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McCain Speaks at Associated Press Meeting; Tax Deadline Fast Approaching; Supreme Court Denies Appeal by Juvenile Killer

Aired April 14, 2008 - 10:00   ET

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

BETTY NGUYEN, CNN ANCHOR: Custody of hundreds of kids on the line in Texas in a courtroom there at this hour.
T.J. HOLMES, CNN ANCHOR: And the tomorrow's tax deadlines sneak up on you. Yes, folks, that's tomorrow. We got some tips for you, procrastinators, today, Monday, April 14.

You're in the CNN NEWSROOM.

It's kind of a bitter pill to swallow. Will it be a poison one for Barack Obama? Or is it good medicine for Hillary Clinton's campaign. At issue here, Obama's comments that people dealing with a sour economy become bitter. Clinton calls that elitist and is hammering away at Obama. Could this tip the scales in a critical showdown?

CNN's Dan Lothian had is in Philadelphia.

Dan, when this came out, we talked about it a lot over the weekend but we were told from some of our people on the ground it wasn't getting much traction, not much play in the press there in Pennsylvania. Are people talking about it? Is it being covered, these bitter comments?

DAN LOTHIAN, CNN CORRESPONDENT: It certainly is being covered. I mean this really is a controversy that won't go away. And in part, not only because it's being covered but the candidates themselves keep talking about it. Senator Barack Obama trying to put this behind him, but you know, this morning, he's just wrapping up an event in Pittsburgh where he was meeting with some steel workers, union workers there.

And he was really focusing for much of his speech there on trade, how he's against NAFTA and CAFTA, and how he wants to create jobs for Americans here. So really focusing on the economy. But he began his remarks there by really going after this controversy and trying to defend his remarks.

(BEGIN VIDEO CLIP)

SEN. BARACK OBAMA (D-IL), PRESIDENTIAL CANDIDATE: Senator Clinton and Senator McCain seem to be singing from the same hymn book, saying I'm out of touch. I'm an elitist because I said a lot of folks are bitter about their economic circumstances. Now it may be that I chose my words badly. It's not the first time, it won't be the last. But when I hear my opponents, both of whom spent decades in Washington saying I'm out of touch, it's time to cut through the rhetoric and look at the reality.

(END VIDEO CLIP)

LOTHIAN: T.J., I want to go back to something that you asked. It really is true, that when this really started sort of building, it really was sort of treated by Barack Obama as something kind of low key. He explained it away, said that he used the wrong words, wrong choice of words.

But what we have noticed over the weekend, and again today, is that he sort of ramped it up. I mean, he's really going after Senator Clinton now and also Senator McCain.

So certainly, I think one of the reasons you're seeing this is because it's very crucial. The people who are sort of impacted by this will be those working-class voters here. And that's a group that Senator Obama really wants to get in his corner with just about a week to go here for the primary here, T.J.

HOLMES: You are absolutely right. And in a lot of ways he has embraced this and certainly hasn't backed down. He's still saying, yes, I believe people are bitter. As we heard in that clip there, when he mentioned it, somebody in the crowd yelled out, yes, we are bitter. So he's got to use that to his advantage in some ways.

Also Senator Clinton, we're expecting her in Pittsburgh as well. I guess what can we expect to hear from her and what's her schedule like right now?

LOTHIAN: Well, that's right. She will be at that same event meeting with steel workers later this morning. And again, her focus will be much like Barack Obama again on the economy and create -- job creations here, sort of laying out her plan for keeping jobs here in the United States and perhaps building on jobs that went overseas.

She, again, has talked about how she's opposed to these free trade agreements. Of course, Barack Obama has said that she's misrepresented her position on that. But that -- she'll be talking about that as well. But no doubt, she will continue to go after Barack Obama on this controversy, because this is an area perhaps with a week to go where she believes she can make up some ground. Again, going back to that group of working class voters that she also has seen for so long as her base, that's a group that she really wants to continue to build on here in Pennsylvania.

So she will continue to talk about it. But again, painting Barack Obama as elitist, as out of touch, after he made these remarks more than a week ago.

HOLMES: All right. Our Dan Lothian, certainly hasn't become bitter, covering this story in Philadelphia for us.

LOTHIAN: I have not.

HOLMES: We appreciate it. Thanks so much, buddy.

NGUYEN: Dan's never bitter.

Let's talk now about the evangelical vote. It's a traditional Republican stronghold. But can John McCain count on it this time around?

The story from CNN's Dana Bash who's part of the best political team on television.

(BEGIN VIDEOTAPE)

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT (voice over): Sunday morning at the New Covenant Fellowship Church, the sights and sound of prayer in Cumberland County, Pennsylvania.

UNIDENTIFIED MALE: Let's pray.

BASH: These are evangelical voters that Republican presidential candidates rely on to win this state. But they're expressing the kind of faith John McCain almost never does.

