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CNN LARRY KING LIVE

Speaker Pelosi to Continue Voting Against War Funding; Time is Running Out for the Democratic Party to Appear United

Aired April 24, 2008 - 21:00   ET

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


LARRY KING, HOST: Hillary Clinton and Barack Obama on the same ticket?
House Speaker Nancy Pelosi says not so fast.

And that's not all...

(BEGIN VIDEO CLIP)

JAMES CARVILLE, CNN POLITICAL CONTRIBUTOR, CLINTON SUPPORTER: Governor...

GOV. BILL RICHARDSON (D), NEW MEXICO: How could you say that?

CARVILLE: Honestly, sir...

RICHARDSON: That is lunacy.

CARVILLE: I have not interrupted you.

RICHARDSON: That is lunacy.

(END VIDEO CLIP)

KING: Think that was heated?

Wait until you see tonight's showdown. All coming at you right now on LARRY KING LIVE.

Hello from Washington. Welcome to the show.

We've got another great political debate for you. If you saw Carville and Richardson tangle last night, you'll enjoy what we've got on tap.

But first, I sat down earlier today with House Speaker Nancy Pelosi. We talked about a number of issues. At the top of the list, the presidential campaign.

(BEGIN VIDEOTAPE)

KING: We welcome back to LARRY KING LIVE from her office at the Capitol of the United States, the Speaker of the House, Nancy Pelosi.

Madam Speaker, thank you very much. Good seeing you again.

REP. NANCY PELOSI (D-CA), SPEAKER OF THE HOUSE: Wonderful to see you.

KING: You have your own flag, huh?

PELOSI: Yes. The Speaker has a flag. I didn't know that until I became Speaker.

KING: The Speaker has a flag. You've made it.

PELOSI: That is it.

KING: Now, let's first discuss some politics.

The Clinton-Obama thing, out of hand? Going to hurt the party?

PELOSI: I am so excited about both of them. I think we have two great candidates, any one of -- either one of them would make a great president of the United States. And I'm certain that will be the case.

But I saw an interesting survey today which said that, say a month ago, before the campaign in Pennsylvania got really heated, that either one of them was about even with John McCain. And now today the poll said that Hillary Clinton was up seven percent and Barack Obama was up eight percent, approximately.

LARRY KING: Over McCain.

PELOSI: Over McCain. So the campaigning, the intense campaigning in the state -- according to at least this survey today -- would indicate that the more people got to know them, the stronger they got in the general election.

KING: But do you think that the McCain campaign will be able to run ads -- no matter who the nominee is -- just from the primary battle, that will hurt them?

PELOSI: Well, that's the -- that's sort of an old way of thinking for the McCain campaign if they want to go that way. What this race is about is about the future. It's about taking our -- really taking our country into this century, whether it's the creation of jobs through innovation, whether it's protecting our planet like with green technologies, whether it's rebuilding the infrastructure of America in a way that is green and whether it's about how -- whether it's how we can protect the American people. It's about issues. It's not about tactics.

KING: So you don't think the intensity will work against one or the other?

PELOSI: Well, that's what campaigns are. It does get intense and people get emotionally involved in its supporters. But I know that one of these candidates will be the next president of the United States and the other one will emerge as a great leader in our country.

KING: Have you thought about endorsing?

PELOSI: I'm the chair of the convention. And, as such, I think it's important to remain neutral. And, again, as speaker of the House, as well, I have many members who are still undeclared. And I want them to make their own decisions about the race.

KING: So you will have the gavel?

PELOSI: I'll have the gavel.

KING: Your chairman, Howard Dean, chairman of the party, said the superdelegates, everything has to be done by mid-June.

Do you agree?

PELOSI: I think it would be constructive...

KING: You don't want a brokered convention?

PELOSI: I don't want a brokered convention. I think there's too short a time -- maybe just about eight weeks between the end of the convention and the election. And I don't think that's enough time to bring everyone together.

I do think that the campaigns have to work their way through this, that we should have all the elections, let the people speak and then we'll find out who our nominee is.

KING: They did it some years back when Kennedy and Johnson were on the same ticket after a strong battle.

PELOSI: You're saying...

KING: If you had your power, would you want them to run together?

PELOSI: No.

KING: No?

PELOSI: I don't think it's a good idea.

KING: Not a good idea?

PELOSI: No, I don't think so.

KING: Because?

PELOSI: I think that, first of all, the candidates -- whoever he or she may be -- should choose his or her own vice presidential candidate. I think that's appropriate. That's where you would see the comfort level on not only how to run, but how to govern the country. And there's plenty of talent to go around to draw upon for a good strong ticket. I'm not one of those who thinks that that's a good ticket.

KING: Really?

PELOSI: Really. KING: There's too much animosity?

