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JOHN KING, USA

Jamie Dimon Appears Before Congress; U.S. and Russia Spar Over Syria

Aired June 13, 2012 - 18:00   ET

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


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

Tonight: J.P. Morgan CEO Jamie Dimon explains a $2 billion trading debacle to Congress. And if you're mad the banks can still take ridiculous risks, well, it a safe bet you won't like the tone of the questions.

Cold War deja vu as Washington and Moscow spar over who is to blame for the escalating violence in Syria. Fareed Zakaria joins us to lay out the stakes.

And there will be no retrial in the case of the United States vs. John Edwards.

We begin with what you might call today study in contrasts up on Capitol Hill. Jamie Dimon, he is the CEO of J.P. Morgan Chase, one of the nation's biggest banks, came to Congress to apologize his bank's bad investments that lost at least $2 billion, you remember that, back this spring. But in almost the same breath, he cautioned lawmakers against imposing any tough new regulations on the banking industry.

(BEGIN VIDEO CLIP)

JAMIE DIMON, CHAIRMAN, J.P. MORGAN CHASE: The capital markets of America are part of the great American economic business engine. We have the best in the world. We had some problems. We should recognize we're the best. We don't want to throw the baby out with the bathwater.

(END VIDEO CLIP)

KING: Let's get some perspective from our chief business correspondent, Ali Velshi.

And, Ali, let's start by listening to a bit of Mr. Dimon's testimony, where he's talking about what went wrong.

ALI VELSHI, CNN CHIEF BUSINESS CORRESPONDENT: Sure.

(BEGIN VIDEO CLIP)

DIMON: A granular limit says you can take no more X risk than Y, and no more this risk in a name nor this risk in a market, including things like liquidity risk so that you're controlled. In the rest of the company, we have those disciplines in place. We didn't have it here, and that's what caused the problem.

(END VIDEO CLIP)

KING: Help me out, my friend. Number one, translate that to English. And, number two, did he make the case that this cannot happen again?

VELSHI: Right. No, he didn't, answer to number two.

Let me tell you, number one is what you and I talked about several weeks ago when this first became news. And I said the reason this worries me is it sounds a lot like AIG, which was a very healthy company that had risk practices in place across the company, except for this one office in London. Same thing in J.P. Morgan's case.

They have this one office in London which is confusingly called the chief investment office. And its job is to look at everything else the company does and hedge, basically say in case world turned on its head, we would try and protect ourselves by making unusual investments over here.

So, on one side, they look like risky, unorthodox investments. On the other side, they are meant to protect the company if something goes south. Because they're a form of insuring the company or hedging the company, they didn't have to follow the same rules that the bulk of J.P. Morgan Chase had to follow, which is why they lost more than $2 billion when things didn't go their way.

So, the point he was making to the Senate is that most of the company operates under rules that are safe, and governed, and have risk management in place. The risk management office didn't operate under that, those rules, and that's what went wrong.

KING: And so you have got a multibillion-dollar loss. This is a committee of the Congress that oversees the industry. Let's listen to a few of the questions.

VELSHI: Yes.

(BEGIN VIDEO CLIP)

SEN. RICHARD SHELBY (R), ALABAMA: To detail what really happened here we're talking in general terms now, would you feel better in a closed hearing?

SEN. JIM DEMINT (R), SOUTH CAROLINA: It is comforting to know that even with a $2 billion loss in a trade last year, your company still I think had a $19 billion profit.

(END VIDEO CLIP)

KING: Hardly hostile, some say maybe even too cozy. Fair?

VELSHI: Ridiculous, John.

It's why Americans get frustrated sometimes. I have to tell you two things. One is the whole hearing didn't make a lot of sense because there's no allegation whatsoever of wrongdoing. The fact is, the rules, the very rules that the Senate didn't allow to happen to keep these guys in check weren't broken.

So, Jamie Dimon, who is a charming guy who gets along with everybody, and doesn't like regulation, gets to sit in front of a body that didn't want to regulate them anymore and those softballs at them. So, the bottom line is this ended up being much ado about nothing.

You remember the last time there was a big hearing with an investment banker. It was Lloyd Blankfein of Goldman Sachs. There was fireworks all day. There was hours and hours and hours of testimony and accusations. That's not exactly what this was today.

KING: Not at all. Not at all.

Our chief business correspondent, Ali Velshi, Ali, thanks.

VELSHI: OK.

KING: Moving now to presidential politics.

At exactly the same time tomorrow, both President Obama and his Republican challenger, Mitt Romney, will be in the battleground state of Ohio giving speeches about the U.S. economy.

Our chief political analyst, Gloria Borger is here with a bit of a preview.

Let's start with a new Washington Post/ABC poll, because it underscores the stakes. Favorable or unfavorable opinion of the candidates' plans for the economy, President Obama, 43 percent favorable, 50 percent unfavorable, Governor Romney 40 percent favorable, 46 percent unfavorable. That's roughly a dead heat.

