Return to Transcripts main page


Pre-Speech Analysis; President Obama Holds Press Conference from the East Room; Post-Speech Analysis

Aired September 10, 2010 - 10:45   ET



And good morning, everyone. Welcome to our special coverage. A live picture of the White House there, where in about 15 minutes the president of the United States will have what is a rare event at the Obama White House, a full-blown press conference in the East Room.

We are just over seven weeks from a big midterm election. The president has been trying this week to get his message on the economy out, to try to help Democrat candidates turn the tide in this campaign. Of course, we also expect him also to be questioned about other breaking news developments. Iran saying it will free one of those hikers. There is the Koran burning controversy down in Florida, and so many other issues.

We should also tell you, we may have to interrupt to go to a live event in California. A gas pipeline explosion overnight in San Bruno. Officials there expected to brief soon, as well. So, we're tracking these two live events.

As we do so, let's take a peek inside the East Room of the White House, where the president of the United States will speak in a few moments. Until he speaks, let's talk over the stakes of what we expect to hear from the president and why it matters so much in this midterm election campaign.

Joining us for our special political coverage, our senior political correspondent, Candy Crowley. And Candy, a rare event for this president. Many people would say why 11:00 on a Friday morning?

CANDY CROWLEY, CNN CHIEF POLITICAL CORRESPONDENT: Well, because the time's available. And because, any moment he can use at this point to try to move voters to the polls. Because that's where we are. I don't think you can move voters on the actual policies. What you have to do is go find your voters and get them to come to the polls. So, he has to do that.

It seems to me that the White House and Democrats in general have moved from sort of search-and-rescue to recovery. What they are trying to do is trying to mitigate their losses coming up, and I think this is part of that.

KING: That's great way to put it.

Let's go inside the East Room. Our senior White House correspondent, Ed Henry, is standing by. Ed, I spent eight years covering that building. This is always an interesting moment if you're a White House correspondent. Number one, trying to figure out what you'll ask the president and number two, tell us what your reporting tells you about why this and why now?

ED HENRY, CNN SENIOR WHITE HOUSE CORRESPONDENT: Well, they know this is an important moment right now. It's about 20 months since he took office with so much hope and history. Now, it's sort of a difficult moment. Some of his own supporters angry, feeling like maybe he squandered some opportunities, and he may be on the verge, as you noted, of losing control of both chambers of Congress in just under two months. So, there's a lot on the domestic front, largely because of those economic anxieties that have put so many Democrats on the ropes this midterm election season.

But we can't forget as well he is a commander-in-chief still executing two wars right now. That could certainly be a lot of the questions on the plate today. Even though combat operations have been declared over in Iraq, we still have 50,000 U.S. troops on the ground there, and now he has over 100,000 U.S. troops on the ground in Afghanistan. This president has been executing a surge of his own there in Afghanistan, and by all accounts, even by the military commanders, it's not exactly going well right now. This administration is going to have a major review of Afghan policy coming out at the end of this year in December. So, that's also on the agenda.

And as you noted, there's a lot of other issues out there, like the potential Koran burning and a lot that could be asked because bottom line is, the last time he had a full-blown news conference like this here at the White House was back in late May when he was dealing with the oil spill. That has largely passed now, but he's dealing with all kinds of other crisis since, John.

KING: Ed Henry, inside the East Room. We'll check back with him

And Candy, you know this because you spent a lot of time in the building as well. Ed's getting ready, waiting for the president. They're all trying to figure out who's going to get called on first. That usually happens according to tradition. But then you figure out, "Am I going to third? What question would I ask? If I'm fifth, what question am I going to ask?"


KING: The drama.

CROWLEY: "If I'm fifth and he's left something open, do I ask that question instead of what I have in mind?"

I want to bring in our senior political analyst, David Gergen. David, you have seen the other side of this equation. We have seen the reporter's side. First of all, is this a crisis news conference, being called much like the oil spill. Or is this just time to kind of get his economic plan out there once again? How do you see this? DAVID GERGEN, CNN SENIOR POLITICAL ANALYST: Candy, much the latter. It was planned a few days ago, and clearly, it was supposed to be the capstone for the rollout of these new stimulus packages, these various tax packages that the president's putting forward this week.

And I think the unfortunate position the White House find itself in is that the proposals themselves, of course, got mixed reviews even from Democrats. The business community was somewhat tepid; the White House is frustrated over that. They want to use this news conference to reach a bigger public.

But their other problem is that so many people have been tuning the president out. If you look at the numbers of Americans who watched his first primetime address to the country, 52 million people tuned in for that. When he gave the Iraq address just a few days ago, 29 million.

CROWLEY: And once again, John, David brings up a good point. We always have talked all along with President Obama that his problem isn't the Republicans who are going to oppose what he puts out there. It's the Democrats.

KING: The president always has many different audiences when he speaks to the American people. In this case, the president of the United States speaks for the world.

But probably his most important audience is a Democratic party and Democratic candidates that have a mild if not severe case of jitters on whether to run on this president's agenda or not.

Dana Bash, our senior congressional correspondent, is on Capitol Hill. And Dana, if the Democratic candidates are watching the president, and, of course, they will be, what are they looking for most and what are they worried about most?

DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT: At this point, what they are worried about most is what you all were talking about, their Democratic base.

I was talking to a strategist this morning who told me an interesting number from internal Democratic polls, and that is they are seeing a 10 percent to 15 percent drop-off of Obama voters to those who want to get out in this election cycle. That's terrible for all of the candidates. And there are many of them in neck-and-neck races, and terrible big picture for the Democrats who want to keep control of the building behind me.

That's why they are hoping he continues broadly on the message and more specifically with the energy in the big speeches this week, talking about the Democratic case on the economy. But even more importantly, the Democrats I've talked to say to lay out the contrast with Republicans.

One other funny conversation I had with the Democratic strategist this morning on that point is they really hope he does his best to stay on the message and doesn't have, in the words of one source, "a Henry Louis Gates moment" in that he answers a reporter's question and that takes the lead and makes the headline in this press conference as opposed to what they really need, which is the economy.

KING: And as we wait for that report. Dana Bash, thanks for that reporting.

I think, Candy, a key point in that reporting is that the Democrats are out there -- some Democrats are running from the president and some are willing to stand with the president. But the president has decided in recent days, because of that drop-off, to try to get his voters, Obama voters, who aren't necessarily Democratic voter, to come out and get involved in this election. He's personalizing it. He's saying, "I need you. This is about me. Don't give up your hope, don't give up on me."

CROWLEY: Because as unpopular as the president's policies are at this point, at least according to the polling, he still retains some personal popularity. There are people who really like the guy, they're just not necessarily crazy about where he is going. We want to bring in some of our other contributors and other senior political analysts. Gloria Borger.

Gloria, let me start with you. How does he get -- he wasn't able to get them to the polls in New Jersey. He wasn't able to get them to the polls in Virginia. . He wasn't able to get them to the polls in Massachusetts. How is the president going to convince people do this one for me again?



BORGER: Please come out and vote. It's interesting because I think the White House is trying to do two different things. On the one hand, you talk to political strategists, and they say these are hand-to-hand combat races, these are local races in the House, they're going to revolve around local issues. It's not going to be a referendum on Barack Obama. On the other hand, what are they doing? They are turning it into a referendum on Barack Obama. And because they probably believe he is the only one who can get these people out to vote.

He has to give them a reason, Candy. He has to give them a message. We were out in Ohio, and we interviewed Democratic voters. Democratic voters, you ask them what's the message of this midterm election from the Democrats? And they had no idea.

So, what the president is going to do is try and use this tax cut issue as a message and say, we want to make the tax cuts for the middle class permanent, and the Republicans are going to try to hold that hostage because they don't want to raise taxes on the wealthy. That's kind of the last-ditch effort to try and get voters out.

KING: How do you do that, Donna? How do you do it in a sense when off wave election in your favor, people are running out to vote, the only thing you need to tell them where to go and when to go. When they don't want to come - seven weeks. Democrats don't have enough time to change the strategic arc of the election, which is a sour economy? People are mad.

But seven weeks is a lot of time to do nuts and bolts. How do you grab people by the ear and say, "You might not care, but you need to vote?"

DONNA BRAZILE, CNN CONTRIBUTOR: You know, I think President Obama has enough juice, enough personal appeal to really rally his base to the polls this.

We all know what the polls are saying. These are generic polls. We are not talking about candidate X and candidate Y. We are talking about where the momentum might be right now. But I think in the long run, Democrats will come out because all that the president needs to do is remind them we are not going back to the past Bush policies.

KING: I'm sorry, I need to interrupt you. There's also another breaking news event, a briefing out in San Bruno, California. There was a deadly gas explosion overnight. Officials from the California emergency agencies are briefing right now. Let's go there and listen for a little bit while we wait for the president.


KING: You have watching there live coverage. That's the lieutenant governor of California. He just gave an update on the horrific gas explosion overnight fire in English. He's now giving it in Spanish as well in California.

We will continue to track developments in that tragic event out in California. But we are just now about two minutes away from a press conference by the president of the United States here in Washington D.C. in the East Room.

The president will name a new top economic adviser. He will try to convince the American people that, yes, times are tough but his economic plan - he will make the case - is working and will work. He's trying to shift the mood in a midterm election climate.

Back to our contributors here. Eric Erikson, editor-in-chief of the conservative You are not a fan of this president, obviously. Let me ask you, if you were in that room and could have one question of the president of United States, what would it be?

ERIC ERIKSON, EDITOR-IN-CHIEF, REDSTATE.COM: Oh, I would probably ask him about the Koran burning to throw him off message.

