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Fight For the Middle Class; Ohio Voting Problems

Aired October 23, 2008 - 18:00   ET


WOLF BLITZER, CNN ANCHOR: And, to our viewers, you're in THE SITUATION ROOM.
Happening now: John McCain channels Joe the plumber in Florida, while Barack Obama accuses him of favoring Joe the CEO. This hour, the late fight for middle-class voters, are both candidates pandering? The best political team on television is standing by.

Plus, first, Colin Powell endorsed Obama. Now another former member of the Bush administration is following his lead. CNN is working the story.

And Hillary Clinton gets busy on the campaign trail. Now she is helping Obama, other senators, and herself.

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

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

This hour, John McCain's presidential hopes are riding on Florida. He is on a bus tour through that important battleground state, and he is relying on some familiar themes to try to get traction. But he got a little sidetracked along the way, when the subject of Sarah Palin's expensive wardrobe came up.

Let's go the CNN's Dana Bash. She's live in Florida. She's watching what is going on. What is going on? I see a big rally under way behind you, Dana.

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT: That is right. I am sure you can hear it. John McCain is literally about to walk in the room here. And, obviously, his supporters are very excited about this -- about that.

This is his final rally of the day. He has been crisscrossing the critical central part of the state, Wolf. And of all of the states up for grabs, Florida's 27 electoral votes really does bring the biggest prize. And John McCain is behind here. He is trying to catch up, and he's doing it with relentless attacks on Barack Obama's tax policy.


BASH (voice-over): A daylong Florida bus tour that John McCain's campaign dubbed, you guessed it, the Joe the Plumber tour. But Joe wasn't here. McCain instead sat with a group that included Tom the Contractor and Richard the Florist.

Florida voters, McCain aides said, are concerned about tax hikes under Barack Obama, though reporters were rushed out and not permitted to hear for themselves. All day, McCain continued to use the Joe metaphor to pound Obama's tax plan.

SEN. JOHN MCCAIN (R-AZ), PRESIDENTIAL CANDIDATE: Whether it's Joe the Plumber in Ohio or Joe over here, we shouldn't be taxing our small businesses more, as Senator Obama wants to do. We need to be helping them expand their businesses and create jobs.

BASH: But back on his bus, evidence that McCain's message about fighting for the average Joe has been muddled. Local reporters repeatedly pressed McCain about Sarah Palin's RNC-financed $150,000 wardrobe, which McCain reportedly was unhappy about having to explain.

She needed clothes at the time. They'll be donated at the end of this campaign, McCain told reporters.

Meanwhile, it's not just Obama that McCain is fighting in these final days. Increasingly, it is also George W. Bush.

In an interview with The Washington Times, a rapid-fire attack on a slew of Bush policies. Spending, the conduct of the war in Iraq for years, growth in the size of government larger than any time since the Great Society, obviously failure to both enforce and modernize financial regulatory agencies, failure to address the issue of climate change seriously... those are just some of them, he finally joked.

Taking more decisive steps like that to separate himself from the unpopular president is something McCain aides tell CNN they wish he did long ago.


BASH: And to that end, McCain did something shall we say rather audacious, Wolf. He actually tried to link Barack Obama to George Bush.

He did it in a statement reacting to the bad-news jobs report that came out today. And I want to put this up on the screen and the wall for our viewers to see it.

Here's what he said. He said, "Barack Obama's only answer is to double down on the Bush administration's legacy of out-of-control spending, raise taxes on small businesses, impose mandates on employers." And, Wolf, it went on from there.

BLITZER: All right, that's a new line from the senator, trying to link Barack Obama to George W. Bush, as opposed to himself. All right. We will watch this. Dana, thank you.

Barack Obama is now heading to Hawaii to see his very sick 85- year-old grandmother after getting in some quality time out on the campaign trail earlier in the day.

During an event in Indiana, Senator Obama also worked in a few verbal shots at John McCain.

Let's go to CNN's Jessica Yellin -- Jessica.


JESSICA YELLIN, CNN CONGRESSIONAL CORRESPONDENT (voice-over): Wolf, in Indiana today, Barack Obama was on the offense. Not only is he trying to take this red state from his Republican opponent; he is also fighting to turn John McCain's new message about taxes against him. Five months ago, Barack Obama narrowly lost the Indiana primary to Hillary Clinton the populist.

SEN. HILLARY RODHAM CLINTON (D-NY), FORMER PRESIDENTIAL CANDIDATE: And I have gone all across Indiana. I have said my campaign is about jobs, jobs, and jobs.

BASH: Today, so is Obama's.

SEN. BARACK OBAMA (D-IL), PRESIDENTIAL CANDIDATE: Where I come from, there's nothing more fundamental than a good-paying job.

YELLIN: With that message, Obama has come to within five points of John McCain in Indiana, a state so red it, it last elected a Democratic president 44 years ago. But McCain is trying to shift focus from jobs to taxes, launching a fuselage of attacks on the Obama tax plan.

