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JOHN KING, USA

Spy Swap?; President Obama Takes Economic Message on the Road

Aired July 7, 2010 - 19:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


JESSICA YELLIN, CNN ANCHOR: I'm Jessica Yellin. John King is off tonight. And we begin with a mystery that has everyone buzzing. Five suspected Russian spies, they're being moved to New York from jails in Massachusetts and Virginia. They'll be in court tomorrow along with five other suspected Russian agents.

Now, all this on a day that we're hearing about secret talks between U.S. and Russian officials, and getting hints that a spy swap may be in the works. For more on this, I'm joined by CNN's Foreign Affairs correspondent Jill Dougherty.

Jill, really, people are talking about this today. The big question is will there be a swap?

JILL DOUGHERTY, CNN FOREIGN AFFAIRS CORRESPONDENT: Well, they're indicating -- let's put it this way, there are indications that there could be. Nobody is confirming it. Nobody is denying it.

The family of the man who is being held in Russia, who might be part of the deal, is saying, look, he was told that he's on the list, that the United States would like him out, in exchange for these spies being held here. So looks like it could happen, but no confirmation yet.

YELLIN: So presumably -- I mean, the intrigue is what's fascinating about this. Presumably, these people are dangerous that's why we arrested them. Why would we consider giving them back?

DOUGHERTY: Well, there are a couple of reasons. I mean, politically, you'd have to say this is kind of a mess. If you re-set relations between Russia and the United States and this comes up, this is not what the United States wants and it's not what Russia wants either.

So let's make it go away, and in a swap, we'd say, okay, game's over, go home, and -- but there's another part to this, you know, the U.S. could use this to get people out that it wants. This Igor Sutyagin, a researcher, is just one person, but his family says he told them there are 11 people on that list so there could be --

YELLIN: Being held in Russia that the U.S. could get.

DOUGHERTY: So that might be helpful for the United States to get them out.

YELLIN: Even spy stories are about politics, thank you, Jill.

All right and, also, joining us, Joe Johns. The president now taking his economic message on the road. Our question to you, Joe, because so much is going on with the president and the economy, as he prepares to focus on jobs, where is the president going, and why?

JOE JOHNS, CNN SENIOR CORRESPONDENT: He's going to Missouri. He's going to Nevada. One of them is kind of typical for a situation that a midterm president would be in. One of them, sort of atypical.

The typical situation, in Missouri, this is one of those rare Republican open seats, kit bond is leaving that seat on the Republican side, and there's a chance for a Democrat to move into the slot. There are questions about whether the Democrat there has been running away from the president of the United States, as tends to happen in a midterm. So he's going out there, he's going to talk about the economy.

On the other side is Nevada. And that, of course, is the home state of Senate Majority Leader Harry Reid. This is something, a payback, if nothing else. Harry Reid has pretty much delivered for Barack Obama in the Senate every single time he's asked for it, whether it was economic recovery bills, the health care bill whatever.

Harry Reid's done the dirty work. Now, the president needs to go out to Nevada and try to do him a favor and get him elected. A tough race. A tough situation that we all know about there, although, frankly, Harry Reid is looking a little bit better than he was just a few months ago. So perhaps the White House is reading the tea leaves and thinking, yes, he can pull this out and we can say we helped him along, Jessica.

YELLIN: All right, Joe Johns, thank you so much. The president is really hitting the road for his folks. To give us some context and explain why the president is hitting the road, let's bring in Kai Ryssdal.

You might know him as the host of the American Public Media program "Marketplace." Kai, we know you're out in Aspen, at the Aspen Ideas Festival. Talk to us a little bit about the economy.

You know, not so long ago, we were hearing all about the economic recovery and green shoot springing up. Now all this bad news had those green shoots withered? What are you hearing from folks?

KAI RYSSDAL, HOST, AMERICAN PUBLIC MEDIA'S "MARKETPLACE": Well, I tell you what, I don't think Ben Bernanke, Jessica, is actually talking about green shoots anymore.

There is a slowdown in the economic recovery. We had one. The jobs market was coming back. Companies were starting to spend. People, consumers were beginning to open their wallets. There is some pent-up demand.

But the conversation out here at Aspen and I think what the president is going to hear out on the road is people are a little scared now. You know, I mean, we lost those jobs in the Friday unemployment report.

Unemployment rate is still at 9.5 percent. The green shoots are -- if they're not withering, they're certainly not growing as fast as they used to and that's the message the president's working on.

YELLIN: In fact, it's not just that we're hearing from the president, also, Secretary Geithner was on the PBS "Newshour" yesterday. Listen for a moment to what he had to say.

(BEGIN VIDEO CLIP)

TIMOTHY GEITHNER, SECRETARY OF THE TREASURY: The economy is healing. It's getting stronger. I'm very confident we're going to continue to grow and continue to make progress, but, you know, no recoveries are even and steady.

(END VIDEO CLIP)

YELLIN: So, Kai, why are things going south?

RYSSDAL: Well, there's a couple of things at play here. First of all is consumer confidence. Things were going well. People were starting to spend again. As you've probably said on this program a couple of times, consumer spending is a huge portion of the American economy, maybe 70 percent of the American economy.

