PRESIDENT BARACK OBAMA IS INTERVIEWED ON "THE AXE FILES" FROM CNN & THE UNIVERSITY OF CHICAGO INSTITUTE OF POLITIC SPEAKERS: PRESIDENT BARACK OBAMA DAVID AXELROD, HOST

AXELROD (voiceover): I first met Barack Obama when he returned to Chicago from law school in the early '90s to run a voter registration drive. And while I didn't realize at that moment where history would take him, I was taken by him, as someone who really cared about public service, was committed to devoting his life to it, and together, we had an incredible journey.

Now, as the new year approaches, the days are ticking down on the Obama administration, and so I went by the White House to sit down with my old friend and reflect on the road he's traveled.

AXELROD: So Mr. President, I actually came over to help you pack.

(LAUGHTER)

But I really appreciate you dropping by. This is a great surprise to be able to sit down with you. You know, I was over at the Kennedy Center the other night...

OBAMA: Yeah.

AXELROD: ... for the Kennedy Center Awards, and when you walked in, there was this thunderous and lengthy ovation and lots of tears. And you know me, so you know that I was among those who were -- who was tearing up. But then I was thinking, what are you thinking? And has -- is it beginning to hit you that this is coming to an end?

OBAMA: Well, let me make a couple points. Number one, you're the last guy I would have help me pack...

(LAUGHTER)

... because lets face it, orderliness is not...

AXELROD: I'd also be the last guy to offer to help, so...

(LAUGHTER)

OBAMA: So that's point number one. Point number two, they were applauding Michelle's dress, which was spectacular, even by her own standards.

(LAUGHTER)

AXELROD: OK. You're not gonna get away with that.

OBAMA: I tell you, what has started to hit me is that the collection of unbelievable talent and vision and dedication in my team, the people I've gathered around, some of whom have been with me for this entire ride, some of whom I got to know later, many of whom came of age in this job, so I've seen them start in these really junior jobs and now they're running huge operations and married and their babies are crawling on the floor of the Oval Office...

AXELROD: Right.

OBAMA: It's a family, and...

AXELROD: All named Barack.

(LAUGHTER)

OBAMA: So far, nobody's named their kid Barack. I've been a little upset about that.

But knowing that that phase is coming to an end -- they'll stay my friends for life. Some of them, I'll collaborate with, like you, on various things in the future. But to have them all in one place, to see how well they've worked together and gelled, it has been just an enormous privilege, and so I have been getting more sentimental about that.

We had our senior staff dinner, you remember these...

AXELROD: Yes.

OBAMA: ... and I got...

AXELROD: Yes. I heard you got a little verklempt.

OBAMA: Yeah, I got through about four minutes of the thing and then started, you know, getting the hanky out and...

AXELROD: Which you don't really do that much.

OBAMA: I -- I -- it's a...

AXELROD: You used to mock me for doing that.

OBAMA: Well, it's interesting. There are two things that can get me teary. One is talking about my daughters or seeing my daughters and the second is my team. I mea,n you remember after 2012 when I went over to the campaign office and I saw all those kids who had been working so hard...

AXELROD: Yeah...

OBAMA: ... and it was the same kind of emotion that stirs up this deep gratitude for their devotion and I think an appreciation that even though from their perspective, I'm the one inspiring them, in fact all I'm doing is drawing from their energy. They're the ones inspiring me. I'm reflecting back what's inside of them, which is just a lot of goodness and a lot of heart and idealism. And so that gets me choked up.

AXELROD: Well if -- if they were here, what they would tell you is right back at you because you're the one who -- I mean, everything has been organized around your energy and your sensibilities.

And you know, we talked about this when you -- when we talked about you running for president in 2006 and '07 and I said to you we haven't had a campaign that really spoke to the ideals of young people and aspirations for the future since Robert Kennedy. And that campaign stirred people in a way that very few have, and we did that -- you did that, and you know, only you could have done it. And so...

OBAMA: Look, the point is, it feels like the band is breaking up a little bit. And it really has been a team effort, it's been a really big band, a full orchestra.

AXELROD: Yes.

OBAMA: Horn section and all that. And one of the things that I tell people I appreciate is that -- that spark, that thing that we took a flyer on in 2007, 2008. You know, it didn't always manifest itself in the day to day grind of governing, but the truth is it's -- it never died out. And I would continue to see it every day in what happened here in the West Wing and the East Wing and the White House. The idealism and the dedication stayed with the staff and got us through some really hard times.

And so, I do take a lot of pride in the fact that overall, this place never got cynical over the eight years. There were times where we were aggravated. There were times where we were frustrated. There was gallows humor, but we -- we never had that fire snuffed out and that is a point of pride for me because what that tells me is there's a whole generation of people who worked in this administration who are going to keep on doing stuff...

AXELROD: Yeah.

OBAMA: ... in the future. I don't think they come away from this feeling like government service doesn't work...