UNIDENTIFIED FEMALE: I'm Joe the plumber.

UNIDENTIFIED FEMALE: I'm Joe the plumber.

UNIDENTIFIED FEMALE: Barack Obama: higher taxes, more spending, not ready.

YELLIN: So now Obama is taking aim at McCain's tax policy.

OBAMA: You know, there's a building in the Cayman Islands that supposedly houses 18,000 corporations. Think about that. That's either the biggest building or the biggest tax scam in the world. I think we know which one it is. That's the system my opponent defends.

YELLIN: And mocking McCain for telling Wolf Blitzer he believes high taxes drive American companies overseas.

MCCAIN: We should be cutting corporate tax for every business in America.

YELLIN: Says Obama --

OBAMA: More tax cuts for jobs outsourcing, that's what Senator McCain proposed as his answer to outsourcing. He said that's simple fundamental economics. I say let's end tax cuts for companies that shift jobs overseas, give them to companies that are investing right here in Indiana, right here in the United States of America.

YELLIN (on camera): And now, Wolf, Barack Obama is taking two days off to spend time with his grandmother. By all accounts, she is gravely ill. He will return to the campaign trial with stops in Nevada on Saturday -- Wolf.


BLITZER: And we wish her only the best. Jessica, thank you.

A dozen days before the presidential election, Barack Obama and John McCain certainly have come a long way, but with Obama now holding an eight-point lead in our new poll of polls averaging the latest national surveys. Back in June, by the way, when the general election effectively began, Obama was ahead by four points. McCain briefly moved ahead of Obama after the Republican National Convention in early September. Eight percent still are unsure how they will vote. That is just slightly less than back in June.

The economy, of course, is front and center in voters' minds and today was another roller-coaster ride for the Dow Jones industrials.

Let's go right to CNN senior basically correspondent Ali Velshi. He's watching this story for us.

It closed up, but Wall Street, I think it's fair to say, Ali, very much on edge right now.


And the beauty of it closing up is, we don't have the spend too much time on markets, because this must be exhausting, even for our viewers, to try and keep track of everything that is going on. What you need to think about is really the biggest problem in the economy in the months ahead and the one that we have really got to keep a tight eye on, and that is jobs.

Dana referred to a jobs report that came out today. Let me show you what it is. It is the weekly report of the people who filed for jobless claims for the first time. So, we get that report today and that talks about the week ending of October 18th, last week. We expected to be 465,000 people filing for unemployment claims for the first time last week. The number was 478,000. Anything above 400,000 is bad news. Anything above 400,000 is bad news for the economy and is thought of as a recession.

Now, the other thing we have been getting, Wolf -- we talked about this yesterday -- we will talk about it again today -- we have been getting more job cut news. Chrysler has shut down one shift at its north Toledo, Ohio, plant. That's 825 jobs. Goldman Sachs laying off 3,260 people.

And yesterday we told you about Yahoo! and Merck and their layoffs. So we have got about 8,500 announced layoffs this month. And that generally indicates that there's a lot more underlying that.

The bottom line is, Wolf, how do you recover an economy with people continuing to lose jobs? Now there's two weeks -- less than two weeks to go to the election. We won't have the next job report for two weeks. In other words, that will be after the election. So, at this point, this is the information that these candidates have to go on. We are expecting to continue to see more job cuts in the next two weeks.

BLITZER: And there will be political ramifications, no doubt about that.


BLITZER: Ali, thanks very much.

A huge reason for the market turmoil, the housing mortgage meltdown. More than 81,000 homes were foreclosed in September alone, 81,000 homes. But help could be on the way to help keep some cash- strapped homeowners in their homes. The Treasury Department and the Federal Deposit Insurance Corporation are now working together to try to prevent unnecessary foreclosures.

Under the plan, the Treasury Department would provide guarantees to mortgage lenders and that's aimed at getting them to modify and streamline those loans to make them more affordable and homeowner friendly. We will continue to watch this important story.

A dire warning coming in from the former chairman of the Federal Reserve. He is called on the carpet by Congress. Alan Greenspan says America is in the midst right now -- and I'm quoting him -- of a once- in-a-century credit tsunami.

Lines so long, some voters could not even cast ballots, that is what happened in Ohio last time around, four years ago. Here is the question. Has anything changed since then? We are on the scene in that key battleground state. There is concern it could be even worse this time.

And she is barnstorming for Barack Obama, also making a pitch for key congressional candidates.


CLINTON: With your help, America will once again rise from the ashes of the Bushes.



BLITZER: We have some brand-new poll of polls from the crucial battleground states. Let's check them out.

First, Florida, right now, in our poll of polls, 48 percent for Obama, 45 percent for McCain, seven percent unsure, three-point advantage for Obama in Florida. Let's take a look at the next poll right now. That would be West Virginia. McCain in this CNN poll of polls, 47 percent, Obama 45 percent in West Virginia. That is a significant narrowing from where it was in that CNN/"TIME" magazine poll only yesterday, West Virginia. Let's go to the next poll. It's Pennsylvania. Right now, Obama is at 51 percent, 41 percent for McCain. That is a 10-point advantage, eight percent still unsure. In Virginia, Obama is ahead right now in our poll of polls by, what, eight points, Obama 51, McCain 43, six percent remaining unsure.