You know, why do you do this on Friday at 11:00 when every senior citizen in America is going to be upset they're missing The Price is Right because of the president? I mean, this is to set the narrative for the weekend so that journalists on Sunday, on the talk shows, are talking about him keeping the momentum from Tuesday so that he can start changing the psychology of the Democrats who think they're going to get wiped out. We all know the polls are going to contract. It's going to narrow, and so we can say the president is having some momentum.

BORGER: But to be fair, he had scheduled this earlier, in the week before the Koran controversy.

ERICKSON: That's true, but, I mean, it was pretty obvious, I think, by the time he scheduled it on Tuesday that this story was blowing up along with several others. But on Friday at 11:00 a.m., the president doesn't speak to the people, he's speaking to the base and to us.

KING: Well, I think a key point of this president, a key goal, is to speak to the base. He's also, you're right, trying to drive the conversation into the weekend.

We're inside the two-minute warning. We're about a minute away from the president of the United States.

He is an extraordinary communicator, and yet, as president, many Democrats have said what happened to the guy who was out on the campaign trail?

CROWLEY: Well, exactly. And it brings me back to something Donna said earlier, which is she thinks he has the juice to bring people out to the polls.

But does he? Because, I mean, I remember him up in New Jersey, in the governor's race up there, saying, you know, do this one for me, come out for me like you did in 2008. He did the same thing in Virginia. Republicans won those.

So these are different. If he can frame it as a big, big election for him and for his agenda, perhaps. But it's a tough go, I think.

BORGER: You've got to define the stakes for the people, for his voters to get out there and vote. And that's something he hasn't done yet, and that's what he's trying to do today.

BRAZILE: And remember, Congress returns next week. And the other thing that the president wants to do is to help set the agenda for the closing weeks of this session of Congress.

KING: And you see now the great pageantry inside the East Room of the White House. You see White House correspondents up giving their last word, starting to take their seats.

The president of the United States on a Friday morning in the East Room.


Before I take your questions, I just want to talk a little bit about our continuing efforts to dig ourselves out of this recession and to grow our economy. As I said in Cleveland on Wednesday, I ran for president because I believed the policies of the previous decade had left our economy weaker and our middle class struggling. There were policies that cut taxes, especially for millionaires and billionaires, and cut regulations for corporations and for special interests, and left everyone else pretty much fending for themselves. There were policies that ultimately culminated in a financial crisis and a terrible recession that we're still digging out of today.

We came into office with a different view about how our economy should work.

Instead of tax cuts for millionaires, we believe in cutting taxes for middle-class families and small-business owners. We've done that.

Instead of letting corporations play by their own rules, we believe in making sure that businesses treat workers well and consumers friendly and play by the same rules as everyone else.

So we put in place common-sense rules that accomplish that.

Instead of tax breaks that encourage corporations to create jobs overseas, we believe in tax breaks for companies that create jobs right here in the United States of America. And so we've begun to do that.

We believe in investments that will make America more competitive in the global economy: investments in education and clean energy, in research and technology. And we're making those investments.

So these are the principles that have guided us over the last 19 months. And these are the principles that form the basis of the additional economic proposals that I offered this week.

Because even though the economy is growing again and we've added more than 750,000 private sector jobs this year, the hole the recession left was huge and progress has been painfully slow. Millions of Americans are still looking for work. Millions of families are struggling to pay their bills or the mortgage.

And so these proposals are meant to both accelerate job growth in the short term and strengthen the economy in the long run.

These proposals include a more generous permanent extension of the tax credit that goes to companies for all the research and innovation that they do here in America. And I've proposed that all American businesses should be allowed to write off all the investments they do in 2011.

This will help small businesses upgrade their plants and equipment, and it will encourage large corporations to get off the sidelines and start putting their profits to work in our economy.

We also announced a six-year plan to rebuild America's roads and railways and runways. Already, our investments in infrastructure are putting folks in the construction industry back to work. And this plan would put thousands more back to work, and would help us remain competitive with countries in Europe and Asia that have already invested heavily in projects like high-speed railroads.

But one thing we can do next week is end a month-long standoff on a small-business jobs bill that's been held up in the Senate by a partisan minority.

I realize there are plenty of issues in Washington where people of good faith simply disagree on principle. This should not and is not one of those issues.

This is a bill that does two main things. It gives small- business owners tax cuts and it helps them get loans, and will eliminate capital gains taxes for key investments in 1 million small businesses. It will provide incentives to invest and create jobs for 4 million small business. It will more than double the amount some small-business owners can borrow to grow their companies.

It's a bill that's paid for, a bill that won't add to the deficit. It has been written by Democrats and Republicans. It's a bill that's been praised by the Chamber of Commerce.

And yet a minority of Republican senators have been using legislative tactics to prevent the bill from even getting to a vote.

Now, I was pleased to see that yesterday Republican Senator George Voinovich of Ohio said he would refuse to support this blockade any longer.

Senator Voinovich said, "This country is really hurting and we don't have time anymore to play games." I could not agree more.

I understand there's an election coming up, but the American people didn't send us here to think about our jobs. They sent us here to think about theirs. And there are small businesses right now who are putting off plans to hire more workers because this bill is stalled.

That's not the kind of leadership this country deserves. And I hope we can now move forward to get small-business owners the relief they need to start hiring and growing again.

While we're on the subject of economics, I also want to make an announcement about my economic team.

This week, Christina Romer returned to Berkeley after a tireless, outstanding tenure as chair of the Council of Economic Advisers. Christie is brilliant. She is dedicated, and she was part of the team that helped save this country from a depression.

So we're going to miss her dearly. But today, I'm happy to announce Austan Goolsbee as her replacement.

Austan's been one of my good friends and close economic advisers for many years. He's one of the finest economists in the country and he's worked as a member of the Council of Economic Advisers since we arrived here in Washington.

He's not just a brilliant economist. He's someone who has a deep appreciation of how the economy affects everyday people and he talks about it in a way that's easily understood.

He already knows and works with the rest of the team very well. I have complete confidence he's going to do an outstanding job as CEA chair.

And finally, tomorrow we will commemorate not only the heartbreak of September 11th, but also the enduring values and resilient spirit of America.

Both Michelle and I will be joining our fellow citizens in remembering those who were lost on that day and honoring all who exhibited such extraordinary heroism in the midst of tragedy.

I'll have further remarks tomorrow, but for now let me just note that tomorrow is a national day of service and remembrance, and I hope each of us finds a way to serve our fellow citizens; not only to reaffirm our deepest value as Americans, but to rekindle that spirit of unity and common purpose that we felt in the days that followed that September morning.

And, now, I'd be happy to take some questions, and I'm going to start with Darlene Superville of AP.

QUESTION: Thank you, Mr. President.

You said this week that Democrats wouldn't do well in the November elections if it turns out to be a referendum on the economy. But with millions of people out of work and millions of people losing their homes, how could it not be a referendum on the economy and your handling of it, and why would you not welcome that?

OBAMA: Well, the -- what I said was that if it was just a referendum on whether we've made the kind of progress that we need to, then people around the country would say, "We're not there yet."

If the election is about the policies that are going to move us forward versus the policies that will get us back into a mess, then I think the Democrats will do very well. And here's why.

As I just indicated, middle-class families had been struggling for a decade before I came into office. Their wages and incomes had flatlined, they were seeing the costs of everything from health care to sending their kids to college going up, job growth was the weakest of any economic expansion between 2001 and 2008 since World War II. The pace was slower than it's been over the last year.

So these policies of cutting taxes for the wealthiest Americans, of stripping away regulations that protect consumers, running up a record surplus to a record deficit -- those policies finally culminated in the worst financial crisis we've had since the Great Depression. And for 19 months, what we have done is steadily worked to avoid a depression, to take an economy that was contracting rapidly and start making it grow again, a situation where we were losing 750,000 jobs a month and now we have had eight consecutive months of private- sector job growth, and made investments that are going to strengthen the economy over the long term.

But we're not there yet. I mean, we -- we lost 4 million jobs in the six months before I was sworn in. And we lost 8 million jobs total during the course of this recession.

That is a huge hole to dig ourselves out of. And people who have lost their jobs around the country and can't find one, moms who are sending out resumes and not getting calls back, worried about losing homes, not being able to pay bills, you know, they're not feeling good right now.

And I understand that. And I ran precisely because I did not think middle-class families in this country were getting a fair shake. And I ran because I felt that we had to have a different economic philosophy in order to grow that middle class and grow our economy over the long term.

Now, for all the progress we've made, we're not there yet.

And that means the people are frustrated, and that means people are angry.

And since I'm the president and Democrats have controlled the House and the Senate, it's understandable that people are saying, you know, "What have you done?"

But between now and November, what I'm going to remind the American people of is that the policies that we have put in place have moved us in the right direction. And the policies that the Republicans are offering right now are the exact policies that got us into this mess.

It's not a situation where they went and reflected and said to themselves, "You know what? We didn't do some things right. And so we've got a whole bunch of new ideas out here that we want to present to you that -- that we think are going to help put us on the path of strong growth."

That's not what happens.

The chairman of their committee has said, "We would do the exact same things as we did before Obama took office."

Well, we know where that led.

And -- and a perfect example is the debate we're having on taxes right now.

I have said that middle-class families need tax relief right now. And I'm prepared to work on a bill and sign a bill this month that would ensure that middle-class families get tax relief. Ninety-seven percent of Americans make less than $250,000 a year -- $250,000 a year or less. And I'm saying, we can give those families, 97 percent, permanent tax relief.

And by the way, for those who make more than $250,000, they'd still get tax relief on the first $250,000, they just wouldn't get it for income above that.

Now, that seems like a common-sense thing to do. And what I've got is the Republicans holding middle-class tax relief hostage because they're insisting we've got to give tax relief to millionaires and billionaires to the tune of about $100,000 per millionaire, which would cost, over the course of 10 years, $700 billion -- and that economists say is probably the worst way to stimulate the economy.

