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CNN LIVE EVENT/SPECIAL

Obama, Huckabee Win in Iowa

Aired January 3, 2008 - 21:00   ET

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


ANDERSON COOPER, CNN ANCHOR: David Gergen, what is it the establishment Republican Party is so worried about?
DAVID GERGEN, ANALYST: The splintering of the old Reagan coalition that George W. Bush put back together for a while -- the Mike Huckabee win. And to call it this early suggests it's a significant win. This is not by a hair. He had to win sort of going away to call it this early, which I think is really interesting.

That surge of evangelicals really is a rejection of someone in Mitt Romney, who is trying to -- who did represent the old coalition. He was trying to be socially conservative and an economic conservative, as well as national security conservative.

So this -- you know, this scrambles the race. And it means -- I think we -- nobody knows where this is going to go now, because as John was just saying -- John King was just saying, New Hampshire -- this greatly strengthens McCain in New Hampshire.

GLORIA BORGER, CNN CORRESPONDENT: Yes.

GERGEN: Coming out of New Hampshire, Rudy Giuliani is now in a stronger position. Romney doesn't come out with that kind of momentum he had hoped he was going to come with this early stage strategy. And Rudy Giuliani's strategy may now work.

So we -- I think we're into a very interesting race. But for a lot of Republicans who are, you know, trying to hold this party together, I think this is not good news.

UNIDENTIFIED FEMALE: No.

GERGEN: I think Gloria is right about that.

SUZANNE MALVEAUX, CNN CORRESPONDENT: And, Anderson, I think it brings up a very important question about just the tone and the mood of people in Iowa in general here. You're talking about the insurgent versus the person who really represented establishment. So far, what we've seen, when we look at the Democrats, it's change over experience. It's change over electability.

What is this going to mean when you look at Hillary Clinton and Barack Obama?

Is this, once again, going to be something, when you turn to the Iowans and they say look, we want something that is very, very different here. We're rooting for the insurgent, not establishment, which would be Hillary Clinton.

COOPER: I want to talk to conservative Bill Bennett in a moment about Mike Huckabee.

But first, let's go to Wolf for some new numbers.

WOLF BLITZER, CNN ANCHOR: All right.

Thanks very much, Anderson.

I just want to update our viewers. We'll get to the Republicans in a second. Thirty-seven percent of the Democratic precincts have now officially reported. And Barack Obama is at top, with 33 percent; John Edwards, 32 percent; Hillary Clinton, 32 percent; Bill Richardson, 2 percent.

On the Republican side, 15 percent of the precincts have reported. But Mike Huckabee -- we have projected Mike Huckabee, the former governor of Arkansas, will win the Republican caucus in Iowa.

Dana Bash is out there watching this -- Dana, you're over at Mike Huckabee's headquarters out in Des Moines. I guess they must be thrilled.

DANA BASH, CNN CORRESPONDENT: That's an understatement, Wolf. They're -- you know, the ballroom is filling up here. But the mood is absolutely electric, as you can imagine. Mike Huckabee's campaign manager just came in and he addressed the crowd here. And he said something that we've heard over and over again from Mike Huckabee himself. We'll probably hear it later tonight. He said that this is evidence that message matters. And he said you cannot buy votes in Iowa.

This is, again, what we've heard from Mike Huckabee. The whole -- the theme of his campaign, particularly in the last few days as he's been trying to wind up his campaign, is that he -- he's sort of been leading a revolution. That is what he's been trying to tell Iowa Republicans, that he is somebody -- we've heard him say over and over that he has been outspent by 20 to one. We heard now -- because they do have a little bit more money now in the Huckabee campaign, it's about 15 to one, Romney to Huckabee.

But, you know, what we have seen at these events -- and I, you know, been with him at several events over the past month, two months here in Iowa, is, you know, group after group -- we hear him addressing not just Evangelicals, but the issue of the fair tax, the issue of sort of populism. So he's had the -- he has this strange mix -- this strange theme that he gets across.

He certainly does address issues like abortion and he's really been able to capture some of the Evangelicals disgust, basically, with some of the other candidates. He is the surprise candidate for many of these -- those Evangelicals. But he also addresses some economic issues that really have hit a cord here in Iowa. And that is that combination, that strange combination really has worked for him. And he is definitely, as you can imagine, extremely excited here. We expect to see Mike Huckabee in here in a short while. We understand he's arriving here at the hotel momentarily -- Wolf.

BLITZER: And we can see his strategist, Ed Rollins, right behind you. Maybe you'll can grab him and pick his brain. A big win for Mike Huckabee.

Stand by, Dana.

We're going to be getting back to you.

Mary Snow is over at Romney headquarters in Des Moines. The Romney people outspent Huckabee by a lot -- a lot of money, but they're going to come in second tonight, not first -- a huge disappointment for Mitt Romney.

MARY SNOW, CNN CORRESPONDENT: It is, Wolf, and a very subdued crowd here, as you can imagine. You know, Mitt Romney, in the final days, has been talking about how hard he has worked here in this state, campaigning nearly a year, spending over $6 million in ads alone in this state.

He had a comfortable lead here and that was eroded in these past several weeks. Mitt Romney today was talking about the fact that if he came in second, that he would have a strong statement. That is how he was bracing -- not projecting any kind of confidence, as this race became so tight.

But for Mitt Romney, so much was at stake here. And he has been saying that he is the only Republican to invest this kind of time and money in not only Iowa, but in New Hampshire. So, obviously, there's so much at stake for him because if he could not win here, what does that mean for New Hampshire as, you know, these barbs have been going back and forth between him, Mike Huckabee and, of course, John McCain?

You know, today he was asked, Wolf, at a forum whether or not he would continue with his negative ads. And he said absolutely, but that he didn't consider them negative ad, they're contrast ads. But, certainly, he's been taking a lot of heat from his opponents for running those ads and targeting them.

BLITZER: And we'll be anxious to hear what Mitt Romney has to say, what Mike Huckabee has to say, the other Republican candidates have to say.

We'll be checking back with you, Mary.

Thank you very much.

