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Interview With Ohio Governor John Kasich; President Obama Meets With Republicans; President Meets with Congressional Leaders; Bernie Fine's Wife Sues ESPN; Korean Car Crash Blamed on Mechanical Failure; Outside Group Ad Wars

Aired May 16, 2012 - 18:00   ET


JOHN KING, CNN ANCHOR: Good evening. I'm John King.

Tonight: Vice President Biden visits battleground Ohio. He says Mitt Romney is a greedy rich guy who doesn't get the middle class. Ohio's Republican governor right here to offer rebuttal.

Plus, tonight's candidate report card grades Governor Romney on this campaign's defining issue, jobs.

And at least Congress has had an excuse for doing nothing today. Its leaders were at lunch with the president agreeing on the menu, it seems, but little else.

We begin this evening with the campaign's biggest issue, the economy and jobs and in what arguably could end up being the defining battleground state, Ohio. Vice President Biden took the Obama campaign's case to blue-collar Youngstown today, casting Republican Mitt Romney as a son of privilege and Vice President Biden his record at a private investment firm suggests Governor Romney cares more about profits than workers.


JOSEPH BIDEN, VICE PRESIDENT OF THE UNITED STATES: My mother and father dreamed as much as any rich guy dreams.


BIDEN: They don't get us. They don't get who we are.


KING: Now, where the vice president was today is you might say is a battleground within the battleground.

Let's look at Ohio. This is the 2008 map. Barack Obama carried the state 52 percent to 47 percent, but, look, a lot of red in here for John McCain. President Obama, then Senator Obama won by winning where the people are. But look at this here. This is Youngstown. This is where the vice president was today.

In the general election, then Senator Obama carried it quite convincingly. But let's go back to the Democratic primaries. Look at this. This was Hillary Clinton country. You have white blue-collar workers. And I am going to bring the state back now. Look at this. Hillary Clinton carried Ohio big-time. Senator Obama winning where you have African-American populations, but among white blue-collar workers back in 2008, that was a big problem for Senator Obama.

That's the reason they sent Vice President Biden here into Youngstown, Ohio. Now, why will this be a battleground in the fall? Well, because it always is. Let's go back and take a look. This is the 2008 election. Again, Senator Obama winning a decent margin there, 52-47. But that's pretty close. If you go back to 2004, George W. Bush just barely winning.

What's different about 2008 and 2004? Look down here. Hamilton County, Cincinnati area down here, President Obama, then Senator Obama, then carried it then. Make that go off. President Bush carried it in '04. President Bush carried it in 2000 as well. Also the suburbs around Cleveland, the suburbs around Columbus and again that area down around Cincinnati, those are the big battlegrounds in a general election in Ohio.

Watch for the candidates to be there in the weeks ahead.

Now, Governor Romney not in Ohio today. He was in another huge battleground state, down here in Florida. But -- but he had the industrial states like Ohio, jobs debate in mind, as he drew this contrast.


MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: We are able to help create over 100,000 jobs. And, secondly, on the president's watch, about 100,000 jobs were lost in the auto industry in auto dealers and auto manufacturers. So he is hardly one to point a finger.


KING: Our chief political analyst, Gloria Borger, is here.

You hear Governor Romney talking about the auto industry, manufacturing, jobs. That will be key in battleground, Ohio. And if you ask the voters right now, President Obama carried it in 2008. Republicans had a great year in 2010. As we head into 2012, they seem a bit conflicted as to the state -- the psychology of this election. How is the economy doing?


Well, and it's one of the reasons Ohio is such a battleground state, because there is really a mixed message there. We were looking at some of the numbers in the state. By a 2-1 margin, people in Ohio believe the state is in a recession, the country is in a recession. But 55 percent also believe that the economy, the recovery has begun.

So, people who believe the recovery has begun, that's good for President Obama. People who believe they are still in a recession and it is terrible, 2-1, that would be better for Mitt Romney. And this is going to be fought, as you point out -- and I was talking to a Romney adviser today, a senior Romney adviser -- this is going to be fought in the suburbs of Cleveland, Cincinnati, Columbus and particularly suburban women.

KING: It is fascinating. If you go back campaign, go back four more years, four more years, four more years, the state hardly changes. Certain areas are locked in Republican, certain areas locked in Democrat.

But you have the area, the suburban area right around Cincinnati, the suburban area right around Columbus and the suburban area up along the lake up around Cleveland. Suburban voters and as you mentioned, suburban women, like in Pennsylvania, in those bigger states when they are locked so close, that's usually the key.

BORGER: Right.

And it's interesting because the Romney people believe that they can really do well with married suburban women. And President Obama's campaign believes that they have a lock on the sort of younger, single suburban women and of course urban women. So, that's going to be the real battleground. We talk about a large gender gap throughout country. But in these specific suburban areas is where it really counts in a battleground.

