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CNN LARRY KING LIVE

Iowa Caucuses

Aired January 4, 2008 - 00:00   ET

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


LARRY KING, HOST: Republican Rudy Giuliani and an outstanding panel standing by to sort through tonight's outcome.
As promised, though, we're going to start with the Republican winner, Mike Huckabee. Were you surprised, governor?

MIKE HUCKABEE, (R) PRESIDENTIAL CANDIDATE: Larry, I really wasn't. I know I surprised a lot of people but I wouldn't have worked this hard and stayed this long in this race if I didn't think we can get here. I believe the message was resonating. I could sense it in people. And I just believe that the Republicans needed to start talking about issues that people were discussing around their kitchen table.

Well, tonight I think we found out that our party is sort of getting its groove back. We're finding out how to talk to the middle class. Finding out how to talk to people in small business that make up 80 percent of the jobs in this country. To speak up for the folks that felt like maybe nobody was talking for them and to them in the Republican Party.

This was not just an Iowa deal. I think it was an American deal.

KING: Strategically, Mike, how did you do it?

HUCKABEE: We just went to voters one-on-one. We focused on a positive message. We did not strike out at our opponents. And believe me, it was tempting. As you know, I got real close to doing it. In the end, I decided people were sick of it. There was so much, I call it political dumpster diving where all people wanted to do was say, here is all that is wrong with my opponent. Everywhere I went in Iowa, if I said, we are going to keep our campaign positive, the audience would break out in applause. And sometimes you think they applaud, well, but they really want to know, what are you going to do to beat up this other guy. In the end I believe a positive message did work. They want a more civil discourse. They know this country has some real problems. They have got to be fixed. And they are not going to be fixed if all we can do is tell you what's wrong with the other guy who wants to be president.

KING: Were you at all tempted to run that ad against Mitt Romney?

HUCKABEE: I was more than tempted. I pretty well pulled the trigger on it. It is one of the few times you try to put the bullet back in the gun. And we actually just decided an hour before it was to go on the air, I said, call the stations and kill it. Pull it off. And we did. I know there was cynicism that said well, we showed it to the reporters. If I hadn't showed it to the reporters, I promise you some of them would have said, you didn't have an ad, you were just saying it. We didn't give it to them and didn't put it out there for them to go run.

If I would have really been playing a game I would have let it run for a day or two and then I would have pulled it and said, oh, I just decided that's a terrible ad. That's not what I did. I pulled it before it ever aired. And I believe it was the right decision. And tonight, that decision was validated.

KING: In retrospect, would it have hurt you.

HUCKABEE: I think it might have. I think it would have hurt me. I think that some of those times you just have a moment in which deep inside your gut you know that there is something that you ought to do that's right. I felt that way. And as I told the people of Iowa, if you gain the whole world and you lose your own soul, what does it profit you? And that's kind of what I just came to. If you have to win the presidency not by telling, look, here is what I want to do to make America a better place but, hey, this guys a bum, how does that qualify me to be president?

And I just decided that wasn't what America was looking for in their next leader. It was what I wasn't looking for in my own person. So it was the right decision, Larry.

KING: Is Iowa representative of the winds of change in America? What's your thought on Barack Obama's win tonight?

HUCKABEE: I think it's very significant. I think the significance of both his victory in the Democrat caucus and mine in the Republican is Americans are clearly saying, we want change. We want to give new people a chance to lead this country. The folks in Washington who have been in charge clearly haven't fixed those things which are broken. And we are going to give a whole new generation, not only different people but a new generation, a chance to take on these problems and solve them.

And I think it's also a greatest testament, particularly in our party, to show that it is not just about the money. When you are outspent at least 15-1 as I was, so many people wrote me off saying, people think he is OK out there talking to maybe the crowds but he can't win without that much money. But here is what we had that money can't buy. We have it thousands of people across this state that were giving us something better than money. They were giving us their heart and their soul and their hard work. We couldn't have afforded them if we would have raised $100 million, Larry, we couldn't have afforded to pay the people who went out there and worked their hearts out for us.

KING: Do you have the money to go through New Hampshire, South Carolina, Florida?