I just want to show our viewers, 25 percent of the Republican precincts have now officially reported. We projected that Mike Huckabee will win the majority. Mike Huckabee will win the Iowa caucuses. Right now, with 25 percent officially in, he's at 35 percent; Mitt Romney at 24 percent; Fred Thompson, the former senator from Tennessee, 14 percent; John McCain, the senator from Arizona, 12 percent. A big win for Mike Huckabee -- Anderson, you've got some analysis. You've got three of the best political team on television. I'm anxious what Bill Bennett has to say about this. COOPER: As am I.

Bill, what do you make of this?

Were you surprised?

WILLIAM BENNETT, CNN CONTRIBUTOR: No. I predicted this would happen. But I think the country is surprised. The party is a little surprised, too. But this is America. You know, surprises happen. We do this kind of thing all the time.

One thing for the political cynics -- I mean you made the point, but it needs to be made again. People say you can buy elections in America, everything is for sale. No, sir. This guy was way outspent.

I heard now, Bill Schneider -- and someone will have to confirm this -- that the turnout of Evangelical Christians this time was twice what it was in the year -- in the year 2000. So it's a big night for Huckabee. There's going to be a lot of, I guess, lemonade and tea at the celebration...

BLITZER: What happens...

(CROSSTALK)

BENNETT: I don't know what Ed Rollins is going to drink, but...

(CROSSTALK)

COOPER: How does this impact New Hampshire?

BENNETT: Well, I don't think it impacts it much, frankly. Remember, I just -- in the excitement about Huckabee, remember, Ronald Reagan did not win Iowa. George Bush the first did not win Iowa. Bill Clinton did not win Iowa. And you sometimes go to New Hampshire -- I'm not trying to diminish the significance of this at all. And after New Hampshire, people can't even remember what happened in Iowa.

Now, it looks, in Iowa, as if Huckabee can't win.

But can Romney?

If Romney can't, he is in serious trouble.

But I think the Evangelical Christians came out for him. The message was very clear. On a couple of issues, he's fuzzy. But on things like life he is a man of deep conviction. And I think sought -- people saw that. They couldn't make up their minds about Romney or didn't quite believe the conversion that had taken place and they decided to stick with (INAUDIBLE).

And as Bill said -- Bill Schneider said -- the Republican caucus goer in Iowa is a conservative Christian -- is more typically a conservative Christian.

COOPER: We spent a lot of time talking to Huckabee supporters. And it basically seemed like character trumped any particular issue, that they saw him as man of faith, of strong values and strong faith. And they maybe disagreed with him on immigration or maybe they disagreed with him on something else, but the faith trumped everything else.

BENNETT: Well, again on...

COOPER: Do you think that's true?

BENNETT: Again on immigration, it's not entirely clear to me what his position is. I know he's adopted and put something forward, but I've heard him take different -- different views on this.

Yes, I mean if you are a committed Christian, that is what you believe, that you bear witness to your faith. He made a lot out of bearing witness to his faith. He was criticized.

Remember the cross in the background and Christian leader?

But this is what people respond to. They think this is, indeed, something that we need more of and not less of. So -- and, by the way, if the establishment wants to say well, he has no business doing this, this is part of the Republican Party. It's a big part of the base. Ronald Reagan doesn't get there and George Bush doesn't get there without these folks.

COOPER: Wolf has got an interview, I think, with the RNC chair -- Wolf.

BLITZER: All right, thanks very much, Anderson.

Mike Duncan is joining us right now from Republican headquarters. Mr. Chairman, thanks very much for coming us. What do you think about this? CNN projecting Mike Huckabee, the former governor of Arkansas, will win the Iowa caucuses.

MIKE DUNCAN, RNC CHAIRMAN: Good to be with you this evening, Wolf, and I'm very pleased to get this campaign off to a great start. I congratulate all the candidates on both sides and the people of Iowa for doing a great job today.

Wolf, my job is not to be an analyst. My job is to be a -- someone who does strategy for the party, and to prepare for the candidates coming forward. And we've been doing that.

We have raised $83 million here at the RNC. I have $17 million cash on hand, and I'm ready for the Democrats.

BLITZER: You can't obviously have any favorites right now as chairman of the RNC. You love all of these Republicans. But give us a little sense of what Mike Huckabee means to the Republican Party.

DUNCAN: Well, Wolf, let me talk about what the Democrats are doing and why we're going to win this fall.

We're going to win because we're putting forward our ideas. The Democrats are putting forward old ideas of more government, larger government, more taxes, less responsibility. And our candidates are talking about lower taxes, individual responsibility, and a strong national defense. That's going to be the difference. And it's going to be a difference with -- if it's Hillary Clinton on their side, it is going to be a difference about trust; if it's Barack Obama, its' going to be a difference about experience; and if it's John Edwards, it's going to be hypocrisy.

BLITZER: What do you think, Mr. Duncan, as the chairman of the party, when you see these Republicans bitterly going after each other, trying to attack each other on their views, whether Romney going after Huckabee or vice versa, or Romney going after John McCain or vice versa. How do you react as someone who would like to see all these Republicans basically on the same page?

DUNCAN: Well, Wolf, I have a front row seat to history, and as you know, I don't comment about our candidates.

I will say that our candidates are talking about the issues that will resonate with the American people. They are talking about lower taxes and less government. They are talking about individual responsibility, and they are talking about a strong national defense. And what we're hearing on the other side is a real contrast.

BLITZER: So basically what you're saying is that all of the Republicans are great and all of them would be much better than any of the Democrats. We would hear Howard Dean, the Democratic Party chairman, say obviously exactly the opposite.

But give us a little flavor right now. You've become the minority in the House of Representatives, you've become the minority in the Senate. And, at least the polls show that generically, the Democrats are favored to recapture the White House. If you lose the House, you lose the Senate and you lose the White House, that's a huge setback for your party.

DUNCAN: Well, Wolf, you're talking in 2006 terms. A lots of things happened in 2007. If you have not noticed, the momentum is going with us. We won two out of three governors races; we won two out of three special congressional races this last year. We raised over $30 million more than the Democrat National Committee raised, and the recent polls have indicated that we have closed the gap, the generic gap on people who self-identify as Republicans. We took that from 7 to 2 percent right now.

