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STARTING POINT WITH SOLEDAD O'BRIEN

Obama vs. Romney: Heated Rematch; Post-Debate Analysis; Armstrong Steps Down From Live Strong Foundation; Pharmaceutical Company Linked to Meningitis Deaths Under Investigation; Interview with Debate Moderator Candy Crowley; Housing Bright Spot; Parties Come Together to Build

Aired October 17, 2012 - 08:00   ET

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


(COMMERCIAL BREAK)

SOLEDAD O'BRIEN, CNN ANCHOR: Good morning. Welcome, everybody.

Our STARTING POINT this morning, heated rematch. President Obama, Mitt Romney tackled the issues in their second debate. Neither side held back this time around. Listen.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Governor Romney doesn't have a five-point plan. He has a one-point plan.

MITT ROMNEY, (R) PRESIDENTIAL NOMINEE: Why am I lowering taxes on the middle class? Because under the last four years, they've been buried.

Have you looked at your pension?

OBAMA: No, I don't look at my pension. It's not as big as yours.

(END VIDEO CLIPS)

O'BRIEN: And there was this moment that could mark a turning point. Listen.

(BEGIN VIDEO CLIP)

ROMNEY: It took him four days before he called it an act of terrorism.

OBAMA: Get the transcript.

CANDY CROWLEY, DEBATE MODERATOR: He did, in fact, sir. So let me call it an act of terror --

OBAMA: Can you say that a little louder, Candy?

(END VIDEO CLIP)

O'BRIEN: We're keeping the candidates honest, separating fact from fiction, looking ahead to the final debate, which takes place on Monday in Florida.

This morning, we talk to Robert Gibbs. He's a senior adviser to the Obama campaign. Wisconsin Senator Ron Johnson is going to join us. CNN's Candy Crowley, the debate moderator from last night's debate, will be with us to talk about how that went.

And Ty Pennington who will remember created that house, half of it was built at the RNC, half was built at the DNC. Well, they finally put it together and handed it off to a worthy military family. He's going to talk about how that went and the family members, too.

Wednesday, October 17th. And STARTING POINT begins right now.

(MUSIC)

O'BRIEN: Good morning. Welcome, everybody.

Our STARTING POINT is the Obama/Romney rematch. Last night's Long Island debate had everything the first encounter lacked. This time, it was the president fighting back. The two candidates slugging it out in what was a very tense town hall debate.

In a CNN/ORC poll of registered voters who watched the showdown, the president came out on top 46 percent to 39 percent who felt that Mitt Romney won.

Dana Bash is with us. Nearly three out of four voters said that the president exceeded their expectations. Maybe that's not such a shocking poll, considering how badly he did the first time around.

DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT: Exactly. It's much easier when your expectations are low. But there's no question that the president came to play. Mitt Romney did as well. There were times where they almost looked like they were physically stalking each other. They certainly talked over each other and tried to talk over Candy Crowley. It was an electric night for 90 minutes straight.

(BEGIN VIDEOTAPE)

BASH (voice-over): You may think the debate in front of undeclared, persuadable voters would produce polite performances -- ROMNEY: On government land is down.

OBAMA: Production is up. No, it isn't.

BASH: -- think again.

ROMNEY: In the last four years --

BASH: At times, this town hall looked like a school-yard brawl.

OBAMA: Not true, Governor Romney. That's not true.

ROMNEY: So how much did you cut them by? I had a question and the question was how much did you cut them by? How much did you cut them by? OBAMA: I'm happy to answer the question.

BASH: If memorable debates are about moments, one here was on Libya.

UNIDENTIFIED MALE: Who was it that denied enhanced security and why?

BASH: It was the question conservatives were waiting for. A chance to slam the president for lax security and changing stories on what prompted last month's deadly Benghazi attack.

ROMNEY: And there was no demonstration involved. It was a terrorist attack. I think you have to ask yourself, why didn't we know five days later when the ambassador to the United Nations went on TV to say that this was a demonstration? How could we have not known?

BASH: The president threw down the commander-in-chief card.

OBAMA: And the suggestion that anybody in my team would play politics or mislead when we've lost four of our own, Governor, is offensive. That's not what we do. That's not what I do as president, that's not what I do as commander-in-chief.

BASH: Romney's offensive on national security did not go as planned.

OBAMA: The day after the attack, Governor, I stood in the Rose Garden and I told the American people and the world that we are going to find out exactly what happened. That this was an act of terror.

ROMNEY: On the day after the attack he went in the Rose Garden and said this was an act of terror. You said in the Rose Garden the day after the attack it was an act of terror.

OBAMA: Get the transcript.

CROWLEY: He did, in fact, sir. So, let me -- let me call it an act of terror.

OBAMA: Can you say that a little louder, Candy?

BASH: Throughout this debate, the president tried to make up for the first one. This time, he used the 47 percent attack line.

OBAMA: When he said behind closed doors that 47 percent of the country considered themselves victims, who refuse personal responsibility, think about who he was talking about.

BASH: And Romney who dominated the stage in the first debate was going for a repeat performance.

ROMNEY: You'll get your chance in a moment. I'm still speaking. And the answer is I don't believe people think that's the case because that was not the question.

OBAMA: OK.

ROMNEY: That was a statement. BASH: But in an attempt to reach the critical vote may have fallen flat, he answered a question about equal pay with a story about searching for women in his Massachusetts cabinet.

ROMNEY: I went to a number of women's groups and said, can you help us find folks? And they brought us whole binders full of women.

BASH: Within minutes, @RomneysBinders had its own Twitter handle.

The president went after Romney as a flip-flopper.