HUCKABEE: We do. And we are even seeing tonight a big upsurge in our Web traffic. But the truth is we have got over $2 million in cash in hand. A lot of the campaigns don't have that much. One of the things we've learned was when we didn't have money, we acted frugally. The federal government needs to operate like our campaign has. We only spend what we have. We don't borrow, we don't go into spending in deficits. Wouldn't it be refreshing if the federal government would do that rather than spend off into the future? I think people responded that to the fact that we ran the kind of campaign that existed with gas from our own tank and we weren't siphoning gas off from somebody else's. And it proved to have worked out and people look for the message more than they did just the money.

KING: It's an amazing story. Congratulations, Mike. We will be seeing a lot of you down the road.

HUCKABEE: Thank you, Larry. Always a pleasure to be on your program.

KING: My pleasure. Mike Huckabee, the 2008 Republican presidential candidate and governor of Arkansas. Let's check in with two of our top political pros looking at things tonight. Bob Woodward, the Pulitzer Prize-winning journalist, assistant managing editor of the "Washington Post." His most recent book, "State of Denial, Bush at War, part III", he is now working on part IV. And in Iowa is Candy Crowley, the CNN senior political correspondent.

Bob, what's your read on tonight?

BOB WOODWARD, "WASHINGTON POST": Big change. It's a big deal. And I was particularly struck by Barack Obama's speech in which he said rhetorically, they said, this could not be done. He never identified who the they were. But the implication was kind of everyone else. And he said this is a people's victory, very, very strong message, very strong victory for him.

And Huckabee is the surprise to a certain extent, he is like Ross Perot created or at least launched on the LARRY KING SHOW. He has a calm ness about him. There is a kind of inner peace that he immediately communicates to people. And I suspect that's part of his appeal.

KING: Candy, what struck you tonight?

CANDY CROWLEY, CNN CORRESPONDENT: Well, what struck me is the message that comes out of here. If, indeed, the numbers hold up and Hillary Clinton comes in third, what it means is that the two change candidates, that is Barack Obama and John Edwards and really on the Republican side Mike Huckabee, have taken this message of change and really propelled themselves into the polls.

I mean this is the worst case scenario for Hillary Clinton coming in third. They wanted, if they were going to come in second, which they thought was possible, they wanted to lose to John Edwards. Now, of course, they have lost to both. It is going to be hard for Hillary Clinton who has run a campaign on this sort of incumbent or quasi incumbent campaign, inevitability and the like. It is going to be very hard for her to pivot within five days and try to push that change message which she has tried to do saying I am for change but I have got the experience. It hasn't worked. I am really anxious to see what they are going to do in New Hampshire to kind of shift that message around.

KING: Joining Woodward and Crowley is David Gergen, long time CNN senior political analyst, editor at large, "U.S. News and World Report" who covered this whole scene tonight. What happened to Hillary?

DAVID GERGEN, CNN POLITICAL ANALYST: She got rolled by Barack Obama. I don't think she just lost. I think he won. And Larry, it had a lot to do with turnout. Last year, they had about 120,000 people out. This time, they had about 220,000 people out. Many of them, a majority of them or a great number of those people who came out, those new caucus-goers went for Barack Obama. Many independents. That gives him hope in New Hampshire where there are many independents, too. And I think we heard tonight one of the most political speeches of the year from Barack Obama. Huckabee's speech was excellent but Barack Obama's speech was memorable.

KING: We will take a break and come back with Bob Woodward, David Gergen, Candy Crowley. We will be hearing from Rudy Giuliani, we'll be hearing from Senator Edwards as well.

And check out the new king of politics section on our Web site, cnn.com/larryking. Watch our Web exclusive interview with Ron Paul who didn't fair badly tonight at all and even hit the streets to talk issues with folks. We did that too and you can see it all only at cnn.com/larryking. Back with more of our outstanding panel right after this.

(BEGIN VIDEO CLIP)

SEN. BARACK OBAMA, (D) PRESIDENTIAL CANDIDATE: They said this day would never come.

MIKE HUCKABEE, (R) PRESIDENTIAL CANDIDATE: Tonight what we have seen is a new day in American politics.

OBAMA: You have done what the cynics said we couldn't do.

HUCKABEE: It started here in Iowa. Thank you and God bless you, every one of you.

OBAMA: We are one nation. We are one people. And our time for change has come.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

KING: You are looking at a live shot of the Iowa state capitol in Des Moines, Iowa. We will be back shortly with Bob Woodward, David Gergen and Candy Crowley. But right before the show we taped an interview with former Senator John Edwards of Carolina country. Here's the way it ran. (BEGIN VIDEOTAPE)

KING: With us now is Senator John Edwards, a vice-president nominee looking to be the presidential nominee of his party. What is your reaction to tonight?

