GWEN IFILL: We go around the world focusing on the good news, the bad news and the challenges that remain.
The stories that shaped 2014, tonight on WASHINGTON WEEK.
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I’m eager to work with all of you.
IFILL (voice-over): President Obama declared 2014 his year of action.
OBAMA: America does not stand still and neither will I. So wherever and whenever I can take steps without legislation to expand opportunity for more American families, that's what I’m going to do.
IFILL: The Congress resisted his executive action, especially after Democrats went down to midterm defeat.
REP. JOHN BOEHNER (R-OH), SPEAKER OF THE HOUSE: This is a serious breach of our Constitution. It's a serious threat to our system of government.
IFILL: After Republicans seized control of Congress, for the president, it was to the pen and the phone -- on immigration, on climate change, on foreign policy.
OBAMA: America knows how to solve problems when we work together, we can't be stopped.
IFILL: From North Korea to Ukraine to Islamic State beheadings, new threats multiply.
JOSEPH BIDEN, VICE PRESIDENT OF THE UNITED STATES: We will follow them to the gates of hell until they are brought to justice!
IFILL: But there were also new opportunities.
JOHN KERRY, SECRETARY OF STATE: It is time to try working with the Cuban people to build a better and different future.
IFILL: Health crises as thousands died from Ebola in West Africa. Terrorism in Australia and Pakistan. And at home, government scandals at the Secret Service and at the Veterans Affairs Administration.
SEN. JOHN MCCAIN (R), ARIZONA: Treating those to whom we owe the most so callously, so ungratefully, is unconscionable. And we should all be ashamed.
IFILL: From the Supreme Court to the polling booth to the grand jury, it was also a year for cultural debate, with moves to legalize marijuana and same-sex marriage --
PROTESTERS: I can't breathe! I can't breathe!
IFILL: -- as other old debates on race and justice flared anew.
ERIC HOLDER, U.S. ATTORNEY GENERAL: Millions of people throughout our nation have come together bound by grief and bound by anguish in response to the tragic deaths of Michael Brown in Ferguson, Missouri, and Eric Garner in New York City.
IFILL: Covering all this and more, we look back at 2014, with Dan Balz, chief correspondent for "The Washington Post," Carrie Budoff Brown, White House correspondent for "Politico", Indira Lakshmanan, foreign policy correspondent for "Bloomberg News", and Pierre Thomas, justice correspondent for ABC News.
ANNOUNCER: Award winning reporting and analysis covering history as it happens, from our nation’s capitol, this is WASHINGTON WEEK with Gwen Ifill.
Once again, from Washington, moderator Gwen Ifill.
IFILL: Good evening.
2014 is practically over. So, it's time for our annual long look back at the year just past and what a year, from news of a recovering domestic economy to the rise of an alarming new terror threat as tensions with Cuba ebb, nervousness about North Korea rise, while domestically the president's party absorbs a major hit, losing control of the Senate in a billion dollar midterm election, and unrest in major American cities launches matters of race and justice to the front burner.
We start this week with the economy, which is ending the year on an upswing.
This was the president last week.
(BEGIN VIDEO CLIP)
OBAMA: There is no doubt that we can enter into the New Year with renewed confidence that America's making significant strides where it counts. The steps that we took early on to rescue our economy and rebuild it on a new foundation helped make 2014 the strongest year for job growth since the 1990s. All told, over a 57-month streak, our businesses have created nearly 11 million new jobs.
(END VIDEO CLIP)
IFILL: And that was before this week's news that the Dow broke 18,000.
So, is it too soon for the people at 1600 Pennsylvania, Carrie, to be doing a little victory dance?
CARRIE BUDOFF BROWN, POLITICO: That exact question has vexed this White House for years because of all the false starts, signs of growth in the economy only to have a setback. But within the West Wing, there is this feeling for two reasons that they have to start pushing out the message in a more robust sort of uniformly positive way.
One is, the numbers are showing strength, sort of consistency over a period of months. But the other reason I believe that we're going to see the president talk more forcefully about the economy in the next few months, certainly at the State of the Union next month, is because he's running out of time to make the case for his presidency and what he did. He's in his last two years. It's time for him to start talking about his legacy, the economic legacy, on the economy --
IFILL: Now, he doesn't use the L word, it should be said.