In Nevada right now, Obama is holding a steady lead, four points, Obama 49, McCain 45, six percent unsure. Finally, in the key battleground state of Ohio -- no Republican has ever been elected president without winning Ohio -- right now, in our poll of polls, Obama at 50 percent, McCain at 43 percent, seven percent unsure. That is a seven-point advantage in Ohio right now for Barack Obama.

People are waiting for hours to cast their ballots, many saying they could not even vote. That was the scene in parts of Ohio in the last presidential election four years ago. Here is the question. Could it be even worse this time around?

Mary Snow is one of CNN's dedicated correspondents covering the battleground states for us.

All right, Mary, what is the answer? Are we going to see these problems again?

MARY SNOW, CNN CORRESPONDENT: Wolf, one expert who is being paid to take a look at all the scenarios here says there is the potential that things could be worse this time around. Of course, election officials are trying to avoid that by trying to encourage as many people as possible to get to the polls before November 4.


SNOW (voice-over): Ohio is hoping its early voting will prevent a repeat of this, lines that lasted for more than five hours in places like Franklin County, which includes Columbus.

Engineering professor Ted Allen was hired by the county to look at what went wrong.

TED ALLEN, ENGINEERING PROFESSOR, OHIO STATE UNIVERSITY: We estimate that between 20,000 and 30,000 people were deterred from voting.

SNOW: Twenty thousand to 30,000 people who couldn't vote, and that's just in one county.

Allen says lines were longest in urban areas. And, as a result, African-Americans, on average, had to wait half-an-hour longer than everyone else to vote. One big problem? Not enough machines. The state has doubted the number from 2004.

UNIDENTIFIED MALE: The first thing the voter would do would be to vote on this page.

SNOW: Touch-screen machines like these will be used in Franklin County for the first time in a presidential election. Ohio's secretary of state, Jennifer Brunner, who inherited the machines, was so skeptical of them, she ordered backup paper ballots at polling places.

JENNIFER BRUNNER, OHIO SECRETARY OF STATE: We -- we have very poorly engineered systems, that I know that there are some on the horizon that would be an improvement, but we're waiting on a very slow federal certification and testing process.

SNOW: There's more emphasis on better training for poll workers.

UNIDENTIFIED FEMALE: If David's address or what he provides me with does not match what I have in here, that's not going to work.

SNOW: We did a walk-through of the early voting process using a paper ballot. State and local ballot measures make it lengthy.

MICHAEL STINZIANO, DIRECTOR, FRANKLIN COUNTY, GEORGIA, BOARD OF ELECTIONS: In the time wait study we did, it takes about seven to nine minutes for the average person.

SNOW (on camera): OK.

STINZIANO: Obviously, we have seen anywhere from maybe three minutes to an hour.

SNOW (voice-over): Crunching the numbers into simulations, Ted Allen says long ballots, coupled with high turnout, could be problematic.

ALLEN: Amazingly it, takes so much longer to vote with the new machines, we're predicting that there might be lines, and, depending on the turnout, it might actually be worse than 2004.

SNOW (on camera): Worse than 2004?

ALLEN: Possibly.


SNOW: And, Wolf, here in Franklin County, some people are being asked to vote on as many as 24 state races or ballot initiatives. County officials are saying they are encouraging people to look at a Web site of a sample ballot. But, still, there is record turnout expected on Election Day -- Wolf.

BLITZER: Wow. OK. We will watch it with you. Mary is part of our battleground coverage reporters. She and several others are dedicated in heavily contested states all the way through Election Day to work there every single day. Stay tuned for more of their reports on all of the issues important to these states and important to you.

In these last days before the election, Hillary Clinton is crisscrossing the country, aiming to pump up support, not just for Barack Obama, but also for Democrats in key congressional races, and Senate races as well, including Al Franken in Minnesota. Let's go to CNN senior political analyst Bill Schneider. He's working the story for us. Bill, are the Democrats bringing in a new contender into this race?

WILLIAM SCHNEIDER, CNN SENIOR POLITICAL ANALYST: Actually, an old contender who has been around the track many times.


SCHNEIDER (voice-over): The marathon runner is back in the race.

CLINTON: We are 15 days from the finish line. This has been a marathon race.

SCHNEIDER: Hillary Clinton is out on the campaign trail rallying the troops for Barack Obama.

CLINTON: Will you vote today? Go right from here to vote.

SCHNEIDER: And for Democratic House and Senate candidates like Al Franken in Minnesota.

CLINTON: Now, it's said you can't go home again, but for Al, I don't think he ever really left. He certainly left his heart here in this state.

SCHNEIDER: Senator Clinton has reactivated her political action committee which contributes to Democratic congressional campaigns. If Obama wins, it's likely to shut down the Democratic nomination until 2016. If Obama loses, Clinton becomes the instant front-runner for 2012.