DOUG ENDERS, PENNSYLVANIA EVANGELICAL VOTER: Honestly, I haven't got a good feel for him. I haven't -- I've been to his Web site a few times, I haven't got a food feel as to where he stands when it comes to other issues that are maybe mainstreams issues that Christians tend to look at.

BASH: McCain, raised an Episcopalian, now belongs to a Baptist church but was not baptized. On the rare occasions he mentions his faith it's usually in his comfort zone. The military and its men.

SEN. JOHN MCCAIN (R-AZ), PRESIDENTIAL CANDIDATE: Their duty and loyalty belong to their country. They find solace in their faith in God.

BASH: Quite a contrast to the current GOP president who famously said this when asked to name his favorite philosopher.

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Christ. Because he changed my heart.

BASH: McCain is from an older generation, more private about prayer.

MCCAIN: I'm unashamed and unembarrassed about my deep faith in God. But I do not obviously try to impose my views on others.

BASH: But he is equally quiet about his policy positions important to evangelicals, like his opposition to abortions and has angered social conservatives on a host of issues like support for embryonic stem cell research.

MIKE GEER, PENNSYLVANIA FAMILY INSTITUTE: He's got some problems, no question about it. And if he talks about those things that are important and has a track record behind it, I think he can win people over. BASH: Back at the evangelical church, Pastor Brett Hartmann disagrees with McCain on several issues but says he's not bothered that McCain doesn't talk much about his faith.

PASTOR BRETT HARTMANN, NEW COVENANT FELLOWSHIP CHURCH: Sometimes when people kind of use the platform of their faith that it takes away a little bit from their integrity.

BASH: He tells his conservative flock to judge a candidate by his actions, not words. That's what the gospel teaches.

Dana Bash, CNN, Pennsylvania.

(END VIDEOTAPE)

NGUYEN: And at the bottom of the hour we're going to bring you live coverage of John McCain's campaign event. The presumptive Republican nominee is speaking in Washington.

Also on our political radar this morning, a critical contest one week from tomorrow -- the Pennsylvania primary -- and Hillary Clinton is holding a rally there next hour. It's scheduled for 11:00 Eastern and we will carry some of that live as well.

HOLMES: Well, in Texas this morning, hearings about some custody issues involving the 416 children taken from that polygamist compound.

Our Sean Callebs in San Angelo, Texas for us this morning.

Sean, do we expect some kind of decision or -- to come out of this hearing today and possibly a change in custody for these children who are right now, I guess, with the state?

SEAN CALLEBS, CNN CORRESPONDENT: Yes, I think that there's not going to be a change in the sense that they are going to remain wards of the state. This past week, the judge overseeing this said, look, they -- children are going to remain here in San Angelo, Texas at two separate shelters that they're being held at, that until a Thursday hearing. It was interesting because you (INAUDIBLE) 416 children, under Texas state law, each one has to have her -- his or her own attorney.

And just at the top of the hour you just saw a couple dozen attorneys go in. I'm sure that's just a trickle of what we're going to see here throughout the week as Texas officials try to come to grips with all of this -- T.J.?

HOLMES: Right. And we are seeing some pictures here right now, I don't know if you can see them, but you can certainly tell us about them. We are actually looking inside, getting a look inside this secretive compound for the first time. Tell us about this.

CALLEBS: Yes, that's -- that was big news, especially here in this area, because that is really an unknown area. Now you're talking about the Eldorado site, which is about a 45-minute drive from where we are. Apparently a reporter with the "Deseret News" got in there over the weekend, spent a great deal of time there talking with the remaining adults in there, who have tremendous concerns.

They say that it's a very quiet compound right now. They miss the children. And they listen to what one -- what one of the mothers had to say about the situation.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: I do not know why they have my children. No one has told me anything, except for maybe this and maybe that, and it's because of this, but no one has confronted me and said this is why.

(END VIDEO CLIP)

CALLEBS: Well, Texas officials have been very open, very blunt about the reason the children have been removed. Very concerned about child brides, very concerned about multiple wives out at that facility. They were removed because of suspected abuse. It was clearly outlined in a search warrant that was handed down just about 10, 12 days ago.

Another thing that the authorities are looking at, the future of this compound, what is going to happen, 416 children here. They're not -- they could be wards of the state for a while, but the goal, T.J., obviously, is to get them out to foster homes around the state sometime in the near future.

HOLMES: Four hundred and sixteen kids. What to do with all of them. Sean Callebs there for us.

We appreciate you keeping us updated on this story, Sean.

NGUYEN: Well, there's some moderately good news on the economy this morning. New numbers coming out just a short time ago. And it shows a small jump in retail sales for March, although most of that was because you paid more for gas last month. Sales at stores like Wal-Mart and Target actually fell 0.6 percent.

So let's take a look at how these numbers are playing out on Wall Street. The Dow down at just under a buck right now. We're also watching what effect the Asian markets may have. Those markets took a hit overnight. Japan's Nikkei, it dropped more than three percent.