If consumers start pulling back from what they had been doing, then that's a problem. Secretary Geithner is right. I mean, the economy is healing, but it is healing more slowly. The other thing that's going on, that you really have to keep in mind, are corporations because that's where all the growth is going to come from.

The president has had his chance at economic stimulus. He had it last February and March, $787 billion worth and that's all coming out into the economy now. But he's got to wait for the companies to start spending their money. That's the catch. They've got $2 trillion they're sitting on. When they start really spending, then it's going to turn around.

YELLIN: You know, when you're not out in Aspen talking to the intellectuals and the fancy people, you talk to regular folks as part of your day job.

RYSSDAL: Yes, like I get to do all the time.

YELLIN: I'm curious, what is it that they want to hear from the president? Or is there anything the president can say to make folks feel better right now?

RYSSDAL: I think the president's along for the ride, just like the rest of us. He had his chance with the stimulus program back in February and March. Frankly, a lot of what's going to help the economy now is going to come from congress.

What businesses want to see before they start spending that $1.8 trillion, is they want to see consistency, they want to see smooth regulatory efforts. They want to see financial reform get passed and know what's in there.

They maybe want to see an energy bill and figure out what's in it for them there. I think American consumers and the everyman that I talk every now and then, and that you talk to as well, they just want to know that the president's there, and they're watching him to see what he can do from that bully pulpit he has. But the real change is going to have to come from companies and corporations with all the money.

YELLIN: And you are there I imagined with all these intellectuals at the Aspen Institute. What do you hear from them? What are their top concerns about the economy?

RYSSDAL: There are really two things going on out here. There was a great panel the other day, the beginning panel of the conference on the financial crisis and really what that financial crisis has done to our long-term economic standing.

What the debt and the deficit are doing to us. There's a short- term debt that maybe isn't so bad. There's a much longer-term debt with Social Security obligations and Medicare, and longer structural problems in the economy.

People are really talking about that and the other thing is, and this is a little bit trite, but it's the plight of the middle class. What happens to the middle class when the economy lingers for so long?

When 8.3 million jobs that we lost in the recession aren't coming back? What kinds of jobs will be back? Where are people going to get the money? Where is that confidence going to come from to grow the economy?

YELLIN: The disappearing middle class. All right, Kai Ryssdal, thanks so much for joining us, from Aspen. Appreciate it.

RYSSDAL: You bet, my pleasure.

YELLIN: And the president is trying to help Democrats in Missouri and Nevada this week, but next his own coalition may be coming apart.

(COMMERCIAL BREAK)

YELLIN: Tomorrow, President Obama hits the campaign trail for Democratic candidates in Missouri and Nevada, but some new poll numbers say he ought to be looking out for himself.

According to the CNN Opinion Research Corporation poll, the president's approval rating among liberal voters, Liberals, has dropped to 73 percent, down from 89 percent last year still high but a big drop. Now, a Gallup poll has his approval numbers even worst among independents, 38 percent, compared to 66 percent last year.

So, is there trouble brewing in the Obama coalition? Let's talk it over with Florida Democratic Congressman Alan Grayson, actor and activist Esai Morales, and CNN contributor, John Avlon.

Gentlemen, thanks for being with us and Congressman Grayson I'd like to start with you. Sir, your state went for President Obama in 2008 not just because of Democrats, but overwhelming with the help of independence. Right now, you're home with your constituents. What are you hearing from them about the president?

REPRESENTATIVE ALAN GRAYSON, (D) FINANCIAL SERVICES COMMITTEE: Well, I think they want the president to do more and they're afraid of what the Republicans might do with them. They don't want to go back to $4 a gallon gasoline.

They don't want more endless words that they don't want the economy brought to the brink of national bankruptcy as there was on the Republicans. They want the president to do more to solve the everyday problems that they face.

YELLIN: Esai, you hear the dissatisfaction the congressman is expressing. You became an Independent, but you voted for the president in 2008. What made you leave the Democratic Party and become Independent?

ESAI MORALES, ACTOR: Well, unfortunately, I think institutions become, you know, more interested in their own welfare than in the people they're supposed to represent.

I find the Republicans and the Democrats are two sides of the same coin sometimes. The American corporate business party and they, you know, corporations, large ones, contribute to both sides, they hedge their bets.

So they buy one side off, I think more, whoever will do business their way, but then they also contribute to other folks and threaten to pull that money out and I just didn't want to be a part of that anymore. I saw too much of our Democrats not really standing u and fighting for the people that they're supposed to represent --

YELLIN: You sound disillusioned --

MORALES: I have to say I'm a big fan of Alan Grayson's.

YELLIN: You really sound disillusioned with the whole party? Do you blame Obama for some of this? Do you think he's guilty for some of what you're saying?

MORALES: Here's the thing. It's hard for me to blame anyone president, whether it's Obama or Bush. The policy is kind of stays the same. So to me it seems like whoever gets you to the office is who calls the shots.

Whoever pays that money, whoever makes your donors, you know, show up, those are the people that you have to play ball with. Unfortunately, a lot of the things you say to get elected are different than the things you do to stay in office.

