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Indicted Senator Fights For Survival; Hillary's V.P. Chances

Aired July 30, 2008 - 18:00   ET


WOLF BLITZER, CNN ANCHOR: And, to our viewers, you're in THE SITUATION ROOM.
Happening now, John McCain's somewhat risky new ad slamming Barack Obama's celebrity status with images of Paris Hilton and Britney Spears.

Plus, deadlocked over oil drilling, Republicans accusing Democrats in Congress of doing nothing about those high gas prices.

And an airport nightmare -- a conveyor system shuts down, baggage piles up, delaying flights and angering a lot of fliers -- all that coming up and the best political team on television.

I'm Wolf Blitzer. You're in THE SITUATION ROOM.

Senator Barack Obama is trying to stay on his economic message today, even as the McCain campaign portrays him as little more than a celebrity.

We want to welcome our viewers in the United States and around the world.

Just a short while ago, Senator Obama delivered his message of economic change to voters in the battleground state of Missouri.

Listen to this.


SEN. BARACK OBAMA (D-IL), PRESIDENTIAL CANDIDATE: If you are making $250,000 a year or less, you will not see any tax increase. Your payroll taxes won't go up. Your income taxes will not go up. You won't see your taxes on dividends or whatever else you have got. It will not go up, period.

If you're making less than $150,000, you will get a tax cut. So, don't let them fool you.


B. OBAMA: If you want some relief right now, you should be voting for Barack Obama for president of the United States.


(END VIDEO CLIP) BLITZER: Let's get to John McCain's new ad. It tries to use Barack Obama's star power against him.

Dana Bash is covering the McCain campaign for us.

All right, tell us about this new ad, which some say could be a gamble for him.

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT: Well, it is. At least some Republicans I talked to today do think it is a little bit risky, Wolf.

They're using -- the McCain campaign using campaign cash to highlight and even embrace Barack Obama's appeal, while trying to turn it into a negative trait. In fact, McCain adviser Steve Schmidt put it this way. He said -- quote -- "Do the American people want to elect the world's biggest celebrity or do they want to elect an American hero?"


BASH (voice-over): On the stump, rapid-fire attacks on Barack Obama's policies.

SEN. JOHN MCCAIN (R-AZ), PRESIDENTIAL CANDIDATE: He doesn't seem to understand the policies he offers would make our problems worse and not better.

BASH: Yet on the air...


NARRATOR: He's the biggest celebrity in the world.


BASH: ... John McCain is now comparing his rival to Britney Spears and Paris Hilton, mocking him as a vapid celebrity.


NARRATOR: But is he ready to lead?


BASH: With this new ad, McCain strategists are trying to channel their frustration with the attention Obama gets into a hit on his readiness and seriousness.

RICK DAVIS, MCCAIN CAMPAIGN MANGER: It's much more something you would expect from someone releasing a new movie than running for President.

BASH: McCain advisers say they are convinced Obama comes across as arrogant and/or trying to capitalize on that.

STEVE SCHMIDT, SR. MCCAIN ADVISER: This is a close election. We've seen much presumption from the Obama campaign.

BASH: But a new CNN/Opinion Research poll shows McCain advisers may be wrong on that. Only 37 percent say they view Obama as arrogant, pretty close to what they say about John McCain.

BRITNEY SPEARS, SINGER (singing): Oops! I did it again...

BASH: The Obama campaign responded to McCain's new ad by accusing him of -- quote -- "a steady stream of false negative attacks." Some might say, oops, he did it again.

This is the latest in a series of McCain attack ads against Obama...


NARRATOR: And now he made time to go to the gym, but canceled a visit with wounded troops.


BASH: ... and much sharper rhetoric.

MCCAIN: The bottom line is that Senator Obama's words, for all their eloquence and passion, don't mean all that much.

BASH: Even some of McCain's allies worry he's going too far.

CRAIG FULLER, REPUBLICAN STRATEGIST: I think people have sort of sat back and maybe got back on their heels a little bit and said, gee, that's not exactly what we want to see, even those of us who are in the Republican Party.


BASH: Now, this is the latest in a series of negative ads about Obama and increasingly biting rhetoric from McCain himself against his rival. And several Republican strategists I have talked to today, Wolf, say they are concerned about the negativity.

One told me he worries the McCain camp is allowing its -- quote -- "disdain for Obama" to overshadow some valid substantive political arguments against him -- Wolf.

BLITZER: Dana is covering the campaign for us. Thank you.

Senator Obama talked directly about the new McCain campaign ad earlier today in Missouri.


B. OBAMA: You know, I don't pay attention to John McCain's ads, although I do notice that he doesn't seem to have anything very positive to say about himself, does he? He seems to only be talking about me. You need to ask John McCain what he's for, not just what he's against. (END VIDEO CLIP)

BLITZER: The McCain ad and the Obama response up for discussion when the best political team joins us later this hour.

New ammunition today in the political fight over high gas prices. In our brand-new CNN/Opinion Research Corporation poll, 69 percent of those surveyed say they favor an increase in offshore oil drilling. But Americans are split over whether new drilling would reduce gas prices in the coming year. This is an issue that has Congress deadlocked right now.

CNN's Brianna Keilar is following the story -- Brianna.