BROWN: He doesn't but I think we're going to see that change. There is a -- within the West Wing, there's planning underway on how to deal with the legacy question, how he frames it. The economy is a big piece of that and this week he got more positive news. So, I think that sort of fear of really embracing it is fading away.
However, there is going to be an asterisk that they’re going to continue to put on that message, and that’s about wages, and that gap that exists. And I think we're going to see him -- in many ways, it's the same frame he's been using.
BROWN: "We're making progress but there's more work to do". I think the State of the Union next month which they'll plan over the holidays and really work at next month, it's going to be that exact thing.
IFILL: But at the same time, Dan, the president powered into this post-election period pretty aggressively, ticking off the people who theoretically could be his friends in Congress.
DAN BALZ, THE WASHINGTON POST: You know, watching him at the press conference he did before he went off for his holiday vacation, you would not know that this was a president whose party took such a beating in November. I mean, he was very upbeat. He was jaunty. He was joking with some of the people who are here with us tonight.
And but more importantly, he just started to act aggressively from the minute the election ended. Now, he's been through a number of post-election periods -- victories and defeats over his presidency. He's often had a pretty good December. I mean, he had a very good December after the 2010 shellacking. He got a lot done in the lame duck session.
The key is what happens next year, how he's able to do things next year and how he manages the new business with a Congress that’s now fully in Republican hands.
IFILL: You know, one of the things I find most interesting is how this White House tries to deal with the question of job creation. He had a different formulation than his year-end press conference. We talked about the auto industry. And that was something I hadn't quite heard quite that way before, which is that he added, what, half a million -- 500,000 jobs there alone.
BROWN: Yes. I mean, that’s -- he’s talked about the auto industry and he can claim a direct link between those job growth and decisions he made early on in his presidency. So, I think we're going to continue to see him try to draw links like that. He helped save the auto industry when a lot of people said, don't provide them the assistance from the government.
This year, it’s really sort of a tale of two years. You know, he had that first 10 months where it was so atrocious for them and if his year had ended in November, it would have been one of the worst on record. But in the last six weeks, the good economic news this week is really -- he had a bunch of things that he did show muscular presidency in the last six weeks.
But the economy, the positive news on the economy, is really sort of as good as they could want to get in terms of the economy is going to define his presidency after all is said and done and that strength really not only satisfies them from just sort of a purely -- you know, from a standpoint of helping the country, but really, I think personally in the West Wing, they get kind of a joy out of having good economic numbers that’s going to put the Republicans on their heels.
BALZ: But the interesting thing is, within his own party, there is a debate about the other part of the economy, the economy that is not working, the economy that has left middle class families struggling and this kind of rising populism that we've seen in the interest in Elizabeth Warren puts the Democrats in a bind, even as the president's trying to make a good case.
IFILL: Well, let's move on because there's so much else to talk about tonight. We’re not going to make it all done. The good economic news did not obscure the year’s political setbacks for the White House, as we were talking about. And victories for Republicans in Congress, the president acknowledged defeat but showed few signs of conciliation, moving almost immediately to unilaterally changed immigration law.
(BEGIN VIDEO CLIP)
OBAMA: To everyone who voted, I want you to know that I hear you. To the 2/3 of voters who chose not to participate in the process yesterday, I hear you, too.
BOEHNER: I believe that the president continues to act on his own. He is going to poison the well. When you play with matches, you take the risk of burning yourself.
(END VIDEO CLIP)
IFILL: So, did the midterm election results change the political architecture in Washington?
It didn't look like it just there now, Dan.
BALZ: Well, it changed the balance of power because the Republicans had a big victory. They got nine more seats in the Senate. They've now got 54 seats, which is more than most people expected. That does change the calculus.
I think the other thing that's realistic is that these two sides know one another pretty well and there's a lot of distrust. It's going to take an enormous amount of work for them to really get together and do things and it's not clear that either side is prepared to do it. Certainly, what the president showed a signal that he's prepared to move on on his own whenever he wants to or can, and the Republicans now have the burden, because they have both the House and Senate, of showing they can govern. And there are a lot of people in the party who are pushing them to do that.
IFILL: Exactly. So, what is their plan? If the president has clearly come out, showing his hand that he's going to poke them in the eye when he can and blame it on them when they screw up, what do they do to set their agenda?
