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Campbell Brown
Markets Rebound; Candidates Prepare For Vice Presidential Debate
Aired September 30, 2008 - 20:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CAMPBELL BROWN, CNN ANCHOR: Hi, everybody.
Big surprise. The world didn't end today. The country didn't fall apart. The financial markets didn't vanish. In fact, they came roaring back. The Dow industrials closed up 485 points today, getting back about two-thirds of the 777 points it lost yesterday.
And, at this moment, we have just received word that there is breaking news coming in from Capitol Hill. The Senate has just agreed to revive the massive Wall Street bailout. Even though the House is in recess, the senators are set to vote on it tomorrow. And get this. The stakes are so high that Senators McCain, Obama and Biden apparently will be there to cast their votes.
That said, we are still very far from a done deal. It is the House that failed to approve that bailout yesterday. So, we still have a long way to go on this, folks, but a lot of optimism in the markets today, certainly a sign of progress, at least.
So, who do we have to think for this explosion of optimism? Who do we have to thank for leading us out of yesterday's pit of doom and gloom? Well, that's a very good question. And, tonight, we're cutting through the bull in search of answers.
Let's look first at who did what today. First thing this morning, President Bush went on television again and solemnly declared, for the financial security of every American, Congress must act. But he didn't explain why he could only get one-third of his fellow Republicans in the House to vote for the bailout yesterday. Of course, we know why. His approval rating is at 31 percent. He is the quintessential lame duck in the waning days of his presidency, and there's very little chance of him rallying the troops for the massive battle ahead.
As for our next president, John McCain solemnly declared today, we're in the greatest financial crisis of our lifetimes, but he didn't explain why he couldn't get more of his fellow Republicans on board for the bailout vote either. Barack Obama solemnly declared, this is one of those defining moments, when the American people are looking to Washington for leadership.
So, where was he yesterday when 95 of his fellow Democrats voted against the bailout, too?
As for lawmakers on both sides of the aisle, let me just quote "The Wall Street Journal" editorial page today: "Congress lives up to its 10 percent approval rating, a Washington elite that has earned every bit of the disdain that Americans have for it. This crowd can't even make sausage."
As we just said, though, maybe, maybe a little bit of progress here. We have just learned that the Senate will vote on a revised version of the bailout tomorrow.
Congressional correspondent Jessica Yellin joining us now from Washington.
Jessica, what do we know? What's the deal?
JESSICA YELLIN, CNN CONGRESSIONAL CORRESPONDENT: We know, Campbell, that they're working on making that sausage.
(LAUGHTER)
YELLIN: The Senate says that they are going to vote after sundown tomorrow night with a slightly altered version of the same bailout package.
The big change is that they're going to attach this measure we have all been hearing about, increasing the amount of money the federal government will insure in a bank account from $100,000 to $250,000. It's believed that will gain bipartisan support, bring along a couple more votes.
But the big picture here is that both sides of Congress are hoping that, by letting the Senate go first, they expect it will pass. That will increase the pressure on the House of Representatives to pass the bill in turn.
BROWN: And, Jessica, we know House Republicans are against it. But there are even Democrats in the House opposed. And we did hear from some of them again today. Let's listen.
(BEGIN VIDEO CLIP)
REP. PETER DEFAZIO (D), OREGON: Four hundred economists, you know, of international repute, foreign markets and others question the Paulson premise. This is a guy who's been wrong every step along the way. He told us two weeks ago everything is fine. I have no regrets. It's one of the best votes of my career. And it restored my faith in the democratic process and in the people's House of Representatives.
(END VIDEO CLIP)
BROWN: So, that's what they're up against.
So, even if the Senate approves a deal tomorrow, how, honestly, do they think is going to get passed by the House?
YELLIN: Well, they are hoping that, perhaps, because they are -- let me put it this way. A lot of the members have been hearing from constituents saying exactly what you heard DeFazio say right there, that they don't want this passed, they are against this, overwhelming opposition from voters.
In the last day, since this vote failed, slight change in the calls. They're starting to get calls from voters saying, listen, we want you to pass this. You have got to do something. Still, the majority are against it, but there's a shift toward passage.
And leaders are hoping that that shift will put pressure on these members of Congress to change their votes.
BROWN: All right, Jessica Yellin for us from Capitol Hill tonight -- Jessica, thanks very much.
Let's stay with our breaking news now. As we just said, the Dow industrials roared back from yesterday's 777-point drop with a 485- point gain. And that was even before we got word that the Senate will vote on its own version of the bailout tomorrow.
Senior business correspondent Ali Velshi has been working the phones, working his own sources.
And let me get your reaction to this. What does it mean?
ALI VELSHI, CNN SENIOR BUSINESS CORRESPONDENT: Bit of a non- entity at moment, because we have had enough head fakes about what's going on, on Capitol Hill. We have been hearing about deals for a while.
So, yesterday, we saw the 777-point drop, the biggest point drop ever on the Dow. But remember that the failure of this deal showed up at 2:00 yesterday and the market only had two hours to really understand it. And I think everybody has had a civics lesson in the last day, so we saw a dramatic improvement today.
Yesterday, you saw that big drop. We made about two-thirds of it back today. The bottom line here, though, is that until there is news that the House, those holdouts -- and we still don't know what those holdouts were holding out for entirely -- until we know they're going to support this bill, the problem is, you are not going to see a massive reaction on the market.
