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Unemployment Benefits; Tea Party Civil War; Top Secret America

Aired July 19, 2010 - 19:00   ET


JOHN KING, HOST: Thanks, Wolf. And good evening everyone. Driving today in politics a high-stakes showdown that speaks volume about the dividing line in this midterm election year, it is a test of what you rank higher. Compassion for those hit hardest by the recession or frustration that Washington keeps spending billions it doesn't have. President Obama framed the fight in an event in the Rose Garden today flanked by three everyday Americans he says deserve extended unemployment benefits but are being denied help because of Republican opposition.


BARACK OBAMA (D-IL), PRESIDENT OF THE UNITED STATES: The same people who didn't have any problems spending hundreds of billions of dollars on tax breaks for the wealthiest of Americans are now saying we shouldn't offer relief to middle class Americans like Jim or Leslie or Denise who really need help.


KING: Here's a little secret. The president knew when he waked into the Rose Garden that he already has the votes to pass the emergency benefits package. Maine's two Republican senators have told the Democratic leadership they will vote yes this time. And the Senate is on track to pass this measure as early as Tuesday.

But even with victory assured the president wanted to draw a sharp political contrast. A decision Republicans called cynical and many Democrats called overdue. So how does the fight over unemployment benefits play into this year's larger fight over the economy?

Let's talk it over with our senior White House correspondent Ed Henry and with Amy Goodman, the host of the progressive Democracy Now!, radio and television program, CNN contributor Erick Erickson, editor-in-chief of the conservative, and with me here our senior political analyst Gloria Borger.

Ed, to that point the president did this for a reason. He knows he's going to win when the Senate cast this vote probably as early as tomorrow but increasingly he's under pressure from Democrats to get more scrappy and that was the point, wasn't it?

ED HENRY, CNN WHITE HOUSE CORRESPONDENT: There is no doubt, the Democrats on the Hill, we saw some of that fighting last week with House Democrats. They are saying look, we've cast all of these tough votes for the president's agenda and they don't see enough of him standing up for them, standing up for the Democratic agenda, and beating up on Republicans when you have a situation like this.

There have been three votes now in the Senate in recent weeks where Republicans have blocked an extension of this unemployment compensation. So the president is able to make a political point about that. And also hit the Republicans for the fact that they are saying, look, we'll support this if you pay for it and the president is saying look, you didn't pay for tax cuts in the Bush years.

You didn't pay for the wars in Iraq and Afghanistan. You didn't pay for domestic priorities like the prescription drug plan and so this is a great opportunity for this White House to do what they've been saying they will do, which is show a big contrast with the Republicans.

KING: And Erick to you first on this one, do conservatives and Republicans feel security in this argument because you do have nearly 10 percent unemployment in the country. There is an argument is to be made that as long as you can prove these people are out looking for work, not just sitting at home waiting for a check, why can't you help them if it's not their fault. I want you to listen before you answer to Mitch McConnell, the Senate Republican leader. He was on "STATE OF THE UNION" with Candy Crowley and to Ed's point he said look, if they find the spending to offset this, we will vote yes. If not, we'll vote no.


SEN. MITCH MCCONNELL (R-KY), MINORITY LEADER: (INAUDIBLE) if you can't pay for a program that everybody agrees we ought to extend, what are we going to pay for? If we can't pay for a program like extension of unemployment insurance that virtually every member of the Senate -- I think in fact every member of Senate wants to extend, then what are we going to pay for?


KING: Safe grounder?

ERICK ERICKSON, CNN CONTRIBUTOR: Oh, you know I think it's fantastic the Republicans have finally found some principles on spending to pay as you go. Their problem is that for a very long time, during the Bush administration they didn't do that. I do think, though, that they probably have a winning argument.

It's very tough when you have the president come out with people who are affected by it. The Democrats have done a very good job of putting a personal face on this issue. But right now most polls suggest that the American people lack faith in the Democrats, particularly on spending. And this does nothing but help the Republicans try to get past their old images spin drifts.

KING: Erick says that it helps the Republicans, Gloria, but the Democrats want to highlight these numbers -- I want to show them to our viewers. They say here's the price for extending these unemployment benefits, $35 billion or so. That's the price tag for extending unemployment benefits. The Republicans do say don't let the Bush tax cuts expire. Keep those tax cuts in place.

If did you that, it would most likely add to the deficit. That's $2.3 trillion. So on the one hand, don't spend $35.5 billion unless you offset it but $2.3 trillion in tax cuts is OK. Is that in this political year can Republicans sell that?

GLORIA BORGER, CNN SR. POLITICAL ANALYST: Well, look, it's a difficult argument. I would argue on both sides because I think they are both being disingenuous. I mean, we have a huge --


BORGER: I know. This will surprise you. We have a huge deficit problem out there, right? Now 56 percent of the American public believes Barack Obama is not dealing with it. This is what Republicans are capitalizing on. But even if you were to cut discretionary spending a little smidgen, it's only one-eighth of the budget, non-defense discretionary.

You have the big problem of entitlement programs, Social Security, Medicare. Nobody is out there yet. They've got a commission working on it but I don't hear Republicans and I don't hear Democrats saying, OK, we're serious about cutting this deficit. Let's see how we are going to do it. Instead, you know they are squabbling over this.