OBAMA: Governor, when you were governor of Massachusetts, you stood in front of a coal plant and pointed at it and said, "This plant kills," and took great pride in shuttling it down. And now, suddenly, you're a big champion of coal.

BASH: Romney determined to use his rehearsed lines, even when they were off topic. The question was on immigration but Romney launched into a defense of his offshore investments with a practice pivot against the president.

ROMNEY: Any investments I have over the last eight years have been managed by a blind trust and I understand they do include investments outside the United States, including in Chinese companies. Mr. President, have you looked at your pension? Have you looked at your pension?

OBAMA: I've got to say --

ROMNEY: Mr. President, have you looked at your pension?

OBAMA: I don't look at my pension. It is not as big as yours so it doesn't take as long.

ROMNEY: Let me give you some -- let me give you some advice.

(END VIDEOTAPE)

BASH: That was definitely a moment. There was no question about it. And it was also a reminder of how, again, physical it was, Soledad. Romney approaching the president and going, you know, towards him as he was talking to him, the kind of thing that talking to debate coaches who were inside the campaign and even outside said that they were cautioning against because it makes the viewer and more importantly voter feel really uncomfortable.

O'BRIEN: We spoke about that last night, right? You have the audience, which is the town hall, which is in this little encircled area. Then you have the people watching the town hall but in the room. Then you have the people who are watching on television, watching the town hall on TV. And those are very different audiences where sort of body positioning, space and how you're acting to someone all kind read differently.

BASH: And if you look at both candidates, they both sort of did use the floor. Neither was sitting on his stool for very long. They both really did approach each other. I think the governor went maybe this much closer in the personal space.

JOHN BERMAN, CNN ANCHOR: Looked like a gladiator ring.

O'BRIEN: Much more tough than I thought a town hall would be. Town halls are usually kind of -- I think very rarely are you yelling at people in town halls but not last night.

Let's bring in Robert Gibbs. He's a senior adviser to the Obama campaign, former White House press secretary.

Nice to have you with us this morning.

ROBERT GIBBS, OBAMA CAMPAIGN SENIOR ADVISER: Good morning. How are you guys?

O'BRIEN: We'll talk about polls. I'm well. Thank you for asking.

We talked about, you know, CNN/ORC, it looks as if President Obama won the debate, 46 percent to 39 percent. But when they actually sort of broke down, you know, dug deep into that, you actually saw that Mitt Romney won in a lot of questions in the polls.

I mean, here is a list of them. Who better handled the economy? Romney, 58 percent, Obama, 40 percent.

Who would better handle health care? Romney, 49 percent, Obama, 46 percent.

I think you have -- you cannot look at some of these breakdown polls and feel that last night was a huge victory in those particular areas.

GIBBS: Two points I would make. One wolf made last night, which is the poll was about an 8 percent to 10 percent more Republican sample than the normal CNN polls.

And if you look at that question, "Who do people in the poll think is better to handle the economy?" before the debate, Mitt Romney had even a greater lead. So, the people that watched that debate last night --

O'BRIEN: Who gave the president a victory, gave him a --

(CROSSTALK)

GIBBS: No, no, but if you look at where Mitt Romney started that debate with the answer on who was going to be better on the economy and then after an hour and a half, that number decreased significantly.

So, I think -- look, I'm enormously pleased with the president's performance and I think undecided voters saw a commanding, in-charge president that talked specifically about what he's done and what he wants to do to move this economy forward and continue to strengthen it. And I think, without a doubt, his strongest answer was on national security and Libya. And I think --

O'BRIEN: Let's play some of that. Of course, that created a big moment of the night last night.

GIBBS: Sure.

O'BRIEN: And it's one that this morning we're seeing a lot of, certainly, spinning on the GOP side, interpreting what Candy said.

So, first, let's play what happened in the debate last night.

(BEGIN VIDEO CLIP)

OBAMA: The day after the attack, governor, I stood in the Rose Garden and I told the American people and the world that we were going to find out exactly what happened and that this was an act of terror. And I also said that we're going to hunt down those who committed this crime.

ROMNEY: I want to make sure we get that for the record because it took the president 14 days before he called the attack in Benghazi an act of terror.

OBAMA: Get the transcript.

CROWLEY: He did, in fact, sir. So let me call it an act of terror.

OBAMA: Can you say that a little louder, Candy?

CROWLEY: He did call it an act of terror.

(END VIDEO CLIP)

O'BRIEN: So, Candy went on, though, to say, "It did take two weeks or so for the whole idea of there being a riot out there and this tape to come out, you are correct about that." She is speaking to Governor Mitt Romney. You are correct about this two-week thing.

Today, Paul Ryan who was on "Good Morning America" a little bit earlier, said this, that Candy backtracked from her statement, her correction, that correction where she basically said, yes, he did call it an act of terror.

Are you concerned that this framing it as a backtrack is going to be problematic? She was saying the two-week thing is absolutely true.

GIBBS: No, because, look, I think if you look at what the president said in the Rose Garden on the 12th, there are two incidents where he talks about acts of terror. It's clear he's talking about a whole host of things, including what happened in Benghazi.

Look, I have watched the Republicans try like Olympic gymnasts to do whatever they needed to do to try to politicize this issue. Governor Romney has wanted to ask this question of the president apparently for more than two weeks. He has handled this as poorly as any prospective commander-in-chief has ever handled a series of national security questions.

And I think it demonstrated the real strength of the president last night in answering that question. And in watching, you know, 70 million people likely watching Mitt Romney's facts corrected on the air because he was nothing short of wrong.

I think it was far and away the president's strongest answer. I think Mitt Romney looked very unbalanced.