The Republicans are on a roll. I'm very optimistic about us winning the White House and winning back more congressional seats in 2008.

BLITZER: Are you ready to predict that the Republicans will be the majority in the House and the Senate once again, or are you just going to pick up some seats?

DUNCAN: Well, we'll talk about that. As I said, I'm not an analyst. I'm someone who puts the pieces together that helps make it possible later on. And I feel very good about our position right now. BLITZER: Mike Duncan is the chairman of the Republican Party. Thanks very much for coming in. Good luck to you, good luck to all of the political leaders out there.

Anderson Cooper is standing by.

He's got some analysis of what's going on with the best political team on television.

COOPER: (INAUDIBLE)...

BLITZER: You've got to expect that the Republican Party chairman and the Democratic Party chairman -- they can't take sides among their respective candidates, but they've got to say their party is great.

COOPER: They always do.

Gloria Borger and John King are furiously working their Blackberries.

What have you got -- something?

What are you finding out -- John?

KING: This is called getting spun dizzy.

COOPER: That's right.

KING: I'm just getting several e-mails Romney people, who are saying look, this is a very huge disappointment for them, but life goes on. Some of them are saying now, even if they come in second In New Hampshire, he will stay in the race and fight on in the State of Michigan.

COOPER: They say they're running a national campaign already.

UNIDENTIFIED FEMALE: Yes.

KING: They say they're running a national campaign. But it's very telling to see what happened tonight. He has spent millions on TV ads. He has been the most negative of all the Republican candidates -- launching glossy mailings in South Carolina and in Iowa and in New Hampshire months and months ago, criticizing the other candidates.

And a guy like Huckabee comes out of nowhere, spending any money.

So passion is driving Iowa.

What will drive New Hampshire?

John McCain has the energy on the Republican side right now, and the Romney concede that.

COOPER: What does it say, though, about Mitt Romney, that the more money he spends and the more people get to know him, the less they seem to like him? KING: I think, quickly, if you look at this campaign -- a long campaign -- the people who doing the best -- Mike Huckabee, John McCain and, to a degree, Barack Obama -- although the Democratic numbers are still in a mix. But he has come up against Senator Clinton and he is performing much better now than we thought he would have six or seven months ago. They are new politicians who say they will reach across the aisle and work on a bipartisan basis. People are tired of a long campaign. They're tired of politics as usual. And the guys who seem authentic and refreshing seem to be doing well.

COOPER: So, David, you're shaking your head.

GERGEN: I think there's one factor here, we don't know what it says. We don't know how much his Mormonism cost him. You've got a very heavy Evangelical turnout. We know the Evangelicals and the born- agains are very wary to -- very hostile to Mormonism. And for people who said, in all these exit polls, does religion matter a lot to you, they went overwhelmingly for Huckabee.

So we don't know what's happening here. I do think he's badly wounded. I think it's going to be hard for him to win in New Hampshire now. And if he comes out of New Hampshire with a loss, he can go on, but I think it's a very, very tough uphill road for him.

MALVEAUX: And one thing that we know about New Hampshire is that it's -- faith is less of an issue and is less of a prominent role. And so how that's going to play out, he might -- might not be as strong at all.

BORGER: He can go on. It's going to be tough. I was talking to some Republicans who were sort of stunned, because the Republican Party, Anderson, is not used to having someone who's not part of the establishment win. Republicans generally go to the next fellow whose turn it is to become president. And this race has been anything but that.

And I had one person just say to me, this turns the whole race into chaos, because he -- and he's a Romney supporter. But he doesn't believe that John McCain can win the nomination, either. He doesn't believe McCain can win in South Carolina. So maybe the Giuliani strategy pays off by waiting.

Who knows?

KING: A couple of quick historical points. Republicans tonight, if you read all these e-mails and the phone calls, they're trying to figure out, is Mitt Romney Phil Graham -- the reference being in 1996, Phil Graham got in and had all this money and said he was going to knock off Bob Dole. He went nowhere.

And is Mike Huckabee -- does he have staying power or is he Pat Buchanan, who beat a sitting president at one point in the New Hampshire primary, but then fizzled and faded. It was a protest vote more than a -- of the staying power of that candidacy.

Those are the questions people will be asking. COOPER: I want to bring in political contributors Bill Bennett, Donna Brazile and Jack Cafferty.

Donna Brazile, if you are on Mike Huckabee's team, what do you do about New Hampshire?

Do you not put a lot into it?

Mike Huckabee's only spent $29,000 on television spots in New Hampshire.

Do you just focus on South Carolina and try to get the Evangelical base out there?

DONNA BRAZILE, DEMOCRATIC STRATEGIST: Well, first of all, this must be good news for John McCain, who is probably, right now, breathing a little easier that Mitt Romney did not succeed in winning the Iowa caucuses.

Look, Mike Huckabee has run his campaign on a wing and a prayer. So I'm -- I'm confident that with his faith and his supporters, he can continue to compete in all of the states.

But the question is how will he use his resources?

He will receive a lot of money now, a lot of attention. And I think he should go to New Hampshire. But more importantly, I think he should try to really get his organization together in Michigan and South Carolina and some of other early states.

COOPER: Why hasn't he been embraced by the big name Evangelical leaders?

UNIDENTIFIED MALE: Well...

COOPER: I asked him that question and he said well, I will be once I start doing well.

BENNETT: Well, he may be. But, you know, there -- these -- there are a lot of churches here. There are a lot of schisms in his -- in -- and there are a lot of splits in this. But we'll see.

One of the questions about Mike Huckabee is can he raise money?

Can he raise big money now?

I think he'll spend time In New Hampshire. I think he'll split it between New Hampshire and South Carolina.

Don't forget, Republicans have one in Michigan, too. That could be a very important one -- not the Democrats, but the Republicans have an important one.

I think you'll see him playing the guitar more in New Hampshire. And that -- that's not just a lighthearted thing. This is an interesting guy. I mean he's a minister, he plays that guitar. He was on the Jay Leno show. It's different.