KING: Amy --


UNIDENTIFIED FEMALE: That may be true.

KING: On the left is this thank you, Mr. President, where have you been? Or are there concerns, as Gloria says, concerns about the deficit go across the ideological spectrum?

AMY GOODMAN, HOST, "DEMOCRACY NOW!": Well, I think there should be a new termed coin, it should be deficit doves. If we're really talking about cutting the deficit, let's end war. Let's end the wars in Iraq and Afghanistan that cost us the most. All through the day on CNN you've been doing this very important story from "The Washington Post", the investigative series on the run-away, out of control intelligent budget -- intelligence budget of tens of billions of dollars.

Who know where is that money is being spent? What private companies are being given this money? These are the kinds of issues that have to be addressed if we're really talking about dealing with the deficit. I don't think most Americans, and the polls show it, a "USA TODAY"/Gallup poll just came out most Americans feel that this recession, that this deficit should be born on the shoulders of those who can least afford it, and those are the unemployed of this country. KING: And as we get closer to Election Day, 106 days, now that seems like a long time, but it will be here before you know it.

UNIDENTIFIED FEMALE: But who is counting?

KING: But who is counting? But more and more people are asking because of the possibility that Republicans could take back control of the House, the Senate or conceivably both if they get a waive (ph) election. More and more, they are getting asked. You say balancing the budget is important. What would you do? You say the deficit is horrible. What would you do? I want you to listen to Pete Sessions -- he runs the House Republican Congressional Committee -- on "MEET THE PRESS" yesterday. He was asked a pretty simple question. What would you do?


REP. PETE SESSIONS (R), CHMN., NAT'L REPUBLICAN CONGRESSIONAL CMTE.: Balance the budget. We should live within our own means and we should read the bills and work with the American people.

UNIDENTIFIED MALE: How do you do it? Tell me how you do it. Name a painful choice the Republicans are prepared to say we ought to make.

SESSIONS: Well first of all, we need to make sure that as we look at all that we are spending in Washington, D.C., with not only the entitlement spending but also the bigger government, we cannot afford anymore. We have to empower the free enterprise system.


KING: Erick, if conservatives want control of the Congress, do they need to give a better more specific answer than that?

ERICKSON: Well I think they want control of Congress so they're not giving a more specific answer. You know, I long for the days when conservatives weren't afraid to say cut the Department of Education or the Department of Health and Human Services or combine them. They are not going to do that.

They're going to get beat up for it. They know it so they're going to be very general, give a lot of platitudes. That's what politicians do these days on both sides of the aisle. That's why Americans are so cynical about American politics --

KING: And yet, Ed, they have to know at the White House as much as they want to force those questions, what would the Republicans do? What would the Republicans do? That the tradition is a midterm election is a referendum on a president's first two years in office.

HENRY: There's no doubt about it and they can keep -- trying to show this contrast but at the end of the day, it would seem at this point that a lot of voters are going to be going into the booth voting on the performance of Barack Obama more on whether Pete Sessions -- more on that -- than whether Pete Sessions can answer the question on "MEET THE PRESS" about what spending programs he'll cut.

But to Gloria's point about both sides insisting they want to get this budget in a balance but neither side came come up with a solution. We've got Pete Sessions there not being able to point something out. On the Democratic side, look, you keep hearing the White House saying look the Republicans didn't pay for the wars, et cetera, but here now President Obama pouring more resources into Afghanistan. He thinks that's the right thing to do right now, but we're not paying for that either, so both sides have a deficit problem.

BORGER: You know John, very quickly, if the tea partiers get elected, there's going to be a real issue inside the Republican Party. Are they ever going to vote for a spending bill, number one, and are they going to vote for funding for any war? Lots of them, for example, opposed the war in Afghanistan, so this is going to be something Erick will be very happy about because the Republican Party is going to have to deal with this issue.

KING: You mentioned the Tea Party. Erick and Amy are going to stay with us -- our thanks to Ed and Gloria. When we come back what you might call a bit of a civil war in the tea party movement. Don't go anywhere.


KING: A civil war of sorts in the tea party movement after its big debate with the NAACP over whether there is racism in its ranks. The National Tea Party Federation, which considers itself a national umbrella group for the grassroots movement says it will no longer recognize the tea party express and its leader Mark Williams as members. That's because of a controversial blog posting in which Williams used language even many of his supporters complained was offensive, even racist. Williams insists it was satire and was unapologetic when I asked him Friday night if he had made a mistake.


MARK WILLIAMS, TEA PARTY EXPRESS SPOKESMAN: What I did was successful and I'm glad it was successful. I'm sorry I had to go to those lengths to slap some sense into a lot of people who are so afraid of politically incorrect language that we can't get a conversation started.


KING: His organization is scoffing at the Tea Party Federation's action saying it has many more members and followers. Quote, "Most rank and file tea party activists think we're talking about Star Trek when we try to explain who the Federation is", the Tea Party Express said in its dismissive statement.

But there is more evidence of fallout tonight. Conservative Democratic Congressman Walt Minnick of Idaho says he will not accept the Tea Party Express endorsement because of what he called the quote, "reprehensible blog post by Mark Williams". So how will this affect the Tea Party's role in the midterm campaigns? With us still Amy Goodman of the liberal "Democracy Now!" and Erick Erickson of the conservative and joining the conversation CNN senior correspondent Joe Johns and national political correspondent Jessica Yellin.

