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American Morning

Hillary Speech Analysis; Second Convention Day Wrap-up; Giuliani Interview

Aired August 27, 2008 - 07:00   ET

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


JOHN ROBERTS, CNN ANCHOR: Obama with precious little time on his side to win them over. We're going to hear from one Texas delegate who says he's got a lot of work to do to convince her.
And Bill's big night. Tonight is the night. Is he ready to bury the hatchet? We'll ask those questions this hour. But first, let's send it back to Kiran in New York.

KIRAN CHETRY, CNN ANCHOR: Thanks, John. And you know, the top story today certainly is Hillary Clinton. It was her moment at the Democratic National Convention in Denver. Some of the analysts are calling it one of her finest speeches in politics and it came in defeat. Senator Clinton saying the time is now for Democrats to unite behind Barack Obama.

(BEGIN VIDEO CLIP)

SEN. HILLARY CLINTON (D), NEW YORK: I haven't spent the past 35 years in the trenches, advocating for children, campaigning for universal health care, helping parents balance work and family, and fighting for women's rights here at home and around the world to see another Republican in the White House squander our promise of a country that really fulfills the hopes of our people. And you haven't worked so hard over the last 18 months, or endured the last eight years, to suffer through more failed leadership.

I ran for president to renew the promise of America, to rebuild the middle class and sustain the American dream, to provide opportunity to those who were willing to work hard for it and have that work rewarded, so they could save for college, a home, and retirement, afford gas and groceries and have a little left over each month.

Most of all, I ran to stand up for all those who have been invisible to their government for eight long years. Those are the reasons I ran for president, and those are the reasons I support Barack Obama for president.

(END VIDEO CLIP)

CHETRY: Now Obama dropped in on a convention watching party. This was in Billings, Montana, to watch Senator Clinton's speech. And he said he thought she was outstanding. He also called Clinton to thank her for her support -- John.

ROBERTS: Kiran, thanks very much. So how did Hillary Clinton do in her attempt to unite the Democratic Party behind Barack Obama? Joining me once again is our panel. Jennifer Palmieri is a Democratic strategist; Chip Saltsman, Republican strategist; and John Avlon, an independent political analyst.

Let's listen to a little bit more of what Hillary Clinton said last night, specifically on this point of bringing people together.

(BEGIN VIDEO CLIP)

SEN. HILLARY CLINTON (D), NEW YORK: Whether you voted for me or you voted for Barack, the time is now to unite as a single party with a single purpose.

(END VIDEO CLIP)

ROBERTS: Every review I have seen of that speech says that she was utterly convincing in what she said last night. But will the supporters follow, Jennifer?

JENNIFER PALMIERI, DEMOCRATIC STRATEGIST: I think that, I mean -- you know, that's to be seen. But she has done absolutely everything that I think she can do to bring them along. And she just offered like it's for no refuge to any of her supporters to think that there's any place that she wants to go other than Barack.

ROBERTS: Right. You know at the same time that Hillary Clinton is using her words to try to bring the party together, over on the McCain side of things they're using her words to try to divide the party.

This is the new 3:00 a.m. ad that came out yesterday, the same day that she gave her speech. Let's listen to one particular excerpt from it.

(BEGIN VIDEO CLIP, CAMPAIGN COMMERCIAL)

SEN. HILLARY CLINTON (D), NEW YORK: I know Senator McCain has a lifetime of experience that he will bring to the White House. And Senator Obama has a speech he gave in 2002.

NARRATOR: Hillary's right.

(END VIDEO CLIP)

ROBERTS: So there she is saying that John McCain has got a lifetime of foreign policy experience, the dig on Barack Obama. Everybody says, oh, you know, during the primary campaign it's a campaign. You say things. But, you know, how do you come back from that?

CHIP SALTSMAN, FORMER HUCKABEE CAMPAIGN MANAGER: hat was harsh and powerful. And one of the things that she didn't talk about last night was addressing Obama's lack of experience. What she was the most critical of during the primary, because for her it was about experience. And I think the people in the hall, she got last night. But the people in rural America, those folks in Ohio, in Pennsylvania, the ones that voted for Hillary that were so supportive, I'm not sure that speech last night is going to seep down and get them because she didn't talk about the primary issue which was his experience.

ROBERTS: Well, what about for independents, John...

UNIDENTIFIED MALE: Exactly.

ROBERTS: ... who are looking for some confidence that Barack Obama would be an effective commander in chief?

JOHN AVLON, AUTHOR, "INDEPENDENT NATION": For independents that kind of ad is devastating, I think, because it uses the words against the candidate and she did not go out of her way to answer that experience argument, which she knew was being leveled at her. That's the classic Washington definition of a gaffe. She told the truth and that's powerful.

ROBERTS: Jennifer, you know, you've known Hillary Clinton for a long time. You used to work in the Clinton White House. As I said, that the favorite way of explaining this away is to say that was during the campaign. A lot of things are said. But how do you really reconcile that with what she said and what she's trying to do now?

