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Obama, McCain Fight Over Threat From Iran; Clinton: There's No Nominee Yet; McCain Purges Campaign of Another Lobbyist

Aired May 19, 2008 - 16:00   ET

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


WOLF BLITZER, CNN ANCHOR: Happening now, Barack Obama and John McCain fight over the threat from Iran. They're going out of their way to accuse each other of having dangerous foreign policy views. It's a testy preview of what we may be seeing in the coming weeks and months.
Hillary Clinton reminds Barack Obama he's not the Democratic nominee, at least not yet. She's arguing her case on another primary eve.

I'll speak live with her campaign chairman, Terry McAuliffe, and I'll ask if Clinton's rivals are essentially forgetting about her.

Obama tells Republican critics of his wife to "lay off." Are Michelle Obama and Cindy McCain likely to be prime political targets in the weeks and months ahead?

I'm Wolf Blitzer. You're in THE SITUATION ROOM.

It's the middle of May, but you might think it was mid-September the way Barack Obama and John McCain are going at it right now. McCain today calling Obama's view of the global threat from Iran, and I'm quoting now, "reckless." Obama today accusing McCain of wanting to continue President Bush's "failed cowboy diplomacy."

Let's begin our coverage this our with our Suzanne Malveaux. She's in Kentucky, where there's a Democratic primary tomorrow.

Obama's not wasting any time -- not wasting any time going after McCain right now. You wouldn't know necessarily there was a primary where you are in Kentucky tomorrow.

SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Absolutely right, Wolf.

Obama is making two stops in Montana. That is the site of one of the last primaries, the last contests. The message here is clear from the Obama camp. They're trying to paint a picture saying, look, we see the end of the tunnel, we are engaged in a new race.

(BEGIN VIDEOTAPE)

MALVEAUX (voice-over): The fight is on.

SEN. BARACK OBAMA (D-IL), PRESIDENTIAL CANDIDATE: So John McCain, he said, oh, Obama doesn't understand the threat of Iran. I understand the threat of Iran.

MALVEAUX: Barack Obama versus John McCain over who's better equipped to take on Iran.

SEN. JOHN MCCAIN (R-AZ), PRESIDENTIAL CANDIDATE: Senator Obama has declared and repeatedly reaffirmed his intention to meet the president of Iran without any preconditions, likening it to meetings between former American presidents and the leaders of the Soviet Union. Such a statement portrays the depth of Senator Obama's inexperience and reckless judgment.

B. OBAMA: When the world was on the brink of nuclear holocaust, Kennedy talked to Khrushchev and he got those missiles out of Cuba. Why shouldn't we have the same courage and the confidence to talk to our enemies? That's what strong countries do, that's what strong presidents do, that's what I'll do when I'm president of the United States of America.

(APPLAUSE)

MALVEAUX: The fierce debate over national security between the two reflects the growing sense from both camps. This race is now between them. Obama now only mentions his Democratic rival Hillary Clinton in passing.

B. OBAMA: Whatever differences exist between myself and Senator Clinton, we are unified in the idea that whatever else happens in November, the name George W. Bush isn't going to be on the ballot.

(APPLAUSE)

MALVEAUX: Perhaps too early for a victory lap, but Obama is certainly acting like a winner.

B. OBAMA: Let's face it, nobody thought a 46-year-old black guy named Barack Obama was going to be the Democratic nominee.

MALVEAUX: Wrapping up campaigning in primary states Kentucky and Oregon, Obama has moved on. He's in Montana today, which along with South Dakota, hold the final primaries two weeks away. While Obama says he won't declare victory Tuesday night, his campaign has already put out a statement predicting Obama will reach a so-called "major milestone" by securing the majority of delegates elected by the voters.

(END VIDEOTAPE)

MALVEAUX: But, Wolf, really even if he gets the majority of the pledged delegates, it is not enough to give him the nomination to put him over the top. For that he needs more superdelegates, as the Clinton campaign has been reminding us.

Obama is going to be having his victory rally in Iowa. That's certainly giving a reminder to the voters there that this was the place where he became the Democratic front-runner to beat -- Wolf.

BLITZER: It seems like only yesterday. All right. Thanks very much, Suzanne.

Suzanne Malveaux joining us from Kentucky.

In another warm-up for the general election, Barack Obama is telling Republicans to "lay off" his wife." The Democrat facing new questions about an online video put out by Tennessee's GOP. That's the one that criticizes Michelle Obama for saying she's proud of her country now for the first time.

With Mrs. Obama at his side, the senator delivered a firm message to his wife's critics in an interview televised earlier today.

(BEGIN VIDEO CLIP)

B. OBAMA: The GOP, should I be the nominee, I think can say whatever they want to say about me, my track record. If they think that they're going to try to make Michelle an issue in this campaign, they should be careful, because that I find unacceptable.

The notion that you start attacking my wife or my family -- you know, Michelle is the most honest, the best person I know. She is one of the most caring people I know. She loves this country. And for them to try to distort or to play snippets of her remarks in ways that are unflattering to her I think is just low class, and I think most of the American people would think that as well.

Whoever is in charge of the Tennessee GOP needs to think long and hard about the kind of campaign that they want to run. And I think that's true for everybody, Democrat or Republican.

MICHELLE OBAMA, WIFE OF BARACK OBAMA We're trusting that the American voters are ready to talk about the issues and not talking about the things that have nothing to do with making people's lives better.

