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Issue Number One

Senator Hillary Clinton Speaks in High Point, North Carolina; Senator McCain on the Economy; Enron Loophole

Aired May 05, 2008 - 12:00   ET

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

SEN. HILLARY CLINTON, (D) PRESIDENTIAL CANDIDATE: Or take Brazil, Brazil decided they did not want to be living and dying by how much oil went to. Today, just as I was getting out of the car I got an e- mail message, for the first time in history oil is now over $120 a barrel and we are over the barrel of the oil-producing countries and companies because we refuse to say we're not going to put up with it. Well Brazil, they decided to look and see what they made. They grow a lot of sugar cane. They started experimenting 30 years ago. They never gave up. They kept at it. So what do you know? They are now energy independent when it comes to fueling their cars because they can mix enough gasoline with enough ethanol from sugar cane that they don't have to worry about the price being so outrageous.
I think we could be equally efficient, equally smart, equally effective. We also need to invest in our infrastructure, our roads, our bridges, our tunnels. And I do believe we should be looking at high-speed rail. There are a lot of places in this country where it would be effective, particularly along the east and west coasts and along some other routes. We need to be looking to expand and complete our broadband infrastructure. Every place in America should be connected up to high-speed Internet access. Because other countries are way ahead of us and that means in towns just like High Point you might not be as competitive when it comes to the global information superhighway as you need to be, and we've got to start investing in science and research again.

Under George Bush, the budget for the national institutes of health and the national cancer institute and all the other scientific enterprises of our government have fallen. We are falling behind. And we are on the brink of so many breakthroughs on autism and Alzheimer's and Parkinson's and juvenile diabetes and heart disease and all kinds of cancer, if we start investing again it's not only going to save lives and alleviate suffering but it's going to put a lot of people to work because there is much to be done to translate those discoveries into products. And then, once we get all of these great breakthroughs, let's be sure that every American has access to quality, affordable health care. That is what I have proposed. That is what I will do.

I have a plan that is not government medicine. It's not government-run medicine. It's not new bureaucracy. It takes a program that already exists, the plan by which members of congress and federal employees, about 9 million of them, get their health care. We're going to open it up to every other American and we're going to give you the financial support you need to be able to pick among all of the choices that are there. And it's going to be health care that covers prevention and mental health because we waste money because we will not provide health coverage for preventive services. And we cause untold misery because we won't face up to the fact that mental health care is health care and people deserve to get the kind of services they need to be taken care of.

We're going to make sure education remains the passport to opportunity. I love what the governor's done in preschool education and pre kindergarten. And we're going to be a good partner with North Carolina because you deserve to have a president who helps you do this important work because it pays off. You know a good pre kindergarten program will help to cut the achievement gap in 50 percent by the end of high school. That's a good investment. That's the kind of investment the federal government should be making in programs that work, not what they're doing now, which is why I'm going to end no child left behind because it is not working. It is a one-size fits all program that turns our kids into test takers and our teachers into test givers, and I don't think that's the best approach for us to get the kind of educated citizenry and productive workforce that we need in the future. We're also going to make college affordable.

You know, Michael mentioned that, he's 100 percent right. In this country, we should be investing in our young people, and that means making it possible for them to afford to go to college. The percentage of our young people going to college is dropping because it's so expensive to start. If you actually get started, they raise the costs on you halfway through and you can't go on, or you have to take on so much debt. Well that's not the way it was when I was going to school. My dad could pay for college but I had to work to buy everything like a book or anything else I needed. When I went to law school, he couldn't help me. So I kept working. I got a little scholarship and I borrowed money directly from the federal government, at about two, three percent interest. That's what I want young people today to be able to do because all across North Carolina, when I ask young folks who are in school now or maybe just got out what interest rate they're paying, I've been shocked. 18, 20, 25, 27 percent interest.

So here's what I would do double the college tax credit so you get to keep more of your own money to send your own children to college. Make sure you've got a Pell grant that has a rising amount to it, connect it with the rising cost of higher education and that financial aid form known as FAFSA that families fill out, they get the end of it and they're told, just kidding, you're not going to get help. Provide more national service where young people can earn up to $10,000 a year that would go right towards college. Take on the predatory student loan companies and the banks that are charging these outrageous rates of interest. Move back to direct lending. And for those of you with a high rate of interest, we're going to give you an offer. If you're willing to do public service like teaching, nursing, law enforcement, we will forgive your student loans overtime so you'll get yourself out of debt.