OBAMA: That doesn't make sense. And that's an example of what this election is all about.

If -- if you want the same kinds of skewed policies that led us to this crisis, then the Republicans are ready to offer that. But if you want policies that are moving us out, even though you may be frustrated, even though change isn't happening as fast as you'd like, then I think Democrats are going to do fine in November.


QUESTION: Thank you, Mr. President.

You're looking for Republican help on the economic proposals that you unveiled this week, and you also mentioned the small-business bill, but you're at odds with them over tax cuts. Is there room for a middle ground whereby, for example, the tax cuts on the wealthy could be extended for a period of time and then allowed to expire?

OBAMA: Well, certainly there's going to be room for discussion.

My hope is is that on this small-business bill that is before the Senate right now that we actually make some progress. I still don't understand why we didn't pass that two months ago. As I said, this was written by Democrats and Republicans. This is a bill that traditionally you'd probably get 90 percent or 100 percent Republican support, but we've been playing politics for the last several months.

And if the Republican leadership is prepared to get serious about doing something for families that are hurting out there, I would love to talk to them.

Now, on the high-income tax cuts, my position is let's get done what we all agree on.

What they've said is they agree that the middle-class tax cuts should be made permanent. Let's work on that. Let's do it.

We can have a further conversation about how they want to spend an additional $700 billion to give an average of $100,000 to millionaires. That I think is a bad idea. If you were going to spend that money, there are a lot better ways of spending it. But, more to the point, these are the same folks who say that they're concerned about the deficits; why would we borrow money on policies that won't help the economy and help people who don't need help?

But, setting that side, we've got an area of agreement, which is let's help families out there who are having a tough time. We -- as I said, we could, this month, give every American certainty and tax relief, up to $250,000 a year. Every single American would benefit from that.

Now, people who make $250,000 a year or less, they'd benefit on all their income. People who make a million dollars would benefit on a quarter of their income.

But the point is is that that's something that we can all agree to. Why hold it up? Why hold the middle class hostage in order to do something that most economists don't think makes sense.

QUESTION: So are you looking at a deal with Republicans on tax cuts for the wealthiest?

What I'm saying is let's do what we agree to and that the Americans (sic) people overwhelmingly agree to, which is let's give certainty to families out there that are having a tough time.

Chip Reid?

QUESTION: Thank you, Mr. President.

On the economic package that you rolled out earlier this week, first on the business tax cuts, why did you wait until this super- heated campaign season to roll it out?

A lot of your critics, and even some Democrats, say, "Well, clearly, he's just using this for political purposes, he doesn't have any expectation it's actually going to be passed. It's a political weapon." Why did you wait so long to bring that out?

And on the stimulus part, we can't get people in the White House to say it is a stimulus. $50 billion for roads and other infrastructure, but they avoid the word "stimulus" like the plague. Is that because the original stimulus is so deeply unpopular? And if so, why is it so unpopular?

OBAMA: Well, let me -- let me go back to when I first came into office, we had an immediate task, which was to rescue an economy that was tipping over a cliff. And we put in place an economic plan that 95 percent of economists say substantially helped us avoid a depression.

A third of those were tax cuts, by the way. A third of that economic plan was tax cuts for individuals and for small businesses.

So we haven't -- this notion that we waited until now to put forward a series of plans, Chip, we've -- just on the small-business issue alone, we have cut taxes for small businesses eight times during the course of the last 18 months. So we're hardly Johnny-come-latelys on this issue.

Now, when you put all the things we've done together, it has made a difference. Three million people have jobs that wouldn't have them otherwise had we not taken these steps. The economy would be in much worse shape.

But, as I said before, we're not where we need to go yet, which means that if we're not there yet, what else can we do?

And the proposals that we put forward are ones that historically, again, have garnered bipartisan support: a research-and-development tax credit so that companies that are investing in research here in the United States, which is part of what's going to keep us growing and keep us innovative.

Let's make sure that, you know, companies are strongly incentivized to do that.

Making sure that their expensing -- accelerated business depreciation is happening in 2011, so that if companies are, sort of, sitting on the sidelines right now, not sure whether they should invest, let's give them incentive to go ahead and invest now to give that a jump-start.

On infrastructure, we've got a highway bill that traditionally is done every six years, and what we're saying is let's ramp up what we're doing; let's beef it up a little bit, because we've got this infrastructure all across the country that everybody from governors to mayors to economists to engineers of all political stripes have said is holding us back in terms of our long-term competitiveness. Let's get started now rebuilding America.

And in terms of paying for some of these things, let's stop giving tax breaks to companies that are shipping jobs overseas. Let's stop incentivizing that. Let's give tax breaks that are investing right here in the United States of America.

Those are all common-sense approaches. Historically, as you know -- you've been around this town for a long time -- usually Republicans and Democrats agree on infrastructure. Usually Republicans and Democrats agree on making sure that research-and-development investments are made right here in the United States. And so let's get it done.

It has nothing to do with the notion that somehow what we did previously didn't work. It worked. It just hasn't done as much as we needed to do. We've still got a long ways to go and we're going to keep on doing it.

QUESTION: So this is a second stimulus?


OBAMA: You know, the -- here's how I would -- there is no doubt that everything we've been trying to do -- everything we've been trying to do is designed to stimulate growth and additional jobs in the economy. That's our entire agenda.

So -- so I have no problem with people saying, "The president is trying to stimulate growth and hiring." Isn't that what I should be doing? I would assume that's what Republicans think we should do: to stimulate growth and jobs.

And I will keep on trying to stimulate growth and jobs for as long as I'm president of the United States.

QUESTION: (inaudible) my real question.

It's now been more than two months since the national regulatory reform bill has passed. A centerpiece of that was what you talked about is Consumer Financial Protection Bureau, and yet you haven't named the head.

Is Elizabeth Warren still a leading candidate? And, if not, are you worried about some sort of Senate hurdle for her confirmation?

Thank you.

OBAMA: This is a great opportunity to talk to the American people about what I do think is going to be hugely helpful to middle- class families in the years and decades to come, and that is a -- an agency that has been set up -- an independent agency -- whose sole job is to protect families in their financial transactions.

So if you are getting a credit card, we are going to have an agency that makes sure that that credit card can't jack up your rates without any reason, including on old balances. And that could save American consumers tens of billions of dollars just in the first couple of years.

If you are out there looking for a mortgage -- and we all know that part of the problem with the financial crisis was that folks were peddling mortgages that were unstable, that had these huge balloon payments, that people didn't fully understand.

Well, now there's going to be some oversight in terms of how mortgages are shaped, and people are going to actually have to know what they're getting, what they're buying into. That's going to affect the economy as well as individual consumers.

So this agency I think has the capacity to really provide middle- class families the kind of protection that's been lacking for too long.

Now, the idea for this agency was Elizabeth Warren's. She's a dear friend of mine. She's somebody I've known since I was in law school. And, you know, I have been in conversations with her. She is a tremendous advocate for this idea.

It's only been a couple of months, and this is a big task, standing up this entire agency. So I'll have an announcement soon about how we're going to move forward. And, you know, I think what's fair to say is, is that I have had conversations with Elizabeth over the course of these -- over these last couple of months, but I'm not going to make an official announcement until -- until it's ready.

QUESTION: Are you unofficially concerned about a Senate confirmation?

OBAMA: You know, I'm concerned about all Senate confirmations these days. I mean, if I nominate somebody --


OBAMA: -- for dog catcher --

QUESTION: But with respect to Elizabeth Warren, are you?

OBAMA: I wasn't trying to be funny. I am concerned about all Senate nominations these days.

I've got people who've been waiting for six months to get confirmed who nobody has an official objection to and who were voted out of committee unanimously, and I can't get a vote on them.

We've got judges who are pending. We've got people who are waiting to help us on critical issues like homeland security.

And it's very hard when you've got a determined minority in the Senate that insists on a 60-vote filibuster on every single person that we're trying to confirm, even if after we break the filibuster it turns out that they get 90 votes.

They're just playing games. And as, I think, Senator Voinovich said very well, it's time to stop playing games.

All right.

QUESTION: Given the theme, I think, of all of your answers, I just got a short question for you: How have you changed Washington?

OBAMA: Well, I'll tell you how we've changed Washington.

Prior to us getting here, as I indicated before, you had a set of policies that were skewed toward special interests, skewed toward the most powerful, and ordinary families out there were being left behind.

And since we've gotten here, whether it's making sure that folks who can't get health insurance because of pre-existing condition can now get health insurance, or children who didn't have coverage now have coverage; whether it's making sure that credit card companies have to actually post in understandable ways what your credit card rates are, and they can't jack up existing balances in arbitrary ways; whether it's making sure that we've got clean water and clean air for future generations; whether it's making sure that tax cuts go to families that need it, as opposed to folks who don't -- on a whole range of issues over the last 18 month, we've put in place policies that are going to help grow a middle class and lay the foundation for long-term economic growth.

Now, if you're asking why haven't I been able to create a greater spirit of cooperation in Washington, I think that's fair. I'm as frustrated as anybody by it.

I think part of it has to do with the fact that when we came into office, we came in under very tough economic circumstances. And I think that some of the Republican leaders made a decision, you know, "We're going to sit on the sidelines and let the Democrats try to solve it." And so we got a lot of resistance very early.

I think what's also true is, is that when you take on tough issues, like health care or financial regulatory reform, where special interests are deeply entrenched, there's a lot of money at stake for them, and where the issues are so complicated that it drags on for a long time, you end up having a lot of big fights here in town, and it's messy, and it's frustrating.