AXELROD: Well...

OBAMA: ... politics is terrible.

AXELROD: The result of the election actually has stirred what I think is an encouraging reaction, which is this stuff matters, we can't walk away -- we can't walk away from it.

Let me take you back because what I was thinking about last night as I was thinking about this conversation was how remarkable your personal journey has been. I -- I sort of got to jump on the train and we -- we had this trip together, but you know, when I think back to -- I always love that story about after you lost your congressional race by what, the narrow margin of 30 points or something...

(LAUGHTER)

OBAMA: That was a nail biter.

AXELROD: But you...

OBAMA: I think it was literally called like two minutes after the polls closed.

AXELROD: Yeah. Well, that's good, you didn't have to waste the whole evening.

OBAMA: No, but I had to rush to get to the hotel to concede.

(LAUGHTER)

I thought I was going to have half an hour. I had to put my tie on...

AXELROD: But -- but tell the story about going to L.A. for the Democratic Convention and trying to rent a car.

OBAMA: Yeah, this is...

AXELROD: This was 16 years ago.

OBAMA: Yeah, this was 16 years ago. So -- so, I just got thumped in a congressional race and the truth is that it was a great experience for me. It ended up being a building block for subsequent races. It taught me a lot.

But look, losing's never fun. The one thing I always explain to people is although, I -- I've -- I'm proud that I have tried to conduct myself in office to do what I think is right rather than what is popular, I always tell people don't underestimate the public humiliation of losing in politics. It's unlike what most people experience as adults, this sense of rejection.

AXELROD: Yeah.

OBAMA: And so, you're already a little mopey about things, and as you know, David, because we're close friends, Michelle was never that wild about me going into politics.

AXELROD: Right.

OBAMA: I've got -- I've got two little kids, we're pretty broke, or at least at that point I had one little kid and one on the way. And a friend of mine says, "Look, you've got to get back on the horse. You're kind of down in the dumps. Why don't you go to the Democratic National Convention in L.A.? It'll cheer you up. You'll be among folks who are excited about politics and you can stay with me."

And I said OK. You know, I'll go for the weekend. I fly out there on whatever connecting flight that was the cheapest and get to the rent-a-car place and present my credit card and the credit card's rejected. No more money. So...

AXELROD: Aftermath of the campaign?

OBAMA: Right. So I have to I think make a couple of calls to engineer somehow renting this car and I get to the hotel where my friend is ready to go and we go over to the convention and they give me the pass that is -- basically only allows you to be in the halls, like the ring around the auditorium.

(LAUGHTER)

Didn't actually allow you to see anything, but you could wander around and...

AXELROD: This is four years before you gave the keynote speech...

OBAMA: This is -- yes, and -- and I think they'd -- my friend would try to get me into some of the after parties after the convention and bouncers would be standing there saying, "Who's this guy?" And "He doesn't have the right credentials."

AXELROD: So, this probably didn't have the cheering up effect...

OBAMA: It didn't. I -- I felt as if I was a third wheel in this whole thing, so I ended up leaving early and...

AXELROD: At least (inaudible) the car.

(LAUGHTER)

OBAMA: And I -- and that was a stage when I was really questioning whether I should continue in politics.

AXELROD: Yeah. I was going to mention that because I remember when you called me in 2002 to say you were thinking of running for the Senate and you said, you know, I've talked to Michelle about this. I've got one race left in me, and if I don't win it...

OBAMA: Up or out.

AXELROD: ... then I'm going to go out and make a living and forget about this. So that's how close you came to being out of politics.

OBAMA: Yeah, no, it was -- it was an interesting moment. And you know, since this is your podcast, I might as well give you a little credit. I think, in our conversation, you were initially and sensibly skeptical about...

AXELROD: A black guy named...

OBAMA: A black guy...

AXELROD: ... Barack Hussein Obama getting elected to the Senate. Yeah, I was.

OBAMA: Yes, but you overcame your skepticism. And -- and I saw a possible path.

The one thing that the congressional race had done is confirm in my mind two things. Number one, even though in a predominately black district, I had been beaten badly by a well-established African American politician, it was interesting when I went out campaigning, people were actually pretty encouraging.

What they'd say is, you seem like a great young man and you're gonna do great things, it's just it's not your turn yet. So what they told me was actually that I had strong support in the African American community, just not in this particular race.

And the second thing, as you'll recall, in that congressional race, there was a chunk of the city, of the congressional district, Beverly Morgan Park, where there was a sizeable Irish population. And I did really well there...

AXELROD: You did, yeah.

OBAMA: ... and I connected well. And it -- it told me that in a big field, in the U.S. Senate race, that I might have a chance to win, so. But -- but it is...

AXELROD: If you had won that congressional race, we wouldn't be sitting in the Roosevelt Room right now.

OBAMA: No, we wouldn't. So things -- things work out.