PALMIERI: I think that, you know, what the -- I mean, obviously that is not a helpful ad. But go ahead and convince them through here. But I think in terms of what she can contribute and what she needs to do, I don't know that she's ever going to convince any independent voters to be for Obama, but she needed to convince her supporters.

I don't think her supporters are concerned about, you know, the 3:00 a.m. ad. They want to see that she is -- you know, that she's personally committed and that she really wants to do it. So I don't know that she needs to do that last night.

ROBERTS: So knowing Bill Clinton as you do, and again, I first met you when I was a White House correspondent, you were in the Clinton White House.

PALMIERI: I'm afraid that was almost 10 years ago.

ROBERTS: It was a long time ago. What do you expect him to say tonight?

PALMIERI: There is no way Bill Clinton is walking into this arena and not knocking it out of the park, right? I mean, he loves nothing more than to face an audience that's a little questionable and do really well.

I think that -- and you know, he's really great in the sort of framing the choice. I don't know that he's going to be saying a lot of great things about Barack Obama but he's great at framing the choice. I don't know if he'd think of that.

ROBERTS: Do you think he'll be doing it with a little cloud over his head?

SALTSMAN: Well, I think it's going to be -- the good news is for Democrats it's going to be exciting because they love Bill Clinton. He's going to electrify this crowd. This convention has not had a lot of those moments. But, again, are we going to have a Bill Clinton speech about Bill Clinton? Or are we going to have him talking about Barack Obama?

AVLON: Or is he going to be talking about the Democratic Party? Or is he going to be talking about Barack Obama? Bill Clinton does have great credibility with independents, but he's got to go.

Remember, the wounds that Barack Obama's suffering from right now, the inexperienced liberal label, come from the Clintons' late primary campaign. So they have more of an obligation to heal those wounds. They've got to do it and go the extra effort.

ROBERTS: We'll see if they could do a one-two punch tonight.

John, Chip, Jennifer, thanks. We'll see you again next hour.

Here's what we're working on for you this morning here on the "Most News in the Morning." Whether former President Bill Clinton can bury the hatchet. He came down hard on Barack Obama during the primary season. As John was suggesting, many Democrats hoping that he sticks to the script tonight.

And a delegate holding back tears as she talked about her commitment to Hillary Clinton, saying she has no connection to Barack Obama. Proof that primary season is not all in the past.

From the Pepsi Center in Denver, Colorado and the Democratic National Convention, you're watching a special edition of the "Most News in the Morning."

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

SEN. HILLARY CLINTON (D), NEW YORK: To my supporters, to my champions, to my sisterhood of the traveling pantsuits, from the bottom of my heart, thank you.

(END VIDEO CLIP)

CHETRY: Hillary Clinton's pantsuit comment certainly got quite a roar from the crowd. And the pantsuits traveled all the way to Denver. Here they are early in the day for a light test and it looks like orange passed.

Well, Senator Clinton was able to poke a little fun at herself, and many other lines from the night came from Pennsylvania Senator Bob Casey on John McCain and the Bush tax record. Take a listen.

(BEGIN VIDEO CLIP) SEN. BOB CASEY (D), PENNSYLVANIA: John McCain calls himself a maverick, but he votes with George Bush over 90 percent of the time. That's not a maverick. That's a sidekick.

We can't afford four more years of deficit and debt, and drift and desperation. Not four more years. Four more months.

(END VIDEO CLIP)

CHETRY: There were critics who said the Democrats were not tough enough on the other side during day one of the convention. So they certainly made up for it on night two, John.

ROBERTS: They certainly did. We'll see what they do on night three because now it's Bill Clinton's turn. He has had past conventions in the palm of his hand. But tonight, he's going to play a much different role.

CNN's Dana Bash joins me now with a preview of Bill Clinton's speech. Jennifer Palmieri a couple minutes ago said she expects that he's going to knock it out of the park. What do you think we're going to hear?

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT: Well, you know, whether he knocks it out of the park, where I'm told is that what he's going to try to do is set up contrasts between the Democrats and John McCain in the way that he thinks it should be framed.

You know, you know very well there is pretty much nobody in politics, Democrat or Republican, who does not think that Bill Clinton is perhaps the greatest communicator of his generation. But even for him, persuading the people in this hall tonight that he is for Barack Obama may not be easy.

(BEGIN VIDEOTAPE)

BASH (voice-over): Bill Clinton's friends insist, like his wife, he's ready to bury the hatchet.

TERRY MCAULIFFE, FMR. CHMN., HILLARY CLINTON CAMPAIGN: I speak to the president frequently, almost every day. And I know, you know, he is -- his mindset now is the past is the past and we've got to move forward.

BASH: Yet on the eve of his convention speech, the former president raised a question that raised eyebrows about whether he's really ready to push for Barack Obama.

BILL CLINTON, FORMER PRESIDENT OF THE UNITED STATES: Candidate X agrees with you on everything, but you don't think that person can deliver on anything. Candidate Y disagrees with you on half the issues, but you believe that on the other half the candidate will be able to deliver. For whom will you vote?