JOHN EDWARDS, (D) PRESIDENTIAL CANDIDATE: I think it's an amazing result, Larry. I had a strong second place finish in Iowa to a candidate Senator Obama who outspent me three or four to one, spent many millions more than I did and I beat a candidate who out spent me by many millions of dollars. It means that this grassroots campaign for change and fighting for change and standing up for the middle class is working.

KING: Are you surprised?

EDWARDS: Actually, I am not that surprised. Because I knew that people were looking for something different, looking for change. Senator Clinton in many ways is the status quo. And people are tired of the status quo. And as well-known as well-known as she was and as much money as she had, she still finished third. And I think what that is is a powerful indication of a way for change in this country. And I think what happens now is we go to New Hampshire and other states where the voters are going to have to decide who, between myself and Senator Obama, can best bring about the change. There are some fundamental differences. We both believe in change. He has a more philosophical, academic approach to it. I think we have a fight on our hands.

KING: Are you saying she is out of it?

EDWARDS: No, I would never say that, certainly wouldn't say that about Senator Clinton but I think what we are seeing is a huge momentum toward a change candidate. I don't think -- given all the money and time and effort that she and President Clinton spent here, to finish third, it doesn't say good things for them I think what it means is the practical matter is voters are going to be choosing between me and Senator Obama for who can best bring about change.

KING: About raising money, how are you going to do in that regard?

EDWARDS: Oh, we will do fine. We will do well as a result of this. But I just have to tell you what this proves is we are not going to have an auction. We are going to have an election. I was grossly outspent by both of them. I was so much the underdog in terms of financial spending in Iowa. Here I finished in a strong second position.

I think what this means is we go roaring out of Iowa into New Hampshire. A place where they don't like candidates who just spent and raise a lot of money. Where they are actually looking for somebody who understands their problems and who will fight for the middle class and will stand up to corporate greed. I think we have an extraordinary opportunity in front of us. KING: Senator Dodd dropped out tonight. Do you the expect the others other than yourself and Senator Clinton and Senator Obama to do the same?

EDWARDS: I can't predict that, Larry. And I don't want to speak for them. I think the world of Chris Dodd. He and his wife and his kids are wonderful people, Joe Biden, Bill Richardson, these are people have put a lot of work and effort. And I would never want to -- I think it would be disrespectful for me to tread on their decision about that.

KING: Are you glad you ran?

EDWARDS: Oh, yeah, I'm gland. I think there is absolutely no question that me being in this race pushing the progressive agenda, I mean, on every big issue from health care to energy to trade to tax, to the war, I mean I have been the person pushing the substantive agenda and the policy agenda. And I am proud of that. I think I have made a real difference. I think I am still going to be president of the United States.

KING: Do you have a thought about Mike Huckabee's win tonight?

EDWARDS: No. I don't have an opinion about any of the Republican candidates. I haven't followed it closely enough. I do think it is always encouraging, though, when you have any candidate who is dramatically as outspent as I was and it appears that he was who manages to do well.

KING: How is Mrs. Edwards holding up?

EDWARDS: Oh, she is great, Larry. We just did a 36-hour nonstop every hour campaigning tour. Elizabeth was with me every step of the way. She feels good. She is strong. She introduced me tonight at our rally after the results came in. We will be side by side in this.

KING: Always good seeing you, John. Well see you down the road.

EDWARDS: Thanks, Larry. Thanks for having me.

KING: Seeing a lot of you. Senator John Edwards.

EDWARDS: So long.

KING: We will rejoin Bob Woodward, David Gergen and Candy Crowley in a while but let's check in with two men you've watched all night long, Wolf Blitzer, the anchor of CNN's THE SITUATION ROOM and the host of LATE EDITION WITH WOLF BLITZER and John King, CNN's chief national correspondent. Both are in New York. Wolf, we have asked everyone else. What surprised you the most tonight?

WOLF BLITZER, CNN HOST: I was sort of surprised I have to tell you that Hillary Clinton came in third. It was very close. Not by much. She could have come in second. Barack Obama did a lot, lot better than I thought he was going to do. I thought that -- I was sort of influenced by the assessment that she had such an excellent operation that the Clinton machine was out there. They were bringing people into Iowa from all over, some of the best political operatives out there and they had a strong presence. I thought that would result in a significant showing for her. I am sure it helped her a lot. But when all was said and done, Barack Obama clearly had the passion. When you take a look at the huge number of new first-time caucus-goers long the Democrats, they showed up. They showed up and they supported Barack Obama. They didn't necessarily show up to support Hillary Clinton.