But, again, we have had this in the Republican Party before. We had Pat Robertson. We had Pat Buchanan.

People said oh my gosh, what's going on?

That's part of the Republican Party. It doesn't necessarily mean he's going to win.

COOPER: I'm going to talk to Jack Cafferty in a moment.

But, I know, Wolf, you're going to talk to Howard Dean.

BLITZER: Right. I'm going to just update our viewers, first of all, Anderson.

On the Republican side, 41 percent of the precincts have now reported. We projected that Mike Huckabee will win the Iowa caucuses. Right now he's got 31 percent, to 23 percent for Romney.

Among the Democrats, 59 percent of the precincts have now officially reported. Barack Obama leads with 35 percent, and Edwards and Clinton both have 31 percent; Richardson 2 percent. Barack Obama ahead now, with 59 percent of the caucuses having reported.

Howard Dean is the chairman of the Democratic National Committee. He knows a lot about Iowa. All of us remember four years ago what happened.

First of all, what's your reaction to what's happening on the Democratic side, Governor Dean? Because it's a three-person race, clearly.

HOWARD DEAN, DNC CHAIRMAN: It has been a three-person race for quite some time, and we are seeing a huge, huge turnout. I think it's great, the enthusiasm. I wouldn't be surprised if we doubled the Republican turnout, and that's a very, very good sign for the fall.

BLITZER: And Mike Huckabee, we have projected, will be the winner in the Republican caucuses tonight. What do you say about that?

DEAN: I honestly think it's a sign of how much trouble the Republicans are in. You had a small governor -- a governor from a relatively small state, who came in from nowhere, and I think it's frankly a sign of the disenchantment of the Republican voters with the mainstream Republican candidates.

So I congratulate Mike, but I think it doesn't says a lot for how much trouble the other guys who have spent all that money are in.

BLITZER: He wouldn't be the first former governor from a small state, namely Arkansas, he wouldn't be the first...

DEAN: That's right. BLITZER: ... governor from a small state, Arkansas, who happened to have been born in Hope, Arkansas, to move up that political ladder. So you have got to give him a lot of credit for capturing the Iowa caucuses. He's obviously a formidable player.

DEAN: Well, I don't handicap -- spend a lot of time handicapping Republican primaries. You know, I'm just -- what I'm really pleased at is there is a really clear difference between all of our candidates and all of their candidates, including Mike Huckabee. They're all supporting the war; we're not. They all supported President Bush's veto of health care for kids; we wrote that bill. They have all thought and said that Scooter Libby ought to be pardoned; we think we ought to end the Republican culture of corruption they brought to Washington.

So there's a huge gap between where the Democrats are and where the Republicans are. And the fact that we have almost twice as many people coming out to vote on the Democratic side, something which I don't think has ever happened before in a year where both sides are contested, I think says a lot for where we are going to end up in November.

BLITZER: We spoke to Mike Duncan, your counterpart, the chairman of the Republican National Committee just a few moments ago, and he was very upbeat about the prospects of not only the Republicans keeping hold of the White House, but actually gaining seats in the Senate and House of Representatives. He said the political environment out there has changed dramatically to the benefit of the Republicans.

What do you say?

DEAN: I think somebody must have legalized something that hadn't been legalized prior to that.

We have got gas going to well above $3. People are losing their homes. The economy is supplanting even Iraq as the major issue. I think the Republicans are in deep, deep trouble.

They are a party that's looking backwards towards the 1950s, and we're a party that's looking forward. And if given a choice, the American people will always vote for a party that's looking forward instead of backwards.

BLITZER: Governor Dean, thanks very much for coming in. Howard Dean is the chairman of the DNC.

DEAN: Wolf, thanks for having me on.

BLITZER: All right.

I just want to show our viewers these latest numbers. Sixty-six percent of the Democratic precincts have now reported. Obama is ahead with 35 percent. Clinton and Edwards both having 31 percent each. Take a look at this -- 66 percent of the precincts on the Democratic side have reported. On the Republican side, we've projected that Mike Huckabee wins the Iowa caucuses.

Jeff Toobin is looking county by county by county.

What are you seeing -- Jeff?

JEFFREY TOOBIN, CNN SENIOR LEGAL ANALYST: Well, we're -- since almost two -- now two-thirds of the results are in, and we're seeing who's winning what part of the state. And each candidate has a different color. These are the counties that Barack Obama is winning. He's now winning most of the counties, including Polk County, which is Des Moines. It's the biggest county in Iowa, certainly the most Democratic votes there. And it is the one that he's winning. That's significant because there are so many votes there.

But, also, you look back to the 2004 results in demar -- John Edwards won Des Moines in -- won Polk County in 2004. These are the 2004 results.

And now we go back to 2008 and we see the Democrats -- Hillary Clinton not leading in many counties, but the county she is leading in is on the western edge, which is the most conservative part of Iowa, along the Missouri River, the Nebraska border.

And John Edwards -- he's still showing strength in South Iowa. Remember, that's where he won before. But, importantly, he's not winning in Des Moines or in Iowa City.

Now, Iowa City is a very important place, particularly for Barack Obama, because Johnson County is the site of the University of Iowa. And that's where Barack Obama invested a tremendous amount of time. You see he's leading in most -- most parts of the state. Edwards leading in the south, Clinton leading in a few locations in the west and the north -- Wolf.

BLITZER: Jeff Toobin, thanks very much.

John McCain is making an appearance not in Iowa, but in New Hampshire right now.

I want to briefly listen in to hear what he's saying.

SEN. JOHN MCCAIN (R), PRESIDENTIAL CANDIDATE: I'm very proud of our campaign in Iowa. As you know, because of our financials, we didn't run any ads and we were predicted to finish very badly. I'm proud of the team that we had on the ground and the work that we did. And I'm glad we were out there working hard.

I think that the lesson of this election in Iowa is that, one, you can't buy an election in Iowa. And, two, that negative campaigns don't work. They don't work there and they don't work here in New Hampshire.

(APPLAUSE)

MCCAIN: They're not going to work.