O'BRIEN: (INAUDIBLE) specifically on the quote, he did use the word acts of terror. But as you know, going through the timeline. And again, we should just tweet this timeline or the chunks of it that we have out to people. We know that Jay Carney did mention reaction to the movie, the protests we're seeing in the region. The movie was mentioned. That was September 13th. There's a list of countries. We know where the movie was an issue.

We do know that Susan Rice on "Meet the Press" talked specifically about spontaneous reaction to what had transpired hours before in Cairo, copycat. So --

GIBBS: Soledad, the president in the Rose Garden says, "No acts of terror will ever shake the resolve of this great nation." The next day the president says, "I want people around the world to hear me. To all those that would do us harm, no act of terror will go unpunished."

Later that day on the 13th, "No act of terror will dim the light of our values." He goes on to talk about the fact that whoever did this, whoa will hunt them down, hold them responsible."

The president was clear on this. And again, watching Republicans trying to politicize this issue, even as the ambassador's own father has said, what we ought to find out what happened but not make this a political football back and forth.

I think Mitt Romney, again, he's handled this thing enormously poorly from his very first response all the way through this debate. He doesn't look like a strong commander-in-chief. Every time he's walked out on what is supposed to be the world's stage, whether it was his foreign trip, whether it was reaction to this in Libya, whether it was this question tonight, Mitt Romney has proved to the American people that he is not a strong commander-in-chief.

He won't be a stronger commander in chief. He's not ready to be America's commander-in-chief.

O'BRIEN: So, let's run a chunk about immigration. Last night, President Obama talked about Mitt Romney calling the Arizona law a model of immigration. I want to play that chunk before I clarify what specifically Governor Romney has said.

(BEGIN VIDEO CLIP)

OBAMA: He called the Arizona law a model for the nation. Part of the Arizona law said that law enforcement officers could stop folks because they suspected maybe they looked like they might be undocumented workers. And check their papers. You know what? If my daughter or yours looks to somebody like they're not a citizen, I don't want -- I don't want to empower somebody like that.

(END VIDEO CLIP)

O'BRIEN: Governor Romney, when given the opportunity said what I said was the E-verify portion. If you look back at his transcript, he very clearly called the E-verify portion of the Arizona law, which would allow the employers to determine if somebody is in the country legally or not legally, you know, that would be helpful. That's literally what he said.

So, isn't the president very much mischaracterizing his position on the Arizona law?

GIBBS: No. Look, again, I think as the president says in his answer, Mitt Romney's chief immigration adviser is the Secretary of State of Kansas, who wrote the Arizona law. It's an Arizona law that, again, Mitt Romney was enormously proud of during a primary in which he was trying to beat everybody as the strongest, most anti-immigrant candidate out there. You saw what he did to Rick Perry, you saw what he did to Newt Gingrich on this issue. Look, Soledad --

O'BRIEN: He called it a model. He was talking about e-verify.

GIBBS: I think he was actually talking about the law. I think he was very clear on that. And I think, look, this is classic Mitt Romney, right? He is doing whatever in an election he needs to do, to say what he needs to do, to whatever audience is in front of him -- he's a deal closer.

O'BRIEN: He is talking about e-verify. It's clear. He was saying, he said, "I think it's a model, e-verify." It was very clear.

GIBBS: I know that's exactly what Mitt Romney has tried to say ever since he said it was a model.

O'BRIEN: Now I'm a GOP spokesperson. Oh my god.

GIBBS: No, no, look, I'm not John Sununu. Please don't confuse me with the angry governor from New Hampshire.

O'BRIEN: There is only one Governor Sununu.

GIBBS: I was going to say, he's one of a kind. They rightly and deservedly broke the mold soon after. I'm not John Sununu, but I want to be clear. Mitt Romney has had - Mitt Romney will tell whatever audience they want to hear on immigration reform. And what you're seeing now and when you saw last night is a governor who, he won this nomination by being the single most anti-immigrant candidate out there and proud of it. Now what he wants to do in front of 70 million in a debate is say, no, no, no, I don't have any of these positions. I have these way different positions.

O'BRIEN: But my job is to read the actual verbiage of what he said, and when he said a model, he said e-verify.

GIBBS: I understand, Soledad. My job is to make sure that people understand that what they see in Mitt Romney in the primary, when he was trying to win this nomination, and now he's trying to do in the general election is pretend like he didn't take any of those positions. He's trying to be a wolf in sheep's clothing and let me tell you this, and I'll tell this to everybody who's watching this show and everybody who's watching these debates: he is trying desperately to change himself and change his appearance in these debates. He's become a political chameleon.

But make no mistake about it. What he said during the primary, that he's a severe conservative, that he wants self-deportation, that he has no desire to do comprehensive immigration reform, that's the candidate that - that's the true position of these candidates. That's the true position of Mitt Romney. What Mitt Romney wants you to believe in these debates, I don't have a big tax cut. Cut the taxes for the rich? What are you talking about? I've got a comprehensive immigration reform. I'm all for it. I've got a health care form that covers pre-existing conditions. I love teachers. We ought to hire more of them. Last night, saying, "I don't want companies to make decisions about contraception for women." Again, completely walking away from the very position that he'd taken on that issue.

And, look, Mitt Romney is, he's a deal closer. When he walked into those Bain deals, he would tell employees at those companies, "Don't worry. Your job is going to be fine just like your health care and your pension." And he left those meetings and the deal got closed and those people lost their jobs, they lost their health care and they lost their pension.

O'BRIEN: Bain wasn't brought up last night. I wonder - well, we're going to talk foreign policy, I guess, in the third debate, so that probably will not be something that's brought up in the next debate. Robert Gibbs is a senior adviser for the Obama campaign. It's nice to have you with us. We appreciate it.