KING: And the vice president is important to this president because that's his biggest weaknesses is those white, blue-collar guys I call them guys who work with their hands.

BORGER: Right. And you heard Joe Biden make the class argument, I would say, very, very strongly today. They don't know how we feel, he said in Youngstown, Ohio. That is a message that Joe Biden can deliver, but that President Obama would have a tougher time delivering.

KING: Gloria Borger, appreciate your insights. We are going to spend a lot of time Ohio, Ohio, Ohio.



KING: So why worry so much about just one state? Well, this one state could settle the election. No Republican has won the White House in modern times without carrying Ohio.

Republican Governor John Kasich joins us to discuss the 2012 political terrain.

Governor, you are in the middle of perhaps the most competitive battleground state. The vice president was there today trying to convince blue-collar in your state that Romney is a bad guy.

Let's listen.


BIDEN: Then, there is the Romney philosophy, the Romney economics, which says as long as the government helps the guys at the top to do well, workers in small businesses and communities, they can fend for themselves, but the country will be OK if the big guy is doing well.


KING: You hear this coming. Romney is rich. He is greedy, he doesn't care about you, the guy who works with his hands. What does Governor Romney need to do to counter that?

GOV. JOHN KASICH (R), OHIO: Well, John, look, this state of Ohio had a near-death experience in the last few years.

And we came in. And we had lost 600,000 jobs, 400,000 in the last four years. Our credit was going down the drain. We had an $8 billion hole. So, working with the legislature, we were able to balance the budget, cut taxes, build up the rainy day fund from 89 cents to $240 million, get our credit upgraded when the United States' credit went down and get our credit improved out here.

And I -- when Governor Romney was out here, I told him, I said, we are following the formula of streamlining regulations, being job creating friendly, balancing budgets, cutting taxes, and, you know, using common sense. And if you get to be president, we are going to do more of that.

And, frankly, what happens out of Washington is, it creates a wind in my face, uncertainty over Obamacare, uncertainty over their tax policy, uncertainty over the regulatory policy. And when Joe talks about small businesses, this is paralyzing small businesses' ability to make decisions.

So when they don't have certainty, they go the other way. In Ohio, we have given them certainty and things have been improved. But if we can get a Romney presidency, they are going to get much better.

KING: Well, you just made the economic case there. Help me with the empathy case.

I was out there when you were campaigning, when you were running for governor. It was a tough campaign. You like to get on the factory floor, you like to grab people in the street and shake their hands. That's the knock, as you know, on Governor Romney, that he doesn't make the connection, especially with the working class.

What does he need to do to be better?

KASICH: What people really want to know from their doctor is, are you going to make me feel better? And what they really want to know from a president are, are you going to give me some security when it comes to my work? Because if I'm not working, my family is in trouble. And when I am working, the fact of the matter is, my whole family is doing better. So, all this high-fiving, it goes to a certain degree. But it is frankly about, people are worried out here and they want to have some sense that tomorrow will be better. And that's what he needs to communicate. And that's what I have told him.

KING: You know the politics. You used to work in this town, Washington. You were smart enough to get out. And you work out there now.

KASICH: Yes. That's right.

KING: But a lot of people look at the electoral map. When they look at presidential history, they say Romney has to win Ohio. So why not pick a Kasich or a Portman to be your number two?

What do you think?

KASICH: Well, I think Rob Portman would be a great pick.

I'm governor. I have got a job to do out here, John. I mean, I have no interest. And that means I am not even going to express no interest, because that indicates interest.


KASICH: You got to be kidding me.

No, I think Rob Portman would be a great pick. But, frankly, at the end of the day, voters don't vote on the basis of vice president. We always talk about it. It gets everybody fired up. I can remember when Bob Dole picked Jack Kemp. And, my God, isn't he great?

And you know what? At the end of the day, it gets down to Obama and Romney. And what it's going to get down to is this. Obama is going to say, I inherited a mess and I'm making it better. And Romney is going to say, you haven't made it good enough. And I can do far better than you have done.

And it is going to get down to mom and dad and the kids in the living room saying, who do I believe and who do I trust and who do I want to bet the future on? That's what it's going to get down to, not who the vice president is.


KING: Ohio Governor John Kasich just moments ago.

Mitt Romney's message in this campaign, he will be a better president because of his business experience. So, next, a report card on his record when it comes to creating jobs.

And later, a scary video brings back worries of sudden uncontrolled acceleration -- look at that -- uncontrolled acceleration in some cars.


KING: If you had to boil down Mitt Romney's pitch in one sentence, it goes something like this. He has a much better record and resume, he says, than President Obama when it comes to understanding the economy and creating jobs.

But does he? To grade Governor Romney on the jobs questions, these are the big factors, number one, his record at the private investment firm Bain Capital. Number two, his performance in four years as governor of Massachusetts, and number three his promises in this year's campaign.