YELLIN: OK, John, I'm going to put this to you because you are our resident expert on Independence. Again, the support among Independents has plummeted for President Obama from 56 percent to 38 percent. What one factor do you attribute that to?

JOHN AVLON, CNN CONTRIBUTOR: The number one issue for Independent voters right now according to a recent poll is the debt, the federal debt. The second issue is terrorism then health insurance costs then unemployment.

So the debt, it's a mess we're hearing over and over is the spending. That's what's hurting this administration. There are different elements of the Obama coalition. He won independent voters by 8 percent in 2008, but that plummeting, a nearly 20 percent drop over the last year, that is not a subtle sign.

It's a sign Democrats are in trouble all over the country as well. Recent poll coming out showing they're down 12 points in matchups against Republicans looking into the fall so this is a real issue.

YELLIN: John, let me --

GRAYSON: Can I jump in here, Jessica?

YELLIN: Go ahead, yes.

GRAYSON: OK, first, with regard to the matchups, the matchups have been dead even for a year. Second, with regard to the Gallup poll report, you're comparing a blip up to 56 percent a year ago to a blip down right now to 38 percent.

When, in fact, the president's numbers have been extremely even among Independent voters for a year and a half now, between 40 percent and 50 percent. Sampling causes sampling error. That's what you're seeing right now. It's not as if the president's standing --

YELLIN: This swing is a sampling error, sir?

GRAYSON: Well, listen to what I said -- the president's approval rating among independents has been between 40 percent and 50 percent, very steadily now for a year and a half.

You had a blip up a year ago temporarily for a week. Now you're having a blip down through sampling error, temporarily, for another week, and you're making that into some kind of national story.

The national story ought to be the president has steady support among Independents, between 40 percent and 50 percent, and that hasn't changed for a year and a half.

YELLIN: John, you're shaking your head.

AVLON: I just think the overall trend is very clear. There is a decline not only among the president but among Democrats. Look, NPR poll came out last week showing that in the 60 most competitive districts in the country currently held by Democrats. Yours being one of them that currently Independent voters are swinging towards Republicans by 50 percent to 29 percent. That's not a subtle message. It's there. You can't just deny it.

GRAYSON: My district - by 14.

AVLON: Your specific district, maybe the case, but in aggregate, there's bad news for Democrats when it comes to Independent voters turning away.

GRAYSON: That's not true. It's not what the polls are showing.

YELLIN: Esai Morales, I want to give you a chance, what are you thinking? You're shaking your head.

MORALES: You know, it's hard to say what the poll numbers are. I come from Hollywood where, you know, studios can actually manipulate the results of movies being tested.

So, you know, what I noticed is that when you offer people hope and change and you don't give it at a timely basis, you're going to have some erosion of your especially liberal base. Here's the thing, why are we spending trillions and trillions on wars?

Why are we doing that? And cutting social services making the social safety net at home very, very tentative? You know, we really -- we're watching the biggest movement of wealth I think in our nation's history. And it's not going towards the middle class.

And I applaud Democrats, like Grayson, for standing up at least and going toe-to-toe with a lot of what I think psy-ops. Psychological operations. Making people feel like, you know what, he's a lost cause.

YELLIN: All right and you've expressed what we've heard in so many progressives who those who are disappointed with the president. We'll talk about that more on the other side of the break. All these men will be back with us.

And on the other side of the break, we are also going to ask if the Tea Party is turning into a hotter brand than President Obama's yes we can.

(COMMERCIAL BREAK)

YELLIN: The Obama brand seems a little tarnished these days. Back to talk about the fracturing Obama coalition, Florida Democratic Congressman Alan Grayson, actor and activist, Esai Morales and CNN contributor John Avlon.

Congressman, once upon a time, everything on Madison Avenue, about a year ago, everyone on Madison Avenue wanted to use Obama's brand to sell. But now take a look at this new Dodge ad and how much has changed.

(BEGIN VIDEO CLIP) UNIDENTIFIED MALE: Here's a couple of things America got right, cars and freedom.

(END VIDEO CLIP)

YELLIN: Looks like they're selling independence, maybe even the Tea Party czar is don't tread on me the new yes we can of 2010?

GRAYSON: I don't see it that way. The Tea Party is simply a rebranding of the Republican right wing. Certainly when it comes to patriotism, Democrats have nothing to apologize for. Look at my tie.

YELLIN: A picture's worth a thousand words? John Avlon, I've covered the Tea Party. It's not just the Republican right wing consider a portion of it is. But there are also many independents in there and disaffected former conservatives. Will there be an independent party? Will there be a third party?

AVLON: Well, you are seeing - remember, Independent voters are the largest and fastest growing segment of the electorate and their record numbers right now in reaction to the polarization of the two parties.

What you're seeing with the Tea Party Movement, I think it's best to understood as a conservative populous protest movement. They actually think the party should be more polarized.

Yes, you've Libertarians and you've got disaffected Conservatives in that group. But I think if you look the mainstream movement, behind it's the better voters. It's overwhelmingly a rejection of the two parties because they are more polarized than any time in our recent history.