How important is this speech for the president? Yes, it is only June. But a lot of Democrats are getting nervous. And he wants to make the case to the American people that things are getting better, but I need four more years.

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: Right.

What the president has got to do is defend his economic record. He also has to remind people of the context in which he took office. But here is the key. He can't seem to be whiny about it and say, oh, woe is me, it was so bad when I came here, but we have made it that much better.

The problem the Democrats are having right now, and the arguments that are going on behind the scenes, is should the president lay out a really big and bold economic vision to the American people about where he would take the country in the next four years, or should he just sort of stay on this here is my general vision vs. Mitt Romney's general vision, and here is why I would be better for the middle class? Lots of Democrats are saying lay out your plan now. Some are saying wait until the convention and lay out a big, bold plan at the convention, particularly if the economy is not doing well.

KING: If you look at any of the polling, Governor Romney sometimes even in states where he trails the president in the horse race, who would you vote for, he tends to either be equal or doing better than him when voters are asked who do they trust to handle the economy. We saw that in Pennsylvania yesterday. It's the case out in Ohio.

He gave a speech in Washington today, probably pretty similar to what we will hear tomorrow talking to a business group, saying most of you aren't the bad guys, you're the good guys, you create the jobs, and this president thinks you're the bad guys. Is that the winning message or does he need to be broader and bolder too?

BORGER: Well, this may be also about fund-raising, which is he thinks the private sector -- the president thinks the private sector is doing just fine, I know you're not, I'm on your side, please write me a check when you leave the room.

And there's plenty of opportunity for that. But I think what Mitt Romney is trying to do is say, look, the president is not being specific. I am going to get a little bit more specific with you. I'm going to tell you I want to reform taxes, I want to repeal President Obama's health care reform, I want to build the Keystone pipeline.

So, he is trying to tell business and to tell those voters in Ohio that unemployment may be 7.4 percent, but I would make it lower.

KING: And what do the smart people say about when the psychology kicks in? Is it the next jobs report? We have had three disappointing jobs in a row? Would a fourth be it for the incumbent president? Do people wait until closer to the election, September, October?

BORGER: Right.

Well, I have been talking with smart people on both sides of the aisle, pollsters on both sides of the aisle. The Democrats tend to it happens in the fall, later. So the president has some time to get his economic message together and hopefully get some more good economic news. The Republicans that I talk to, Republican pollsters are saying people's views are getting cemented right now, that this last jobs report with anemic growth was really starting to set the trend for how people feel about the economy. They're not optimistic. And they say that is going to stick.

KING: They're both talking more and more about the economy, so time for voters, 147 days, to listen in.

BORGER: Who's counting.

KING: I'm counting.

(LAUGHTER)

BORGER: Gloria, thanks so much.

Moving on now to disturbing and very emotional testimony today in that child rape case against the former Penn State assistant football coach Jerry Sandusky. The man prosecutors call victim number five took the stand and testified Sandusky molested him in a sauna when he was just 12 years old.

The testimony went like this -- quote -- "We were sitting in the sauna, and I had my towel on. Then Jerry parted his towel."

Sara Ganim is a CNN contributor and a Pulitzer Prize-winning reporter for "The Harrisburg Patriot News."

Sara, you have been tracking this case from the very beginning, in the courtroom since the first moment of the trial. During this testimony today, victim number five got quite emotional, started to cry. Take us inside the courtroom.

SARA GANIM, CNN CONTRIBUTOR: You know, as soon as he started to cry, his mother who was a couple rows over from me started to cry as well.

He was another alleged victim who really captivated jurors. He was the fourth to take the stand and testify against Jerry Sandusky. Something a little bit different about his from other testimonies was he didn't look at Jerry Sandusky at all during that testimony.

He turned and actually spoke mostly to jurors. And in his case, he says that he had known Jerry Sandusky for several years, and there was some grooming that he alleges, but he says that incident that started in that sauna and led to a shower where he was cornered by Jerry Sandusky, he was able to squirm away as the attack was happening, and he says he put his clothes on. Jerry Sandusky didn't say a word.

He took him home and never called him again, never invited him to a single other football game or any kind of other event. Most of the other alleged victims who have taken the stand and testified against Jerry Sandusky have said that they kept going back, kept hanging out with Jerry Sandusky because that was so much fun, those football games, those events, that made them feel so good that they buried the abuse in the back of their minds and dealt with it, and this is what they're testifying to now. He was a little bit different.

KING: And at one point, Sara, the prosecutor asked this victim -- quote -- "Did you tell anyone in your family what he had done to you?" And he responded, "I didn't. I wanted to forget. I was embarrassed."

Is that a pattern you're seeing as the alleged victims begin to testify?