And if you do and if you're invested in the markets and if you have a 401(k) or an IRA, don't worry about this. This volatility -- I said last night, Campbell, that you can make the 777 points back in two days. We're already halfway there. Don't worry about this volatility. It shouldn't change your investment strategy right now.
This is just that the markets are following Washington and they're a little confused right now.
BROWN: And, Ali, both presidential candidates definitely inserting themselves in this in every way possible, at least at this stage. We heard Jessica Yellin a minute ago report that they're both supporting this idea of raising the FDIC insurance cap and it's included in this new Senate bill. Tell us about that or tell us a little more about it. And do you think it's a good idea? VELSHI: After the failure of a few banks, many Americans are now familiar with the fact that you're insured up to $100,000 in your name, in your spouse's name, and a joint account. So, you can have a few hundred thousand dollars in the bank.
But $100,000 is the number most people have in their head. Now both candidates are saying we should increase that limit to $250,000 a person. Let me tell you what that is actually going to do. If you were to increase the limit, first of all, if you had $250,000, you just could put it in three bank accounts. It wouldn't really matter.
But the reason that you would increase this is threefold. One is that it prevents a run on the banks. And when you think back to the Depression, one of the big problems is 1,400 banks failed because people took their money out of the bank. Businesses use that money. So, if people put their money in their mattresses, that freezes up credit even more.
It helps small businesses. Many small businesses, you don't have to be very big to need more than $100,000 in your account to pay suppliers and make payroll. So, it means businesses don't have to keep separate accounts.
And, number three, it's largely psychological. This is an assurance from the government that we're taking care of your cash. We may not be able to do anything about the stock market. We may not be able to do anything about the credit freeze, but your cash that is in the bank is safe. Don't take it out and put it in your mattress. That's the big deal here -- Campbell.
BROWN: Words of wisdom. Ali Velshi for us -- Ali, thanks.
So, what about the people who are really supposed to be in charge? That would be us, voters. It turns out you do have a lot to say about this. Listen to this.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: I don't think we're going to go into a depression. I don't think that by any means. But the thought of the possibility of it scares me to death. I don't want to get anywhere near it.
(END VIDEO CLIP)
BROWN: Now, that's the view, that's the view that a lot of members of Congress say has influenced where they are in all this, the anger they're hearing from their constituents. We are going to talk to some of those members, hear from them about what exactly they have been getting, which is an earful from people back home.
That's when we come back.
(COMMERCIAL BREAK)
BROWN: We're following breaking news here in the ELECTION CENTER tonight. The massive bank bailout has come back to life.
The U.S. Senate will vote on it tomorrow night. We're told Senators McCain, Obama and Biden are planning to be there to vote, Tony Blankley, visiting senior fellow at the Heritage Fellowship and co-host of the radio show "Left, Right and Center," with us tonight, Eamon Javers, financial correspondent for the Politico Web site, and Roland Martin, CNN political contributor, syndicated columnist, national radio commentator who says he's voting for Barack Obama.
Welcome to everybody.
Let me get your reaction to what we're just learning from the Senate.
Tony, how big of a deal is this? Should we be more hopeful now, or was -- we always knew the Senate was going to support this and the House is still the big problem?
TONY BLANKLEY, FORMER NEWT GINGRICH SPOKESMAN: Well, I think the latter. I think we expected not to be a fight in the Senate.
I'm a little curious because, unless they have got the votes in the House lined up, how do they know what modifications to make to the bill that the senators are going to vote on tomorrow?
BROWN: So, what do you think they're up to?
BLANKLEY: Well, I assume they're following the theory of try to build momentum in the easier house and then go to the harder house and sort of say, come on, finish the job. Then they would have to go to a conference committee and go and reconcile the two different bills, if they are different, then vote a second time.
I guess that's the path they're taking, as opposed to trying to find out what the House members need to get to 218, and then voting on the identical things in both bodies.
BROWN: Eamon, let me get your reaction to this. Is building momentum for it enough, given the resistance we saw from both House Republicans and Democrats?
EAMON JAVERS, "THE POLITICO": Well, it's designed to do a couple things.
One of them is to send a message to Wall Street that, look, help is on the way here, Congress is going to act, we will get half of the voting done, maybe as early as tomorrow night, as we're saying -- as we're learning just now. Meanwhile, they will have the time to negotiate with those House Republicans and figure out sort of what they can sprinkle on top of this bill to make it palatable. Those are called the sweeteners. And they're negotiating over several things they can add to this bill, even as we speak tonight, that would get those House Republicans on board.
So, by voting in the Senate tomorrow, they buy time to continue those negotiations with the House. And then they will pull it all together in some kind of conference report later. So, it's very high- stakes poker going on right now.
BROWN: Talk about, Roland, the marketing of this, the -- or the lack of salesmanship, I guess you could say. There's plenty of blame to go around, from the president to Republican leaders to Democratic leaders to both members of Congress, who played a little -- I mean, to both presidential candidates, who certainly played a little bit of politics with this.
All that said, what do they do now? Who steps into the void and makes this thing happen?
ROLAND MARTIN, CNN CONTRIBUTOR: Well, frankly, it has to be a collective. You have to have McCain, Obama, the House Democrats, House Republicans, Senate Republicans, Senate Democrats, and, more importantly, the person sitting in the White House also, all working to explain to the American people, this is what is going on.