YELLIN: Esai, you left the Democratic Party so would you like to see a third party? Would you vote for a Democrat in November?

MORALES: Only a viable one. I mean, the fact of the matter is, I will still go back to Democrats if they represent policies and platforms that I identify with. The fact of the matter is, we're split up artificially.

You know, nobody is completely Liberal or completely Conservative. I think that's a clever way to keep populations divided and conquered. The fact of the matter is, we need to get back to what it is to be an American.

I believe in independence. I believe in many libertarian aspects of the Tea Party Movement, but then I think it does get taken over by the fringe elements that completely make it almost a joke, a farce, when they go after certain things that I just -- I can't listen to any more.

But they're on to something and I've got to figure out or we all have to figure out how to get the divisiveness of this country out of here. I mean, I don't want to fight Republicans. I don't want to fight Democrats. I want to really keep what we have -- this great legacy, here and grow it and make it something worth -- make this nation somewhere worthwhile living in.

YELLIN: Congressman, one of the reasons there's so much energy in the Tea Party Movement is there's a lot of passion behind it. There's a lot of at the same time frustration growing, it seems, within parts of the Democratic coalition.

Nancy Pelosi, the speaker of the House herself, came out and drew a line on Afghanistan saying that if the president -- she basically voted for an amendment requiring a new intelligence review of Afghanistan and the plan for redeploying U.S. troops with a time line. So are we seeing a fracturing of support in your party?

GRAYSON: No, there's nothing like what you see in the Tea Party. I said a year ago that I thought looking forward you would see that the Tea Partiers would no longer obey their corporate masters in the Republican Party and that's exactly what's happened.

That's exactly what you're seeing. They can't stand the corruption of the Republican Party. They can't stand the fact that last week the head of the Republican Party in the House said that he wants to raise the retirement age and means test, Social Security so that we can pay for these endless wars.

That's not anything any rational person wants to do, but that's the official policy of the Republican Party right now. They're the ones who are fractured, not the Democrats. The Democrats simply want to help people in need.

YELLIN: All right, well, Congressman, roll call on the topic of the tea party, roll call has been reporting that a pollster who worked for you is running for the Florida statehouse as a Tea Party candidate. It's raised Republican suspicions you're using the Tea Party to split the GOP vote and help yourself. Would you care to comment on these allegations?

GRAYSON: Well, you misstated the allegation. The allegation is that someone we used to poll Republicans last year went ahead and declared her candidacy for a statehouse position and is not running against me. So you need to get your facts straight.

YELLIN: And do you have any comment on the overall accusation?

GRAYSON: An overall accusation that's false?

YELLIN: So that's your response, it's false, flat out --

GRAYSON: What you just said is certainly not the case. What else do you want me to respond to, do you want me to respond what someone else said?

YELLIN: I want you to respond to the accusation that you are in some way allowing -- supporting a Tea Party effort to help fracture the vote.

GRAYSON: Well, yes, I mean, you know, in the same way that Al Gore invented the internet, I invented the Tea Party. Isn't that well known? I mean, Sarah Palin is a puppet. She does whatever I tell her to do.

YELLIN: All right. Thank you, Congressman --

MORALES: -- our plant -- isn't Alvin Green in South Carolina supposed to do the same thing against Democrats?

YELLIN: That is a matter that is still being investigated. But I appreciate all you three joining us. It's a lively conversation and hope to have it again. Thanks so much.

And coming up next, the rest of the show, Arianna Huffington join us for her move your money campaign. What's that all about?

Lebron James' agent. He's today's most important person you don't know. Where will James go?

And in the play by play, one tough nerd. What is that? And a different angle the website war in the Nevada Senate race. Stay tuned for all of it.

(COMMERCIAL BREAK)

WILLIS: Arianna Huffington already runs one of the most popular political blogs around and now she's taking on Wall Street reform her way. It's called "Move Your Money" and it's a way ordinary people can flex their political muscle with Wall Street by switching from a behemoth national/international bank to a local financial institution.

She joins us now from Aspen, Colorado where you're attending the Aspen Ideas Festival. Arianna, thanks for joining us and tell use, why did you decide to do this? What's the goal of "Move Your Money"?

ARIANNA HUFFINGTON, EDITOR IN CHIEF, THE HUFFINGTON POST: Thank you, Jessica. The goal is really to give people an opportunity to do something themselves, without waiting for government to act.

We've been waiting for government to end too big to fail banks. It's not going to happen, even with a new financial regulation bill. So here's an opportunity for people to just move their money from the big banks into community banks, credit unions.

As you know, deposits up to $250,000 are guaranteed so there's no risk. And that way they're able to support institutions, which are supporting their communities, which are more likely to lend so small businesses can create jobs.

Which are more likely not to impose these huge fees that many of the big banks are imposing and it's working. Already about $5 billion has been moved, which may not sound like a lot of money for the big banks that they're used to huge bail out, but it's a lot of money for the local community banks and credit unions.