So these are some of the very specific plans I've put forth. And I think people like to hear what I'm going to do because I want you to hold me accountable. I don't want there to be any guesswork. You know, a lot of good folks voted for President Bush back in 2000 because he told everybody he was something called a compassionate conservative, and that sounded really good, but nobody knew what it meant. You get into the specifics, which I think you know, is important in an election, and you figure out, ok, where does this person really stand, where have they been, what have they done, what are they going to do, and that's what we need because I think President Bush forgot that he works for the American people. You hire the president of the United States. And we also need to do more around the world to raise our standing and resume our leadership and that begins by ending the war in Iraq and bringing our troops home as quickly and responsibly as possible.

Now, I have said that upon being inaugurated I would ask the secretary of defense and the Joint Chiefs of Staff and my security advisers to give me a plan that would enable me to start bringing our troops home within 60 days. I know this has to be done carefully. It is dangerous withdrawing troops. You have to take our troops and our equipment out the same roads they came in, roads that have been bombed, time and time again with those improvised explosive devices and the other bombs that have been used to kill and maim our young men and women, so this has to be planned carefully. But it's the right thing to do. Because the Iraqis have to know they must take responsibility for their own future. They no longer will have a blank check from the United States. They've got to make the decision about what kind of lives they want. You know, I have been --

GERRI WILLIS, CNN ANCHOR: You've been listening to Senator Hillary Clinton speaking in High Point, North Carolina, covering a variety of topics, everything from the economy to green investments to education. You're watching ISSUE #1, I'm Gerri Willis. Ali Velshi will be along in just a moment. Senator Barack Obama will be speaking in just a few moments. We'll be right back.

(COMMERCIAL BREAK)

WILLIS: We're rejoining Senator Hillary Clinton in High Point, North Carolina, who is talking about rising gas prices.

CLINTON: -- an executive of Exxon Mobil testified to a committee in the House of Representatives that the price of oil is not a reflection of market fundamentals, namely, supply and demand. That, in fact, his testimony, under oath, was that if you just look at the market fundamentals, the price should be 50 or $55 a barrel. Other testimony and investigation has proved that at least $20 can't be explained by any kind of risk analysis. So why don't we investigate them? Why don't we close the so-called Enron loophole?

Why don't we get back to regulating them so they are not the tail wagging the American dog and making the costs go up and up and up? And I'll tell you, we're also going to quit putting oil into the strategic petroleum reserve and release some, which will help to put downward pressure on prices. We're going to go after OPEC, which remember is a monopoly cartel, there's nothing free market about it. They sit in some conference room a couple of times a year, decide how much oil they're going to produce and how much they're going to charge for it. So let's change our laws so we can sue them on antitrust reason and go to the World Trade Organization with them. And then let's try to provide some real time relief for all of you. I want the oil companies, out of their excess profits to pay the gas tax this summer instead of having you pay it.

This is a big difference in this campaign. You know, Senator McCain wants to have a gas tax holiday but doesn't want to pay for it. Well, we've been down that road, we cannot increase the deficit. We cannot take money out of the highway trust fund that would be a mistake. Senator Obama wants you to pay the gas tax this summer instead of trying to get it to the oil companies to pay it out of their record profit. I believe that we should start standing up for the vast majority of Americans who are paying these outrageous gas prices. It's affecting your incomes and your budget. You know, according to the department of energy, the average American would save about $70 this summer. Maybe for some people, that's not much money, just pocket change. For a lot of people I talk to, who are counting every single penny because gas is up, groceries are up, health care is up, they're threatened with home foreclosures, some of them, everything is going up.

For truck drivers, truck drivers would save $2 billion this summer. That's $2 billion that wouldn't go into the base of our food costs. So I'm ready to take on the oil companies. I voted against them in 2005 for Dick Cheney's oil bill. But this is part of a larger difference between my opponent and me. I have been saying for over a year, we need to take on the wall street bankers and the mortgage companies that misled so many people into these sub prime mortgages, putting so many of their homes at risk. You know, it is tragic, because I meet these folks and most of them are really hard-working people. Some of them are the first homes that they ever bought, they were misled, they were given inflated appraisals that were not reflective of the true cost of the house, but boosted the commission that went to the broker. They are given hundreds of pages of fine print.

The saddest stories I hear are from people who are so excited about having their first home that they decide they want to tray to pay their mortgage off early. So they stick in a little extra every time they send in the mortgage. Not knowing that buried in all of that fine print is what's called a prepayment penalty, which triggers a higher interest rate. So here are folks really trying to do the right thing who find themselves out on the street.

So I've been saying for over a year, crack down on this, freeze these home foreclosures, give people a chance to stay in their homes because some of them can pay what they're paying now, they just can't pay it when it goes up. We have 2 million households that are possibly going to be evicted this coming year. Freeze these interest rates, freeze these home foreclosures. Senator Obama disagrees.