BASH: Whether or not that was one last moment that Hillary was better, associates promise tonight he'll play the dutiful role of unifier in chief.

MCAULIFFE: Make the case that it's an important year for a Democrat to win the White House, House, Senate, and we have to get behind Barack Obama.

BASH: But some Clinton confidantes tell CNN he's frustrated Obama has not done more to seek his counsel in battling Republicans. He plans to use his public address to offer some advice. Draw parallels with criticisms about inexperience he faced as a young candidate.

GEORGE H.W. BUSH, FORMER PRESIDENT OF THE UNITED STATES: My dog Millie knows more about foreign affairs than these two bozos.

BASH: And not so subtly urge Obama to step up the tactic he used successfully in his campaign of change. Pound away at Republicans for a broken economy.

MCAULIFFE: Get this economy moving again and the real differences between Senator Obama and Senator McCain. And that's what he's going to focus on.

(END VIDEOTAPE)

BASH: Now one of the many reasons there is so much anticipation and there's going to be so much interest in tonight is actually, John, because we haven't heard Bill Clinton talk about Barack Obama, campaign for Barack Obama at all in the 2-1/2 months since the primary ended. And that's primarily, if you talk to people close to Bill Clinton, because Barack Obama hasn't asked.

Well, yesterday Obama's senior aides let it be known that after the convention they are actually going to ask him to go out and campaign for Obama in some key battleground states.

ROBERTS: And prior to that time more than two months ago, most of what we heard from Bill Clinton regarding Barack Obama was not exactly kind. So we'll see how he changes his tune.

BASH: Exactly.

ROBERTS: Dana, thanks so much.

BASH: Thank you.

ROBERTS: What is former Republican presidential candidate Rudy Giuliani doing at the DNC? He is here with us live this morning to explain all of that.

He reviews the Hillary Clinton speech. Find out what he says she didn't say. You're watching the "Most News in the Morning."

(COMMERCIAL BREAK)

ROBERTS: And there's the candidate's wife and the running mate both clapping for Hillary Clinton and rooting for unity at the Democratic National Convention. And then there were reminders that the divide still runs very deep. One of the most telling and compelling moments of the day came after Hillary Clinton's speech when our Suzanne Malveaux went into the crowd and found a Clinton delegate holding back tears. Look at this.

(BEGIN VIDEO CLIP)

ANN PRICE-MILLS, DELEGATE FROM TEXAS: She's evidence that women would come so far. And to let gender be a hindrance, she led a phenomenal and intelligent, a powerful, a moving, a motivating person. Not move us into the next generation, not move us into the future that we deserve, not move us into the green economy that we deserve, not be able to address the concerns that we deserve.

And now, everybody just want us to suddenly shift. You just saw it yourselves. You saw it yourselves. You know that was a presidential speech. You know it.

When you guys look back at the end of this week and you start tearing apart the speeches, and you will, you know that was a presidential speech. She did everything for Obama that she was supposed to do. Now it's time for him to step up and do what he's supposed to do.

I was elected to come here as a delegate for Clinton. I will vote for Clinton. Now you ask me about my personal vote in November, Obama has two months. I won't vote for McCain. But he has to get me there.

(END VIDEO CLIP)

ROBERTS: Ann Price-Mills, delegate from Texas, last night speaking to our Suzanne Malveaux. Evidence that emotions still run very deep, saying there that she's going to give Barack Obama two months to make his case, otherwise she's going to sit this one out.

And, Kiran, the big question today is just how much of that sentiment is there across America and how might it change the next couple of days?

CHETRY: Yes, it'll will be interesting to see because that CNN/Opinion Dynamics poll we had which was taken from the weekend is showing still about 27 percent of Hillary Clinton supporters were saying they're going with John McCain, not Barack Obama. If her speech was able to change that, it will be interesting to find that out.

Well, also, outside of the political arena, John, another major story we're tracking this morning, that's Tropical Storm Gustav. It's now battering Haiti and could strike into a big hurricane as it heads toward the U.S.

CNN's Rob Marciano is standing by with the latest on Gustav's track. Hey, Rob.

ROB MARCIANO, AMS METEOROLOGIST: Hi, Kiran. This thing looked like it was going to get to cat (ph) two status yesterday before it hit Hispaniola. But it's interacting with the land, has been for the past 12 hours or so. It's been knocked down to tropical Storm force so with winds of 60 miles an hour, gusting to 70, its movement has slowed down west northwest. We have five now. And the folks in the western island of Hispaniola really getting pummeled with this thing.

All right. Where's it going to go? Tremendous amount of heat in the Caribbean both, especially in this part of the Caribbean. Temperatures well into the mid 80s and fairly deep, warm water as well. So where this goes, how much interaction it has with land, both either Jamaica or Cuba, will likely determine how strong and how quickly it will intensify.