ROMNEY: Lower the marginal rate and then get rid of some of the deductions and special breaks that big companies get. We are going to get the rates down, particularly for small businesses.


KING: Now, as we continue our report card, a closer look does raise some questions about Romney's record.

Back in the 1994 campaign, he claimed he created about 10,000 jobs because of his work at Bain, but other times, including just today, he said that number is as many as 100,000.


ROMNEY: We invested in over 100 different businesses and net-net, taking out the ones where we lost jobs and those that we added, those businesses have now added over 100,000 jobs.


KING: Now, the Massachusetts record also is a mixed message; unemployment fell during his term. And the state gained about 50,000 jobs. But Massachusetts ranked 47th among the 50 states in job growth those years.


ROMNEY: I came into a state that was in real trouble, huge budget gap, losing jobs every month. We turned it around. Three out of four years, we had unemployment rate below the national average. We ended up with 4.7 percent unemployment rate. I am proud of what we were able to do in a tough situation.


KING: And as for his promises on the campaign trial now, it is a mix of lower taxes, less regulation and trust me.


ROMNEY: My plans get the economy going again. I spent my life in the private sector. I know what it takes to create jobs and to bring business back.


KING: So does Romney's private and public sector resume give him more know-how to create jobs?

Joining me to discuss that and more, Andy Puzder, who is the CEO of CKE Restaurants and a Mitt Romney supporter, and Robert Reich, who was the labor secretary during the Clinton administration, and now the author of the book "Beyond Outrage."

Andy, let me go to you first.

And let's go through those points. Governor Romney and his campaign -- it's not just the governor -- have given different numbers when it comes to Bain Capital. It's a private equity firm. It's hard to say here are the books and throw them open. But how can they give a better, more consistent answer, or is there one when it comes to jobs and Bain?

ANDREW PUZDER, PRESIDENT & CEO, CKE RESTAURANTS: Well, it is very, very difficult to give an accurate answer on the number of jobs created because of the number of companies that they invested in, the number of companies that they created, and the period of time over which they were open and when Governor Romney was there or not there.

I think Staples alone accounts for about 90,000 jobs. But private equity firms, that's what they do. They want growth. They want companies to grow under their guidance. They want more jobs. They want higher profits. They want real economic growth. And Governor Romney did spectacularly well with that while he was with Bain Capital.

KING: And, Mr. Secretary, at the moment, the Democrats, including the Obama campaign, seizing on one company where they did shut it down. And Governor Romney was a principal in that. It was a steel company. They did shut it down.

Is it fair if you are trying to look at his record at Bain to say, as Andy just mentioned, Staples as a plus, to say, oh, no, GST, huge minus? Do we have to look at it at all or can you pick out individuals?

ROBERT REICH, FORMER U.S. LABOR SECRETARY: I think you have to look at it and ask yourself the very fundamental question, John, and that is, does private equity and private equity firms generally, do they create a lot of jobs? Are they great for the economy? Or is it just moving money from one set of pockets to another set of pockets?

What is private equity all about anyway? Private equity managers, such as Bain Capital and Mitt Romney, they have lived off a loophole that allows them to treat all of their earnings as capital gains. That's one reason that Mitt Romney, who earned about $20 million, $21 million over the last few years, pays a tax rate of only about, well, 14 percent or 13 percent. Private equity is not a magic trick. It is a trick. It is not generating a lot of new jobs. That's like saying anybody who invests in any job creating company is creating those jobs. The creation of the jobs come from the individuals who are managing that firm, since Bain Capital left that firm.


KING: Andy, is private equity a trick?

PUZDER: It is not a trick at all. There is so much in that I really hope I get a chance to address it.

If you are a private equity firm, what you want to do is you want to buy a company at a multiple of its cash flow. Let's say the firm had $1 million in cash flow or EBITA. It was for sale. The founder wanted to leave or there was a problem. You would buy maybe at a six multiple, so you would pay $6 million for the company.

What you want that company to do is you want it to grow. You want the cash flow to grow and you want the company to improve so the market will give you a higher multiple when you go public again. So, you do what you can. You work on marketing products, you work on how they manufacture products. You work on cutting expenses. You work on creating new ways for the company to make money. You want to add jobs. You want it to grow. You want it to get bigger.

And then when it does, the market value is at let's an eight multiple. And maybe you get that cash flow to $1.5 million. And now you can sell it for $12 million. And that $12 million doesn't just go -- the profits don't just go to some private equity guys that are looking sitting around trying to wait to make money. It goes to pension funds that invest in these private equity firms. It goes to university endowments. It goes to sovereign wealth funds.

You can't find a policeman, a teacher, or a fireman in this country that doesn't have some of their retirement income invested with private equity, and that -- they invest in it because it gets a very, very good return.


PUZDER: As far as the tax loophole, look, that loophole was there when Clinton was president. It was there when President Obama had control of the House, he had a filibuster-proof majority in the Senate, and he was the executive.

