When: Today, Monday, July 23rd

Where: CNBC’s “The Kudlow Report

Following is the unofficial transcript of a CNBC EXCLUSIVE interview with Republican presidential candidate Mitt Romney today, Monday, July 23rd. The full interview will air tonight on CNBC’s “The Kudlow Report” at 7PM ET.

All references must be sourced to CNBC.

LARRY KUDLOW, host: And we're pleased and honored to welcome back to THE KUDLOW REPORT former Massachusetts Governor Mitt Romney. Mr. Romney, as always, sir, thank you for coming on THE KUDLOW REPORT.

Former Governor MITT ROMNEY: Thanks, Larry, good to be with you again.

KUDLOW: Before we dig into some of the economic and money issues, let me just ask you after this horrendous tragic Aurora movie shooting, has the campaign now restarted in your judgment? Are we starting the campaign again?

Gov. ROMNEY: Yes. I think we are, but we're starting also with a level of thoughtfulness and seriousness that I think is appropriate in the aftermath of a tragedy of this nature. Obviously, the campaigns are under way. We're talking about our respective views and at the same time, our hearts are heavy as we think about the funerals that'll be held this week and the families that have been so tragically altered by virtue of the loss of life.

KUDLOW: You know, a lot of people are asking just on those very points you made that you and President Obama spoke so eloquently and beautifully about this tragedy right after it hit. People are saying, is it possible we could have a less negative back and forth for the duration of the campaign? Is such a thing possible or is that wishful thinking?

Gov. ROMNEY: Well, it really would be nice. I mean, I know that the president, when he called me and congratulated me on becoming the presumptive Republican nominee, said that America is--will benefit from a--an important and healthy debate. I haven't seen the healthy, important debate coming from the president's team. It's been almost all attack ads on all sorts of peripheral issues. I think the American people want to hear a discussion of the economy, how we'll get it going again, our philosophy related to foreign policy, how we'll get Iran to finally be dissuaded from their nuclear folly. These are the issues that we should be talking about. But I'm afraid what's primarily come from the president's campaign has been a series of attacks on me for my private sector work, by the way, for which I'm very proud. Recently, the Olympics, which I'm also very proud of. And of course, my leadership in Massachusetts and I think I was able to--by virtue of having a great team, able to achieve some wonderful things there as well.

KUDLOW: Governor, just one more on the Aurora tragedy. Over the weekend, as I'm sure you know, a lot of law enforcement officers came on various news shows and they talked about why they'd like to have some restrictions on the Internet sale of ammunition and so forth and restrictions on the general sale of these semi-automatic weapons. What's your thinking on those two points? Restrict the sales of both?

Gov. ROMNEY: Well, I'm a firm believer in the Second Amendment and I also believe that this is--with emotions so high right now, this is really not a time to be talking about the politics associated with what happened in Aurora. This is really a time, I think, for people to reach out to others in their community that need help or a comforting hand. Let's do that for now and then we can get on to policy down the road. I still believe that the Second Amendment is the right course to preserve and defend and don't believe that new laws are going to make a difference in this type of tragedy. There are--were, of course, very stringent laws which existed in Aurora, Colorado. Our challenge is not the laws, our challenge is people who, obviously, are distracted from reality and do unthinkable, unimaginable, inexplicable things.

KUDLOW: As the governor of Massachusetts, you did sign legislation restricting or banning assault weapons. Did that work in Massachusetts to your satisfaction?

Gov. ROMNEY: Well, actually the law that we signed in Massachusetts was a combination of efforts both on the part of those that were for additional gun rights and those that opposed gun rights, and they came together and made some changes that provided, I think, a better environment for both, and that's why both sides came to celebrate the signing of the bill. Where there are opportunities for people of reasonable minds to come together and find common ground, that's the kind of legislation I like. The idea of one party jamming through something over the objection of the other tends to divide the nation, not make us a more safe and prosperous place. So if there's common ground, why I'm always willing to have that kind of a conversation.

KUDLOW: All right. Thank you. I want to turn to the economy now. There's a very--everyone's talking about this poll today from The Hill newspaper, The Hill website, majority of voters blame the president for bad economic policy, two-thirds of the voters believe that bad job growth in the economy is because of bad policy. Over a third blame President Obama. He is the largest beneficiary, if you will, of that kind of blame. What has gone wrong? The economy is faltering again. What, in your view, specifically, has gone wrong?