GIBBS: Thank you. It's nice to be here.

O'BRIEN: And as we mentioned this morning, the vice presidential candidates are making the rounds, putting their spin on the debates. We were talking about Paul Ryan a moment ago. Joe Biden was talking to the "Today" show. Here is what he said.

(BEGIN VIDEO CLIP)

REP. PAUL RYAN, (R-WI) VICE PRESIDENTIAL NOMINE: Well, he clearly changed his tactic. They said that he would change his tactic, but his answers didn't change. He didn't offer any new idea about how the next four years would be any different than the last four years.

JOE BIDEN, VICE PRESIDENT OF THE UNITED STATES: And the thing that amazed me the most was even after three debates, his two and my one, there still is not a single specific in the Romney $5 trillion tax plan. There is -- I mean, everything is -- everything is sketchy.

(END VIDEO CLIP)

O'BRIEN: That's interesting, they use the word "sketchy", which is a repeat of the word that the president used last night, sketchy. I bet we're going to see that a little bit more as well.

All right, other stories that are making news, believe it or not, that don't involve last night's debate, John Berman's got a look at that. Also some breaking news for us.

BERMAN: We do have breaking news, Soledad. Big news about Lance Armstrong. He is stepping down as chairman of his Live Strong charity. The legendary cyclist, he is embroiled in a doping scandal, and last week the U.S. Anti-Doping Agency released a scathing report accusing him of cheating when he won his seven Tour de France titles. Armstrong has denied the allegations, you know, thousands of pages of allegations, including witness testimony. We'll keep you updated on this story as it develops.

Another developing story we're watching: the U.S. embassy in Stockholm has been evacuated this morning over a security scare. Police say a suspicious envelope containing white powder sparked the scare. All employees are accounted for. The envelope with that white powder is being investigated at a secure location right now.

George Zimmerman, the man accused of killing Trayvon Martin, will be back in a Florida courtroom in front of a new judge. Judge Debra S. Nelson replaces Judge Kenneth Lester after an appeals court granted the defense's request that he be replaced. Zimmerman's lawyer accused Lester of making disparaging remarks about his character. Zimmerman faces second-degree murder charges.

And in the world of sports, the Detroit Tigers on the verge of a sweep in the American League Championship Series. They are now up 3 games to none, as in not any wins for the Yankees. The Tigers beat New York 2-1 behind their ace, Justin Verlander.

O'BRIEN: That's unnecessary.

BERMAN: Justin Verlander, he spun a gem yesterday. The Tigers wrap up the series tonight with a win. If they win game four, that will earn them a berth to the World Series.

O'BRIEN: I've never disliked anybody as much as I disliked Justin Verlander.

BERMAN: He's really good.

O'BRIEN: I know and he is really good and it's killing me. As we were in the middle of the debate, of course, people were tweeting what was happening.

BASH; Soledad was doing play by play.

BERMAN: Raul Ibanez, the hero of the last playoff series for the Yankees, struck out with two strikes in the bottom of the ninth.

O'BRIEN: My sons are dying. Come on, Raul. Help us out here! All right, we'll see what happens. Well, one more game. When is that?

BERMAN: Maybe just one more game.

O'BRIEN: When is it? When's the fourth game?

BASH: Are you excited?

BERMAN: Game four tonight.

O'BRIEN: Tonight, okay. We'll see. We'll pray.

Ahead on STARTING POINT we continue our post debate coverage. You just heard from the president's senior adviser, Robert Gibbs. Up next, we're going to talk to the other side. Wisconsin Senator Ron Johnson will be joining us.

(COMMERCIAL BREAK)

O'BRIEN: Morning. Welcome back, everybody. Our team this morning: Roland Martin is a CNN political analyst. He got very little sleep last night. Ron Brownstien, the editorial director of "National Journal". He got virtually no sleep last night. Republican Congressman Jason Chaffetz from Utah was there in Long Island with us.

ROLAND MARTIN, CNN POLITICAL ANALYST: He went to bed early.

O'BRIEN: He got no sleep last night. Also joining is, Wisconsin Republican Senator Ron Johnson. He's a Romney surrogate. Nice to have you with us.

SEN. RON JOHNSON, (R) WISCONSIN: Good morning.

O'BRIEN: John Berman sticking around from "EARLY START". He probably got less sleep than all of us this morning. It's great to have you. Ahead we're going to be chatting a little bit about the debate last night, obviously. And also we'll talk to CNN's Candy Crowley because now her role in the debate is what's coming under fire from Republicans.

Let's begin with who won. Would you say it was a definitive victory for Mitt Romney? Because I've heard now a number of Republicans say it was definitive. It doesn't match what the polls are saying.

JOHNSON: I mean, we take both debates in total. To me, the one salient fact is that in order to pass any of these proposals -- forget all the details, you're going to have to get them through Congress. What Mitt Romney has demonstrated in showing the American people that he is a man that actually has been able to work with the other side. In Massachusetts, he had -- allegedly there was 87 percent Democrat, and he's actually taken $3 billion deficit and turned that into $2 billion rainy day funds. So he's actually able to work the other side whereas this president, his record is that he is not been able to do that.

When he had his - the first two years when he had total control, he didn't pass immigration reformbut he jammed through on a very partisan basis the stimulus, the health care law, Dodd-Frank. Then when he was faced with a divided government, he's been AWOL. He simply has not been able to work with anybody in Congress, Republican or Democrat. He really does not have working relationships with anybody. And evidence of that fact is his last two budgets have been voted on three times now in Congress. Final vote tally, 0-610. That is a stunning repudiation of his leadership.