GANIM: Absolutely, John, that's a pattern. There are actually a lot of patterns that are emerging. Many -- all of the alleged victims that have testified so far met Jerry Sandusky through the Second Mile, during a camp, during some kind of Second Mile activity.

In all of the cases, Jerry Sandusky then called the home, and asked to speak to their mother, or father, or guardian, said I would like to hang out with your son. In all of those cases, it started with a hand on a knee during the car ride. This is what's been testified to in court.

And in some cases, that led to shared showers, which led to abuse, allegedly. And in other cases, it went to sleepovers at Sandusky's home, which led to abuse allegedly. So, they all seemed to take the same path, and all of these kids say he bought them gifts, or he took them to games before these attacks allegedly happened, and that's why they kept going back.

KING: Sara Ganim tracking this emotional and very important trial for us. Sara, appreciate it. Thank you. Check back in tomorrow.

When we return, John Edwards got just what he wanted today -- coming up, why the government decided against retrying him and dismissed all the remaining charges.

Later, today's ominous rumbling between the United States and Russia because of the fighting in Syria.

(COMMERCIAL BREAK)

KING: Former North Carolina Senator and presidential candidate John Edwards officially off the hook this evening, the Justice Department today announcing he won't be retried on the campaign finance charges a jury deadlocked on last month.

The charges, a result of Edwards' attempt to hide his affair with a campaign worker, have been formally dismissed.

Senior legal analyst Jeffrey Toobin is with us.

Jeff, probably no surprise, I guess, the remaining charges were dropped after the jury said, no, not guilty on one of them, but what do you think of this? Was this a clear-cut case? The jury deadlocked on five of these other charges. We have them up there. It's conspiracy, illegal campaign contributions. The government had to think, should we give this another try with another jury?

JEFFREY TOOBIN, CNN SENIOR LEGAL ANALYST: They may have thought about it, but I think the real question here is not whether it should have been retried, but whether it should have been brought in the first place.

This was a weak, weak case. And I think today's decision was really easy, especially since the jurors who were interviewed after the trial said, on the remaining counts, they were split, very heavily, towards acquittal.

KING: And so I think we know the answer about would it happen, but could this case somehow be resurrected?

TOOBIN: No. Double jeopardy of the Constitution, that's all she wrote. This case is over.

John Edwards, whatever else he is, is not going to be a convicted felon on these charges anyway.

KING: And one of the goals of the government was to get John Edwards disbarred. He says he wants to start this public interest law group. He still thinks, if you heard him after the day that one charge was thrown out, he said he still thinks the lord has plans for him. Can he be disbarred still?

TOOBIN: Technically, it is possible. But the way it works in North Carolina and most states is, in the absence of a criminal conviction, disbarment is very, very rare. So, I think he is in the clear on that too.

KING: So campaign finance charges are always incredibly difficult, because they're complicated to begin with.

TOOBIN: Right.

KING: What did we learn from this? What's the lesson? Let's set John Edwards aside, but any prosecutor in the future, in a high- profile case like this, have they learned new dos and don'ts, new red lines?

TOOBIN: No. In fact, I think what we learned in the Edwards case and perhaps more importantly in the Citizens United case from the Supreme Court in 2010 is that the rules that exist are falling apart, and the idea that you could criminally prosecute someone for violating campaign finance laws Is becoming more and more remote.

Campaign finance is becoming deregulated, not re-regulated, and I think criminal cases will be even more rare in the future.

KING: Well, and there's no consensus in the Congress to do anything about those laws at the moment, so I think that's probably the new status quo.

(CROSSTALK)

TOOBIN: Indeed.

KING: Jeffrey Toobin, appreciate your insights tonight. Thanks so much, Jeff.

And still ahead here: the truth about what the Obama campaign hopes we will take away from the president's big economic address tomorrow. Here is a hint. They might want you to forget something he said before.

But next, cycling legend Lance Armstrong's angry denial of new allegations involving doping.

(COMMERCIAL BREAK)

KING: Welcome back.

(NEWS BREAK)

KING: Up next: The fight against Syria sets off a new round of echoes of the Cold War between the United States and Russia.

And an Ivy League school comes under fire for admitting a woman with close ties to the Syrian leader.

(COMMERCIAL BREAK)

KING: This half-hour: shadows of the Cold War emerging, as the United States and Russia trade barbs over who is responsible for the escalating Syrian violence.

And an outpouring of anger at an Ivy League campus over the bloodbath in Syria -- why Columbia University sent an acceptance letter to a woman with close ties to Bashar al-Assad.

And remember when President Obama said he would be a one-term president if he didn't get the economy going in three years? The "Truth" about why he's hoping you forget.

We heard disturbing echoes of the Cold War today, as the Russian foreign minister, Sergei Lavrov, accused the United States of escalating its arms supplies to Syria.