But -- but I do always think about the fact that in the 2000 convention, I couldn't basically get in the hall -- or I couldn't get into the -- on the floor and nobody knew my name. Four years later, I'm doing the keynote speech. And it wasn't as if I was so much smarter four years later than I had been in 2000, it speaks a little bit to the randomness of politics.

And you know, part of the reasons that I think I've stayed sane in what has been this remarkable journey, and you've known me a long time and I think you'd confirm that I'm pretty much the same guy as I was when we started this thing. Part of the reason...

AXELROD: A little grayer, but yeah.

OBAMA: Part of the reason -- a little grayer, yes. But part of the reason for that I think is because, you know, success came late to me, notoriety came late. And it -- it made me realize that to the extent that I had been successful, it wasn't about me. It was about certain forces out there and -- and me hitching my wagon to a broader spirit and a broader set of trends and a broader set of traditions.

And so, when -- when we came up with the phrase Yes, We Can, which again, to give you credit I was a little skeptical of, it felt a little simplistic when we first started. But...

AXELROD: You didn't like the logo either, but that's -- that's a different discussion...

(CROSSTALK)

OBAMA: The logo I thought was a loser, it looked like the Pepsi logo and I thought...

AXELROD: That's what you said, that's...

OBAMA: ... that seems a little...

(CROSSTALK)

AXELROD: That's what you said, it became more iconic than the Apple insignia. So -- I'm glad we straightened this out...

OBAMA: But look, I...

AXELROD: I've gotten everything I wanted...

(CROSSTALK)

OBAMA: That's what I figured.

(LAUGHTER)

OBAMA: But -- but what Yes, We Can described and I really meant was that this was not simply about me, that this was about us.

AXELROD: Yes. And I think that was well understood and that was what was so energizing about it.

So I want to ask you, you talk about your sanity. I want to know why you're not nuts, OK? And this is the reason, most politicians, you talked about how hard losing is.

OBAMA: Right.

AXELROD: Most politicians have some sort of wound, I find, especially at a higher level that something happened in their childhood and they really need the approbation of the crowds and the affirmation that comes with being elected.

I don't know if you remember this conversation I had with you when you were -- when you came to my office, right? You got back from Hawaii, you're about to make the decision to run, you come in unannounced and we talked for a long time. And I told you, I'm not sure you're pathological enough to run for president.

(LAUGHTER)

And what I meant by that was I didn't think you had that sort of pathological need that so many people who run for president do. And I don't know why that is because your dad abandoned you basically when you were two years old. And your mom -- I know she was very loving, but you were separated from her for long periods of time. And if you were just looking at those facts, you'd say yeah, this guy's gonna be a real needy person.

OBAMA: Yeah.

AXELROD: Why are you -- why didn't you turn out that way?

OBAMA: Look, you know, you don't know -- it's hard to get outside of yourself completely and evaluate all the factors that contribute to your character. Some of it is just temperament. Now that we've been parents and you're a grandpa, you start noticing, there is an essence of each kid that barring really severe trauma expresses itself. That's who they are.

And so there is something in me, obviously, that is pretty calm and generally pretty happy and pretty buoyant. But...

AXELROD: Did you feel -- did you feel -- I mean, this is a weird question to ask because you're president of the United States. But did you feel loved as a kid, even though you're...

OBAMA: I did. And...

AXELROD: And why, was it your grandparents?

OBAMA: No, my mom was -- she was eccentric in many ways. She was...

AXELROD: Kind of a hippie, right?

OBAMA: Yeah. Yeah, but she always insisted on shaving her legs.

(LAUGHTER)

But she was -- she was somebody who was -- was hungry for adventure and skeptical of convention. But she loved the heck out of her kids. And both my sister and I...

AXELROD: That's what your sister says too. I asked her this question.

OBAMA: For all -- yeah, for all the ups and downs of our -- our lives, there was never a moment where I didn't feel as if I was special, that -- that I was not just this spectacular gift to the world. And that's what you want your moms...

AXELROD: Yeah, of course, yeah.

OBAMA: ... and your dads to -- to give to your kids.

AXELROD: So even -- even when you -- when she was overseas and you were with your grandparents, she communicated with you (ph).

OBAMA: Yeah. And -- and I never doubted her -- her love and commitment for me. And she was so young when she had me. I mean, she was -- she was 18, right? So in some ways, by the time I was 12, 13, she's interacting with me almost like a friend as well as a parent. Now, there...

AXELROD: And you guys also weathered a lot together.

OBAMA: Yeah ,and I didn't always necessarily handle that well. It's not sort of a recipe for ideal parenting. But what I did learn was that unconditional love makes up for an awful lot, and I got that from her. Now, a part of -- a part of -- going back to the question about politics, though...

AXELROD: You never feared losing.

OBAMA: I never...

AXELROD: You didn't like it...