And, well, the -- and so, you know, there is no doubt that an option that was available to me when I came in was not to take on those issues.

I mean, we could have decided, you know what? Even though we know that -- that the pace of accelerating health care costs is going to bankrupt this economy and bankrupt businesses and bankrupt individuals, and even though we know that there are 30 million people, and that's a growing number of people who don't have health insurance, we could have said, "You know what? That's just too controversial. Let's not take it on."

And we could have said with respect to financial regulatory reform, "You know what? We're just going to get too much resistance from Republicans. We shouldn't take that on."

I don't think that's the kind of leadership that the American people would want from their president.

And, you know, are there, you know, things that I might have done during the course of 18 months that would, you know, at the margins have improved some of the tone in Washington? Probably.

Is some of this just a core difference in approach, in terms of how we move this country forward, between Democrats and Republicans? I'd say the answer is -- is a lot more the latter.

QUESTION: Thank you, Mr. President.

Nine years after the September 11th attacks, why do you think it is that we are now seeing such an increase in suspicion and outright resentment of Islam, especially given that it has been one of your priorities to increase -- to improve relations with the Muslim world?

OBAMA: You know, I think that at a time when the country is anxious generally and going through a tough time, then, you know, fears can surface -- suspicions, divisions can surface in a society. And so I think that plays a role in it. One of the things that I most admired about President Bush was, after 9/11, him being crystal clear about the fact that we were not at war with Islam. We were at war with terrorists and murderers who had perverted Islam, had stolen its banner to carry out their outrageous acts.

And I was so proud of the country rallying around that idea, that notion: that we are not going to be divided by religion. We're not going to be divided by ethnicity. We are all Americans. We stand together against those who would try to do us harm.

And that's what we've done over the last nine years. And we should take great pride in that.

And I think it is absolutely important now for the overwhelming majority of the American people to hang onto that thing that is best in us: a belief in religious tolerance; clarity about who our enemies are. Our enemies are Al Qaeda and their allies who are trying to kill us, but have been -- have killed more Muslims than just about anybody on Earth.

You know, we have to make sure that we don't start turning on each other. And I will do everything that I can as long as I'm president of the United States to remind the American people that we are one nation, under God. And we may call that God different names, but we remain one nation.

And, you know, as -- as somebody who, you know, relies heavily on my Christian faith in -- in my job, I understand, you know, the passions that religious faith can raise.

But I'm also respectful that people of different faiths can practice their religion even if they don't subscribe to the exact same notions that I do, and that they are still good people and they are my neighbors and they are my friends and they are fighting alongside us in our battles.

And, you know, I want to make sure that this country retains that -- that sense of purpose. And I think tomorrow is a wonderful day for us to remind ourselves of that.

OK. Natasha Mozgovaya of Haaretz. Is she here? Natasha?

There you are back there.

QUESTION: Mr. President, back in the region the Palestinian and the Israelis leaders, they sound a bit less ready for this historic compromise. President Abbas, for example, said the Palestinians won't recognize Israel as a Jewish state.

The question is, if these talks fail at an early stage, will this administration disengage or maybe you're ready to step up and deepen your personal involvement?

OBAMA: President Abbas and Prime Minister Netanyahu were here last week, and they came with a sense of purpose and seriousness and cordiality that, frankly, exceeded a lot of people's expectations.

What they said was that they were serious about negotiating. They affirmed the goal of creating two states living side by side in peace and security. They have set up a schedule where they're going to meet every two weeks.

We are actively participating in that process. Secretary of State Hillary Clinton will be flying to the Middle East for -- the first series of next meetings on September 14th and 15th.

And so what we've done is to bring the parties together to try to get them to recognize that the path for Israeli security and Palestinian sovereignty can only be met through negotiations.

And these are going to be tough negotiations. There are enormous hurdles between now and -- and our end point. And there're going to be a whole bunch of folks in the region who want to undermine these negotiations. We saw it when Hamas carried out these horrific attacks against civilians, and explicitly said, "We're going to try to do this to undermine peace talks."

There are going to be rejectionists who suggest that it can't happen, and there're also going to be cynics who just believe that the mistrust between the sides is too deep.

We understood all that. We understood that it was a risk for us to promote these discussions.

But it is a risk worth taking. Because I firmly believe that, you know, it is in America's national security interests, as well as Israel's national security interests, as well as in the interest of the Palestinian people, to arrive at a peace deal.

Part of the reason that I think Prime Minister Netanyahu was comfortable coming here was that he's seen during the course of 18 months that my administration is unequivocal in our defense of Israel's security. And we've engaged in some unprecedented cooperation with Israel to make sure that they can deal with any external threats.

But I think he also came here understanding that to maintain Israel as a Jewish state that is also a democratic state this issue has to be dealt with.

I think President Abbas came here despite great misgivings and pressure from the other side because he understood the window for creating a Palestinian state is closing. And there are a whole bunch of parties in the region who purport to be friends of the Palestinians, and yet do everything they can to avoid the path that would actually lead to a Palestinian state -- would actually lead to their goal.

And so the two parties need each other. That doesn't mean it's going to work.

Ultimately, it's going to be up to them. We can facilitate. We can encourage. We can tell them that we will stand behind them in their efforts and are willing to contribute, as part of the broader international community, in making this work. But ultimately, the parties have to make these decisions for themselves.

And I remain hopeful, but -- but this is going to be tough, and I don't want anybody out there thinking that it's going to be easy. The main point I want to make is it's a risk worth taking because the alternative is a status quo that is unsustainable.

And so if these talks break down, we're going to keep on trying.

Over the long term, it has the opportunity, by the way, also to change the strategic landscape in the Middle East in a way that would be very helpful. It would help us deal with an Iran that has not been willing to give up its nuclear program. It would help us deal with terrorist organizations in the region.

So this is something in our interests. You know, we're not just doing this to feel good. We're going it because it'll help secure America as well.

QUESTION: Thank you, Mr. President. A couple of questions.

First, were you concerned at all when you -- when the administration had Secretary of Defense Gates call this pastor in Florida that you were elevating somebody who is clearly from the fringe?

And then, more substantively, on health care reform, this is six months since health care passed. You pledged, A, that you would bend the cost curve, and, B, that Democrats would be able to campaign on this.

And CMS reported yesterday that the cost curve is actually bending up: from 6.1 percent to 6.3 percent post-health care legislation. And the only Democrats I've seen talking about health care legislation are running TV ads saying that they voted against it.

Thank you.

OBAMA: With respect to the individual down in Florida, let me just say -- well, let me repeat what I said a couple of days ago: The idea that we would burn the sacred texts of someone else's religion is contrary to what this country stands for. It's contrary to what this country -- this nation was founded on. And, you know, my hope is is that this individual prays on it and refrains from doing it.

But I'm also commander in chief. And we are seeing today riots in Kabul, riots in Afghanistan, that threaten our young men and women in uniform.

And so we've got an obligation to send a very clear message that this kind of behavior or threats of action put our young men and women in harm's way. And it's also the best imaginable recruiting tool for Al Qaeda. And although this may be one individual in Florida, part of my concern is to make sure that we don't start having a whole bunch of folks all across the country think this is the way to get attention.

This is a way of endangering our troops, our sons and daughters, fathers and mothers, husbands and wives, who are sacrificing for us to keep us safe. And you don't play games with that.

So, you know, I hardly think we're the ones who elevated this story, but it is, in the age of the Internet, something that can cause us profound damage around the world, and so we've got to take it seriously.

With respect to health care, what I said during the debate is the same thing I'm saying now, and it's the same thing I will say three or four years from now.

Bending the cost curve on health care is hard to do. We've got hundreds of thousands of providers and doctors and systems and insurers, and what we did was we took every idea out there about how to reduce or at least slow the costs of health care over time.

But I said at the time it wasn't going to happen tomorrow, it wasn't going to happen next year. It took us decades to get into a position where our health care costs were going up 6, 7, 10 percent a year. And so our goal is to slowly bring down those costs.

Now, we've done so also by making sure that 31 million people who aren't getting health insurance are going to start getting it.

And we have now implemented the first phase of health care in a way that, by the way, has been complimented even by the opponents of health care reform. It has been smooth.

And right now middle-class families all across America are going to be able to say to themselves, starting this month, you know, "If I've got a kid who is under 26 and doesn't have health insurance, that kid can stay on my health insurance. If I've got a child with a pre- existing condition, an insurer can't deny me coverage. If I get sick and I've got health insurance, that insurance company can't arbitrarily drop my coverage."

There are 4 million small businesses around the country who are already eligible, and in some cases will be receiving, a 35 percent tax break on health care for their employees. And I've already met small businesses around the country who say, "You know, because of that I'm going to be able to provide health care for my employees. I thought it was the right thing to do."

So --


QUESTION: -- CMS study from February predicted a 6.1 percent increase, and now post-health care 6.3 percent. So it seems to have bent it up. OBAMA: No -- as I said, I haven't read the entire study. Maybe you have.

But -- you know, if -- if you -- if what the reports are true, what they're saying is, is that as a consequence of us getting 30 million additional people health care, at the margins that's going to increase our costs, we knew that. We didn't think that we were going to cover 30 million people for free. But that the long-term trend in terms of how much the average family is going to be paying for health insurance is going to be improved as a consequence of health care.

And -- and so our goal on health care is if we can get instead of health care costs going up 6 percent a year, it's going up at the level of inflation, maybe just slightly above inflation, we've made huge progress.

And by the way, that is the single most important thing we could do in terms of reducing our deficit. That's why we did it. That's why it's important. And that's why we're going to implement it effectively.

QUESTION: Sorry, and then the House Democrats running against health care, if you could comment on that.

OBAMA: Well, you know, there are -- we're in a political season where every candidate out there has their own district, their own make-up, their own plan, their own message.