You can't sit here and just throw out, oh, this is dire, we could have a meltdown. People have to have tangible things. Just imagine, imagine if somebody came to you Campbell and said, you know, Campbell, I need $20,000. If you say, I'm going to empty my bank account to help you out, you better really explain to me how badly you need this. But they haven't don it.
BROWN: Yes. But, Roland, President Bush went on television and gave a speech that was fairly thorough in terms of in his explanation.
(CROSSTALK)
MARTIN: No, but it wasn't.
First of all, what he laid out is, well, in terms of how difficult our economy is, things may actually melt down on the Congress. People don't understand that. When you begin to say, America, here's the reality, as Ali has been laying out, you could very well lose your job because companies cannot be able to borrow money, people get that.
If you don't have hearings, if you don't have anything along those lines, folks don't understand it. They simply see this as hooking up Wall Street.
BROWN: But, very quickly, Tony, there's no time for hearings or anything like that, according to what they're telling us. This has got to be done quickly, right?
BLANKLEY: Right.
And, also, it's easier said than done to find a message that is going to convince the public, because not only is the public confused, but most of the experts in Washington are confused. Most of us pundits are confused.
And so what is the message you tell the public? The public is baffled and they're split three ways. I don't think there's anything that anyone around here is likely to say that is going to un-baffle them. So, this is really more of an inside game of trying to get the -- the last 12 members split between the two parties to flip, rather than persuade 300 million Americans about something that nobody understands.
(CROSSTALK)
BROWN: All right, stand by, guys. We're going to talk more about this in just a second.
But, as we mentioned, the Senate will vote on the Wall Street bailout plan tomorrow night. Progress? Apparently, not, if you listen to our guys here, the House still not on board and a crucial part of all this.
Joe Johns has been talking to some members of Congress who voted no on that bailout package.
And, Joe, give us a sense of where they are and what happens now.
JOE JOHNS, CNN SENIOR CORRESPONDENT: Well, Campbell, if you're a member of Congress, this is one of those votes you can sort of define your career on Capitol Hill. The jury obviously is still out on the real implications of it.
The best thing you can say tonight is that some of the members who voted against the bill still think they did the right thing.
(BEGIN VIDEOTAPE)
JOHNS (voice-over): The White House and all its men, the leaders on Capitol Hill and the presidential candidates all wanted the bailout to pass. So, why did it fail? The Congress said, wait a minute, from both the left...
REP. DENNIS KUCINICH (D), OHIO: I voted against this because they didn't have any way of helping out the millions of American homeowners who are either in danger of bankruptcy or who are currently struggling to be able to survive financially. And that was a major flaw in the legislation.
JOHNS: ... and from the right.
REP. JOHN CULBERSON (R), TEXAS: I'm not going to bankrupt my daughter for the benefit of these Wall Street banks who made bad decisions.
JOHNS: Especially in the West and in John McCain's home state, members of the House perhaps spoke loudest of all. Not a single member of Congress from Arizona voted in favor of the bill, no Democrats, no Republicans. And if you ask some of the most conservative of the bunch -- and this is an oversimplification -- they will tell you that, basically, they don't see why the taxpayers should rush in and throw a mountain of money at a bunch of banks that blew themselves up.
REP. JEFF FLAKE (R), ARIZONA: Most people voting on that bill, particularly the ones that I was talking to, they felt that this was an issue that they had campaigned on. They had always said, we need to respect the free market. And to simply bail out with $700 billion in taxpayer money went completely against what they stood for.
JOHNS: Of course, this is an election year and a lot of members of Congress are on the endangered list. Many of them voted against the bailout.
FLAKE: Nobody can afford very long to completely ignore what your constituents are saying. But I can tell you that members of Congress, by and large, will look at a vote like this and say, you know, what platform was I elected on? What did I say when I was elected? What am I going to come here to do?
JOHNS: But was it the right thing to do given yesterday's dramatic plunge in the markets, the risk for jobs in the country? Even some rock-ribbed Arizona Republicans are wondering that tonight.
Ross Farnsworth is a conservative business man in the building industry from Mesa, Arizona. He's been laying people off.
ROSS FARNSWORTH, BUSINESSMAN: Many people through our corporations, and that hurts deeply, to have to lay people off that are trying to make their mortgage payments, feed their families and all this stuff. We have had to lay it off. In the housing and related industries, there's many, many, many laid off.
JOHNS: Farnsworth wanted the bill passed. He calls it a help- out, not a bailout, since the government was supposed to get its money back. And he suspects a lot of those who told Congress to vote against the bill really didn't understand it.
FARNSWORTH: I really don't. If they knew and were running a company and had to be laying off people, they might look at it a lot different.
(END VIDEOTAPE)
BROWN: So, Joe, what we know is that the Senate is going to vote tomorrow night, but the House is still a long way from getting there, aren't they?
JOHNS: Yes, they certainly are.
And when you talk to some of the people who really took down the bill, some of those conservative Republican congressmen who just didn't think it was the right idea, what they say you have got to have is some way to address the structural problems that created this.
And they're just not happy with the idea of, as I said, throwing a mountain of money at it, without figuring out a way to make sure it doesn't happen again. So, that is what they say they're focused on. And they sound like they're going to fight for it.