PELOSI: No, I just think that -- well, let's put it this way, if they think that it's a good ticket, maybe it is. But I don't think that we should thrust the vice presidential choice onto the presidential nominee. That's her or his decision to make.

KING: What kind of an opponent do you think Senator McCain will be?

PELOSI: Well, I see Senator McCain as a continuation of the policies of George W. Bush -- a war without end, which has plunged us into -- deeply into debt, which is taking us into recession. Senator McCain and President Bush have the same ideas about tax cuts for the wealthiest, giving us this big deficit. And you see what has happened to the economy. And I think McCain will be and McBush. It will just be a third term of George. W. Bush.

KING: McBush?

PELOSI: McBush.

KING: All right. But you became the majority -- your party became the majority in the House primarily pledging to end the war. That didn't happen.

PELOSI: No.

KING: Why didn't it happen?

PELOSI: It didn't happen because we had hoped that the president would listen to the will of the people and at least be willing to compromise on some -- on how the war is conducted and some timetable for the redeployment of our troops -- a responsible, honorable and safe redeployment of our troops out of Iraq in a way that brought stability to the region and more safety to the United States; that the president would realize that the real war on terrorism is in Afghanistan and this war in Iraq has taken the focus away from that; that this war in Iraq has not only cost us over 4,000 lives, enormous trillions of dollars and our reputation in the world, but has seriously undermined the capability of our troops to protect our interests wherever they are threatened again (INAUDIBLE)...

KING: So you needed the president...

PELOSI: We needed the president or we needed...

KING: ... to play along, to cooperate.

PELOSI: Well, we thought we could have some compromises and/or that the Republicans in Congress, who had been trying to distance themselves a bit from the president's policy, then embraced it fully after the election because that was what -- they had been a rubber stamp Congress for the president. So, sadly, we were not able to do that. And, sadly, not being able to end the war has eclipsed many of the accomplishments we have had in this Congress, of which I'm very proud. And they were bipartisan.

KING: Will you say unequivocally that if one of the two -- one of your two candidates from your party wins, you will end this war?

PELOSI: I believe that would be the case, yes. And I think the public would be expecting that. And it would be again, a safe, honorable and responsible redeployment out of Iraq with the focus on fighting the real war on terrorism.

KING: How big a plurality in the House for you next year?

PELOSI: Well, I -- here's what I have in mind. I have in mind a secure, strengthened Democratic majority in the House so we can move forward with our initiatives to create jobs...

KING: What's your plurality now?

PELOSI: We have -- 435 people in the Congress, we have 234 of those. There are two seats that are not filled -- two Republican seats. And we're contending for those seats right now. So...

KING: So you're saying you're going to increase it?

PELOSI: We're going to increase it.

KING: I want to get this right. In a 2006 press release, you declared: "Democrats have a common sense plan to help bring down skyrocketing gas prices." Gasoline now, it keeps going up proportionately.

PELOSI: Right.

KING: This is a record high in the history of gasoline.

What happened?

PELOSI: Well, it's almost three times what it was when President Bush took office. It was $1 something when he took office. Now it's $2.56 on average, but it's higher in California.

KING: Now, I think, $3.50, they're saying now.

PELOSI: Three dollars and fifty cents. Oh, down six cents. Well, it's where I'm from in California, sad to say. And what we have tried to say to the president, also, is there is a way -- and we have to think short-term and long-term on it today.

I called for the president to not increase the oil in the strategic petroleum reserve. That's a reserve in case we need it for our defense purposes. The president has done this before. In fact, he's released oil from this SPRO is what we call it, the SPRO. At the time of Katrina, he released oil from it.

We're not saying that. We're just saying don't put any more oil in. Let that go onto the market, increasing supply, lowering costs. It could bring down the cost of a gallon of gasoline from five cents to 25 cents, depending on the expert that you believe, but it goes in that direction.

We've asked the president again and again to join us in fighting price gouging, market manipulation, cartel activities of OPEC, which are harmful to the marketplace.

KING: So you blame it all on him?

PELOSI: I'm not blaming it on him. I'm just saying that this has to be -- there has to be a plan. The president has not had a plan. And it isn't -- again, you can't do something that will bring them down tomorrow except the SPRO would, a bit. But you have to have a long- term plan.

And this is what we have, which is our -- a new energy policy which reduces our dependence on foreign oil. That's a national security issue. It's an economic issue for us. It's an environmental issue. And it is, if you believe as I do, that this is God's creation, it is a moral issue to pass this planet on to the next generation intact.

And -- and the president has resisted that kind of an economic policy -- energy policy. He's just talked about more drilling in the ANWR in Alaska. And that is not a plan to do that. But we have to do it.

And, again, no matter how much of a margin we would have in the House and the Senate, and even if we had the White House, it requires bipartisan cooperation, working together. Because we're working against cartel interests internationally who are manipulating the price of oil.