(BEGIN VIDEO CLIP)

SERGEI LAVROV, RUSSIAN FOREIGN MINISTER (through translator): They are providing arms and weapons to the Syrian opposition that can be used in fighting against the Damascus government.

(END VIDEO CLIP)

KING: Here in Washington, the secretary of state, Hillary Clinton, quickly responded, saying that's not true, and she coupled that denial with a warning to the Russians.

(BEGIN VIDEO CLIP)

HILLARY RODHAM CLINTON, U.S. SECRETARY OF STATE: Russia says it wants peace and stability restored. It says it has no particular love lost for Assad, and it also claims to have vital interests in the region and relationships that it wants to continue to keep. They put all of that at risk if they do not move more constructively right now.

(END VIDEO CLIP)

KING: Wow.

Joining me now to talk about this, Fareed Zakaria, the host of CNN's "FAREED ZAKARIA GPS," and of course editor at large for "TIME" magazine.

Fareed, first and foremost, the question is, what does this mean when it comes to Syria? But then I would also like to spend some time discussing the larger issue about the icy relations now between Washington and Moscow. But when it comes to Syria, the Russians are sending arms in. Mr. Lavrov didn't deny that. Full-scale civil war, any end in sight?

FAREED ZAKARIA, CNN WORLD AFFAIRS ANALYST: No end in sight, John.

I think that the Russian case, it's funny that you start by referencing the Cold War, because in many ways what Russia sees in Syria is the last gasp of its Cold War status in the region. Syria is the last great Russian ally in the Middle East. It's the only one water port they have. It's the only entree that they have into the greater Middle East, and thus, as they see it, to their naval ambitions to be a great world power.

So, the Russians are all in with regard to Syria. And what you're seeing with Lavrov is really just a very spirited, feisty response from a very skilled Soviet -- or Russian diplomat, just presenting the best face on what Russia has decided to do.

KING: If they're all in when it comes to Syria, that means the Security Council will never be the route to get anything more done, because they can block anything there.

But what is the bigger issue here for this relationship between the United States and Russia, especially since President Putin has come back -- he didn't come to the United States for the summit where he was invited, decided not to come there. Now you see pretty clear, not only not agreeing with the United States, but being very public in disagreeing with the United States. What's at play here?

ZAKARIA: I think this is going to be an area where there's flat- out disagreement, a difference in a sense in the conception of interest. You know, sometimes you can negotiate when both sides see that they have some common interest, some win-win they can to get to.

It's difficult to see how you get to that place right now, unless the Russians are convinced that Assad's days are numbered anyway. In other words, if the Russians believe there is going to be a post-Assad future, then they will want to get out ahead and shape that future. And I think the only chance we have is to convince them that this regime cannot survive, by putting enough economic sanctions on them, by getting an international coalition together.

KING: It's tempting sometimes when you see the fraying of the U.S.-Russian relationship to think President Putin had a great relationship with George W. Bush. Maybe he's got an ax to grind with President Obama and he's waiting out the election.

But if you listen to this campaign, you remember when President Obama was overheard telling the former president, "Just wait until after the election. Maybe I'll have more flexibility on missile defense." Mitt Romney was very tough on Russia. You might remember this.

(BEGIN VIDEO CLIP)

MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: This is without question our No. 1 geopolitical foe. They fight every cause for the world's worst actors. The idea that he has more flexibility in mind for Russia is very, very troubling indeed.

(END VIDEO CLIP)

KING: Is it inevitable that there are going to be disagreements between the current president and the Russians? Governor Romney, at least on the campaign trail, sounds like he would be as tough, if not tougher with the Russians. Is this relationship going in the wrong direction?

ZAKARIA: The relationship is not -- is not headed in the right direction, but I don't think there's much the United States can do about that. I think President -- you know, Governor Romney was just pandering there. There's not much that the Obama administration has done that, frankly, is objectionable with regard to the Russians.

Russia is now a second-rate power. It's more a great power vacuum than it is a great power. So to build them up as this great geopolitical adversary of ours, I mean, their economy is in a shambles. The Russian military is in a shambles. I don't think -- they wouldn't be on my top five list as a geopolitical adversary.

KING: As always, calling it like he sees it. Fareed Zakaria, thanks so much.

ZAKARIA: Pleasure.

(END VIDEOTAPE)

KING: All of the Syria conflict is hitting a prestigious university right here in the States, in New York City. Columbia University now under fire for deciding to admit the daughter of a Syrian official with close ties to the Syrian president, Bashar al- Assad.

Here's CNN's Mary Snow.

(BEGIN VIDEOTAPE)

MARY SNOW, CNN CORRESPONDENT (voice-over): Her name is Shererazad Jafaari. Syrian human rights advocates in the United States are furious she's accepted to a prestigious program at Columbia University, angry because of her close ties to Syrian dictator Bashar al-Assad.