Is it really in Senator Clinton's interest for Barack Obama to get elected? The question came up at a bipartisan dinner last week.

MCCAIN: I can't shake that feeling that some people here are pulling for me.


MCCAIN: I'm delighted to see you here tonight, Hillary.

SCHNEIDER: Clinton may be making a different calculation -- that Democrats are likely to enjoy a big victory this year. She wants it to be her victory, too. She's bursting with ideas.

CLINTON: Jobs, baby, jobs. That's what we're for! With your help, America will once again rise from the ashes of the Bushes. Tell them Hillary sent you to vote for Barack Obama.

SCHNEIDER: Clinton lost the nomination but she gained respect during the course of the primary campaign. Her favorability ratings went up. That doesn't look like a loser.

(END VIDEOTAPE) SCHNEIDER: If Obama wins, Clinton could be the leading force in the Senate for his agenda, and possibly one day the first woman to become Senate majority leader -- Wolf.

BLITZER: Bill Schneider, working the story, thank you.

Hillary Clinton, by the way, is not the only Clinton showing support for Barack Obama and other fellow Democrats, Bill Clinton also out there on the campaign trail. He is heading to Kentucky tomorrow to campaign for Bruce Lunsford. Lunsford is locked in a tight race for Kentucky's U.S. Senate seat against the Republican incumbent, Mitch McConnell, the Senate minority leader. We will be all over that story tomorrow.

Joe Biden takes aim at John McCain, Barack Obama's running mate saying McCain is getting out of control on the campaign trail. But will this campaign tactic trump Joe the plumber?

And billion-dollar bonuses to Wall Street execs, sounds like it what it used to be before the global financial bailout, but would you believe, guess what, it is happening right now?

And a stunning endorsement for Barack Obama. You're going to find out who is crossing party lines. We are talking about that and more with the best political team on television.

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



BLITZER: The former Federal Reserve chairman Alan Greenspan is warning the nation that -- the nation, that is, is in dire economic straits, but he doesn't seem entirely sure how we got here.


ALAN GREENSPAN, FORMER FEDERAL RESERVE CHAIRMAN: The problem here is something which looked to be a very solid edifice and indeed a critical pillar to market competition and free markets did break down. And I think that, as I said, shocked me. I still do not fully understand why it happened.


BLITZER: Greenspan giving members of Congress an earful today, and they gave it right back to him.

And new reason for Americans to be outraged by Wall Street. Why are firms that are getting bailed out giving corporate big shots big, fat bonuses? Brian Todd standing by.

And John McCain is accusing Barack Obama of saying anything to win. Could that be said of both presidential candidates? The best political team on television is standing by for us on that score. Stay with us. You're in THE SITUATION ROOM.


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

Happening now: For years, his words were financial gospel, but the former Federal Reserve chairman Alan Greenspan admits he made a key mistake during his tenure. Should he shoulder any blame for the mortgage meltdown? Stand by.

Wall Street gets a $700 billion bailout at taxpayer expense, but is that money going to billion-dollar bonuses for some of the execs?

And the Obama campaign strikes back with accusations about McCain's alleged loss of control on the campaign trail -- all of this coming up, plus the best political team on television.

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

A disturbing description today of America's economic crisis, the former Fed chairman Alan Greenspan telling Congress that the nation is in the midst in his words of a once-in-a-century credit tsunami.

Let's go to our senior correspondent, Allan Chernoff. He is working the story for us.

The Alan Greenspan we saw today, there's no doubt about it, was not the Alan Greenspan who appeared so many times before Congress over the years when he was the chairman.

ALLAN CHERNOFF, CNN SENIOR CORRESPONDENT: That is right, Wolf. We are used to seeing Alan Greenspan as the financial guru. He essentially was the finance professor when he appeared before Congress. For the 18 years that he was chairman of the Federal Reserve, congressmen were pretty much his students, but not today. Today, he was humbled before Congress.


REP. DENNIS KUCINICH (D), OHIO: You, Mr. Greenspan, promoted adjustable-rate mortgages that fueled the subprime market.

CHERNOFF (voice-over): For a change, it was former Federal Reserve chairman Alan Greenspan who was getting a lecture from Congress -- not the other way around.

REP. JIM COOPER (D), TENNESSEE: What did you do in your tenure to help Americans and to help Congress understand the real numbers for America?

CHERNOFF: Some members of Congress blamed Greenspan for the financial crisis because he used to run the nation's central bank.

REP. HENRY WAXMAN (D), CALIFORNIA: The Federal Reserve had the authority to stop the irresponsible lending practices that fueled the subprime mortgage market. But its long-time chairman, Alan Greenspan, rejected pleas that he intervene.

CHERNOFF: Congress' General Accounting Office, in 1994, warned of the dangers of financial derivatives like mortgage-backed securities. Greenspan, a fierce advocate of free markets and finance, said at the time banks could handle any problems themselves.