And nobody, even though Congressman Levin from Michigan tried to get captured interest taxed as ordinary income, nobody would do it. And it is because it incentivizes a particular conduct. It's not a loophole. It's something that is legitimate. Nobody has gotten rid of it. And it has been very, very successful.

KING: We could continue this conversation. And I think we will continue this conversation almost every day between now and the election. But I want to ask one more question to each of you. And I will be glad to bring you both back. There is a lot more I would love to cover.

Let me cover this one, just this one right now, though.

Andy, to you first and then to you, Secretary Reich.

Governor Romney says he has these turnaround skills. I understand when he was governor, nationally, it was a tough time and we should put that on the table. But if he is so much better than everybody else at this, why was Massachusetts 47th out of the 50?

PUZDER: What you are looking at is a percentage. Massachusetts didn't start off with 10 percent unemployment. They were a little above the national average at 5.6 when he took over his government.

And they were bleeding jobs. When he left, they had created tens of thousands of jobs. He had employment at 4.7 percent, which was under the national rate. If you wanted a job in Massachusetts when Mitt Romney was governor, you could get one. And I wish we could say the same in the United States today.

KING: Mr. Secretary, when he was governor, did he do as well as he could given the national economic circumstances?

REICH: Well, in his first three years, he generated or at least presided over an economy that generated 5,600 jobs, 5,600. That's not a lot of jobs.

Over the last 26 months, the administration, granted, we are talking about the entire nation, but the Obama administration has generated or presided over an economy that has generated 4.2 million jobs.

We have got to be very clear about this. To try to compare what one governor has done in one very small time period with what the entire nation is doing or try to say that because somebody was a private equity manager who could very quickly pump and dump companies using very short-term strategies such as Wall Street has been using for years, got us into a big, big mound of trouble is ludicrous.

The question is, which of these men can be trusted to really preside over an economy that is recovering, that should be recovering, that is going in the right direction already? And I think the answer is President Obama is showing that he can take an impossible situation and actually get the economy going again.

KING: Well, gentlemen, I appreciate your passion on this issue. It is the defining question of the campaign. So, as I say thank you tonight, I will say before I do say thank you that we will have you back another day, because we have a lot more ground to cover on this question, both Governor Romney's record and the president's record.

Andy Puzder, thanks so much.

Mr. Secretary, thanks to you as well. PUZDER: Thank you, John.

KING: And still ahead here: the "Truth" about the group spending record amounts of money to influence your vote this fall.

But, first, a company that makes shoes you may own fined millions for false advertising.


KING: Welcome back.


KING: A new twist today in the scandal of a former assistant coach accused of molesting boys. His wife is suing ESPN, the network that broke that story.

Also, a couple claim -- get this -- their car sped up on its own to 80 miles an hour. Wow. And they say that video right there proves it.


KING: This half hour, the wife of a former basketball coach says ESPN ruined her life. Her husband is accused of molesting boys. She's accused of knowing about it. But now she's suing.

Imagine being behind the wheel when your car goes berserk, suddenly speeding to 80 miles an hour. Why the driver says there was no stopping this out-of-control vehicle.

Plus, sick of negative campaign ads? Well, I hate to break it to you. But this is just the beginning. The truth about who's spending millions to sway your vote.

Here in Washington today, President Obama visited a local deli that supplies sandwiches, chips and cookies for his lunchtime get-togethers with congressional leaders. You see the president there.

The White House, though, not releasing any pictures of the actual meeting, which just like this entire session of Congress, didn't seem to accomplish much.

CNN senior congressional correspondent Dana Bash joins us from Capitol Hill. Dana, let's start with that meeting at the White House. No pictures. What's the word?

DANA BASH, CNN CORRESPONDENT: We know people out there may hope -- they're optimists out there -- that when the cameras aren't there, that the microphones aren't there, the presidents and leaders are behind closed doors, they can roll up their sleeves and really discuss the issues and problems, not just big speeches.

Well, guess what? According to accounts from sources in both parties, that's not what happened. Apparently, what they discussed in private is pretty much what they say in public. The president talked about his five-point to-do list that he wants Congress to accomplish when it comes to the economy.

And the Republicans with the House speaker, John Boehner leading the charge, talked about what he said in public, that he really believes that spending cuts have to be a big part of any debt ceiling vote in the coming months. And of course, they talked about tax cuts.

So you know, it's certainly -- is a little bit disheartening to hear that they didn't get a lot done. It might be what's going in the second time in almost half a year that they had this kind of meeting. But one thing they did agree on, John: they liked the sandwiches.

KING: We can't name it here; it would be wrong. We know that deli. They make good sandwiches. So I guess we can say that.

All right. Let's turn then. There's a lot of posturing, as you just noted. I want you to listen here to a man you know well, to Democratic -- Democratic Congressman Jim Cooper of Tennessee. I think a lot of Americans would think this is a great idea.