OBAMA: No.

AXELROD: You're competitive.

OBAMA: I am.

AXELROD: I've -- I've...

OBAMA: You know -- you know what it was, David, and I think has remained true, is it's not that I didn't fear losing, it's that I feared more being dishonest or being a jerk or losing respect for myself. I feared that more than losing.

AXELROD: So, subjugating those things that you felt were important in order to win?

OBAMA: Exactly. The -- the story I tell about myself didn't allow me to say oh, well let's trim my sails here for expediency. And -- and so, at the end of the day, I think that part of sustaining my sanity through this thing was having gone through enough growing up and community organizing and not being in the spotlight and having had this weird 15 minutes of success at Harvard and being president of the law review...

AXELROD: You were president of law review.

OBAMA: ... but then going back into the state legislature where I'm operating in obscurity.

And those ups and downs meant that by the time I was elected to the Senate and suddenly, as you pointed out at the convention, shot out of a cannon into this unreal world, by that time I was pretty fully formed, had a pretty good sense of who I was, had a good sense of what was important and what wasn't.

And look, I was also married to a woman who was not going to put up with any foolishness, and you know, Michelle, I can't underestimate the degree to which having a life partner who is so grounded and so strong and steady and fundamentally honest helped.

AXELROD: Sometimes brutally so.

OBAMA: Sometimes brutally so, but...

AXELROD: Yeah. No, I -- I...

OBAMA: But it -- it -- she has been ballast for our family.

AXELROD: Yeah.

OBAMA: And I -- no doubt contributed to me feeling calm because here's what I knew about Michelle the same way I knew about my girls or my sister or my best friends. Their relationships with me never depended on my success or outward success. They didn't -- my best friends from high school don't operate any differently with me now than they did when I was...

AXELROD: And they're around a lot. You -- you have them here a lot.

OBAMA: I do, yeah.

AXELROD: They don't call you Mr. President.

OBAMA: They do not.

AXELROD: Yeah.

OBAMA: Yeah. That's -- I mean, you know, I've been lucky. It's interesting. As you get older, you figure out some things you're good at and some things you're not. You have hopefully a better self assessment of yourself. And one gift I do seem to have is getting really, really good friends around me who've got my back. And that gives you a certain serenity in the midst of a lot of foolishness.

AXELROD: We -- you've rebuilt the American economy from when we came here, and as a result, I have to take a word from our sponsor here.

(COMMERCIAL BREAK)

AXELROD: One other element -- one other element -- I want to talk about the 2004 speech, which to me, is foundational for almost everything that came after. But before I do, I just have one other question about your sort of makeup that I think is sort of central to your success and one mystery to me even though we've been friends for like 25 years.

What -- how is it that you sort of just made the decision in the middle of your years in college that you were going to sort of transform yourself from a guy who enjoyed a party and was kind of a goof-off at Occidental College to kind of becoming an ascetic at Columbia with a much more purposeful view of -- I mean, that's an unusual thing as well.

OBAMA: Yeah.

AXELROD: I mean, it's a disciplined...

OBAMA: Yeah. Some of this, I think, is just a kid growing up and it turns out -- and I see this in my own daughters. People go at their own pace, right?

So, I don't think that the more serious side of me sprang up overnight. I think it had been building. It just took longer to manifest in me than it might have in some other kids. This may be an area where the lack of structure during my high school years because my mom wasn't always around, my grandparents, they're older, they're not as strict and paying attention. I'm sort of raising myself...

AXELROD: Right.

OBAMA: ... meant...

AXELROD: Well, that -- that's what strikes me.

OBAMA: Yeah, well what it meant was that -- what -- the kind of discipline that I see in my daughters developing at 15 or 16 took me until I was 20 or 21 because there wasn't somebody nagging me and giving me some perspective the way Michelle and I are able to give my daughters...

AXELROD: Was there one transformative event?

OBAMA: No, I don't think so. It was just sort of gradual.

The two other things that started happening that I think are relevant; one was I became more socially conscious at Occidental even though I was partying, anti-Apartheid movement, starting to be interested in social policy and poverty and starting to study civil rights even if through the haze of a hangover.

(LAUGHTER)

So -- so, that starts giving me a sense of what a purposeful life might look like. That becomes tied up with my racial identity. I start thinking about what it means to be not just a man, but a black man in America and how do you forge dignity and respect in a society that's still troubled by -- by the question of race. And then, my father dies unexpectedly, but that doesn't happen until a little bit later.

What does start happening is the awareness that I don't know him, and so I'm not going to get that much direction from him but I start needing to understand better my genesis, where'd I come from, all these things just made me brood a little bit more. And so, physically I remove myself from my old life, I go to New York. And it's true, I live like a monk for three or four years, take myself way too seriously. There's this huge...

(CROSSTALK)

AXELROD: That's part of being young, too.