BRIANNA KEILAR, CNN CORRESPONDENT: Wolf, you have heard Republicans blast Democrats for what they call a do-nothing Congress. Well, now Republicans are calling it a drill-nothing Congress.


KEILAR (voice-over): Two days before Congress goes on a month- long break and still nothing to address high gas prices. President Bush is ratcheting up pressure on Democrats to open up protected areas to offshore oil drilling.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: All the Democratic leaders have to do is to allow a vote. They should not leave Washington without doing so.

KEILAR: After Senate negotiations to vote on drilling fell apart, Republicans blamed Democrats.

SEN. MITCH MCCONNELL (R-KY), MINORITY LEADER: We're going to have a hard time legislating on the number one issue in the country.

KEILAR: But Democratic leaders say Republicans are just pushing more of what they call President Bush's failed energy policies.

SEN. CHARLES SCHUMER (D), NEW YORK: Americans know the real answer here is to fast-track alternatives, not to stay mired in the past with big oil and drill, drill, drill.

KEILAR: Republicans are encouraged by a growing number of Americans who support oil drilling in protected offshore waters. Even some Democrats in the House are frustrated by Speaker Nancy Pelosi's refusal to allow a vote on offshore drilling.

REP. NEIL ABERCROMBIE (D), HAWAII: Her views are not necessarily those of the rest of the Congress or that of the nation as a whole.

KEILAR: Democrat Neil Abercrombie is pushing bipartisan legislation that would allow drilling in the new offshore areas. And he's urging voters to make their frustrations heard in Washington.

ABERCROMBIE: We have heard vote after vote after vote on the floor of the House and attempt after attempt after attempt made in the Senate to pass energy bills. Has anything passed? Nothing has passed.


KEILAR: Senate Democratic Leader Harry Reid says he is trying to overcome this standoff. He's calling on Republican leader Mitch McConnell to get together with a bipartisan group of senators for an energy summit that would take place next month in Las Vegas -- Wolf.

BLITZER: Brianna, thanks for that update. Brianna Keilar is watching the story on the Hill.

The FDA has come out with some new information on that salmonella outbreak that has sickened well over 1,000 people in this country.

Carol Costello is working that story for us.

I take it they finally believe they have a cause?

CAROL COSTELLO, CNN CORRESPONDENT: Well, Wolf, they say they have a smoking gun. They do, really. Or should I say smoking guns? The FDA's food safety chief says the smoking guns are irrigation water and a serrano pepper at a farm in Nuevo Leon, Mexico.

Dr. David Acheson and officials from the Centers for Disease Control were grilled at a congressional hearing and explained why initially they thought tomatoes were to blame and now think serrano and jalapeno peppers grown in Mexico are to blame.


DR. DAVID ACHESON, ASSISTANT COMMISSIONER FOR FOOD PROTECTION, FOOD AND DRUG ADMINISTRATION: To start with, there were many sporadic cases. They weren't clusters, so there was no clear focus for trace- back. Then what we were learning is that in fact it was not the major chains and the major industries. It was small Mexican-style restaurants very often.


COSTELLO: As you well know, 1,300 people have been sickened by tainted food. So, let's review. Do not eat serrano or jalapeno peppers grown in Mexico. As for tomatoes, they are not completely out of the picture, because they may have been tainted by irrigation water or those peppers from Mexico. So, eat tomatoes at your own risk -- Wolf.

BLITZER: I will be eating them because I love tomatoes.

COSTELLO: Me, too.

BLITZER: Carol, thank you.

Let's go back to Jack. He's got "The Cafferty File" -- Jack.

JACK CAFFERTY, CNN ANCHOR: First, the government said it was the tomatoes, right? Then they said, no, it's not.... (CROSSTALK)

BLITZER: Killed the tomato industry, too.

CAFFERTY: Killed the tomato industry. And then, when that industry was dead, they killed the jalapeno pepper industry, saying it's jalapeno peppers. Now they say it's the water in Mexico. The water in Mexico causes everything. I mean, it's -- you don't drink the water in Mexico.

But the government has been trying to find out where the salmonella is coming from that makes people sick for months now. And I'm not sure they have it down yet.

And I just lost the teleprompter here in New York.

The 2008 presidential campaign, a telethon without a disease, in fact, the longest-running campaign in American history. First, the public was subjected to a 16-month-long primary season, including months of the Clinton/Obama drama. And that was just the opening act. It's only July. Now we're bombarded with nonstop coverage of Obama/McCain, that throwdown, every day, back and forth, tit for tat between those two campaigns.

These candidates have been at it for quite some time, too. Consider, Barack Obama has been running for president for almost two years, since saying in October of 2006 he was considering running for president. John McCain has been at it probably even longer, dating all the way back to his embrace of President Bush during the 2004 campaign.

And it's only going to get worse. Next up, the vice presidential picks. The world is on tenterhooks waiting for that. That will be followed by the conventions. They're mildly interesting sometimes. And then, after Labor Day, get ready for the really heated campaigning, the debates, the town hall meetings, the staged events for the TV cameras. It will make your teeth hurt, not to mention all the campaigns for the congressional and Senate seats.

In late September, some voters can start casting absentee ballots. Don't think both candidates won't have their eyes on those people, which experts say could actually total as many as a third of all the votes cast. Even more intensive news conference won't be the half of it. Brace for the upcoming onslaught of television ads, direct mailings, phone calls to your house asking for your money, for your votes. It will be positively suffocating.