YELLIN: That is a lot of money. I wonder what's in it for the average American? If I'm an individual and I decide to take my money out of a big bank, am I potentially putting myself at more risk with a bank that could go under in this environment? HUFFINGTON: No, not at all. Because as I said, up to $250,000, it's insured. And the truth is that when you move to a bank that is much more likely to be working for you, in your interests, and not be imposing all these hidden fees that so many banks are imposing, you're both supporting yourself and your family, and you're also supporting your community. We saw the big banks getting billions of dollars in bailouts and cutting lending. The four big banks cut lending by $100 billion already, even though -- remember, we told you in the bailout that one of the reasons to bail them out was so they could lend and create jobs.

YELLIN: Realistically, how can moving this amount of money ever really make a difference? $5 billion sounds like a lot, but compared to the trillions of dollars that move through the system, does it matter to the banks?

HUFFINGTON: Well, first of all, it matters to the individuals. We had amazing e-mails and comments on the Huffington Post site from people who feel empowered just because they feel they can do something. The worst thing, as you know, Jessica, is for people who are losing their jobs, losing their homes, to move into a deep depression about their lives and about their future. And that small act of moving their money shows that it's something that they can do. On top of it, this is just the beginning.

We now see pressure being put on state political parties to move their money, pressure being put by student organizations to college endowment funds to move their money. Already Massachusetts and New Mexico have introduced legislation to move estate money. So, it's just the beginning, and it shows how much can be done, when people organize spontaneously around the country.

YELLIN: Have you moved your money? Have the investors in Huffington Post move their money?

HUFFINGTON: Well, the Huffington Post and I personally never had our money in a big bank.

YELLIN: Never?

HUFFINGTON: But a lot of our friends have moved -- no, I just happened to be banking with a bank that is not one of the big banks. But a lot of our friends and bloggers have moved their money. And a lot of elected officials, including Congresswoman Jan Schakowsky, for example, who blogged about it. Bill Mobb (ph) blogged about ending your addiction and ending your abusive relationship with your big bank and moving to a healthy relationship with a community bank. Remember, "It's a Wonderful life." It's about Mr. Bailey and Mr. Potter.

YELLIN: We all want healthy relationships. But in the big picture, this is about, in some ways, getting back at Wall Street. And if we're honest about it, doesn't hurting Wall Street hurt us too? Our 401(k)s are invested in it, our pensions are invested in it. Wall Street is a driver of economic growth. Do we really want to attack Wall Street? HUFFINGTON: No, it's not actually about revenge. It's more about making sure that families understand what is in their interest. We need great financial literacy. We need to understand what is at stake with our credit cards, with our accounts, and we need to also recognize that we have tremendous power. A lot of our pensions, a lot of our money, is invested in institutions that have the power to influence the behavior of big banks. I'm hoping that big banks will actually become more competitive and encourage customers to stay with them. This is really about the best thing in America. Good healthy competition.

YELLIN: And finally, you're at the Aspen Ideas Festival. I'm curious what you're hearing there about Obama, about economic concerns. What's the hot talk there?

HUFFINGTON: Well, actually, what we said about the belief that change is going to come from around the country and not from Washington is the consensus here. Whether you talk to conservatives or to liberals, there is an incredible conviction that Washington and the political system in Washington is broken. And real change is not going to come from there. There is real concern about jobs, about the fact that so many kids are graduating from college and can't get a job, about the fact that the administration seems to be impotent to do anything about it. The fact that we are on day 36 of not even being able to extend unemployment benefits.

YELLIN: All right. Arianna, thank you so much for joining us, Arianna Huffington from Aspen, Colorado, with a very innovative way to vote with your money, and we should add that we reached out to a number of Wall Street professionals and big banks to ask for their statements and comments. All of them declined to join us or to provide a statement.

And coming up, today's most important person you don't know could be a lot wealthier tomorrow. It all depends on a basketball superstar's division.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

TOM CRUISE, ACTOR: Show you the money.

CUBA GOODING, JR., ACTOR: That's not so good. Show me the money.

CRUISE: Show me the money.

GOODING: Yes. Louder.

CRUISE: Show me the money.

(END VIDEO CLIP)

YELLIN: We can't play that video enough. Today's most important person you don't know will have a big day tomorrow. Leon Rose isn't exactly a politician. He's the agent for Cleveland Cavaliers superstar Lebron James. Rose has been in on the negotiations over which team James, who is a two-time league MVP and, now, a free agent, will be playing for next year. The big announcement happens tomorrow. Rose heads the basketball division of CAA, Creative Artists Agency.

He's a New Jersey attorney, played basketball at Dickinson College, mostly as a reserve, and he hits a big time in the business end of the game. Here's why we're doing him on a political show. Some politicians you might recognize would gladly jump through hoops if Rose could only get Lebron on their team.

(BEGIN VIDEO CLIP)

ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: I think the president still believes that he would look quite good in a Bulls uniform.

MAYOR MICHAEL BLOOMBERG (I) NEW YORK: Come on, Lebron.

UNIDENTIFIED FEMALE: What's wrong with you girls? He's the best basketball player on the planet.

UNIDENTIFIED FEMALE: Lebron, please stay.