OBAMA: Yeah, exactly. Huge overcompensation, I'm humorless, and you know, have one plate and one towel and, you know, and -- and fasting on Sundays, and you know, friends start noticing that I'm -- I'm begging off (ph) going out, you know, at night because I have to, you know, read, you know, Sartre (ph) or something.

You know, so in retrospect, wildly pretentious. And when I read back old journals from that time, because I'm starting to write, or letters that I've written to, you know, girls you're courting or something, they're impenetrable. I mean, I don't -- I don't understand what I'm saying, right?

(LAUGHTER)

There's all kinds of references to (inaudible) and France penon (ph) and all this stuff and I'm like what -- what are you talking about?

AXELROD: But those are cool pick up lines, I bet.

OBAMA: They didn't work, I think, because people were all like wow, this guy is just too intense.

(LAUGHTER)

He needs to lighten up. I should've tried like, you know, wanna go to a movie or...

AXELROD: Yeah, those are good too.

OBAMA: ... go on a picnic?

AXELROD: Or get a -- or get a dog, that always works.

OBAMA: Exactly (ph).

AXELROD: So let me -- let me return to 2004. You made -- you know, I remember when you wrote this speech, in fact when you got the call that you were gonna do it, you hung up the phone and you said I know what I wanna say. And I said what do you wanna say? You said, I wanna tell my story as part of the largest American story and you did.

OBAMA: Right.

AXELROD: And it was a very -- it was just galvanic because people in a country that was riven heard a message about one American community in which we have different stories, but we have shared aspirations, values. And you know, there is no black America, you know...

OBAMA: Right. I remember.

AXELROD: You know, all of that, yeah you -- you wrote it.

OBAMA: It was a pretty good speech.

AXELROD: So -- it was a good speech. And -- and you went right out to the notion of a red America and a blue America. So you know where I'm going, here.

OBAMA: Yes, I do.

(CROSSTALK)

AXELROD: How -- how...

(CROSSTALK)

OBAMA: How's that worked out for you?

AXELROD: Yeah, exactly.

OBAMA: The whole hope you change you (ph) thing?

(LAUGHTER)

AXELROD: Exactly. Where -- I mean, you've accomplished an enormous amount here.

OBAMA: Yeah.

AXELROD: And I'm -- you know, I mean, I'm so proud of you.

OBAMA: Thanks.

AXELROD: But the -- you know, the premise of our campaigns, both in 2004 and 2008, were that we could overcome these differences. And what happened?

OBAMA: Well, look, a couple of things. The -- you're right about that speech, I knew what I was gonna write because essentially I had been off Broadway practicing during that Senate race, because I had been traveling through not just Chicago, but downstate Illinois.

AXELROD: These old factory towns, yeah.

OBAMA: Old factory towns, you know, you're in the quad cities, you're in Cairo, you're in, you know, places that, you know, people would've assumed I couldn't connect. But as I've said before, it felt actually pretty familiar to me because they were my grandparent's culture in many ways.

AXELROD: Yeah, from Kansas.

OBAMA: From Kansas. And so -- so a lot of the lines of that speech in 2004 were really just a pulling together of what I had been feeling, what I had been seeing, the conversations I'd been having.

AXELROD: And you told stories of people you met along the way.

OBAMA: Yeah, during the course of that couple of years. And so we both anticipated that it was -- would do well. I don't think any of us anticipated the electric impact that it had...

AXELROD: I did about five minutes in. I could see what was going on, there.

OBAMA: Yeah, but -- but I -- I always viewed that as an aspirational speech, not a perfect description of what is but a description of our best selves and who we might be, that the reality of our common cause and how it connected to our best traditions, starting with the Constitution through the fight for abolition, through the Civil Rights era, the Women's Movement.

(CROSSTALK)

OBAMA: ... for unionization. And you know, the image of, you know, of -- of melting pot army during World War II.

AXELROD: Right.

OBAMA: You got the Italian guy and you got the, you know, Polish guy and suddenly they're all becoming one unit fighting fascism, right? There's always been a mythology around that. There's always been an uglier set of impulses in America, exterminating Native Americans for their lands and slavery and Jim Crow and...

(CROSSTALK)

AXELROD: And by the way, resistance to Doris Kearns Goodwin, who we both know and love, was -- showed me a speech by Henry Cabot Lodge in 1896 castigating Irish immigrants and Polish immigrants...

OBAMA: Exactly.

AXELROD: ... in the same terms that we've heard in this last campaign.

OBAMA: Exactly. So -- so the point was not to bury that ugliness, but to say that there is this trajectory, the arc of the (inaudible) universe is long. It ends towards justice. It is a struggle, but there's this thing in us, there's this thing in this country that is good and unifies us. And ultimately, will win out. That was the speech.