Jafaari is the daughter of Syria's ambassador to the United Nations. Leaked e-mail shows she appeared to have a close relationship with al-Assad, referring to him at times as handsome and cute.

She provided advice to him on his public image abroad, as Syria waged a brutal crackdown on its people and denied it.

Haya, who is Syrian and prefers not to give her full name, just graduated from Columbia School of international and public affairs. She's demanding Columbia rescind Jafaari's admission.

HAYA, COLUMBIA GRADUATE: I was surprised and disturbed by this decision. Because for me, accepting her is not a personal thing. It's accepting what's happening in Syria. It's accepting the genocide and saying that we are going to welcome people who are part of this into our school.

SNOW: Jafaari emerged in the media after ABC's Barbara Walters landed an exclusive interview with Bashar al-Assad in December. Jafaari says she helped facilitate that interview. Walters admits in the months following, she tried to help Jafaari.

In a statement Walters said, "I did offer to mention her to contacts at another media organization and in academia, though she didn't get a job or into school. The media organization was CNN, and it went nowhere."

Columbia University tells CNN its applicants are evaluated solely on the materials submitted, adding, "We understand and share concerns about the brutal regime in Syria."

Shererazad Jafaari says she was accepted to Columbia because of her qualifications. As for her relationship with al-Assad, she says she was an unpaid intern in media circles for three months, not an aide, saying, quote, "I am nothing but a victim for some personal agendas. As an ambitious graduate student in America, all I was trying to do in this very brief time was to build up my knowledge and to explore ways to successful academic options. What's going on in Syria and to my people saddens me and breaks my heart."

Activists fighting for democracy in Syria aren't swayed.

SARAB AL-JIJAKLI, NATIONAL ALLIANCE FOR SYRIA: What she represents is an outlet for the Assad regime to extend their reach outside of Syria, perpetuate false messages, false realities that are occurring within the country. She's actively taking part in this activity through her media advice.

SNOW: At Columbia, some students feel she shouldn't be denied admission.

CASSANDRA SCHWARTZMAN, GRADUATE PSYCHOLOGY STUDENT, COLUMBIA: I understand a lot of people must be upset about her prior involvement, but I don't think that that's a reason to -- to deprive somebody of having a really great education.

CARLON MYRICK, TEACHER'S COLLEGE STUDENT, COLUMBIA: If the evidence isn't conclusive or isn't damning enough, I do think that it could be potentially discriminatory to not offer her the opportunity to learn here.

(END VIDEOTAPE) SNOW: John, others feel strongly that Columbia should take a stand and rescind Jafaari's admission; have organized an online petition. So far, it has more than 900 signatures.

KING: Mary, you mentioned the family ties, but she's just 22 years old. How did it come that she's acting, essentially, as the intermediary between Barbara Walters and the president of Syria?

SNOW: Yes. You know, in e-mails today, she was downplaying her role, and she said, you know, she volunteered for it and, because of her family connections, though, she got it. And is really is so extraordinary that such a young woman would have so much influence with one of America's most famous journalists and the president of Syria.

And as for that Barbara Walters interview, Jafaari says one of the reasons why she was so involved, she calls Barbara Walters a family friend and says the fact that she spoke English also was a factor in why she was so involved. But it is pretty extraordinary.

KING: Pretty extraordinary and a bit embarrassing for Barbara Walters. Fascinating story. Mary, thank you.

SNOW: Sure.

KING: Coming up, the "Truth" about something President Obama's campaign he hopes you'll forget or at least forgive.

(COMMERCIAL BREAK)

KING: The president travels to Ohio tomorrow, the 22nd visit to the state since taking office, and the sixth just this election year. The reason is to give a major economic speech.

Now, we're told to expect a candid assessment about the economy's struggles and the sharp contrast with Mitt Romney over ideas to create -- to create, excuse me, as many jobs as possible as quickly as possible.

Boil it all down and truth is, the major goal of this speech is to try to get voters to forgive or forget this statement the president made just after taking office.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: A year from now, I think people are going to see that we're starting to make some progress, but there's still going to be some pain out there. If I don't have this done in three years, then there's going to be a one term proposition.

(END VIDEO CLIP)

KING: That was February 2009. When he said that, the president, of course, did not fully understand how deep the ditch was. Nor could he have predicted the European and other economic head winds that drag at our economy now. But he did say it.

(BEGIN VIDEO CLIP)

OBAMA: If I don't have this done in three years, then there's going to be a one-term proposition.

(END VIDEO CLIP)

KING: And he's a politician. He knows it is more than fair to hold the president or any politician accountable for their statements and their promises.

Another favorite Romney and Republican poke these days is at the president's broken promise to cut the deficit in half in four years. President Obama takes issue with that.

(BEGIN VIDEO CLIP)

OBAMA: It's like somebody goes to a restaurant, orders a big steak dinner, martini, all that stuff, and then just as you're sitting down, they leave. And accuse you of running up the tab.