KING: So you have to be combined here?

PELOSI: I believe so.

KING: Yes

We'll be right back right after this.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

KING: We're back with two of the top pros in the game.

In Chicago, David Wilhelm. He was Bill Clinton's campaign manager in '92. He's former chairman of the DNC. He is now a supporter of Barack Obama.

And in Carmel, Indiana, Terry McCullough, who was chairman of the DNC. He's now chairman of Hillary Clinton's presidential campaign.

David, was the speaker, right, this ticket can never work together?

DAVID WILHELM, FORMER CHAIRMAN, DNC, SUPPORTS OBAMA: Oh, I just I think it's too early to get into that kind of speculation. In fact, it's almost arrogant and presumptuous for me to talk about who should be the vice presidential candidate at this point.

One thing we have plenty of time to do is to take the time out to study this, to do the tough deliberation that needs to go into the selection of a vice president.

KING: All right...

WILHELM: So I think there's plenty of time between now and the convention to figure that one out.

KING: Terry, did Pennsylvania change the picture?

TERRY MCAULIFFE, CHAIRMAN, CLINTON CAMPAIGN: Well, I think it did, Larry. It was a big win for us. We won by 10 percentage points. We had been outspent three to one, as you know. A lot of negative ads run against Hillary.

I think the voters, when you look at the exit data, they said they trusted Hillary to get the economy going, to deal with health care, to deal with the global issues that go on.

So I think it was a big game changer. I'm out here in Indiana today. I spoke at the Hamilton County J.J. Dinner. That's the next big contest.

And I think very similarly here, people are concerned about the economy, job creation, health care. And those are Hillary's issues.

KING: David?

WILHELM: I think it was anything but a game changer. She didn't have the game changer that she needed in a state that was tailor made for her. At the end of the day, Senator Clinton only gained 10 delegates. I think we got a bigger delegate edge out of Kansas than she got out of Pennsylvania. It was anything but a game changer.

And the fact is even in the State of Pennsylvania, when people were asked who do you trust most of the economy, people said we trust each candidate equally.

So the game changer that Senator Clinton needed was -- did not occur. And it's just one more step in a long process. Senator Obama has 160 delegate lead. It's a lead that is not going to be made up. He's going to be the next nominee of the party.

KING: Now, Terry, Clinton die hard James Carville and Obama supporter, Governor Bill Richardson, went at it last night on this show.

Richardson raised the idea of a political dynasty.

Watch this.

(BEGIN VIDEO CLIP) RICHARDSON: There's this, as I said, clinging to the throne. You know, we're America. We're not Monaco.

KING: OK. I want to...

RICHARDSON: You know, this country has had...

KING: I want to -- I want to...

(LAUGHTER)

RICHARDSON: Families running the country.

KING: Hold on.

CARVILLE: I don't know how to address that kind of idiocy, but let me try. The people are voting. It's not like somebody is sitting here -- and, by the way, they voted in Pennsylvania. They're going to vote in Indiana. They're going to vote in North Carolina. And as opposed to this kind of kind of vacuous kind of comment, why don't he encourage his candidate, Barack Obama, to go debate, as opposed to he and I sitting here and doing this?

(END VIDEO CLIP)

KING: Terry, do you think your candidate is acting as if she's entitled?

MCAULIFFE: I don't think anyone who has watched Hillary campaign for the last 16 months thinks she's entitled to anything. She has said from day one she's got to earn this nomination. If you look, Larry, at the states -- California, Texas, Florida, Ohio, Pennsylvania, New York, New Jersey, Michigan. You look at the states that Hillary Clinton has won -- David sort of diminishes Pennsylvania. Pennsylvania is a key state we Democrats have to win for the Electoral College this November.

You take a state like Pennsylvania, Michigan, Florida -- absolutely Pennsylvania. Those are critical states for us. Hillary has won every one of those states by 10 percentage points. It's important for us to be competitive in these states.

If you take all the votes that have come in this year, Hillary has got more votes -- more people voted for Hillary Clinton not only than any candidate running this time, but any candidate in the history of our party. Yesterday, over 60,000 people went to HillaryClinton.com -- brand new people -- to say I want to help this woman. I think she is a game changer.

KING: All right...

MCAULIFFE: It would be our first woman president. But she -- more importantly, she's going to fight for you on jobs.

KING: We'll have... MCAULIFFE: You've -- that's what people care about. And that's what the issue is. That's why she continues to win and we're going to win here in Indiana.

KING: We'll have David respond right after these words.

Don't go away.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

RICHARDSON: Now, all of a sudden, the presidency is slipping away and they'll do anything to keep it.

CARVILLE: As opposed to whining about negative commercials, as opposed to whining about this or that, let the two of them have the debate. Let them explain their positions.