Now, I would argue that during the entire eight years that I've been president, that spirit of America has still been there in all sorts of ways. It manifests itself in communities all across the country. We see it in this younger generation that is smarter, more tolerant, more innovative, more creative, more entrepreneurial, would not even think about, you know, discriminating somebody against for example because of their sexual orientation.

You know, all those things that I describe, you're seeing in our society, particularly among 20-year-olds, 30-year-olds. But...

AXELROD: But obviously, the...

OBAMA: But what I think we also saw is that the -- the resistance to that vision of America, which has always been there, was always powerful, mobilized and asserted itself powerfully.

Now, I would argue that in part, very cynically, somebody like a Mitch McConnell or Roger Ailes at Fox News I think specifically mobilized a backlash to this vision in order to accomplish pretty routine, commercial or power...

(CROSSTALK)

AXELROD: Well, let me try something out on you (ph). I mean, my sense is that McConnell, just as a clinical political matter, recognized the power of your message and figured out very quickly -- and he's pretty much said this -- that if we were to cooperate, it would've meant that he had figured this out.

OBAMA: It would've validated this vision and it would've reinforced it and -- and it would have, I think, consolidated itself for a generation or two. And so Mitch McConnell's insight, which I've -- I've said, just from a pure...

AXELROD: Yeah, right.

OBAMA: ... tactical perspective, was pretty smart and well executed, the degree of discipline that he was able to impose on his caucus was impressive. His insight was that we just have to say no to that. And if we can just throw sand in the gears, then at a time of deep economic crisis, when people are really stressed, really worried, we're already stressed and worried before the crisis, now are thinking the -- the bottom's falling out of their lives and their home prices are going down, their 401(k)s are evaporating, they're losing their jobs.

That if we just say no, then that will puncture the balloon, that all this talk about hope and change and no red state and blue state is -- is proven to be a mirage, a fantasy. And if we can -- if we can puncture that vision, then we have a chance to win back seats in the House and...

AXELROD: Which they did.

OBAMA: And -- and win back seats in the Senate. And -- and so, I understand what happened politically.

Two points I would make though, David, because obviously in the wake of the election and Trump winning, a lot of people have -- have suggested that somehow, it really was a fantasy. What I would argue is, is that the culture actually did shift, that the majority does buy into the notion of a one America that is tolerant and diverse and open and -- and full of energy and dynamism.

And -- and the problem is, it doesn't always manifest itself in politics, right? You know, I am confident in this vision because I'm confident that if I -- if I had run again and articulated it, I think I could've mobilized a majority of the American people to rally behind it.

I know that in conversations that I've had with people around the country, even some people who disagreed with me, they would say the vision, the direction that you point towards is the right one.

AXELROD: We're gonna take another short break and we'll be right back with the president.

(COMMERCIAL BREAK)

AXELROD: Well, (inaudible) Trump, as you know, Trump, Obama voters. There were people -- he won 200 counties that you -- that you won and many of them are in these more rural or small town communities. Did you think -- you always had an overarching message and it had an economic component to it, a very heavy economic component to it. Should this campaign have had that?

OBAMA: Look, you know, I think that Hillary Clinton performed wonderfully under really tough circumstances. I've said this publicly, I'll repeat it. I think there was a double standard with her. For whatever reason, there's been a longstanding difficulty in her relationship with the press that meant her flaws were wildly amplified relative to...

(CROSSTALK)

AXELROD: But leaving that aside...

OBAMA: But -- but -- well, the reason I bring this up is because we've both been in campaigns. If you think you're winning, then you have a tendency, just like in sports, maybe to play it safer.

And the economy has been improving. There is a sense, obviously, that some communities have been left behind from the recovery and people feeling anxious about that. But if she was looking at the campaign and saying OK, I'm winning right now, and her economic agenda was in fact very progressive. But...

(CROSSTALK)

OBAMA: No, you're right, not well understood. But understandably, I think she looked and said well, given my opponent and the things he's saying and what he's doing, we should focus on that.

In retrospect, we can all be Monday morning quarterbacks. Here's what I -- here's what I would say prospectively, is that the Democratic agenda is better for all working people. This division that's been put out there between white working class versus black working class or Latino working class -- look, an agenda of raising minimum wage, rebuilding our infrastructure, you know...

AXELROD: Education.

OBAMA: Education, family leave, community colleges, making it easier for unions to organize, that's an agenda for working class Americans of all stripes. And we have to talk about it and we have to be present in every community talking about it.

See, I think the issue was less that Democrats have somehow abandoned the white working class, I think that's nonsense. Look, the Affordable Care Act benefits a huge number of Trump voters. There are a lot of folks in places like West Virginia or Kentucky who didn't vote for Hillary, didn't vote for me, but are being helped by this.

AXELROD: Right.

OBAMA: The -- the problem is, is that we're not there on the ground communicating not only the dry policy aspects of this, but that we care about these communities, that we're bleeding for these communities...

AXELROD: Right.