B. OBAMA: But I also think these folks should lay off my wife. All right? Just in case they're watching.

(END VIDEO CLIP)

BLITZER: We're going to have a full report on Obama' defense of his wife, Michelle, and whether defending a spouse is always a political plus. That's coming up later in THE SITUATION ROOM.

Now to Hillary Clinton, fighting on another primary eve like there's no tomorrow. She's bracing for a big loss in Oregon and counting on a big win in Kentucky. And she's reminding Barack Obama that he can act like the nominee, but he doesn't have it locked up, at least not yet.

Our senior political correspondent, Candy Crowley, is joining us now from Kentucky with more on this part of the story -- Candy.

CANDY CROWLEY, CNN SR. POLITICAL CORRESPONDENT: You know, Wolf, there are a lot of ways to look at this primary season. Barack Obama, of course, is adding up those pledged delegates as he nears the number, at least, that he needs in order to secure the nomination. But in the Clinton campaign, there are other mathematics that they prefer to talk about.

(BEGIN VIDEOTAPE)

CROWLEY (voice-over): The last day of any campaign is about getting out the vote.

SEN. HILLARY RODHAM CLINTON (D-NY), PRESIDENTIAL CANDIDATE: Let me ask you, are you going to vote tomorrow?

CROWLEY: Hillary Clinton will win here in Kentucky. What she wants to do is run up the score.

CLINTON: Well, if Kentucky votes big tomorrow, we are going to keep going and we're going to keep fighting and we're going to keep making our case.

CROWLEY: Her case, and it is made now to superdelegates, is about geography and numbers.

CLINTON: Anybody who's really analyzing this and saying, OK, we did not go through this long campaign to lose in the fall, we cannot afford to have four more years of a Republican president...

CROWLEY: She talks electoral votes, suggesting he can't win in November because she wins in states Democrats need, and his primary victories are in places Republicans will win.

CLINTON: My opponent has 217 electoral votes including places like Alaska and Idaho and Utah and Kansas and Nebraska. And many of his votes and his delegates come from caucus states which have a relatively low turnout.

CROWLEY: And she talks popular vote.

CLINTON: More people have voted for me than have voted for my opponent. More people...

(APPLAUSE)

CLINTON: ... have voted for me than for anybody ever running for president before.

CROWLEY: She's ahead in the popular vote only if you count results from party rule breakers Florida, where no one campaigned, and Michigan, where Obama wasn't on the ballot, and if you discount all the caucuses, the majority of which were won by Obama.

What keeps her going stop after stop, state after state? Aides say it's the energy she gets from the faithful and the bedrock belief she's the better candidate and would be a better president.

(END VIDEOTAPE)

CROWLEY: What they would like here, of course, is an eye-popping win in Kentucky, kind of like the one they got in West Virginia, a 40- point victory. However, they also know that the mathematics only go so far.

Wolf, today the senior member, the longest serving member of the U.S. Senate, endorsed Barack Obama as a shining young statesman. And that senator was Robert Byrd from West Virginia -- Wolf.

BLITZER: Despite Hillary Clinton's big win in West Virginia only the other day.

All right, Candy. Thanks very much.

Let's go back to Jack Cafferty. He's got "The Cafferty File."

Hi, Jack.

JACK CAFFERTY, CNN ANCHOR: Barack Obama was part of something pretty amazing yesterday, something that I've never seen before -- an event that looked more look a Rolling Stones concert than a political rally. He drew a largest crowd of his campaign so far in Oregon. It was estimated at 72,000 people.

These pictures look like Woodstock -- cheering supporters as far as the eye can see. "Wow!" is the way Obama summed it up when he got on stage, checked out the crowd. Tens of thousands crammed into this Riverside Park, another 15,000 people were left outside. There wasn't enough room.

Obama has achieved a lot of firsts in this campaign -- the first African-American with a serious shot at his party's nomination, the first candidate in a long while to mobilize the nation's youth, get them to the polls. And now crowds that could fill a football stadium.

Obama says he's planning to go to Iowa to await the results of tomorrow's primaries because, "It would be a terrific way to bring things full circle." Iowa, of course, is where he scored his first big win over Hillary Clinton.

Obama says if things go as we hope after Oregon and Kentucky vote, he will have the majority of pledged delegates which would be, in his words, a pretty significant mark. Obama says he won't be declaring victory at that point, but it does bring him a step closer to being the Democrats' nominee for president. In the meantime, his campaign has already stepped up attacks on John McCain, primarily tying him to President Bush, and has sent teams into the battleground states hoping to sign up millions of Democrats in the next six months.

Here's the question: What message does it send to the Republicans when 72,000 people show up for a Barack Obama campaign rally?

Go to CNN.com/caffertyfile. You can post a comment on my blog.

BLITZER: All right, Jack. Thanks very much.

John McCain is going to new lengths today to control damage to his image as a reformer. Will injecting other high-profile aides solve his problem?

Plus, the political parties are digging for dirt on the White House contenders, and some of it's winding up online.

And Clinton campaign chairman Terry McAuliffe is standing by live. I'll ask him if the senator is contradicting her own battle cry that every vote should be counted.

Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: John McCain is on Barack Obama's home turf. That would be in Chicago today. And as we've reported, he's sharpening his charge that Obama isn't seasoned enough to be commander in chief. But there may be more to his criticism than meets the eye.

Let's bring in Dana Bash. She's here in THE SITUATION ROOM watching this story.

What do you read into all of this?

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT: Well, look, the fact that John McCain hit Barack Obama has naive again on Iran, that was in large part because they think that this is by far one of their most winning issues on this campaign that they think they'll have against Barack Obama. But, you know, it's also about moving away way from what we saw in the morning headlines, and that is self-imposed policies against lobbyists and special interests inside the McCain campaign. Because of that, five McCain aides have now left the campaign.

(BEGIN VIDEOTAPE)

BASH (voice-over): On the trail, talk of reform is fundamental to John McCain's outreach to Independents as he tries to establish himself as a creature of Washington intent on changing it.

MCCAIN: There's many programs that I'm against that favor special interests.

BASH: Off the trail, McCain is purging his campaign of lobbyists, an aggressive effort to deflect charges of hypocrisy. The latest to go is the most high profile, Tom Loeffler. McCain's national finance chairman, a lobbyist paid $15 million by Saudi Arabia, according to "Newsweek." Loeffler left after McCain announced new strict policies last week prohibiting any staffer from being a registered lobbyist or a foreign agent.

New rules rushed into place after two McCain aides who lobbied on behalf of the military regime in Myanmar had to resign.

MCCAIN: We found out that this -- these two individuals had represented that country, and so they left. And we will vet everyone very seriously and make sure that it's not a repetition.

BASH: Barack Obama pounced.

B. OBAMA: John McCain keeps on having problems with his top advisers being lobbyists in some cases for foreign governments or other big interests that are doing business in Washington. That, I don't think, represents the kind of change that the American people are looking for.

BASH: McCain has long been criticized for having lobbyists play key roles in his campaign. Top adviser Charlie Black was a senior partner in his lobbying firm until March, when he retired with a severance package.

McCain's campaign manager, Rick Davis, gave up his status as a registered lobbyist five years ago, took a leave from his lobbying firm two years ago. But the firm can still use his name to recruit business since it's still on the letterhead.

(END VIDEOTAPE)

BASH: McCain aides say they should be applauded for new strict policies prohibiting staffers from lobbying and working with outside political groups. But privately, some advisers concede these are self-inflicted wounds.

The reason, Wolf, is that this is something some people think could have been done months ago because of the fact that they knew this would be an issue since John McCain has long crusaded against special interests and has made that a centerpiece of his campaign.

BLITZER: We remember McCain/Feingold very, very well.

Dana, thank you.

And as you might expect, the nation's capital is jam-packed with lobbyists, many of them headquartered on Washington's famous K Street. As of last fall -- get this -- 41,386 lobbyists were registered with the Senate Public Records Office. They outnumbered members of Congress big time.

There are 77 registered lobbyists for every one of the 535 members of the U.S. House and Senate, and that doesn't include the foreign agents, the registered foreign agents registered with the Justice Department. A lot more of those on K Street and elsewhere here in Washington as well.

The Democratic Party has been gathering opposition research on John McCain for quite some time. Now that information is being made public with the launch of a new Web site.

Let's go to our Internet reporter, Abbi Tatton.

Abbi, what's on the site?

ABBI TATTON, CNN INTERNET REPORTER: Wolf, this is an online encyclopedia focused on Senator John McCain, and written and edited by the Democratic National Committee. McCainpedia just launched. This takes the opposition research from the Democrats and puts it online organized into categories -- Iraq, security. And there's online video as well from the DNC Web ads on YouTube, and also the archive of campaign tracking video that's been online since last fall.

Now, all accessible in one page. It looks similar to the widely popular Wikipedia. They've modeled it after that, but there's one major difference. It's the Democratic National Committee that is editing this site and controls the material.

This follows the Republican National Committee's increased online focus on Senator Barack Obama. This Web site Can We Ask? Invites people to submit questions by YouTube to the senator. You can see it pushed on the RNC Web site with other links all targeting Senator Obama. Senator Hillary Clinton no longer found on that front page -- Wolf.

BLITZER: Abbi Tatton, thank you.

Well wishes are pouring in to Senator Edward Kennedy, including from President Bush. He had some special advice for Kennedy's wife Vicki. We're going to tell you what it is.

And both Hillary Clinton and Barack Obama say they're ahead in the Democratic nomination race. But who's right? Bill Schneider has some fun with all the numbers.

Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

(NEWSBREAK)

BLITZER: Hillary Clinton insists the race for the Democratic presidential nomination is nowhere near over. But is she fighting a losing battle by counting on delegates in Michigan and Florida and the superdelegates? I'll speak live with her campaign chairman, Terry McAuliffe. He's standing by here in THE SITUATION ROOM.

Plus, your next vice president, would it be Mike Huckabee? Could it be John Edwards? Lots of speculation heating up about potential running mates.

We're going to look at who might be in, who could be out in our "Strategy Session." That's coming up in a little bit.

Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: To our viewers, you're in THE SITUATION ROOM.

Happening now, they've sparred bitterly on the campaign trail, but are Hillary Clinton and Barack Obama really talking about joining forces when it comes to fund-raising?

We're checking that out. Comic relief. John McCain shows off his funny side and takes aim at his own "very, very, very old" age. That's a quote from him. Is this a new humor strategy at work?