And, you know, in an environment where we've still got 9.5 percent unemployment, you know, people are going to make the best argument they can right now.

And they're going to be taking polls of what their particular constituents are saying and trying to align with that oftentimes.

You know, that's -- that's how political races work.

QUESTION: Thank you, Mr. President. I want to ask a couple questions.

On the economy, could you discuss your efforts of reviewing history as it relates to the poverty agenda, meaning LBJ and Dr. King?

And also, since Senate Republicans are holding up the issue of Cobell and Pigford II, can you make any assurances before you leave office that you will make sure that those awards are funded?

OBAMA: Sure. Let me take the second question first.

For those who aren't familiar, Cobell and Pigford relate to settlements surrounding historic discrimination against minority farmers who weren't, oftentimes, provided the same benefits as everybody else under the USDA.

It is a fair settlement. It is a just settlement. We think it's important for Congress to fund that settlement. We're going to continue to make it a priority.

With respect to, you know, the history of fighting poverty, you know, I got my start in public service as -- as a community organizer, working in the shadow of steel plants that had been closed in some of the poorest neighborhoods on the South Side of Chicago. That -- that's what led me to want to serve.

And so, you know, I am constantly thinking about how do we create ladders for communities and individuals to climb into the middle class.

Now, I think the history of antipoverty efforts is is that the most important antipoverty effort is growing the economy and making sure there are enough jobs out there -- the single most important thing we can do. It's more important than any program we could set up. It's more important than any transfer payment that we could have.

If we can grow the economy faster and create more jobs, then everybody is swept up into that virtuous cycle. And if the economy is shrinking and things are going badly, then the folks who are most vulnerable are going to be those poorest communities.

So what we want to focus on right now is broad-based job growth and broad-based economic expansion. And we're doing so against some tough headwinds because, as I said, we are coming out of a very difficult, very difficult time.

We've started to turn the corner, but we're not there yet. And so that is going to be my central focus: How do I grow the economy? How do I make sure that there's more job growth?

That doesn't mean that there aren't some targeted things we can do to help communities that are especially in need. And probably the most important thing we can do after growing the economy generally, is: How can we improve school systems in low-income communities?

And I am very proud of the efforts that we've made on education reform, which have received praise from Democrats and Republicans. This is one area where actually we've seen some good bipartisan cooperation.

And the idea is very simple. If we can make sure that we have the very best teachers in the classroom, if we can reward excellence instead of mediocrity and the status quo, if we can make sure that we're tracking progress in -- in -- in real, serious ways, and we're willing to make investments in what goes on in the classroom and not the school bureaucracy and reward innovation, then schools can improve.

There are models out there of schools in the toughest inner-city neighborhood that are now graduating kids, 90 percent of whom are going to college. And the key is how do we duplicate those.

And so what our Race to the Top program has done is it said to every state around the country, you know, instead of just getting money based on a formula, we want you to compete. Show us how you are reforming your school systems to promote excellence, based on proven ideas out there. And if you do that, we're going reward you with some extra money.

And just the competition alone has actually spurred 46 states so far to initiate legislation designed to reform the school system.

So we're very proud of that. And that, I think, is going to be one of the most important things we can do.

It's not just, by the way, K through 12. It's also -- it's also higher education.

And, as a consequence of a battle that we had -- and it was a contentious battle in Congress -- we've been able to take tens of billions of dollars that were going to banks and financial intermediaries in the student loan program and said, "We're going to give that money directly to students, so that they get more help going to college."

And, obviously, poor kids are the ones who are going to -- going to benefit most from those programs.

QUESTION: Thank you, Mr. President.

Two questions, one on Afghanistan.

How can you lecture Hamid Karzai about corruption when so many of these corrupt people are on the U.S. payroll?

And on the Middle East, do you believe that Israeli Prime Minister Benjamin -- Benjamin Netanyahu should extend the settlement moratorium as a gesture to peace? And if he doesn't, what are you prepared to do to stop the Palestinians from walking?


The -- on Afghanistan, we are in the midst of a very difficult, but very important, project.

I just want to remind people why we're there, the day before September 11th. We're there because that was the place where Al Qaeda launched an attack that killed 3,000 Americans. And we want to make sure that we dismantle Al Qaeda and that Afghanistan is never again used as a base for attacks against Americans and the American homeland.

Now, Afghanistan is also the second poorest country in the world. It's got a illiteracy rate of 70 percent. It has a multiethnic population that mistrusts, oftentimes, each other. And it doesn't have a tradition of a strong central government.

So what we have done is to say we are going to -- after seven years of drift, after seven years of policies in which, for example, we weren't even effectively training Afghan security forces, what we've done is to say, we're going to work with the Afghan government to train Afghan security forces so they can be responsible for their own security; we are going to promote a political settlement in the region that can help to reduce the violence; we are going to encourage an Afghan government that can deliver services for its people; and we're going to try to make sure that, as part of helping President Karzai stand up a broadly accepted, legitimate government, that corruption is reduced.

And we've made progress on some of those fronts. I mean, when it comes to corruption, I'll just give you an example. Four years ago, 11 judges in the Afghan legal system were indicted for corruption. This year, 86 were indicted for corruption.

We have seen Afghan-led efforts that have gone after police commanders, significant business people in Afghanistan, but we're a long way from where we need to be on that.

And every time I talk to President Karzai, I say that, "As important as it is for us to help you train your military and your police forces, the only way that you are going to have a stable government over the long term is if the Afghan people feel that you're looking out for them. And that means making sure that the tradition of corruption in the government is reduced."

And we're going to keep on putting pressure on him on that front.

Is it going to happen overnight? Probably not. Are there going to be occasions where we look and see that some of our folks on the ground have made compromises with people who are known to have engaged in corruption? You know, we're reviewing all that constantly and there may be occasions where that happens.

And I think you're certainly right, Helene, that we've got to make sure that we're not sending a mixed message here. So one of the things that I've said to my national security team is, "Let's be consistent in terms of how we operate across agencies. Let's make sure that our efforts there are not seen as somehow giving a wink and a nod to corruption. If we are saying publicly that that's important, then our actions have to match up across the board."

And -- and, you know -- but it is a challenging environment in which to do that.

Now, with respect to Prime Minister Netanyahu and -- and the Middle East, a major bone of contention during the course of this month is going to be the -- the potential lapse of the settlement moratorium.

The irony is, is that when Prime Minister Netanyahu put the moratorium in place, the Palestinians were very skeptical. They said, "Eh, this doesn't do anything."

And it turns out, to Prime Minister Netanyahu's credit and to the Israeli government's credit, the settlement moratorium has actually been significant. It has significantly reduced settlement construction in the region.

And that's why now the Palestinians say, "You know what? Even though we weren't that keen on it at first, or we thought it was just window dressing, it turns out that this is important to us."

What I've said to Prime Minister Netanyahu is that, given so far the talks are moving forward in a constructive way, it makes sense to extend that moratorium so long as the talks are moving in a constructive way. Because ultimately, the way to solve these problems is for the two sides to agree what's going to be Israel, what's going to be the state of Palestine, and if you can get that agreement, then you can start constructing anything that the people of Israel see fit in undisputed areas.

Now, I think the politics for Prime Minister Netanyahu are very difficult. His coalition -- I think there are a number of members of his coalition who've said, "We don't want to continue this." And so, you know, one of the things that I've said to President Abbas is, "You've got to show the Israeli public that you are serious and constructive in these talks so that the politics for Prime Minister Netanyahu, if he were to extend the settlement moratorium, would be a little bit easier."

And -- and, you know, one of -- one of the goals, I think, that I've set for myself and for my team is to make sure that President Abbas and Prime Minister Netanyahu start thinking about how can they help the other succeed, as opposed to how do they figure out a way for the other to fail.

Because if they're going to be successful in bringing about what they now agree is the best course of action for their people, the only way they're going to succeed is if they are seeing the world through the other person's eyes.

And that requires a personal relationship and building trust. Hopefully, these -- these meetings will help do that.

QUESTION: Mr. President, though, what does it say about the status of American system of justice when so many of those who are thought to be plotters for September 11th or accused or suspected terrorists are still awaiting any kind of trial?

The -- why are you still convinced that a civilian trial is correct for Khalid Sheikh Mohammed? And why has that stalled?

And will Guantanamo remain open for another year?

OBAMA: Well, the -- you know, we have succeeded on delivering a lot of campaign promises that we made.

One where we've fallen short is closing Guantanamo. I wanted to close it sooner. We have missed that deadline.

It's not for lack of trying. It's because the politics of it are difficult.

Now, I am absolutely convinced that the American justice system is strong enough that we should be able to convict people who murdered innocent Americans, who carried out terrorist attacks against us. We should be able to lock them up and make sure that they don't see light of day.

We should -- we -- we can do that. We've done it before. We've got people who engaged in terrorist attacks who are in our prisons -- maximum security prisons all across the country.

But, you know, this is an issue that has generated a lot of political rhetoric. And people understandably, you know, are fearful.

But -- but one of the things that I think is worth reflecting on after 9/11 is, you know, this country is so resilient, we are so tough, we can't be frightened by a handful of people who are trying to do us harm, especially when we've captured them and we've got the goods on them.

So, you know, I've also said that there are going to be circumstances where a military tribunal may be appropriate. And the reason for that is -- and I'll just give a specific example.

There may be situations in which somebody was capture in-theater, is now in Guantanamo. It's very hard to piece together a chain of evidence that would meet some of the evidentiary standards that would be required in an Article III court. But we know that this person is guilty. There is sufficient evidence to bring about a conviction.

So what I have said is, you know, the military commission system that we set up, where appropriate for certain individuals, that would make it -- it would be difficult to try in Article III courts, for a range of reasons, we can reform that system so that it meets the highest standards of due process and prosecute them there.