(APPLAUSE)

BLITZER: John McCain speaking to his supporters out in New Hampshire. This is an important development for him -- this Mike Huckabee win in Iowa, because it sets back Mitt Romney, who is clearly his number one rival in New Hampshire.

And remember, five nights -- five days from today, the New Hampshire primary, next Tuesday. That's coming up.

Let's take a look at the numbers on the Democratic side right now. Huckabee, we've projected wins the Republican caucus in Iowa. Among the Democrats, 69 percent of the precincts have now reported. The Democrats -- Obama is ahead, with 35 percent; Edwards, 31 percent; Clinton, 31 percent; Richardson down at 2 percent; everybody else way, way down.

Obama ahead. But, remember, only 69 percent of the precincts. They're still waiting for 31 percent of the precincts to report. So this three person race is clearly, clearly subject to change.

It's a close race -- very, very close. All right, we're going to keep these numbers up on the screen even during this break.

Much more of our special coverage on the Iowa caucuses.

We're at the CNN Election Center.

We'll be right back.

(COMMERCIAL BREAK)

BLITZER: CNN is now ready to project that Senator Barack Obama will win the Iowa Democratic caucuses -- a dramatic development, indeed, for the junior senator from Illinois. We can now project that Senator Obama will beat Hillary Clinton, will beat John Edwards, will emerge the leader in the Iowa Democratic caucuses -- a huge, huge victory for Barack Obama right now in Iowa.

Let's take a look at the actual hard numbers that we have right now. We can make this projection based on the real numbers that have come in, as well as the entrance poll numbers that we received.

Take a look at this. Right now, we're projecting -- with 74 percent of the actual precincts officially reporting to Des Moines -- Barack Obama right now has 35 percent. Hillary Clinton and John Edwards both have 31 percent. It's very, very close, but we can project that Senator Barack Obama will emerge the winner tonight in the Iowa Democratic caucuses.

He will go on to New Hampshire the winner, just as we have projected that Mike Huckabee will win the Republican caucuses, will go on to New Hampshire the winner of that.

Anderson Cooper has got the best political team on television looking at this. Two major projections -- Obama and Huckabee -- very, very dramatic. COOPER: A remarkable night. Probably a few months ago, no one would have expected this -- Gloria Borger, what do you make of it?

BORGER: Well, I think it is remarkable. And I think if Hillary Clinton were going to lose to anyone, she would rather have lost to John Edwards than to Barack Obama...

COOPER: Because?

BORGER: Because Barack Obama has got the money to continue this race and she will continue to go toe to toe with him, but it's going to be a hard fought nomination.

And to go beyond the experience question -- which is, of course, what she was playing up; he was playing up change. I think you can probably look at two things at Hillary Clinton. One is the fact she could be very divisive in a general election campaign. People in Iowa don't seem to want that.

Secondly, her history question, the Clinton baggage, if you will. I think there are a lot of voters there who are saying we want to get beyond that.

COOPER: White House correspondent Suzanne Malveaux, you have been following these Democrats. How has Barack Obama changed on the campaign trail?

MALVEAUX: It really has been extraordinary change to watch his campaign. You'll know that weeks before and even months before people used to complain and say he was kind of boring and academic, that he spoke above people. We have really seen a dramatic change in the tone, not necessarily the message, but the tone of the message, and the way he's been delivering it. It has been very sharp, very crisp. He uses cadence, repetitive. If you believe, if you believe --

And he actually defines things when he talks about hope. I asked him in an interview that was just last week -- he said this one thing that really stood out. He said, I'm a black guy running for president, named Barack Obama. You got to have hope. That was the one line that everybody laughed. They laughed and he got the greatest applause from that. I asked him, why did that resonate with people? This was a room that was 99 percent white, nobody that had a name that was similar to his own, and he used that.

He said, take my example and my experience; we can do anything. I think people in that room really felt that.

COOPER: David Gergen, he has the money and the organization to make the most of this win?

GERGEN: Absolutely, and he's going to now get a great deal of media attention too for the next several days, believe me. Let's take the most obvious thing that comes out of this, John Edwards I think has nowhere to go now.

COOPER: Even with a second place win? GERGEN: Even with a second place win, because he has no money. It's hard to raise money and go forward after this. He had everything staked on this one state.

For Hillary Clinton, it is really important to understand, this was not a great state for her to start with. She did pretty well, it looks like. The Clintons are nothing if not resilient. They will fight back. We'll hear stories about the comeback kid and the rest. This is no time to starts counting Hillary Clinton out. This will be a very tight race.

For Barack Obama, this is a personal triumph. For an African- American to go into a state that's 95 percent white and win against Mrs. Clinton is an absolutely remarkable victory.

KING: David is right. The Clintons are as resilient as they come in politics, but she needs to stop him in New Hampshire. Because then you move to South Carolina, where you have the first large percentage of African Americans. She has great institutional support among the African Americans in that state right now. If Barack Obama wins New Hampshire and he is a viable Democratic nominee, how can her supporters in this state go to the black ministers, go into the black community centers and say, you have to help us stop Obama.

They can't do it and they know they can't do it. She needs to knock him in New Hampshire.

KING: Obama, himself, when asked, why don't African Americans support you? His answer always has been, they have to see me win somewhere. They have to see that I'm viable, that I'm a winner and then they'll be with me.

COOPER: Let's go check in with our political contributors. Bill Bennett, does this change the game a lot?

BENNETT: Well, I think it's, again, a wonder of America here. A remarkable breakthrough this year.

As the other group said, 97 percent, in fact, Iowa rural, white, farming -- farming state. Barack Hussein Obama, a black man, wins this for the Democrats.

I have been watching him. I watched him on "Meet the Press," I've watched him on your show, watched him on all the CNN shows -- he never brings race into it. He never plays the race card.

Talk about the black community -- he has taught the black community you don't have to act like Jesse Jackson, you don't have to act like Al Sharpton. You can talk about the issues. Great dignity. And this is a breakthrough. And good for the people of Iowa.