Well, the National Hurricane Center is pretty much sticking with its track which will bring it between Jamaica and Cuba, over those warm waters, and likely intensify not only back to hurricane force but to hurricane scale one, category two, and potentially category three as it heads towards western Cuba. And the time frame is for it's a pretty deep, pretty slow. It's a Friday afternoon and then over the weekend getting into the Gulf of Mexico where there, too, the waters are very, very warm.

And the way things are setting up in the upper levels of the atmosphere, things are pretty quiet. So we could see a category three, potentially category four early Monday morning anywhere from, well, the panhandle of Florida to the Texas coastline and right now things are kind of pointing in the general direction of southeast Louisiana. That's never a good thing when you think back towards Katrina.

We'll keep you posted and hopefully things will change as we go through time. Kiran, back up to you.

CHETRY: All right, Rob. Thanks so much.

MARCIANO: You got it.

CHETRY: Well, he's a brave Republican attending the DNC. Former presidential candidate Rudy Giuliani. And he's about to review Hillary Clinton's speech right here on AMERICAN MORNING. Also, talk to us a little bit about how McCain counters the attacks from last night that a McCain administration would just be four more years of the Bush administration, still ahead.

Back to basics.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: They really need to listen to the people who don't walk around with suits.

(END VIDEO CLIP)

CHETRY: Christine Romans breaks down what could be the Democrats' key to the White House.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: This is how people live right now, and you have to meet them where they stand.

(END VIDEO CLIP)

CHETRY: You're watching the "Most News in the Morning."

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

SEN. HILLARY CLINTON (D), NEW YORK: And you haven't worked so hard over the last 18 months, or endured the last eight years, to suffer through more failed leadership. No way, no how, no McCain.

(END VIDEO CLIP)

CHETRY: Well, we've heard she brought the house down. Hit a home run. She did what she needed to do. But as Democrats desperate for unity rally behind Hillary Clinton's speech last night, what does a former presidential candidate for the other side have to say about it?

Former New York City Mayor Rudy Giuliani is here with his reaction this morning. Mr. Mayor, great to see you.

RUDY GIULIANI (R), FORMER PRESIDENTIAL CANDIDATE: Good to see you.

CHETRY: There was Hillary Clinton's speech. What did you think?

GIULIANI: I thought it was an excellent speech and from the point of view of being a Republican and a big supporter of John McCain, I appreciated the fact that it seemed to be a very technical speech about being a Democrat, supporting him as a Democrat, but she never answered the big question. The claim she made during the primaries was he wasn't prepared to be president of the United States. She never said that.

And, of course, during the day it got compounded by Bill Clinton having that speech that he gave in which he talked about candidate X and candidate Y. And he said there may be a candidate X that you agree with but you don't think is prepared to be president. And a candidate Y that you half agree with but you do believe is prepared. Who would you vote for?

Hillary never answered the question who is candidate X and who is candidate Y.

CHETRY: Well, you know --

GIULIANI: And I think that left a big gap.

CHETRY: Well, what I'm wondering though, you know, is the GOP trying to paint her into a no-win situation. If she started bringing up some of Barack Obama's weaknesses that she talked about in the primary, she would have been panned for that.

GIULIANI: Well, she doesn't have to say that. All she had to say is he's prepared to be president. She never said it. She could have talked about how she's gotten to know him, how much she believes in him, his character, his strength.

I think the reason that woman is undecided about supporting Barack Obama, the woman who is very close to Hillary Clinton, is nothing really came from the heart here. This was a very good speech. They clearly agree on the issues.

Now, Barack Obama is clearly Bill Clinton's candidate X with whom you agree on the issues but don't think is prepared to be president.

CHETRY: Well, we'll see.

GIULIANI: But I mean, we'll have to see what Bill says tonight. I'd like the answer from Bill as to who is candidate Y and who's candidate X. That was a very interesting thing that he did and at a very, very inauspicious time for Barack Obama.

CHETRY: You know, another big theme last night for many of the speakers was that a vote for McCain means a vote to continue four more years of the Bush administration. And I know, and we've talked to a lot of John McCain supporters who say, look, he's a maverick. On examples like campaign finance reform, he's gone against the Bush administration. But really, how will McCain show besides those things that he is different from the Bush administration?

GIULIANI: John McCain was a supporter of the surge, you know, for several years before the surge happened and a critic of the administration for not doing it. In fact, a much stronger critic than I think any of the Democrats. And John McCain was right about the surge and Barack Obama was wrong about the surge.

So this is a silly kind of democratic thing that isn't going to work which is why their convention I don't think is succeeding. There are reasons to attack different candidates. You cannot say if you really watched politics for the last eight years that John McCain is a continuation of George Bush. Just not so.

They agree on certain things. They disagree on certain things. And where John McCain disagreed he got in trouble in the Republican Party for being so strong about it.

CHETRY: You know, it's interesting because another place they disagree with is about how they would handle the economy, what they would do about taxes.

We have new poll out this morning. This is a CNN/Opinion Research poll showing that voters think Barack Obama would be better to handle the economy by a 51 to 43 percent margin. Has the economy become a Republican weak spot?