(END VIDEO CLIP)

KING: By the way, the other portion of our interview with Speaker Pelosi will air near at the top of the -- near the top of the hour.

David Wilhelm, the rap on Obama that seems to be the latest among punditry is that he can't close this deal.

How do you respond to that?

WILHELM: Well, I guess I respond to that by saying that question could be posed to either candidate. And I -- you know, I guess I'm not going to try to spin this one. He can't close this deal in part because Senator Clinton is a very good candidate.

And there's nothing wrong with saying that. And I think when he prevails -- and I think it's when. When Senator Obama prevails and people look at this in the context of history, he will be given credit for having engaged in one of the most amazing races in the history of American politics, overcoming immense institutional organizational advantages that Senator Clinton had going into this race and doing it with a profound message of change, extraordinary grassroots energy, bringing in Independents, bringing in young people, bringing this country together.

So she is good. She's a tough candidate. Senator Obama is going to prevail.

KING: And would you say, Terry, the same thing about Senator Obama?

MCAULIFFE: Sure. This has been a great race. I mean, when you think about it, we've had 29 million votes cast and the difference is less than 1 percent. It's been a great race. And I happen to be one of the Democrats who think this is good for the Democratic Party. You know, I'm here for a record crowd here in Hamilton County, Indiana. They've never had a crowd this big. That's good because this contest is going on and the same thing is happening in North Carolina. Hillary was down in North Carolina today with the former chairman of the Joint Chiefs of Staff, Hugh Shelton, campaigning all over the state. Huge crowds.

I think this is great. And I think Senator Obama has run a spectacular campaign. This is the Democratic Party. We'll come together after the last votes are done in June.

But I would, what you mentioned James Carville earlier -- Senator Obama refuses to debate us in North Carolina. CBS, Katie Couric had arranged for it. We'd agreed to it.

I'm here in Indiana today. The Independent Commission here in Indiana is requesting the Obama campaign to agree to debate. We've accepted it.

Let's have a debate between the two candidates. We've only hand four with the two candidates.

Why is he scared to debate Hillary Clinton?

KING: David?

MCAULIFFE: He wouldn't do it in North Carolina.

WILHELM: Well...

MCAULIFFE: He won't do it here in Indiana.

WILHELM: It's...

MCAULIFFE: Please, Senator Obama, engage in the debate.

KING: David?

WILHELM: It's absurd to suggest that Senator Obama is scared to debate. He's debated 21 times. I don't get a sense that the American people are crying out give us that 22nd debate. I don't get a sense of that whatsoever. And what happens in campaigns is that candidates who are behind -- and especially candidates that don't have the same amount of money -- start calling for debates. They want to debate every day. They want to debate every night. It provides oxygen to their candidacy. I get that.

If the tables were reversed, Senator Clinton would not be wanting to debate. I guarantee you.

So we've had 21, it's absurd to suggest that he's running from debates. I think we've had plenty of debates.

KING: Terry, what's one more going to prove?

MCAULIFFE: Well, hey, actually it's been 23, but who's counting? But we've only had four between the two candidates running for president at this stage. I think we saw the other day, it was the highest viewership any of them ever had -- 10 million people the other day. This was going to be after "Meet" -- after the "60 Minutes." So it would have been a huge viewership. I think the voters here in Indiana, where I am right now, I think the voters in North Carolina ought to see the two finalists.

Why won't he debate Hillary?

Listen, after yesterday we've got plenty of money. I don't think anyone thinks Hillary has plenty of oxygen. I think we take up quite a bit of space.

It's about debating the issues, getting substantive on health care, the credit crisis, all of the things that people want us to talk about.

Why is he scared to debate Hillary Clinton?

Go on stage. Because let me tell you, Larry, the fall campaign -- if you think is tough, wait until we get to the fall and John McCain and the Republicans and the 527s will not stop.

So let's get through this process now.

KING: You think he's scared, David?

WILHELM: No. That's -- it's ludicrous. We had lots of debates. Senator Obama has done very well in debates. And I guess I'd like to challenge, just for a second, the notion that's constantly put forward by Senator Clinton's -- Senator Clinton herself and her campaign -- that oh, boy, we can get down and dirty because you know what, the Republicans are going to be even more down and dirty. And we've got to have a nominee that's going to be the toughest when it comes to their down and dirtiness.

But you know what?

I actually don't think that's what we need in a nominee. I think what we need in a nominee is somebody who can put forward a positive Democratic message, somebody who can unify this country, somebody who can force the Republicans to respond to us on the change that's needed in Iraq, the change that's needed in this economy.

And I think kind of this fundamental premise that we need somebody who can -- you know, down and dirty is the nature of our political system -- no. We need to lift ourselves up. And I think that's one of the great appeals of Senator Obama.

KING: Thank you both very much.

We'll be hearing lots from both of you.

David Wilhelm...