We'll keep a close eye on the markets throughout the day for you right here on CNN.

Rising fuel prices may be among the driving factors in a major airline merger. The "Wall Street Journal" reports Delta Airlines and Northwest will announce a deal as early as tomorrow. Here are some of the stats. The combined airline would keep the Delta name and Atlanta headquarters. The combined company would be the nation's largest carrier.

The hubs, well, they're not expected to change. Right now Delta has Atlanta, Cincinnati, New York and Salt Lake City. Northwest operates out of Minneapolis, Detroit, Memphis and Tokyo. And it's not yet known how the merger may impact ticket prices. There is speculation, though, that the deal could push United Airlines and Continental into a merger, making them the largest carrier.

Keep watching CNN. Our money team has you covered, whether it's job, debts, housing or savings. Join us for a special report. It's called "ISSUE #1," the economy, all this week at noon Eastern only on CNN.

HOLMES: President Bush doesn't have to stand in a security line, doesn't have to worry about his bags being lost. He doesn't have those issues with flight cancellations. He's got his own jet. It's called Air Force One. You might have heard about it.

But President Bush wants you to know that he is feeling your frustration at the airport. A statement from the president following a meeting with his cabinet is coming up right here in the NEWSROOM.

(COMMERCIAL BREAK)

NGUYEN: You are in the CNN NEWSROOM. I'm Betty Nguyen.

This teenager that you're about to see, well, he is no slacker. He saves a boy from a vicious dog.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Telling us that he didn't want to go to the doctor. And he wanted his mommy.

(END VIDEO CLIP)

NGUYEN: The instant hero, ahead in the NEWSROOM.

(COMMERCIAL BREAK)

HOLMES: This news just in to us. The Supreme Court has actually denied an appeal by a juvenile killer. You might remember this story. Christopher Pitman is the name. He was 12-years-old at the time when he killed his grandparents with a shotgun as they slept and then set the house on fire.

Well, he had appealed to the Supreme Court after this double- murder conviction, as saying that the 30-year sentence that he got was too strict. His defense argued that this was kind of excessive for someone his age, that he's on anti-depressants that really kind of put his mind really spinning.

Well, the Supreme Court has denied it. They didn't give any response, any guidance, as to why they did not take up this case. But the 30-year sentence apparently is going to stand now. The Supreme Court really has been appealed to on several other times, several other issues involving young defendants and really hasn't given much guidance in a lot of these cases, and again, did not really give a response and explain why it did not intervene here.

But again, Christopher Pitman, 12-year-old -- 12-years-old at the time he killed his grandparents with a shotgun and set the house on fire. This was in South Carolina. His case has now been denied by the Supreme Court, and his 30-year sentence apparently for now will stand.

NGUYEN: Well, the kidnapped journalist has been freed in Basra. Richard Butler of CBS News was taken captive back in February. He was rescued today by Iraqi soldiers.

Our Jill Dougherty in Baghdad.

Jill, this is extremely good news for the Maliki government.

JILL DOUGHERTY, CNN BAGHDAD CORRESPONDENT: Well, it is. It's good news, No. 1, on a human level, because after all, according to the pictures we've seen and the reports we have, Richard Butler is in good shape. And that is certainly very good news. It's also politically very good timing for the government of Prime Minister Nuri al-Maliki, because you -- this was an operation that was carried out by Iraqi security forces, the Iraqi army.

And if you remember, just a few weeks ago, at the end of March, the Iraqi army was being criticized royally for a very bad performance, at least initially in the city of Basra. They had numerous problems. And so this does come at a very opportune time.

Richard Butler, by the way, according to Iraqi television, was freed not in an operation that actually went looking for him, it happened when Iraqi forces were carrying out surveillance on a house. They were apparently looking for some weapons, and for, as they put it, outlaws.

They engaged in a fire fight with four men inside that house. Fire fight lasted, in fact, for 30 minutes. And then finally they were able to free him and arrested at least one of those people who were in the house.

So here's how Richard Butler of CBS described how it happened.

(BEGIN VIDEO CLIP)

RICHARD BUTLER, CBS JOURNALIST FREED IN BASRA: The Iraqi army stormed the house and overcame my guards. And they burst through the door. And I had my hood on, which I had to have on all the time. And they shouted something at me and I pulled my hood off and said -- and they ran me down the road.

(END VIDEO CLIP)

DOUGHERTY: So again, that operation carried out by Iraqi soldiers, who were just a few weeks ago being very strongly criticized. In fact, the latest figures, to date, 1,300 soldiers and police have been dismissed because of how they performed in Basra. Some actually ran away or even refused to fight -- Betty?

