -- that there's substance behind the celebrity. And they feel like he did that, no major gaffes.

Also, he had to defend himself from incoming attacks. No doubt, he was helped by the fact that Edwards was there as a sort of de facto tag team.

But they feel that Clinton did not lay a glove on him -- if anything, that her attacks bounced back on her.

Diane?

SAWYER: Right. And I should just point out that, with Charlie Gibson, at least, he had to be pleased that he got the results of the Redskins game, even...

(LAUGHTER)

(CROSSTALK)

SAWYER: ... from Senator Obama, even he didn't like the results of the Redskins game.

OK, David Muir is up next with Senator Edwards.

David?

DAVID MUIR, ABC ANCHOR: You know, Diane, you talked about that immediate access these campaigns had with the reporters covering them.

I got this BlackBerry message almost immediately after that moment you and George talked about, when Edwards aligned himself with Barack Obama in reference to Hillary Clinton saying that when agents of change start talking about change, the status quo shouts back.

And there were bloggers already talking about this.

And so, the Edwards campaign sent out the blog with this headline: "RIP, the Clinton era, 9:34 p.m. Eastern Time." That was the moment that Edwards aligned himself with Obama.

Edwards knows that his survival depends on Hillary Clinton's demise. And that's the story headline that they would like, the dream headline that he defeated the Clinton machine in Iowa and did so again tonight, Diane.

SAWYER: OK, moving onto Jake Tapper now, Governor Richardson.

Jake?

JAKE TAPPER, ABC SENIOR NATIONAL CORRESPONDENT: The view from Camp Richardson is that the governor did draw some very strong distinctions with the other candidates in terms of being the one to end the war in Iraq most immediately, with foreign policy and national security strength.

They said he had the best line of the night and rose above the fray, when, after that unusual moment with Senator Clinton, he said, "I've been in hostage situations that were more civil."

TAPPER: And then of course they feel that he made the case strongly for his executive experience.

Diane?

SAWYER: All right, well, thanks to the four of you. I know it's going to keep coming there, that you'll be e-mailing us and of course be online for everybody out there to hear more.

We thank you so much. And we're going to turn now to the Facebook command center, co-sponsors of course of tonight's debate. And Bianna Golodryga is there. Now that both debates have concluded, what are you seeing from the audience participating on Facebook?

GOLODRYGA: Well, a lot of people weighing in right now. I want to start with your question on what people's responses were to the surprises in the Republican debate. The one thing people were saying is that Romney, they were surprised at how beaten up he was a lot throughout the debate.

Another person said, "I was surprised at how much mudslinging there was going on, stemming from this Romney." And another person said, "I'm surprised at how out of touch these politicians are. They have no understanding of poverty."

Lastly, a person said, "I'm surprised there was no more talk about the environment."

Now let's go to what surprised us.

We're going to start with the Democrats' response, on to the charge now, what issue do you wish the Democratic candidates spent more time on. This surprised us because still, just like the Republicans, the economy was a key issue here -- 44 percent said the Democrats didn't spend enough time talking about the economy. Health care followed that, by 13 percent.

Moving on, could a Democratic president keep America safe? Sixty-six percent of you said yes; 27 percent, no.

And lastly, is tonight's debate giving you a better sense of who you'd vote for? Eighty percent said yes; 20 percent said no.

Diane, this is just beginning. And of course people can weigh in on Facebook until the elections in November.

SAWYER: So both Republican and Democrat sides said that the economy was what they wanted to hear.

GOLODRYGA: The economy. Surprising, yes.

SAWYER: All right. Thanks, Bianna.

We'll take a break. Closing thoughts when we come back.

(COMMERCIAL BREAK)

SAWYER: Want to turn now to George Stephanopoulos for a closing thought.

STEPHANOPOULOS: My big question coming in is did the debates make any difference tonight?

I think on the Republican side, I didn't see anything that stopped John McCain's momentum. In fact, I think Mitt Romney probably was hurt tonight.

But I also think in the crossover that John McCain probably helped Barack Obama...

SAWYER: Because?

STEPHANOPOULOS: ... because he spoke to Republicans tonight, not to independents in New Hampshire, and that's a very important voting bloc.

On the Democratic side, it's a clear battle, change vs. experience, Edwards and Obama for change, Hillary Clinton for experience.

SAWYER: Yes, some 44 percent of the voters are independents. They can vote either way there...

STEPHANOPOULOS: That's right.

SAWYER: ... Democrat or Republican.

Thanks to you, George Stephanopoulos.

STEPHANOPOULOS: Thank you.

SAWYER: And thanks to all of you.

We want to remind you we'll have more on "Good Morning America Weekend." George will have more tomorrow from New Hampshire, and also "ABC News Now" will have the debate again in cased you missed it, and don't forget ABCNews.com.

Thank you for being with us. Thank you for voting. And we'll see you tomorrow.