Gov. ROMNEY: Well, I think the president made an error coming into office and deciding that the economy would take care of itself and he focused his energy on a series of liberal plans that he and his friends have been working on for years; take over the health care industry, a massive regulation of financial services in this country, trying to impose unions where employees don't want them, a new energy policy, slowing down the leasing of federal lands for the production of oil and gas. All of these things, not coincidentally, had the impact of slowing job creation and making them less likely for entrepreneurs to either open their doors or to expand hiring. And that's come home to roost at a time we should've focused on getting the economy going and only passed measures which encouraged job creation. Most of the measures the president pursued were--are ones that hurt job creation and as a result we're still suffering.

KUDLOW: You know, a lot of your supporters want you to be even more specific or just as specific regarding your own policies. In other words, Governor, what will you do to fix the problem, how will you convince voters that you're the right man for the job? People agree that the situation is bad. How can you make it better, sir?

Gov. ROMNEY: Well, I'll describe in some depth my economic plans as we continue through the campaign, but there are really five key points. One is to take extraordinary advantage of our energy resources. I have a very different view than the president on oil, coal, natural gas, renewables, nuclear. Energy, number one. Number two, trade. Opening up trade, particularly in Latin America. Number three, convincing the world that we are on track to have a balanced budget, that's critical. Number four, human capital. And by that I mean training programs for adults as well as better schools for kids. And number five, restore economic freedom by keeping our tax rates down, get regulators to see themselves as the allies of enterprise, not the enemies. These things, if we do these things, you'll see America's economy come roaring back. I don't know how bad it's going to get in the coming months, but I know that if we put in place those five policy directives, America's economy will see the kind of resurgence the American people expected some years ago.

KUDLOW: How should we be handling--how should Congress be handling the so-called fiscal cliff? Everybody says we're going to fall over the fiscal cliff of a huge tax hike and large spending reductions and that's going to lead to a recession. First of all, if the Bush tax cuts are not extended, do you believe, sir, we will have a recession?

Gov. ROMNEY: Well, I'm not going to predict, you know, the economic future, but I can tell you that you don't raise taxes on people in the middle of a downturn like this, particularly one that's gone on for three and a half years. Circumstances in this country suggest people are still having hard times, jobs are not plentiful. What the president should do is say look, we're going to extend for at least a year the--well, I'd like to see it permanent, but at least a year--the current tax environment. This sequestration related to defense spending, in particular, has to be put off. Look, the American people ought to choose the course for the future. And if they want to raise taxes on business creators and cause a further slowdown, well, they can vote for President Obama. But if they want to see this economy come roaring back with good--with good jobs, they ought to vote for me, in my view. And we ought to give, whichever president is going to be elected, at least six months or a year to get those policies in place. So let's extend where we are now as opposed to looking at a cliff in January that would cause, well, real distress for the economy and perhaps lead to the kind of outcome you suggest.

KUDLOW: If you were elected, OK, you want to extend the tax cuts, what about this--what about the spending cuts? A lot of people worried about that. A lot of people worried about the debt ceiling, a lot of people worried about a government shutdown. How would a President Romney handle that right at the beginning of your administration?

Gov. ROMNEY: Well, my plan is to, one, to get a bit of a runway to put in place policies that'll get the economy going. And so when I say extend the current tax setting, what I'm saying is don't raise taxes. Keep the taxes in place that we have. And then I would like to reform our tax code by bringing the rates down across the board for everybody. Also, limiting deductions and exemptions so that highest income people continue to pay the share that they're paying now. I'm not looking for tax breaks for high-income folks, but I am looking for more money being kept in small business so we can hire more people and pay better wages. This is the right course for America. And on the spending front, again, I don't think you go off and cut a trillion dollars out of our budget, particularly at a time like this. But you do eliminate some programs which over time will save more and more money because these programs grow at very large rates, so that we can show the world that we're on track to having a balanced budget within eight to 10 years.

KUDLOW: Why do you think President Obama, what did he mean, if you've got a business, you didn't build it, someone else made that happen? He claims it's being taken out of context. What do you think it means? Do you think this is Obama anti-business, anti-entrepreneur? Or do you think maybe he has been treated unfairly?