Erick, you have been aligned with this movement, encouraging this movement saying it brings fresh air. When things are new, people are new to the process, mistakes are made. Has Mr. Williams made a mistake here that has undermined the cause?

ERICKSON: You know he has and it certainly undermined the Tea Party Express -- to use the word that kids are using today, they need to refudiate him apparently. Get him out of there. You know it's a shame because you know I've said dumb things, everybody does.

But he's really gotten his back up and bunkered down and said that he's been successful. He's hurt the cause and he's hurt the movement. The Tea Party movement is not a bunch of racists. But what he did and what he said and that he doesn't get it is appalling to me. And maybe it's because I'm from the south and he's from the north but you don't use language like that in the south.

You shouldn't across the nation. It's offensive. And shame on the Tea Party Express for not distancing themselves from him because he has maligned an entire movement of goodwill people.

KING: Amy, is this a fight now an internal feud that liberals just look at with glee or is there potentially a next step that could bring some good of this, some conversation or dialogue?

GOODMAN: I don't think anyone looks at racist comments with glee. Because when any one person is oppressed, we are all oppressed and that goes across the political spectrum. But I do wish that the media would also focus on progressive movements around the country.

Just a month or two ago I was in Detroit, 15,000 people were there working on issues, everything ranging from ending the war to greening the grid. And these are people that you know come out in far greater numbers than the Tea Party movement. I think the media gives it much more important than it actually wields in this country.

KING: Think that will be one of the lessons come November. It's a great point you make and who will be energized to turn out in November. And we may have a little, a little come up (ph) and see if you will, if that is the case. Joe, in terms of the debate about race, the back and forth, how do we get this -- how do we get out of this? What is the end of the tunnel, if you will?

JOE JOHNS, CNN SENIOR CORRESPONDENT: Yes, it's hard to see. I mean the big problem here I think in politics, you know, what happens when somebody else defines you and you're not able to refute that? I talked to Democrats over the weekend who were just gleeful because they felt as though the racist question with the Tea Party had been asked and answered with these comments. So it's very difficult for them to move forward. However, the good thing is that now once you have sort of opened that Pandora's Box, you can, perhaps, like he said, have a reasonable conversation with your critics about a racism, what is proper discourse in American society and politics.

KING: And hopefully we'll have a calm, levelheaded discourse about that. At the same time, Jessica, for the many overwhelming majority of Tea Party members who are not racist, who wants to voice their disaffection with government for one reason or another and we have to in every opportunity make clear this is not one party.

This is a bunch of different grassroots movements in different parts of the country. It means different things on different issues. But I would suspect there's also a possibility that those people say hey, wait a minute and this would only redouble their motivation to get out and vote and prove they're a viable political movement.

JESSICA YELLIN, CNN POLITICAL CORRESPONDENT: That's right. I've actually been in touch with some folks who are Tea Party activists in their states, people who don't know Mark Williams, have nothing to do with Tea Party Express. And one of the people I've talked to out west responded to Mark Williams' note saying, "Good grief, we have to take a deep breath and realize that anyone who does not think or vote like we do is not evil." So yes, a lot of frustration inside the movement about what he's done to the whole movement. It is a little refreshing though to see infighting on the conservative side instead of the Democratic side. It's usually liberals (INAUDIBLE) doing this.

ERICKSON: John, you know I think one of the larger issues here is that we all these national Tea Party groups, the Tea Party Express, the Tea Party Federation, the Patriots, the Tax Day, the National. These aren't the Tea Party activists. The Tea Party activists are involved at the local level.


ERICKSON: They are affecting change at local level. These national groups seem to be more about title and credit while it's the local guys doing all the work and not getting any credit.

KING: Well the Tea Party movement is one relatively new thing we're trying to understand as we look at the midterm election.


KING: Somebody else who is new on the map is Alvin Greene. He's the Democratic nominee for Senate in the state of South Carolina, came out of nowhere. Even most Democrats in the state don't know who he is or how he won the Senate nomination. But he made a debut of sorts, his big first campaign speech over the weekend, Jessica Yellin was down there for it -- let's play you a little sample. If you don't know who Alvin Greene is, here you go.

(BEGIN VIDEO CLIP) ALVIN GREENE (D), SOUTH CAROLINA SENATE CANDIDATE: I'm the best candidate in the United States Senate race here in South Carolina. I am also the best candidate for the -- I am also the best choice for the image award next year.



KING: Jess, he went on in that speech to talk about very important issues, the graduation rate, the literacy rate, some of the state issues in South Carolina, but he's running for the United States Senate. I did not hear in that speech sort of a rationale for you need me in Washington to do this.

YELLIN: No, no strong rationale for his race, John, and he's campaigning more than that. There's just an inherent awkwardness to the way he is running this campaign. His delivery is unusual and the thing is his own community there feels that he's been sort of mocked by the media broadly. So there was a sense people were rallying around him and trying to give him support and there was a certain amount of pathos here because there's something -- this is unusual.