I believe that part of the job of a president is not just for long-term planning, which I am 100 percent in favor of, but living in the here and now to try to make it clear to American families, middle class people, hard-working folks, that somebody hears you and somebody sees you and somebody knows what's going on right here in High Point, North Carolina. I can't do any of this without your help tomorrow. This has been an exciting campaign across North Carolina. We have had the best time. We have eaten barbecue from one end of this state to the other. You know, for a while I was a little worried because every sighting of my husband was going into or coming out of a barbecue joint. And I said, oh I hope his cardiologist doesn't read that. But then I kind of got into the swing of it, too. The only question, I will not answer in this campaign is which is the best barbecue. I have made plenty of mistakes in my life, but I'm not walking into that one.

But tomorrow is a historic decision for all of us because we got to get it right. And we got to make sure that we are prepared to face the challenges and seize the opportunities that America confronts. I am confident and optimistic. People ask me all the time, this is going to be so hard. I say, yes, it is, it's going to be especially hard following President Bush and Vice President Cheney. It's always the hardest job but we're going to have a lot of repair work to do. We're going to have a lot of cleaning to do. We're going to have to really understand what it takes to make our country move forward with a kind of positive view of the future that is part of the American birth right. But we can do this. And when I say "we," I mean all of us.

I'm going to fight for a clean, renewable energy plan for America, but I'm going to ask you to be more energy efficient. Turn off those lights when you leave a room. Use those compact fluorescent bulbs. Think about what each of us in our daily lives can do to cut down expenditure on fossil-based fuels, especially those that are so bad for the environment. And I'm going to ask you, when it comes to health care, yes, I'm going to move toward a universal health care system. Nobody will be left out. Not a single person. You know, that's another big difference between me and Senator Obama. He leaves about 15 million people out. That will never work. If you leave that many people out, the insurance companies will still be in charge, the emergency rooms will still be taking care of people who have nowhere else to go.

Everybody needs to be in it. But also everybody needs to take better care of themselves. Look, that's something we all have to do. All kidding aside, especially for our kids. Because you go and talk to any doctor, they'll tell you they're seeing children, I mean 10, 11, 12-year-old children being diagnosed with type II adult onset diabetes. They're not eating right, they're not moving. That's a terrible sentence to inflict on a child. So we've got work to do. When it comes to education, you can be the governor and have preschool programs. I can get rid of no child left behind, we can make college affordable, but families have to help their kids understand that school is your work.

You've got to do your part to learn what you must learn to be successful in today's economy. So I'm asking for your help tomorrow. I believe that we have everything at stake in this election. I am running because I think with all my heart that I am best prepared to be the president and I am the stronger candidate to take on John McCain in the fall.

WILLIS: You've been listening to Senator Hillary Clinton speaking in High Point, North Carolina. You're going to want to stay with us because Senator Barack Obama is coming in just a few minutes. Stay with us, this is ISSUE #1.

(COMMERCIAL BREAK)

WILLIS: The scramble for votes is on as both democratic candidates are racing all over North Carolina and Indiana this hour trying to secure every possible vote. Welcome back to the special edition of ISSUE #1. CNN's best political team in television and the CNN Money team are all over this primary and ISSUE #1, your economy. Let's turn to Jessica Yellin live at the CNN election express in Indianapolis. Hi there, Jessica.

JESSICA YELLIN, CNN CORRESPONDENT: Hi Gerri. The candidates are campaigning furiously, hopscotching between Indiana and North Carolina today. Senator Clinton as you know has been holding an event in High Point, North Carolina, both she and Barack Obama emphasizing that they are going to do more to help the average American. They say they're not going to focus on the wealthy but to really help the little guy. One message you hear from both of them is they will be a fighter for average Americans. Let's listen to them.

(BEGIN VIDEO CLIP)

SEN. BARACK OBAMA, (D) PRESIDENTIAL CANDIDATE: We feel very confident about the fact that the American people are interested in who's going to be fighting for them, who's going to make sure that they're living out their American dream, who's going to make sure that college is affordable for their kids, the jobs are here, and that's ultimately what this is about.

SEN. HILLARY CLINTON, (D) PRESIDENTIAL CANDIDATE: But what we have to recognize is that this is more like a hiring decision, who are you going to hire to tackle all of these tough problems for you? Somebody who understands what you're going through, cares about it, gets it and will stand up there every day and fight for you. The wealthy and the well-connected have had their president. It's time that the rest of America, the hard working, middle class families had a president on their side again.