GIULIANI: No. Actually, given the nature of Barack Obama's coverage, the enormously favorable coverage he received that even Governor Rendell complained about the other night, it's remarkable that he has such a small edge on the economy.

The reality is that as the Americans get to know his plan to raise taxes, raise tariffs, and bring us towards socialized medicine and create a poverty fund for the world, I think Americans will realize that this would be the worst thing you could do to the economy. John McCain is going to stick to the things that worked for President Kennedy, President Reagan, and President Bush.

CHETRY: How do you pay for it all? If you lower taxes and lower the corporate tax by 10 to 15 percent, how do you pay for it all?

GIULIANI: How about you lower expenses? Which John McCain has been a hawk about all during the time he's been in Congress. After all, he came in with Ronald Reagan and he believes in the two twins of fiscal conservatism which is lower taxes but also significantly lower expenses which is what I did as mayor of New York City. That's how I paid for it. I lowered expenses. It's something that republicans and democrats have both run away from in the last four or five years. But John McCain can bring us back to that. And that is good, sound, American economics.

CHETRY: All right. It's great to talk to you this morning. A little surreal to see DNC right behind you in the background. Good luck at that convention and I'm sure -

GIULIANI: It might look a little better in St. Paul.

CHETRY: In Minneapolis, St. Paul. Rudy Giuliani, great to see you. As always, thanks.

GIULIANI: Thank you.

JOHN ROBERTS, CNN, ANCHOR: 31 minutes now after the hour. Coming to you live from Denver, Colorado, in the Pepsi Center. Day two of the - day three rather of the Democratic National Convention. And good morning to you. I'm John Roberts.

Let's recap the top stories that we're working on this morning. Hillary Clinton headlined night two of the Democratic National Convention, making her pitch for party unity. Clinton urged her supporters to back Barack Obama saying he is her candidate. She also threw in a shot at John McCain saying "no way, no how, no McCain."

Tonight it will be the other Clinton's turn. Former President Bill Clinton is set to speak after reports that he disagreed with the party over the topic of his speech. Democrats want him to speak about national security but he reportedly wanted to talk about the economy. Also taking the stage tonight, vice presidential nominee Joe Biden. Biden is expected to trumpet his own foreign policy experience as the party said securing America's future is tonight's topic.

CHETRY: The democratic convention may be turning the corner. Critics slammed it for being too soft after day one. The republicans took a persistent beating on the second night though in the speeches that were seen by millions. Jason Carroll joins us now with more on that. You know, many of the speakers, the theme was the Bush administration will continue under John McCain. It's something that they got criticized for not hammering enough the first night.

JASON CARROLL, CNN CORRESPONDENT: Yes, the critics are pleased this morning. That's for sure. Many political observers say they didn't see enough fire, didn't see enough substance from democrats on the first night of their convention. Last night Senator Clinton delivered what many democrats say the party needed.

(BEGIN VIDEOTAPE)

CARROLL (voice-over): It was not the speech she wanted to give at the convention. It was the speech she had to give in order to unite the democratic party.

SEN. HILLARY CLINTON (D), FMR. PRESIDENTIAL CANDIDATE: No way, no how, no McCain.

CARROLL: Democratic insiders say the senator from New York did not disappoint.

CLINTON: Whether you voted for me or you voted for Barack, the time is now to unite.

JAMES CARVILLE, DEMOCRATIC STRATEGIST: This is what a major league fast ball looks like. Now you've seen one.

CARROLL: Despite reports of tensions between the Clintons and Senator Barack Obama, Clinton urged her supporters to get behind Obama and brought democrats to their feet when she took aim at Senator John McCain.

CLINTON: It makes perfect sense that George Bush and John McCain will be together next week in the twin cities. Because these days, they're awfully hard to tell apart.

UNIDENTIFIED MALE: Finally, this democratic party came alive here at this convention. With some real fire.

CARROLL: Some political insiders say too many speakers from the first night of the convention were too soft on McCain. Too vague on articulating the democrats' message. But not last night.

UNIDENTIFIED MALE: John McCain calls himself a maverick. But he votes with George Bush over 90 percent of the time. That's not a maverick. That's a sidekick.

CARROLL: Several speakers echoed the theme. A McCain presidency means more of the same. More of President Bush

UNIDENTIFIED MALE: This administration failed to believe in what we can achieve as a nation when all of us work together. John McCain promises more of the same.

UNIDENTIFIED MALE: Tonight was a night for the democrats to get their house in order. And I think they did everything they possibly could to say, look, we are united. And our common adversary is John McCain.

CARROLL: Political observers say Tuesday night was one of Senator Clinton's finest moments in politics. Tonight the other Clinton gets his turn. (END VIDEOTAPE)

CARROLL: It's going to be interesting to see what he has to say. President Clinton has his work cut out for him to match or top the speech that his wife gave last night. Looking ahead, it's going to be interesting to see if polls show Clinton supporters who had been withholding their support for Obama are now finally getting behind it.