REP. JIM COOPER (D), TENNESSEE: I'm proud that the Fix Congress Now Caucus is supporting no budget, no pay. That's a bipartisan reform to get Congress to do its most basic work on time. They would have to pass a budget and the appropriations bills before October 1 of each year. Now, the way the Constitution works, we can't change it this year, but we can change it for the next Congress.


KING: So Dana, you've got to love this idea. You do your work, you do it on time, or you don't get paid. That's what Congressman Cooper says and his friends say should happen in Congress. But I'm going to be there, take us to the Senate floor today. No?

BASH: Not so much. They spent all day, John, six hours of debate and almost two hours of voting on five budgets that everybody knew from the get-go had no chance of passing. And that's, of course, what happened.

Now, it was Republicans who pushed this issue. They wanted to make the political point that Democrats who run the Senate haven't passed their own budget in three years. And so they did it by proposing several conservative budgets to show that at least they have ideas.

And also, the president's budget, to try to embarrass the president, to show that he is getting no votes. In fact, it was 99-0. Not even one Democrat voted for his budget for various reasons.

But you know, Democrats took their opportunity of this political theater to stage their protests against conservative ideas. I've got to tell you: watching this all day today, people out there who are worried about the fact that members of Congress are speaking past each other and they're not getting things done. This is a perfect example of politicking instead of problem solving.

KING: Posturing, politicking, speeches, your government not at work.

BASH: Not so much.

KING: Our senior congressional correspondent, Dana Bash. Dana, thanks.

ESPN dropped a bombshell on the college basketball world when it aired a report suggesting that a Syracuse assistant coach, Bernie Fine, molested boys and that his wife knew about it.

Fine lost his job, and now his wife is going after ESPN, suing the network, a reporter and a producer for libel, saying they falsely painted her as a monster who witnessed the molestation and didn't stop it.


LAURIE FINE, WIFE OF BERNIE FINE: I am here today as a wife and mother who has had to endure the trauma of being smeared in the public as a monster. My family and close friends have stood by me. They know that I am a kind and loving person. But my life has been destroyed through the defamation that I have suffered, and this will last a lifetime.


KING: ESPN released a statement, that statement saying, quote, "The suit is without merit and we stand by our reporting."

Let's bring in legal analyst Sunny Hostin live in New York for us. Sunny, libel is a tough one to prove. Does she have a case?

SUNNY HOSTIN, CNN LEGAL ANALYST: You know, you're right. Libel is a very difficult -- difficult case to prove, especially because truth is an absolute defense to a libel claim.

And so the bottom line is she has to prove, John, that these allegations were false. She has to prove that all of the information published by ESPN that she discusses in her 44-page federal complaint is false. And that is very difficult to prove.

The other thing I think that she's going to come up against is the fact that there are tape-recorded conversations between Mrs. Fine and one of the alleged victims. I've read the transcripts to one of the tapes. And she has actually confirmed that she did have that conversation with Bobby Davis, one of the alleged victims. Although, she now claims that the tape-recording itself was doctored.

And so I would suspect that this is going to be a very difficult case for her to prove.

KING: Well, let's listen to part of one of those conversations. Again, it's a secretly recorded call. It's Mrs. Fine talking here to Bobby Davis. He's one of the men, then a younger man, who accused Bernie Fine of sexual molestation. Let's listen.


FINE: I know everything that went on with him. Maybe they're just not aware of but you trusted somebody you shouldn't have trusted.


KING: What she is saying right there, Sunny, her husband has issues. You trusted someone you shouldn't have trusted. If you're saying, wow, she's talking to a kid who was molested, it sounds pretty damning. She is now saying she was talking about her husband having financial issues. Can she make that case?

HOSTIN: You know, I think it's going to be difficult. Because again, I have read the entire transcript. I have it in front of me. And while certainly they do discuss financial issues, they also discuss sex acts, John. They also discuss molestation in particular.

And so for her to really prove this libel claim, she's going to have to prove that this conversation either didn't happen or that the tapes, in fact, were doctored or that it's not her voice. And again, she's already confirmed that she did have this conversation with Davis.

And so if it goes to court and goes to trial, it will be up to a jury to determine what the truth is, and in the face of this type of tape- recorded evidence, I think that's an uphill battle for her.

KING: Sunny Hostin, breaking down the legal issues for us. Sunny, thanks so much. It's a fascinating case. We'll keep an eye on it.

Imagine this. A car speeds through two red lights, then crashes at 80 miles an hour. The driver says it is not his fault, claiming the car sped up on its own. And the family hopes a dashboard camera video will prove it. Here's CNN's Paula Hancocks.


PAULA HANCOCKS, CNN CORRESPONDENT: The 30-year-old son of the couple in the car, who only wants to be identified by his surname Kwon, says that he posted the footage of the May 6 crash online because he wanted to prove that it wasn't his father's fault.