The next 100 days or so will be a political version of waterboarding.

Here's the question: Are you politicked out yet?

Go to Post a comment on my blog.

I'm actually not. I figured I would have worn out on this thing by now, but I'm still in the game. BLITZER: Me, too.


BLITZER: You know, those hard-core political news junkies, we love it, Jack, despite -- despite those points you legitimately raise.

CAFFERTY: Yes. But, if they did this for 20 years, you love this.

BLITZER: I do love it.

CAFFERTY: You could eat a steady diet of this.

BLITZER: I love politics.

CAFFERTY: I know you do.

BLITZER: All right, Jack, thanks.

A Democratic dream may remain just that, a dream. Hillary Clinton's chances of becoming Barack Obama's vice president, those chances appear to be dimming.

Suzanne Malveaux working the story.

An indicted Republican senator fights for political survival. But his indictment is leaving some Republicans worried. We will explain.

And hundreds, maybe more than 1,000, of mixed-up bags, they're causing a lot of headaches for their owners. There's luggage seemingly as far as the eye can see right now at one terminal at New York's JFK Airport. Could this be coming to an airport closer to you?

Stay with us. You're in THE SITUATION ROOM.


BLITZER: Many Hillary Clinton supporters still say she should be the leading contender to be Senator Barack Obama's running mate. But more than a month after the Senators Obama and Clinton put on their big show of unity consist, the prospect of a joint ticket seems iffy at best.

Let's go to Suzanne Malveaux. She's working the story for us.

What are you hearing about Senator Clinton's chances of being on that ticket?

SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Well, sources close to Clinton tell me that Senator Clinton has been asked by the Obama campaign to hit the campaign trail for Senator Obama soon. And she's going to do so in the next couple of weeks. She's going to be focusing on Nevada, Ohio, as well as Florida. And she's been told to expect to travel a lot this fall. Those close to her say that she is completely comfortable with that. And they also say that she is not angry with Obama, despite the fact and she believes that it looks like she has very little chance of becoming his running mate.


MALVEAUX (voice-over): So what happened to Hillary?

BLITZER: They see potentially a dream ticket, a dream ticket...

MALVEAUX: In Barack Obama's search for a running mate, talk of the Obama-Clinton dream team has all but faded.

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: From what we can gather, she's not really on the short list.

SEN. HILLARY RODHAM CLINTON (D), NEW YORK: A lot of people are asking, What does Hillary want? What does she want?

MALVEAUX: Clinton's 18 million voters were once painted as the 18 millions reasons Obama would want to pick for Clinton for the number two spot. Clinton made it clear it was a job she'd take if asked. Her closest friends did her bidding.

BOB JOHNSON, BUSINESSMAN, CLINTON FRIEND: She would certainly, as she said to some of the New York delegation, entertain the idea if it's offered.

MALVEAUX: Mindful not to disrespect Clinton, or alienate her supporters, Obama insists she hasn't been ruled out.

B. OBAMA: Hillary Clinton would be on anybody's short list.

MALVEAUX: But as the short list gets shorter, the political calculations seem a little more clear.

BORGER: Hillary Clinton would be in the ticket if Barack Obama's campaign felt that they were in some trouble with the voters that she brings, the older women, those voters in rural America, battleground states. They don't think they're in trouble there, so they probably don't think they need her.

MALVEAUX: Perhaps not as a running mate, but certainly as an advocate in the battleground states, like Pennsylvania and Ohio, where Clinton triumphed.

She is now fully engaged in talks with the Obama team to hit the trail in the next several weeks. At the same time, the buzz is intensifying over who could be a running mate capable of bringing in Clinton voters.

PRESTON: The person who is best positioned to attract these older over 55 women who supported Hillary Clinton is Evan Bayh.

(END VIDEOTAPE) MALVEAUX: And Senator Bayh was also originally a big Clinton supporter and was by her side during much of the primary season -- Wolf.

BLITZER: Thanks very much, Suzanne, working the story.

Let's take a closer look now at some of the timing of other recent vice presidential picks. This is interesting. Back in 1988, George Herbert Walker Bush tapped Dan Quayle in mid-August, only one day after the GOP convention had actually begun. That's the latest announcement of a running mate in the past 20 years.

The earliest V.P. announcement in recent campaign history came back in 2004. John Kerry named John Edwards in early July. That was 20 days before the Democratic Convention started. Most V.P. recent choices have been revealed within a week or so before the convention. George W. Bush took that route back in 2000, tapping Dick Cheney in late July, six days before the Republican Convention. Al Gore named Joe Lieberman in early August, also six days before their party's convention.

The indicted Republican Senator Ted Stevens will make his first court appearance tomorrow in federal court right here Washington, that according to court records. Today, it appeared to be business as usual for Stevens in the U.S. Senate. He's accused of lying about accepting gifts from a contractor in his home state of Alaska. And now some are wondering about the political fallout.

Let's go to Brian Todd. He's working the story for us.

There's a lot of concern among Republicans, Brian, this could hurt the problem.

BRIAN TODD, CNN CORRESPONDENT: They're up against it, Wolf. In the Senate alone, the GOP has to defend 23 seats this fall. The Democrats only have to defend 12. It's a stretch, but this election, the Democrats could get up to that magic number in the Senate, 60 seats, which would allow them to break any Republican filibusters.

