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Hello, Kathy Novak with the latest from the newsroom. Snap polls have awarded Barack Obama victory in the second US Presidential debate. His performance a sharp turnaround from his lacklustre showing at the first debate. Governor Romney doesn't have a five-point plan. He has a one-point plan, and that is to make sure that folks at the top play by a different set of rules. If the president were re-elected we'd go to almost $20 trillion of national debt. This puts us on a road to Greece. The Prime Minister's blamed her high heels for a spill during her trip to India, where she discussed potential uranium exports and hinted at closer defence ties. And Matt White's been sacked from his part- time job at Cycling Australia after he owned up to his role in the Lance Amstrong doping scandal. And I'll have a full World News Australia bulletin at 10:30.

I saw him in the fall of 2010,
right before the elections.

We sat in the Oval Office
for an hour or so.

And he clearly knew what was
happening, he knew what was coming.

He knew things were not
going to go well on election day.

But he also recognised
mistakes he'd made along the way,

and he felt like he could
have done things differently

and argued that it was almost
inevitable there would be a backlash

as he tried to do big things
in the conditions he was facing.

The White House didn't see
the midterm elections

as the end of their ability.

He is heading
into a midterm election

in which he felt like he had been
mischaracterised, misconstrued

like many presidents he
said the problem was of communicatio

more than the actual substance
of what he had decided.

And they drifted right into
the November elections

without really changing much
of the way they operated.

He knew
the midterms would be hard.

We ended every speech with
"Change isn't easy, change is hard,

"none of this will be done
overnight." It was a constant theme.

Two years after Obama's election,

the predicted defeat
is of historic proportions.

It's an electoral
landslide unseen since 1938.

Nobody knows what Barack Obama
wants to do or can do

with what remains of his presidency.

The Republican objective is clearer;
prepare his defeat in two years time.

Midterms were a referendum on
him, on the economy,

a devastating defeat.

The midterms were
kind of a natural reaction

to the administration for sure,
obviously.

It was definitely an election where
the Tea Party really dominated.

I mean,
the electorate for that election

was really atypical, I think,
for a midterm.

The Republican leader
of the Senate,

right after the election in 2010,

with two more years left for the
president in his term, first term,

said his chief goal was to make
sure that Obama was not re-elected.

Can you imagine that?

The White House has been furious
about this,

including President Obama who gave
a very angry press conference

after the November 2010 defeat.

President Bush, when he
went through a similar thing,

came out and said
this was a thumpin'.

You talked about
how it was humbling,

or you alluded to it
perhaps being humbling.

And I'm wondering, when you
see 19 state legislatures

go to the other side,
the Democratic Party set back...

are you willing to concede at all
that what happened last night

was not just an expression of
frustration about the economy

but a fundamental rejection
of your agenda?

What does it feel like?

It feels bad!

You know,
I can tell you that, you know,

some election nights are more fun
than others. Some are exhilarating.

Some are humbling.
There is not only sadness,

but there is also a lot of
questioning on my part

in terms of "Could I have done
something differently or more..."

It's hard. I'm the President
of the United States.

And so I think I've got to
take direct responsibility

for the fact that we have not made
as much progress as we need to make.

We're going to have to do
a better job.

It's not been managed by me
as well as it needed to be.

And in the rush of activity,
sometimes we lose track.

And that's something that...

Now, I'm not recommending
for every future President

that they take a shellacking
like I did last night.

You know, I'm sure there are
easier ways to learn these lessons.

The first phase of his presidency
was over, you know,

the phase where he thought he could
do big things and change the country

devolved into a sort of...

house by house urban combat
situation with Republicans

in which he was fighting
for scraps and small things.

Whenever he did go for something big

invariably it seemed to
collapse around him.

He starts to lose the understanding
of the American people.

It's like there's
this miscommunication.

You have to look at that
as a repudiation of some sort,

and at the very least
a failure to translate

what you are trying
to communicate to the country.

He is weak in communicating his
achievements to the American people.

I think he's not done a good job
explaining, for example,

the benefits
of the health insurance reform bill.

And I think the opponents,
the adversaries of that legislation

have occupied the space and we
should have done a much better job.

They were very ineffective in
their communications.

One of the most tedious
and prolonged complaints

and debates inside the White House

was how come
their communications were so bad?

They knew it internally; they knew
it at the presidential level.

The president and his wife argued
about it endlessly.

Michelle Obama's involvement
in the West Wing

is very powerful but very subtle.

Her influence was powerful
but very indirect.