OBAMA: ... that we understand why they're frustrated. There's a -- there's a...

AXELROD: And the values behind these things.

OBAMA: And the values. And there's an emotional connection, and part of what we have to do to rebuild is to be there and -- and that means organizing, that means caring about state parties, it means caring about local races, state boards or school boards and city councils and state legislative races and not thinking that somehow, just a great set of progressive policies that we present to the New York Times editorial board will win the day. And -- and part of...

AXELROD: But some of that would fall on us. I mean, I -- take you and me because maybe we didn't spend as much time on that project while you were here. I mean, we're trying to save the economy and doing these other things.

OBAMA: Well, yeah. No, you know, I mean...

AXELROD: Our campaigns did it, but...

OBAMA: It's interesting. You and I both, I think, would acknowledge that when we were campaigning, we could connect. Once you got to the White House and you were busy governing, then...

AXELROD: Right.

OBAMA: ... partly, you're just constrained by time, right? You are then more subject to the filter. And this is -- you know, I brought up Fox News, but it was Rush Limbaugh and the NRA and there are all these mediators who are interpreting what we do, and if we're not actually out there like we are during campaigns, then folks in -- in a lot of these communities, what they're hearing is Obama wants to take away my guns...

AXELROD: Right.

OBAMA: Obamacare's about transgender bathrooms and not my job, Obama is disrespecting my culture and is primarily concerned with coastal elites and minorities. And so -- so part of what I've struggled with during my presidency and part of what I think I'll be thinking a lot about after my presidency is how do we work around all these filters?

And it becomes more complicated now that you've got social media, where people are getting news that reinforces their biases and -- and separates people out instead of bringing them together. It is going to be a challenge, but look, you look at what we did in rural communities, for example...

AXELROD: Yeah, yeah.

OBAMA: Just from a policy perspective...

AXELROD: Yeah, ask Tom Vilsack. He feels very strongly...

OBAMA: Tom -- Tom Vilsack, my agriculture secretary from Iowa. We -- we devoted more attention, more focus, put more resources into rural America than has -- has been the case probably for the last two, three decades.

AXELROD: Right.

OBAMA: And -- and it paid great dividends, but you just wouldn't know that, that's not something that you would see on the nightly news. And so we've got to figure out how do we show people and communicate in a way that is visceral and -- and makes an emotional connection as opposed to just the facts...

AXELROD: I...

OBAMA: ... because the facts are all in dispute these days.

AXELROD: I think -- I personally think that part of the problem was sometimes, we become a slave to our own technology and politics. And you say well, we've got this group, this group and this group, and so we have the coalition we need to win. And if you misuse that...

(CROSSTALK)

AXELROD: ... you send the message to everybody else...

OBAMA: This (ph) microtargeting.

AXELROD: ... we don't really need you.

OBAMA: Well, part of what I've been saying to -- to people, and this was even when I thought we were gonna win, was that -- that narrow Democratic coalition, the quote/unquote "Obama coalition," that if -- if properly executed, yes you can probably win presidencies repeatedly. It constitutes the majority of the country, but you can't govern.

So part of the challenge for Democrats and progressives generally is that if we cannot compete in rural areas, in rural states, if we can't find some way to break through what is a complicated history in the south and start winning races there and winning back southern white voters without betraying our commitment to civil rights and diversity, if we can do those things, then we can win elections. But we will see the same kinds of patterns that we saw during my presidency, a progressive president but a gridlocked Congress that can't move an agenda for us.

AXELROD: Just a couple more things. Are you worried about the Corbynization (ph) of the Democratic Party? Saw the Labor Party just sort of disintegrated in the face of their defeat and move so far left that it's, you know, in a very -- in a very frail state. And there is an impulse to respond to -- to the power of Trump by, you know, being as edgy...

OBAMA: On the left.

AXELROD: ... on the left.

OBAMA: I don't worry about that, partly because I think that the Democratic Party has stayed pretty grounded in fact and reality. Trump emerged out of a decade, maybe two, in which the Republican Party, because it had to say no for tactical reasons, moved further and further and further away from what we would consider to be a -- a basic consensus around things like climate change or how the economy works.

And it started filling up with all kinds of conspiracy theorizing that became kind of common wisdom or conventional wisdom within the Republican Party base. That hasn't happened in the Democratic Party. I think people like the passion that Bernie brought, but Bernie Sanders is a pretty centrist politician relative to...

AXELROD: Corbyn.

OBAMA: Relative to Corbyn or relative to some of the Republicans.

AXELROD: Oh I see what you're saying...

OBAMA: And -- and so -- so I don't worry about that. What I do worry about is that in an era where we are looking for simple solutions that -- and want 1000 percent of what we want and when we want it, that we end up starting to shut ourselves off from different points of view, shutting down debate, becoming more dogmatic, becoming more brittle.