NGUYEN: OK. So 1,300 police and Iraqi soldiers dismissed. What kind of security impact is that going to have? DOUGHERTY: Well, they would say that actually they got rid of the bad apples, and the message coming at least out of the Maliki government, and from the United States, is that slowly but surely, sometimes more slowly than surely, they are improving. And that is very important, because the whole idea here, of course, is that the Iraqi forces will get stronger and be able to take over more and more of the operations. Thus, the U.S. and other coalition forces can stand down, and not carry out as many, and of course, potentially leave.

NGUYEN: Yes. They were called bad apples. They were dismissed, in fact, what, for refusal to fight and things like that, correct?

DOUGHERTY: Correct. Yes. And that was very worrisome. There were some sectarian issues involved. Some people who were afraid to fight. Also, there's some in the army who were not well prepared, well trained. They don't have very good equipment sometimes. And those are issues that the United States is concerned about as well because after all, they are helping to train the Iraqi military. If that's not happening correctly, that's not a good sign.

And one last thing, Betty, it did call into question the whole idea of the prime minister launching this operation and going into Basra. Some were questioning why did he do it so quickly? And why did he do it without apparently adequate preparation.

NGUYEN: All right. CNN's Jill Dougherty in Baghdad for us. Thank you, Jill.

OK. So let's take you to Afghanistan now, because militants have launched a series of bloody attacks on U.S. allies. In Kandahar province, Taliban fighters struck a police post and shot to death 11 officers as they lay sleeping. On Saturday, militants killed four policemen as they were eradicating poppy fields.

And elsewhere in southern Afghanistan, British officials say two Air Force troops were killed yesterday when their vehicle hit an explosive device. Two others were wounded in that same blast.

HOLMES: It's that time of the year again. Tax deadline is tomorrow. What you need to know if you're one of those, you know, who hasn't filed yet.

(COMMERCIAL BREAK)

HOLMES: Let me take you to President Bush (INAUDIBLE) we have now him meeting with his cabinet talking about the issues in the airline industry. Let's listen in.

BUSH: ... and including the progress being made and the freedom agenda around the world. We're also reminded that tomorrow's tax day. And our fellow citizens will be paying taxes during a time of, you know, economic concerns. These are tough economic times. This administration anticipated these times. We worked with Congress to pass a pro-growth package that tries to incent businesses invest and a pro-growth package that will be sending some of your taxpayers' money back to you.

And the secretary mentioned again that the second week of May the checks and/or credits to your account will start coming to you. And that's going to be an important part of making sure this economy begins to recover in a way that will add confidence and hope. One way Congress can act is to make the tax cuts permanent. And if they really are that concerned about economic uncertainty, they ought to create certainty in the tax code.

The other thing we've been very active on is helping people stay in their homes, whether it be the HOPE NOW Alliance, or FHA Secure. Over a million people have been helped to renegotiate and/or to find ways to stay in the home that they own. Now Congress can help. Congress needs to modernize FHA; they need to modernize Fannie Mae and Freddie Mac.

I mean, there's constructive things Congress can do that will encourage the housing market to correct quickly by encouraging -- helping people stay in their homes. I don't think we ought to be bailing out lenders or speculators. I think we need to be helping hardworking Americans who are creditworthy stay in their homes.

Now I do want to say something about trade. There's big disappointment around this table about the action the speaker took on the Colombia Free Trade Agreement. This free trade agreement is good for American workers and it's good for American consumers. And this free trade agreement is in our national interests.

Yet that bill is dead unless the speaker schedules a definite vote. This is an unprecedented move and it's not in our country's interest that we stiff an ally like Colombia, and that we don't encourage our goods and services to be sold overseas.

Congress recently has been working on legislation for beach monitoring and landscape conservation. And those are important issues, but not nearly as important as FHA modernization or the Colombia free trade agreement or making the tax cuts permanent.

Thank you very much.

HOLMES: All right. President Bush there, cabinet meeting, sound we're getting just there with the meeting he had with them a short time ago. But something that did come out of there, he talked about the Colombia free-trade deal.

It's been a pretty controversial spat, really, between the White House and Congress. Of course, you -- the House speaker, Nancy Pelosi, has made a move that has blocked a vote on that particular deal, that trade deal that the president said would be good for this country because it would shut down some barriers, at least make it easier for Colombia to do trades with the United States.

Well, the president now saying that that bill is dead unless Senator -- unless Speaker Pelosi makes a move and does schedule a vote. Right now she has not so, unless she makes a move, it appears according to the president, that deal is dead. The comments there from the president about the economy.

NGUYEN: Well, as the president speaks on the economy, let's look at how the markets are doing today. Dow, not so good so far, down 10 points. The NASDAQ also in negative territory, down eight at this hour. We'll stay on top of the markets and bring you the latest.

HOLMES: All right. I'm talking to you, you folks who haven't filed your taxes just yet. Some of you haven't even started. So you're really at the last minute. Some of you are going to need an extension.

Personal finance editor Gerri Willis is here with us now.