Boiled down, it means Ted Stevens' problems couldn't come at a worse time for his party.


TODD (voice-over): Aboard the Senate subway, Ted Stevens gets a warm welcome from fellow Republican Elizabeth Dole. They may not be seeing each other in these old familiar places this time next year. Even before his indictment on corruption charges, Stevens faced a tough reelection battle. And even the GOP leader in the House can't put a spin on his party's fortunes.

REP. JOHN BOEHNER (R-OH), HOUSE MINORITY LEADER: It's a tough environment for Republicans. There's no question about it.

TODD: Analysts say Republicans in Congress haven't been this vulnerable in decades. STUART ROTHENBERG, EDITOR AND PUBLISHER, "THE ROTHENBERG POLITICAL REPORT": Two years ago was a horrible election for the Republicans in a terrible environment. The environment is now worse for the Republicans than two years ago. And that means the election results could be as bad, or, in some cases, even worse.

TODD: Stuart Rothenberg projects, in the Senate, the Republicans will have a tough time holding on to seats in eight states, possibly more, the Democrats just one. Analysts say that's partly because five Republican senators are retiring after this session, but they also say the Republican brand is tarnished.

Stevens' legal problems follow sex scandals involving Republican Senators Larry Craig and David Vitter and the Jack Abramoff lobbying scandal that landed GOP staffers and one congressman in jail.


TODD: But one GOP strategist we spoke to says the party is already being re-branded by none other than John McCain. She believes the Republicans can play up his image as a reformer and successfully portray these scandals as relics of the past -- Wolf.

BLITZER: Brian Todd with the story for us.

Right now, some travelers are forced to wear the same clothes. That's because their bags are mixed into a huge mixup over at New York's JFK Airport. You are going to want to see what's going on.

And the House speaker, Nancy Pelosi, is being embraced by a presidential candidate. It would be John McCain. And that could frustrate some House Republicans, some conservatives who want to go negative against her.

And there is a new drug that has experts pondering the potential for a cure for Alzheimer's disease.

Stay with us. You're in THE SITUATION ROOM.



BLITZER: The McCain campaign is trying to turn Barack Obama's celebrity status from an asset to a liability. The best political team on television standing by to weigh in.

A Hillary Clinton ally called him Judas for backing Barack Obama. Now Governor Bill Richardson is going to surprising new lengths to heal the rift.

And Judge Judy's verdict on the L.A. earthquake -- tremors and the shock all caught on tape.

Stay with us. You're in THE SITUATION ROOM.


BLITZER: To our viewers, you're in THE SITUATION ROOM.

Happening now, if you're flying American Airlines out of New York's Kennedy Airport today, chances are your bags aren't going to be making it. And that baggage room backup is leading to backups on the runway. Stand by for an update.

Also, he was praised for his so-called star power. Now Barack Obama is accused of acting too presidential. Is that a bad thing?

And he was a friend of the Clintons who jumped on the Barack Obama bandwagon. Now Bill Richardson will host fund-raisers for Hillary Clinton. Could that help unite the party?

All of this, plus the best political team on television.

I'm Wolf Blitzer. You're in THE SITUATION ROOM.

But, right now, a massive baggage pileup at New York's JFK Airport, and it's leading to huge flight delays. Many departing passengers will have to leave their bags behind, hoping to hook up with them at some point down the road.

Let's go to JFK. Mary Snow is working the story for us.

Mary, what's behind this baggage breakdown?

MARY SNOW, CNN CORRESPONDENT: Well, Wolf, American Airlines says it's a computer glitch. It's crippled the baggage system here. The problem began at 4:00 a.m. this morning. It is still not completely fixed.

Tonight, American Airlines says 13 flights flying out of JFK have been canceled to try and alleviate the problem. And, needless to say, passengers are frustrated, if not furious.


SNOW (voice-over): It quickly became a big mess. Bags bound for American Airlines flights departing from New York's JFK Airport piled up after the airline says a software glitch shut down the conveyor belt system. Passengers could leave their bags and have American deliver them later or take a later flight.

UNIDENTIFIED FEMALE: What I'm asking you is, may I have another flight at a later time when the belt is fixed, so that I can travel with my baggage?

SNOW: Passenger Norman Robinson says he arrived at the airport around 6:30 in the morning and he recorded this scene on his cell phone camera.

NORMAN ROBINSON, PASSENGER: This is crazy. What makes it even worse is there is another side of the building. It's about five times worse than this. SNOW: Robinson waited for a later flight to Bermuda because he didn't trust the airline.


SNOW: Airline workers manually sorted through bags, but it didn't prevent confusion and delays.

Pouring salt into the wound, airlines have been raising fees. American is one of five airlines charging $15 for the first checked bag. Separately, Delta just announced its upped its second checked bag fee from $25 to $50.

RICK SEANEY, CEO, FARECOMPARE.COM: Passengers in general are just beaten down right now. They've been hit with higher prices on tickets. They've been hit with nickel and dime fees across the board. I think they could live with it more if the product of getting a person off on time and arriving on time with their bags was a better product on the airlines.

SNOW: But Chuck Feinberg (ph), who's heading to France for vacation, says there's little passengers can do. He arrived at JFK 10 hours after the problem started and says he still couldn't get straight answers.