(END OF VIDEO CLIP)

YELLIN: We have heard both the candidates focus especially on the talk of a gas tax holiday. I know you've addressed that considerably on your show, and also health care reform. And they both promise to be more attentive to what is really going on in the economy. As you know, the race here in Indiana is particularly tight. And we expect to see both candidates back here this evening. Barack Obama, in fact, is going to be holding a rally where I am right now later tonight. Gerri?

WILLIS: Jessica, you can tell they're going for the little guy because they keep dropping their G's in all their speeches. But tell us about Indiana here, I know people are watching this really closely. What should we be watching for? How can a win there for either candidate change this race?

YELLIN: Well Barack Obama himself said this state could be a tiebreaker, meaning essentially if Barack Obama were to win Indiana tomorrow by a lot that could really damage Senator Clinton's chances of becoming the nominee so much so that some people have suggested that would be enough to say, Senator Clinton, it's time to get out of the race. So far it does not look like he's going to run away with the hefty lead. Who knows? But again, a win for Barack Obama could be a decisive blow to Senator Hillary Clinton. On the other hand if she does very well here tomorrow, that really puts a win behind her sails and we'll see this fight continue to be as fierce as it has been through the June 3rd primary. Gerri?

WILLIS: A fight to the end. Jessica Yellin, thank you for that.

ALI VELSHI, CNN ANCHOR: Both senators Clinton and Obama are working hard to try to appeal to working class voters. CNN correspondent Dan Lothian takes a look at their blue collar economic strategies.

(BEGIN VIDEOTAPE)

DAN LOTHIAN, CNN CORRESPONDENT (voice-over): A tough economy has many people like Indiana social worker Colleen Scheu tightening their budgets.

COLLEEN SCHEU, INDIANAPOLIS RESIDENT: We were trying to save money more and we're trying to -- I know we've gone to some more used clothing stores for our kids.

LOTHIAN: Senator Barack Obama says real leadership is needed to make life a little easier for struggling Americans.

SEN. BARACK OBAMA, (D) PRESIDENTIAL CANDIDATE: A big part of why so many folks are struggling is that Washington hasn't been looking out for them.

LOTHIAN: Obama says a gas tax holiday, to ease some of the pain, is nothing more than a gimmick. He attacked Senator Clinton's proposal in a new TV ad airing across Indiana.

UNIDENTIFIED MALE: It's an election year gimmick, saving Hoosiers just pennies a day.

LOTHIAN: Senator Clinton paints Obama as an elitist and says his opposition to the gas tax holiday shows he's out of touch with working class voters. At a John Deere store in North Carolina she was selling her plan.

CLINTON: I think I have the right policy. I want the congress to have to stand up and vote, are they for the oil companies or are they for you?

LOTHIAN: And despite the better than expected jobs report, both Clinton and Obama said the numbers are not encouraging.

CLINTON: We lost 20,000 jobs last month and people are saying, that's better than we thought. Well I don't accept that at all. We're not supposed to be losing jobs in America. We're supposed to be creating jobs in America.

OBAMA: This news is troubling, but it's not surprising because in recent months, we've seen the problems in our economy grow worse and worse.

(END OF VIDEOTAPE)

VELSHI: Dan Lothian is live with the CNN election express with some brand new polls. Dan, this gas price issue continues sort of to lead the polls in terms of what Americans are thinking. What have you got for us?

LOTHIAN: It really does. And one reason you're seeing the candidates talking so much about gas prices, the latest numbers from the CNN Opinion Research poll. And it focused on several different questions but one in particular where we'll begin is whether or not the rising gas prices have caused any financial hardships.

For most of those who were polled, 1,000 or so who took part in the survey said, yes, 19 percent said severe hardship, 41 percent said moderate hardship. 39 percent said not a hardship at all. Then they were also asked whether or not they thought that over this year that gas would actually hit $5 a gallon. We know that's been the concern we were talking about $4, it's really hit that now. And whether or not they think it's going to hit $5 a gallon, the majority thinking yes that will actually happen. 44 percent saying it's very likely that it will hit $5 a gallon, 34 percent saying somewhat likely, 22 percent saying not likely at all. And then finally, this issue of whether or not oil companies are making way too much money, Senator Clinton was talking about that just a few minutes ago, it's been central to the campaign of the democrats have been talking about this, 83 percent said the oil companies are making too much money, only 13 percent said that profits were reasonable. Ali?

VELSHI: All right Dan, thanks very much. Those poll numbers reflecting the Americans are very, very concerned about gas prices. Dan Lothian at the election express.