It was the president
who said to his advisers...

you know, that Michelle was
really angry with what had happened,

that she felt as if the team's
rudder was not set straight.

She saw disorganisation,
she saw a kind of lack of planning.

Inside the White House
it wasn't always clear

whether she was saying those things

or he was using her
as something to hide behind.

"My wife's giving me a hard time,

"she thinks
we're not doing a great job".

It sounds better than "I don't think
you're doing a great job."

She's a really strong personality,

I think really strong woman, right,
and mother and wife,

and she's a kind of a rock
in things.

She, of course, is obviously
paying a lot of attention

to what the president is doing,
to what her husband is doing

and she's seen
as the keeper of the flame,

the one who keeps him honest,

the one who asks why on earth
are you doing it that way,

why would you do this?

Michelle Obama is even more
competitive than her husband.

She's very tough
on people who screw up.

She's very tough on herself.

You're watching your guy's
popularity decline

and you're watching moderates
and people who voted for Obama

become disappointed,
it's sort of wrenching.

She does not want to see him
dragged down

in everyday Washington business.

Michelle very much is
a "Why did you do this?

"Be a great man,
don't be a small figure,

"don't go for small things,
do big things".

She very much pushed him
to fulfil his biggest promises.

And that does bring tension
with someone like Rahm Emanuel,

someone like Robert Gibbs.

And an example of that
is the blow-up about Robert Gibbs

over something
that actually happened in France,

when this new book was published in
France about Carla Bruni-Sarkozy

saying that Michelle Obama
had told Carla Bruni

that living
in the White House was hell.

The White House had to react to this

because it would have been terrible
if the American public

thought that Michelle Obama
would have thought that.

She would have looked
ungrateful, aggrieved, etc.

Gibbs has spent a great part
of two days, I believe,

in chasing down
reports in a French newspaper.

Michelle Obama in particular
thought it was ridiculous,

and taking it seriously made it more
important that it actually was

infuriated the First Lady.

The White House tried
to beat back the story

and they were pretty successful.

The First Lady was not
satisfied with the response.

And Gibbs was incredulous.
He'd successfully quashed the story.

And he grew very agitated.

Robert knows how Washington works,

he knows what kinds of legs a story
like that would have and he blew up.

And he grew more and more
agitated and he started cursing

and he eventually said "F*** her"
about the First Lady

which is... it's not done.

I mean it's a terrible thing
to use an obscenity

in conjunction with
the First Lady of the United States

in a White House meeting.
And he storms out of the meeting.

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All right, are you going to
leave them in there?

No, I'm about to kick them out.

Okay.

Some days are good,
some days aren't so good.

You know, he was fighting
an uphill battle.

And there was the sense
within the administration

that idealism's great,
but you have to play by the rules

as the game is played,
at least to some degree.

But the whole story shows us what
a toxic situation it had become.

We see the president trying to do
things very differently.

And that includes kind of
reorganising his White House

to be more professional,
more strategic.

I think by 2011 he racks up
enough experiences

to realise that he
was wrong... that he was wrong.

Relationships in the White House had
grown so complicated at that point,

so tense, so much was going wrong

and everybody was blaming
each other for it

and this very unified group that had
worked together in the 2008 campaign

was now so factionalised

that some members
could barely talk to each other.

Oh my goodness,
they hated each other.

I mean this is inherent to the
West Wing almost by definition.

Like I'd interviewed everybody
from a very messy divorce, you know,

everybody had their grievance
against the others,

and everybody had their example of
how they'd been treated badly,

and how they had been ignored
or shovelled to the side.

A lot has been made of the tensions
inside the kind of West Wing

or the broader White House complex
and that's always been the case.

That is Washington.

That is what happens at this level
of power in the country.

There was definitely a sense of
dysfunction in the White House,

after that first year,
a lot of unhappiness.

His 2008 campaign was extremely
disciplined and clever

and that contrasts with some
of the disorganisation we saw

in the Obama White House

where some of the tight
relationships began to fall apart.

It took him a few months
to realise

that that is not the way
divided government was going to work

and he had to basically change his
approach if he wanted to succeed.

There was a tension
and in some ways

it was the result of choosing
a chief-of-staff like Rahm Emanuel.

People told me at the time that
they didn't realise

how much Rahm Emanuel
would try to undermine

what they had built in the campaign.

There was a schizophrenic quality
to the administration

in those first two years and
a lot of it was the result of that.

And he was a dominant figure,
so people...

many people were really
scared of him.