MCAULIFFE: Right. I don't think a debate on issues is down and dirty.

KING: Terry McAuliffe...

MCAULIFFE: That's what we need. We need a debate.

KING: OK. OK, Terry.

MCAULIFFE: Thank you.

KING: Terry McAuliffe...

MCAULIFFE: All right, Larry.

KING: ...and David Wilhelm.

MCAULIFFE: Great.

Nice debate.

WILHELM: Thank you.

KING: More of our interview with House Speaker Nancy Pelosi still ahead on LARRY KING LIVE.

(BEGIN VIDEO CLIP)

KING: What's it like to work with the president?

(END VIDEO CLIP)

(COMMERCIAL BREAK)

KING: Speaker Pelosi later.

David Wilhelm remains with us.

Joining us now in Washington, Lanny Davis, who was special counsel to President Clinton and is a strong supporter of Hillary's.

In Fargo, North Dakota, our old friend, Ed Schultz, talk radio host and a backer of Barack Obama.

And in New York, Lisa Caputo, who was press secretary for First Lady Hillary Clinton and deputy assistant to President Clinton and is a supporter of Hillary Clinton.

David Broder, Lanny, wrote today in "The Washington Post": "For the battle weary Democrats, the big news out of Pennsylvania is pretty simple -- their nightmare continues."

Is this a nightmare?

LANNY DAVIS, CLINTON SUPPORTER: No. I agree with my old friend David Wilhelm and Terry that we have two great candidates, two strong candidates, who agree on every major issue. And it's a tough battle, and the partisans like me are often at war with one another on programs like yours. But the big issues bring people together; getting out of Iraq, solving the problems of the economy, gas prices, and certainly, international relations. These two are in agreement on the big issues. That's what really counts.

KING: Ed, is Senator Obama slipping?

ED SCHULTZ, OBAMA SUPPORTER: No, I don't think he is, Larry. I think there's a little bit of momentum for Senator Clinton coming out of Pennsylvania. But ten delegates isn't a whole lot of momentum. You know, it's really almost insulting for the Clinton camp to say they are leading in the popular vote. You know, Barack Obama wasn't even on the ballot in Michigan. It's easy to win when your opponent doesn't show up.

And if Lanny is a believer in the numbers, how about 30 states versus 15 states, Lanny. Are you ready to say tonight on LARRY KING that those 30 states don't matter? The tone of this debate and disbelief in numbers that is really turning people off.

DAVIS: I know that you're in Fargo. I love you, Ed, but if you are comparing wins in Utah, Fargo, North Dakota, and the great Democratic state of Wyoming to Ohio, Pennsylvania, New Jersey and the battleground states, where Democrats have to win, your math may be fine, but you don't win the presidency with your math.

SCHULTZ: You know, Lanny, maybe you can tell me what new states is Senator Clinton going to win? Is she going to win Colorado? Is she going to win Iowa? Is she going to win Virginia?

DAVIS: Start with Ohio, Ed, where your candidate --

(CROSSTALK)

SCHULTZ: John McCain is not going to win Ohio. He went to Ohio and said that NAFTA is a good thing.

(CROSSTALK)

DAVIS: The numbers are Obama is behind in Ohio.

KING: Lisa, can you do the math that can make Hillary win?

LISA CAPUTO, FMR CLINTON PRESS SECRETARY: Larry, I don't know about that --

KING: That's what counts.

CAPUTO: Wait a minute. Don't forget, both of these candidates are going to need the superdelegates. You're going to go into this with neither one of them having enough pledged delegates to seal the nomination. So, it's going to go to the superdelegates. And then it goes to the will of the people. What you keep hearing all of the superdelegates saying, who remain uncommitted, and you hear both candidates saying, that the superdelegates should go with the will of the people.

Now, for the statement to be made that the popular vote doesn't count, I don't think is a fair argument. There's no question --

SCHULTZ: That's not what I said.

CAPUTO: There's no question that the popular vote counts when it comes to the superdelegates. It will all come down to the superdelegates deciding this race.

KING: David Wilhelm, is that fair? Is the superdelegates democracy?

WILHELM: Well, superdelegates constitute the rules of the Democratic party.

KING: I know, but it is Democratic?

WILHELM: It's not pure democracy, but they are the rules that everybody agreed to, so superdelegates are part of the process, and we both need to play by them. Now, it's interesting that since Super Tuesday, Barack Obama's picked up a net of 84 new superdelegates, and Senator Clinton has picked up a net of five. So, I think superdelegates and rank and file Democrats, as they look at the nature of this race, and the tone of this race, they're coming to the conclusion that we need to rally around Senator Obama.

But we have a process in place. Both campaigns need to play by the rules. The rules suggest that we elect delegates. Delegates are how we nominate our nominee. And that's the way it's going to be. Those are the rules of the game, and Senator Obama has a significant and impenetrable lead among delegates.