And fury in Iraq. A U.S. soldier used a Koran for target practice. Now many Iraqis want a lot more than just a U.S. government apology.

Our Michael Ware is in Baghdad. He'll tell us what the U.S. military is now doing.

I'm Wolf Blitzer. You're in THE SITUATION ROOM.

Barack Obama insists he has the lead in delegates. Hillary Clinton maintains she's ahead in the popular vote. Are they both right, or is this a case of creative math at work?

Let's go to our senior political analyst, Bill Schneider, who's looking at this story for us.

All right. Here's a simple question, Bill. Who's ahead in the Democratic race?

WILLIAM SCHNEIDER, CNN SR. POLITICAL ANALYST: Wolf, simple question. Complicated answer. Because each side has its own way of counting.

(BEGIN VIDEOTAPE)

SCHNEIDER (voice-over): Barack Obama makes this claim...

B. OBAMA: If Kentucky and Oregon go as we hope, then we think we will have a majority of pledged delegates at that point. And that's a pretty significant mark.

SCHNEIDER: Obama is counting pledged delegates, the ones selected by voters in primaries and caucuses. A majority of pledged delegates would be 1,627. How many pledged delegates does Obama have right now? One thousand, six hundred and twelve.

A hundred and three pledged delegates are at stake in Oregon and Kentucky on Tuesday. Obama needs only 15 more to back up his claim. That is likely.

Actually, you need 2,026 total delegates, pledged and superdelegates, to win the Democratic nomination. Obama now has 1,904. To go over the top, Obama would need to take nearly all the delegates on Tuesday. That is unlikely.

The Clinton campaign raises the bar to 2,210 delegates for a majority, including delegates from Florida and Michigan. Clinton is making this argument...

CLINTON: And right now I am leading in the popular vote. More Americans have voted for me. SCHNEIDER: Obama leads in the total primary and caucus vote. Suppose we include Florida and Michigan voters and don't give Obama a single vote in Michigan since he took his name off the Michigan ballot. Obama still leads narrowly in total votes.

Some Clinton supporters argue that caucus voters should not be included. Turnout is much lower in caucus states, there's no secret ballot, and some caucus states don't even report vote totals.

What happens if you exclude caucus voters, include Florida and Michigan voters, and don't give Obama any votes in Michigan? Then, and only then, does Clinton move into the lead in popular votes.

(END VIDEOTAPE)

SCHNEIDER: Clinton says the superdelegates should pay attention to the popular vote, counted the way she prefers. Obama says the superdelegates should pay attention to the pledged delegates since they were chosen by the voters according to the rules.

Now, the party rules say, all delegates should vote their conscience, as long as they fairly reflect what the voters say in the primaries and caucuses -- Wolf.

BLITZER: Getting dizzy from all that math.

All right, Bill, thanks very much. Good report.

No matter how you add it all up, Hillary Clinton says she's not dropping out of the race for what she calls the toughest job in the world.

Senator Clinton's campaign chairman, Terry McAuliffe, is here in The Situation Room to discuss all of this.

Terry, thanks for coming in.

(LAUGHTER)

TERRY MCAULIFFE, CLINTON CAMPAIGN CHAIRMAN: You bet, Wolf.

BLITZER: Were you getting dizzy, too, listening?

MCAULIFFE: And the race goes on.

(LAUGHTER)

BLITZER: The race goes on.

(LAUGHTER)

BLITZER: Let's talk a little bit about pledged delegates.

MCAULIFFE: Sure.

BLITZER: These are the delegates that are actually elected. Presumably, at some point tomorrow, after Kentucky and Oregon, Obama will be able to say he has a majority of the elected delegates.

Is it realistic to assume that the superdelegates would overturn what the majority of the pledged delegates have determined?

MCAULIFFE: Well, first of all, when we finish this process, over 4,000 delegates will have been chosen. It's going to be very close. I have said for a long time it will be within 100 delegates, out of 4,000 chosen.

BLITZER: You're including the superdelegates and the pledged delegates?

MCAULIFFE: Yes, you bet.

BLITZER: But a lot of people say the pledged delegates, the ones that were elected, that's really decisive, because you can't -- you can't, in effect, steal an election by the superdelegates, who are the party insiders, the elected officials.

MCAULIFFE: Yes. Well, let's not make it too complicated for your viewers, but of the 35 million votes cast, 34 million, Wolf, have come in through primaries with a lot more voters. Only one million have come in through caucuses.

Think of that, one million out of the 35 million.

BLITZER: What, you don't want to count those people?

MCAULIFFE: I'm saying, we count them, but don't forget, a lot more people voted in the primaries than the caucuses. That's where his entire lead has come from in these 17 states.

So, if you actually took the number of people voted who got a delegate, 12,750 people had to vote for Hillary vs. 2,000 for Senator Obama.

BLITZER: But isn't it -- isn't it ridiculous to assume, if there had been a real primary in Michigan, he would have gotten zero votes?

MCAULIFFE: Well, we don't know. He made a political decision, in fairness. He was on the ballot. He decided, for political reasons, one, Hillary was going to win it. Two, to appease Iowa and New Hampshire, he took his name off.

You can't have it both ways in politics. He wanted to take it off to...

(CROSSTALK)

BLITZER: All right, let me get back to the original question.