(voice-over) The footage is from a camera attached to the rear-view mirror, which is fairly common practice in Korea. Kwon tells CNN his parents, both in their 60s, heard a weird noise before the Hyundai Sonata accelerated.

The footage shows the car swerving to avoid other vehicles and also driving through two red lights. It eventually crashed into a stationary car at a speed believed to be around 80 miles an hour or 128 kilometers.

Kwon says his mother underwent an operation for internal bleeding and is waiting for a second operation on her back and that his father has fractured ribs and finger. Official investigation is underway. The Ministry of Land, Transport and Maritime Affairs says they're currently investigating four other cases of sudden, unintended acceleration.

They declined our request for an interview but did send a statement saying, "The vehicle is being investigated by the Korean national forensic service. There is no time estimate for the conclusion of the investigation."

Japanese carmaker Toyota recalled millions of cars back in 2009 due to cases of sudden, unintended acceleration.

(on camera) Paula Hancocks, CNN, Seoul.


KING: Watching that video, woo. We'll see how that investigation goes, as well. Paula, thank you.

Whether you're watching TV, listening to the radio or maybe just surfing the Web or social media, some people will be spending record amounts of money this fall to influence your vote. Next, the "Truth" about political ads you can't dodge.


KING: You pick a president in 174 days. And like it or not, you're already getting plenty of help with your choice. From the right...


UNIDENTIFIED MALE: President Obama's agenda promised so much.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: We must help the millions of homeowners who are facing foreclosure.

UNIDENTIFIED MALE: Promise broken. One in five mortgages are still under water.


KING: And from the left.


UNIDENTIFIED MALE: Bain Capital always made money. If we lost, they made money. If we survived, they made money. It's as simple as that.


KING: Tonight's "Truth" is a fact of modern-day campaign life. You might be sick of them already. But the political TV ad season is just beginning to heat up. And much of the spending isn't from the Romney or the Obama campaign. Those so-called super PACs have spent about $5 million just in the last month. Well, many times that will be spent over the next 25 weeks. And surprise, surprise, a lot of those ads will twist or at least shade the truth. That anti-Obama ad from the conservative group Crossroads, for example.


OBAMA: If you are a family making less than $250,000 a year, you will not see your taxes go up.

UNIDENTIFIED MALE: Broken. Obama care raises 18 different taxes.


KING: Truth is, this one could come down to how you define taxes. The president has not raised tax rates on those families or on anyone for that matter. The health-care law does include some new fees that Republicans call taxes.

And then there's this one here from the anti-Romney or pro-Obama Priorities USA.


UNIDENTIFIED MALE: He promised us the same things he's promising the United States. He'll give you the same thing as he gave us, nothing.


KING: Now, the "he" there that gentleman is referring to is Mitt Romney. The candidate himself tried his hand as fact checking that one.


MITT ROMNEY (R), PRESIDENTIAL CANDIDATE (via phone): They said, "Oh, gosh, Governor Romney at Bain Capital closed down a steel factory." But the problem, of course, is that the steel factory closed down two years after I left Bain Capital. I was no longer there. So, that's hardly something which is on my watch.


KING: Now, more people see the ads, any ads, than see the fact checks. And history proves attack ads work, even if voters complain they're too negative and too frequent. So expect more, a lot more, especially if you happen to live in a battleground state.

Here tonight to talk truth, the "New Yorker's" Washington correspondent, Ryan Lizza. Bill Burton is the senior strategist for that pro-Obama super PAC, Priorities USA. And Republican strategist Rich Galen.

Mr. Burton, to you first. Governor Romney says your ad is wrong. That he was gone, that he was two years removed from Bain Capital when they shut down that steel plant. Therefore, you can't blame him. You would say? BILL BURTON, SENIOR STRATEGIST, PRIORITIES USA: I would say that actually, if you look what Mitt Romney did, he pushed that company towards bankruptcy and caused it to go down making thousands of people lose their jobs. And their -- and their promise of health care.

It's not funny to the folks that lost their jobs.


BURTON: And their health care benefits and retirement benefits.

KING: It's actually not funny. So how do we find out? He was doing the Olympics at that point. There's no question: he was part of the purchase. He was part of the investment. He says that, you know, Staples is still creating jobs. He should get some credit for that. Other companies are still creating jobs. He should get some credit for that.

I assume your argument is, OK, if that's the case, if something you left goes down, then how do you make the decision?

BURTON: This -- you know, what he says about these success stories actually sort of makes our point, which is that if a company has succeeded, Mitt Romney and Bain Capital made money. If it failed, Mitt Romney and Bain Capital made money. And so I think it's worth looking at this broader picture of what happened when he was at Bain Capital, since this is the centerpiece of his argument for why he should be president.