BALZ: I think they have two things they'll want to do. One is to satisfy the conservative base in the party to do some things to undo what the president has done, whether it's on healthcare or some other issues. They are going to take votes to do that and try to put some things on the president's desk, the XL Keystone pipeline, for example. They're going to do those things and force him to veto them.
But I think the other is they are going to look for some ways, small, perhaps, where they can work with the president. I think that Senator McConnell who’s going to be the new majority leader will want to try to do some things.
Trade is one obvious place where the president's policy is closer to the Republicans than to a lot of Democrats. They may be able to do something there. Whether there's any hope on taxes or entitlements is a whole another question.
BROWN: I think the economic news this week makes it less likely that there will be any sort of tough looks at deficits and debt reduction and I’ve followed this debate for years with this president and this Congress and they are diametrically opposite. There's a lot of talk. But even when it gets down to it on either side, neither party can make the tough decisions.
PIERRE THOMAS, ABC NEWS: Guys, what does the good economic news do to the political dynamic with the Republicans? What does it do there?
BALZ: Well, they will continue to say, as they have every month, in the face of job increases, that this economy is not working for enough people. I think both sides are now keenly focused on middle class economics and a message for the middle class so I think that's where the Republicans will go. They will not acknowledge fully that the recovery has touched as many people as it needs to.
INDIRA LAKSHMANAN, BLOOMBERG NEWS: Dan, of course, the president has acted unilaterally as he did in immigration. But I wonder how much will he be able to, on his own, achieve some of his remaining central desires for this administration? Closing Guantanamo is one thing I’m thinking of. And the other is climate change, cap and trade. Will he be able to do that alone?
BALZ: Well, there are limits to what he can do. I mean, that’s --
IFILL: The White House trumpeted this week that the president has signed 80 executive actions, right?
BALZ: Yes. There is a lot he can do but there are limits to what he can do, whether it's on immigration, certainly climate change. Guantanamo, he's wrestled with that six years and can't quite figure out the formula. You would have a better sense of that than I would, frankly.
BROWN: And I think they have -- I think the Cuba announcement this month took a lot of people -- you knew something was percolating but sort of the extent of the back story to what they were doing. I mean, there has to be other things like that they're doing, I think.
IFILL: Well, on climate change --
BROWN: Yes, well, it’s remarkable.
IFILL: -- was like that, too.
BROWN: Yes, and I think Guantanamo, I think they'll try to figure out a way.
LAKSHMANAN: Well, they have been this week accelerating the transfer of some of the detainees to third countries. The question is, he has to get everyone out of there if he wants to shut the place down, and the U.S. has not been willing to keep some of those detainees in American soil.
IFILL: Was there positioning, Dan, on -- this sounds like a story for 2016, was there any positioning that we saw this year that matters going forward?
BALZ: A little bit. I think the most significant are two things. One was the book tour by Hillary Rodham Clinton which did not go as well as some of her people hoped or I suspect as well as she hoped. I mean, I think that she went into it thinking it was mostly a book tour and it was in fact viewed mostly as an opening act for 2016.
I think the other important development was a move recently by Jeb Bush, the former Florida governor, to say explicitly he is actively exploring, which I think most people took as him saying, I am going to get into this race. And I think that had the effect of shaking up all of the Republicans a little bit to think about how quickly do I have to move, what does this mean for me, how will it affect fund-raising, et cetera.
IFILL: Well, we know it’s going to happen next year and we’re going to be all up in that. But let's go to foreign policy. Take your pick. From Ukraine to Afghanistan, from the Middle East to North Korea to Cuba to Nigeria, there were challenges in every corner of the globe this year.
The face of most U.S. involvement in nearly every case was Secretary of State John Kerry who traveled nearly 350,000 miles to 44 nations just this year. In September, he weighed in on the grave new threat of Islamic state terrorists who are beheading hostages.
(BEGIN VIDEO CLIP)
KERRY: When terrorists anywhere around the world have murdered our citizens, the United States held them accountable no matter how long it took. And those who have murdered James Foley and Steven Sotloff in Syria need to know that the United States will hold them accountable, too, no matter how long it takes.
IFILL: The hard part, of course, is how is the U.S. holding its enemies accountable, Indira?