MCAULIFFE: Sure.

BLITZER: Is it fair to "steal," in effect -- and I'm using that in quotes -- an election that the pledged delegates have determined? MCAULIFFE: Yes. No -- listen, Wolf, no one's going to steal anything. And that's why we say you got to count Michigan and Florida -- 2.3 million people voted. You can't disenfranchise what are key -- two of the key votes for us in the Electoral College.

BLITZER: So, if he says tomorrow, as we expect he will...

MCAULIFFE: Yes.

BLITZER: ... "I have reached a major milestone in my case; I now have the majority of pledged delegates behind me," you will say?

MCAULIFFE: Let's get -- you have to hit the magic number, 2,210. You have to get the number to be the nominee.

We didn't treat -- when Jimmy Carter, and Ted Kennedy ran against him in 1980, when Gary Hart took Walter Mondale to the convention in 1984, nobody treated them like they're treating Hillary Clinton today.

When you get the number to be the nominee of the Democratic Party, you are then the nominee. Why should you quit ahead of time? We're going to have a big win tomorrow in Kentucky. We had a huge win in West Virginia. We won Pennsylvania. We won Indiana.

She is winning races. You want to get Hillary off the race? Then beat her.

And, until someone gets the number, we're going to fight on. We're raising money. I'm going to South Dakota this week to open offices. We're playing everywhere.

BLITZER: All right.

You're one of the best political fund-raisers out there, former chairman of the Democratic Party.

What about these stories now that, already, some top Clinton fund-raisers, some top Obama fund-raisers, they're beginning to talk to each other about working together down the road against John McCain.

MCAULIFFE: Well, we should do that.

In 2003, when I was chairman of the party, if you remember, I held eight unity events, where I had every candidate attend who was running, and all their fund-raisers helped.

BLITZER: Are these discussions going on already?

MCAULIFFE: Yes, sure. We're all saying we're going to help the ultimate nominee win.

BLITZER: So, you're giving the blessing to your fund-raisers to go ahead and talk to Obama fund-raisers?

MCAULIFFE: What we're doing is say, anything we can do to help the party.

No matter who comes out, we have got to make sure the DNC is well funded, because we have a lot of money to raise. So, we're doing it. As I say, I did it when I was chairman in 2004. We had the huge unity dinner, remember, on March 25. We had all the candidates come together. We're getting ready for the general election.

We're all going to come together. I tell everybody this. We have two weeks of voting to go. We have probably five to six million people yet to vote. Hillary is ahead in the popular vote, when you count Florida and Michigan. ABC News just put out their alert. She's moved ahead in the popular vote. We still have more people to vote. Let's let them vote.

BLITZER: The whole notion of this debate that we have seen in the last several days between John McCain and Barack Obama over national security, Iran, Hamas, and all of this...

MCAULIFFE: Yes.

BLITZER: ... Hillary Clinton has sort of been out of that debate. She supported Barack Obama. How do you feel when you see what many pundits are suggesting is already a general campaign under way between John McCain and Barack Obama?

MCAULIFFE: Well, Hillary has had many an issue with John McCain in her past. She has fought with him on many issues in the past.

But they -- you know, they said that he was going after Senator Obama. Senator Obama rightfully came back. I still think George Bush is the culprit in all of this. To go to the Knesset and attack American political leaders I just thought was so over the top. It doesn't surprise George Bush did it.

BLITZER: Because he denies that that was his intent.

(CROSSTALK)

BLITZER: But he never mentioned Democrats.

MCAULIFFE: Yes.

BLITZER: He never mentioned Barack Obama, never mentioned Hillary Clinton. He said some.

MCAULIFFE: Yes.

But, in fairness, the White House press -- press corps was tipped off ahead of time, before he gave the speech. He said, we're going to go after Obama. His own people admitted they did it.

So, you know, this was Bush once again trying to play games. He shouldn't do it with our national security. But the point is, Wolf, national security is what John McCain is going to run this election on. If you look at the polling data, Hillary Clinton is the best to take on John McCain on national security issues, her work on Armed Services. Thirty-five generals and admirals have endorsed her. They know, Americans know she will be tough on national security.

BLITZER: He's getting a lot of superdelegates who are crossing over. Robert Byrd, the longtime senator from West Virginia, a state she carried decisively, overwhelmingly, he's now come out for Barack Obama. What do you think of that?

MCAULIFFE: Well, you know, last week, when they declared the race over, even the week, you would have thought literally 50, 60, 70 superdelegates, Wolf, would have come out. That didn't happen.

So, you know, every day, two or three. We had three over the weekend. So, every day, superdelegates are coming out. But it hasn't been the rush that I think a lot of people had thought it would be. A lot of people had hoped, after tomorrow night, he would have the total number of superdelegates and pledged delegates. That didn't happen. And, yet, a record number of people came out...

(CROSSTALK)

BLITZER: So, you're -- you're -- you're predicting a big win in Kentucky tomorrow?

MCAULIFFE: Mm-hmm.

BLITZER: He will win, you think, in Oregon? At least the polls -- polls suggest that.

MCAULIFFE: Polls show that he would win in Oregon. Then we go on to rules and bylaws on the 31st.

(CROSSTALK)

BLITZER: That's when the DNC has their meeting...

MCAULIFFE: Right.

BLITZER: ... to determine the fate of -- of Michigan and Florida.