WAXMAN: My question for you is simple, were you wrong?

GREENSPAN: Well, partially.

CHERNOFF: The former Fed chairman admitted he's stunned that banks failed to control their risk taking.

GREENSPAN: I made a mistake in presuming that the self-interest of organizations, specifically banks and others, was such as that they were best capable of protecting their own shareholders and the equity in the firms. I think that, as I said, shocked me. I still do not fully understand why it happened.

CHERNOFF: But Greenspan refused to take blame for what he described as a once in a century credit tsunami, arguing it's the fault of banks and other big investors, who became too greedy in trying to profit from the mortgage boom.


CHERNOFF: Some congressmen were still interested in hearing Greenspan's forecast. And he's predicting tough times ahead -- rising unemployment. And he says that the economy won't improve until housing stabilizes, which he says is a good number of months away -- Wolf.

BLITZER: We've got a lot of problems ahead of us before this thing gets better. Alan, thank you.

On Wall Street, the Dow was up 170 points today. But there's still outrage aimed at some firms that are taking government bailout money with one hand, while still handing out massive bonuses with the other.

Brian Todd has been working this story for us -- Brian, what is going on?

BRIAN TODD, CNN CORRESPONDENT: A big part of this, Wolf, is the culture of Wall Street not changing yet. With loopholes in the government's new rules on executive pay, we've learned many of these banks are up to the same old tricks.


TODD (voice-over): You're figuring out how to stay in your home. Your taxpayer dollars are going to investment banks to keep them solvent. But some of them are doling out tens of billions of dollars for employee bonuses and salaries.

REP. DENNIS KUCINICH (D), OHIO: The banks and these other firms feel that they can just take this money and distribute it for bonuses? Are you kidding me? I mean this -- this goes beyond unfair. This is an outrage.

TODD: Congressman Dennis Kucinich is asking his staff to investigate how widespread this is. We were able to get figures for four major banks. Goldman Sachs had set aside $13.5 billion through the third quarter for pay packages. At Goldman, that averages out to more than $414,000 per employee. Morgan Stanley has accrued $10.7 billion through three quarters; Merrill Lynch, $11.2 billion; and Citigroup, which has an investment and a deposit bank, has set aside more than $25.8 billion.

Total -- more than $61 billion set aside in salaries and bonuses for the first three quarters. At three of the four, those numbers are down from the same period last year.

Contacted by CNN, representatives of all four denied being irresponsible with the government's money. Some said their top execs didn't take bonuses last year. Others said they're cutting costs and laying off people. Merrill Lynch said some of this money is performance-based. But with performances that led to a financial crash, some compensation experts try to put the outrage in context.

PROF. KEVIN J. MURPHY, UNIVERSITY OF SOUTHERN CALIFORNIA: If they can't pay them in form of bonuses, they'll pay them in the form of salaries. If they can't pay salaries, they'll find some other way to pay them. And if they can't find another way to pay them, they will lose their top talent to hedge funds, private equity or other unrestricted markets. And that's going to be bad news for taxpayers, for shareholders and the financial markets.


TODD: But another analyst tells us hedge funds are in big trouble. Many have gone bust, he says. And the ones that remain in business are laying people off, Wolf.

It's pretty bad all the way around.

BLITZER: But some of those banks that are involved in this -- they're taking government's cash, but they really didn't want to take some government cash. So what's that part of the story all about?

TODD: That's right. And you've got to be fair to those banks. Citigroup is one of them. You know, when it's been raising capital and laying off people for a year, not going under. When Henry Paulson sat down with these other banks that were failing and injected cash into them, he said he's going to inject cash into banks like Citigroup, too. Citigroup accepted that to reinvigorate lending activities. So when you talk about these pay practices, you've got to be fair to banks like Citigroup, that were not going under.

BLITZER: Brian Todd, thanks very much for the story.

Push comes to shove out there on the campaign trail.

(BEGIN VIDEO CLIP) SEN. JOSEPH BIDEN (D-DE), VICE PRESIDENTIAL CANDIDATE: I'll talk a little bit in terms of racing terms. Right now, right now, our campaigns are trading a little paint.


BLITZER: Joe Biden says John McCain doesn't have a steady hand on the wheel. The best political team on television is all over that one.

And from a giant sized puppet of Barack Obama to a "Joe the Plumber's" costume, CNN's Jeanne Moos -- she'll bring us the Moost Unusual side of this campaign.

Stick around. You're in THE SITUATION ROOM.



MCCAIN: Twelve days to go, 13 days to go in this election and he changed his tax plan because the American people had learned the truth about it and they didn't like it.


MCCAIN: It's another example that he'll say anything to get elected.


BLITZER: Allegations of pandering in these, the final days of this campaign.

Let's discuss this and more with our senior political correspondent, Candy Crowley; our political contributor, Dana Milbank of "The Washington Post;" and Steve Hayes, the senior writer for "The Weekly Standard."

Guys, thanks very much.

It's getting a little rough, but it expected in these final days, shouldn't it be?

CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT: Absolutely. I mean this is -- boy, this is when they pull everything out, particularly if you're John McCain and you're running behind, you pull out what you've got. If you don't do it now, you can't do it Wednesday after the election.

It is not all that unusual for candidates to each accuse the other of pandering or saying anything and doing anything, because it brings up that sort of craven politician thing. So it's not at all surprising.

BLITZER: And you heard Dana Bash say that McCain is now suggesting if you liked the policies of President Bush over the past eight years, vote for Barack Obama, because he's going to be more Bush.



MILBANK: Throw everything out there right now. And this is the time in which they do this. I suspect it will get -- it could and will get a lot worse than this. I mean, you know, saying that a guy will say anything to get elected, well, that's pretty much the definition of politics right now. And it's virtually the same line that Bush used against Gore and Kerry. So it's actually a retread. I think they can get much worse than this.

BLITZER: And listen to Senator Biden, Steve, because he's also out there saying a lot of things.

Listen to this.


BIDEN: You know that term getting a little loose on the -- you know, when you're out there going 185 miles an hour, getting a little loose?

Well, John is getting a little loose. He doesn't have much of a steady hand these days. And now -- and now is the time, now is the time when we most need a steady hand.


BLITZER: All right. That's part of theme, that he's erratic and, you know, he's jumping all over the place. So, what do you think?

STEPHEN HAYES, SENIOR WRITER AT "THE WEEKLY STANDARD": Well, I think any time Joe Biden is talking about NASCAR, that is saying anything and pandering to the voters.


HAYES: I mean the interesting thing about that is that as he was, you know, sort of playing with this NASCAR metaphor, the crowd in North Carolina was utterly silent -- didn't react, didn't laugh the way that he thought they would laugh. I mean I think it came off as inauthentic, as somebody who's probably never been to a NASCAR event by choice talking about NASCAR in a way.

BLITZER: Although there is a NASCAR in Delaware.

HAYES: There's a NASCAR race in Dover.


HAYES: I don't know whether he's gone to any (INAUDIBLE) by choice. BLITZER: I don't know if he hangs out there, but I assume as a politician in Delaware, he probably shows up there once in a while.

CROWLEY: And he probably knows, coming from Delaware, where NASCAR is. Look, you know, it probably didn't go over because I actually don't get that 185 miles an hour and you're, you know, a little loose. But here's what it goes to. It goes to what the Obama campaign has been saying for several months now and trying to get out there -- there's something off here. You know, it's a he's not steady, he's -- there's a little bit something weird.

MILBANK: Yes. Maybe they should just come out and say he's old and crazy.

CROWLEY: That's exactly what he said.

MILBANK: That's what they're trying to do.

CROWLEY: Which is a better -- they're trying to say it without saying it.

MILBANK: The other side says that, well, that guy is a terrorist. I mean, we're -- let's stop beating around the Bush here.


BLITZER: Yes. But in the polls, it does show that he has a problem on this issue, that he was all over the place on the economy. I'm talking about Senator McCain.

HAYES: Yes, I think the problem for Senator McCain is this is the narrative that the Obama campaign has tried to peddle for months and months. And he, because of his actions on the economy, has sort of fueled it, in a sense, to use further NASCAR analogies.

BLITZER: Only 12 days left. Some people say we can't wait for this to be over with, but there are others -- maybe me -- who like watching these political players in action. I know you're anxious for this to be over with.

CROWLEY: You know, we have a -- just to tell a little inside story from CNN. We have a great researcher named Rob Yuen (ph) and we also say, you know, 12 more days, 12 more days. And he goes until an automatic recount in 17 states.




BLITZER: We've been there.


CROWLEY: That's because we (INAUDIBLE)... BLITZER: We've been there and done it. It was a long night in 2000. Do you remember that night in 2000?

MILBANK: It's all getting a bit hazy now. I've tried to repress the memory. But, you know, they've got teams of lawyers ready for this eventuality. But I'm calling in sick on Wednesday.

BLITZER: Yes, I remember. We flew down to Tallahassee for about 30 days. It was that -- that's unlikely to happen this time.

Stand by, guys. We've got much more to talk about.

It took some pleading, but CNN's newest star, D.L. Hughley, breaks some news.


D.L. HUGHLEY, HOST: But you haven't endorsed anybody. You haven't endorsed anybody.


HUGHLEY: And it's McCain and it's Obama. You know, and I'm a new show and your endorsement would probably mean a lot. But -- and don't look at the fact that I'm black or nothing like -- no pressure. Endorse somebody, damn it. Endorse somebody.



BLITZER: President Bush's former press secretary, Scott McClellan, comes through and makes an endorsement. You're going to hear who he wants to be the next president.

And he's made a pick of his own, but listen to the pop star piano man. Billy Joel sounds off on the celebrity endorsements.


BILL JOEL, MUSICIAN: People pay for tickets. I don't think they want to hear what you -- who you're going to vote for or what, you know, how you think they should vote.