UNIDENTIFIED FEMALE: I'll make it worth your while.

(END VIDEO CLIP)

YELLIN: That was just gratuitous. What is worth this afternoon, the Phoenix Suns, Jared Dudley, tweeted this, quote, "breaking news, my sources tell me Lebron will announce that he will be going to the New York Knicks tomorrow on ESPN. This is serious." Wow. All right. Well, I don't know. I think politics, the only way it would get rougher is if agents were with it -- if were in politics. And joining me now to talk about all the day's news, Republican strategist, Adolfo Franco, Democratic strategist, Maria Cardona, and in New York, I'm joined by Amy Goodman, host of "Democracy Now!." Thanks to all of you for being with us.

Let's take a look at some of the stories that are on my radar. First of all, Arizona governor, Jan Brewer, she may be turning into the hottest Republican endorsement this side of Sarah Palin. She is backing governor's candidates in Oklahoma and Georgia, but her clout stops at the border. "The New York Times" reports the governors of six Mexican states told brewer they are boycotting a border governor's conference because it's in phoenix. So, Brewer cancelled the meeting. Now, Mexico's Democratic governor, Bill Richardson, says he will look for alternative sites. All right. So, is Jan Brewer the hottest new Republican star out there?

MARIA CARDONA, DEMOCRATIC STRATEGIST: Well, she is certainly a big draw for the extreme right wing. So, as far as you can say that Republicans want extreme right wing candidates, then absolutely, as the Democrat, I say go for it. I think the problem here, though, in terms of this law and what this demonstrates is that this is not only a travesty in terms of its unconstitutionality, but it has been a huge economic drain for Arizona. Hundreds of millions of dollars are being diverted to other states because of this law.

ADOLFO FRANCO, REPUBLICAN STRATEGIST: The big dream for Arizona and, of course, our border states is the flow of illegal immigrants into our country that are causing all kinds of havoc, crime, also 10 percent unemployment with this administration. Arizona has the highest percentage of illegal immigrants in the United States. This is Arizona's cry for help. Absolutely, Jessica, she's the hottest (INAUDIBLE) around. You mentioned these border states from Mexico, those people don't vote in the U.S. You know, there's an interesting statistic today, 56 percent of Hispanics in Colorado support the Arizona law.

So, it's a myth that there's a problem with the Hispanic community. The American people know and all the polling data -- my friend Maria knows this, all the polling data indicate the American people not just the Arizona support this law.

YELLIN: Let's move to the next item today because I don't want to miss this. John McCain is our hot topic. He will not vote for Supreme Court nominee, Elena Kagan. Amy Goodman, listen to this, in a "USA Today" op-ed, he explains, quote, "I cannot support her nomination to the Supreme Court where based on her prior actions it appears unlikely that she would exercise judicial restraint." Funny. That's not what McCain said about Sonia Sotomayor last year when he wasn't facing a Republican challenger in a tough primary. Listen. Do you remember this?

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN, (R) ARIZONA: We sometimes forget elections have consequences. She would not have been my nominee most likely but the fact is that the president, when he has the obligation and duty and privilege to nominate.

(END VIDEO CLIP)

YELLIN: All right. So, he did vote no on Sotomayor, but his position was that this is the president's choice. Amy, is this a fella who's changing a lot of his stripes as he's running for office or what do you think happen with John McCain?

AMY GOODMAN, HOST, "DEMOCRACY NOW!": He certainly is, and it astounds me on the issue that Elena Kagan has been criticized for, saying that she's anti-military, for simply saying that the military should include gays and lesbians. It's interesting to me because John McCain's wife, Cindy McCain, has come out supporting gay marriage. But this issue is one that's been completely misinterpreted because, basically, Elena Kagan isn't against the military. She's for expanding the military to include everyone.

YELLIN: But isn't this exactly why you have judicial confirmation process, people can vote no?

FRANCO: That's the point here. There a couple of things that need to be clarified. I think that statement is completely consistent. He said the president has a right to nominate anyone. As you just mentioned, Jessica, he voted against Sonia Sotomayor as well. So, he said the consequence of the election is the ability of the president of the United States to nominate people, and eventually, I think, she'll be confirmed, getting them on the Supreme Court. That's the consequence. It's nothing to do with his position. He never said he would vote for any nominee.

YELLIN: He did vote yes on Clinton's two nominees.

FRANCO: Yes, but he voted against Sonia Sotomayor on it, very clearly on it. And let me tell you this, this gay Americans issue, I don't think is the issue at all. I mean, gay Americans should not be the issue. They should serve in the military. This policy of don't ask, don't tell is absolutely wrong. I think he's looking at other issues beyond that. He's looking at her traditional philosophy as other --

CARDONA: This is clearly continuation of two-faced John McCain in all his glory. He did vote (INAUDIBLE) Sotomayor and that was the beginning of his flip-flopping on every single principle he based his political career on just to get the Republican nomination.

YELLIN: OK. For the record, Barack Obama, current president, voted no on John Roberts when it was a Bush nominee. Moving on, because you'll want to listen to this story. Remember Alvin Green? He's the unknown unemployed army veteran who's now South Carolina's Democratic Senate candidate? Well, we know very little about him, but we know now a little about his plan to stimulate the economy.