Now coming up next, we have not forgotten about Senator John McCain. What the republican presidential candidate says he's going to do to fix the economy. Plus, we're going to fact check all three candidates and their solutions. We're standing by for Senator Obama who is at an event in Durham, North Carolina. When the candidates speak, you'll hear them live on this special edition of ISSUE #1.

(COMMERCIAL BREAK)

ALI VELSHI, CNN ANCHOR: Welcome back to ISSUE NUMBER ONE.

A barrel of oil crossed $120 barrel just in the last hour or so over concerns about supply. And there's little relief at the pump. The price of a gallon of gas stands at $3.61 a gallon according to AAA. That's about a penny lower than the all-time record. President Bush, this morning, said he's troubled by high gas prices and he'll take a look at proposals to lower them, but he warns that there's no quick fix. GERRI WILLIS, CNN ANCHOR: There's lots more to talk about, like a fact check of the candidates. But first, we want to get you caught up on a big developing story in the CNN "Newsroom."

Don Lemon, take it away.

DON LEMON, CNN CORRESPONDENT: Yes, this one seems to be getting worser, Gerri.

The death toll is growing at an astonishing pace. Just moments ago, the government of Myanmar said more than 10,000 people were killed in the monster cyclone that hit south Asia. The unit (ph) says the situation is desperate.

Hundreds of thousands need shelter and clean drinking water. Many people are running low on food. Of course, the power is out and phone lines are down as well.

People have been on the streets using axes and machetes to clear thousands of downed trees. Our correspondent on the ground calls it, "a scene of utter devastation." Coming up in the "Newsroom" at the top of the hour, we'll have extensive coverage from Myanmar.

Back here at home now. We want to talk about the tough task of cleaning up in Arkansas. Seven people were killed, hundreds of homes damaged in Friday's violent storms. The National Weather Services says at least 10 tornadoes ripped all across Arkansas. One had winds of 165 miles an hour. Meteorologists say one tornado may have plowed a 45-mile long path. Today, Arkansas's governor is touring three communities devastated by those storms.

An injured horse is euthanized after the Kentucky Derby. Critics say the death of Eight Belles is symptomatic of a bigger problem with American horse racing. Join me at the top of the hour for the CNN "Newsroom." We've got that story and much, much more.

I'm Don Lemon. Now back to Ali Velshi.

Ali, I hear your new nickname is HPOD for hairless prophet of doom? You want to talk about that?

VELSHI: Jon Stewart on "The Daily Show" decided that there's just too much bad business news. But as you know, Don, we give you all of the business news. Some of it's bad, some of it's good. So I'm going to try and shed that nickname.

LEMON: Some of it has it be given by an HPOD, a hairless prophet of doom.

VELSHI: That HPOD, you've got to download it.

Don, good to talk to you. Thank you.

LEMON: Good to talk to you. See you later, Ali.

VELSHI: And as Don brings up, so much of the news these days, economically, isn't great. And so much of the focus lies on the economy. That's what the two Democratic candidates for president seem to be concentrating on. But we want to make sure that we also talk about Senator John McCain, the presumptive nominee for the Republican Party. The economy hasn't always been McCain's focus, but it is issue number one to American voters and he sure is talking about it now. CNN's Dana Bash has more.

(BEGIN VIDEOTAPE)

DANA BASH, CNN CORRESPONDENT, (voice over): At a Denver town hall, first things first.

SEN. JOHN MCCAIN, (R) PRESIDENTIAL CANDIDATE: And Americans are going through tough times now, my friends, and I don't think we can sugarcoat it.

BASH: News of April's 20,000 lost jobs was better than economists predicted and not as bad as the 81,000 lost in March. But John McCain knows that as a Republican running in this stark, economic climate, to look for a silver lining would risk looking out of touch.

MCCAIN: Americans are hurting today. The latest jobs report, although not maybe as bad as some had predicted, is still bad. Unemployment continues up. Americans are suddenly and recently losing their jobs.

BASH: That kind of talk is aimed at McCain's political reality. Seven in 10 Americans now say things in this country, under a Republican president, are going badly. But it's also targeted at the sector of voters McCain is now homing in on, blue collar whites, what Republican pollsters call this year's soccer moms.

WHITFIELD AYERS, REPUBLICAN POLLSTER: We've been doing a lot of focus groups with blue collar whites in swing states. They're open to voting for Hillary Clinton, but there's no way on God's green earth they're going to vote for Barack Obama. They will vote for John McCain instead. So reaching out to those people we used to call Reagan Democrats is a very smart strategy for John McCain.

MCCAIN: It's on the poorest Americans. They drive the furthest and they drive the older automobiles which are the highest gas guzzlers.