You know, Gerri, you remember, it was...

GERRI WILLIS, CNN PERSONAL FINANCE EDITOR: Hey, there.

HOLMES: ...Governor Huckabee running president talking about he wanted to do away with the IRS. I bet a lot of people were hoping that sounds like a good idea right now, those who haven't filed but it never fails.

WILLIS: Didn't happen it, did it?.

HOLMES: It didn't happen.

WILLIS: No, no.

HOLMES: It never fails. People wait until the last minute. What is the one thing they need to be keeping in mind right now?

WILLIS: Well, you know, the deadline's important. You have until midnight tomorrow to get your taxes postmarked by the post office. Keep in mind, fewer post offices that weren't really extending their hours, that's because more and more folks are filing online. To see what your post office hours are call 800-ASK-USPS.

And if you're filing on line, you have until midnight to hit the click -- to click the send button, that is. But you don't really want to wait until 11:55 p.m. to do that, because you don't want to get stuck in a lot of Internet traffic.

And if you make -- if you happen to make a minor mistake that the IRS catches, the good news is, you'll have a few days to correct the error without penalties. The penalties are high, though, if you do not file. It's five percent per month, up to 25 percent of the amount of the tax you owe. So get on it.

HOLMES: Wow. All right. Those are the folks who still trying to get it in by midnight tonight. Some folks are going to need an extension.

WILLIS: Right. Midnight tomorrow night. Tomorrow's tax day.

HOLMES: Tomorrow, excuse me. Yes.

WILLIS: Right. Yes.

If you're not able to get your return on time, if you can't make that deadline, you'll be able to get an automatic, automatic six-month extension of time to file. But not time to pay. You can e-file an extension request if you use tax preparation software on your computer. You can also go to a tax preparer that has the software.

Now important thing here, if you make less than $54,000 a year, you can free file from the IRS to get your extension and you can also download that extension form. It is 4868, 4868, from the IRS Web site at irs.gov.

HOLMES: And you know something key there that people need to remember, the deadline is tomorrow night to file that extension. Fine. But your taxes are still due. You've still got to pay. They need your money by tomorrow night.

WILLIS: They're still due and owing. You know no forgiveness for that. Look, just because you're extending the time to file, you still have to pay what you owe. You will owe interest on any amounts not paid by the April deadline plus a late payment penalty if you paid less than 90 percent of your total tax. Don't forget about that.

Now if you ask for an extension via computer, you can also choose to pay any expected balance due by authorizing K electronic funds withdrawal from a checking or savings account. So you can do it automatically.

HOLMES: And what happens to you if you want to pay, you want to file on time, but you can't pay? You really can't afford to right now?

WILLIS: Well, there's an answer for that, too. You can file your return on time, and then pay as much as you can right now. The IRS will send you a bill or notice for the balance due. A great idea here, ask for what they call a payment agreement. This will let you make smaller payments to the IRS until you pay the amount in full. If you owe less than $25,000, whoa, you can use the online payment agreement form on the IRS Web site.

It's real easy to do. I just want to tell people it's common as rain water. So if you can't pay, at least pay something and fill out a payment plan form.

HOLMES: All right. And of course, noontime today, we've got "ISSUE #1."

WILLIS: I know. It's great.

HOLMES: What are you talking about today?

WILLIS: Hey, "ISSUE #1" at noon Eastern and all this week we're talking about your debt, your housing, your job and savings. And we're answering your e-mails live in the show. So be sure to join us.

HOLMES: I'm sure you'll probably be getting some tax questions today.

WILLIS: Could be getting some tax questions today.

HOLMES: I'm sure. Gerri Willis, thank you. Good to see you. And we'll see you at noon.

WILLIS: My pleasure. Thank you, T.J.

HOLMES: Yes, you are in the NEWSROOM. Hey, everybody. I'm T.J. Holmes.

NGUYEN: And I'm Betty Nguyen.

(WEATHER REPORT)

NGUYEN: Well, they were homes away from home. Cabins in Minnesota destroyed. Arson suspected. The investigation ahead in the CNN NEWSROOM.

HOLMES: All right. Also want to take you to this live event we have going on as you see there. Senator John McCain is making some comments. We'll listen in, going to take a quick break and get you back to his live comments.

(COMMERCIAL BREAK)

NGUYEN: Let's take you to the campaign trail in Washington, D.C., where you see right there Senator John McCain speaking at the Associated Press' annual meeting and luncheon.

Let's take a listen.

(JOINED IN PROGRESS)

MCCAIN: ... more heat than light on your part, and excessive caution on the candidate's part.

Reporters have one, maybe two shots at me, and they want it to count. By which I mean they'd like to catch me in a mistake, a discrepancy, or as I've been known to, a less than artful expression. And candidates tend to approach them with the primary intention of not saying anything beyond a single message or not saying anything newsworthy at all.