KING: Thank you very much, David. Sorry, we have such limited time. Lisa, thank you.

Lanny and Ed will be back. Plus, we'll add a Republican strategist and a McCain supporter to the mix. Don't go away.

(COMMERCIAL BREAK)

KING: Wow. Lanny Davis and Ed Schultz remain with us. And we're joined by Michelle Laxalt, Republican strategist, supporter of John McCain, and son (sic) of the great Senator Paul Laxalt of Nevada.

All right, Michelle, what do you make of all this rumbling?

MICHELLE LAXALT, REPUBLICAN STRATEGIST: Between the Democrats?

KING: Yes.

LAXALT: Makes my day.

KING: Can only help?

LAXALT: It can only help, absolutely. Senator McCain comes into this, any Republican does, as a distant long shot by any stretch of the imagination. Historically, the number of times that one party's held a presidency for more than two successive terms has been, I think, once since Eisenhower, and that was when the first President Bush succeeded President Reagan. So, history is against Senator McCain, and the Bush unpopularity is, as well.

KING: Lanny, are you feeding into them?

DAVIS: I have a great deal of respect for Senator McCain, and can I only say positive things about him. I disagree with him on the war, and several other issues. But if you look at today's national battleground states, that's where Democrats have to win, Pennsylvania, Ohio, Florida and Michigan, three out of those four. Hillary Clinton is beating John McCain in all of those states --

KING: In the polls.

DAVIS: In the polls, in the general election polls, and Obama is losing. And in Massachusetts, as we speak, the most recent poll, Larry, the most reliably Democratic state, Obama is in a dead heat and we're up 15 over John McCain.

KING: How do you help her? When you say that, if Obama is the candidate, John McCain can now say, I'm going to win three out of four. Lanny Davis said so.

DAVIS: Barack Obama has to show people why he can't carry working class voters. It's not John McCain's fault. It's not my fault. He didn't do it in Pennsylvania. He didn't do it in Ohio. He --

LAXALT: He has a 160-delegate lead. That's simple math.

DAVIS: He has to show he can win --

KING: Do you think they're playing into the Republican's hands, Ed?

SCHULTZ: I think November is a long way away, Larry, and I think what happens in April may not hurt the Democrats, if the healing process -- if these two candidates, the one who loses, really stays engaged and brings the base, their supporters along with it. I'm watching your program last night, Larry, and James Carville and Governor Richardson are going at it.

The first thing that struck me is, gosh, wait until these two guys get on the same team. I don't think John McCain is going to be that hard to beat. I really don't. I don't think John McCain can go to Ohio and say NAFTA is a good thing.

KING: Laura and Jenna were on LARRY KING LIVE last night. A bit of a surprise when I asked them who they were supporting in the presidential race. Take a look.

(BEGIN VIDEO CLIP)

KING: Do you have a favorite between the two Democrats?

LAURA BUSH, FIRST LADY: My favorite is the Republican. KING: Yours too, I would imagine.

JENNA BUSH, DAUGHTER OF PRESIDENT BUSH: I don't know.

KING: Ah ha. Are you open to?

J. BUSH: Yes, of course, who isn't open to learning about the candidates. But, I mean -- and I'm sure everybody is like that. But I really -- I honestly have been too busy with books to really pay that much attention.

(END VIDEO CLIP)

KING: Surprising, Michelle? Jenna is open to the Democratic nominee?

LAXALT: Probably to her own family, but to the average American, who is watching her, a young lady such as she is probably more in step with the rest of the country, which is, are they really looking microscopically at this process right now, or are they focusing on ending the school year, getting prepared for the fall, looking at their summer vacations. In my estimation, the vast majority of the American people are like Miss Bush, and they are not going to truly focus until about Labor Day.

KING: Can Hillary win this?

DAVIS: Well, right now --

KING: Logically?

DAVIS: Right now, she's showing strength in the battleground states against John McCain. He's a tough candidate. Obama is showing weakness against McCain in the battleground states.

KING: Can she win the nomination?

DAVIS: I thought you meant the general election. She can win the nomination because Democrats are not going to be in a suicide pact if it's clear that Barack Obama cannot connect with the working class base of our party. No candidate has ever won the presidency without the base of their party. Right now, Barack Obama has no answer to the question, why can't you win working class Democrats.

KING: Ed, is she right?

SCHULTZ: I think that Barack Obama is not going to have any problem motivating Democrats when he wins the nomination. I think this talk about battleground states is really a straw-man. Who says a Democrat's not going to win California and New York and Pennsylvania and Ohio? John McCain's not going to win Ohio. He goes to Ohio and says NAFTA is a good thing. He goes to Iowa and says he's against ethanol.