BASH: All week long, as Barack Obama voiced his opposition to a gas tax holiday, McCain tried to use his support as a way to connect.

MCCAIN: And I want to give the American consumer a little bit of relief just for the summer. Maybe they'll be able to buy an additional textbook for their children when they go back to school this fall.

BASH: McCain insists he knows temporarily removing the gas tax wouldn't do anything to solve the bigger issues around gas prices and dependence on foreign oil, as Obama regularly points out. But McCain advises hope by telling voters he understands that even a few dollars would go a long way for struggling families, he can at least establish himself as someone who's on their side. It's a tough task for any Republican, especially these days.

Dana Bash, CNN, Washington.

(END VIDEOTAPE)

WILLIS: Well, as we get deeper into the presidential campaign season, you know, it allows us, as journalists, to dig deeper into the candidates' positions on various issues. And with this being ISSUE NUMBER ONE, we thought we might do a fact check on where Senators Clinton, Obama and McCain stand on the various issues pertaining to your economy. Bill Adair is the editor of politifact.com and he's joining us now from Washington.

Bill, welcome. Great to see you.

BILL ADAIR, EDITOR, POLITIFACT.COM: Thanks for having me.

WILLIS: All right. So we're going to play the truth-o-meter game. And to do that, before I ask the first question, I'm going to ask our director, Will Nunez (ph), just to dim the lights a little bit so we get a little drama going here because these questions are great.

OK. First of all, Hillary Clinton says she advocates a freeze on foreclosures. Barack Obama has said no. True or false?

ADAIR: We gave that one a true on the truth-o-meter. This is a rare case where she and Obama disagree on policy. Indeed, Senator Clinton supports a freeze on foreclosures for people who have subprime mortgages. Obama does not. His concern is that if the -- you were to give out something like that and freeze it, that mortgage companies would penalize other new home buyers and it would end up doing more harm than good.

WILLIS: Well, a big problem everybody's trying to solve, that's for sure.

OK. Next question. Dim the lights. The price of a gas tax holiday. McCain says this would be about the same as a bridge to nowhere or another pork barrel project. Truer to false?

ADAIR: Well, this one was so false we gave it a "pants on fire," which is actually our lowest rating.

WILLIS: A "pants on fire" rating?

ADAIR: A "pants on fire" on our truth-o-meter. That's for something that's ridiculously false. Senator McCain's math is way off here. The numbers are just way different. The cost of a gas tax holiday for the summer would be about $9 billion. The cost of the famous bridge to nowhere, the bridge in Alaska, is about $200 million. And the cost of an average pork barrel project that Senator McCain's talking about is only about $1.3 million. So you're talking about a real order of magnitude of difference, about 45 bridges, just to pay for a summer's worth of gas tax, or about 7,000 pork barrel projects. So his math is way off.

WILLIS: All right. Just a little bit off there, huh? That was sort of embarrassing. Not good math there.

OK. Another question, if you want to dim the lights. Well, McCain says Obama flip-flopped on the gas tax holiday. Everybody's been talking about this. Should we have a holiday from gas taxes for the summer driving season? What's true, what's false?

ADAIR: Well, we gave this one a barely true on our truth-o-meter on politifact.com. And the reason is that the video -- the video's actually from the Republican National Committee, it's correct that Senator Obama did support a gas tax holiday in 2000, when he was the state senator. But at the time, he and other state senators raised concerns that the money might not get to consumers. Six months later, when it came up for an extension, Senator Obama voted against it for the same reason that he's been saying that he opposes the McCain and Clinton proposal now. He doesn't feel that the money was getting the consumers. So we decided that he had actually been pretty consistent on his position. So even though he had voted for it originally, he was consistent. So we gave him a barely true on our truth-o-meter.

WILLIS: All right. OK. Well, great stuff. This is Bill Adair, you're talking to here. And you can see on his web site some more of this true or false. Politifact.com is his web site.

Thanks so much, Bill, we enjoyed your segment.

ADAIR: Thanks, Gerri.

VELSHI: I love politifact.com. I like getting answers to what the differences are between these candidates and what they say and whether it really holds up.

Coming up next, a dispute over rising gas prices and just who is responsible for them. You're watching a special election edition of ISSUE NUMBER ONE right here on CNN.

(COMMERCIAL BREAK)

WILLIS: Both Democratic candidates, Senator Barack Obama and Senator Hillary Clinton, appeared on CNN's "American Morning" earlier today to talk about the issues leading into tomorrow's key primary elections in Indiana and North Carolina. A major issue was how to help Americans who are struggling with rising energy costs. So let's listen in to what Senator Obama had to say to "American Morning" anchor John Roberts.