HUGHLEY: But you haven't endorsed anybody. You haven't endorsed anybody.


HUGHLEY: And it's McCain and it's Obama. You know, and I'm a new show and your endorsement would probably mean a lot. But -- and don't look at the fact that I'm black or nothing like -- no pressure.

Endorse somebody, damn it. Endorse somebody.

MCCLELLAN: From the very beginning, I've said I'm going to support the candidate that has the best chance of changing the way Washington works and getting things done. I will be voting for Barack Obama.




BLITZER: All right. Scott McClellan breaking the news on D.L. Hughley's new show. What do you think, Steve, the former press secretary of the White House for President Bush endorsing Barack Obama?

HAYES: Well, I think all over the country, Republicans are saying to themselves can we get Scott to go work for Barack Obama to give John McCain a chance in these last two weeks? I think it's probably too late.

BLITZER: You're not surprised by this, are you?

MILBANK: Well, I'm picturing the guy in his living room out there saying well, I'm not sure about that Colin Powell endorsement, but that Scott McClellan --


MILBANK: Yes. That's the ticket for me.


BLITZER: Yes. That's really going to turn things around.


BLITZER: You know Scott McClellan.

CROWLEY: I do. I do. Good television, I agree. I'm not sure anybody out there is going to go OK.

But, I mean, look, it's always stunning for those of us who know Scott McClellan or who watched, you know, his total allegiance to George Bush coming up to think wow, you know, eight years later, here we are.

But in terms of affecting this election --

BLITZER: But given the book that he wrote, none of us should have been surprised, because he was very harsh in that book. You remember that, Steve. HAYES: Yes, he was critical. I mean I think the book contained a lot of platitudes about bipartisanship and things that, you know, sound nice in a book and sound nice when you're criticizing your former boss. But at the end of the day, I don't, you know, I don't think any of us were surprised. I don't think this will surprise anybody.

BLITZER: Were you surprised at Ken Adelman? Do you remember Ken Adelman? He endorsed Barack Obama, too. He was a former Pentagon official in, what, the Reagan administration.

MILBANK: Exactly. And the man who spoke of a cake walk occurring in Baghdad.


MILBANK: So, yes, that was. And he had an advisory role early in the Bush Pentagon, as well. You see a bunch of these happening over and over again.

I'm sure the Republicans would say rats on a sinking ship. But I don't think anybody would dispute that that ship has already foundered.

BLITZER: And there are Democrats who support John McCain, including Joe Lieberman. So you can't forget that.

CROWLEY: Absolutely. So it's a -- you know, we talk a lot about how the map is beginning to mix up and it's not going to be the same way that it's been before, with the red states and the blue states. I think we've seen some cross allegiances here that are sometimes political and sometimes heartfelt.

BLITZER: Guys, thanks very much.

You can see, by the way, the premier of the D.L. Hughley's program. It's called "D.L. Hughley Breaks the News," this Saturday night, 10:00 p.m. Eastern, 7:00 Pacific only -- only here on CNN. Check it out.

Some controversy over an interview that the Republican vice presidential nominee, Sarah Palin, gave. She gave it to our Drew Griffin. He interviewed the governor this week. You saw it here in THE SITUATION ROOM -- Drew, as you know, you're being criticized for one question that you answered Governor Palin. Tell our viewers what the issue is.

DREW GRIFFIN, CNN SPECIAL INVESTIGATIONS UNIT: Wolf, the issue was really the setup to a question in that 25-minute interview.

First, I want you to hear what this is all about.

Here's the question.

(BEGIN VIDEOTAPE) GRIFFIN: Governor, you've been mocked in the press. The press has been pretty hard on you. The Democrats have been pretty hard on you. But, also, some conservatives have been pretty hard on you, as well.

The "National Review" had a story saying that, you know, I can't tell if Sarah Palin is incompetent, stupid, unqualified, corrupt or all of the above.


GRIFFIN: The "National Review" is a conservative magazine. And the author, Byron York. Here is what York wrote: "Watching press conference of the Republican candidate for vice president, it's sometimes hard to decide whether Sarah Palin is incompetent, stupid, unqualified, corrupt, backward or -- or, well, all of the above."

Unfortunately, in my question, I botched it. I misquoted York by using the word I instead of reading his direct quote, which I had in front of me, which attributes the statement to the media.

I thought it was a very good article, Wolf. I was going to get it -- use it to get the governor to answer the question why her, you know, successful record in Alaska wasn't getting out. She had no trouble answering that question and in no way did I intend to misquote the "National Review".

The exchange aired just once on your show, Wolf. And as soon as the "National Review" brought it to our attention at 7:05, we immediately realized that context could be misconstrued and we cut that portion of the interview. It never aired again.

We also sent a statement directly to the "National Review" explaining what happened and that we do not plan to run it again.

And I've since called Byron York and his editor, Rich Lowry, explained what happened and told them both that I regret any harm this may have brought -- Wolf.

BLITZER: All right, Drew. Thanks very much. Drew Griffin reporting for us.