I guess that was a big surprise for me on the Democratic side. I knew that Huckabee was going to do really well. Because there is this big evangelical Republican presence in Iowa that he was tapping himself into. That was not a huge surprise. The biggest surprise was that Clinton machine didn't do better.

KING: John King, you spent a lot of time in New Hampshire. How well will Senator Edwards do there?

JOHN KING, CNN CORRESPONDENT: He does not, Larry, have a great deal of reservoir of support there. It is a defining moment for his campaign. Many thought if he didn't win Iowa, he would have to drop out of the race. He clearly wants to stay on. There are debates this week and he wants to give it one more chance. But New Hampshire is not his best state. Barack Obama has done a very fine job organizing New Hampshire, the independent vote which can join the New Hampshire primary. And Republicans can join and vote for Democrats if they want in the primary. He has considerable support there.

So it is not the best ground for John Edwards. And he can't afford to lose a second time. But he has clearly decided to fight on for a little bit a very fascinating challenge. The Clintons have a deep network there. It is the defining challenge for her, Larry. There are many Democrats tonight saying and many political professionals in both parties saying if she loses to Barack Obama twice, how does she sustain? Especially as he then heads to South Carolina where African Americans play a huge role?

KING: We will be talking to Wolf and John again a little later. There is still a lot more ahead including Josh Romney, Mitt Romney's son, Rudy Giuliani and our panel of Woodward, Gergen and Crowley. Don't go away.

(COMMERCIAL BREAK)

KING: Before we get back to our panel, we are joined in Des Moines by Josh Romney, the son of the Republican presidential candidate, Mitt Romney. He is the middle child of five Romney brothers. And when he is not campaigning for dad, he is a Harvard Business School graduate working as a real estate developer. Was this a bad night for your father?

JOSH ROMNEY, MITT ROMNEY'S SON: Not at all, Larry. We have had a great time. We have really enjoyed our time in Iowa. We came out with a silver medal, which is great news. We are encouraged about how things are looking here. We are going to go on to New Hampshire. I hope to do well there but this has not been a bad time in Iowa at all. The family and the five brothers and my parents have had an absolute blast in Iowa. We have really learned to love the state. And it has been a good night.

KING: Is New Hampshire a must?

J. ROMNEY: I don't think so. I think we have a lot of opportunities. My dad is doing well in the seven early primary states that are happening before February 5th. My dad is doing well in all of them. So I think we have a lot of opportunities. I think the key is that my dad's message is resonating with the American people. I think as he continues to get out there and people continue to hear his vision for this country, that he is continuing to do well in those early primary states. So I think we have a lot of opportunities. Obviously we are going to hope to do well in New Hampshire but it is not a must for us.

KING: Earlier this evening in New Hampshire, Senator McCain said the Republican outcome in Iowa shows you can't buy an election and that going negative doesn't work. And some see that as a swipe as your father. Do you?

J. ROMNEY: I am not sure what Senator McCain was saying by that. I will tell you what message, what the Iowa voters did send is a message that they want change in Washington.

You look on the Democratic side, they nominated Barack Obama, someone who brings great change to Washington. On the Republican side, you have my dad and Mike Huckabee, two other agents of change.

So I think what it shows voters are anxious for change in Washington. And they want to make a difference. They want something to happen there and they are not going to send the same people back to Washington to talk about the same old problems. They want something done and they want something new.

KING: Josh, honestly do you think your faith had any kind of ulterior effect?

J. ROMNEY: I am not sure. I hope not. I think, obviously, Governor Huckabee had a lot of support from evangelicals. And that's great but I think we had a lot of support as well. We had a lot out evangelicals out there voting for us and supporting us, which is helpful. And I think -- I hope that our faith didn't have any impact. But what we are seeing across the country is the fact that people recognize my man is a man of faith, a man that believes in God. They like the values that he has. They like the fact that he has got a strong family who supports him and that his values are very traditional and very American. I think for the most part his faith helps him quite a bit.

KING: Thank you, Josh. Are you going to New Hampshire?

J. ROMNEY: I am actually going to Wyoming. They're caucusing on the 5th and then to New Hampshire. Thank you, Larry.

KING: Thank you, Josh. J. ROMNEY: All right. Appreciate it.