And what does this mean? That you know, it matters not to Hillary Clinton to lose this -- she lost to Barack Obama in this state. It's a remarkable thing. It's a change in American politics. Whether he goes on and wins other states -- this is something very good that's happened. COOPER: Donna, we're going to pick up with you in a moment, but Wolf, you have an interview with Dana Bash and Ed Rollins?

BLITZER: Right, Dana Bash is standing by, guys. Thanks very much. Barack Obama, we have projected, will win the Iowa caucuses on the Democratic side. Mike Huckabee will win on the Republican side.

Dana Bash is standing by over at Huckabee headquarters with Ed Rollins, who in recent weeks came in as a key player to help Mike Huckabee. He has clearly helped him in Iowa, Dana.

BASH: That's right. Ed Rollins is the national chairman of the Huckabee campaign. He's joining us now.

First of all, congratulations.

ROLLINS: Well, thank you. It's congratulations to the governor, the governor. And the people of Iowa. I mean, I think they made it -- sent a very loud, very clear message today that they want change. And I think Obama was the candidate of change, and certainly, we were the candidate of change.

BASH: The candidate of change, but you know, there has been a lot of emphasis -- I've been out with you and been out with the candidate -- there certainly has been a lot of emphasis on sort of -- he's almost spoken in revolutionary terms, about the need to sort of change the establishment, be anti-establishment. We're hearing sort of back in Washington that this, as you can imagine, turned things on its head.

ROLLINS: Well, Washington doesn't get to run the world. And I was part of a Ronald Reagan -- the Reagan revolution. And when we came to Washington, everybody thought we were going to tear the buildings down and what have you, and be one of the great presidents.

People in Iowa, people in New Hampshire, they have an opportunity to see candidates up close. With the help of the news media, Mike was able to drive his message. It wasn't about paid commercials. Millions and millions of dollars by independent groups and by the Romney campaign, as negative a commercial that you could ever see, couldn't basically knock him off his message.

BASH: But he was also able to do something that is unique to Iowa. He was able to get here a long time ago and really work it the old-fashioned way, in terms of retail politics.

How are you going to emulate that with such an accelerated process from here on out?

ROLLINS: Well, first of all, we hope a lot of people will see this. And I ask people to go to our Web site and volunteer and send money and do all the rest of it to keep this going.

But more important is the new media, blogs, all of you here today, helped him communicate. And it's not about old 30-second commercials. We saw the 30-second commercials didn't work very well. BASH: Now, the reality, as you know, is that Iowa is a state that really plays well for his message. It's a state with a lot of evangelicals. Clearly, that helped him win here.

His next stop, New Hampshire, it's not the case. That really isn't the base of the Republican Party. And his message on the economy, the fair tax -- he wants to abolish the IRS and have a consumption tax -- that might not sell that well either there.

ROLLINS: Well, New Hampshire has always been against taxes. It's always been a state -- many people move from Boston and Massachusetts. It's always been a state that's different. It's always been a state that nominated from our party or gave it the -- to Pat Buchanan. I mean, there have always been some mavericks that have come along.

I think this is the maverick candidacy. I think he's going to be the establishment candidate. I think the establishment people are going to realize Mike Huckabee is a guy that can draw independent voters, certainly can hold the Republican base, and can expand our base to be a competitive candidate.

BASH: How can he be an establishment candidate and sill run a Republican revolution?

ROLLINS: Well, the bottom line is the Republican revolution, as with Reagan, there will be a new coalition. The old coalition is done. There's not a third term for President Bush. That's done. If he's trying to run for a third term, it's not going to work. You have got to basically go out and convince voters that you're going to be different, that you're going to basically support some of the things that are meaningful, but other things are going to be different. Different people, different places.

BASH: And one last question. You don't have an infrastructure pretty much at all past New Hampshire. How are you going to build that in a way that you -- you, you know, you did have a little bit of an infrastructure here, but in the other states, it's again...

(CROSSTALK)

ROLLINS: There's some smart people in this campaign who have looked down the road. Chip Saltsman has been looking to run a presidential campaign for three years. He was Bill Frist's guy. So they've looked at this game.

We've got a campaign in South Carolina. We're building one in Florida today, where we're leading in both polls. You know, and the bottom line is, these other campaigns that have spent a lot of money on professionals don't have the grassroots organization. We are grassroots, volunteer-driven. We had 200 people in our headquarters who made 13,000 calls yesterday to our supporters. That's the old way, that's not the new way.

BASH: Ed Rollins, congratulations. Thank you very much. Thank you. Back to you, Wolf.

BLITZER: Thanks Dana. Thank Ed Rollins for us as well. Here are the actual numbers, 65 percent of the Republican precincts have now officially reported. Mike Huckabee has 34 percent, Mitt Romney 25 percent, Fred Thompson 14, John McCain 13. We have projected Mike Huckabee will win the Iowa Caucuses.

On the Democratic side, 82 percent of the Democratic precincts have now officially reported, Barack Obama expanding his lead right now, 37 percent. We have projected he will win. Right now he has 37 percent, to John Edwards at 30 percent, Hillary Clinton at 30 percent, everybody else way, way below. If you want to continue to see all these tallies coming up throughout, minute by minute, second by second, you can always go to CNNPolitics.com, and you can see it right there.

Mike Huckabee, we have projected, will win the Republican caucuses. And Barack Obama will win the Democratic caucuses.

Soledad O'Brien and Bill Schneider are looking at the numbers. They're trying to understand what's going on. Help our viewers better understand by Barack Obama emerged the winner tonight.

O'BRIEN: With CNN predicting Barack Obama's win, I think it really is a fascinating use of -- maybe the best use of the entrance polls. OK, go back now and find out why. Why did a black guy win an overwhelmingly white state. What do the numbers tell you?

SCHNEIDER: The numbers tell us this was a debate between change and experience. You know what? Change won hands-down. A majority said change was more important to them. Only 20 percent said experience. Obama, among those who cited change as the quality they're looking for, Obama 51, Edwards 20, Clinton came in third with 19 percent.

O'BRIEN: Hillary Clinton had a message of change, too. It just clearly didn't resonate with the voters.