Secondly, I think reporters are better able to meet their -- their first responsibility of ensuring an informed citizenry, if they're allowed to press a candidate for more than a "gotcha" quote or a comment on whatever the cable-driven news environment has decided is the process story of the day.

Lastly, and most importantly, the responsibility of an informed citizenry is as much my responsibility as it is yours. I don't believe in deceiving voters about my positions, my beliefs, or how I would govern this country were I to have the extraordinary privilege of serving as president of the United States. I want voters to know and understand my positions. I intend to stand by them, to defend them. And even at times to engage in spirited debate with voters about them. But I want them to know what and why I believe the things that I believe.

And I think the press wants voters to know that, as well. Even though at times my views can suffer from your translation of them, sometimes more through my fault than yours. That's why I prefer the town hall format or -- to other forms of communications with the voters. And that's why I make myself regularly available to all of you.

I will screw up sometimes, and frankly, so you will you. But on the whole, you and I, and most importantly, the American people, are better served by the openness and accountability that direct, lengthy and frequent exchanges with the press produces. And I'll take my chances with you and trust in the American people to get it right in the end.

In the spirit of that commitment to communicating my views fully and honestly to you, I want to address quickly an issue I know is important to you, the so-called shield law pending before Congress.

I've had a hard time deciding whether to support it or oppose it. To be very candid, but with no wish to offend you, I must confess there have been times when I worry that the press's interest in getting a scoop occasionally conflicts with other important priorities. Priorities, even the first concern of every American, the security of our nation.

I take a very, very dim view of stories that disclose classified information that unnecessarily threatens or makes it more difficult to protect the fiscal security of Americans. I think that's happened before, rarely, but I think it's happened.

I think "The New York Times" decision to disclose surveillance programs to monitor the conversations of people who wish to do us harm came too close to crossing that line. And I understand completely why the government, charged with defending our security, would want to discourage that from happening and hold the people who disclose that damaging information accountable for their action.

The shield law would give great license to you and your sources, with few restrictions to do as you please, no matter the stakes involved, without fear of personal consequences beyond the rebuke of your individual consciences. It is, frankly, a license to do harm, perhaps serious harm. But it's also a license to do good: to disclose injustice and unlawfulness and inequities and to encourage their swift correction.

The First Amendment is based in that recognition, and I am, despite the criticism of campaign finance reform opponents, committed to that essential right of a free society. I know that the press -- the press disclosed security secrets that should have remained so, also revealed the disgrace of Abu Ghraib, a disgrace that made it much harder to protect the American people from harm. Thus, despite concerns I have about the legislation, I have narrowly decided to support it. I respect -- I respect those of my colleagues who have not to; appreciate very much the concerns that have informed their position; and encouraged further negotiations to address those concerns. But if the vote were held today, as I said, I would vote yes.

By doing so, I and others, on behalf of the people we represent, are willing to invest in the press a very solemn trust: that in the use of confidential sources, you will not do more harm than good, whether it comes to the security of the nation or the reputation of good people.

No profession always meets its responsibility or always meets them perfectly. Certainly not mine, and not yours either. There will be times, I suspect, when I'll wonder again if I should have supported this measure. But I trust in your integrity and patriotism that those occasions won't be so numerous that I will, in fact, deeply regret my decision.

And I would hope that when you do something controversial, or something that many people find wrong and harmful, you would explain fully and honestly how and why you did it. And confess your mistakes, if you made them, in a more noticeable way than afforded by the small, small print on a corrections page.

In truth, the workings of American newsrooms are some of the least transparent enterprises in the country, and it's easy to believe that the press has one set of standards for government, business and other institutions, and entirely another for themselves. And if you don't mind a little constructive criticism, from someone who respects you, I think that it is an impression the press should work on correcting.

Now, before I take your questions, I'd like to respond briefly to the comments one of my opponents made the other day about the psychology and political mindset of Americans living in small towns and other areas that have -- that have experienced the loss of industrial jobs.

During the Great Depression, with many millions of Americans out of work, and the country suffering the worst economic crisis in our history, there rose from small towns, rural communities, inner cities a generation of Americans who fought to save the world from despotism and mass murder, and came home to build the wealthiest, strongest and most generous nation on earth.

They were not born with the advantages others in our country enjoyed. They suffered the worst during the Depression. But it had not shaken their faith in and fidelity to America and its founding ideals. Nor had it destroyed their confidence America, and their own lives, could be made better. Nor did they turn to their religious faith and cultural traditions out of resentment, and a feeling of powerlessness, to affect the course of government or pursue prosperity. On the contrary, their faith, their faith had given generations of their families purpose and meaning, as it does today. And their appreciation of traditions like hunting was based in nothing, nothing other than their contribution to the enjoyment of their lives.