KING: Josh Romney, son of Mitt Romney. Bob Woodward, is Governor Romney in trouble?

WOODWARD: You can't tell. I mean, I think it's time to get the cold shower out about what Iowa is. It clearly is a very significant snapshot but it is only a snapshot. If you look at the record in the past of the four people who served in the presidency, the four last people, three of them, Reagan, Bush Sr. and Clinton, did not win the Iowa caucuses. So, I think Clinton in '92, though he really didn't campaign, got three percent of the vote.

So it is yet to be determined where this is going and what it means. It is a snapshot. I agree with David Gergen about Obama. There was something about that speech where he knew it was his moment and he carried it rhetorically. He connected it to other people. It was really soaring.

I also think one of the things that's significant about these early caucuses or primaries is you get to see somebody lose. And you often learn more about somebody seeing them in defeat than in victory. I was struck that Hillary Clinton's speech was as if she had not lost. Mitt Romney kind of stepped up to the plate and said, look, I got the silver medal. But Hillary Clinton did not. And I think one of the issues in this campaign in American politics, it's pulsing out there is voters are looking for people who are the voice of realism, who are truth-tellers and kind of can say, look, this is what the situation is and I think some of that got sidestepped this evening. And people see that and notice.

KING: Candy, where goeth Mitt Romney now?

CROWLEY: Well, he goes straight to New Hampshire. He has got a lot of money. He is still doing well in the polls. But the fact of the matter is he is under great challenge by John McCain. This obviously weakens him as he goes into New Hampshire. He has got five days to kind of recover. That is not a very long time.

He probably will drop in these polls. Certainly, the McCain camp is counting on Romney dropping in these polls. What's interesting is you could very well come out of New Hampshire still with a very cloudy picture for the Republicans. We have Fred Thompson now apparently moving on. So there is sort of this chaos theory that both Thompson and Rudy Giuliani kind of depend on, that there will be no clear front runner, no clear candidate on the Republican side by the time you get to February 3rd. That's certainly what Rudy Giuliani is banking on.

KING: David Gergen, could we have a bartered convention when the Republicans gather?

GERGEN: It is theoretically possible, Larry. I think the real difference may be that if Barack Obama were to win New Hampshire and win the next couple of them, the Democrats will very quickly rally around him. I think he will be perceived as the likely nominee. Whereas the Republicans could well have a fractured party here for a number of weeks. If McCain wins in New Hampshire and I think you would have to say tonight that he is likely to do that now, then you then face the possibility of McCain has got Rudy Giuliani waiting down the road for him in Florida. This thing could - and Huckabee, of course, to surprise in a couple of places. He gave a very effective speech of his own tonight.

And I think for Republicans that's not good news, to have the Democrats begin to rally around and feel the sense of inspiration and the Republicans essential to be looking for a candidate, unable to settle on anybody who excites the base of the party and can hold it together. And it is indicative tonight that the Republicans, about 100,000 Republicans showed up, maybe 120,000, in a 50-50 state, the Democrats had 220,000. That's not good news for Republicans.

KING: We will be right back with our panel. We are still to hear from Rudy Giuliani as well. Don't forget to check out the king of politics section on our Web site, cnn.com/larryking. We are only halfway through tonight's special. Stay with us.

(BEGIN VIDEO CLIP)

HUCKABEE: I wasn't sure that I would ever be able to love a state as much as I love my home state of Arkansas, but tonight I love Iowa a whole lot.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

KING: Right before this special edition of LARRY KING LIVE, I taped an interview with former Mayor Rudy Giuliani of New York. Here is what happened.

(BEGIN VIDEO CLIP)

KING: With us, the former mayor of New York, Rudy Giuliani. He is in Miami tonight. Why are you in Miami?

RUDY GIULIANI (R), PRESIDENTIAL CANDIDATE: Well, we were in New Hampshire earlier in the day. We came to Miami for a rally to organize all our people, because they're beginning -- absentee balloting has already begun here in Florida. They have early voting in a week. And the January 29th primary here is an important one for me and for everybody else.

We have put a lot of time in Florida. We want to make sure our organization is in shape. We will be back in New Hampshire tomorrow afternoon, campaigning in New Hampshire.

KING: What's your read, Rudy, on Iowa?