CHETRY: All right. Jason, good to see you. Thanks.

CARROLL: All right. You too.

CHETRY: Well, former President Jimmy Carter saw and survived a bitter and divided democratic convention. John caught up with him in Denver. We're going to hear what he has to say about the state of the party right now.

Also, the convention is now in full swing. People at home though still worried about gas prices and food prices on the rise. Could focusing on the economy be the real key to the White House? You're watching the most news in the morning.

(COMMERCIAL BREAK)

ROBERTS: Daughtry saying of course and now it's up to you to do it. First time voter got questions? We got answers for you. Just head to ireport.com/league and be part of the league of first time voters, right here on CNN.

It's 38 1/2 minutes after the hour. Senator Hillary Clinton's speech was all about unity. And in attendance was former President Jimmy Carter who knows all too well about a divided convention. I sat down with him before Clinton took the stage yesterday and we talked about the state of the party and the convention so far.

(BEGIN VIDEO CLIP)

ROBERTS: Mr. President, it's good to see you. It's always good to see you.

JIMMY CARTER, FMR. U.S. PRESIDENT: It's a pleasure. Thank you.

ROBERTS: There was a video of you here at the convention. You walked out on stage with Rose. But you didn't speak here at the convention.

CARTER: That's right.

ROBERTS: What's the reason for that?

CARTER: Well, I had a choice. I talked to David Axelrod, who was in charge. And I saw that at the time we had that conversation there was a great deal of squabble going on between the Clintons and the Obamas, you know, with Michelle being the first night and then the second night, tonight would be Hillary and the third night would be Bill Clinton and then the last night would be Obama. And I told them that I didn't care about making a speech but I just wanted to be of maximum help. So we decided that I would go down to New Orleans. I spent all day last week in New Orleans and to make a film. And rather than my coming back on the stage and describing what I saw in New Orleans, it's going to be better to make a high quality documentary about New Orleans and how the democrats and republicans deal with crises of that kind in a different way. That was fine for me.

ROBERTS: Though some pundits have suggested that it might be your views toward Israel, the fact that some Jewish voters are still not quite sold on Barack Obama, they didn't want what they saw as potentially an antagonizing factor on the stage tonight.

CARTER: I can't deny that but I don't know anything about that.

ROBERTS: Right.

CARTER: I just know what I just told you.

ROBERTS: Let me remind you of something you said. It was back in November of 2006 on the "Charlie Rose" program.

(BEGIN VIDEO CLIP)

CARTER: He's got yet to prove substance or experience to be the president.

(END VIDEO CLIP)

ROBERTS: What changed since then for you?

CARTER: Well, at that time, as you well know, I never had met Obama. The only time I ever saw him was when he made the convention speech in 2004. I knew he did a superb job then. And I was really then hoping that Sam Nunn would run or Joe Biden would run and they would have been my choices. So that was a normal thing to say, you know, two years before he ever announced that he was going to be candidate.

ROBERTS: Mr. President, you know well the effects of going into a convention divided or there being a divide in the party going back to the 1980 convention. Are you concerned that the remains have split in the democratic party between the Barack Obama faction, the Hillary Clinton faction and do you think that that can be repaired?

CARTER: John, I'm probably the world's foremost expert on split parties. In 1980, we were never able to heal the wounds between me and Ted Kennedy, who never did endorse me. He wouldn't even shake my hand on the platform the night I got the nomination. But this year is different. I think that by the end of this week, you will see a united party. And I believe that tonight with Hillary's speech, I don't know what he's going to say, and tomorrow night with Bill's speech you're going to see a major healing process. And by the time we leave Denver, the democrats are going to be united behind Obama.

ROBERTS: Mr. President, always great to see you. Thanks for stopping by.

CARTER: I've enjoyed it. I enjoyed the music that we heard. ROBERTS: Good luck in the future, sir.

CARTER: Thank you very much, John.

(END VIDEO CLIP)

ROBERTS: Coming up on 42 minutes after the hour, fashion statements from the convention. We're going to look at some of the craziest hats and what they mean.

And how far one Grammy Award-winning musician is going to get young people to rock the vote. () is with us live.

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(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Even the leaders in the oil industry know that Senator McCain has it wrong. We can't simply drill our way to energy independence. If you drilled everywhere, if you drilled in all of John McCain's backyards, even the ones he doesn't know he has --

(END VIDEO CLIP)

CHETRY: Getting a few dig there on John McCain. It's what some of the party loyalist wanted to see from the first night of the convention as well. With all the hoopla at the convention, it looks like the audience is liking what they're hearing. How is it though playing at home to struggling Americans?

Our Christine Romans is here with that part of the story. Hey, Christine.

CHRISTINE ROMANS, CNN CORRESPONDENT: Well, Kiran, this is why some people say that they need to come out even swinging harder on the economy. This should be their signature issue. They need to hit it strong. A struggling economy.

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ROMANS (voice-over): Far from the hoopla of the convention floor are Ann and Shenia, 37.3 million Americans who live below the poverty line.