JOHNS: You know the truth is that I mean wherever they come from, it might be a good idea to have somebody in politics who doesn't seem as familiar as the people here in Washington. That said, the Senate is not an entry level job, you know, and when you look at this, there was a guy, his name was Rod Sheeley (ph), who was a very well known consultant in South Carolina, who something like 20 or 30 years ago actually hired a black man to get into the race to stir up all of the white Republican voters and send them to the polls and it was pretty effective.

He ended up, if I remember correctly, in trouble for it and I tried to get him on the phone but I think he's been sick. But that's the kind of thing that happens in South Carolina. It has unintended affects. It's a little bit unfortunate for the Democrats I think.

ERICKSON: Yes, but we know in this situation, though, that Mr. Greene apparently saved up his unemployment benefits. It's kind of karma coming back on the Democrats I guess. And you know he's the Democratic nominee and the Democrats in South Carolina worked very hard to find someone to run as an independent.

What's sad, and this is a broader brush and I'm going to paint with a broad brush. There will be Democrats in South Carolina who will vote for him because of the "D" next to his name just as there are Republicans who will vote for someone with an "R" next to their name without examining the candidates and you know this isn't an entry level position and this is kind of how our politics has become where we vote for the letter next to the name instead of the individual.

KING: Amy, Erick, Joe, and Jess, thanks very much. When we come back a lot more to come in the program tonight, let me take a peek over here. We'll give you a sense of it here. Here's where we go -- when we come back "Wall-to-Wall", Amy mentioned it a moment ago, a "Washington Post" investigative series, "Secret America". The intelligence community, how it's exploded post 9/11, TMI as in too much classified information. You'll want to learn about this important story.

On my "Radar" tonight, a big name in politics says no to the 2012 presidential race. You'll want to hear his reasons. It's a bit of an evolution.

Also, no he's not on the ballot of this year, the president, but there are some polls about his reelection campaign. And in the "Play- by-Play" tonight, Hayward versus McCain, rocking, socking (ph) debates in the Arizona Senate race.

And who does Joe Biden think is the most powerful person in American politics? Hint? The boss might not like the answer.


KING: In "Wall-to-Wall" tonight, "Top Secret America". This investigative story in today's "Washington Post" beginning a series, we all know the intelligence community has exploded after 9/11, the Department of Homeland Security, more terrorism organizations are operations around the world, new intelligence gathering.

But in this series they talk of 10,000 locations in the United States where government or private contractors are working on intelligence or homeland security matters, 1,271 government organizations, nearly 2,000 private organizations involved in this. And get this number. An estimated 854,000 people have top secret, the highest level of clearance, 854,000 people. A bit earlier I asked Fran Townsend who is our homeland security adviser. She served in the Bush administration. I asked her, isn't that a risk to have so many people with such sensitive clearance?


FRANCES FRAGOS TOWNSEND, FORMER BUSH HOMELAND SECURITY ADVISER: The people who are inside the system full time, you've gotten enough contact with it, you worry less about them. It's not fool-proof of course. But in the defense, an industrial base where you have people who have got clearances or people who have left the government and haven't yet gotten assigned to a contract in the private sector, yes, those are always risks because you worry about those people being approached. It's called the counter intelligence risk that the intelligence committee worries about.


KING: It's a fascinating story, this series just beginning. If you want to learn more about it, go to "The Washington Post" Web site. Here's an interactive map here, shows you where the government agencies are. Let me click off the contractors here and you see these are the government agencies involved in the effort all across the country. Let me bring the contractors back in. These are the private contractors involved -- sorry I hit that one twice. And you can touch this, as you do it you can bring up a part of the country and you can zoom into that location. This is Denver, for example and you see all these things. Now, "The Post" says it didn't put the addresses of the companies in it, didn't name the government institutions, so it says it hasn't done anything to give the terrorists any hints. But Fran Townsend says there is some concern in the intelligence community that this is too much information.


TOWNSEND: The interactive Web site where you're able to get a better sense of exactly which companies are working at which locations, the notion that there are so many locations outside of the Washington metropolitan area where there are major security precautions taken. The fact that people will now have confirmation of where some of these facilities are, and they can use that information for targeting both to try and recruit people who have access to classified information but also if they wanted to hurt somebody. And I think that's the real concern of the White House and the intelligence community tonight.


KING: And again on "The Post" Web site you can see the different agencies of government involved in it, some of the private contractors and what "The Post" says is a number of redundancies in the system -- worth looking at it if you're interested in this very important issue.

When we come back, the Senate majority leader fighting for his political life against the darling of the Tea Party movement, it's today's "Clash" after the break.


KING: Welcome back. A lot happening tonight so let's check in with Joe Johns for the news you need to know right now -- hey Joe.

JOHNS: Hey John. Admiral Thad Allen says tests show far no significant problem with BP's sealed oil well in the Gulf of Mexico. He's OK'ed another 24 hours of testing.

A graffiti message in Juarez, Mexico warns there will be another car bombing within 15 days if the U.S. doesn't look into alleged ties between Mexican federal police and drug traffickers.

And Sarah Palin today endorsed "Mama Grizzly" Kelly Ayotte for the U.S. Senate in New Hampshire. West Virginia's new U.S. Senator, Democrat Carte Goodwin will be sworn in tomorrow and those are some big footsteps to fill there, John, the seat of the late Robert Byrd.