GIULIANI: Congratulations to Mike Huckabee. It was a big win for Mike. He turned it all around about a month ago and kept building on that. I think we all have to tip our hats to Mike Huckabee and say, he did a really good job at Iowa. Now there are 28 more to go between now and February 5th. I think we will win our share of them. KING: Was it a bad night for Rudy Giuliani or one that he really didn't contest that hard?

GIULIANI: I would say it is one that we really realized that we weren't going to have the kind of chance some other people had there, so we put our emphasis on other places. Everybody has known that. You have to look at the number of trips I have made to different places and you get an idea where we put our resources.

We have put a lot of time here in Florida. We've done a lot of work in California. We've done a lot of work in Illinois and some of the states that are coming up on February 5th. Now, we are going to be focusing on New Hampshire and the primaries in between.

We've conducted a proportionate campaign because these primaries are so bunched together in one month that it's really impossible to go from one to the other and give them enough attention.

KING: There are some pundits who are saying, and you can play reporter for us a minute, that Romney has to win New Hampshire. If he doesn't win New Hampshire and Huckabee doesn't last as long as what might be expected, it is you and McCain?

GIULIANI: There is a lot of analysis that will come out of this. We will have to see who wins in New Hampshire and who wins in South Carolina and Nevada and Florida and Michigan and all these other places. I think it will be a very interesting race. I think we are in good shape. We have leads in about 16 or 18 of the states that are coming up.

I believe I am the candidate that can be a 50 state candidate for the Republican party. I think I can reach out in states that some of the other Republicans can't, and give my party the best chance of winning in November. I think a lot of Republicans, as we go along, will see that.

KING: What are your thoughts about Barack Obama?

GIULIANI: Well, obviously, he ran an excellent campaign in Iowa. It was a surprise that he -- I guess it was a surprise that he won. Everyone thought that Hillary Clinton would win. I haven't followed their side of it as carefully. So I don't know how their ups and downs went there. You would have to say he must have run a really good campaign there to beat Hillary Clinton, who has got an enormous amount of money and a big organization.

KING: Are you enjoying this, Mr. Mayor?

GIULIANI: It's a marathon. It's fascinating, of course, because you learn so much about America and you learn so much about the people of this country. You find out in these town hall meetings what's on their minds. I go back and forth from New Hampshire to Florida to Illinois to wherever. The town hall meetings sometimes seem like you are in the same place. People are pretty much interested in the same things. KING: Your thoughts of these constant stories about your successor, Mike Bloomberg, getting in as an independent. Do you discount that.

GIULIANI: I don't discount it at all. Mike is a friend of mine. I have not had a conversation with him about this. He has every right to consider it and look at it. I would have preferred if Mike had remained a Republican. He was a big supporter of our party. He has every right to look at it and make his own decision. I suspect he doesn't make a decision until after at least these initial primaries have run their course.

KING: Finally, you were hospitalized in St. Louis last month. What was it for and how are you doing?

GIULIANI: I had a very bad headache. They checked me out, Larry. I think I got more exhausted from all the checking they did than from the actual situation itself. I am in great shape. Thanks for asking.

KING: Was it a migraine?

GIULIANI: It was a very serious headache. I don't know how you would describe it. It was a serious headache. It was very painful. They checked it out to make sure it wasn't anything more serious than that. They did every possible test. My doctor has put out those reports. They all came back normal, thank goodness.

KING: We will see you down the road. Thanks for joining us.

GIULIANI: Thanks, Larry. Thank you very much.

KING: When we come back, some of the best analysts in the business. We will be talking with Bob Woodward, David Gergen, Candy Crowley, John King and Wolf Blitzer. That's all ahead. Don't go away.

(BEGIN VIDEO CLIP)

OBAMA: We are choosing hope over fear. We are choosing unity over division, and sending a powerful message that change is coming to America.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

KING: They have done yeoman like work for many hours, so we are going to let Wolf Blitzer and John King get some rest, spend a couple more moments with them and then spend the remainder with our panel of Woodward, Gergen and Candy Crowley. Wolf Blitzer, what's the headline tomorrow?

BLITZER: The obvious headlines are that Barack Obama wins, Mike Huckabee wins. These are two very formidable political players, because they have a natural in instinct, both of them. It clearly came through. Mike Huckabee, he is going to have a formidable challenge, himself, now, because a lot of established Republicans don't like Mike Huckabee. They think he is a liberal on a lot of the economic issues and immigration, if you will, on some of the tax related issues. They look at his record in Arkansas and they are not happy with it.