He said, this is a quote, "another thing we can do for jobs is make toys of me, especially for the holidays, me in an army uniform, air force uniform, and me in my suit." That's something that would create jobs. So, you see, I think out of the box like that. It's not something a typical person would bring up. That's something that could happen. That makes sense. It's not a joke." OK, Amy, I, I --

GOODMAN: Well, Jessica I just say, the one thing he got right--

YELLIN: -- Speechless --

GOODMAN: Is that green jobs would improve the economy. We got to green the grid. We got to start talking about alternative energy. In that way, I think we don't have to joke about that. That's absolutely --

FRANCO: If the free enterprise system is in charge and not the government through cap and trade, I'm all for that.

CARDONA: This is clearly one of most bizarre political stories out there, but it clearly makes the interesting. And you, guys, love this stuff, don't you?

YELLIN: We need a laugh. I mean, we can't get enough, right? A little bit of fun in politics is --

CARDONA: Plus, I think he's actually saying what every politician secretly want, action figures of themselves. FRANCO: We'll see how he fares in November.

YELLIN: All right. We'll come back with all of you on the other side of the break.

And coming up, you won't believe what one gubernatorial candidate is calling himself.

Plus, we'll look at tomorrow's headlines tonight.

(COMMERCIAL BREAK)

YELLIN: If you're just joining us, here's what you need to know right now --

All ten suspects in the alleged Russian spy ring are scheduled for arraignment in a New York courtroom tomorrow. Tonight, there's speculation of possible spy swap with Russia may be in the works.

President Obama heads to Missouri and Nevada tomorrow to help Democrats in two crucial Senate races.

ANNOUNCER: Here comes the "Play-by-Play."

YELLIN: And now it's time for the "Play-by-Play." Just like in sports shows, we replay the tape and break it all down, only it's about politics. Back with me are Republican strategist, Adolfo Franco and Democratic strategist, Maria Cardona. All right. We've heard Sharron Angle. She's the Tea Party it girl. She won the Republican senate primary in Nevada. She's taken down her old campaign website and launched a new one. But supporters of her opponent Senator Harry Reid, they reposted the old website calling it the real Sharron Angle.

That's because the new web site is a little different. She's furious, she's threatening to sue, and not only do the old and new sites look different, missing from her new one are her ideas -- some of which have been criticized, like getting rid of the Department of Education and phasing out social security. You say?

CARDONA: This goes back to my point that I made the last segment which is the Republican party really -- they have an issue with these right wing extreme candidates, tea party candidates, who don't represent the mainstream of America. This is a clear example that even her supporters and her campaign understand that or else they wouldn't have changed her website.

YELLIN: It appears she scrubbed her website of the more --

CARDONA: Absolutely, she did.

FRANCO: She did this, not her supporters. This is --

YELLIN: Oh, she got a complete makeover --

FRANCO: But you know, this is a good example --

CARDONA: It's not going to not work --

FRANCO: This is a good example of dirty tricks in terms of what the Democrats are up to putting up the site --

(CROSSTALK)

FRANCO: Those are her positions --

CARDONA: In public --

YELLIN: And now, she's deleted some of that.

FRANCO: Well, she's involved in some of these issues. She's running a statewide campaign. I think she's a serious candidate. She came on to this out of nowhere, like an asteroid. I think she's an extraordinarily appealing candidate. And now, she's going to be fighting a conventional candidate on these issues. I think it's a much more articulate. I look at it. Much more professionally done. And I think well-positioned website in terms of trying to contacts (ph) with Harry Reid's very liberal agenda.

CARDONA: She is appealing to the extreme right wing.

YELLIN: OK. We'll see where that one goes. Moving on, Roy Blunt, he's from Missouri, and he is one of the House Republican leaders. Brad Ellsworth, he is a Democratic congressman from Nevada. But the two things have something in common. Check out their campaign ads.

(BEGIN VIDEO CLIP)

REP. BRAD ELLSWORTH, (D) NEVADA: 25 years as a sheriff teaches you is zero tolerance for both (ph). There's too much at stake. But out in Washington, it's like they live and breathe this stuff. They waste our money. They take care of special interests. And they don't care if lobbyists write the laws or if our jobs get shipped overseas.

REP. ROY BLUNT, (R) MISSOURI: My mom and dad were dairy farmers. My grandmothers were one room school teachers. I was the first person in my family to graduate from college. I became a high school teacher and later a university president. I was taught there is nothing you couldn't achieve through education and hard work.

(END VIDEO CLIP)

YELLIN: All right. Both of those men have been longtime incumbents. Neither of their ads mentions that they're a congressman currently serving. I mean, is it startling? They don't even want to mention their bio, the anti-incumbent ad is so intense.

FRANCO: It's the year we're living in. And I think we all agree with it. It's an anti-incumbency feeling in the country. People are very, very angry about high unemployment. Most Americans think the country's going in the wrong direction. I think people want to stress that they've had a different life. Yes, they've had a significant amount of time in Congress, but they've had a significant also experience in business and other opportunities. And that's what's going to resonate with the voters.