KING: One of his first votes will be when they get 60 votes to extend unemployment benefits. They are waiting for him to take that oath and get here. And a little after that, they will move that one along. They need that vote, Joe.

JOHNS: Hit the ground running, as it were.

KING: You got that right.


UNIDENTIFIED MALE: In this corner, and in this corner --


KING: In "The Clash" tonight, one of the year's best races, the U.S. Senate race in Nevada between Republican challenger Sharron Angle and the Senate majority leader, Democrat Harry Reid.

Joining us is Jon Ralston, a columnist for "The Las Vegas Sun" newspaper and one of the country's best political reporters.

Jon, this is a fascinating race, but it has taken a turn. Harry Reid was viewed as so vulnerable, he was viewed as the Democratic leader how might get beat. And yet, here's your Sunday, column, here's the leader: "With Angle's hot air balloon leaking helium about as rapidly as oil left that Gulf well -- 45 days and counting and the GOP Senate nominee still has not plugged it -- the question is whether she can survive the fall to earth."

What has happened to change this race so fast? I thought Harry Reid was in trouble?

JON RALSTON, COLUMNIST, "LAS VEGAS SUN": Yes. I used to start my articles with "Harry Reid is dead," John. Now I start it with "Sharron Angle is dead." That's how dramatically it's changed.

You know, Harry Reid still has terrible, terrible numbers, John. More than half the people in the state don't want him reelected. Lucky for him, he doesn't need 50 percent. He only needs to get to 43 or 44. He's at that number now in that most recent poll. He has a seven-point lead over Angle.

And since the primary, it's been a daily barrage of attacks from Reid and his allies about her positions on Social Security, abolishing various federal departments, and, of course, worst of all for her in this environment, the clip played over and over again, "Part of a U.S. senator's job is not to create jobs." That's not a good thing to have said.

KING: Well, let's come in right on that point, because this is Campaign 101, especially if you're vulnerable and your opponent is relatively new. Define them before they can define themselves.

And since Sharron Angle won the nomination, Harry Reid has spent at least $700,000 on TV advertising. Here is one sample of Harry Reid using his money to define his opponent.

(BEGIN VIDEO CLIP) UNIDENTIFIED MALE: Sharron Angle says it's not a senator's job to fight for jobs, that we're on our own.

SHARRON ANGLE (R), NEVADA SENATORIAL CANDIDATE: People ask me, "What are you going to do to develop jobs in our state?" Well, that's not my job as U.S. senator.


ANGLE: I'm not in the business of creating jobs.

UNIDENTIFIED MALE: To me, it seems like the only job that Sharron Angle wants to fight for is hers.


KING: A message like that, does it work? You spend the money, you use negative advertising. Look at this. Here is the latest "Las Vegas Review Journal"/Mason-Dixon poll: Harry Reid, 44; Sharron Angle, 37; undecided, 10 percent.

So, so far it has worked, the Reid strategy. Everyone says, John, "Oh, I hate negative ads," "Oh, I hate when they do that," but it works.

RALSTON: Yes, negative ads, the biggest disconnect in the world. You know this as well as I do, John. People do hate them, but they do connect with them. And Harry Reid has run some really tough negative ads, as has an outside group called the Patriot Majority, which, coincidentally enough, is run by a former Harry Reid spokesman.

And they have just been pounding Angle, who is now being forced to put out the worst kind of press releases, John, which are the "What I meant to say" press releases. Well, what I meant to say is that a U.S. senator can create a climate for jobs, can't directly create jobs. What I meant to say is not get rid of Social Security, I want to save Social Security.

And so she's caught between two worlds now, and neither are good for her. Either stick to what you said or change it. Either way, you're going to get in trouble.

KING: You mentioned that, because she is new to the scene, as many of these Tea Party candidates are. The newcomers get in, they're refreshing faces, but sometimes it's tough when they get on the big stage.

I want to play a snippet of an interview you had with her a couple of weeks ago. You mentioned that she has had to explain or re- explain or redefine some of what she said. Here's one of the examples.


RALSTON: The separation of church and state arises out of the Constitution. ANGLE: No, it doesn't.

RALSTON: Oh, it doesn't? Oh, the founding fathers didn't believe in separation of the church, the establishment clause, the First Amendment?

ANGLE: Actually, Thomas Jefferson has been misquoted like I've been misquoted out of context. Thomas Jefferson was actually addressing a church and telling them, through his address, that there had been a wall of separation put up between the church and the state precisely to protect the church.

RALSTON: So there should be no separation? So there should be no separation of church and state?

ANGLE: To protect the church from being taken over by a state religion. And that's what they meant by that. They didn't mean that we couldn't bring our values to the political forum.


KING: There's an interesting issue there about the separation of church and state, John, but also an interesting snapshot there. Her relations with the news media are somewhat testy.

RALSTON: Well, you know, I've known Sharron Angle for some time. That was a very feisty interview, but she seemed to enjoy it, actually, and was perfectly fine afterwards. Although, John, the best part of it was when she walked away from the set. She said, "Something tells me I'm going to see some of what I said in Harry Reid's ads."