So he is going to be pounded now. He is going to face some serious problems moving on to New Hampshire, South Carolina, Michigan, and beyond.

Barack Obama, he doesn't have this thing locked up by any means. Hillary Clinton is still a formidable force out there in the Democratic party. John Edwards is still a player, as well.

Chris Dodd dropped out. Joe Biden, excuse me, dropped out. One thing I noticed -- and I am looking at the numbers on the Republican side right now, Larry. Clearly, Mike Huckabee won with 34 percent. Romney came in second with 25 percent. There is a battle for third place between Fred Thompson and McCain, Thompson now slightly ahead, 15,000 or so to 14,700 for McCain.

But look at this, Ron Paul, the maverick Republican, he's has got 10 percent of that Iowa caucus vote, 10 percent for Ron Paul. That's way ahead of Rudy Giuliani in Iowa, who only got four percent. Ron Paul is going to be a factor in New Hampshire much more so on the Republican side than he was in Iowa, given all the independents there. Let's not neglect Ron Paul when we are talking about this.

KING: Well said, Wolf Blitzer. Yeoman like work today, Wolf

BLITZER: Thank you, Larry.

KING: John King, is Barack Obama one of the amazing political stories of your tenure? Have you covered anything like this?

KING: Nothing with the potential of this. We don't know if he will reach that potential yet. Larry, months and months ago I was talking with the veteran Democratic pollster Peter Hart, one of the smartest men in the business. He said this is a guy who has the potential to be the next Bobby Kennedy, who has the potential to unite people, to rise above it, to where the traditional rules don't necessarily apply once you get the support.

The only question was, could he keep the flame burning. He was very inspirational tonight. He has grown as a candidate. The question is, can he sustain it now? Now, Bob Woodward made a fascinating and telling point earlier tonight when he said you learn a lot about a politician when they lose.

Hillary Clinton in elected politics has had a short career. She has never lost before. Her husband lost as governor of Arkansas. It made him a better candidate and a much better politician. He got up off the ground and he learned from that defeat. Can she learn from that defeat? Larry, she has only five do to it.

It is very hard, if Hillary Clinton loses two in a row, especially if she is in third place in Iowa, very hard to see her coming back. Especially, again, because then Barack Obama goes into better territory. Watching Hillary Clinton to see if she can learn from losing and learn fast is fascinating.

The other big thing to watch is John McCain has a second chance. He blew his first chance. He was the Republican front runner earlier on. He has a chance now in New Hampshire. If he can win in New Hampshire, to have a race where he can try to take control of the Republican party again. The obstacles are many. Immigration issues still hurt him. He is very short on money. But John McCain, as Mike Huckabee has a chance to redefine the Republican party, John McCain has a chance for revival.

Larry, this is fascinating.

KING: Well put. A fascinating five days ahead. Wolf Blitzer and John King, they are part of the best political team on television. When we come back, Bob Woodward, David Gergen and Candy Crowley. Don't go away.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

EDWARDS: Enough is enough. We are better than this. We are going to bring the change that this country needs.

CLINTON: We're trying to change our country. That is what I'm committed to doing.

ROMNEY: We won the silver.

HUCKABEE: To give our kids a better future, to give this world a better leader. And we join together tonight for that purpose.

OBAMA: In this moment, in this election, we are ready to believe again. Thank you, Iowa.

(END VIDEO CLIP)

KING: We are back with Bob Woodward, David Gergen, and Candy Crowley. Bob, it's no secret, Bill Clinton will spend the next five days with his wife. It is also no secret that he can be one tough cookie. Can she become the comeback gal?

WOODWARD: John King was kind of saying she has a difficult road ahead. I think that's probably true. One of the things you see in all of this political campaign is communications exercise. But it's also an endurance exercise. Anyone who has known or followed Hillary Clinton knows one thing, she never really throws in the towel. She never gives up. So that can surface. She has got a lot of -- there is -- she has the right plumbing in her organization. She has a lot of money, a lot of advice. She has her husband standing in the background.

I was struck this evening in watching all of your coverage on this how there is really not much mention of Bill Clinton. There is almost no mention of George W. Bush, the current president. These people who are running have come into their own. I think it's very clear that Hillary Clinton is on the ballot, not Bill Clinton.

KING: Do you share that view, David?