YELLIN: Is this an overreaction? I mean, if these gentlemen mentioned that they've served their community by being in Congress, would that be a real problem?

CARDONA: I don't think it's an overreaction. I do think that they are speaking to the concerns of that anti-incumbent move. Probably their own concerns more than the voters. I think what they're doing, smartly, is not necessarily denying their Washington experience, they're making that connection, that personal connection, with the voters that I think they need to do before they talk about anything else.

FRANCO: I think that's right.

YELLIN: OK. We're going to move on because we've heard political candidates touting their military records and their business success, but listen to this, being a nerd? This is from Michigan Republican gubernatorial hopeful, Rick Snyder.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: To get back to work, Michigan needs Rick Snyder.

UNIDENTIFIED MALE: It's time for a nerd.

UNIDENTIFIED MALE: Growing up in Battle Creek, Rick Snyder started reading "Fortune" magazine when he was 8. By 23, he completed college at the University of Michigan and his MBA and his law degree. Rick Snyder is a very bright entrepreneur who happens to adore Michigan.

(END VIDEO CLIP)

YELLIN: Quick thoughts I'm almost out of time.

FRANCO: I think it's a great ad. I think most Americans, people in Michigan, can identify with it. I think it's absolutely refreshing.

CARDONA: I think it's catchy. My understanding, though, is that he is way too moderate to win the Republican nomination.

YELLIN: Even as a nerd?

CARDONA: Even as a nerd.

YELLIN: All right. Thanks to both of you for joining us. I'm grateful.

CARDONA: Thanks, Jessica.

Is suing someone as American as apple pie? "Pete on the Street" finds out, next.

(COMMERCIAL BREAK)

YELLIN: Campbell Brown joins us now for a look at what's coming up tonight in her program. Hey, Campbell.

CAMPBELL BROWN, CNN ANCHOR: Hey there, Jessica. Louisiana senator, Mary Landrieu, says Louisiana will need up to $1 billion a year to restore the Gulf Coast. Will that state get the money they need?

Also tonight, we're going to talk to Dr. Sanjay Gupta about the psychological and emotional effects that the spill is having on a lot of people in the Gulf.

And then later, the story that's stopping parents dead in their tracks or people with kids actually not as happy as those without kids? There is some very interesting new research. All of that and a whole lot more at the top of the hour -- Jessica.

YELLIN: The federal government is suing Arizona. Are lawsuits now as American as apple pie? We sent our offbeat reporter, Pete Dominick to find out. Hey, Pete.

PETE DOMINICK, JOHN KING, USA OFFBEAT REPORTER: That's right, Jessica Yellin. Yes. I think, unfortunately, they are. I went out there ask people what they thought. Here you go.

(BEGIN VIDEOTAPE)

DOMINICK: Who are you, guys, suing?

UNIDENTIFIED FEMALE: We're not suing anybody.

DOMINICK: You're not suing anybody?

UNIDENTIFIED FEMALE: That's what I know.

DOMINICK: Why do you hate America? How un-American of you for not filing a lawsuit?

Who are you suing?

UNIDENTIFIED MALE: The train (ph).

DOMINICK: Yes. Why?

UNIDENTIFIED MALE: Because they almost ran me (EXPLETIVE WORD) over.

DOMINICK: Never file a lawsuit because somebody didn't share their recess pieces?

Uh-huh, we're on to it. I'm going to sue my cameraman, Ken, because he didn't wire me probably having kicking (ph) in shock.

Do you guys have a lot of lawsuits in Canada you file against each other? UNIDENTIFIED MALE: No, we don't.

DOMINICK: If your maple syrup tree is on the border of my property and I tap it and steal your syrup, you can't sue me?

UNIDENTIFIED MALE: We'll work it out.

DOMINICK: Let's say you took a swim in my Canadian pool and you broke your leg and get Band-Aids.

UNIDENTIFIED MALE: We have health care, so it is no lawsuit.

DOMINICK: Oh, that hurt (ph), sir.

Oh, you're suing Ed Rollins

UNIDENTIFIED MALE: Right. Right.

DOMINICK: Because he's trying to try to look like you.

UNIDENTIFIED MALE: Right, exactly.

DOMINICK: Oh, I'm suing you. I'll see you in court buddy.

You said the one and only me. What if there was someone else like you, would you sue them?

UNIDENTIFIED FEMALE: No.

DOMINICK: I'm suing your baby for being too cute. You're too cute. I'm suing you. I'll see you in court.

Larry King is going to sue you.

UNIDENTIFIED MALE: Is he?

DOMINICK: Yes. Because he's the only one allowed to wear suspenders on CNN.

UNIDENTIFIED MALE: I'll see you in court, Larry.

DOMINICK: Do you want to settle? If you want to settle, would you take them off?

UNIDENTIFIED MALE: I'll sue you if you touch me.

(END VIDEOTAPE)

YELLIN: All right. Pete, thanks so much. Next time, we'll have our lawyers contact you. That's all from us tonight. Campbell Brown starts right now.