How right she was. I have to tell you that I've never received so many copies after that interview of Thomas Jefferson's letter to the Danbury Baptists to explain to me what she meant by the separation of church and state or lack thereof.

KING: Lastly, let's close on this. You mentioned you had before written that Harry Reid was dead. Now you think the table has flipped in this race and that Sharron Angle is the one struggling.

You're in a state still with very high unemployment, a high foreclosure rate, a troubled economy. Is it possible, in your view, that the fundamental dynamics of the election could still catch up with Harry Reid, if you will, or is, in your view, his opponent so flawed, he can't lose?

RALSTON: There's no doubt that Harry Reid is not quite out of the woods yet. We just had the figures come out this morning.

Nevada still has the highest unemployment rate in the country, 14.2 percent -- 14.5 percent here in Vegas. You have American Crossroads, which, as you know, is the Karl Rove group running tons of advertising here, trying to refocus the electorate's attention on the economy, trying to make Harry Reid responsible for the economy. Sharron Angle has been very, very badly damaged by what happened, though, and the question is whether she can right the ship and whether Harry Reid can just keep the attention on her. If the attention remains on her, John, I think she's going to lose.

KING: Jon Ralston, we appreciate your insights and we appreciate your reporting constantly. It's a fascinating race. We will check in. Between 106 days now to Election Day.

Jon, thanks.

RALSTON: Thanks, John.

KING: A high-profile mayor pulls the plug on talk of a 2012 White House run. We'll tell you who and why after the break.


KING: Today's "Most Important Person You Don't Know' is the new front-runner in the Republican primary for Georgia governor. Karen Handel went from eight points behind in the polls to six points ahead in just one week.

The turnaround came after she got the blessing of the most political important endorser you do know, Sarah Palin. However, Handel has more than that on her resume.

She's been working ever since leaving home at 17, sometimes in business, mostly in state and county government. Most recently, she was Georgia's secretary of state. Earlier in her career, the deputy chief of staff for a vice president's wife, Marilyn Quayle.

Now thanks to Palin's magic touch -- her help, anyway -- Handel heads into tomorrow's four-way Republican primary as the leader.

So, let's discuss the Palin factor with veteran Democratic strategist Don Baer and former Republican congressman J.C. Watts.

J.C., to you first.

The Republicans, that's your game. Is she that good, that popular among the rank and file, that if Sarah Palin says, hey, go for Karen Handel, it changes the polls?

J.C. WATTS (R), FMR. U.S. CONGRESSMAN: Well, Sarah Palin definitely has a special sauce in Republican primaries, and I think she's proven it in this race. It's going to be interesting to see in Kansas, the Senate race there, where John McCain and Jim DeMint has endorsed Jerry Moran. Sarah Palin, the running mate of John McCain, endorsed Todd Tiahrt.

So, I think in Republican primaries, you'd much rather have Sarah Palin with you than have her against you. And I think that Georgia race proves it, because she's running actually against some pretty solid, pretty credible fellows in the Republican primary down there. KING: And Don, J.C. just mentioned a race in Kansas where McCain and Palin are on opposite sides. But Palin also endorsed a New Hampshire Senate race today. Kelly Ayotte is the state attorney general. And I was told that John McCain helped deliver this one.

Steve Duprey is the former state Republican chairman. He's helping to raise money. I think he's the finance chairman for Kelly Ayotte. And he worked for McCain very closely. Apparently, he reached out to Senator McCain. Sarah Palin delivers that endorsement.

As a Democrat, as you watch this?

DON BAER, DEMOCRATIC STRATEGIST: Sarah Palin, it all depends on where you sit and what perspective you have looking at her.

There's a poll out today, the Politico poll sponsored by Qualcomm, that is comparing D.C. elites and how they look at these things, and the country at large. And there's a huge split.

D.C. elites, really had a very low opinion about Sarah Palin, but the country at large, they are willing to give her a shot. And especially when you start talking about Republicans. This is somebody who has a lot of credibility out there in the primaries right now. So, she's very polarizing, but when you're situating this in the Republican primaries right now, Sarah Palin is important to these folks.

KING: Do you think she's just trying to be influential, or do you think she's laying the groundwork to run? When she took the Fox job, people said, oh, no, she's not going to run, she just wants to be high profile. But then people see these endorsements and building an infrastructure, and they think, I don't know.

WATTS: Well, she's doing all the things that you do if you want to make a run. I mean, you make an endorsement, she's contributing, she's giving money, she's got a PAC. She's communicating.

She's out there talking about the issues of the day. And we've seen that she can move votes. So, she's doing all the things to create a framework to run. Whether or not she does it, that obviously remains to be seen.

BAER: Sarah Palin has made it clear she wants to be a force in the country and she wants to be a force in the Republican Party, and she wants to maintain her options. Right? So she's playing for 2012.

KING: That's worth watching.

Here's something else worth watching right at the top of my political radar. A high-profile guy. A lot of people say, hmm, will he run for president? He's the New York City mayor, Michael Bloomberg.

He just paid a visit to New Hampshire -- ah-ha -- closed the first in the nation presidential primary. But His Honor is quick to say not about 2012. (BEGIN VIDEO CLIP)

MAYOR MICHAEL BLOOMBERG (I), NEW YORK: I am pro-choice, I'm pro gay rights, I'm pro-immigration, I'm against guns, I believe in Darwin.