BROWN: All right, Joe Johns for us in Washington tonight -- Joe, thanks. What the presidential candidates said about the bailout today. We are going to put John McCain and Barack Obama to our no bias, no bull test when we come back.
And, then, later, both campaigns on the edge of their seats over the vice presidential debate. It is 48 hours away. Will the Palin/Biden debate be a game-changer?
(COMMERCIAL BREAK)
BROWN: Check it out. That's the latest CNN national poll of polls, showing Obama leading McCain by five points, 48 percent to 43 percent. That's a one-point gain for Obama compared to yesterday.
Barack Obama and John McCain both spoke to President Bush today. And during the campaign stops that followed, the candidates sounding remarkably similar, actually.
Our Tom Foreman is keeping track of what is happening on the campaign trail for us -- Tom.
TOM FOREMAN, CNN CORRESPONDENT: Well, Campbell, considering all this concern about the economy, it's fitting that John McCain held an economic roundtable with business leaders in Des Moines, Iowa, a state we now have as leaning Obama's way at the moment.
Obama, meanwhile, was over at the University of Nevada in Reno speaking to a crowd of about 10,000 people in that battleground state. And both candidates really seem to be refocusing on the financial crisis by dialing back the attacks on each other and intensifying their calls for action by Congress now -- Campbell.
BROWN: Let me stop you there, because both men may have been calling for action, but we do need to look at what they're saying about their own roles in trying to solve the crisis. Let's listen to that.
(BEGIN VIDEO CLIP)
SEN. JOHN MCCAIN (R-AZ), PRESIDENTIAL NOMINEE: Congressional inaction has put every American and the entire economy at the gravest risk.
Yesterday, the country and the world looked to Washington for leadership. And Congress, once again, came up empty-handed. I am disappointed at the lack of resolve and bipartisan goodwill among members of both parties to fix this problem. Bipartisanship is a tough thing, never more so when you're trying to take necessary, but publicly unpopular action. But inaction is not an option.
SEN. BARACK OBAMA (D-IL), PRESIDENTIAL NOMINEE: For the rest of the day, for the rest of today, and as long as it takes, I will continue to reach out to leaders in both parties, and do whatever I can to help secure the plan.
This morning, I talked to President Bush. I talked to Senator Harry Reid, the majority leader...
(CHEERING AND APPLAUSE)
OBAMA: Oh, yes, I forgot. He happens to come from Nevada.
(CHEERING AND APPLAUSE)
OBAMA: To the Democrats and Republicans who opposed this plan yesterday, I say, step up to the plate. Do what's right for this country.
(CHEERING AND APPLAUSE)
(END VIDEO CLIP)
BROWN: So what about it, Tom? Do their words pass the no bull test?
FOREMAN: Well, I guess it's a question about words vs. action, Campbell. Both candidates what their fellow lawmakers to rally around this effort to rescue the economy. The question is, are they really producing any results?
Let's start with McCain. Some Republicans are giving him props for suspending his campaign briefly last week and rushing back to D.C. to help broker a deal. They say that this did help focus Americans on the importance of the issue. Democrats, of course, called it a stunt.
But, as Joe Johns just reported, the entire congressional delegation from Arizona, his home state, voted against the bailout. That certainly raises questions about McCain's practical influence in this matter.
For Obama, same issue, different point of view. Yes, Republicans led the charge against this measure, but 95 Democrats -- that's 40 percent of their party in Congress -- also opposed the bailout. If Obama could have convinced just a dozen of those Democrats to change their votes, it would have passed.
Now, maybe a few Dems and a few Republicans got on board because of the candidates, but the bottom line remains, these two men both said they wanted this measure approved. They are both the titular heads of their party right now, and neither one of them convinced enough of the holdouts in his own party to get the job done.
Campbell, as you raised at the top, it raises very serious questions about their ability to lead anything on both sides if they can't lead their own people to help out on this issue.
BROWN: A very fair point from you, Tom.
Tom Foreman for us tonight, as always, thanks much.
Well, the stakes couldn't be much higher right now for the running mates. And still ahead, how Sarah Palin and Joe Biden are preparing for Thursday's debate. Also, can you really see Russia from an island in Alaska? Well, our Gary Tuchman traveled all the way up there to check if out. And it was a wild ride -- his story when we come back.
(COMMERCIAL BREAK)
BROWN: So we have been talking about leadership. Whether the presidential candidates are doing enough to push this bailout package through.
I'm back now with our panel: former Gingrich press secretary, Newt Gingrich press secretary, Tony Blankley, Politico's Eamon Javers, and Obama supporter Roland Martin, one of our own contributors.
Tony, let me start with you on this. On the trail today as we reported a moment ago, Barack Obama and John McCain saying, "It's time for bipartisanship, for leadership in Washington." Well, no kidding. Smart observation there.
They both say they're going to be there to vote in the Senate tomorrow. But shouldn't they be redoubling their efforts to twist arms, to whip up votes for a rescue bill on the House side?
TONY BLANKLEY, FORMER GINGRICH PRESS SECRETARY: Well, I would think that there would be in each of the candidates' interest to demonstrate constructively that they can provide leadership. One of them is going to become president.