O'BRIEN: So that makes you an excellent Romney campaign surrogate. However, the question was who won? And I'm guess I'm asking --

JOHNSON: So again, I think Governor Romney won because he continued --

O'BRIEN: The polls would say no.

JOHNSON: He continued that momentum. Now I would say when you take a look at your CNN poll and said that Romney bested Obama 58-40 on the economy, that is the issue of the day. I mean, I think that's pretty clear.

MARTIN: In that same poll, though, they said who would better handle the middle class? President Obama beats Mitt Romney. And both of them focused on the middle class that entire debate, and so that's also when that exact same poll says.

JOHNSON: But we also need to understand that when you grow the economy, and if you're -- you're the one that's evaluated you're better at growing the economy, that's what's actually going to help the middle class.

MARTIN: But helping the middle class goes beyond just the economy. It also goes to health care, education, other issues as well. So I'm simply stating exactly what the poll said. The poll was very clear that the president beats Romney on helping the middle class.

RON BROWNSTEIN, EDITORIAL DIRECTOR, "NATIONAL JOURNAL": Senator, what were the most important ways, if any, you thought this debate reframed the argument between the two of them and set up the final three weeks of the campaign?

JOHNSON: Again, it's so incredibly important that, because, trust me, Jason and I hear this all the time -- you guys have got to get together, you've got to work together. And that is what Mitt Romney has demonstrated. Plus, he actually has a plan. You know, I talked about, yes, President Obama has a plan. It's those two budgets -- 0- 610.

I mean, we are facing the most predictable financial crisis in our history, and the President of the United States is spending millions of dollars, thousands of man hours, producing these budgets that not a member of his own party are willing to give it a vote. When you're looking forward, let's face it, President Obama won the slogan "Hope and Change". His new slogan is "Forward". He's got nothing to offer in terms of forward where Mitt Romney does, because Mitt Romney understands how to grow the private sector. That's incredible important. MARTIN: Last night Mitt Romney said at one of the tail end, "Government cannot produce jobs." So how can a person stand there and say I'm going to create 12 million jobs but then say government can't create jobs?

JOHNSON: Because in a normal recovery, you would be creating 250,000 jobs a month, which translates to 12 million jobs. The reason we're not creating those jobs is because of the choices, the policies, that President Obama took. You know, because here is the fact: he did not come into office with the economy in a freefall. We were losing jobs, but the fact is, within two months, we entered the second quarter, we only lost 0.7 percent GDP. But the economy bottomed out and then we started recovery the third quarter.

MARTIN: We lost 3.47 million jobs in the last six months of 2008 and we kept losing jobs in the first months of 2009.

O'BRIEN: You don't think the economy was in freefall then?

JOHNSON: No. The economy began to recover in the third quarter. It'd basically flattened out by the second quarter and it actually grew close to 4 percent the next three quarters. But then President Obama's policies took effect and they started scaring consumers and business owners and as a result the economy totally stalled.

BROWNSTEIN: Senator, where is the evidence? If you look at the entire decade since 2000 that tax cuts are going to do any better? When President Bush left, 10 years to the day after President Bush passed his tax cuts, there fewer people were working than on the day they were passing. I mean, that was true only during the depression. What is the evidence in that experience that would say this would do better?

JOHNSON: Let me give it to you. The Bush tax cuts, when they were enacted, revenue into the federal government was a little under $1.8 trillion. Before the housing bubble burst, which, by the way, was caused by Democratic policies, revenue --

(CROSSTALK)

O'BRIEN: Actually, that was kind of multifactoral.

JOHNSON: Revenue was $2.5 trillion. No, no, listen to the numbers -- $1.8 to $2.5 trillion, that's a 42 percent increase. The same thing happened under Ronald Reagan. When he cut taxes, revenue grew by 67 percent. Tax cuts work. Increases in taxes won't.

BROWNSTEIN: But at the end of the Bush term, the median income was lower when he took office, the number of people in poverty with his higher and there were basically fewer -- 1 million more people working than on the day he took office, fewer ten years to the day after. So why, when you look at that, why can you say with great optimism that the results would be better than we've seen either in the Bush years or under the Obama years? Perhaps we're dealing with structural problems that are larger than the issue of what the tax issues are. JOHNSON: You mentioned I think the metric that is most troubling to President Obama's tenure -- median household income, which has declined $4,500, which is 1.8 percent, double what's happened in the past under recessions. That has occurred during Obama's recovery. I mean, that is an incredible method of failure.

BROWNSTEIN: It also declined during President Bush's recovery.

JOHNSON: Not to this extent.

BROWNSTEIN: But it did decline, did it not decline?

JOHNSON: Yes, but not to this extent.

(CROSSTALK)

BROWNSTEIN: So perhaps there is a structural problem larger than any one president.

O'BRIEN: One at a time. Let the senator --

MARTIN: So I got to ask. You talk about tax cuts. The Congressional Budget Office has been very clear, the Bush tax cuts contributes to the deficit. And so please explain --

JOHNSON: $600 billion during this administration.

MARTIN: Right, in this administration. But again, though, President Bush had a surplus but left office with a significant deficit. I'm simply asking how can you make the argument let's cut the deficit but keep going with the tax cuts when it's not going to - the CBO was real clear. It increased the deficit.

JOHNSON: The deficit is always blamed on the Bush tax cuts. The fact is --

MARTIN: Actually, no, just a portion of it.

JOHNSON: A small portion of it. $600 billion out of $5,300 billion (sic) worth of deficit in this administration.