LAKSHMANAN: Well, I think the major situation we're looking at now is, of course, North Korea and with the president coming right out and saying strongly that North Korea was behind the Sony hack and saying that there would be a proportional response from the United States without showing his hand about what that response is going to be, we don't know the time line or the menu of options that his advisers are giving to him, you know, it raises a lot of questions.
I think with North Korea it's particularly difficult because they're already a pariah state. They’re already completely cut off from the global economy. They are sanctioned to such an extent that I’m not entirely sure that adding more sanctions would make a difference.
IFILL: But even -- let's think about our friends, for instance, Ukraine. Ukraine was a huge story for many, many weeks this year and the U.S., obviously, as is often the case, came to its aid in the end, toward what end?
LAKSHMANAN: That's right. Well, we judge of the saw a bill that passed through Congress at that president just signed last week, which adds on more money, half a billion dollars in support for Ukraine, including about $300 million of that being for military aid, authorizing it if the president chooses to go in that direction and the whole point of this law was to give the president the right to give lethal aid to Ukraine.
Now, I would have to say that in Congress there are a lot of people much more enthusiastic for lethal aid to Ukraine, much more enthusiastic for NATO membership for Ukraine than either the White House or our allies in the E.U. So, I think it remains to be seen how far we can go with that. We certainly have hurt the Russian economy with sanctions and oil prices on their own have really hurt the Russian economy.
BROWN: Yes, there's a feeling in the White House that's what happened in Russia with the economy and the ruble and everything else that things are working and like it's at least contained. It’s a sort of a contained problem that's not spiraling out of control.
LAKSHMANAN: But I would say working to what end? I mean, the purpose of sanctions is not meant to be to punish Russia as an end. The purpose of sanctions is also to always get the government to change behavior and we see sanctions on North Korea as one example have not been effective over the years. They have not stopped their nuclear program. They've not stopped their human rights abuses and with Russia, like wise, we see that they have not backed down.
Now, you can't really prove the negative. The White House would have you believe they would have gone further into Ukraine without sanctions. So, at this point, we know we're punishing their economy but we don't have a horizon yet for whether Putin is going to back down.
THOMAS: You know, onto "what end" question, I want to go back to ISIS for a second. A lot of law enforcement officials tell me that beyond the military action to attack that group, their ability to inspire people to go there is a huge issue. We've had more than 12 people this year, even after the beheadings, trying to get into Syria.
What is that saying?
LAKSHMANAN: You're absolutely right, including some minors. I mean, there was a terrific piece in "The Washington Post" recently that looked at three -- you know, a sister and two brothers who were trying to go in there, two of whom were juveniles. I mean, this is a real problem, the inspiration model, and what's interesting about ISIS is, I think they've been more effective in inspiring foreign jihads --
THOMAS: Through social media.
LAKSHMANAN: Through social media, even more than al Qaeda was. When al Qaeda came out with the magazine years ago, "Inspire," everyone thought, oh, my goodness, this is how they're getting young people to join. But, in fact, ISIS has been more successful.
Now, you mentioned the military response. There have been 1,300 military strikes on is targets in Iraq and Syria. That's a lot. And yet, we haven’t destroyed this group. They're still holding firm in Raqqa and Mosul. And so, the question is, how long is going to take? I think it's striking that the president was able to pull out of Iraq, which you wanted to do, and now we're back in there again.
He's pulling out of Afghanistan but will are going to be back in there again if the Taliban re-seized or a group like ISIS takes power there?
BALZ: And to what extent have they had to re-evaluate the timetable for dealing with ISIS?
LAKSHMANAN: I think going into this, the top players, at least Secretary Kerry and President Obama, knew that this was going to be a long-term thing. I don't think any of them had illusions that they were going to destroy ISIS in a couple of months. Kerry said on the record from the start this is going to take a few years to get this done.
But I think what they're re-evaluating is how do use economic tools, how do you stop smuggling of oil over the border? This falling oil prices is one of the biggest stories of this year, Gwen, and it has affected across the board. It has also hurt ISIS because, remember, their one to two million dollars a day they were earning was largely on illegal oil sales.
So, the falling oil prices has hurt ISIS. It has hurt Russia. It has hurt Venezuela. It has hurt Iran. It has hurt a lot of our adversaries.