I would have thought, for instance, there was a high number, I think, of Black Caucus votes were negative that Obama might make a personal, you know, pitch one-on-one in private to try to move them. And the same for McCain, he ought to be working the phones and trying to say, look, if I'm going to be president, I'm going to need this. I want you to support me. And part of it also is they should provide, I think, more persuasive public comments to provide sort of air cover, if you will, for their two sides.
BROWN: And, Roland, Tony has a point there. You know, Obama has stayed relatively safely on the sidelines. His aides admit he hasn't gotten involved in talking to individual House members, even though he said he supported the bill. I mean, considering he wants to be the one to inherit this mess, why not get in there and show some leadership?
ROLAND MARTIN, CNN POLITICAL ANALYST: Well, actually, Politico.com has a story on their site now that said he has made calls to particular House members. It also --
BROWN: But not before the vote, Roland. He didn't before the vote. Why not?
MARTIN: First of all, because one, he is not somebody who is part of the negotiation. He said clearly, allow those who are negotiating to do the negotiation and bring it to the members. But here's another problem, Campbell.
BROWN: Yes, but at that point he already thought there was a deal, Roland.
MARTIN: No.
BROWN: They had a prepared statement that the campaign wrote...
MARTIN: They all thought it was going to pass.
BROWN: ... congratulating them on a deal.
MARTIN: They all thought it was going to pass.
Here is the problem that they are facing and that is, you have specific members who have issues with the bill. Tony brought up Black Caucus members, Hispanic Caucus members. They have a problem. The Republicans are blocking efforts that will aid actual homeowners.
Like it or not, this is a bill that has some problems because people think is weighted too much on Wall Street and not those who are in small towns and inner cities. That's a reality.
BROWN: All right. Well, Eamon, let me to go you because John McCain has a very similar problem, frankly, to Obama.
EAMON JAVERS, POLITICO: Right.
BROWN: He was hoping to have this example to share with voters. You know, I'm the guy that can go fix Washington, that can broker this bipartisan deal and make it all happen. He suspends his campaign. He goes back to Washington to supposedly play a big role and look what happened. I mean, how much does that hurt him?
JAVERS: Well, the problem with trying to take credit for something is that when it doesn't happen, you're going to get part of the blame. And that's what's going to happen for John McCain here, I think, in voters' minds when he said he was going to Washington to fix this. It didn't get fixed.
Now, tomorrow, we're going to have an extremely dramatic moment if we get a vote in the Senate. We're going to have both John McCain and Barack Obama in the same room at the same time in the Senate floor casting a vote for this. That's a moment for a real bipartisan gesture of some kind, perhaps walking into the chamber together, or appearing together before the cameras making a joint statement in support of this thing, that would help push this thing over the top on the House side, perhaps. But this is also a very hard-fought campaign.
We'll see if these guys can bring themselves physically to work together in the middle of this campaign where they're each clawing and scraping for every percentage point going into November.
MARTIN: But, we're leaving some stuff out. We're leaving some stuff out.
Senate members are elected every six years. House members every two years. Every member of the House is up for re-election. However you vote will decide how constituents vote. And if you've got people in your district who are absolutely against this, I'm sorry, you got to be accountable to those members. McCain and Obama could call you all day...
BROWN: Right.
MARTIN: ... but you want to come back in January.
JAVERS: Campbell, one of the strategies we're going to be looking at is in the House Republicans if they're going to go after the retiring members, those folks who aren't facing re-election.
BROWN: Right.
JAVERS: And you try to get some of those "no" votes to come back and vote "yes" for the good of the party.
BLANKLEY: Let me just -- let me just --
BROWN: Quickly, Tony.
BLANKLEY: Let me just point out that most of the Black Caucus members do not have powerful Republican opposition in the general election.
MARTIN: But they have black constituents, Tony, who don't like the bill.
BLANKLEY: I understand. Both sides have constituents who don't like the bill, but there are a lot of safe seats on both sides of the aisle.
(CROSSTALK)
BROWN: Well, on that...
MARTIN: It's not going to fly.
BROWN: ... somebody is going to have to roll the dice and do this for noble reasons instead of their own political reasons. But we'll see if that actually happens.
OK, guys, we have to end it there. Tony, Eamon, Roland, many thanks to all of you.
Sarah Palin often talks about the Russian connection, how you can see Russia from one place in Alaska. So we sent Gary Tuchman to check it out.
(BEGIN VIDEO CLIP)
GARY TUCHMAN, CNN CORRESPONDENT: This is the city of Diomede, Alaska, on an island on this Little Diomede, about 25 miles off the western Alaska coast. This is basically a rock plopped to the Bering Sea. Only about 150 people live in the entire island. There are no hospitals, no hotels, no restaurants. And what's most unique about it is this -- this is the Bering Sea, the Bering Strait. A half mile in front of me is the international date line. And this rock in front of me, that is the nation of Russia.
(END VIDEO CLIP)
(COMMERCIAL BREAK)
BROWN: Still ahead, we're going to look at Thursday's VP debate, a close look at both running mates. But first, Randi Kaye with us for "The Briefing." -- Randi.
RANDI KAYE, CNN CORRESPONDENT: Hi there, Campbell. Sources tell CNN the top Taliban commander in Pakistan has died of kidney failure. Pakistan's government blamed Baitullah Mehsud for the killing of Benazir Bhutto. Mehsud once told an interviewer his goal was to attack New York and London.