No is the answer. And if the press is in the back, it's not true. I'm not running. Make that clear.


KING: That is pretty Shermanesque. And yet, just a week or so ago, I was taking to somebody very close to Mayor Bloomberg who said, "Just keep an eye on this." If Obama stabilizes himself, OK, he won't run. But if Obama comes way down, it looks like the Republicans are going to win, maybe he'll run as a third party.

WATTS: Well, and in that clip, John, if you would have shown more of it, it would have said that he said that his wife and his mother would be the only two people for him. I'm not so sure they would be for him where he stands on all those issues.

So, he's put a lot of stuff out there that he's -- that are hot political issues. But I just think it's such a crazy political environment out there right now. I don't think you discount anything or anybody, including the mayor of New York.

BAER: The big word is "dynamic," right? There's a long time to go. We haven't even had the midterms yet. Everyone is going to take an assessment of this.

Michael Bloomberg, you know, is a very compelling man. He's been a very good mayor of New York City. He's an enormously successful businessman. He's got a lot of wisdom.

Who knows? I mean, there's a long time to go until we get there.

KING: A long time to go, and President Obama has until 2012. And yet, some people are already polling, can Obama win re-election? Well, let's take a look at some of these numbers.

A Quinnipiac poll, General election match-up, unnamed Republican versus Barack Obama, Republican 41, Obama 40.

Now, what does that mean? Let's go back and look at history.

At this point for George W. Bush, well, 50 percent for George W. Bush, Democrat, 34. We should mention, just after 9/11. It was a very different environment.

But what about Bill Clinton? Republican, 39, Clinton, 36.

Don Baer, you worked in the Clinton White House. You know what it's like. Everybody always wants to test, test, test.

The fact that right now it's dead heat, whether you run Barack Obama against generic Republican, or if you put most of the leading Republicans by name in there, the three or four or five top candidates, it's pretty close.

Mean anything?

BAER: Well, it doesn't mean much right now. I mean, I remember the numbers for President Clinton. As you well know, he wound up getting nearly 50 percent of the vote and it was a very decisive victory over Dole.

You know, President Obama, these numbers are not great right now. Again, this Politico poll sponsored by Qualcomm today shows even worse numbers with the generic Republicans. I think it's 37 percent for the president and 42 or so for the Republicans.

But in the head to heads with those national candidates like Romney and Huckabee and others, he is ahead of them. Now, it's not a wide lead, but he is ahead of all of them. So that suggests something.

The public knows him. They're focused on the president every day now, not on these other candidates.


WATTS: Well, John, it is a long time, but I think you have to factor in the fact that President Clinton did win re-election after being down in the polls, generic polls. When you put a Republican's name in there, those names will start to shift.

But I do think one thing the president has to be concerned about is this: the issues that President Clinton and President Bush dealt with 18 months into their campaign, into their presidency, was totally different than what he was dealing with today. President Clinton pivoted pretty well out of some bad issues and went on the offensive, and put us in a very bad situation. I think the American people are intensely opposed to what they see coming out of Washington, out of the administration. I'm not so sure it's going to be as easy for him to pivot out of.

KING: All right. We'll see how this goes. A quick timeout. We've got to get to the segment here.

It's getting hot -- hot, hot, hot in the Arizona Senate race, Republican primary.

"Play by Play" is next.


ANNOUNCER: Here comes the "Play by Play."

KING: Monday night "Play by Play." Here to help us break down the tape, still with us, Democratic strategist Don Baer, Republican, former congressman J.C. Watts. The Arizona Senate Republican primary is fun and feisty. And John McCain is ahead in the polls, but he had his two debates over the weekend with J.D. Hayworth, your former colleague in the House, the former congressman. This one got a little rock 'em, sock 'em.

At one point, J.D. Hayworth was complaining John McCain is spending all these millions of dollars in negative television ads against me, and Senator McCain hit back.


SEN. JOHN MCCAIN (R), ARIZONA: You know, that's a pretty strong attack there. And I am really tempted to respond.

But, you know, I'm reminded of the advice that my old friend Senator Bob Dole told me one time. He said, "Never get into a wrestling match with a pig. You both get dirty and the pig likes it."


KING: So, Senator McCain having fun there using an old Bob Dole line.

Hayworth, though, he was playing a little rough and tumble as well. He was trying to make note of the fact that he thinks the John McCain he's running against now is not the same John McCain, say, from the presidential campaign or the campaign before that.


J.D. HAYWORTH (R), ARIZONA SENATE CANDIDATE: John, you've changed positions so much in this campaign, maybe we ought to set up an extra podium for you depending on which John McCain is going to answer which question.


WATTS: Whoa. You know what I take from those comments from those two guys? I don't think they like each other.

KING: You don't?

WATTS: I don't think they like each other.

The comments that John made, those are comments that you make if you are up by two points, not by, you know, 16 to 20 points, depending on the polls that you see. That's pretty indicative of what the race has become.

KING: Is it unusual? The guy was the Republican presidential nominee not so long ago. Now he seems to be ahead at the moment, but in this environment you take no chances when you have a challenge.