CHUCK FEINBERG, PASSENGER: It's very frustrating. And it's unacceptable to me. But there's nothing I can do about it. I can't fight them. They have you hung up to dry and c'est la vie.


SNOW: American Airlines declined a request for an on camera interview. It did say that it is waiving its fees for the passengers who are affected here at JFK, saying there are still some delays of up to an hour on flights. Saying -- it's telling passengers to come here a few hours before their flight. But they're still not promising that their bags will get with them.

And, Wolf, this mess is going to spillover into tomorrow, because there's still about 750 bags, according to American Airlines, that still need to be sorted through that are at the airport -- Wolf.

BLITZER: Mary is at JFK Airport.

All right, Mary, thanks for that disturbing story.

Coming up, he's been showered with attention because of his so- called star power, but is Senator Barack Obama's star now shining too brightly?

Let's discuss this and more. Joining us, our senior political analyst, Gloria Borger; our own Jack Cafferty; and Steve Hayes of "The Weekly Standard".

They're all part of the best political team on television. Jack, we heard earlier the McCain ad going after Senator Barack Obama, comparing him to Britney Spears and Paris Hilton for celebrity status.

Now the Obama campaign has come up with their counter ad.

We'll play a little clip of it.


UNIDENTIFIED FEMALE: He's practicing the politics of the past -- John McCain. His attacks on Barack Obama, not true, false, baloney, the low road, baseless. John McCain -- same old politics, the same failed policies.

Barack Obama supports a $1,000 middle tax class cut, an energy plan that takes on oil companies, develops alternative fuels and breaks the grip of foreign oil. That's change we can believe in.


BLITZER: All right. So there you have it. You've got two ads. It's getting nasty -- not very nasty, a little nasty. But it's -- there is the potential for it to get really nasty.

CAFFERTY: Well, the McCain ad was better because it was more entertaining, I think.


CAFFERTY: I'd be willing to make you a bet. If you added up all of the people who have attended every political event John McCain has held since the campaign started, the number would not get to 200,000, which is the number of people that watched Barack Obama speak in Berlin.

That ad that he put out is nothing more than the same jealousy he displayed last week when Obama was on this tour. McCain went to Canada, Mexico and Colombia. And the only thing I remember about any of those three trips or visits was some hostages got released one day while he was in Colombia. It had nothing to do with McCain being there.

So, you know, Obama is getting a lot of attention and McCain doesn't like it. It's jealousy.

BLITZER: Is it jealousy, Steve?

STEPHEN HAYES, SENIOR WRITER AT "THE WEEKLY STANDARD": Well, sure. There's probably a little amount of jealousy there.

I think what McCain needs to do is to break through. He needs to be part of the story. And there has been a story for the past week- and-a-half, 10 days, about Barack Obama. And it has been a lot about Barack Obama's celebrity. I mean it's been more than that, to be sure. But the McCain campaign, I think, is right to point this out. They're right to try to get in the story. And I don't think that this is the kind of ad that's going to send voters, you know, scurrying away from John McCain by any means. I think it's pretty effective.

BLITZER: How does he break through, though, in terms of what Steve was just talking about, Gloria?

BORGER: Well, he is trying to break through. I think he's doing it in the wrong way, though. I think, yes, this ad will get him some attention. They're very happy about the attention they're getting. But it's kind of a belittling ad. It's trying to make you think that Barack Obama is a celebrity and nothing else.

And I think John McCain has another story to tell. He can talk about his experience and his wisdom. He doesn't have to belittle his opponent. He really needs to just talk about the issues.

BLITZER: Because he said he -- that's what he wanted to do going into this race. He said he wanted to discuss the major differences on the substantive national security...

BORGER: Right.

BLITZER: well as domestic, economic issues, and not make it sort of a personal attack, if you will.

CAFFERTY: I remember that.

BORGER: Well, he's trying to get some attention.


CAFFERTY: Yes, but at the beginning of the campaign he said -- this is the guy who rides around on something called the Straight Talk Express -- this will not be that kind of a campaign. We're going to keep it on the high road. We're going to talk about the issues. And he's come out with one snarky, low rent piece of television after another.

Now, that being said, McCain's running on short money.

So how do you compensate?

You put out these goofy commercials with Britney Spears and Paris Hilton in them and then people like us run them over and over and over again for free.

HAYES: Yes, but Wolf, I mean, look, we've all seen really negative political ads. This is not one of them. I mean this is Barack...

CAFFERTY: No, it...

HAYES: This is John McCain saying, look, Barack Obama is a celebrity. Nobody disputes that. And then he hits him basically on two issues -- drilling and taxes, both of which are issues that McCain wants to have an issues contrast with Barack Obama on.

I just don't think this is that negative of an ad. And if -- I think for the people who do think that, wait for a couple of months.

BLITZER: Good point.

CAFFERTY: Wait is right.

BORGER: But, you know, McCain is not your typical Republican. And that's what Independent voters like about him. So what he has to do is talk about how he's not your typical Republican. And I don't think that these ads really play into that...

BLITZER: Well, just wait...

BORGER: ...particularly, or to Independent voters.

BLITZER: And we're going to have something that points out that he's not a typical Republican.