They're voting for president in the crucial battleground state of Ohio. Yesterday, a court refused to let Republicans challenge a ruling that allows Ohioans to register and vote on the same day. Early voting is already underway in more than two dozen states.
And New York Mayor Michael Bloomberg reportedly plans to run for a third turn term if the billionaire mayor can change the city's term limit law. According to the "New York Times" and the "Associated Press," Bloomberg will argue the city needs a tested financial manager to get through this financial crisis.
BROWN: All right. Randi Kaye for us. Randi, thanks.
Joe Biden, Sarah Palin, have more important things to do right now than campaign. Some interesting -- an interesting look at how they are prepping for Thursday night's debate, when we come back.
(COMMERCIAL BREAK)
BROWN: Conventional wisdom has it that voters only care about the top of the ticket but that is certainly not the case this year. Sarah Palin and Joe Biden have gotten more attention than any running mates for a very long time, and their debate Thursday night could actually have more people watching than last week's McCain-Obama face- off.
Ed Henry has been handicapping the vice presidential debate for us.
Ed, start with Sarah Palin. Tell us how she's been prepping and what do you think her challenges are?
ED HENRY, CNN WHITE HOUSE CORRESPONDENT: Well, Campbell, you'll be happy to know that they had debate prep outside today, just like when you used to have class outside. Well, she had debate prep in Arizona near a creek by John McCain's ranch in Arizona. But it was not all about serenity and fun and games. She was sent out to Arizona because the McCain camp is a bit nervous. They almost sent her to kind of a boot camp to get her ready. She's had a couple of rough weeks, and she's got to get some clear things done.
First of all, she needs to show she's ready on day one. She has to not only show she has a grasp of the issues, which she didn't necessarily show in those Katie Couric interviews on CBS, but also that she's ready to be a heartbeat away from the presidency.
Second, she needs to show that she's cool under pressure. She's never faced a situation quite like this, one-on-one, millions of people, the hand to hand combat with Joe Biden. On the other hand, though, it has to be noted that she did face it in the convention. A lot of people were saying she wasn't ready for that kind of a stage. She knocked it out of the park.
And third, you know, let Palin be Palin. There's a debate going on within the Republican Party that maybe the McCain camp has kept her in a straitjacket, and instead of sort of overscripting her, they need to just let her be herself and that when she shows that direct, crisp style, she really connects with people, Campbell.
BROWN: All right. Ed, walk us through Joe Biden. He certainly has experience on stage in a long time. How is he gearing up? What are his challenges?
HENRY: He's been holdup in Sheridan in Delaware, and they basically converted a gymnasium into sort of a makeshift stage to get him ready. And today, he went to his favorite hamburger joint in Delaware. Sort of a little comfort food before the big night. Bottom line is, he has important things to accomplish, too.
First of all, the key is no gaffes. I mean, critics who didn't want him on the ticket said, look, this guy is a gaffe machine. He talks too much. So far, he has not made too many mistakes. A few but not high profile ones, if you will. But if he slips up here, the stage is so big, people are going to pounce and it's going to really blow up in his face.
Secondly, he needs to keep it simple. After being in the Senate for 36 years, you can start talking like a Washington insider. See Kerry, John. 2004 campaign where he talked about I voted for it before I voted against it. The good news for Biden and Democrats is so far on the stump, he has shown that he can connect with people. He goes into the small diners, talks to them one-on-one, so that might not be a problem for him.
Third, the condescension factor. The fact is it's a unique challenge for him as a man to debate a woman. A lot of other men have slipped up in this kind of debate. So he's been doing a lot of work. He's been consulting with female senators like Barbara Boxer, Hillary Clinton, trying to get some pointers. And also the key is, the person who's been the stand-in who's been playing Sarah Palin in his prep, Jennifer Granholm, the female governor of Michigan, a spicy woman herself. They're trying to get him ready for how you interact with a woman, mind your manners and make sure you don't slip up -- Campbell.
BROWN: All right. Ed Henry for us tonight. Ed, thanks.
HENRY: Thank you.
BROWN: So a lot of challenges here for both candidates. Breaking it down for us now, our panel.
James Carville, Democratic strategist, CNN political contributor; Republican strategist Bay Buchanan, also a CNN political contributor and former senior adviser to Mitt Romney's campaign, we should mention; and Michael Crowley, a senior editor for "The New Republic," here with me in the studio.
And guys, let's start with Sarah Palin. We'll go through that and then we'll do Joe Biden.
And James, let me start with you. You know, over the past couple of weeks, we've certainly seen Governor Palin struggle with questions on some pretty basic issues. The Wall Street bailout, the war on terror. We have seen the "Saturday Night Live" skits, heard the critics. How does she use this debate to prove them all wrong?
JAMES CARVILLE, DEMOCRATIC STRATEGIST: Well, first of all, generally, we have a lot of hype going in these debates, and you know, not much happens. Somebody tends to do a little better than all when we have to ask the polls and they have to poll (ph), et cetera, et cetera.
I actually think this is one of these instances where the debate may live up to the hype here. And she's got to show people, I mean, there's real doubt setting in that she's really not up to being president of the United States. I mean, very serious doubts. And she's got to put that fire out. And if she has a bad night, this thing will rage. It will be something that the McCain people will never be able to control. This is pretty high stakes this basically (ph) we're dealing with here Thursday night.