GALEN: But the broader -- the broader picture is, if you're going to say that anything he did while he was at Bain Capital carries over after, then you have to give him credit for the 100,000 or whatever the number is jobs. Because that continued on afterwards.

I think that it's amazing that they said -- they set out, Joe Biden, who has never created a job in his life, has been a member of the most exclusive club on the planet, the United States Senate, since he was 20 -- about 30, elected when he was 29. And he -- and they sent him out.

If ever there was an example of chutzpah, it was Obama -- or it was Biden today in Ohio talking about how Romney treats people like us. He's never been like that.

KING: Well, he comes from a blue-collar town.

GALEN: Right, 40 years he's been in the Senate.

KING: On this -- on this argument. It is -- Bill is right. And Governor Romney would not disagree that point. It is the central argument of this campaign: "What I did at Bain and," he says, "as governor proves I'm better at this economy thing than the president."

What more can they do? Or are they just going to -- are we going to debate whether it's -- you know, he'll debate Staples as a success. You say GST is a failure. Is this what we're going to do for 174 days?

RYAN LIZZA, WASHINGTON CORRESPONDENT, "THE NEW YORKER": Well, if you're going to -- if you're going to claim credit for the jobs created, you've got to eat the jobs lost. And we still don't have an accounting of these jobs. And I wonder if we have a jobs gained, jobs lost. Bain Capital has told reporters they won't confirm one way or another.

I think the problem for Romney is the metric Bain Capital used for success was not jobs created or jobs lost. They will tell you that. That was not the metric. The metric was profitability. OK?

And Romney has a pretty good success story to talk about if he wants to talk about his years at Bain in managing Bain in a way that was incredibly successful. What's happened in the heat of the campaign he's decided to -- to reinterpret his years at Bain as a job -- in terms of jobs created.


KING: And he doubled down today. He doubled down today. Let's listen. He brought it back up, that number.


ROMNEY (via phone): We were able to help create over 100,000 jobs. And secondly, on the president's watch. About 100,000 jobs were lost in the auto industry and auto dealers and auto manufacturers. He is hardly one to point a finger.


KING: Now, if you want to -- this is what the Romney campaign says. But they do -- they list the companies here. If you go to their Web site, you'll see jobs at Bain. If he's going to say 100,000, and they're going to put this out, is he then open to criticism?

GALEN: He didn't say that in that clip but it did say in the clip you played earlier in the show. He said net-net. So he is counting the jobs that were lost along the way, plus the jobs that have been gained along the way. So you know, that's a legitimate claim.

Let me say this. The first segment you had, I don't remember the guy that was on with Robert Reich, because he got it right.

KING: Andy Posner (ph).

GALEN: That's right. But he's -- the Bain Capitals of the world, they get their -- the private equity, the equity comes from pension funds, from teachers' funds, from firemen's funds. A lot of people depend on organizations like Bain Capital managed correctly so that they can retire.

LIZZA: Journalists covering this are trying to figure out the truth here. It's hard. Neither Bain nor the Romney campaign will give us a company-by-company breakdown of everyone that Bain was involved with when he was there, jobs lost, jobs gained.

KING: And there are some legitimate -- there are some legitimate privacy questions there, because it's private equity. However, it's a tougher one.

Gentlemen, stand by. We'll continue the conversation in a moment.

"ERIN BURNETT OUTFRONT" coming up at the top of the hour. And Erin, you're watching this troubling news out of Greece, nervous investors around the world. What's going on?

ERIN BURNETT, CNN ANCHOR: You know, it's getting worse and worse, John. You know, a few months ago I was talking about this and saying maybe it's all right to let Greece go. And it's seeming more and more likely that Greece may choose to leave the euro. This is something that would have worldwide implications.

But the human side of it, we're going to talk a little bit about that. You had lines at banks around Greece today. In just one day, Greeks took out nearly a billion dollars in euros out of the bank. The reason is they're worried that those euros are going to, well, turn into drachmas, and the Greek drachma wouldn't be worth as much, John. A billion dollars, that's a lot of money.

Since the financial crisis began in Greece at the end of 2009, they've been pulling out about four billion euros a month. So this is -- this is a very significant story. If you start to have a run on the banks, this story could really spiral out of control.

It hasn't yet and that's important, but we're going to talk about where it could go from here, because it's now a domino that could come right back over the Atlantic, which as Richard Quest says, you know, is as wide as a bathtub.

KING: As wide as a bathtub.

Erin Burnett, we'll see you in a few minutes. Erin, thanks.

A record-breaking 12 million people watched MTV's Video Music Awards. Last year, the network shifting its schedule, this year to accommodate an even bigger event. What it is after this.


KING: We're back, talking politics with Ryan Lizza, Bill Burton and Rich Galen.

Gentlemen, we ask ourselves why is the race so competitive, presidential race essentially a dead heat. Look at this "USA Today"/Gallup poll. Favorables ratings of the candidates. Favorable for Governor Romney, 50; unfavorable 41. For President Obama, favorable 52, unfavorable 46.