GERGEN: I do share the view. I think she is capable of a comeback. She has some devoted followers in New Hampshire. There are a lot of women three, especially, who are going to be out this weekend over the next three or four days, I think, working very hard. There is a resilience about -- the one thing about Bill Clinton, I think his wife shares, is they are both very resilient. They've been knocked down before and come back.

But I think she is facing something very new and different in American politics tonight. I must tell you, whether or not he wins any more primaries, there was something historic about tonight that a black American could go into a state that's 95 percent white and win -- not just win a victory, but win a thumping victory, eight percent over John Edwards, nine percent over Hillary Clinton, and then give that speech that would inspire so many to believe that a new day is possible, that if it is possible to bring down the barriers between blacks and whites in this country, maybe it is possible to bring down divisions between Republicans and Democrats, and govern in a new way.

I think for her to come to grips with that is going to be very hard. He has a message now that transcends this question of change. It is really a message of hope and a different kind of America. There are a lot of Americans yearning for that.

KING: We will get Candy Crowley's view on that in our remaining moments. When we come back, more comments from Bob and David as well. We will pick up with Candy right after this.

(COMMERCIAL BREAK)

KING: We are back. Candy Crowley, is George W. Bush kind of a forgotten man here tonight?

CROWLEY: Not by the Democrats. Actually, Hillary Clinton in the past couple of weeks has returned to aiming at George W. Bush. Certainly, Barack Obama does that a lot. You didn't hear that tonight. They are more focused on each other. He is, on the Democratic side, certainly a guy that comes up a lot, not so much on the Republican side.

KING: What surprised you the most tonight, Candy?

CROWLEY: I think not just the depth of his win but the breadth of Obama's win. He beat her in women the last I looked at those internal numbers. That's astonishing. If anything else, the Clinton campaign thought that history would bring in a lot of first-time caucus-goers who were 45, 50-year-old females and older. They put a huge amount of effort into that.

In the end, Barack Obama, it appears, also won the female vote. That he could get such support across such a broad spectrum of the population I thought was pretty amazing.

KING: Bob, wouldn't you say this would have been impossible to predict 10 months ago?

WOODWARD: It's always impossible. For months I was saying, if you take the top 10 candidates, that may not be the next president or the nominee. Huckabee is an example of that, of somebody coming from the rear. Another thing in watching this that struck me is that most of the candidates, particularly those who in the top tier now have a weathered and the seasoned nature about them, that they really have the texture and feel of presidents.

That's very important. They are plausible presidents. I agree with David Gergen about Obama's win, the nature of it, the nature of that speech. It was soaring. If he goes on to win the nomination and become president, obviously, that is one of the milestones in this.

Again, you know, it's only that quick snapshot that we got tonight. You have seen these things turn around, tremendous victories, tremendous defeats in Iowa, and then people go on to become president or not.

KING: David, will we have candidates on February 5th?

GERGEN: Not clear we will on the Republican side. More likely on the Democratic side. I want to echo Bob Woodward on this, it is only in America could we have so much tension and so much turn on 350,000 people going out to vote, essentially, and have the fate of 300 million people ride on that. It is an odd thing. In many, many ways, it is a terrific system. And in many ways, this is a wacky system. It is hard to know which way to come down on that, isn't it?

I think this is an exciting night. Still, there is some -- I think we in the media may feed on that. We may build that up some. I think it is something we need to ask ourselves about sometimes.

KING: Candy, is Iowa important only because it was first?

CROWLEY: Sure, absolutely. You won't see these candidates here any time soon again, I can assure you. Absolutely, it is important. It is important for this bounce that they get into New Hampshire. After New Hampshire, New Hampshire will be important. It's a continuum. This is not the end of something. It is the beginning of something.

To the person who wins the beginning goes the bounce. That's Barack Obama and Mike Huckabee. That helps. That definitely changes the dynamic. It certainly shapes the race, but it is not definitive.

KING: You heading for New Hampshire right now, Candy?

CROWLEY: Absolutely.

KING: Where the action is, so is Candy Crowley. Thank you all very much, Bob Woodward, David Gergen, Candy Crowley, and earlier, of course, John King and our very own Wolfgang, the Wolfman, Mr. Blitzer, who has done such a noble job here all day long.

We invite you to head to CNN.com/LarryKing. We now have a special King of Politics section that includes our web exclusive interview with Ron Paul and more. Also, you can email upcoming guests, participate in a quick vote, or watch a Jack Hannah web extra. We're online 24/7 at CNN.com/LarryKing.

CNN's Iowa caucus coverage continues right now.

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