BLITZER: I just want both of you to stand by for that, because I think a lot of people are going to be surprised what he's staying about Nancy Pelosi.


BLITZER: Also coming up, he was called a Judas. You remember James Carville calling him a Judas for jumping on the Barack Obama bandwagon.

Now, can Governor Bill Richardson make it up to his old friends by hosting fundraisers for Hillary Clinton?

The best political team on television will assess.

And what the presidential candidates are doing to get a foot up on the competition.

CNN's Jeanne Moos finds it Moost Unusual.

Stay with us.


BLITZER: All right, here's the question -- what's John McCain doing reaching out to the House speaker, Nancy Pelosi, even as her own -- as his own party goes negative towards Nancy Pelosi?

Let's discuss with the best political team on television.

Steve, I'll read to you what he told the "San Francisco Chronicle" about the speaker: "I respect Speaker Pelosi. I think she's one of the great American success stories." He called her an effective leader, an inspiration to millions of Americans, adding, "I promise you that I respect her. I will sit down with her when I'm president and will say let's work together."


BLITZER: It's not exactly what the conservative base of the Republican Party right now wants to hear John McCain saying about Nancy Pelosi.


If your question is what is he doing, the answer is I have no idea what he's doing.



HAYES: It's -- you know, this is one of the things that I think people like about John McCain and people don't like about John McCain, including people in his own campaign. You know, this is John McCain. He always seems to want to go out of his way -- especially when you ask him about a particular individual -- to say something nice.

So when I interviewed him about Dick Cheney for a book that I wrote, he had nice things to say about Cheney, even though they sort of were at loggerheads for much of the Bush administration.

He does the same thing about Hillary Clinton. Every time she's brought up in one of these town halls that I've been to with him across the country -- you know, a voter will criticize her or take a shot at her and he will go out of his way...

BORGER: Well...

HAYES: ...sometimes giving a short speech, to heap praise on Hillary Clinton.

BORGER: But he actually likes...

HAYES: It is not going to help with conservatives.

BORGER: He actually likes Hillary Clinton. I'm not quite sure how he feels about Nancy Pelosi.

But could this be about reaching to Independent voters?

Could this be about reaching out to those older women that loved Hillary Clinton so much and that might like Nancy Pelosi?

I mean it drives his base nuts, but I do think he has some good political reasons for doing this, because if he becomes president, he's going to have to work with a Democratic Congress.

CAFFERTY: Yes, you know...

BORGER: He is.

CAFFERTY: He just looks confused. I mean come on.

BORGER: Well...

CAFFERTY: Nancy Pelosi presides over a Congress that has a 9 percent approval rating.

HAYES: Exactly.

CAFFERTY: Barack Obama has to talk to her because they're both -- you know, they're both Democrats. And he has to be seen with her. John McCain has no excuse.

The first thing the Democrats ought to do if they win this election in the fall is when the new Congress convenes, get rid of her and get a speaker that the rest of the country can stand. This woman is awful.

BLITZER: Gloria, you remember what James Carville called the governor of New Mexico, Bill Richardson, Judas...

BORGER: Oh, yes.

BLITZER: ...for backing Barack Obama, even though James Carville said that he had commitments from all sorts of people...


BLITZER: ...that he was going to support Hillary Clinton.

But now Bill Richardson is about to host some fundraisers for Senator Clinton. She needs the money to try to pay off that huge debt she owes.

BORGER: What is it that Rozanne Rozanna Dana used to say, never mind?

Never mind. They're friends now. I think it works -- it works for everybody. First of all, Hillary Clinton gets to -- some help retiring her debt. Bill Richardson gets out of the dog house. The Clintons start talking to him again. And Barack Obama gets Hillary Clinton in New Mexico for him, which is going to be a key battleground state.

So guess what, it works for everyone.

BLITZER: Is everybody happy now, Jack?

CAFFERTY: Well, I don't know.

What happened to his beard?

Steve's got a nice beard there. I thought it looked pretty good on Bill Richardson.

BLITZER: I don't know. That might...

CAFFERTY: And now it looks like he's... BLITZER: That might be an old picture of him. We've got to check to see if he's got the beard.

CAFFERTY: Oh, is that what it was?

BLITZER: Do you know, Steve, if he still has the beard?

HAYES: I don't know if he still has the beard. I have no idea.

BORGER: Maybe he wants to be vice president.

HAYES: It worked for him. I'm with Jack. It worked for him.

CAFFERTY: Yes. Absolutely. He looked good with the beard. Why he's sucking up to the Clintons now, I don't know. But he is.

BORGER: Well, he's doing it because Obama wants him to do it, because Obama needs Hillary Clinton's help. And Bill Richardson will do whatever he can for Barack Obama.



BLITZER: Whatever happened to all the talk, Gloria, of Bill Richardson on the short list?

BORGER: Not so much anymore. I think that he's important to Obama with Hispanic voters. But I think that when it came time to decide, I don't think that they felt that Richardson brought them as much as some of these other folks that they're thinking about.

CAFFERTY: Plus, didn't the Hispanics -- I saw a poll the other day that Hispanics are suddenly in love with Obama.

BORGER: Right.

BLITZER: That's right.