So Governor Romney, Bill Burton, as the guy who's here to help the president, he's come way up. If you look at what's happened just since, if you go back, he's up 19 points among conservatives, 22 points among Republicans. You say among those two, OK, the primaries are over. The guys who voted for somebody else have come home.

He's also up 15 percent among people, high school graduate or less which, in the primaries, was a huge weakness. That has to worry you. He's essentially even when people ask favorable or unfavorable.

BURTON: I would say that it is worrying. I think that this is going to be a very close election, starting now, going all the way to election day. I think it's going to be two points either way. And you know, come election day, it's going to come down to a real choice.

And in the key states around the country -- Colorado, Virginia, Florida, Pennsylvania, places where we're up -- you know, there's a dogfight.

KING: Places where you're spending all your money?

BURTON: There's a dogfight in all those places.

KING: Has governor Romney done something to improve his standing, or is this the natural elasticity of the campaign?

GALEN: It's the natural flow of events. As the -- as the primaries have faded away -- there's still one more big day June 5. But the -- but yes, everybody is getting behind.

Remember four years ago we were still in the dogfight between Mrs. Clinton and Mr. Obama. They hadn't settled it for two or three weeks. But they got in behind each other so, yes, this is what's happening.

But you're right, I mean, anybody who says this guy is going to win or that guy is going to win have no idea what they're talking about. Because if we've learned anything, polls that we were seeing on Fridays during the primaries had no relationship to what we saw on Tuesday.

KING: But the personal likability is still an issue for Governor Romney. And people like this president. Even people who don't support him like the president; they like his family. Will that matter in the end if it is 50-50? You know, they're going to debate tax policy, education policy, national security policy. How much is going to come down to "I like this guy"?

LIZZA: That's always a big deal in these elections, but the favorable/unfavorable is very volatile. It's been all over the place in the last month.

I think that these polls show two things. One, we have a polarized electorate. Republicans came over to Obama. It's going to be, you know, 45-45 locked in on each side and just about 10 percent in the middle. And one guy who got it right, Eric Fernstrohm (ph). There really is an Etch-A-Sketch. You shake it up and the general election starts over.

KING: Well, it starts over. I'm not sure if you'd agree.

GALEN: I've got two words for you: Richard Nixon. He got elected probably three times.

KING: Those words haven't been spoken on this show in a very long time.

GALEN: But he was elected three times.

KING: Rich, Bill, Ryan, appreciate your coming in.

Here's Kate Bolduan. She's back with the latest news you need to know right now.

Hey, Kate.

BOLDUAN: Hi, there, John.

The man known as the Godfather of Go-Go, guitarist and singer Chuck Brown died today. Brown and his group The Soul Searchers topped the R&B chart in 1978 with their hit "Busting Loose." He was 75 and died of multiple organ failure brought on by a bacterial infection in his blood.

And more homeowners are making their payments on time. Delinquencies on mortgages dropped to a four-year low in the first quarter of this year. The Mortgage Bankers Association says just over 11 percent of homeowners have fallen behind or are already in the foreclosure process. That's the lowest level since 2008.

And attention, men looking to add some ambience to your man cave. Yankee Candles is now selling man candles. Yes, I did say that. Candles with scents of wood, freshly cut grass and even leather. And check out these names. First Down combines orange and leather to remind you of -- what else? -- game day. And would you like to whiff some sawdust? Two by Four should do the trick there.

I don't know if I enjoy the smell of leather. I don't know.

KING: I will listen when they start selling wheat hops and barley.

BOLDUAN: There you go. Of course, that's the smell that John King loves.

KING: All right. Stay with me, Kate.

Finally, tonight's "Moment You Might Have Missed." If a major scheduling conflict hadn't been fixed, two very big although very different events on calendar September 6. That's when a guy named President Obama will accept the Democratic nomination for president. He'll be in Charlotte, North Carolina.

MTV will host the Video Music Awards out in Los Angeles, so MTV now agreeing to move its big show up an hour to 8 p.m. to, quote, "avoid conflict." And let's face it: the president wouldn't want to compete for attention with the likes of Lady Gaga and Justin Bieber, especially if you're trying to get voters from that MTV generation.

Right, Kate? BOLDUAN: Yes. I mean, in my mind, it's either hilarious coincidence or a genius scheduling maneuver. You already have the MTV generation sitting down for the awards. There's your audience.

KING: Bill Burton is scribbling notes here right now. He's going to advertise -- his super PAC is going to advertise during it. They may even get Justin Bieber in an ad.

BOLDUAN: Write it down, Burton.

KING: We'll see you all back right here tomorrow night. "ERIN BURNETT OUTFRONT" starts right now.

BURNETT: "OUTFRONT" next, a bold threat by Speaker Boehner...