MARTIN: $5 trillion --

JOHNSON: No, no, let's talk about just this administration. $5.3 trillion worth of deficit, $600 billion is the total tax cuts. And, again, here is the problem. President Obama's solution, the Buffett Rule, would raise $5 billion, 11 hours' worth of spending. Or full blown Tax-the-Rich, would raise $67 billion a year to try and solve a $1,100 billion deficit?

(CROSSTALK)

JOHNSON: No, I'm answering the question.

REP. JASON CHAFFETZ, (R) UTAH: Hold on, you get like four questions. I get at least the one here. The Senator is absolutely right. I thought one of the best, most eloquent answers that is Governor Romney gave was what is the difference between him and President Bush? I thought that was a legitimate question asked sincerely and I thought Governor Romney hit that out of the park.

The second part, though, was the other gentleman who stood up and said, "What have you actually done for me? And look at the price of gasoline." And Mitt Romney, I think, eloquently went through the list and said, "With all due respect, Mr. President," -- these are my words, not Governor Romney's words, "Candidate Obama promised root beer in every drinking fountain and did not those."

O'BRIEN: I'm going to stop it here because we're out of time. And for some reason you and I could sit down and do 25 minutes on this debate, and we're going to do that one of these days.

JOHNSON: We should do that, absolutely.

O'BRIEN: But we have to stop it. But as you know, we had Ken Rogoff on earlier talking about gas prices and he was, like, it is completely specious to try to tack gas prices to an individual president. He has said that.

But we have to take break. Senator, we always love having you come on and work through all of these numbers.

JOHNSON: Great to be here.

O'BRIEN: Got to get to John Berman. He's got a look at some of the other stories and breaking news that we're following this morning as well.

BERMAN: Thanks, Soledad. We have more breaking news about Lance Armstrong. Nike has canceled its contract with Lance Armstrong. This as the cyclist has just stepped down as the chairman of his very own Live Strong Foundation, which help cancer survivors and their families. It comes a week after Armstrong was implicated as a key figure in an elaborate doping ring with the U.S. Postal Service team. That report came from the U.S. Anti-Doping Agency. Armstrong founded the Live Strong Foundation after he battled testicular cancer.

The Massachusetts pharmaceutical company linked to a deadly outbreak of meningitis is now the target of a federal criminal investigation. A search was executed Tuesday at the New England Compounding Center. And 15 people have died from a noncontagious form of meningitis associated with a contaminated steroid produce there. And federal officials more issues have been reported with drugs produced by that company.

We have more news now, a major setback for the defending cup champions. The catamaran flipped in San Francisco Bay. No crew members were hurt but the vessel was extremely damaged. The new catamaran cost the team $8 million.

We've been looking at this video, the youth league football coach caught on camera punching a referee is now facing battery charges in Florida. Assistant Coach Don Robinson apparently was upset about an unsportsmanlike conduct call made against him during the game. Robinson says his fellow coaches are standing by him. They say the referee was in the wrong, that Miami Dade Extreme Youth Football League, appropriately named, is now considering kicking their team out of the league. Soledad?

O'BRIEN: Thank you very much, John. Analysis continues about the debate.

Candy Crowley moderated the tense evening, host of "STATE OF THE UNION", chief political correspondent. Howie Kurtz is joining us, "Daily Beast". Lauren Ashburn, editor-in-chief of the "Daily Download." Nice to have all of you joining us.

Wasn't it Tom Brokaw who said pretty much you would need a flak jacket? Did it feel like that to you going into the debate?

CROWLEY: Going into it, it felt a lot more than it did when in the debate. Let me just say that even at the end of it, when it was over, the first person that made a beeline for me was Governor Romney. Came over and said, "Thanks, Candy, very much, great debate."

So I didn't ever -- that was kind of -- I never felt like they were anything other than two men who were watching the calendar squeeze in on them toward Election Day and they were there to fight it out. I mean, you know, I didn't think that they were personal at each other. "Oh, it was clear they had this animosity." It wasn't clear that much on the stage. "It was clear they were going after you." It didn't really feel that way.

(CROSSTALK)

O'BRIEN: Let me ask you about Benghazi, because much is being made and that seems to be the topic that is rising out of all of this. We've played this clip a couple of times so I don't think we need to play it. But there was a point at the end where you were doing a fact check and you said, you confirmed that what the president had said "acts of terror" was, in fact, the case. And then you went on to say but in the main -- or essentially what Governor Romney had said about the two weeks of going back and forth, that he's sort of right on that point, but in terms of the quote, he called him out on the wrong thing.

So this morning, Paul Ryan who has been making the rounds on the morning shows, says, "Well, she's already backtracked." He's talking about you. "She's already backtracked from that statement, as you probably already know. She basically said she was wrong in that assertion, that Mitt Romney is right in what he said. Look, nobody believes that the Rose Garden speech that the president was suggesting that that particular attack was talking about an act of terror."

Are you backtracking of what you said in that fact check last night?

CROWLEY: Goodness, I hope they get back to one another. Listen, what I said on that stage is the same thing I said to you actually last night.

O'BRIEN: Yes, I was sitting next to you, so I know what you said.

CROWLEY: Which is that -- and when I was trying to do, by the way, I was trying to move this along. Because we were -- the question was Benghazi. There is no question that the administration is quite vulnerable on this topic, that they did take weeks to go well, actually, there really wasn't a protest and actually didn't have anything to do with the tape. That took a long time. That's where he was going. That was his first answer, that was Romney's.