HAYES: Yes, Wolf, I'd -- let me just point out another reason why I think Bill Richardson is doing this. Politicians have so few opportunities to show sort generosity of spirit and magnanimity. And this is one time when Richardson can do that and look good. And he's an ambitious guy. I mean his political career is not over. I think he's sort of on his way up. And this is something that will likely help him down the road.

CAFFERTY: Good point.

BORGER: And I don't think Bill Richardson helped himself in all those debates during the primaries, Wolf.

BLITZER: All right...

BORGER: I think he grew smaller and not larger.

BLITZER: All right, guys, stand by, because we have some more to discuss with Jack with "The Cafferty File."

The other two of you can go home.

BORGER: Oh, thank you.

BLITZER: Enjoy the rest of your night.

Jack's got to work a little bit longer.


BLITZER: When he speaks, people listen and they pay a lot for the privilege. You won't believe how much Bill Clinton is making on the lecture circuit. Maybe you will.

Plus, video you've got to see. Even Judge Judy got a jolt when that California earthquake hit.

And you'd better save some of that income tax rebate. Retailers say big increases are coming when the Christmas season begins to roll around.

Stay with us. You're in THE SITUATION ROOM.


BLITZER: Let's check in with Lou to see what's coming up right at the top of the hour.

What are you working on -- Lou?


The Food and Drug Administration finally admitting in public what we've been reporting on our broadcast for a month -- that Mexico is to blame for the salmonella outbreak in this country. We'll have complete coverage for you tonight.

And the Bush administration wants to make it a lot easier for foreigners to build and to buy American highways, American bridges and tunnels. We'll have that story.

And new concerns tonight about the integrity of our voting system, the future of our democracy. Some lawmakers are demanding that e-voting machines with no paper trails be established everywhere.

Just what in the world are they thinking?

We'll have that special report.

And one of the most outspoken pro-amnesty Congressmen, Luis Gutierrez, joins me, playing politics with the enforcement of our laws. He will be among our guests here.

And tonight we'll have all of the day's news. Join us for that at 7:00 Eastern right here on CNN and much more with an Independent perspective -- Wolf, back to you.

BLITZER: See you in a few moments, Lou. Thank you.

DOBBS: You got it.

BLITZER: Let's go back to Carol.

She's monitoring some other important stories incoming into THE SITUATION ROOM right now.

What do you have -- Carol?

COSTELLO: Well, Wolf, the cameras were rolling in Hollywood as yesterday's earthquake hit the Los Angeles area. Even Judge Judy was rattled when the 5.4 magnitude quake struck.


JUDGE JUDITH SHEINDLIN, TV SHOW HOST: OK. Well, he got your credit card -- your bank card somehow and he got your PIN number somehow.


COSTELLO: Everyone got out safely, but, boy, did they run out those doors, Wolf. Despite those scary moments, the quake, as I said, caused no injuries or major destruction. There was some damage, though, in the City of Pomona, very near the epicenter. A brick wall buckled, windows shattered and some buildings sustained superficial cracks.

A controversial way to enforce the dress code at a Texas high school. Students who break the rules will be forced to wear a prison- like jumpsuit. Some parents say the jumpsuits will make students feel like -- well, prisoners. But the school says it's a way of covering up dress code violations without having to suspend the students. However, some students say they intend to break the dress code just so they can wear the jumpsuit.

Have you ever thought about Christmas shopping yet?

Probably not, but it might be a good idea. Retailers say we could be store in for price increases of up to 50 percent this year on everything from food and ornaments to toys and designer handbags. Companies say higher energy and labor costs, plus the weaker dollar are forcing them to pass on more of the burden to consumers.

So shop now -- Wolf.

BLITZER: Yes, let's run out right now before the prices go up.

That's what you're saying, right, Carol?

COSTELLO: Right. And you'll have a lot less stress, too, come Christmastime.

BLITZER: Not going to happen.

Thanks, Carol, very much.

Let's go to Jack Cafferty. He's already done all of his Christmas shopping for the year -- right, Jack?

CAFFERTY: I think we've just set a record for the earliest that we've ever mentioned Christmas shopping.

BLITZER: The prices are going up.

CAFFERTY: What is it -- it's July 30th, right?

BLITZER: Yes. That's right.

CAFFERTY: And we're talking about Christmas shopping?

BLITZER: It's never too early.

CAFFERTY: It's outrageous.

The question -- in light of this interminable -- and it is -- campaign season, we asked: Are you politicked out yet?

James writes: "I can't take it anymore. Don't get me wrong -- I can't wait for election day. But I can barely stand to look at the polls and the Web sites. I've stopped watching election coverage altogether. I'm extremely excited about this election. Just wake me up November 6th. I've had enough."

Billy in Las Vegas says: "I wish we had the British system. Campaigning only lasts five to eight weeks ahead of an election. There are laws that ban most TV and radio ads. As a matter of fact, I wish we had their parliamentary system, because if you end up with a complete fool in power, it's easier to get rid of them. I doubt a Prime Minister Bush government would have survived 30 days after 9/11 and definitely would have been voted out after Katrina."

Brian in Idaho writes: "No way. I'm addicted, just like you are, Jack. You sound like a grouchy old guy most of the time."

Hey, it's no act.

"But then again, you've picked up a job where you're paid to complain three times a day on television about politics. All I know is that you and I might have to become drinking buddies after the election. We're going to be dealing with some serious political withdrawal."