If the Democrats want to sit there and bank on Florida, which has been nothing but a graveyard to the Democrats -- the question is this, Larry: what new states in the '08 map are the Democrats going to bring? Obama can win Colorado. He can win Iowa. And he can win Virginia. Notice the Clinton camp never talks about what new states they are going to bring to the '08 map.

DAVIS: You interrupted me because you didn't like my answer. Ohio would have won the presidency for John Kerry by 150,000 vote switch. Right now, Hillary Clinton is up nine points against John McCain in Ohio. And Obama is losing in Ohio to John McCain.

SCHULTZ: That's a straw-man argument, Lanny, and you know that.

DAVIS: That is a fact.

KING: And Michelle is smiling. House Speaker Nancy Pelosi will be back with me -- thanks, guys -- right after the break.

(COMMERCIAL BREAK)

(BEGIN VIDEOTAPE)

KING: We're back with the Speaker of the House, Nancy Pelosi. The new war-funding bill, Bush says he wants 108 billion. He says he'll veto anything higher. I want to get this right. A lot of Democrats want to add on funds for unemployment, education, infrastructure, et cetera.

How are you going to resolve this? He won't sign it if you do that.

PELOSI: Well, let's hope that we can work this out so that the president will get a bill that he can sign. But we don't have to have all of those things in this -- in this bill.

I do think, though, that we should do something very magnificent about infrastructure. Two hundred years ago, Larry, 200 years ago President Jefferson tasked his secretary of the treasury to build an infrastructure plan for America, to follow the Wharton (ph) and Clark expedition and the Louisiana Purchase, the Cumberland Road, the Erie Canal, things like that.

A hundred years later, Teddy Roosevelt in the White House did a similar thing on the anniversary. And he instituted the National Park Service to preserve the green infrastructure of America.

Another hundred years later, we want to do something with that kind of vision to rebuild America. And that's what we would hope we can work with the president to do. But it doesn't have to be in that bill.

KING: So you're not going to have a fight over this?

PELOSI: Well, I hope not. I mean, there's certain things that are emergencies that the president, the administration has told us there is a need. And perhaps we can have some of that in the bill. And I do think the worsening economy might call for unemployment insurance for people who have lost their jobs. But we can work that out.

KING: But you are voting for war funding?

PELOSI: I won't be voting for war funding.

KING: The bill is --

PELOSI: I haven't voted (ph) for war funding. But, in the event, there will be some who will vote for war funding, yes. I mean, I have voted for it on the condition that the funds be used to wind down the war and bring our troops home. Perhaps I will have an opportunity to do something like that.

But we haven't finalized the supplemental bill. The chairmen of the committees are working together, House and Senate. And hopefully, we can have a bipartisan bill that the president will sign. We always try to start there. Where can we find our common ground?

KING: You assume he starts there, too?

PELOSI: Well, I hope so. I have to -- I hope that.

KING: What's it like to work with the president?

PELOSI: The president and I have a fine relationship, I think.

KING: You like him?

PELOSI: Personally, yes. It's not -- it's not anything personal. I just don't like his policies. I think that he's taken us into war and that he's taken us into debt, that he's taken us into recession that lost us life, reputation and dollars, ability -- capability of our military to protect America's interest wherever they're sent. It's huge.

I think missed opportunity on energy independence and reversing global warming, missed opportunity -- there's so much we could have done. But it's just a matter of months, and we'll be able to do it.

KING: My late friend, Tip O'Neill, told me he argued frequently with President Reagan but never with animosity.

PELOSI: No.

KING: Do you argue?

PELOSI: Yes, but I think he understands, as do I, he has to do what he has to do, and I have to do what I have to do. And I have to try to find common ground and then stand my ground, the ground for the Congress when we don't find that.

But the president was here yesterday. We gave the Congressional Gold Medal to Michael DeBakey. Can you just imagine? Ninety-nine years old?

KING: Amazing. PELOSI: And we had a very amiable conversation. Now, it's not personal. And you know the president is -- is not that kind of a person. He's not a bitter kind of a person. So -- and I certainly respect our differences of opinion. But I have very serious differences of opinion with the president.

KING: You met with the Dalai Lama. You urged the president to, what, skip -- not go to the opening of the Olympics?

PELOSI: Well, I've said to the president to reserve judgment on that. Let's see if we could see if the Chinese government would do something to negotiate with the Dalai Lama.

That would be very important to do, and I think some testimony from the administration is leaning in the direction of encouraging that negotiation. But I don't know what the president's plans will be.

If the president goes to the opening ceremony and at some time in his conversations with the Chinese government, I hope he talks to them about the enormous trade deficit that we have with China, $750 billion each year, about human rights violations in China.

It's about those kinds of issues. It's about helping us to end the genocide in Darfur, where the Chinese could be helpful with the Sudanese government. There's a whole list of things --

KING: You don't expect the Chinese to change on the Dalai Lama, do you?