MCAULIFFE: That's right.

Then Puerto Rico on the 1st, which you and I have to be at, and then, of course, June 3, South Dakota and Montana.

BLITZER: San Juan, here we come.

MCAULIFFE: Pina coladas, Caribe Hilton. Get out there.

BLITZER: A beautiful island.

MCAULIFFE: Suntan lotion. We will be great out there.

BLITZER: Thanks, Terry McAuliffe, for coming in.

MCAULIFFE: Thanks, Wolf. BLITZER: President Bush is saying no to any bailout for lenders. Where does that leave borrowers reeling from the mortgage mess? We're going to tell you where Mr. Bush stands on issue number one, the economy.

Also, is Barack Obama being presumptuous when he refers to himself as the Democratic nominee? Our "Strategy Session," that is straight ahead.

And, later, can Obama actually get Republicans to lay off his wife, Michelle? We're looking at the strategy of targeting spouses -- all that and a lot more coming up right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: President Bush says it's a tough time right now for a lot of Americans, amid the economic downturn. He's promising to help credit-worthy people stay in their homes. But he has a different message for lenders.

Let's go to our White House correspondent, Elaine Quijano. She's watching this story for us.

All right, what did the president say, Elaine, about bailing out mortgage lenders?

ELAINE QUIJANO, CNN WHITE HOUSE CORRESPONDENT: Well, he doesn't support it, Wolf, in a nutshell.

President Bush, fresh off a visit to the Middle East, is anxious to show that he's fully engaged on the domestic front. That's why, today, we saw him in the Oval Office sitting down with Treasury Secretary Henry Paulson.

Now, the president once again acknowledged the very tough economic times many Americans are facing right now, but he reiterated that any legislation Congress puts together to help struggling homeowners should not come in the form of bailouts for lenders.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: Laws shouldn't help speculators. The government ought to be helping credit-worthy people stay in their homes.

(END VIDEO CLIP)

QUIJANO: Now, the president went on to say that one way to do that is to reform Fannie Mae and Freddie Mac, of course the government-sponsored companies that finance home loans.

And he said that Congress is making progress in doing just that. Now, as for the economic stimulus checks, President Bush said, again, he feels it is just too early at this point in time to consider a second stimulus package, the president saying that those first checks are still going out right now, and they should be given a chance to work before a second package is even considered -- Wolf.

BLITZER: All right, Elaine, thank you for that update.

Coming up in our "Strategy Session," Mike Huckabee on the Republicans' ticket? He seems to like the idea.

(BEGIN VIDEO CLIP)

MIKE HUCKABEE (R), FORMER ARKANSAS GOVERNOR: I would have no difficulty running with him, in the sense that I wouldn't have to take back anything I ever said on the campaign trail, publicly or privately.

(END VIDEO CLIP)

BLITZER: But what do the oddsmakers think about that? You might be surprised. Stand by for that.

And Barack Obama's talking like a general election candidate, but is he jumping the gun? Donna Brazile and John Feehery, they are standing by live -- right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Barack Obama may soon be set to declare mission impossible in the race for the Democratic presidential nomination. But Hillary Clinton's campaign says, not so fast.

Joining us now in our "Strategy Session," our CNN contributor, the Democratic strategist Donna Brazile. She's not yet endorsed a presidential candidate. She's a superdelegate in her own right. Also joining us, Republican strategist John Feehery. He supports John McCain, no ifs, ands or buts, right?

JOHN FEEHERY, REPUBLICAN STRATEGIST: He's my man.

BLITZER: All right.

Here's what Barack Obama, Donna, said yesterday. And we will -- we will interpret what he means.

(BEGIN VIDEO CLIP)

B. OBAMA: Everybody's surprised that I'm standing here. Nobody thought, you know -- well, I appreciate you, but -- but let's face it. Nobody thought a 46-year-old black guy named Barack Obama was going to be the Democratic nominee.

(LAUGHTER)

(END VIDEO CLIP)

BLITZER: All right. Is he already suggesting he's the Democratic nominee? Because Hillary Clinton says, not so fast.

DONNA BRAZILE, CNN POLITICAL ANALYST: I think what he's suggesting is -- suggesting, of course, is that tomorrow he, Senator Obama, might reach an important milestone, with capturing the majority of earned delegates. That's very important, of course, as this campaign winds down.

It is not over. Senator Clinton will continue to compete in the five remaining states, 189 delegates. This -- this campaign will not end until Senator Clinton declares Obama the nominee or Senator Obama reaches 2,025, or 2,026 because of...

(CROSSTALK)

BLITZER: You heard Terry McAuliffe say, hold on. Wait for Michigan and Florida. The DNC is going to have their own meeting May 31. So, that number may not be accurate. It's for 48 states, plus the territories, not for all 50.

FEEHERY: People of West Virginia and the people of Kentucky might disagree, but Barack Obama is going to be the nominee.

And, actually, this is good for Republicans. We can start focusing on Barack Obama's policies, what he really believes he wants to do with the country, how -- his tax policies, things like that. We can start focusing on Barack Obama and clarify this race once and for all.

BLITZER: So, you think he's jump -- basically, is he jumping the gun?

BRAZILE: Absolutely not. Look, he -- he's still competing. He was in Oregon yesterday, 75,000 people, and that's without Madonna or you and I, Wolf.