(BEGIN VIDEO CLIP)

SEN. BARACK OBAMA, (D) PRESIDENTIAL CANDIDATE: I want to provide a middle class tax cut of up to $1,000 per family per year, a much bigger amount of relief that can cover not only rising gas prices, but also rising food prices and, at the same time, I want to invest in alternative energy and raising fuel efficiency standards on cars, something that I've been calling for for years and that Senator Clinton has opposed in the past.

(END VIDEO CLIP) WILLIS: All right. So that's one view. Senator Hillary Clinton is also speaking out on high oil prices. Clinton says she wants to look into energy trading regulations.

(BEGIN VIDEO CLIP)

SEN. HILLARY CLINTON, (D) PRESIDENTIAL CANDIDATE: The energy traders brought us higher electricity prices during the Enron scandal so that people along the West Coast were paying not what the market required, but what they were manipulated into having to pay. At the end of 2000, a huge bill was passed with thousands of pages in it. And buried in it, in the dead of night, was what became known as the Enron loophole, lifting regulation off of energy traders.

I want to regulate energy traders. The best way to do that is to launch this investigation to demonstrate what people even in the oil company are saying, that the price is being manipulated, people are paying more than they should have to.

(END VIDEO CLIP)

VELSHI: All right. And the price of a barrel of oil topped $120 a barrel this morning. A gallon of gasoline, $3.61. Not a record. Just a penny below a record. So we're joined by CNN business correspondent Susan Lisovicz, CNN senior correspondent Allan Chernoff.

We've -- all three of us -- covered Enron from start to finish. So when that name comes up, it's very shocking. It's shocking to Americans, too, when they think of what Enron did to America and Hillary Clinton bringing it in. What is this Enron loophole she's talking about?

ALLAN CHERNOFF, CNN CORRESPONDENT: The Enron loophole, it's something that Enron pushed for and got Congress to approve. It basically allows electronic traders to engage in a tremendous amount of energy trading with zero regulation. And what's happening right now is that so much of the energy trading, crude oil, gasoline, et cetera, is happening on an exchange away from the New York Mercantile Exchange. The Commodity Futures Trading Commission has no say over it.

VELSHI: Go ahead, Susan.

SUSAN LISOVICZ, CNN CORRESPONDENT: But, you know, I would say that, you know, Enron has been accused of many, many things, including diverting assets and fraudulent transactions (INAUDIBLE) in business. The fact is that oil is a hot commodity, just like corn, just like soybeans. And I would say the manipulation that's going on right now is with the producers.

When you have Venezuela seizing private assets or OPEC saying, we're going to give you this amount of oil, you do have a frenzy of activity going into it. You have a collusion of like thinking, if you will. Everybody thinks oil is going to go high.

CHERNOFF: Susan makes a good point. I think that closing this so-called Enron loophole would not necessarily bring down oil prices at all. What's going on now is that there is a tremendous amount of money going into all commodities, especially crude oil and gasoline. In fact, if you look at the economic fundamentals, there is no way in the world that gasoline and oil should be so high.

Created some graphics here. Let's have a brief look at that and you'll see that right now we've got plenty of gasoline. More than we had a year ago. But look at what's happening right now to the price of gasoline. We are, as you said, just shy of an all-time record, $3.61. Way higher, 20 percent higher, than a year ago, yet we have more gasoline in our inventory.

VELSHI: Yes. So that goes to tell you it's not just supply and demand.

CHERNOFF: That's an economic disconnect. Didn't make any economic sense at all.

LISOVICZ: On the other hand, I don't think anybody is saying -- anyone is saying that it's going to comes down to reflect reality. There's going to come -- a little air is going to come out of the bubble, but don't think that . . .

VELSHI: Don't think we're going back to . . .

LISOVICZ: Cheap energy is going to be with us for the foreseeable future

VELSHI: All right. We've got our team of experts on this. They're going to dig more into what exactly, who's responsible, for the price of a gallon of gas and a barrel of oil.

CNN, of course, does have the best political team in television. So this is the place that you want to be for the absolute best coverage of the Indiana and North Carolina primary results. Wolf Blitzer, Campbell Brown, Lou Dobbs and the rest of the team. We'll have it all for you starting tomorrow at 7:00 p.m. Eastern.

Gerri.

WILLIS: Up next, we've assembled the CNN Money team to take on issue number one, the economy, and what it means for this election. This special edition of ISSUE NUMBER ONE rolls on next.

(COMMERCIAL BREAK)

VELSHI: Welcome back to ISSUE NUMBER ONE.