PELOSI: Well, I'm always hopeful. I would hope, because the Dalai Lama -- the way the Chinese characterize the Dalai Lama's position is to say for independence. He hasn't been for at least 21 years that I have known him and worked with him. He's always been for autonomy within China.

So I think, if they could take a clear look at what his holiness is saying, that they could find some common ground. I would hope so, because otherwise a whole culture, a whole Tibetan culture will be destroyed.

KING: We'll be right back with Speaker Pelosi right after this.

(COMMERCIAL BREAK)

KING: We're back with the Speaker of the House, Nancy Pelosi.

Where are you on this Colombia trade agreement?

PELOSI: Well, I have said to the president that I will determine the timetable in which it comes to the floor of the House and that we should continue our conversations and perhaps find a way to bring it to the floor.

KING: Are you holding it up?

PELOSI: No, we're not holding it up. The president wanted it on his timetable. And as speaker of the House --

KING: Want it on yours?

PELOSI: -- want it on mine.

KING: And you win this one, right?

PELOSI: Well, again, I don't put myself in a place that says, "No, never," to the Colombia free trade agreement. I think that there could be a way that -- I've said to the president: We must address the economic concerns of America's working families, and then we can have a trade agreement.

And that means we have to have an initiative for job creation, that gives them some economic security.

KING: So reports that you want it killed are not true, not true?

PELOSI: Not true.

KING: A couple of other things. What about this job -- now, you've been on it two years, right?

PELOSI: Yes.

KING: -- surprises --

PELOSI: About 15 months.

KING: -- surprises you?

PELOSI: What about it surprises me? I rarely use the word "surprise" in politics, because you're always thinking what the possibilities could be. You're always watching motivation and you're studying people.

If I would say anything that I wish were different it would have been that we could have found some common ground with the president on the war, that the Republicans who are up for re-election are facing a public that 63 percent of whom say it wasn't worth it, not only do they oppose it, it wasn't worth it.

At the height of the opposition to the war in Vietnam, it was 61 percent, if that gives you any indication. And the fact that the Republicans just are sticking with the president with the failed policy in Iraq is, I think, if not surprising, enormously disappointing.

KING: But nothing about the job has surprised you --

PELOSI: No --

KING: -- the working?

PELOSI: The one thing about it is -- let me first say what a great honor to be the speaker of the House and what a great honor to be the first woman speaker of the House and, I might add, first Italian-American speaker of the House. It's absolutely great. And I congratulate my colleagues for having the courage to honor the legacy and hope of our country, which is equal opportunity.

The fact is your time is not your own. You know, you think you're going to do these things, and every intervention you can imagine comes up. Working on the farm bill today or the intelligence bill, things come up that you just have to stop everything and address. It's pretty exciting, though. I don't see that as a complaint. I just say it as an observation.

KING: You mention Iraq. I guess the most famous anti-war activist, Cindy Sheehan, is going to run against you.

PELOSI: Yes, she certainly is.

KING: In the Democratic primary?

PELOSI: No, as an independent.

KING: She's running as an independent. Would you debate her? How do you view that?

PELOSI: Well --

(CROSSTALK)

KING: I guess you share her views, don't you?

PELOSI: Yes, well, God bless her. And I think it's a reflection of the dissatisfaction that people have that we have not been able to end the war. But we were hoping that the president would pay more attention to the wishes of the American people, not turn a tin ear to them and a blind eye to what's actually happening in Iraq, but God bless her for her advocacy.

Cindy Sheehan lost her son in Iraq. And so she has all of my sympathy, respect for her sacrifice that her family has made.

KING: Are you surprised she picked you to run against?

PELOSI: I don't even think about it much. You know, I have a day job. We're here trying to --

KING: OK.

PELOSI: You know, we just passed working with the president, our stimulus package, and May 2, the stimulus checks will start to go out. We're working on it --

KING: Six hundred dollars or $1,200, depending on --

PELOSI: Depending, an average of $800, but 150 million families, starting May 1 and going on for a number of weeks, will be receiving these rebate checks. Millions of families who never received them before, families with children and the rest who didn't reach a certain --

KING: You do have a day job.

PELOSI: I do have a day job.

KING: Thank you.

PELOSI: And I love it.

Thank you, Larry.

(END VIDEOTAPE)

KING: We're open 24/7 at LARRY KING LIVE. Head now to our Web site, CNN.com/larryking. We've got transcripts. We've got our guest schedule there, and you can e-mail us or download our latest podcast.

Pamela Anderson is here tomorrow night. What's she doing in Washington? Find out.

And crime buster John Walsh stops by to celebrate 1,000 captures. That's LARRY KING LIVE Friday night from the nation's capital.

Time now for Campbell Brown, sitting in for Anderson Cooper, and "A.C. 360."

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