Steve in Florida writes: "I'll be glad when the whole thing moves to The History Channel."

Linda in Atlanta: "I'm not politicked out. I'm in it for the long haul. To me, the stakes have never been higher. It's incumbent upon every American who wants a better future to fully engage, stay engaged until the last vote is counted." Saroop writes: "Aside from sports, there's nothing else on TV. Politics has to keep me going until the new season of "Lost" begins.

And Robert in New York says: "Hey, Jack, even if we were, would you stop shoving it down our collective throats?


If you don't see your e-mail here, you can go to my blog,, and look for yours among hundreds of others.

Judged by the numbers of e-mails I get every day, this story has got a lot of legs and a long way to run. People are in it. They're into it.

BLITZER: I totally agree, Jack.


BLITZER: Thanks very much.

Go home. Do some Christmas season shopping later tonight.

Thank you.

On our Political Ticker right now, a new glimpse into the Clintons' personal finances. New financial disclosure reports show Bill Clinton earned more than $10 million from giving speeches last year. That's in line with what he earned back in 2006, after big jumps in his income from paid speeches in previous years, as well.

Remember, for the latest political news any time, check out

A candidate and his shoes -- shoes. Jeanne Moss has our Moost Unusual look at how Senator John McCain stays grounded on the campaign trail.

And a major Canadian roadway cut off after a cliff crashes on to it. It's one of today's Hot Shots. You'll see it right here in THE SITUATION ROOM.


BLITZER: Here's a look at some of the Hot Shots coming in from our friends over at the Associated Press.

In Brazil, a man holds a penguin that washed up at the beach.

In Austin, Texas, men repair the roof of the governor's mansion. It was torched by an arsonist last month.

In Canada, a road is blocked by fallen rocks. Check it out.

And in Beijing, volunteers hold flags during a rehearsal for the Olympic opening ceremonies. Some of this hour's Hot Shots -- pictures worth a thousand words.

Senator John McCain seems to have a thing for his loafers.

But will they give him a foot up on his rival?

Jeanne Moos, of course, has our Moost Unusual look.


JEANNE MOOS, CNN CORRESPONDENT (voice-over): We don't expect John McCain to be on a shoestring budget when it comes to shoes.

But $520 Ferragamo calf skin loafers?

UNIDENTIFIED FEMALE: I feel pretty, oh so pretty.

MOOS: It wasn't pretty when the liberal Huffington Post style section revealed Loafer Gate -- photos of McCain wearing the same $520 Italian shoes on a golf cart ride and on a stroll to a grocery store where his Ferragamos narrowly missed getting buried in an apple sauce avalanche.

(on camera): Now, Neiman Marcus carries the pricey Ferragamo shoes. And here at their Web site, you can experience what it feels like to literally walk in John McCain's shoes.

(voice-over): Check out that buckle. The author of "The Perfect Fit: What Your Shoes Say About You," had this to say about what the senator's shoes say.

MEGHAN CLEARY, AUTHOR: I would say flashy. And I wonder if McCain fancies himself a bit of a fashion plate.

MOOS: We're guessing maybe the senator has some help in the shoe shopping department from his fashion plate wife.

But wasn't Senator Obama the guy being called an elitist?

UNIDENTIFIED FEMALE: Looking too much like a "GQ" cover who's aloof.

MOOS: There he is. But Obama got a dressing down from his family on "Access Hollywood."

MICHELLE OBAMA, WIFE OF BARACK OBAMA: These pant he's had for probably about 10 years.



UNIDENTIFIED FEMALE: The belt's a little worn (INAUDIBLE) actually, now that I look at it.

UNIDENTIFIED CHILD: That belt. M. OBAMA: And don't pan down to the shoes because we talked about getting new shoes for him.

B. OBAMA: I have four pairs of shoes.

CLEARY: That's a really typical average guy count on shoes.

MOOS: Lest you think voters don't notice footwear...

UNIDENTIFIED MALE: Would you tie your shoes so that you don't trip over it?

MOOS: She did. Holes in the soles seem to impart campaign trail cred. In 1952, a hole in Adlai Stevenson's shoe led to a campaign jingle.

UNIDENTIFIED FEMALE: I'd rather have a man with a hole in his shoe than a hole in everything he says.

MOOS: And I'd rather have a man with a hole in his shoe than a man with a hole in both socks, like former World Bank President Paul Wolfowitz.

Some are using shoes to both campaign and entertain.

UNIDENTIFIED MALE: Air Obamas -- they're presidential.

MOOS: Presidential candidate McCain was spotted wearing his $520 Italian shoes when he met with the Dalai Lama. Though it was hard to notice their feet --

-- what with all the hand holding. The Dalai Lama was wearing sandals. So should they meet again, perhaps this simple $275 Prada sandal might work for Senator McCain.

Jeanne Moos, CNN, New York.


BLITZER: Thank you, Jeanne.

We just got an update, by the way. For those of you who want to know, does New Mexico Governor Bill Richardson still have the beard?

Paul Shipley, his aide, just e-mailed me to say yes, indeed. There it is. There's the beard. He has not shaved yet. We assume at some point he will. But the beard still remains.

I'm Wolf Blitzer in THE SITUATION ROOM.

Thanks very much for joining us.

Up next, "LOU DOBBS TONIGHT" -- Lou.