And then we got hung up on this -- yes he said, no, I didn't. I said terror. You didn't say terror. And there was this point they both kind of looked at me, you know, Romney's looking at me, the president is locking at me, and I wanted to move this along. Can we get back to the -- so I said, he did say "acts of terror", called it an "act of terror", but Governor Romney, you were perfectly right that it took weeks for them to get past the tape and the --

O'BRIEN: Act of terror, people on one side applaud. And then you said, yes, it took two weeks, people on the other side applauded. So not a backtrack?

CROWLEY: No. I mean, the question was -- we got so stuck on that act of terror. Now, did the president say this was an act of terror? The president did not say.

O'BRIEN: "These acts of terror."

CROWLEY: "These acts of terror." But he was in the Rose Garden to talk about Benghazi. So I don't think that's a leap, sorry.

O'BRIEN: We actually had tweeted out the verbiage from the Rose Garden because my feeling is people are interpreting it different ways so if someone really wants to read it, they can read it and see what they want to say. Before we go to break, and we're going to continue on the other side, so make your question worth it.

CHAFFETZ: I have the greatest respect that it's got to be difficult in that situation. I just felt that personally that was the one time where I felt like there was a genuine disagreement between the two candidates and I felt like it wasn't necessarily your place to try to be fact checker right there.

I happen to think that your assessment of that was wrong. And so I was a bit frustrated on that particular part. I thought you did great on other parts of it, but I really felt like you have two candidates disagreeing. It's not the role of the moderator to try to say, Mr. President, you're right, or Governor Romney --

O'BRIEN: I'm going to stop you there because we've got to go to commercial break but I'm going to let you respond to that on the other side. And we will do - and you may respond as well - but we'll also play the whole chunk so we can see exactly what was being said.

But we've got to take a quick commercial break. We're back in just a moment.

(COMMERCIAL BREAK)

O'BRIEN: Let's continue to talk about the debate last night. Candy Crowley with us, Howard Kurtz and Lauren Ashburn joining our panel this morning. So here was the chunk as Candy was moderating.

(BEGIN VIDEO CLIP)

ROMNEY: I want to make sure we get that for the record. It took the president 14 days before he called the attack in Benghazi an act of terror.

OBAMA: Get the transcript.

CROWLEY: He did, in fact, sir. So, let me call it an act of terror.

OBAMA: Could you say that a little louder, candy?

(APPLAUSE)

CROWLEY: He did call it an act of terror. It did, as well, take -- it did, as well, take two weeks or so for the whole idea of there being a riot out there about this tape to come out. You're correct about that.

(APPLAUSE)

ROMNEY: The administration -- the administration indicated that this was a reaction to a video and was a spontaneous reaction.

CROWLEY: He did.

(END VIDEO CLIP)

O'BRIEN: So, we were talking about backtrack and Congressman Chaffetz was saying he didn't think it was your place to interject there.

CROWLEY: Again, I was trying to move them on. They were hung up on this one thing. Now, again, Mitt Romney had gone out and said at first they said it was the tape and they said it was this. And then they got hung up on did he say "act of terror" or did he not? And I was just trying to say he said "acts of terror", but you're perfectly correct, they took weeks, two weeks actually was short, they took a month to figure out, or to at least tell us. And then he got back on, yes, the track.

I mean, I just -- to me, that's no different -- I didn't say anything off the air than I said there.

O'BRIEN: Today that is being spun as backtracking. Roland, next.

MARTIN: The Congressman is dead wrong. If you stand there and say something that is wrong, you should be corrected on the spot. Look, I have no problem even having a table of fact-checkers there. We shouldn't wait until the debate is over and then have people saying this was right, this is wrong. More people are watching that singular debate and they're watching anyone's particular coverage. And so if you say something and it's wrong, you check them right then. Maybe that's how it works in D.C. but I think we have too many people who don't go there.

O'BRIEN: So are we in the weeds on this?

LAUREN ASHBURN, EDITOR-IN-CHIEF, "DAILY DOWNLOAD": We are so in the weeds on this. I think people care about binders full of women and people care about --

UNIDENTIFIED MALE: Which Romney said.

ASHBURN: Which is what Romney said.

MARTIN: And he didn't answer that question. He was talking about -- like a women.

ASHBURN: The point is that a lot of this stuff is technical. It is over people's heads. They are not paying attention to that. They are paying attention to the body language, they are watching for moments that are going to live on. Like when President Obama said, "Well, my pension isn't as big as yours." You know those are the things that people are fixating on this morning. And this stuff is inside the Beltway.

HOWARD KURTZ, WASHINGTON BUREAU CHIEF, "THE DAILY BEAST": Perhaps, But part of what's going on here, even before the debate is over, Republicans are out in the spin room. John Sununu, who you talked to earlier, and others saying Candy Crowley wasn't fair. Because when your guy is not perceived to have won, you attack the umpire.

And to the extent that this dominates the news coverage, and you're right, the average person is going to get bogged down the semantics, it takes the story focus away from President Obama who was a lot more energized than he was in Denver and he kept Romney at least in part on the defensive.

ASHBURN: I follow social media. In social media, when you are -- when you are looking at the top Google search term during this debate and during the last debate, it was who is winning? We are a culture of up, down. Up, down. And I think people wanted to know, OK --

(CROSSTALK)

KURTZ: In real time.

ASHBURN: Did that mean good? Did that mean bad?

O'BRIEN: Well, we won't really know until the election, right? I mean, ultimately, when we go back and analyze whoever the victor was, we really cannot answer the who is winning question until November 6th.

All right, thank you guys. I appreciate it. We've got to take a commercial break.

We're back in just a moment. (COMMERCIAL BREAK)

CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: Just in to CNN.