(END VIDEO CLIP)

King: The president's point there, the Republicans left him a pretty big deficit, right? Here are the numbers in that fight.

The national debt rose by $4.9 trillion under the eight years of the George W. Bush presidency. It has gone up by slightly more than that, a little over $5 trillion so far in President Obama's first term.

And as the president tries to offer explanations, Governor Romney sees only excuses.

(BEGIN VIDEO CLIP)

MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: He will speak eloquently, but the words are cheap, and that the record of an individual is the basis upon which you determine whether they should continue to hold onto their job.

(END VIDEO CLIP)

KING: Now, my take is we benefit more from a debate and a discussion about what to do next year, not who's to blame for what happened last year or the year before or the year before or the year before.

With both candidates in battleground Ohio, it would be a good day and a pretty good place to be more forward looking. But don't bet on it.

Here to talk truth tonight, "The New Yorker's" Washington correspondent and CNN contributor Ryan Lizza; Republican strategist Nancy Pfotenhauer; and Democratic strategist and CNN political contributor Maria Cardona.

Ryan, I'm going to start with you before we get the partisans involved here. The president's challenged. He did say that. And look, he can say, "The recession was worse. I didn't know what was going to happen in Europe. The Republicans in Congress won't hand me a tissue when I sneeze." And all of that's true.

However, he's the incumbent president of the United States. How does he get out of that? And he's on the record saying, "Check me out in three or four years. Otherwise, it's a one-term proposition."

RYAN LIZZA, CNN CONTRIBUTOR: The incumbent president, and throughout history, incumbent presidents, voters when they go to the polls, they judge -- they make a judgment about -- a retrospective judgment based on the economy over the last year. That's most often what happens when an incumbent is up for re-election.

I think he's made -- one big mistake that they made that comment gets at, is they did not prepare the American people for how bad this recession was going to be.

It was known at the time in 2009 that post-financial recessions -- excuse me, post-financial crisis recessions are deep and long, and they last at least five years before they -- things start to get better. I don't think the White House ever got that messaging right.

The other thing is, there's a lot of pressure. I did some reporting about this in the last few weeks, about what Obama's second term agenda is going to be if he actually wins. There's a lot of pressure on these guys from the political consultants to come up with something new and exciting, something they can talk about tomorrow.

And the policy guys say we laid everything out in the last few years. So we've got, you know, we've got this stuff that's just stuck in Congress, but you know, I think as you said to me before, John, the first three words in news are new. When we cover something, we want there to be something new, and the policy guys say, "You know what? We already put everything out, put it out in the State of the Union." I don't think we're going to hear a whole lot new.

KING: Is recycling, even if they find a nice way to package it, going to satisfy? You know, more and more, some of them very publicly like our friend Mr. Carville, some of them privately, have a case, I call it the jitters. The either disagree with the president's strategy. They don't see bold; they see problems.

MARIA CARDONA, CNN POLITICAL CONTRIBUTOR: I think what the president needs to focus on, and I agree with Ryan in that, you know, the voters will go in and assess what this president has done, but what they will also do, and what the president needs to continue to do, is to make sure that's not all they do, that they also compare it with what the other guy is saying and what the other guy has done in, you know, whatever -- whatever issues he has done in the past, whether it's head of Bain or as head of -- of Massachusetts as governor.

And so it becomes a choice. And when you have it as a choice, then I think President Obama has a lot to talk about, even though a lot of what his plan is stuck in Congress. He can talk about what that plan would do if the Republicans would just work with him.

Independent economists have said that that plan in Congress would create over a million jobs. No independent economist has said that Mitt Romney's plan would create jobs. In fact, they will say it would blow a $5 trillion hole in the economy. So these are the things that President Obama needs to talk about.

KING: She's talking about the tax cuts debate, though, when she talks about the hole in the economy.

Answer as you wish. But let me ask the question this way. Sometimes it's a choice. Sometimes it's a referendum on the incumbent, no matter how good they are, trying to make that choice. The voters decide that; we don't.

But to the point that if it is a choice, President Obama's case essentially is it's four more years of George W. Bush. That's when this mess started. The policies are no different. Has Governor Romney done a good enough job of telling the American people, "Sure, maybe here's where I'm the same, and here is where I'm different."

NANCY PFOTENHAUER, REPUBLICAN STRATEGIST: Well, I think that he will get that type of attention now, have that opportunity. And I think he's more than prepared to do it. I think this election is about jobs and the economy and the overspending in government, that that's a good outcome for the Republicans.

That's where Romney has consistently shown his strength. I think polling numbers back it up. If an incumbent president, his best line is "can we get this to a choice," that he is in serious trouble. Incumbents are supposed to be going in with major face cards. He is struggling because he's going in with some of the worst job numbers that we've seen in modern history.