He is foul-mouthed, he is brash,
he will eat his opponents for lunch

and then comes back for seconds,

and part of this is also
self-created myth

because it helps him politically
to be thought of this way.

The most famous incident, of course,

is that he once sent a
political rival a dead fish

to make point
what he thought of this person.

Emanuel was a tempestuous
character

and there were
people in the White House

who didn't
want to bring issues to him

because they didn't
want to risk a blow-up.

He's very, very tough
on his staff,

you know,
a difficult person to deal with.

That was corrosive. Rahm didn't
understand the First Lady

and the
influence on the president.

There was a huge amount of distrust,
of internal competition.

LAUGHS Well, yeah, I think
obviously there was tension there

between
the First Lady and Rahm Emmanuel.

A lot has been made
of these tensions

between Michelle Obama and Rahm

which I just think
are kind of overblown, to be honest.

There are lots of disagreements
on lots of different things.

I don't know that he would have
been forced out

but it seemed for all concerned

it was the right time
for him to leave.

And that was something that
Michelle Obama

had really
pushed the president to do.

LAUGHS
As almost all of you have reported,

my chief-of-staff Rahm Emanuel
has informed me

that he will be
leaving his post today

to explore other opportunities.

Thank you.
It's a slightly different reception

than I got at my Bar Mitzvah,
but I appreciate it.

Thank you, Mr President...

In the audience sit most
of the president's chief advisers.

Seventeen of them will leave
in rapid succession.

Many of his top advisers
and much of his inner circle.

David Axelrod, Obama's right arm,
leaves for Chicago,

officially to prepare
the 2012 campaign.

Robert Gibbs follows him
and leaves the Press Office.

Robert Gates, secretary of defense,
also resigns.

Hillary Clinton announces she will
remain in the State Department

but that she will not serve a second
term if the president is re-elected.

A lot of people

that have been with the president
from the beginning have left.

The Wall Street Journal,

under the heading
'Exodus From The White House'

writes "All the first circle
around the president is shattered,

"broken, completely gone.

"Obama henceforth
will be a man alone."

Peter Orszag, director of
the Office of Management and Budget

had been the first to resign,

followed by General Jim Jones,
the US National Security Adviser.

Even Katie Johnson, Obama's personal
secretary, leaves as well.

As does Greg Craig, who failed to
close the Guantanamo camp.

Greg Craig was forced out
of the White House.

There was a real power struggle
between Craig and Emanuel.

You have to ask them as to
why they made their decision.

You know, betrayal, treachery,

they're big words
for some very small games.

I was prepared to be there to
help in the emergency situation

but beyond that
I had a family in Boston,

a wife who taught here and at that
point I'd return to Washington.

But it's also good to get fresh eyes
and ears because people are tired.

You do it for two years, so...
I'm a firm believer

of don't hang pictures on the wall,
don't get comfortable...

I just felt like
yeah, it was time to move on.

I went to the secretary and to
the White House in early April,

just after April 1,
and informed them of my decision

and in fact had a letter of
resignation present.

But they wanted to wait
and find a better time.

The president asks George Mitchell
to postpone his resignation.

"This is not a good moment" he tells
him, without specifying the reason.

In reality, just the night before,

Barack Obama had received
a highly classified message.

The CIA had found the only person
who could help Obama

in his run for a second term:
Osama bin Laden.

President Obama was briefed by
the Central Intelligence Agency

in March of 2011
with startling new information.

After ten years,
high value target number one,

the most wanted man in human
history, had finally been located.

We were told
that we had picked up people

who had been couriers for Bin Laden
several years before

and had followed them
to a house in Pakistan

where they seemed to be living.

That was something
we'd look at very closely.

That information was held

to an extraordinarily small
number of people.

At the White House it was
the president, the vice-president,

the national security adviser,
deputy national security adviser,

the counter-terrorism adviser
and myself,

we were the ones told about this.

The president then made
an extraordinary decision.

He decided we wouldn't tell
the government of Pakistan

and the Pakistani Intelligence
Service

that we thought
we knew where Bin Laden was.

Pakistan was our most important
partner in the war against Al-Qaeda.

And for a decade the US had given
the Pakistani army $12 billion

to fight Al-Qaeda.

Al-Qaeda's core, Osama Bin Laden
and the gang around him

were operating in Pakistan
with virtual impunity.

Senior levels of the Pakistani army
and the Intelligence Service

were complicit
in hiding Osama Bin Laden.

It challenges
all of our thinking about Pakistan

not just today but since 9/11.