And so I'm prepared to work with Democrats and Republicans, and we, over the course of the last year, have been in constant conversations with them about setting up a sensible system in which we are prosecuting where appropriate those in Article III courts. We are prosecuting others, where appropriate, through a military tribunal. And in either case, let's put them in prisons where our track record is they've never escaped.

And by the way, just from a purely fiscal point of view, the costs of holding folks in Guantanamo is massively higher than it is holding them in a supermax -- maximum security prison here in the United States.

QUESTION: (inaudible) Khalid Sheikh Mohammed? Will that trial ever happen?

OBAMA: Well, the -- I think it needs to happen. And we're going to work with members of Congress, and this is going to have to be on a bipartisan basis, to move this forward in a way that is consistent with our standards of due process; consistent with our Constitution; consistent also with our image in the world of -- of a country that cares about rule of law. You can't underestimate the impact of that.

You know, Al Qaeda operatives still cite Guantanamo as a justification for attacks against the United States -- still, to this day. And, you know, there's no reason for us to give them that kind of talking point when in fact we can use the various mechanisms of our justice system to prosecute these folks and to make sure that they never attack us again.

QUESTION: You mentioned something about some of the Al Qaeda leaders that you have captured. One that you have not is Osama bin Laden. Tomorrow is going to be nine years since he was the mastermind of 3,000 Americans being killed.

And what you said -- obviously the last administration had seven years and couldn't do it. But what you said as President-elect to CBS is, quote, "I think capturing or killing bin Laden is a critical aspect of stamping out Al Qaeda. He is not just a symbol. He's also the operational leader of an organization planning attacks against the U.S."

Do you still believe it's a critical part of your policy to capture or kill him? And do you think -- isn't it a failure of your administration to that here it's almost two years in -- you campaigned saying you were going to run a smarter war on terror than the Bush administration. You haven't captured him and you don't seem to know where he is.

OBAMA: Well --


-- I think capturing or killing bin Laden and Zawahiri would be extremely important to our national security. Doesn't solve all our problems, but it remains a high priority of this administration.

One of the things that we've been very successful at over the last two years is to ramp up the pressure on Al Qaeda and their key leaders.

And as a consequence, they have been holed up in ways that have made it harder for them to operate.

And part of what's happened is, is bin Laden has gone deep underground. Even Zawahiri, who is more often out there, has been much more cautious.

But we have the best minds, the best intelligence officers, the best special forces, who are thinking about this day and night. And they will continue to think about it day and night as long as I'm president.

QUESTION: But so do you think Americans are going to face another nine years of this terror threat, another generation? What's your message --


OBAMA: Here's what I think.

I think that in this day and age there are going to be -- there is always going to be the potential for an individual or a small group of individuals, if they are willing to die, to kill other people. Some of them are going to be very well organized and some of them are going to be random.

That threat is there, and it's important, I think, for the American people to understand that. And not to live in fear; it's just a reality of today's world that there are going to be threats out there.

We have, I think, greatly improved our homeland security since 9/11 occurred.

You know, I am constantly impressed with the dedication that our teams apply to this problem.

They are chasing down every thread, not just from Al Qaeda, but any other actor out there that might be engaging in terrorism. They are making sure that even a -- what might appear to be a lone individual who has very little organizational capacity, if they make a threat, they follow up.

But one of the things that I want to make sure we do as long as I'm president and beyond my presidency is to understand America's strength in part comes from its resilience. And that we don't start losing who we are or overreacting if, in fact, there is -- there is the threat of terrorism out there.

We go about our business. We are tougher than them. Our families and our businesses and our churches and mosques and synagogues and our Constitution and our values -- that's what gives us strength.

And we are going to have this problem out there for a long time to come, but it doesn't have to completely distort us and it doesn't have to dominate our foreign policy. What we can do is to constantly fight against it.

And I think, ultimately, we are going to be able to stamp it out. But it -- it's going to take some time.

STAFF: Last question.

QUESTION: Thank you, Mr. President.

I wonder if I can get you to weigh in on the wisdom of building a mosque a couple of blocks from ground zero.

We know that the organizers have the constitutional right. What would it say about this country if they were somehow talked out of doing that?

And hasn't the Florida minister's threat to burn a couple hundred copies of the Koran -- hasn't the threat itself put American lives in danger, sir?

OBAMA: Well, on the second -- on your second question, there is no doubt that when someone goes out of their way to be provocative in ways that we know can inflame the passions of over a billion Muslims around the world at a time when we've got our troops in a lot of Muslim countries, that's a problem. And it has made life a lot more difficult for our men and women in uniform who already have a very difficult job.

With respect to the mosque in New York, you know, I think I've been pretty clear on my position here. And that is is that this country stands for the proposition that all men and women are created equal, that they have certain inalienable rights. One of those inalienable rights is to practice their religion freely. And what that means is that if you could build a church on a site, you could build a synagogue on a site, if you could build a Hindu temple on a site, then you should be able to build a mosque on a site.

Now, I recognize the extraordinary sensitivities around 9/11. You know, I -- I've met with families of 9/11 victims in the past. You know, I can only imagine the -- the continuing pain and anguish and sense of loss that they may go through. And tomorrow, we as Americans are going to be joining them in prayer and remembrance.

But I go back to what I said earlier. We are not at war against Islam.

We're at war against terrorist organizations that have distorted Islam or falsely used the banner of Islam to engage in their destructive acts.

And we've got to be clear about that. We've got to be clear about that because if we're going to deal with the problems that Ed Henry was talking about, if we're going to successfully reduce the terrorist threat, then we need all the allies we can get.

The -- the folks who are most interested in a war between the United States or the West and Islam are Al Qaeda. That's what they've been banking on.

And, fortunately, the overwhelming majority of Muslims around the world are peace-loving, are interested in the same things that you and I are interested in: How do I make sure I can get a good job? How can I make sure that my kids get a decent education? How can I make sure I'm safe? How can I improve my lot in life? And so they have rejected this violent ideology for the most part -- overwhelmingly.

And -- and so from a national security interest, we want to be clear about who the enemy is here. It's a handful of -- a tiny minority of people who are engaging in horrific acts, and have killed Muslims more than anybody else.

The other reason it's important for us to remember that is because we've got millions of Muslim Americans, our fellow citizens, in this country. They're going to school with our kids. They're our neighbors. They're our friends. They're our co-workers.

And, you know, when we start acting as if their religion is somehow offensive, what are we saying to them? I've got Muslims who are fighting in Afghanistan in the uniform of the United States armed services. They're out there putting their lives on the line for us, and we've got to make sure that we are crystal clear, for our sakes and their sakes, they are Americans, and we honor their service.

And part of honoring their service is making sure that they understand that we don't differentiate between them and us. It's just us. And that is a principle that I think is -- is -- is going to be very important for us to -- to sustain. And I think tomorrow is an excellent time for us to -- to reflect on that.

Thank you very much, everybody.

KING: The president of the United States leaving.

We're back. I'm John King in Washington. This is a special edition of the CNN NEWSROOM.

One hour and 17 minutes. The president first delivering an opening statement, then taking questions. He called on 13 correspondents in all.

The topics ranged from what the president came into the East Room to talk about, the economy, to just about everything else -- Middle East peace; policies here at home; a war on poverty; what would he do about poverty here at home; to that last question about the proposed Koran burning by a minister; and the president's views on whether a mosque and Islamic cultural center should be built just steps from Ground Zero, a question the president answering one day before the nation marks the ninth anniversary of 9/11.

A lot to talk about, including the president's effort to turn the midterm campaign economic debate. The best political team on television is with us. Let's start by getting an observation from our senior political analyst, David Gergen, who has been watching all this from Boston.

David, a lot of ground covered. What did you come away with?

DAVID GERGEN, CNN SENIOR POLITICAL ANALYST: Well, John, once again, he impresses everyone with his competence. He has capacity to deal with a range of issues. The subtly of his mind I think is very impressive.

At the same time, I thought it was mostly passionless, and frankly boring as it went on and on until that last question on the mosque, and then it came alive. And I think the president -- that's going to be -- his statements today, very passionate, controversial, but he took a much clearer stand in favor of the mosque going there than anything he said in the past.

KING: And to David Gergen's point, as we come back into the room here, Candy, the president, of course, the goal here was to say, look, I'm trying. I know it's tough out there. Our economic policies are the right policies, and the Republican policies are the wrong policies that would take you back. We've heard that over and over again.

But David is dead on in the sense that the president, he gave substantive answers. There were -- some of these answers, I'm looking at one that -- one ran six minutes, one ran three minutes, one ran three, one ran seven. Long, substantive answers, but only in the end there did he seem to get fired up about, look, there are Muslim troops serving under me, your commander-in-chief, and we need to be careful about the message we send.

CROWLEY: Yes. And, you know, perhaps part of the reason is there was very little new that we heard in terms of the economy. He's done this before.

He said -- I mean, at times, it was a campaign speech. So we have heard this. He has heard this. And he is not a guy that really likes particularly the repetition of the campaign trail and saying things over and over again, so maybe that accounts for it.

But there was something that we all noticed, and it comes to what maybe this fall's hot topic, although there are some Democrats that would like to make sure it isn't, and that is the idea of the expiring Bush tax cuts. And what the administration wants to do is keep them in place for the middle class, two words we heard a lot, but go ahead and let those tax cuts expire for those making -- couples making $250,000 and over.

So the question to the president was, is there any wiggle room? And here was the question and the answer.


OBAMA: Well, certainly there is going to be room for discussion. My hope is, is that on this small business bill that is before the Senate right now, that we actually make some progress.