When people say 8.6, 8 percent, in that range, it actually is understated by about 3 percent because of the fact that people have given up and stopped looking. Historically, if you're at 10 percent or higher, that impacts presidential elections, and I think it will.

LIZZA: Best thing about this -- these dueling speeches, the conversation we're having here, is we're not talking about Romney's dog.

PFOTENHAUER: Right.

LIZZA: You know, sort of the gaffes. And they're going to have starting tomorrow, I think we're getting into a phase where we're going to compare the records, we're going to start comparing their vision for the country, and that's a much better debate to be having.

KING: Amen. And I hope that they spend more time on those issues, forward looking as well as backward looking. And we have a responsibility to do this.

Hang on, everybody. We'll continue the conversation in just a minute.

"ERIN BURNETT OUTFRONT" coming up at the top of the hour.

Erin, you were watching today, JPMorgan Chase CEO Jamie Dimon, up in the Senate Banking Committee. He apologized -- had to apologize. His company lost billions of dollars on a bad bet. But the question is, is that just it, "I'm sorry, see you later"? What happens now?

ERIN BURNETT, CNN ANCHOR: Well, I mean, that's the big question, John. Everyone said, "Look, we had Dodd-Frank. How could this have happened? Could it happen again? And it seems the answer is yes.

Some amazing numbers as you break this down, John. But 48.5 percent. That's how much bigger JPMorgan is today than it was before the financial crisis. That's a pretty stunning number.

The assets of JPMorgan are about 15 percent of the size of the entire U.S. economy. We've gone from too big to fail to too big to bail. The only thing worse than not being able to bail out a bank that's going to fail is -- having to do it, is actually not being able to do it and bring down the whole U.S. economy. And that may be sort of the Canary in the coal mine that we're actually seeing right now.

KING: Too big for me to count, I think, at this point.

BURNETT: Yes.

KING: Erin, looking forward to it. We want to watch you connect the dots. We'll see you in just a few minutes.

And still ahead here, JetBlue, fliers like you. See what other airlines top the list when it comes to customer satisfaction.

And move over Obama Girl. There's a new YouTube star who has a crush on the president. Hear why Obama Boy is so enamored. After this.

(COMMERCIAL BREAK)

KING: Spent a lot of time in recent weeks asking a question, is Bill Clinton somehow trying to undermine President Obama? He insists no. But as the president tries to make his case on the economy in recent days, if you listen, it seems like Bill Clinton is his BFF.

(BEGIN VIDEO CLIP)

OBAMA: We have taken a surplus left behind by President Clinton and turned it into deficits as far as the eye can see.

Bill Clinton described it well the other day. He said they want to do the same thing, just on steroids. Remember, when the last Democratic president was in office, we had a surplus.

(END VIDEO CLIP)

KING: Why is he doing that? Let's continue the conversation. Ryan Lizza, Nancy Pfotenhauer and Maria Cardona.

They're buddies, right? I assume he doesn't mind being associated with Bill Clinton, because you had 22 million jobs, I think, over those eight years?

CARDONA: Absolutely. It was also the biggest economic expansion that we've had in 50 years. And on top of that, the policies that President Obama is pushing are very similar to the same policies that President Clinton pushed and that actually got us to that big, robust economic growth.

And so, again, we go back to it's a choice. President Obama needs to talk about -- continue to talk about President Clinton and he wants to do things that are very similar. That will actually put the first class -- the middle class first. It is the difference between an economy by, of and for the top 1 percent and the wealthiest and the biggest corporations, or an economy that is all about the middle class and workers and protecting a robust growth for that middle class.

KING: Are they the same?

PFOTENHAUER: Not at all. And just -- I have to respectfully disagree. You basically had, you know, then President Clinton who reformed welfare and who said the end of big government -- the era of big government is over.

The policies that are being advocated now are unbelievable levels of spending. And Bush -- Bush deserves some blame for that, as well. He spiked it up. But Obama has kept it up.

Incredible increases in regulations and even more proposed. And you've also seen, you know, tax policy that has the economy and has basically people with capital feeling very uncertain and refusing to invest.

So I think it's a big problem, and I think he's hugging Bill Clinton so tightly because independent voters like Bill Clinton and they're not really turning to him.

KING: Does that get you both to say nice things about Bill Clinton?

LIZZA: Clinton is popular, but the evolution of the Clinton/Obama relationship is just fascinating.

PFOTENHAUER: Fascinating.

LIZZA: If you read Obama's book from 2006, he talks about the '90s in a dismissive way. He talks about Gingrich and Clinton, those battles to him. He uses the phrase psycho drama of baby boomers playing out.