SCHNEIDER: It did not resonate with those voters

O'BRIEN: When you talk about age -- we've mentioned it several times now -- age turned out, as you predicted, very crucial.

SCHNEIDER: It was determinative. Look at the vote among those voters who are under 30 -- 17-24, under 25 -- Obama clearly dominated his constituency, 57 percent for Obama. Hillary Clinton is among others. She wasn't even in the top three among the youngest cohort voters.

O'BRIEN: Didn't even get to the actual rating there. When you look at independents, we knew that they were going to be important. How important did they turn out to be. What were those numbers?

SCHNEIDER: Independents actually were the main reason why Obama edged out Clinton. Among Democrats, it was just about a tie between Obama and Clinton. But among independents -- they were only about 20 percent of the voters in Iowa -- but Obama, 41 percent among independents, clearly out-pacing Hillary Clinton at 17. Edwards came in second.

Clinton did very poorly among independents. This is very important as we come to New Hampshire. They were about 20 percent of the voters in the Democratic caucuses in Iowa. In New Hampshire, independents make up over 40 percent in the likely Democratic voters in that primary.

O'BRIEN: If he continues the momentum, he continues to do very well.

SCHNEIDER: Those independents, they delivered for Obama in Iowa. They could deliver for Obama in New Hampshire.

O'BRIEN: How did he do on the issues overall?

SCHNEIDER: He won every issue. The three issues that we asked about among Democrats were -- the war in Iraq was the number one issue. That was Obama, his issue. The economy was close behind it. That was Obama's issue. Health Care, that is supposed to be Hillary Clinton's issue. Obama out-paced her among voters concerned about health care. The issues were all Obama's.

O'BRIEN: -- for the Hillary Clinton team.

SCHNEIDER: Yes, it does.

O'BRIEN: Bill Schneider, thank you very much. Wolf, back to you.

BLITZER: Soledad and Bill, thank you very much.

I just want to remind our viewers, Bill Schneider will have running analysis on CNN.politics.com. When you are not seeing him here, you will see him at CNNPolitics.com for continuing analysis of this dramatic night.

Barack Obama, we projected, will win the Democratic caucuses tonight, a dramatic development for Barack Obama. If you take a look at the latest tallies, the official tally, 84 percent of the Democratic precincts have reported, Obama getting 37 percent. You see that check? That means we project he will win. Thirty percent for Clinton, 30 percent for Edwards.

A lot more of our coverage coming up. Big nights for Barack Obama and Mike Huckabee. Stay with us. We're at the CNN Election Center. We'll be right back.

(COMMERCIAL BREAK)

BLITZER: The Iowa Caucuses, very dramatic indeed. Welcome back to our continuing coverage. I'm Wolf Blitzer at CNN's Election Center. Let's take a look at the numbers. These are the official numbers that we're getting right now. On the Democratic side, first, with 86 percent of the Democratic precincts officially reporting, Barack Obama has 37 percent, to 30 percent for John Edwards, 30 percent for Hillary Clinton.

We have projected Barack Obama wins the Democratic caucuses.

On the Republican side, 67 percent of the precincts have now officially reported, Mike Huckabee has 34 percent, Mitt Romney 25 percent, Fred Thompson 14, John McCain 13.

Let's take a closer look. Mike Huckabee, we projected, he wins the Republican caucuses in Iowa. He has, as of right now, with 67 percent of precincts reporting, 26,000, to Mitt Romney's 19,000, Fred Thompson 10,000, McCain 10,000, Ron Paul 7,000, Rudy Giuliani almost 3,000, 2,779.

In fact, Rudy Giuliani is joining us now from Miami.

Mr. Mayor, thanks very much for joining us.

GIULIANI: Wolf, how are you?

BLITZER: Looks like a pretty disappointing night in Iowa for you.

GIULIANI: Well, I congratulate Mike Huckabee. He did a great job. And he came from way back and won Iowa by campaigning very hard there.

We did not put a lot of effort into Iowa. We had to spread out our efforts. And we try to do a proportionate campaign in 29 states. So it didn't allow us to use a lot of our resources there.

So I congratulate Mike. And I think he's got a really big victory there.

BLITZER: Is it a disappointment, though? Looking back on your strategy, should you have devoted more resources, do you think, to Iowa?

GIULIANI: What we did, is we looked at the whole calendar. We've got 29 primaries and caucuses. We put in proportionate time in each. And I think, as we move along, you're going to see that that strategy really pays off, in that we've paid a lot of attention to states that some other candidates haven't paid as much attention to.

I mean, I'm in Florida right now because there's a January 29th primary here. They've already begun absentee balloting here and a number of other states. They're going to have early balloting here in a week or so.

So we've put a lot of time into those states. And, you know, time will tell what the best strategy is. We think this, given the compressed primary schedule, this was the best strategy, at least for us, at least for our pluses and minuses.

BLITZER: A lot of pundits always thought what would be good for you, since you didn't devote all your resources to Iowa or New Hampshire, for that matter, was to see a split emerge. And that looks like potentially it could potentially happen. Mike Huckabee winning in Iowa. Now, we go next Tuesday to New Hampshire, where there's a battle under way, at least according to the polls, between Mitt Romney and John McCain.

(LAUGHTER)

I assume you're probably rooting for John McCain, but correct me if I am wrong.

(LAUGHTER)

GIULIANI: I'm rooting for myself. We're going to be in New Hampshire tomorrow afternoon. And we'll be devoting our time to New Hampshire. We think we've run a strong campaign there, again, a proportionate campaign. Some people have paid, you know, a lot of resources to just one state. We've kind of spread it out.

But, you know, we're ready for whatever the outcome is, so that we can move on to the next one and the next one. And this is a 29...

(CROSSTALK)

GIULIANI: This is a 29-state event.

BLITZER: But are you really competing -- are you really competing in New Hampshire and then, let's say, in Michigan and South Carolina, which follow?

GIULIANI: Well, we're competing right now in New Hampshire. And as we move along, we'll figure out where -- you know, where is the best places to use our resources.

We've obviously put a lot already into Florida. I've been here probably more than any other candidate. So this is a state that's important to us. And I came here today to make that point to them. I came from New Hampshire in the morning, came here this afternoon to make the point to Florida how important even their absentee balloting is.