BLITZER: Or Oprah, for that matter.

BRAZILE: Oprah. That's a huge crowd.

No, he's still competing from every state, every vote, every delegate. Senator Clinton is doing the same.

BLITZER: I don't remember a candidate getting these kinds of turnouts at these events. Do you? Has McCain ever got 75,000 people to show up for an event?

FEEHERY: I think McCain likes to play to smaller, more intimate audiences, because he's kind of a folk singer type, whereas Barack Obama is the rock star. Definitely, he's a rock star. He plays to these big audiences.

Young people like to come out, a beautiful day out in Oregon. So, people wanted to party a little bit, have a fun time. But I'm not sure if that's going to mean the same in the ballot box. We will see. I don't think so.

BLITZER: Let's have some fun. Talk about vice presidential running mates, assuming -- and it's assumption right now -- Barack Obama and John McCain. There's a Web site in Britain, a gambling Web site, if you will, that gives odds to anything, almost, but especially on political running mates for American presidents. Let's do the Democrats first.

Right now, this Betfair.com, it has Hillary Clinton at 5-1, John Edwards as 11-1, Al Gore as 32--1. What do you think about the odds that are on this British Web site, this betting site, right now?

BRAZILE: Well, I like all three candidates. And I don't know if that would necessarily be my order. And, in fact, I would add a couple more.

BLITZER: Who else?

BRAZILE: I think Joe Biden should be on the short list. I think Bill Richardson should be on the short list. I think the people who Obama and Senator Clinton ran against all should be on the short list.

BLITZER: You were the campaign manager for Al Gore. What do you think the odds are that Barack Obama, assuming he gets the nomination, would pick Hillary Clinton to be his running mate?

BRAZILE: I don't think he can rule it out, but, clearly, it's premature to talk about...

BLITZER: Is it 5-1?

BRAZILE: Well, I don't know, Wolf. I have never been a betting woman. Every time I go to Las Vegas, I keep my coins in my purse.

(LAUGHTER)

FEEHERY: I think these oddsmakers are crazy. I think the odds- on favorites are Ted Strickland from Ohio, because Obama needs that state, or Ed Rendell in Pennsylvania, because he needs that state. Kathleen Sebelius, probably 70-1 to 80-1, is a little bit of an outsider.

BLITZER: And reaching out to a Clinton supporter would -- short of actually picking Hillary Clinton, you think that would send a powerful message?

FEEHERY: I think that is where -- Obama's going to go with a safer call. Al Gore is not going to take this. Neither is John Edwards. I think they have been there, done that, and they're not going to do that.

BLITZER: Do you agree?

BRAZILE: I have to agree on the Al Gore question.

(LAUGHTER)

BRAZILE: I don't know about John Edwards. I can't -- but Claire McCaskill...

BLITZER: He's already been vice -- he's already been vice president of the United States.

(CROSSTALK)

BRAZILE: We should also mention Claire McCaskill. She's a dynamic woman. I would also like to see -- on my short list as well, if Senator Obama ever calls me.

(LAUGHTER)

BLITZER: Maybe he will. After this interview, he might. You never know.

BRAZILE: OK.

BLITZER: Are you ready to accept, if he does? Would you like to be vice president?

BRAZILE: No, sir. Absolutely not.

(LAUGHTER)

BRAZILE: I think the country is in better hands with Senator Obama and Senator Clinton than me.

BLITZER: I think I trust -- I trust you, Donna.

All right, let's talk about the Republicans right now. The same Web site, Betfair.com, has Condoleezza Rice, the secretary of state, 25-1, Mike Huckabee 15-1, Mitt Romney 14-1.

What do you think?

FEEHERY: I think that's pretty close to being rather accurate. I would throw out two dark horses, Eric Cantor, who is probably about 15-1 to 20-1.

BLITZER: He's a very young guy.

FEEHERY: Young guy that...

(CROSSTALK)

BLITZER: He's the congressman from Virginia.

FEEHERY: Virginia. And he's a smart guy. He's a good fund- raiser. He's good on policy.

And I would also add Rob Portman, about 15-1 to 17-1. He's another smart guy who actually gets the policy and fairly on the young side. I think that -- and, actually, I think Mike Huckabee would be the favorite, in my view, because he really sews up the solid South.

And another person I would put on, I always put him on my list, about 35-1, would be Joe Lieberman. You never know.

BLITZER: Here's what Huckabee said yesterday about possibly being a vice presidential running mate.

(BEGIN VIDEO CLIP, "MEET THE PRESS")

HUCKABEE: There's no one I would rather be on a ticket with than John McCain. Whether or not I do the best for him, that's something that only he can decide. I'm going to support him, because I think he's the right person for America.

(END VIDEO CLIP)

BLITZER: What do you think? Would that be a formidable ticket, John McCain/Mike Huckabee?

BRAZILE: Well, I think it's not a match made in heaven, but I think that Mr. Huckabee could add a lot of tunes to John McCain's song list, because he doesn't have a lot of things to say.

Look, I think Pawlenty of Minnesota would be a great -- Governor Sanford of South Carolina. I think he's going to have to pick someone who can help him on domestic issues and help him reach across the aisle.

BLITZER: There are some conservatives who have a lot of problems with Mike Huckabee on domestic economic issues, as you well know.