This is usually the time of the program where we answer your e- mails. Today we want to focus on the candidates and their plans for the economy. Let's get to the CNN Money team. Hillary Kramer is the author of "Ahead of the Curve." And with us again, CNN's Susan Lisovicz and Allan Chernoff.

Hillary, let's start with you. We just spoke to Bill Adair of Politifact. We were talking about the candidate's plans to deal with the foreclosure crisis. Do you get a sense that any of the plans are really going to hit this problem head on and solve the problem?

HILARY KRAMER, AOL MONEY COACH: Well, on an immediate level, yes. Long term, no, it has to work through the system. But certainly Hillary Clinton, with a $30 billion emergency relief package for those that are really hit with foreclosure crisis, that really makes a big difference, as well using a 90-day moratorium. So I think that could do it. But long term, again, we've got to work through it.

VELSHI: Susan, you work on Wall Street every day. We all talk about it. You're t here every day. What's happening with these candidates in terms of the reaction you're getting from people who work in the financial sector? Do they see something in any of them that looks like they think will work?

LISOVICZ: Well, I mean, you know, everybody says they want change, right? I mean you see that in poll after poll. So I think that there's a lot of money going to all three candidates, let's face it.

But I think what Wall Street doesn't like is that both Hillary Clinton and Barack Obama are going to probably change the tax rate on dividends and capital gains. That is something that doesn't go over well. And they're also going to probably raise the taxes on the wealthiest Americans and that's who's investing the most.

KRAMER: Right. And, Ali, the issue on Wall Street that I'm finding is that McCain wants to cut the corporate tax rate to stimulate the economy, so that's making McCain a very appealing figure on the street.

VELSHI: Allan, what do you think about that?

CHERNOFF: Certainly, on the tax side, McCain is, without a doubt, the candidate of wealthy Americans, the candidate of Wall Street. I mean, McCain hasn't always been an economist. I mean, I don't think anybody would say he . . .

KRAMER: He's supposed to admit it.

CHERNOFF: Nobody would say he is an economist. But over the past few months, we've certainly seen him adopt many of those traditional, Republican platforms. He's going for that end. And Clinton and Obama, clearly, they have the other side of this arena. They've said that we will cut taxes for middle Americans, for middle income Americans.

VELSHI: Well, Susan, one of the things we're seeing, obviously, with one of these primaries in Indiana is a lot of attention to farming and job losses. These are places where jobs have disappeared, particularly industrial and manufacturing jobs. Any of the candidates resonating particularly with voters where those jobs have gone? LISOVICZ: Well, I think that both Barack Obama and Hillary Clinton are talking a lot about new jobs. Like, for instance, with an intelligence economy. And one of them would have to be alternative energy. Both of them are talking about putting a lot of stimulus there.

KRAMER: Right.

LISOVICZ: And, you know, in fact, I just got back from the cornhusker state, Nebraska.

VELSHI: Right, from Nebraska, that's right. And we should say, you were talking to Warren Buffett.

LISOVICZ: There was a realtor who pinned me against the wall and said there is no real estate recession in Nebraska! Well, let's face it, I mean, they are somewhat insulated because of ethanol. But they're also seeing residents are paying higher food prices.

VELSHI: Right, they still pay higher prices for what they do. That's the biggest issue that we've got here. Gas prices, to our viewers -- the economy is number one and gas prices are the number one concern.

KRAMER: Right. That's absolutely right. Now that's why Barack Obama, with $150 billion package, that he wants to jump start an entire industry, alternative energy and clean technology, could be very valuable, especially matching that up with legislation to force the use of alternative energy.

VELSHI: Hilary, thank you. Allan, thank you. Susan, we appreciate you being with us to give us a bit of a position on where the candidates stand.

Gerri.

WILLIS: We're standing by for Senator Barack Obama, scheduled to speak in the research triangle in Durham, North Carolina. We'll bring it to you as soon as it starts.

You're watching ISSUE NUMBER ONE.

(COMMERCIAL BREAK)

WILLIS: Senator Barack Obama about to speak in the research triangle in Durham, North Carolina, to a group of workers.

VELSHI: And, you know, the topic today, as we head into the North Carolina and Indiana primaries, has been issue number one, the economy. Both Senator Obama and Senator Clinton are trying to appeal to workers. They are speaking extensively about gas prices. Senator Clinton was talking about how hard these gas prices are on working Americans. So those are both big deals that we're going to hear about from the candidates. We'll be on it all day.

WILLIS: All right. Time now to get you up to speed on other stories making headlines. CNN NEWSROOM with Don Lemon and Brianna Keilar starts right now.