I still don't understand why we didn't pass that two months ago. As I said, this was written by Democrats and Republicans. This is a bill that traditionally, you would probably get 90 percent or 100 percent Republican support, but we have been playing politics for the last several months. And if the Republican leadership is prepared to get serious about doing something for families that are hurting out there, I would love to talk to them.


CROWLEY: So first to Erick Erickson.

So, is there wiggle room here with the president? Is he willing to talk about some temporary extension of those tax cuts for the wealthy or not? Try to interpret that for us.

ERICKSON: I'm not really sure. I heard yes, that he's willing to talk about it, and I also heard no.

I really think this goes back to -- I forget who asked the question, but isn't this just politics? You wait until the end. And the problem for the president is, the American public has seen him, despite having this Republican filibuster attempts in the Senate, pass health care reform, pass the stimulus, pass financial reform, and now he's going to say, but I can't pass anything for the middle class because of the Republicans? That calculus isn't going to add up for people.

CROWLEY: Let me bring in Roland Martin, who has been standing by with us and listening to all of this.

Roland, part of the reason that the administration held this news conference is the president has got to get all of those people who voted for him in 2008 to come out and vote for Democrats in 2010.

Did you see anything in this news conference where you think voters went, yes, I've got to get out and go to those polls?

ROLAND MARTIN, CNN CONTRIBUTOR: Well, I think -- first of all, remember, we're in the midst of the NFL kicking off this weekend, and so I'll use a football analogy. He's the quarterback while doing that -- go Houston Texans.

He is the quarterback. He has to set the tone. And so part of the problem here, the White House and Democrats have been off. And so when he comes out and says, look, I will sign this bill this month as it relates to middle class tax cuts, what are you going to do, what do you want to do? That's the way of doing that.

He also, I think, broke down in a sense what the Democrats have to articulate. And that is, how bad of a situation we were in walking to the door, and how we are on this road to progress. And I think he could have been more clear by saying, look, Republicans constantly have thrown up roadblocks, they constantly are saying no, blocking appointments, they want to block progress. That's really what he was trying to do there.

But let me also address something that David said. David talked about, well, the nuance and what he said, and it was boring. Well, you know what? He's not an entertainer. And so I never get the sense watching the president, that the president really should be entertaining and really should come out, you know, guns blazing.

He is going to talk about policy and these issues. And so I listen to anybody out of Washington, D.C., I'm really not looking for somebody who is going to just enamor me in terms of how great they are. They're going to talk about things in a substantive way.

And so, that's really how I took it. And I think anybody who is wanting the president to say something when it comes to policy, you got that, not entertainment.

KING: I think Roland Makes an interesting point in saying that he's not looking for an entertainer, and I think part of the broader point about that is that we need to remember in today's day and age of communication, there are so many different audiences for the president. How many people are watching from 11:00 to noon on a Friday afternoon?

MARTIN: Of course.

KING: But how many people will get this news in so many different ways, whether it's radio or television, whether it's on the Internet, whether it's from their own interest groups, the e-mail chains they sign up for, the blog that Erick writes that maybe they sign up for? So people will get this from the niche. The economic outlets will write about the economy stuff.

My question, Gloria, as you come in here, we're heading into the 9/11 weekend. Tomorrow is the ninth anniversary.

BORGER: Right.

KING: The president wants to have a conversation about the economy. He wants to help Democratic candidates out there in their races. But my bet is for the next 24 to 48 hours, in part because of the anniversary and in part because of what the president said right at the very end, the conversation is going to be, the president once again, very publicly, saying the developers of that mosque and Islamic cultural center near Ground Zero have every right to build it, and he says -- essentially saying those who oppose it, be careful what the message you're sending.

BORGER: Right.

KING: And then talking also a bit about the pastor who was threatening this has now canceled the plan. That's going to dominate the conversation for the next 24 to 48 hours.

BORGER: It was interesting, because he brought up George W. Bush, not in terms of leaving the economy in a ditch, as he would say, but he brought up George W. Bush to say one thing he really respected about President Bush was the way he said this is not a war on Islam. And he used that as a way to talk about the right to build the mosque and to talk about why you should not burn the Koran.

And what also struck me -- it's kind of interesting to me. He was so passionate, as David pointed out, when he spoke about the mosque. Less so on the economy. And maybe that's because the arguments are not so clear on the economy.

The argument he is making on the economy is that it could be worse, right? And that's not a passionate argument, and it's a difficult argument when you've got 10 percent unemployment. The point he's making on the mosque is very clear-cut, so it's easier for him to be a little bit -- a little bit more emotional about that.

KING: And let's hear -- you mentioned the president praising George W. Bush. Let's hear that, and then I want others to come into the conversation.

If you talk to people close to the president, A, they would degree agree with you, the economy is a harder argument. B, they would also say that as an African-American who has experienced discrimination in his life, that this is a more passionate, personal issue for him.

Let's listen first to the president talking about George W. Bush after 9/11 in President Obama's consideration. Set the tone just right.


OBAMA: One of the things that I most admired about President Bush was after 9/11, him being crystal clear about the fact that we were not at war with Islam. We are at war with terrorists and murderers who had perverted Islam, had stolen its banner to carry out their outrageous acts.

And I was so proud of the country rallying around that idea, that notion, that we are not going to be divided by religion, we're not going to be divided by ethnicity. We are all Americans. We stand together against those who would try to do us harm.


KING: And so, Donna, the president makes that case there that the at the very end gets more animated and more passionate. Essentially, and I'm paraphrasing, saying be careful to anyone out there who opposes those plans for the cultural center and mosque near Ground Zero. The president, as he says that, knows that if you poll and ask that simple question, should it be there, about seven in 10 Americans say no.

BRAZILE: You know, I understand the need to always use polls to guide our thinking, but, you know, nine years ago we were attacked. The country was attacked. We came together as one nation to try to figure out what happened and how to go after those who attacked our nation.

I think tomorrow is a day, as the president said, a day of service, a day to remember the attack on our soil, but also remember that we, every American, practically, stood together and said we wanted to help those who have been attacked. Muslim-Americans also died that day. Muslin-Americans are also giving their lives in the cause of freedom and justice overseas.

I think that's why the president became animated. Not because of his own personal experience so much, but because that day, nine years ago, we all came together as one people.

CROWLEY: It sort of occurs to me here that this is not a subject he actually wanted to have come up.

ERICKSON: You know, I was going to say that. The takeaway from this should have been the discussion of the tax cuts and what have you, but I'm getting on e-mail right now. In addition to the fact he didn't want to use the word "stimulus," was that the only thing that fired him up in this is a topic that 70 percent of Americans disagree with him on.

And it comes to this issue with independents, I think, where there is a sense out there that polling is picking up, that you have a lot of independents -- forget conservatives -- who think he has a different world view from them, which is different from disagreeing with the guy on a policy. It's something more substantive that is harder to overcome.

CROWLEY: But what about giving him props for that?

MARTIN: You know what -- you know what -- you know what, John --

CROWLEY: Go ahead, Roland.

MARTIN: Yes, I mean, first of all, I can appreciate a president of the United States recognizing that we have a -- you have a Constitution that talks about religious freedom. I can appreciate a president, even if there are people with this whole different world view, who recognizes that there are Muslims who are indeed Americans. Maybe the problem here is not the president. Maybe the problem here is we have some Americans who don't want to fully accept of that there are Muslim-Americans. That we are indeed one country. That's really what I see here.

But also, when we talk about what's going to dominate the conversation, let's also be honest. We set the conversation. If we spend more time talking about a New York mosque or this preacher in -- this preacher in Florida, as opposed to the economy, then we also -- are also driving the conversation. So let's not remove ourselves from this whole issue.

BORGER: You know, and I think the president wanted -- he came to this press conference and he was a man with a mission, right? I mean he was on message, as on message as I have ever seen him about the middle class, the middle class tax cuts, why can't we all get together on a small jobs bill? Leaving the door a little bit open for maybe a bit of a compromise. I think we heard that on the -- on the extension of the tax cuts for the wealthy for a while if he gets a jobs bill. That's important to the American public and that was something he said over and over and over and over again.

CROWLEY: Let me just -- I want to wrap-up with something that -- and, David, I'll get to you in just a second. I want to play something to Roland's point about responsibility. But the fact of the matter is, when the president was asked directly, OK, setting aside freedom of religion -- we all understand that you're for freedom of religion -- how do you feel about the wisdom of this? And I think he went further than he has gone about allowing that mosque to go up near Ground Zero. Take a listen.


OBAMA: One of those inalienable rights is to practice their religion freely. And what that means is that if you could build a church on a site, you could build a synagogue on a site. If you could build a Hindu temple on a site, then you should be able to build a mosque on the site.

(END VIDEO CLIP) CROWLEY: Now, again, I mean he's talking about being able to. And, David Gergen, let me bring you in on this. It does seem the president went a little bit further. And shouldn't we sort of give some high marks to a president who is willing to take on a polling that shows that most people are opposed to this and to move ever closer to saying, yes, they ought to build it there?

GERGEN: That's an interesting question, Candy. I do think that you're right on your first point, and that is that after the -- that his first statement seemed to suggest he thought they had a right to do it and should go forward. The next day, you remember, he backed away and said, I really wasn't talking about the wisdom of doing this. And so there was a sense of wavering and having it both ways.

Today I thought he was much more clear-cut. Not only do they have a legal right to do it, but I think it is the right thing to do and we should embrace -- we should embrace this as part of embracing American-Muslims. That is -- given the polls, yes, there is courage in doing that. I think he did come squarely down on that. But, you know, this is a matter of controversy. We're going to continue to talk about this.