U.S. housing starts and building permits rise to the highest level in more than four years, a surge in home construction. These are new numbers released by the government. Building permits for new homes up 11.6 percent in September from the month before. Compared that with a year ago up 45 percent. Housing starts up 15 percent compared to August, up nearly 35 percent from a year ago.

And of course this new home -- new home construction is like a money mover. You've got construction workers, you know trucks and then once the houses are sold, you've got carpets and couches.

MARTIN: Landscaping and all of that stuff.

ROMANS: All this stuff. This is -- that -- that creates economic activity, no question.

O'BRIEN: I was just watching those numbers. All right Christine, thank you.

Still ahead this morning on STARTING POINT, he's helping an American hero, bringing parties together. Ty Pennington does it all and reveals the home that's been built by Democrats and Republicans for a deserving military family. There they are. We will chat with them, coming up next.

(COMMERCIAL BREAK)

COSTELLO: Welcome back, everybody. Ty Pennington is known for building homes for deserving people. We've been following as he brought both political parties together for one goal, to build a home for a military family. It's a plan both parties can agree on.

The plan is called for half of a home to be built -- the plan called for half of the home to be built, you'll remember, at the Republican National Convention, the other half of the home was constructed at the Democratic National Convention. And today the home comes together. It's donated, it's finished and it goes to John Jones II and his wife, Tanisha. They're going to get that home at 12:00 noon.

Ty, nice to see you, good morning. So you put the house together, overall how do you think it went?

TY PENNINGTON, TV PERSONALITY: Well have I to say I mean, this is really what the House United Project is all about. It's finally been united. And you know what? We worked together and we pulled that off. And now Sergeant Jones and his wife are going to go -- will be going inside very shortly.

But it took a lot of people to come together to make it happen. Craftsmen, Here's at Home, We're Building Together, Mixing Home, my champion as well is Make in America, everybody -- all these volunteers. But I think we've really proven today that we can all work together and do something really positive. And these guys are going to be walking through that door in just a little bit.

O'BRIEN: All right. And Sergeant Jones and Mrs. Jones, how excited are you? We're looking at a picture of your new home. And it is beautiful.

SGT. JOHN JONES, II, AWARDED A HOME BY "HOUSE UNITED": Yes. We're very excited. You know, we can't thank all the volunteers enough for all the time that they put into this home. We definitely can't, you know, thank enough for Rebuilding Together and Craftsman.

PENNINGTON: And she's nervous.

O'BRIEN: Mrs. Jones, you're nervous? Let me -- let me read a little bit about your husband to let people know a little about what he has done. He completed two tours of duty in Iraq. He served as a craft operator in the Army transporting troops. He's been home from Iraq for five years. But I know also Mr. Jones you suffer from PTSD and migraine headaches as a result of your service.

Mrs. Jones, if you will, you've got three kids, ranging from age four to 12. That's pretty much the range of my children as well. This must be a very exciting thing for the kids to have a -- a brand new home.

TANISHA JONES, AWARDED A HOME BY HOUSE UNITED: Yes. They're overjoyed. This is something we've always wanted and Rebuilding Together and Craftsman made it possible. So we're grateful.

O'BRIEN: Ty, before I let you go --

(CROSSTALK)

PENNINGTON: And I would like to --

O'BRIEN: Yes go ahead. I'm sorry.

PENNINGTON: Sure. No I was just going to say just like some of those guys last night that just didn't seem to be able to agree on anything, and we can agree with this, it turned out pretty awesome.

O'BRIEN: I would agree and you're right, this has been a show where no one has agree on anything today but I believe we would all say that is a beautiful-looking home.

You know there are so many homeless veterans, there are so many people who need help. What do you do so that it's not one home for one family but you can really kind of spread out and help more people, Ty?

PENNINGTON: Well, I think the one thing we certainly try to do is spread the word that, you know, whatever you can do to help other veterans, do in anyway and especially when it comes to -- to jobs. And I think -- I think what's -- what's really great, too, is a lot of people here are helping out one of their own as well.

So I think all of us as a society, as a community of a nation is, you know, help out when you can. People who have served our country, put their life on the line, you know. Give them a chance to prove themselves here in any field.

O'BRIEN: Well, we're excited about the chance of getting to walk through your new home at 12:00 noon. Ty Pennington, nice to see you. Ty, thanks for joining us. Sergeant Jones, Mrs. Jones, thank you for being with us this morning. And congratulations. It's very exciting.

T. JONES: Thank you.

J. JONES: Thank you.

O'BRIEN: You bet. You bet.

"End Point" is up next. We're back in a moment.

(COMMERCIAL BREAK)

O'BRIEN: Lance Armstrong explaining his departure as chairman from his Live Strong Charity. In a new statement, he writes this. "To spare the foundation any negative effects as a result of controversy surrounding my cycling career, I will conclude my chairmanship."

Lance is accused of doping when he won seven Tour de France titles. He is denying those charges.

Our "End Point" today is going to go to Congressman Jason Chaffetz. In the 20 seconds we have left, wrap it up for me.

CHAFFETZ: Look, the country I think recognizes it's off track. It wants to get back on track. Mitt Romney and Paul Ryan offer a solution, a contrasting vision for America that will get this economy moving again, get jobs back on track. That's why, I think he did so well in the first debate. He did so well in the second debate. And why Mitt Romney and Paul Ryan will be the next President, Vice President of the United States.

MARTIN: You know he lost last night.

CHAFFETZ: No, he didn't.

MARTIN: He did.

O'BRIEN: And we have -- guys, gentlemen, stop. Next show. Thank you for being with us, Congressman.

CHAFFETZ: Thank you.

O'BRIEN: We appreciate it.

Let's get right to "CNN NEWSROOM" with Carol Costello. It begins right now.