BROWN: Bay, to James' point, let me just read you a quote from David Frum, and he's a conservative, a former Bush speechwriter. He told "The New York Times," "I think she has pretty thoroughly and probably irretrievably-proven she is not up to the job of being president of the United States. If she doesn't perform well, then people see it. This is a moment of real high anxiety, a little bit like 9/11, when people look to Washington for comfort and leadership and want to know that people in charge know what they are doing."
I mean, this is coming, Bay, from a conservative and he is not alone in making this point. How does she demonstrate she's up to the job? BAY BUCHANAN, CNN POLITICAL CONTRIBUTOR: Well, I think, if, indeed, the McCain camp had done her fairly, and let her get out there and do a lot of radio, local TV, she would be very, very ready because she's a natural communicator, she's very, very talented. We've seen that time and again.
She didn't get to over 80 percent in popularity in Alaska as a governor by just not being known how to talk. She's been extremely effective at reaching people, bringing them to her point of view and leading a charge.
So I think the real question, there's a lot of pressure on her. But she can do it if she will just tell the handlers to bug off, get away, I'm taking care of this. I know exactly how to handle it. I've got all the information I need. Now, let me be Sarah and get out there and do what I know how to do best.
BROWN: And, Michael, to Bay's point, I've heard a lot of people say that. That they need to let her be heard. I mean, she certainly captured people's imagination in St. Paul. How does she do that again?
MICHAEL CROWLEY, "THE NEW REPUBLIC": I don't know that she can. I mean, I really don't think the issue is handling here. You know, as Bay says, she's got all the information she needs. Let her be her.
I don't know if she does have all the information she needs. The fundamental problem here is this woman just is not very well versed in the essential enormous issues facing the country right now, and it shows. And so, she can go on talk radio and field softball questions, isn't John McCain a maverick, oh, yes, he is. But when she's confronted with the details of policy with the massive issue like the economic bailout, she's just not ready.
And you can't do that crash course. It's like trying to prep for the bar in a weekend. You just can't do it.
BUCHANAN: Let me --
CROWLEY: So I just think -- I just don't have high hopes for her.
BROWN: Let me let Bay respond to that.
BUCHANAN: Yes. Let me ask all those years in Washington who back here knows what's going on with that bailout? I think she's as knowledgeable as anybody. And I'll tell you another thing, she understands how the American people are responding to that bailout. She's one of them.
The people back here in Washington take Joe Biden. He's been here all those years and what good has it done?
BROWN: All right. Hold that thought. OK, James --
CARVILLE: I would just -- I would like to ask Bay, maybe she can give us some illumination here. Senator McCain, as far the legislation as you refer to it as a bailout, do you know what Governor Palin's position is?
BUCHANAN: Yes. I know her first reaction was caught on television. She said, what, another bailout? That doesn't make her too happy. I don't know where she stands on this one, but I do know that instinctively -- and, James, that's what's key.
CARVILLE: Well, at the end of it, do you know her position on this?
(CROSSTALK)
BUCHANAN: She has -- I do know she has deeply-held conservative principles that she applies to policy...
CARVILLE: Right.
BUCHANAN: ... and that she would naturally be opposed to bailouts in general.
CROWLEY: She better have a more specific answer than that on Thursday night, I'll say.
BUCHANAN: I'm sure she will.
CARVILLE: Yes.
BUCHANAN: But I hope she expresses her own point of view...
BROWN: OK.
BUCHANAN: ... and understands that the American people were totally opposed.
BROWN: All right, guys. We got it. I have to get a quick break. We got a lot more to talk about. Stay with us. When we come back, I'm going to ask you about Joe Biden.
(COMMERCIAL BREAK)
BROWN: We're talking about Thursday's VP debate. Back with me now, three of the smartest people in politics, James Carville, Bay Buchanan, Michael Crowley.
And, James, let's talk about Joe Biden now. We did Sarah Palin. You know, there are a lot of people out there who say that Joe Biden, the best thing he can do on Thursday night is just say as little as possible. He is known on occasion to have foot-in-mouth disease, shall we say. How does he rein it in?
CARVILLE: Well, you know, I think he's pretty aware of that and people are prepping him. And he's pretty aware he can get a little wordy from time to time. But I think he'll be fine. He'll be fine.
BROWN: He's not worried. Michael, I mean, it's so interesting how both sides are playing the expectations game. And I was listening to some of the Obama/Biden people today and you would think in the way they describe it, that this was going to be a very even match-up. If anything, Biden could be in real trouble.
CROWLEY: Well, right, of course. But look, I think my advice for Joe Biden is basically ignore Sarah Palin. You want this debate to be pretty boring. The risk of going after her and failing is high because when a man confronts a woman too strongly in politics, it often backfires.
Just go after McCain. Lay out the differences. Don't make this a big dramatic debate. You don't want people talking too much about it. Let her burn herself down if that's what happens.
BROWN: Let me ask you about that, Bay. Because I've heard a lot of people say this about the male/female thing, which I sort of thought Hillary Clinton in the mix did a way with. But there are those who say that Biden has some challenges debating a woman that he wouldn't have if he were debating a man. That he has to be careful about talking down or sounding patronizing in any way, and he can't be overly aggressive. Do you agree?