I want to go back to, though, what I thought the purpose of the press conference was. He came out the -- out of the gate with a nakedly partisan statement, attack on Republicans, right off the top, so that he clearly was trying to use this press conference to encourage and rally Democrats. And my only point about the boring quality was that I wasn't at all sure in the conversation that followed that he was very professorial. I just didn't think there was much electricity to it. I don't think he's supposed to be an entertainer, but there was a time when Barack Obama, the candidate, when he spoke about issues, created an enormous sense of electricity, of hope, stirred people's hopes.

And I think that somehow over time that's been -- that's been lost. And I think he hasn't quite found his voice yet again. So that I'm not looking for an entertainer, but I do think that it's worth understanding that one of the reasons he's having trouble rallying Democrats is his voice isn't -- isn't communicating in the same way.

KING: And --

MARTIN: But also I think we have to also -- we also have to recognize that when you are running for office, you are operating in different settings as opposed to the East Room of the White House. The second thing is, the gravity of the situation. I don't think the president can come out, you know, frankly, as vigorous as he was campaigning, as he can on the day before September 11th. When you're talk about the economy. He can't be flippant. He can't sit here -- I mean even, you know -- you even notice when he made a slight joke as it related to the Republicans saying no, and he came back and said, I don't mean to be funny. And so he has to sit here and frankly juggle all of those balls. And, again, it's a different situation when you're campaigning and now you're the one sitting in the hot seat.

GERGEN: I would argue that the opening statement was a campaign statement. There is no --

MARTIN: Oh, absolutely.

GERGEN: I was surprised by how openly partisan and political it was. And given that context, he was trying to do something today in terms of rallying the Democratic base. And I saw little evidence that he did that. Maybe I'm wrong.

KING: All right, a quick time out. A quick time out. As you can see, it's a feisty conversation and it is an important conversation. We're seven weeks from a big midterm election campaign. One of the questions when we come back, did the president help himself or hurt himself out there where you get to vote in seven weeks? And what do the Democrats candidates, the venerable Democrats, think of his performance? We'll deal with that when we come back.

Also still ahead, stay with CNN, an update on that horrific gas explosion in San Bruno, California. We'll have the latest when this special edition of CNN NEWSROOM continues.


CROWLEY: Welcome back to our special coverage of the president's news conference just completed. We want to bring in our Dana Bash on Capitol Hill.

Dana, this was a news conference that the president, anyway, wanted to aim toward nervous Democrats. He wanted to try and help them as they're looking at these ever-plummeting poll numbers. Do you think he helped anybody?

BASH: Well, I can answer that by telling you what some of the Democratic sources I've been e-mailing with and talking to throughout the press conference said, and the answer is overall they think he was helpful. And specifically doing what they were very happy about early in the week when he gave two big speeches, and that is laying down that contrast between Democrats and Republicans, specifically that big picture warning about, you know, if you don't vote for us, you're going to vote for the other guys who have old ideas and worn ideas, in the words of the president.

But, and there is a but here, one Democratic strategist said that there still wasn't enough specificity on the whole controversial issue of tax cuts. Look, Democrats are kind of split on this issue of whether or not those making the most money in this country, families making $250,000 or more should have that tax cut extended or not. He said at the beginning, look, the wealthiest Americans shouldn't have it. But then in response to the question he was asked about it, he kind of talked about a whole different tax proposal that's before Congress.

And another very interesting point one other Democratic source made to me, Candy, and that is when Jake Tapper asked the president about the health care law, and why people's rates are going up right now, he gave a very long answer, a substantive answer, but very long answer about why things are the way they are, when this Democratic strategist said, wait a minute, the answer should have been, patience, people, this takes time and some of the policies that we put in place aren't even going to go into effect for a year. So there was frustration on that particular issue, because that is something that Republicans are in some cases successfully pounding Democrats on out on the campaign trail, that health care law.

CROWLEY: And I think, you know, John, she's perfectly right, they're perfectly right, that in the end, the message the president has on the economy that he has to sell is, well, OK, you can stick with us or you can go back to the people that caused this mess. And that's sort of what he wanted to drive out there.

KING: And if you look at the data, and Donna has a point, sometimes we look too much at the data, but when you're this close to an election, you do look at the data. And independent voters, by and large, especially in key big states and key big congressional districts have moved to the right away from this president because they don't think Washington looks like what he promised. They don't think the economy has turned around fast enough.

So the president's goal to me was very apparent today, was to get his own base. If the Republicans are energized and the independents are going the other way, Democratic hopes of picking up that race there and that race there is to get their people out.

And I said to bring in David and Roland for a final thought on this. And, David Gergen, to you first, because you've been there in the Oval Office before a president goes out to do this. And the president has an agenda and you're right, he started off with a very important statement on the economy. But -- but, then, of course, he has to cover the whole world, because you never know what you're going to be asked.

GERGEN: Well, that's true, John. And, look, I think he -- I think he made his points. Again, I don't think there was much electricity, but he got his points out. I think when you let a press conference go an hour and 15 minutes, an hour and 17 minutes, it gets blander. You know, it used to be that you'd give an opening statement and it would be 30 minutes. You'd have 30 minutes of questions and answers and the president was able to get his point out and keep that point central. When you open it up to make it, you know, a sort of wall to wall for an hour and 15 minutes, you're inevitably going to be drawn in a lot of different directions and it's harder to rifle-shot your message. You've get much more of a shotgun.

KING: Roland, does he help himself in the sense that if the goal is to rally the base, he did start with that economic statement. And right near the end he also was saying, you know what, I didn't keep my promise to close Guantanamo, reminding some people on the left of some things they're not happy about.

MARTIN: You know what, if I don't have a job right now, if I lost my 401(k) and unemployment benefits have run out, I'm really not thinking about Guantanamo Bay. He has to follow this up, again, by continuing to go on the offensive by saying the Republicans consistently have put up road blocks for the last 18 months on this road to recovery. That has to be the message. He has to give other Democrats the confidence to actually say it, as well, that what they have done has made sense.

And so he tries -- he did it early on. I agree with David. I thought news conference should have been cut off around the 55 minute mark, excuse me at 55, as opposed to going over another 15 minutes. He has to do that because if they don't do that, they're not giving any people on the left or any progressives any confidence that what they did was the right move.

KING: So as we bring it back into the room, Donna Brazile, let's count down. The president obviously getting more involved, making it more about him, trying to rally his voters. And yet if you look at his calendar, he's going to Pennsylvania, Ohio, Wisconsin and Nevada. Only one state west of the Mississippi. No states south of the Mason-Dixon line. I think I got that right. And I guess maybe if he gets in southern Ohio, he can get close. What is his role now?

BRAZILE: His role is to rally the base, help raise money for the party and really to sharpen the contrast between the Democrats who have tried to govern in a common sense way to get the economy off the cliff, back down to the road of growth. And I think in the long run, John, if the president can rally the base, if we can close in the margin with the Republicans and these generic scenarios, then I think turnout will be the key. We know the Republicans are very motivated. But you know what, at the end of the day, and I've run a lot of campaigns, give me three weeks and cash in the bank, I can get three to four percent if the weather holds.

CROWLEY: But here's the problem, Erick Erickson, and that is that, yes, the president does have a base to get out and he can get them out. But what's bothering the independents, in addition to the economy, is they don't like the icky pounding on each other part. And so then he -- you know, he can't be in both those worlds.

ERICKSON: You know, and it's not just that. The president started his press conference today by pointing out 750,000 jobs have been created this year. His problem is that in May of last year, CNN was reporting the White House was saying we would create 750,000 jobs by August of last year. He wouldn't use the stimulus. He wouldn't use the word stimulus today. That's -- a lot of people are already e-mailing in saying that.

Independent voters really don't believe what they're hearing from Washington. They don't believe Republicans or Democrats. But they're just saying it's not working, they're throwing mud at each other and they're kind of tired of it.

BORGER: You know, I think there's just kind of a mixed message here. And it's a muddle for the White House and for Democrats, which is on the one hand they have to acknowledge your pain, because unemployment is still high. So they have to say, OK, we understand things are bad. Then they have to take a turn and say, but it's not as bad as it would have been if the other guys had had been in charge. And then they take another turn and say, and we're on the right track. So it's not as clear-cut a message as a Democrat running -- I mean correct me if I am wrong, Donna, as a Democrat running for re-election would like to have right now.

BRAZILE: But you know what the Democrats can go out there and say, we came into office, we saw the mess, we started cleaning up.

BORGER: Right.

BRAZILE: We brought our shovels, we brought our rakes, we got to work. Republicans, they've been whining, they've been complaining, they've been just waiting for the day that they can come back into office so that they can continue to bail out the rich, give them the tax cuts, and meanwhile, they have offered zero solutions. I think Democrats have to sharpen the message and not -- if they start playing offense -- we've been playing defense for too long. Erick, we've given you too much to do with that little applause (ph) thing.

ERICKSON: The problem though is that this was exactly Bill Clinton's message after Labor Day in 1994, that we can't go back to George Bush, ironically. That they messed it up and you need to give us more time. And it didn't work for them.

CROWLEY: One word answer all along, because we've got to wrap this up. Here's your question. Does the president have the juice to still get out his base, which has been disheartened, yes or no?

ERICKSON: Yes, but it shrunk.

BRAZILE: Absolutely. And you know what, you're going to be surprised on election night.

CROWLEY: Gloria, go, quick.

BORGER: I don't think so.

KING: Different parts of the country. It's a different stake in Ohio than it is in Missouri, than it is in Colorado. This is a very complicated 50-piece puzzle. The president's trying to help today. We've got seven weeks to go. We're all going to have a lot of fun covering what is a fascinating campaign.

But at the moment, we're going to turn things over to our friend Tony Harris at the CNN NEWSROOM in Atlanta and he'll continue the conversation throughout the day.

Hey, Tony.