BAER: Well, of course it's unusual, but we are seeing these divisions within the Republican Party. And that's what this is playing out here. I mean, there's Tea Party versus sort of the more mainstream party and no one quite knows where they fit or how to play that. And it's causing a lot of havoc within the Republican Party.

KING: And even as it's clear, bad blood between these two guys, between McCain and Hayworth, McCain prefers, even as he gets a shot in here or there at J.D. Hayworth, he prefers to focus on the guy he ran against but is not running against this time.


MCCAIN: We want the president to come and see the border. Next time he's on a fund-raising trip for Harry Reid, come on, stop by the border.

Medicare is in trouble, my friends. And it's in even more trouble now because of Obamacare.

Next January, my friends, when I'm back there, I'm going to lead the fight again and we're going to repeal and we're going to replace Obamacare.

My favorite bumper sticker lately, Bill, is "Please don't tell President Obama what comes after a trillion."


KING: In a Republican primary that's probably a pretty safe message.

WATTS: Well, and I think, you know, those are the type of things you would expect John to be saying at the outset throughout the campaign, and not focusing so much on J.D., considering that he's up by well into double digits. And I don't think this consternation you see between these guys, it has nothing to do with the Tea Party.

I mean, minus the Tea Party, you would have seen much the same thing. But I think that second half of John's comments were more indicative of the way, I think, a front-runner should be running a campaign.

KING: Nothing to do with the fact that maybe a little hard feelings from the last campaign? You think he still wants to kick the guy a little?

BAER: Oh, I don't think it's that so much as this is what the voters in Arizona in that party want right now. And he figures you better give it to them and not take anything for granted.

KING: I want you to listen to the president today. (INAUDIBLE). A lot of focus on Arizona, I guess, in the "Play by Play" tonight.

The Phoenix Mercury, the WNBA world champions. And the president makes note as he salutes and congratulates the athletes that he gets some advice from ladies at home sometimes too.


OBAMA: I live with three, tall, good-looking women who are quite competitive and push me around under the boards all the time. But I want, you know, Malia and Sasha to know that there is absolutely no contradiction between women who are beautiful and healthy and contributing and good athletes and competitive -- and, you know, when they see you guys every day, that helps them.


KING: We don't take sides here. But as the proud parent of a 13-year-old beautiful young lady who likes to mix it up as lacrosse, basketball and more, amen to that.

WATTS: That's right. I thing president nailed it.

Those young ladies give my daughters, you know, your daughters, all of our daughters, gives them a picture of what it's supposed to look like, and being competitive and being fit and taking care of themselves. Kudos to the president.

BAER: I have two sons who are basketball players. But let me say, this is where the president is really great.

He's at his best in this kind of setting. And one of the things -- back to the polls -- he is still very popular personally.

And one of the things that helps him on that is what you're seeing, his family. People really like him and his family. They see that and it really helps them.

KING: Don and J.C., thanks for coming in.

And do you ever make up a word thinking it really is one? Trust me. "Pete on the Street" is next.


KING: Here's a little political lesson for you. Never "misunderestimate" the ability of a politician to change the political dialogue.

Right, Pete?


People are giving Sarah Palin some grief about using the word "refudiate," which apparently isn't a word. And I've done that.

On my radio show recently, I pronounced the word "facade" "facade." And today I said "normalicies."

So, I know, John, you haven't made too many mistakes like that, but I went out to ask people on the street if they've ever made up a word and then tried to cover for themselves.


DOMINICK: Is "refudiate" a word?


DOMINICK: With an "F." Refudiate?

UNIDENTIFIED FEMALE: No, I don't think so.

DOMINICK: Refudiate?

UNIDENTIFIED MALE: I don't think so.

"Refudiate" is a word?


DOMINICK: "Irregardless" -- word?



DOMINICK: Is "refudiate" a word?


DOMINICK: Is "refudiate" a word?


DOMINICK: Is "irregardless" a word?


Are you going to be president some day?


DOMINICK: Is "irregardless" a word or not?

UNIDENTIFIED MALE: Yes. Yes, I think so.

DOMINICK: What about "refudiate"?

UNIDENTIFIED MALE: "Refudiate," no, that's not a word. No, no, no.

UNIDENTIFIED MALE (singing): Longtime Pete on the Street was refudiated by a lady

DOMINICK: "Refudiate" -- yes or no?

UNIDENTIFIED MALE: I believe that one is a word.

DOMINICK: What about repudiate?

UNIDENTIFIED MALE: That is. DOMINICK: Are you drunk?


DOMINICK: So you never made up a word and then tried to defend its existence?


DOMINICK: Like what word?

UNIDENTIFIED MALE: I can't remember specifically.

DOMINICK: Do you get caught using a word that's really not a word and then you try to be like, oh, no --

UNIDENTIFIED MALE: You try to play it off like everybody is using it.



DOMINICK: Fruple (ph)?


DOMINICK: What does that mean?

UNIDENTIFIED MALE: When you don't know what you are talking about, fruple (ph).



KING: I promise you, my friend, Pete Dominick, I will never refudiate your work for this program. Never.

DOMINICK: Thank you, John. Thanks.

KING: We'll see you tomorrow.

That's all for us tonight. Thanks for stopping by.

"CAMPBELL BROWN" starts right now.