FEEHERY: That's true. But what Huckabee gives you is the solid south. He will help get out the Southerners who just are not -- don't trust McCain.

And then McCain can go with the rest of the country. I think he's a very articulate guy, Huckabee. He's got a great sense of humor. He's got a great -- great story to tell. And he did a pretty good job as governor, even though some conservatives don't like him on tax issues.

BLITZER: And he outlasted a lot of those other Republican presidential candidates in the run, too.

FEEHERY: Absolutely. Absolutely.

BLITZER: All right, guys, thanks very much for coming in.

BRAZILE: Thank you.

FEEHERY: Thank you.

BLITZER: Not running for president, right?

BRAZILE: But Bob -- Robert Byrd is my hero today.

(LAUGHTER)

BRAZILE: Because he endorsed Barack Obama.

BRAZILE: Because he did something that I never thought I would live to see. BLITZER: Tell me why.

BRAZILE: Because Robert Byrd, a former member of the Ku Klux Klan, endorsed a black guy for president. That is historic.

BLITZER: Good point.

BRAZILE: So, he's my hero of the day.

BLITZER: Donna, thanks very -- thank you.

Back in the spotlight -- Geraldine Ferraro makes some more controversial remarks. We will tell you what she's now saying.

Also, joining forces? The DNC signs a joint fund-raising agreement with the Clinton and Obama campaigns. But will the presidential rivals join up?

And Oregon and Kentucky, tomorrow's primary states, we're going to take a closer look at the voters who may push Obama over the top in at least one of those states, over the top in the majority of the pledged delegates.

Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: On our Political Ticker this Monday, new evidence Hillary Clinton is poised for a landslide victory in Kentucky tomorrow. CNN averaged the results of three of the latest surveys from the state. It shows Clinton leading Barack Obama by a whopping 30 -- 30 -- points. Obama, in turn, seems poised for a strong win in Oregon's primary tomorrow. Our poll of polls averaging three surveys from Oregon shows Obama leading Clinton by 10 percentage points.

The former Democratic vice presidential nominee, Geraldine Ferraro, is quoted today as saying she may not vote for Barack Obama this fall if he becomes her party's nominee. Ferraro is a Hillary Clinton supporter. You may remember, she resigned from a finance post on the Clinton team after she made remarks about Obama that some viewed as racially offensive.

Ferraro tells "The New York Times" she thinks Obama has been -- quote -- "terribly sexist" over the course of the presidential campaign.

While Democrats try to tie John McCain to President Bush, GOP officials reportedly are enlisting Mr. Bush for three events to help McCain's campaign. "The New York Times" reports, the president is invited to a Phoenix fund-raiser with McCain next week, as well as a luncheon in Utah with Mitt Romney, followed by an exclusive dinner at Romney's vacation home there.

And a breakfast date worth noting and likely to fuel V.P. speculation. CNN confirms John McCain shared a morning meal with the New York City mayor, Michael Bloomberg, in New York over the weekend -- no word on what the all-but-certain Republican nominee and the former Republican-turned-independent-mayor discussed. But we're digging for information.

And, remember, for the latest political news any time, you can check out CNNPolitics.com. That's where you can download our new political screen saver and where you can check out my latest blog post. Wrote one and filed it, posted it just before the show.

Let's go back to Jack for "The Cafferty File."

Lots of news happening today, Jack.

CAFFERTY: Indeed.

Question this hour: What message does it send to the GOP when 72,000 people show up for a Barack Obama campaign rally?

Ron writes: "I am not yet an Obama supporter, but it certainly sends a message that there is a desperate desire to turn the page on these heavy-handed, fearmongering, dishonest politicians, who have been leading this nation into an abyss of fear, debt, divisiveness, and general economic ruin."

Matt in Omaha writes: "All I can say is, McCain better have a hell of a ground game if he expects to win. I will anticipate Obama's campaign will be able to force John McCain to spend money in places he once thought were safe, because of excited volunteers like the 72,000 strong in Oregon."

Kyle writes: "Seventy-two thousand in most states would be impressive. But it's Oregon, one of the most liberal states in the country. Of course the most liberal candidate is going to be treated like a rock star there. If it happened in a state like Texas, I would say just go ahead and just give him the presidency."

M.R. in North Carolina: "When I watched news clips of McCain's speeches last week, I couldn't decide if he thought he was addressing a room of third-graders or mentally challenged adults. Obama, on the other hand, challenges and inspires the adult in each of us."

B.J. in Florida: "It seems to say people are looking for themselves to see if Obama may have plans to change politics in America. There are millions of us hoping that he can, and we want to be part of it. He comes to Florida soon. It will be interesting to see how he will be received here. Many of us are just sick and tired of the old politics as usual."

Pat in Oregon writes: "I am an Oregonian, Jack. Could not be prouder to see that awesome crowd turn out for Obama yesterday. We have tons of retirees in Oregon -- me included. The Portland area has only about 6.6 percent black population. The Republicans can only hope that they would ever see anything close to the turnout for Barack Obama yesterday."

And Paul writes from Columbia, South Carolina, "Jack, it must have been a slow TV sports day." If you didn't see your e-mail here, you can go to my blog at CNN.com/caffertyfile. Look for yours there, along with hundreds of others -- Wolf.

BLITZER: All right, Jack, thank you.

And, to our viewers, you're in THE SITUATION ROOM.

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