And I don't see that being a successful strategy for us winning over the country. Remember, we won the popular vote. You know, we don't have very good population distribution from a Democratic perspective, right? So I've told the story about how I was in Brooklyn campaigning, I think for De Blasio, and this woman comes up, hugs me, how can we help you, we love you, I said move to Nebraska.

(LAUGHTER)

You know, I got a million...

AXELROD: She obviously didn't.

OBAMA: ... wasted votes in -- in Brooklyn.

AXELROD: Well, let me -- let me before you go because you've been real generous with your time, here. What about you? You know, I see this conflict coming down the line here, which is you -- you once told me that you admired the Bushs for the way they've handled their post-presidency in the sense that they gave you the room that you needed to do what you needed to do. And I know you feel strongly about that.

On the other hand, people are kind of looking to you now to be kind of the point of the spear in the resistance to this new administration and -- and partly because of the absence of anybody else, but...

OBAMA: Well, I think -- look, my -- my intentions on January 21st is to sleep, take my wife on a nice vacation, and she has said it better be nice.

(LAUGHTER)

Because she's -- she's earned it.

AXELROD: She deserves it.

OBAMA: She deserves it. I'm gonna start thinking about the first book I -- I want to write. We've got to unpack, and -- and I don't need your help on that either.

(LAUGHTER)

And -- and look, I have to -- I have to be quiet for a while. I -- I -- and I don't mean politically, I mean internally. I have to still myself and...

AXELROD: That's gonna take some time.

OBAMA: Yes.

AXELROD: It's hard to leave here...

OBAMA: It does.

AXELROD: I know in some small way what that's like.

OBAMA: Yeah. So -- so you just have to -- you have to get back in tune with your center and -- and process what's happened before you make a bunch of good decisions.

With respect to my priorities when I leave, it is to build that next generation of leadership; organizers, journalists, politicians. I see them in America, I see them around the world, 20-year-olds, 30-year-olds who are just full of talent, full of idealism. And the question is how do we link them up? How do we give them the tools for them to bring about progressive change? And I want to use my presidential center as a mechanism for developing that next generation of talent.

That's my long-term interest because I don't want to be the guy who's -- you know, I joke I'm like the old guy at the bar, you know, who's -- who's just hanging around re-living old glories. No, I -- it's...

AXELROD: The good news is I think everybody will buy you drinks.

(LAUGHTER)

OBAMA: It -- it -- I want to make sure that I'm doing everything I can to -- to amplify and lift up a next generation of voices not just in politics, but in civic life. And I -- I have the connections and I think credibility to -- to be able to do that in some unique some ways.

Short-term with respect to the Democratic Party, I think even before I leave here, what I can do is give people some sense of direction, and -- and we already started talking about this. I think what I can do is not do it myself, but say to those who are still in the game right now look, think about this, think about how you're organizing that, you know, what are you doing to make sure that young talent is out there in the field being supported. You know, how are you making sure that your message is reaching everybody and not just those who have already been converted.

Identifying really talented staff and organizers who are already out there and -- and encouraging them to get involved.

So I -- I think over the next 45 days, what I can say is here's how I would do it if I were sticking around, but I'm not sticking around. I -- by virtue of the Constitution and because I believe in the wisdom that George Washington showed, that at a certain point, you make room for -- for new voices and fresh legs.

Now, that doesn't mean that if a year from now or a year and a half from now or two years from now, there is an issue of such moment, such import, that -- that isn't just a debate about a particular tax bill or, you know, a particular policy but goes to some foundational issues about our democracy that I might not weigh in. You know, I'm still a citizen and -- and that carries with it duties and obligations.

But -- but the day-to-day scrum, that's not only -- not only is it contrary to tradition for the ex-president to be involved in that, but I also think would inhibit the development of those new voices. And I know they're out there; I've seen them. You know them too, it's just...

AXELROD: I do.

OBAMA: There's a little bit of a generation gap, you know? The -- in some ways, we...

AXELROD: There are some great leaders (inaudible).

OBAMA: Yeah, it's just that they're -- they haven't quite gotten to prime age yet and what we want to do is maybe accelerate their presence on the -- on the scene, and that's where I can be helpful, shine a spotlight on all the great work that's being done and all the wonderful young Americans who will help lead the way in the future.

AXELROD: Well, I would be remiss if I didn't tell you that I love you, man, and I'm so...

OBAMA: Love you back, brother.

AXELROD: ... so grateful. I told you at the end of the 2012 campaign that you gave me the greatest gift because you helped renew my idealism.

OBAMA: Yeah, you were getting a little cynical.

AXELROD: Yeah. And -- and I -- and I think you've done that for a lot of people, and that's the greatest gift you can bestow. So on behalf of all of us...

OBAMA: I appreciate that.

AXELROD: ... I want to say thank you for your wonderful service.

OBAMA: It's been a pretty good ride.

AXELROD: Great ride.

END