IFILL: Helping American consumers, there you go.
LAKSHMANAN: It has.
IFILL: Finally, as we head into a New Year, one huge unresolved dispute comes along for the ride -- race and criminal justice. From Ferguson, Missouri, to Cleveland, to Milwaukee, to New York, the Justice Department has found itself entangled in confrontations involving race, politics and policing and every time, Pierre Thomas has been in the middle of the story. Now, how many outstanding investigations do we know about that the Justice Department is in because of these outbreaks right now?
THOMAS: Right now, they're investigating Ferguson still. They’re also investigating the case in New York for the choking death. These other cases -- Cleveland and Milwaukee -- potentially could get federal investigations, as well.
I’ve not covered a story in recent memory that has struck this much emotion across the country. You literally have seen thousands of people in major cities across this country -- not just one place but across the country -- protesting police action. And part of it is a feeling, particularly in the African American community, that they don't get the benefit of the doubt in dealings with the police and that misunderstandings can result in death, if you look at both Ferguson and also the situation in New York.
What's striking is that there was not a call for any kind of violent act. It was a routine police action that turned deadly.
IFILL: But I wonder whether this doesn't make for a very difficult exit strategy for Eric Holder and an even more difficult one for the president to walk, in that on one side is the blue line, the police, law enforcement, who, of course, they're sworn to protect and actually lead. And on the other hand, are people who clearly they have some sympathies for who are blocking highways and lying down in the street and doing their best to keep, what, hundred days of protests alive?
THOMAS: Gwen, it got more complicated in the last week or so with the deaths of those officers in New York --
THOMAS: -- who were assassinated, and the person who is accused of doing it posted some things, which indicated that he was in some way locked into the protest but he's mainly a person with a violent past. He’s mainly a person with mental health issues. But, again, you have Eric Holder's name tossed into that in terms of the way you've been talking about policing may have contributed to that. I think the former governor --
IFILL: And Mayor De Blasio, the same thing.
LAKSHMANAN: Pierre, I’m struck by how damaging this is in the way to the president. I mean, this is a guy who ran on post-racial politics, his entire biography, his own story was supposed to be about transcending racial politics in this country and yet, we had a Bloomberg poll this week that showed 53 percent of Americans think that race relations are worse than before Obama took office, and 50 percent of people, according to Pew, don't approve of the way he's handling the race problems.
THOMAS: Well, this has been a difficult issue for the first African American president. Every time the issue of race has come up, even when the president has sought to calm the situation, it's been complicated for him. Again, what it tells us is that in America, race is still a prickly issue, with different vantage points. And we see that playing out over and over again.
IFILL: I don't know if he promised post-racial as much as people expected --
LAKSHMANAN: That’s right.
IFILL: -- which has put him in a box.
BALZ: You know, there's a Gallup poll that asked people what's the big issue, most important issue that's a constant question in polling. And the Gallup folks said for the first time the issue of race and racism has risen to be about the same as the economy and dysfunction in government. I mean, it is a new matrix. It's spiked over the last few months as a result of what we've seen and this gap in perceptions between white America and black America about these issues.
THOMAS: The interesting thing is that, clearly, if you look across the board, race relations are better. Look at this table. It tells you that they are better.
But there are pockets in policing, and race is one of those pockets where there's a difference of opinion based, in part, on how people have their own dealings with police. I would dare say, Dan, that your interaction with police, if you had any, have been different from mine. I had one case where I was pulled over and it was for a minor traffic violation, and suddenly, a second police officer appeared with his hand on his weapon and I was thinking, wait a minute, I’m two miles from my house, it's 8:00 p.m., why am I being treated like a criminal?
IFILL: And so many people have stories like that and that's why this doesn't go away. And I know it seems we barely scratched the surface, it’s because we did.
But we’re going to continue our conversation on our WASHINGTON WEEK Webcast Extra, where we'll sort through as much as possible in what we didn't get to, including same-sex marriage, the CIA torture report, the change in the nation’s statehouses, and what happens next when Congress returns to town. That’s not too much. It's available at PBS.org/WashingtonWeek.
And while you’re online, check out our year-end holiday reading list. Our panelists have great recommendations there for you.
And with that, we'll see you next year on WASHINGTON WEEK. Good night.