It would in effect put the Pakistani
army as complicit

not just in hiding Bin Laden

but probably
in his terrorist crimes as well.

Somebody in the Pakistani army had
to know and General Musharaf knew.

The CIA came back and said

"You know, we really think there
might be something to this."

They came back and had done a
full-scale model of the compound

and brought it down
to the situation room.

They talked about the fact that this
compound was unusual in its security

and most important, they talked
about what seemed to be a family

living on the 3rd floor
that never left the compound,

and went through all the evidence

suggesting that Bin Laden
might actually be there.

And it was at that point
that the president ordered

that plans be established
to capture or kill Bin Laden.

The president went forward
with the decision

to send commandos into that hideout
and not tell Pakistan.

Almost all of the senior people
around the table

gave the president different advice

and had serious reservations
about the mission he ordered.

His own advisers were deeply split
on whether or not to do it.

And his vice-president said no
and his director of the CIA said

"This is the best shot
you're ever going to get."

So the night before the raid
on the compound to get Bin Laden,

there was a very, very large
annual dinner in Washington

called the White House
Correspondents' Dinner

and it's a tradition.

And as we were planning the mission,

there was actually
a very good chance

it would have to go forward
the very night of that dinner.

Having all our senior officials
at this dinner

when they needed to be
overseeing the operation,

and then if they didn't go,
people might start to get,

especially the reporters
in the room, a bit suspicious.

It would have been
impossible to tell

that the president
was preoccupied by anything.

You know the White House
Correspondents dinner

is this big set piece where everyone
is very dressed up, it's black tie

and it's a traditional time
where presidents are funny.

So they have a tremendous burden
to actually make people laugh.

I was actually in the backroom on
the night of the White House dinner,

the Correspondents' Dinner
before the Bin Laden raid,

and talked with the president
briefly.

He was in a great mood,
he was chipper and cheerful

and seemed as unbothered
as anybody could be.

And at the same time, was prepared
to order a SEAL team

to go in and kill Osama Bin Laden,

a very tough,
real world decision.

He was preparing his speech,

this is supposed to be a comic
speech to a room full of journalists

and senators
and cabinet members and so forth

and somebody wanted to use Bin Laden
as a joke in the text

and he told the writer

"No, take that out,
let's do something else instead,

"let's make fun of Qaddafi
or something."

And the president without
indicating anything said

"I just don't think it's that funny,
why don't we change it,

"instead of Osama,
let's change it to Hosni."

And everyone said "Okay, sure",
you know...

And we all discovered why later.

He was very cool, very good at
keeping secrets, I have to say.

And, you know,
in front of the collective talents

of Washington's best journalists
we were completely in the outs...

Didn't know a thing.

And almost no one
in the White House knew

that Obama
had authorised that mission.

Only his senior national security
staff, not his political aides,

not the press secretary.

Very, very, very few people...
Michelle Obama didn't know about it.

This is remarkable, to me,
that the US government was capable

of keeping such a big secret
as long as it did.

After he's given the go-ahead
for this operation,

he has to get up in front of this
ridiculous circus of a dinner

and give basically a comedy routine.

One of the prominent guests
at the dinner was Donald Trump

and he'd spent much of the previous
months attacking the president

for allegedly not being born
in the United States.

OBAMA: All right, everybody,
please have a seat.

APPLAUSE

It is wonderful to be here at the
White House Correspondents' Dinner.

What a week!

As some of you heard,

the state of Hawaii released

my official
long-form birth certificate.

Donald Trump is here tonight!

No one is happier, no one is prouder

to put this birth certificate matter
to rest than the Donald.

And that's because
he can finally get back

to focusing
on the issues that matter

like, did we fake the moon landing?

Hopefully
this puts all doubts to rest.

But just in case
there are any lingering questions,

tonight I'm prepared
to go a step further.

Tonight, for the first time, I'm
releasing my official birth video.

Now, I warn you,

no one has seen this footage
in 50 years, not even me.

But let's take a look.

APPLAUSE AND LAUGHTER

I want to make clear
to the Fox News table,

that was a joke.

That was not my real birth video.

That was a children's cartoon.

Call Disney if you don't believe me.

They have the original
long-form version.

And so one of the things
Obama does in this comedy routine

that he's forced to do
is just eviscerate Donald Trump

in front of everyone who matters
in Washington D.C.

Frankly the president killed it.
He was very, very funny,

and to the point where Donald Trump
was extremely uncomfortable

and unhappy
with the merciless mockery

that this whole two thousand people
filled room was laughing at him.