ANN, LIVING IN POVERTY: I believe they really need to listen to the people who don't walk around with suits.

ROMANS: New government statistics reveal what Ann and Shenia already know about the world's richest country. Some 18 percent of children live below the poverty line. Women make 78 cents on the dollar compared with men. That happens to be a record high. And there were 45.7 million people last year without health insurance. According to the census, that's an improvement but many worry last year's small gain may be temporary. That's because this year we've seen falling home prices, large numbers of company layoffs and skyrocketing gas and food prices. Political strategists say the economy should be democrats' signature issue, especially at the convention.

DAVID GERGEN, CNN POLITICAL ANALYST: The question is do you want to go down the road we've been on with the republicans, we're in a ditch now, or do you want to go down a new road that's much more promising?

ROMANS: That's the message some say that democrats need to hit home.

SEN. BARACK OBAMA (D), PRESIDENTIAL CANDIDATE: The time for change has come.

ROMANS: Shenia insists she wants change but also wants specifics.

SHENIA, LIVING IN POVERTY: This is how people live right now. And you have to meet them where they stand.

(END VIDEOTAPE)

ROMANS: Far from the convention floor in Kansas City late yesterday Senator Obama hammered Senator McCain for being out of touch on the economy, Kiran. And they were starting to get around in some of the other speeches last night, hitting the economy and saying it was the fault of the republican administration, but a lot of folks, a lot of political strategists say you can't hit this issue hard enough.

CHETRY: It will be interesting to see what former President Bill Clinton talks about last night because he does like to tout and trumpet the boom on Clinton years.

ROMANS: Yes, right.

CHETRY: He's supposed to talk foreign policy, though tonight, right?

ROMANS: I suspect that the President will not be able to go without saying what the economy was like under his two terms.

CHETRY: Christine, good to see you. Thanks.

Well, he's very close to the Clintons. And James Carville doesn't mince words. We're going to see what he's telling us this morning about Clinton's performance, Hillary's, that is, and President Clinton's speech tonight with the theme of national security.

And brand-new poll numbers in. Who do Americans think will be better on security? John McCain or Barack Obama? There's a new poll and some surprises this morning.

(COMMERCIAL BREAK)

ROBERTS: Ten minutes now to the top of the hour. Welcome back to the most news in the morning. The democratic convention is looking a little bit like the Kentucky derby, thanks to all of the political hats. Jeanne Moos takes a look at all of the hottest head gear in this un-conventional moment.

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JEANNE MOOS, CNN CORRESPONDENT (voice-over): OK, there's a cheese head and there's a corn on the cob, but sometimes you've got to ask -

UNIDENTIFIED FEMALE: The Mack Gnaw Bridge is on my head.

UNIDENTIFIED FEMALE: A toilet, a sink and a bathtub.

MOOS: We have finally solved the riddle why people wear silly hats to conventions.

UNIDENTIFIED FEMALE: We were told by other people who came to conventions that you will have the best time if you wear a hat.

MOOS: Especially if you like having your picture taken. Maxine Goldstein's hat represents money being flushed down the drain.

MAXINE GOLDSTEIN, HAT LADY: My biggest problem is coming through security. When you have to take your bathroom off.

UNIDENTIFIED FEMALE: My kids said that if they actually saw me on television with this hat they would leave home and wouldn't be there when I got back from the convention.

MOOS: But there are hats that can save kids from the humiliation of parental identification.

UNIDENTIFIED MALE: When you put it on like that --

MOOS: With an un-conventional moment, I'm Jeanne Moos, CNN, New York.

(END VIDEOTAPE)

(BEGIN VIDEOTAPE)

ROBERTS (voice-over): Making her pitch.

SEN. HILLARY CLINTON (D), FMR. PRESIDENTIAL CANDIDATE: Barack Obama is my candidate and he must be our president.

ROBERTS: The man who says the democrats wasted day one changes his tune.

JAMES CARVILLE, DEMOCRATIC STRATEGIST: This is a major league fast ball unlike anything we've seen in this convention.

ROBERTS: We'll ask James Carville if Bill Clinton will be the closer. It's the most politics in the morning, live from Denver.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

SEN. HILLARY CLINTON (D), FMR. PRESIDENTIAL CANDIDATE: Now, John McCain is my colleague and my friend. He has served our country with honor and courage. But we don't need four more years of the last eight years.

(END VIDEO CLIP) ROBERTS: Hillary Clinton on stage last night comparing John McCain to President Bush. But was it really enough to rally her supporters behind Barack Obama? Joining me now is James Carville, CNN contributor and campaign manager of the Clinton-Gore presidency.

CARVILLE: Good morning.

ROBERTS: We had you on 24 hours ago. You weren't very happy. You're a little happier this morning?

CARVILLE: Well, I mean, like is said, I think we - somebody showed us how to do this thing.

ROBERTS: You called it major league fast ball.