The campaign is getting "Moost Unusual" -- from a 13-foot tall Barack Obama puppet to a "Joe the Plumber" costume. CNN's Jeanne Moss has it covered.

She's the one conservative voice on "The View." And now Elisabeth Hasselbeck is ready to hit the road for a candidate. You won't be surprised who that candidate is.


BLITZER: Let's take a look at some of the "Hot Shots" coming in from our friends at the Associated Press -- pictures likely to be in your newspapers tomorrow.

In India, stranded travelers get rest after several trains were canceled due to track vandalism.

In Turkey, a demonstrator places stickers to protest a head scarf ban at universities.

In London, an engineer performs maintenance on the Millennium Bridge.

And in Ukraine, a musician plays violin by the subway to earn some money.

Some of this hour's "Hot Shots" -- pictures worth a thousand words.

On our "Political Ticker," the piano man defends his decision to take sides in the presidential race. Billy Joel recently teamed up with fellow musician Bruce Springsteen for a concert to benefit Barack Obama. Today Joel appeared at the National Press Club here in Washington to explain why it's so important for him to get involved.


JOEL: Thank you.

But over the last few months, you know, I just -- there's a quote that keeps occurring to me. And it's a Dante quote. And it says: "The darkest places in hell are reserved for those who maintain their neutrality in times of moral crisis." And I thought oh, OK...


JOEL: All righty. I don't want -- I don't want to be in that place. So -- so I did this fundraiser.


BLITZER: The lone conservative on the daytime talk show, "The View," now is set to campaign with Sarah Palin. Elisabeth Hasselbeck will appear the Republican vice presidential nominee in Florida this weekend. Hasselbeck says Palin invited her to participate and the rally should give her some good stories when she returns to "The View" on Monday.

Just when you thought Barack Obama and John McCain couldn't surprise you after all these months out on the campaign trail, a giant puppet comes along to prove you wrong.

Here's Jeanne Moos with some "Moost Unusual" campaign follies.


JEANNE MOOS, CNN CORRESPONDENT (voice-over): Candidates say the darndest things. Take Sarah Palin, speaking after country star Gretchen Wilson serenaded the crowd about what kind of woman she is.


GRETCHEN WILSON, SINGER (SINGING): I'm a red necked woman.

GOV. SARAH PALIN (R-AK), VICE PRESIDENTIAL CANDIDATE: Someone called me a red necked woman once and you know what I said back?

I said, why thank you.


MOOS: Governor Palin is probably fed up with the press, but at least she hasn't sneezed on us.

OBAMA: It should be the banks taking -- I'm sorry.


OBAMA: I could -- I was fighting that off for a while.

MOOS: Not only did Senator Obama sneeze, he then reached out and touched the poor reporter -- the video is spreading faster than germs on the Web. As is this photo of the senator with holes in his soles. Obama's V.P. soul mate had some trouble with their opponent's name.

BIDEN: John McClain -- John McCain. Excuse me, John McCain.

MOOS: We know John McClain, senator, from "Die Hard."


UNIDENTIFIED MALE: You're still a cowboy, Mr. McClain.


MOOS: And McCain, you're no McClain.


UNIDENTIFIED MALE: Happy trails, Hans.


MOOS: From "Die Hard" to "007," "Parade" magazine asked actor Daniel Craig which candidate would be the better Bond. And Craig said Obama. McCain would be a better M.


JUDI DENCH, ACTRESS: Utter one more syllable and I'll have you killed.


MOOS: Craig said McCain has a kind of Judi Dench quality.

Meanwhile, Sarah Palin told "People" magazine that if she had had another child joining the ranks of Trig and Piper and Trac, she would have named him Zamboni. What, not "Joe the Plumber?" MCCAIN: Joe over here. Thank you, Joe. Joe, thank you. There's Joe.

OBAMA: He's fighting for Joe the hedge fund manager, Joe the CEO.

MOOS: The "Joe the Plumber" costume is big on Ricky's Halloween Web site, though it doesn't amount to much more than a bald cap, a plunger and a name tag.

(on camera): We thought you might like to take a look at a few of our favorite campaign souvenirs, for instance, the Obama and McCain gargoyles. These are the designer Obama underwear. Cap'n McCain's and Obama Os cereal. Custom cereal -- 39 bucks a box. And speaking of boxes, Barack-in-a-Box.

(voice-over): Reminds us of that 13-foot puppet --


MOOS: -- an I-Reporter sent in, intended to encourage early voting in Cleveland, Ohio, who looks like he's had his Wheaties or maybe his Obama O's. Hope in every bowl versus a maverick in every bite.

Jeanne Moos --




OBAMA: I'm sorry.

MOOS: -- New York.


OBAMA: I could -- I was fighting that off for a while.


BLITZER: We want you to check out our political pod cast. To get the best political team to go, you can subscribe at

I'm Wolf Blitzer in THE SITUATION ROOM. See you back here tomorrow.


Lisa Sylvester filling in for Lou -- Lisa?