BUCHANAN: I agree there's that concern. But I have to be honest, Senator Biden is a very charming man. I think it will come quite comfortably for him to have light banter with Governor Palin and enjoy the debate. I don't perceive that that's going to be a problem for him as much as saying something that makes news, because I guarantee you, the last thing they want is for Biden to be making news.
BROWN: How does he play this and be gracious, James?
CARVILLE: I completely agree. I think he's gracious by nature. I completely agree with Bay. Everybody knows him and may even like him. Agree or not, he's a very gracious, he's a nice guy. I don't -- I really don't expect him to come off anything of that.
He might talk a little bit. He might talk himself into a jam or two in here, but I think he's going to do fine. I think he's going to debate a lot of the progress and I think he'll be just fine.
BROWN: And guys, we got to end it there. There is enormous interest in this. There's going to be a huge audience on Thursday night.
Many thanks to James, Bay and Michael. Hope we can talk to you after the big debate.
When we come back, can you really see Russia from a small island in Alaska? Gary Tuchman is going to show us when we come back.
(COMMERCIAL BREAK)
BROWN: You'll recall how Governor Sarah Palin has said that you can see Russia from Alaska. Well, our Gary Tuchman went to see for himself. (BEGIN VIDEOTAPE)
GARY TUCHMAN, CNN CORRESPONDENT (voice-over): This is the island, a piece of Alaska that Governor Sarah Palin cites as evidence of her foreign policy experience. No streets, no cars, no airstrip. A helicopter is the only practical way to get here. Nome is the nearest city on the mainland. Anchorage, 550 miles away.
(on camera): This is the city of Diomede, Alaska, on an island on this Little Diomede, about 25 miles off the western Alaska coast. This is basically a rock plopped to the Bering Sea.
Only about 150 people live in the entire island. There are no hospitals, no hotels, no restaurants. And what's most unique about it is this -- this is the Bering Sea, the Bering Strait. A half mile in front of me is the international date line. And this rock in front of me, that is the nation of Russia.
Right now, it's Tuesday afternoon in the United States. There in Russia, it's Wednesday afternoon.
(voice-over): The smaller island in front is Little Diomede and then the division between Western and Eastern Hemispheres with Russia's Big Diomede island only 2 1/2 miles behind it. Since World War II, it's been a Soviet now Russian military installation. Twenty miles in the background, you can see the Russian/Siberian mainland.
UNIDENTIFIED FEMALE: You can pick the ones with all the checkmarks.
TUCHMAN: The 25 students in the Little Diomede school may be in the United States, but Russia dominates their view. And, yes, you can see it from every house. Is Big Diomede in the United States of America? Where is it?
UNIDENTIFIED GIRL: Russia.
TUCHMAN: Governor Palin may be talking about this island, but she has never been here.
Patrick Omiak (ph) is the tribal chief of the native Alaskan community on Little Diomede.
TUCHMAN: Since Alaska has been a state, which is almost 50 years next year, have you had a governor come visit here?
UNIDENTIFIED MALE: No.
TUCHMAN: The only statewide politician ever to come here is current U.S. Senator Ted Stevens. So regarding Sarah Palin --
ERIC IYAPANA, LITTLE DIOMEDE RESIDENT: She's making a comment that she shouldn't have made in the first place -- about seeing Russia. She should have came out here beforehand then made the comment. TUCHMAN: While some here feel Sarah Palin is doing a good job as Alaska governor, others are nowhere near getting swept up in her new national fame.
What's the governor's name?
THELMA AHKVALUK, LITTLE DIOMEDE RESIDENT: Sarah Palin.
TUCHMAN: There is no television on Little Diomede Island, so many here don't keep up with the news.
Do you know that she was picked by John McCain as running for president to be the vice president of the United States possibly?
UNIDENTIFIED MALE: No, I did not know that.
TUCHMAN: Diomede mayor, Andrew Milligrock, does know of her but does not believe that Russia's proximity to Alaska provides foreign policy experience.
(on camera): Has this governor, Palin, or any other Alaskan governor ever said to the mayor of this city, we need to work hand in hand dealing with the Russians if it a, happens or if b, happens?
MAYOR ANDREW MILLIGROCK, LITTLE DIOMEDE, ALASKA: No, no.
TUCHMAN: Never have?
MILLIGROCK: No.
TUCHMAN: No discussions with the state capital about that?
MILLIGROCK: No.
TUCHMAN (voice-over): In fact, nobody we talked with here feels threatened with Russia being about the same distance from them as the White House is from the U.S. Capitol. The native Alaskans here are a proud people, but the poverty rate is above 40 percent. There's little running water and occasionally residents dump their garbage into the sea. And depending on the currents --
ROGER KUNAYAK, SR., LITTLE DIOMEDE RESIDENT: It's going down to the Russian side.
TUCHMAN: It's going to the Russian side.
KUNAYAK: Russian side, yes.
TUCHMAN: So far, no international incidents.
(END VIDEOTAPE)
TUCHMAN: I just talked a short time ago with one of the Palin campaign's spokespeople. Meghan Stapleton tells me in answer to the question, what kind of foreign policy experience does she have? She says she has at least as much foreign policy experience as other governors who wish would become president or vice president of the United States -- Campbell.
BROWN: All right. Gary Tuchman for us. That's it, everybody.
"LARRY KING LIVE" starts right now.