CARVILLE: It was. And it's amazing the first time you see one, when you see other pitches coming in and last night we saw a major league fast ball. I think we're in a treat for a lot of that major league fast balls. Tonight from President Clinton and Senator Biden. And I think the table is set for Senator Obama Thursday night. I think he's going to step up and really do it.

One of the things that has always irritated me is many commentators are saying, will Hillary - will she be giving us a piece of Obama because her body language, I'm not too sure. Some of the most stupid people in the world. What she did last night was, she set the table. Obama has to put the meal on that. She set them up, she did her job. That has come in, Senator Obama has to do his job. I'll sure that he will. But her -

ROBERTS: In terms of setting - she set the table. He's got to put the meal on the table. What does he need to do?

CARVILLE: I think he's got to talk about - you everything, by the way, everything that I have heard that his speech is going to be Thursday night, I am impressed with. We don't need any soaring over the press of this in the horizon and here we stand, we can do no other. I think he's got to be more conversational, direct, contrast himself with McCain, hold accountable the Bush-McCain administration for their mistakes they made, and then layout kind of clearly and plainly what he's going to do to take this country back.

ROBERTS: So you know Bill Clinton as well as anybody does. What do you expect he is going to do tonight?

CARVILLE: Well, first of all, as I said before, Senator Clinton gave hers, stand by, she's going to give us a good speech. All right. He's going to give a good speech.

ROBERTS: Well, has he ever given a bad one?

CARVILLE: No. He's got another major league fast ball. His arm is rested and he's going to throw it tonight. I think that he's going to talk about some of the things that he's talked about, the challenges - every time that somebody challenges the status quo, every time something comes in and talks about change, all the people with vested interest always come up with, oh, no, you can't do this, because who's done well in this, oil companies, drug companies, lobbyists, et cetera, they're paying. Who has done poorly in this, the rest of the people in America. The rest of the people in America will be in fact frighten into making a change. Bill Clinton is going to reassure them tonight that change is really what they want and what they needed and what's best for the country.

ROBERTS: Let me ask this question, James. She appeared to leave the door open last night for another run at the presidency and certainly she did not close the door. But if she and her husband do not do all they can to help Barack Obama get elected, should he lose, would she have the party behind her for another run?

CARVILLE: Well, you mow, we have to get through this. I have a theory and I've expressed it many times before. And I said running for president is like having sex, you don't do it once and forget about it. So what? I mean, and everybody is, they want to run again, or is she disappointed that she lost? Of course, she's disappointed that she lost. But anybody with a brain sits back and says, so what. And she went out there just like I knew that she would, she gave far and away the best speech, the most valuable speech to Senator Obama. In all of this stupid side chitchat that you hear, do you think like John Kennedy, Lyndon Johnson, Ronald Reagan, George H.W. Bush.

So politics is about dealing with things that there are and about dealing with people who are reality. She did a magnificent job last night. You know, I don't think there's any democrat out there that can think beyond the next four years. I mean I know I feel this way and I was the biggest Clinton supporter there was. We can't take another four like the last eight. I don't care what lies over the horizon. We've got immediate work to do right now. And from everything that I understand that she's going to go on the road in campaign center. There were people, by the way, who were urging Senator Obama, don't let the Clintons in the thing. They're just going to do everything - they're going to dominate it or they're so narcissistic and all this other garbage. Right now I think the Obama people are pretty doggone glad that the Clintons are in this arena.

ROBERTS: James, thanks for coming in this morning. I know it was a late night for you and I know also that you're watching that brewing storm out there with some concerns.

CARVILLE: We all are. Thank you. Thank you very much.

ROBERTS: Good to see you. Thanks, James.

CARVILLE: All right.

ROBERTS: Now, about a minute and a half to the top of the hour, coming to you live from Denver, Colorado. We're inside the Pepsi Center looking ahead to what's on tap tonight at the Democratic National Convention. Senators Barack Obama and Joe Biden's names will officially be placed in nomination and in a largely symbolic move. So will Senator Hillary Rodham Clinton's. Vice presidential hopeful Senator Joe Biden will be one of the evening's big speakers. He was practicing at the podium late last night. The other headliner, former president Bill Clinton. He's going to be talking about foreign policy this evening. Also slated to speak, Governor Bill Richardson, Senator Evan Bayh and 2004 presidential nominee John Kerry. All ahead, we'll be covering all of it for you, here on CNN.

CHETRY: John, thanks. Hillary Clinton's moment was more than just a raining endorsement for Barack Obama, she also used it to put a period on her presidential campaign while ripping into John McCain with gusto. Here's CNN's Candy Crowley.

CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT: Kiran and John, it was Hillary Clinton night at the convention. She came, they saw, and she delivered.

(BEGIN VIDEOTAPE)

CROWLEY: In the final scene of her presidential campaign, Hillary Clinton asked her supporters to come home.

SEN. HILLARY CLINTON (D), FMR. PRESIDENTIAL CANDIDATE: I want you to ask yourself, were you in this campaign just for me or were you in it for that young marine and others like him? Were you in it for that mom struggling with cancer while raising her kids?