All of us at that dinner really
had to keep a straight face

knowing what was going to happen
the next day

and yet having to have a fun time

and laugh at a lot of jokes
the night before

when I think everyone was just
incredibly focused and nervous

about what was going to happen.

It was a remarkable performance,
it was funny, it was focused,

it moved 2000 people
to laugh uproariously,

and at the same time
some part of his brain was thinking

there's an incredibly dangerous
operation going on right now

that will either define
my presidency for good or bad.

Yes, I think it is fair to say
that when it comes to my presidency,

the honeymoon is over.

Others say that I'm arrogant.

But I've found a really great
self-help tool for this:

my poll numbers.

I've even let down my key
core constituency... movie stars.

Just the other day, Matt Damon -
I love Matt Damon, love the guy -

Matt Damon said he was disappointed
in my performance.

Well, Matt, I just saw
'The Adjustment Bureau' so...

right back at you, Buddy!

Let me close on a serious note.

We have incredible
young men and women

who are serving in uniform overseas

in the most extraordinary
of circumstances.

And we are reminded of
their courage and their valour.

God bless you and may God bless
the United States of America.

The bizarre shift of going from
the basements of the White House

and sitting around a table
with his national security staff

and, you know,
looking at satellite imagery

and puzzling over whether to launch
this strike

on what may or may not be
Bin Laden's compound,

he goes from that, you know,
to getting up and literally...

literally doing stand-up comedy
in front of Washington journalists,

you know, it gives you a sense of
the bizarreness of being president.

It was only afterwards that,
as people pieced it together,

we realised that,
in addition to the comic timing,

in addition to being funny,

in addition to enjoying
his own performance,

the president had already ordered

this exceptionally risky,
deadly operation

and the idea
that he could compartmentalise,

the idea
that he could put that aside

and concentrate on comedic timing

is frankly
the most chilling part of it.

There are many people
in the White House

who do not believe that he has blood
in his veins, you know,

that there is something so coldly,
calculatingly unemotional about him.

Some of us said afterwards, if this
political thing doesn't work out,

you've got a great career
on television ahead of you.

Barack Obama had checked everyone's
speeches for the evening,

but not the host's.

Truthfully, I'm humbled
to be sitting at a table

with President Obama,
a man I greatly admire.

It's such an honour to perform

for the leader of the world's most
powerful slash poorest country.

But I believe the president
would agree with me

that the mood has changed a bit
since the beginning of his term.

Not anymore, now everyone's leaving.
Axelrod, Gibbs, Rahm Emmanuel.

By this time next year
it will just be you and Joe Biden

trying to find toner
for the copy machine.

I'm also honoured to be performing
for those of you here tonight,

as well as the handful of people
watching at home on C-SPAN.

People think Bin Laden
is hiding in the Hindu Kush,

but did you know that every day
from 4-5

he hosts a show on C-SPAN.

TENSE, DRAMATIC MUSIC

And then at around 1 o'clock,
the senior people,

the cabinet secretaries came in,
secretary of state,

secretary of defense, vice-president
so forth joined us,

and a short while after that,

probably just before 2 o'clock,
the president came in to the room

and then the mission was launched.

There was no better
than a fifty-fifty chance

that Bin Laden was actually there.

We never positively identified him
before the raid.

We were there, probably,
oh you know, it was...

6 o'clock until we had
confirmation that the body was back

and we had further
positive identification of it.

I was not in the room, you know,
in that famous picture that Pete...

I was not next to him
with the camera like...

I was tired
and I was wearing my pyjamas

and my Blackberry goes off

and they are like "Hey, you know,
statement tonight, come on in"

and I was... "I'm not really wearing
pants, do I have to come in?"

and came right back, "You know, I
think you should put on some pants,

"why don't you come in?"

Good evening. Tonight, I can
report to the American people

and to the world that the United
States has conducted an operation

that killed Osama bin Laden,
the leader of Al-Qaeda,

and a terrorist who's responsible
for the murder of thousands

of innocent men, women and children.

And on nights like this one,
we can say to those families

who have lost loved ones
to Al-Qaeda's terror,

justice has been done.

On the TV screens

they started interrupting their
programming to let people know.

It's Sunday night,

the president is going to
speak to the country,

something must be going on.

And the program they interrupted
in the middle of the program on NBC

was Donald Trump's television show.

USA! USA! USA! CHANTING

Afterwards he said

"I knew it was an extraordinarily
difficult decision."

But was the approach
to tracking him down