BLITZER: Were you surprised that Huckabee beat Romney pretty decisively, pretty impressively, in Iowa?

GIULIANI: I guess, you know, three or four weeks ago I would have been surprised. But we saw Mike sort of make a big move about three or four weeks ago.

So, it's surprising where we were a couple months ago. It's not surprising right now. You could see it coming the last three or four weeks.

BLITZER: What does it say about him? And what does it say about Romney? Because, as you know, Romney outspent him in Iowa by millions and millions of dollars. GIULIANI: Well, it's a great -- it's a great credit to his campaigning. I mean, he obviously -- he did it going door to door, meeting to meeting, talking to people.

He does have, obviously, a strong constituency there, or one he developed. So it says a lot about him.

And, you know, now -- now, we've got a group of candidates. I think they're all very good, and we're all going to be battling it out. And let Republicans decide who is the best Republican to win the election for us in November.

I believe I am because I believe I can carry out a 50-state strategy and contest in states that some of the other Republicans can't. But, you know, Republican voters get to decide that.

BLITZER: Mayor Giuliani, thanks very much for joining us. Good luck.

GIULIANI: Thanks, Wolf. Thank you very much.

BLITZER: Rudy Giuliani has his own strategy. It's either going to be a brilliant strategy, maybe not such a brilliant strategy. You know what? We'll have between now and February 5th, super duper Tuesday, as it's called, to figure it all out.

This process is officially under way. We're watching it and we'll stay on top of it every step of the way. A big night for Mike Huckabee. A big night for Barack Obama. Let's walk over and check in with Anderson Cooper once again. He's got the best political team on television with him.

COOPER: I want to talk to CNN contributor Donna Brazile, veteran of many Democratic campaigns, about Barack Obama's win tonight. What do you make of it? Where does he go from here?

BRAZILE: This was a victory for those who want change in the party and those who want change in the country. This was a victory for national reconciliation. Obama closed his campaign by quoting Martin Luther King's speech on the fierce urgency of now. He reminded the Iowan voters that he was a candidate who could bring people together. He could change the script. He could start a new chapter in American politics.

Obama did very well. He won big. He is going to New Hampshire now with a lot of momentum. This will play down the road in states like South Carolina and many of those states on Super Tuesday.

COOPER: He has learned a lot as a campaigner on the trail. I remember when he first used that term, that urgency of now speech. I think it was in Iowa a couple weeks ago. He really seemed to catch fire that weekend and from there on. How do you think he changed?

BRAZILE: He connected because he showed the Iowan voters, and many other people around the country, that he understood their problems, that he could bring about the change. He wasn't just talking about hope, but he was actually a candidate who could bring and inspire hope for others.

I think this is a major victory for Obama. Let me just tell you, for African Americans voters who have been waiting for this period of time -- Bill said it, but look, I can tell you, this is huge, in terms of historically speaking as a Democrat. African Americans have always lifted up Democrats. Now Democrats have a chance to lift up African Americans.

COOPER: Jack Cafferty, do you think it also says to African- Americans, this guy can win?

CAFFERTY: Iowa is the whitest place outside the north poll. He's not just winning. He's winning handily there. At this point, he's seven points ahead of both Hillary and John Edwards. This gives tremendous currency to him in states where the color of his skin, unfortunately, might still be an issue. They say, he won in Iowa. It's got to be all right. He passed muster in arguably the whitest states in the country, or one of them.

He's also, as Donna suggested -- he's a nice guy. He's articulate. He's pleasant. He's smart on the issues. He knows what he's talking about. More than anything else, he recognizes the appetite for change in this country. Two hours ago, I said I was excited to find out tonight if the people in Iowa were willing to take those first tentative steps down the Road Less Traveled. If Mike Huckabee and Barack Obama ain't the Road Less Traveled, then we haven't seen it yet.

COOPER: Is the story tonight, is the headline tonight, Bill, that personality, that character trumped any individual issue, both for Republicans and Democrats?

BENNETT: I think it's organization and character and conviction, topped on the Republican side. I think hope and idealism. One discordant note to make, one partisan point, not a discordant note, you know, Howard Dean says small state governor. What's he talking about? What state was he governor of? What state was Bill Clinton of? We have lots of small state governors succeeding.

The other thing is, what was the Clinton theme? What was the song? Wasn't it, don't stop thinking about tomorrow? Make hope your friend. Barack Obama has stolen that, lifted that -- I won't say stolen that or lifted that. He's taken that from the Clintons. Now, what are they going to talk about? I think the most important statistic is the statistic about young people. When you start to appeal to young people, and that kind of idealism and the change that he represents, this is a very powerful instrument in American politics.

BRAZILE: He won on the issues because voters wanted change, but they wanted change in Iraq, change in health care, change in the economy. And Obama won on those issues as well.

COOPER: If you look at Hillary Clinton's speeches, you read the text of them, and she mentions change every third word. Do people not buy it from her? BRAZILE: She talked about experience and she talked about that she's the candidate that can bring on change. Look, I don't count Senator Clinton out of this race. She can reboot her campaign in New Hampshire. But she must get back on the ground and she must go back out there and tell voters that she is actually the change candidate. Right now, we don't think she's the candidate.

CAFFERTY: The first words out of Hillary's mouth in almost every debate early in the campaign were, when I'm elected, when I'm the president. There was an air of inevitability about Hillary that turns out necessarily not to be valid. Hillary very much represents what's gone before in this country. How many years has it been since there has been a Bush or Clinton in the White House? It's been decades.

She has her work cut out. This is not going to be easy. If Barack Obama is a breath of fresh air, as he appears to be, I don't know if she can handle him or not.

BENNETT: Clintons aren't done. He needs to watch his back and his knees. They play hardball.

CAFFERTY: How'd you like to be Bill tonight?

BENNETT: I never want to be Bill.

COOPER: We'll take a short break. As we go to break, we'll show you the latest numbers as they are for both Republicans and Democrats. Be right back.

(COMMERCIAL BREAK)

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