And his campaign against Hillary Clinton, the subtext of that campaign in the primaries was that the Bush years and the Clinton years weren't that different. Do you remember that? We kind of forget that. Now I think he's in office in a much more partisan environment. You looks back at what Clinton had to deal with. I don't think he thinks that those battles, as he once put the battles, were psycho dramas. I think they were ideological dramas, and he's having the same ones now. He has a lot more sympathy for Clinton.

CARDONA: I have to respond to one thing that Nancy said. Spending growth under President Obama, the smallest spending growth since President Eisenhower. So I mean, that's a big myth that Republicans like to put up.

KING: There's a huge debate over how much the recession plays into that. And (UNINTELLIGIBLE), everything else.

PFOTENHAUER: Only if you don't really measure spending.

(CROSSTALK)

CARDONA: That was a report that was put out there by CBS Marketwatch, though. I mean, you know, again, that is about the choice and about the reality of the situation. Because that is something that you need to talk about. The hole that was handed to President Obama. He didn't start from a level playing field.

PFOTENHAUER: But he keeps advocating the same thing. And the definition of insanity is to do the same thing and expect a different reaction.

CARDONA: The same thing that President Clinton...

(CROSSTALK)

LIZZA: The big change in Obama's message -- the big change in Obama's message is the big theme of 2008 was changing Washington, getting past partisanship. Now his message is...

CARDONA: He tried.

LIZZA: ... you're involved in an ideological fight, and one side has got to win.

CARDONA: He tried to work with Republicans. He tried to work with Republicans, got slapped down every single time.

KING: I think there's equal -- there's equal blame to go around on the not making Washington work part of it. Maria, Nancy, Ryan, we'll continue the conversation another day or you guys can continue it right now, but I've got to get to Kate Bolduan, who's got the latest news you need to know right now.

Hey, there.

KATE BOLDUAN, CNN CORRESPONDENT: They are not going to stop, I can tell you that.

Thank you, John. Good evening again, everyone.

A decline in retail sales usually is considered bad news, but the government's latest report shows retail sales fell 0.2 of a percent in May because gas prices went down. Compared to April, consumers spent a billion dollars less at the pump last month. Take the silver lining where you can get it.

Airline CEOs, take note. Passengers really do not like paying extra, especially to check their luggage. Low-cost carriers JetBlue and Southwest Airlines have the highest marks in a new customer satisfaction survey by J.D. Power and Associates. And guess what? They still do not charge you for checking a bag or two. U.S. Airways, if you wanted to know, landed at the bottom of the list.

And the jury has quit for the day without reaching a verdict in the trial of former pitcher Roger Clemens. He faces one count of obstruction of Congress, three counts of making a false statement, and two counts of perjury for repeated -- his repeated denials for using performance-enhancing drugs. Clemens has pleaded not guilty.

And the queen continues to celebrate her Diamond Jubilee. They just can't get enough. Today in Nottingham, she was joined by her grandson, the Duke of Cambridge, and his wife, Catherine. They were all on hand at a park that will be preserved in honor of the queen's jubilee. William and Kate -- you can see them there -- participated in sports events with some kids. The duchess and duke both threw foam javelins, and she helped build a tent.

And we're probably going to see much more of them as the Olympics are right around the corner.

KING: I like the javelin toss.

BOLDUAN: We can bring that...

KING: This is an unending party. Isn't it?

BOLDUAN: It's how I like to celebrate, but no one comes to my parties.

KING: All right. Stay put, Kate. Here we go. I need your help. Tonight's "Moment You Probably Missed" shows how much the times, well, they are a changing.

(BEGIN VIDEO CLIP)

AMBER LEE ETTINGER, OBAMA GIRL (singing): Because I've got a crush on Obama. Barack Obama baby, you're the best candidate.

(END VIDEO CLIP)

KING: One of the highlights of the 2008 presidential campaign were these viral videos posted by a woman who became known as the Obama Girl. Her real name, Amber Lee Ettinger. According to Politico, she says she's not sure who she's going to vote for this year.

No problem. Here comes the 2012 sequel. Obama Boy, riffing on the president's support for same-sex marriage.

(BEGIN VIDEO CLIP)

JUSTIN BROWN, OBAMA BOY (singing): I've got a crush on Obama Barack Obama. You're the finest candidate.

(END VIDEO CLIP)

KING: Politico identifies Obama Boy as a Brooklyn-based producer and actor named Justin Brown. And I guess you had to expect that. Thank God for the Internet, right?

BOLDUAN: I mean, I've got to love it. There was actually one thing last week I think that we saw. It was someone mashing up the president speaking doing the Carly Rae Jepsen song. I love this stuff.

KING: OK, good. You can become our new Internet Obama whoever, Romney whatever monitor. It's all yours.

BOLDUAN: Add that -- yes, add that title to the list. Thank you.

KING: Thanks, Kate. Have a good night. We'll see you right back here tomorrow night, same time, same place. "ERIN BURNETT OUTFRONT" starts right now.