In my other profession, in the war I served in, the country relied overwhelmingly on Americans from these same communities to defend us. As Tocqueville discovered when he traveled America 200 years ago, they are the heart and soul of this country, the foundation of their strength and the primary authors of its essential goodness. They are our inspiration. And I look to them for guidance and strength.

No matter their personal circumstances, they believed in this country. They revered its past. But most importantly, they believed in its future greatness: a greatness they themselves would create. They never forgot who they were, where they came from, and what is possible in America. A country founded on an ideal, on an idea, and not on class, ethnic or sectarian identity. And America must not and will not forget them.

Next week I'll begin a tour of places in America that don't frequently see a candidate for president. They're places far removed from the prosperity that is enjoyed elsewhere in America. I want to tell people living there that there must not be any forgotten parts of America, any forgotten Americans.

Hope in America is not based on delusion, but in the faith that everything is possible in America. The time for pandering and false promises is over. It is time for action.

It's time for change. But the right kind of change. Change that trusts in the strength of free people and free markets. Change that doesn't return to policies that empower government to make our choices for us. But that works to ensure that we have choices to make for ourselves.

We've always trusted Americans to build, from the choices they make for themselves, a stronger, safer, more prosperous country than the one that they inherited.

UNIDENTIFIED FEMALE: Thank you very much.

Thank you, Senator. Well, Senator, thank you very much for joining us today.

MCCAIN: Thank you.

UNIDENTIFIED FEMALE: And as you mentioned, Ron, myself, a couple other "A.P." reporters, we spent quite a bit of time with you on the back of the Straight Talk Express, asking you -- asking you questions. And what we've decided to do today was invite everyone else along on the ride. We even brought you your favorite treat.

MCCAIN: Oh, yes! Let's see if we got the right kind. I'm very -- oh, yes! With sprinkles. UNIDENTIFIED FEMALE: Dunkin Donuts with sprinkles.

MCCAIN: With sprinkles. This is our latest health program.

UNIDENTIFIED FEMALE: A little coffee with a little cream and a little sugar.

MCCAIN: There you go.

UNIDENTIFIED FEMALE: I think we're set for the hard questions.

MCCAIN: OK. There we go.

UNIDENTIFIED FEMALE: We wanted to start today with the shield law. So you -- you said you narrowly support the shield law.

MCCAIN: Yes.

QUESTION: Should the administration or a judge decide whether a confidential source be protected?

MCCAIN: I think we should have a legislation that outlines that for a federal judge. In other words, establishes the clear parameters, which I think this law does to a significant degree. There's obviously, in this law, a provision for, "national security," but it is a very focused provision of it.

So I would -- I think the reason why I'm supporting this legislation is there a need for legislation or rather just hand it over to the courts to make -- arrange a -- make a decision that's perhaps based, not on specific enough guidelines, from the legislative branch.

QUESTION: Who makes the ultimate decision, the executive branch or the judicial branch, on whether or not a confidential source should be protected?

MCCAIN: Ron, I think that, if you give specific guidance, as I interpret this legislation, to the judges, then -- to the judiciary, then it narrows obviously the range of options that they could exercise.

Look, when any interest goes to court, it's in the hands of the judiciary, but the judiciary -- and this is why judicial appointments are so important -- in my view, should strictly interpret laws made by the Congress and, along with strictly interpreting -- based on a strict interpretation of the Constitution of the United States.

So right now, I think a federal judge has very, very wide latitude in making that decision. I think this gives them, probably, the guidance that most judges would like to have, to be honest with you. I think that most members of the bench would like to have specific guidelines. And I think in the shield law, they've got some pretty specific guidelines.

QUESTION: To follow up on -- I'm sorry. QUESTION: What do you disagree with specifically?

MCCAIN: It's not that I disagree with it; it's what I worry about, OK? What I worry about is that -- is that there may be occasions where national security is compromised, thereby inhibiting our ability to address this radical Islamic, extremist movement that we are going to be facing for the rest of this century.

Now, why do I worry so much about it? Because radical Islam has been able to make use of modern means of communication. There's nobody in this room that doesn't understand that modern communications has changed the way information is gained, shared and rapidly travels around the globe.

Osama bin Laden is able, routinely, to get out a message, from some obscure place in Afghanistan or Pakistan, that reaches billions of people, which he motivates, instructs and recruits people to his evil cause.

I don't -- twenty years ago we all had hard lines. We all knew exactly where the phone lines went. We all knew where the communication was, et cetera. Now we have a vast array of ways of communicating.

It's not just good, honest, decent citizens that enjoy that -- incredible technological advances; it's also bad people. So this complicates, I think, our national security challenges.

And the reason why I specifically mention it is because a lot of this back and forth in the court is directly related to how we monitor the communications of organizations and groups of people and individuals who want to do bad things.

QUESTION: You made a vague reference in your speech to Senator Obama's comments recently about working-class voters. Do you think the senator is an elitist?