Gov. ROMNEY: Well, just read the whole speech. I found the speech even more disconcerting than just that particular line. The context is worse than the quote. The context, he says, you know, you think you've been successful because you're smart, but he says a lot of people are smart. You think you've been successful because you work hard, a lot of people work hard. This is an ideology which says hey, we're all the same here, we ought to take from all and give to one another and that achievement, individual initiative and risk-taking and success are not to be rewarded as they have in the past. It's a very strange and in some respects foreign to the American experience type of philosophy. We have always been a nation that has celebrated success of various kinds. The kid that gets the honor roll, the individual worker that gets a promotion, the person that gets a better job. And in fact, the person that builds a business. And by the way, if you have a business and you started it, you did build it. And you deserve credit for that. It was not built for you by government. And by the way, we pay for government. Government doesn't come free. The people who begin enterprises, the people who work in enterprises, they're the ones paying for government. So his whole philosophy is an upside-down philosophy that does not comport with the American experience. And if we want to get people working again--and that's my priority--if we want to get people working again, we have to celebrate success and achievement and not demonize it and denigrate the people who have worked hard, who are smart, who have made the kinds of investments to build a brighter future.

KUDLOW: But...

Gov. ROMNEY: Whether this is by succeeding in their job or starting a new enterprise.

KUDLOW: Do you think that--do you think that President Obama has demonized you and your experiences at Bain Capital? And do you--are you satisfied with your response, you know, to the timing when you left Bain Capital or investments in overseas operations and things of that nature? Do you think you have more work to do on your Bain Capital story?

Gov. ROMNEY: Look, I'm very proud of my experience at Bain Capital. I hope people understand that I was investing other people's money for them and was compensated if we were highly successful. And the returns came to groups that included charities and college endowments. Those are the people who received the greatest rewards from our successes. We were also able--I saw a report by the current partners of Bain Capital over the history of the firm, which I helped start, they made some 350 investments, 80 percent of which grew. That's the kind of record which I'm pretty proud of.

At the same time, I'm proud of the success we had at the Olympics and I'm proud of the success I had in Massachusetts. But I understand the president will do everything in his power to try and get people to talk about shiny objects which distract from the fact that he has been unsuccessful in getting this economy going and we're even having a conversation today where you bring up the recession word as you look forward. This is a--this is not the kind of hope and change the people of America expected. And I think the president is going to have to explain why he--why it was he's been unsuccessful. And if the people want to take another bet on the same coach who's had a lead—a losing season for the past 41 munch--41 months, that I think would be a very sad course to take.

KUDLOW: And last one, Governor, appreciate your time very much. You're going to Europe and you're going to Israel. Let me ask you your view of President Obama. Has he been tough enough in ousting Assad? After all, that would be a signal to Iran and to Hezbollah. Prime Minister Netanyahu talked about that yesterday. Is the United States being tough enough on Assad?

Gov. ROMNEY: Well, I think from the very beginning we misread the setting in Syria. The secretary of state said that Assad was a reformer. That's a phrase which will obviously go down in history as being poorly timed and entirely inaccurate. This is a person who is killing his own people and was at the time. America should've come out very aggressively from the very beginning and said Assad must go. At this stage, America is taking action, covert and overt, to try and encourage a change of leadership there. But the Middle East itself, with all of the violence which has occurred and which is occurring now in Syria, is a place of tumult and disarray and the world looks for American leadership and American strength. And it is time for us to have confidence that our cause is just, to have the kind of clarity of vision in our purpose and to have the kind of resolve behind our application of soft and hard power. And if those things are put in place, I think the world is a safer place and our freedom will be more secure.

KUDLOW: But is there any doubt in your mind that Assad has to go?

Gov. ROMNEY: Oh, there's no question but that Assad has to go. I think even the Russians from news reports I'm reading have recognized that he must go. We don't want to see a continuation of the same kind of brutality, which has characterized the last several months. But what follows Assad, we just don't know. But a person of this nature that's overseen the killing of his own people is obviously someone who's unfit to lead.

KUDLOW: All right. We'll leave it there. Thank you, Governor Mitt Romney. We appreciate your time very much, sir. Good luck on your trip and good luck on the campaign trail.

Gov. ROMNEY: Thank you, Larry. Good to be with you.

KUDLOW: All right. Thank you, Governor, we appreciate it very much. You got it down to five points.

Gov. ROMNEY: Thanks, Larry.

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