MCCAIN: Oh, I don't know. I think those comments are elitist. I think that anybody who disparages people who are hard-working, honest, dedicated people who have cherished the Second Amendment and the right to hunt and the right to observe that, and their values and their culture that they value and that they've grown up with, and sometimes in the case of generations, and saying that's because they're unhappy with their economic conditions?

I think that's a fundamental contradiction of what I believe America's all about, that I tried to describe in my remarks.

These are the people that produced a generation that made the world safe for democracy. These are the people that today, their sons and daughters are in harm's way defending this nation. These are the people that -- that have fundamental, cultural, spiritual and other values that, in my view, have very little to do with their economic condition, but has everything to do with what Tocqueville said America was all about 200 years ago and is the same today. NGUYEN: And we have been listening to Senator John McCain speaking at the annual "Associated Press"' meeting there in Washington, D.C., talking about a number of issues.

And in fact, if you would like to see him continue to answer questions, you can go to CNN.com/live and watch it as it happens.

Also, we are waiting on Senator Hillary Clinton to speak momentarily from Pennsylvania. She, of course, will be talking about many of the issues that John McCain spoke of, dealing with the economy. And other things that are important to the nation as people go to the polls.

So stay with CNN. We will bring you all of it right here.

HOLMES: And a credit crunch takes a bite at the bank. Wachovia needs a cash lifeline. Business news is next.

(COMMERCIAL BREAK)

HOLMES: Well, gas prices have leveled off, for today at least. But prices still rose one cent over the weekend. Here are the numbers for you. Or you might want to turn away, actually.

The price of regular unleaded is $3.37 a gallon nationally.

NGUYEN: Yikes.

HOLMES: But truck drivers, they're the ones that really have it bad right now, paying $4.10 a gallon for diesel.

NGUYEN: All right. Well, here's more, because rising food costs, they are making it difficult for many Americans. But in poorer countries, the problem is absolutely devastating.

Susan Lisovicz is on the floor of the New York -- New York Stock Exchange with the details on this.

Susan, it is getting very difficult in many areas.

SUSAN LISOVICZ, CNN CORRESPONDENT: That's right. And it's led to angry protests and sometimes, Betty, deadly riots.

Case in point: Haiti, a week's worth of rioting there, and looting led to the ouster of the prime minister over the weekend. Seven people alone died in Haiti.

But we've seen riots in Africa and the Middle East, because food prices, the staple items like rice, for instance, rising so rapidly. The World Bank says global food prices have risen more than 80 percent the last three years.

All sorts of reasons. Not only because food is being grown for biofuels, but also because some countries, some producing countries are hording their foods, leading to export bans. And that just makes a bad situation worse, Betty. NGUYEN: Well, it's a trend that we're seeing here at home, too, isn't it, Susan?

LISOVICZ: Oh, and it's leading to all sorts of changes. I mean, one example we'll give you, for instance, Betty, is the restaurant business. Think about that. Their prices are going up. The economy's slowing down. People are eating out less. What are they trying to do? Well, they're trying to make the portions look the same, even when they're cutting back.

A fascinating story in the "Washington Post," how they're doing that. Like for instance, using smaller plates to, like, make the food items look just as big. Using lighter silverware to make the food seem heavier. Using, like...

NGUYEN: You're kidding me.

LISOVICZ: No, I'm not. Two -- two smaller steaks instead of one 8-ounce steak.

For instance -- and this is -- this is another example. Any item that ends with 95 cents, raising it to 99 cents. It's like, say, $12.95 to $12.99, because it adds up to thousands of dollars a year.

And that's just some of the tricks that they're doing.

NGUYEN: OK, hold up. Hold up. I'm getting smaller plates, smaller portions, lighter forks, but the cost is going higher?

LISOVICZ: No, they're -- well, they're trying not to pass it along to the consumer, so they're trying to make those gigantic portions that we Americans love and are used to, make them look just as big by -- but while they're cutting back.

So smaller plates, again, so the food fills the plate. Lighter silverware. Just changing the price item by a few cents.

Another trick is that your eye -- most people's eye normally goes to the right upper side of the menu. And that's where they're putting the higher-priced items.

NGUYEN: They are getting tricky.

LISOVICZ: How about that? You've got to -- you've got to study your menu very carefully.

NGUYEN: I know.

LISOVICZ: Meanwhile, we're studying the numbers here on Wall Street. Not much doing except -- in the major averages -- except for Wachovia Bank shares falling 10 percent. An unexpected first-quarter decline for Wachovia Bank. Of course, mortgage-related debt hurting it. It's cutting jobs, slashing its dividend by nearly 50 percent. We're going to hear a lot more from financial companies.

The Dow right now turned positive. The NASDAQ is under a little bit of pressure. Pretty quiet so far. Give it time, Betty.

Back to you.

NGUYEN: All right. We got nothing but it here. All right. So thank you, Susan. Appreciate it.

LISOVICZ: You're welcome.

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