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PARKER SPITZER

Interview With Matt Taibbi; Lesson From Late Night Comedy

Aired November 8, 2010 - 20:00   ET

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


KATHLEEN PARKER, CNN NEWS ANCHOR: Good Friday. I'm Kathleen Parker.

ELIOT SPITZER, CNN NEWS ANCHOR: And I'm Eliot Spitzer. Welcome to the program and indeed, a great program tonight. We begin with an author who's described Goldman Sachs as a vampire squid, and boy, he is just as tough on the Tea Party. I'm talking about Matt Taibbi, a writer for "Rolling Stone," he is one great guest.

PARKER: Awesome writer, too. And guess what, Eliot, can you imagine if the courts in our country could reverse their election results if a candidate lied? Well, it actually happened in Britain and we're going to have that in a bit, too.

SPITZER: That will be fun to chat about. As well, our own Fareed Zakaria, he is brilliant, he writes about every. Today we will discuss China, what is happening to China as the president visits Asia and what our relationship with the rest of the world is turning into.

But first, as always, our "Opening Argument" and I begin with a question, who's on first? No, I'm not doing Abbott and Costello for you, Hu Jintao, the president of China, the most powerful person of the world, according to "Forbes" magazine. Used to be the president of the United States, no longer. This is what is happening to the U.S. place in the world, and it goes beyond China, now leading the international effort to trash QE2, the last-ditch effort, the last arrow in our quiver to bring back our economy.

PARKER: China doesn't like the QE2?

SPITZER: I thought it was a boat until recently, but what do I know?

PARKER: Well, I'm glad to hear you thought so. It's not only China, Eliot, other countries; Germany and Russia have chimed in, they're upset with us. And but we've got plenty of criticism right here at home in our domestic front, including from a well-known finance expert, who's just weighed in.

SPITZER: Who's that?

PARKER: Sarah Palin.

SPITZER: Oh, my goodness. PARKER: Let me read you what she's says. She has written, she's put out a statement (INAUDIBLE) QE2 and she says, "It means our government is pumping money into the banking system by buying up treasury bonds. And where, you may ask, are we getting the money to pay for all this? We're printing it out of thin air."

Now, I got to tell you, Eliot, that is one of the simplest, most straightforward explanations I've read.

SPITZER: And she got it kind of right. That's why people want to be chairman of the fed, they do print money, that's their job. But here's the thing. I'm glad Sarah Palin is getting her economic cred in line by passing judgment on this. Do you remember when she was running for president and people said, what do you know about foreign policy, and she said, "Look, we can see Russia from Alaska, therefore I could be secretary of state" or something like that. And everybody said, wait a minute, just because you can see the moon doesn't mean you're an astronaut. You know, there's one thing to see it -- I'm sorry, it was...

PARKER: No, I love that quote, it's just not accurate, OK. I mean, I'm the last person in the world to come to Sarah Palin's defense, but I will defend facts and you know, you're not allowed to -- that was actually Tina Fey who said that. Sarah said something about Putin floating around, I don't remember exactly what it was...

SPITZER: All right, anyway, here's the larger issue. To come back to things that really matter, the real question is, QE2, now that we know what it is, thank you, Sarah Palin, it may not work. In fact, a lot of people say this really is just an effort to get banks to make loans and people to borrow by driving interest rates down a little bit. The problem isn't the interest rate right now. The problem, there isn't any demand to borrow because people don't need to invest. The whole conversation we've been having for weeks now. So if it fails, then what?

PARKER: I think I would turn now to that expert I referred to earlier.

SPITZER: I want to hear more about what Sarah Palin says about this. I really too.

PARKER: She does have a final word on the subject and I think it's a good way to close out this conversation.

SPITZER: All right.

PARKER: "The German finance minister called the fed's proposals 'clueless.' When Germany, a country that knows a thing or two about the dangers of inflation, warns us to think again, maybe it's time for chairman Bernanke to cease and desist." Sarah, Germany, China, Russia, whoever thunk that we would be...

SPITZER: Strange bedfellows in indeed in this game of politics. But you know what? It says a lot about the U.S. position in the world. You have that international alignment willing to stand up to us. China wouldn't have done that, Germany certainly wouldn't have done it until very, very recently. It speaks a lot about where we are, something for us to think about.

PARKER: Well, It worries me, because we have always thought of ourselves as the super power. And you know, I'm not sure what that means to us. I'm looking forward to talking to Fareed Zakaria and see what he says.

SPITZER: And talk more about China's bold challenge to America, let's head into "The Arena." Joining us now to discuss the brewing international showdown over economic policy between the United States and China, Fareed Zakaria, the host of CNN's GPS.

So Fareed, let me get this straight, the United States and China are battling over this QE2 Quantitative Easing policy that the United States is putting in place. It is our last, best hope to bring our economy back and China is saying, no. Explain this to us.

FAREED ZAKARIA, CNN'S GPS: We're in a world where the emerging countries, particularly China, feel very emboldened, and the effect of the economic crisis has been to make them say, we don't need to listen to you, the United States, anymore. So they're pushing back. I understand that, even though I disagree with them and I think the United States is doing the right thing. But the interesting thing is, how bold they have gotten, not just China, Germany is criticizing the United States, frontally. I mean, think back 25 years ago when Germany was a NATO ally who depended on the United States for protection. We're in a new world.

SPITZER: And this is the first time I can think of that China has had the gumption, the backbone to stand up and essentially say to the United States, you are taking the nation, the world in a very bad economic direction.

ZAKARIA: That's right. I mean, so far the Chinese have always played -- taken the view that they needed to be closely allied to the United States. They did not want to show much difference, and certainly, they didn't want to do public confrontations.

Right now I think you're witnessing the beginning of a new leadership in China. One that is not -- the old leadership came out of the Cultural Revolution. They came out of the world in which the United States had reached its hand out and brought China out of backwardness into the modern world. This new generation has grown up with peace, stability, and prosperity, they're the generation of the Beijing Olympics. Not the Cultural Revolution.

SPITZER: And you'll recognize their economy will be larger than ours within 10, 15, 20 years. And so they're beginning to flex muscles in a way that fundamentally alters their relationship not only with us, but also the other Asian nations.

ZAKARIA: Now, that's where the geopolitics of this gets really interesting, because when China stands up to us, the rest of the world might applaud and say, you know, somebody's sticking it to the superpower, just out of a sense of rooting for the little guy, but what's increasingly happening is China is beginning to make other Asian countries uneasy. In every Asian capital, this has caused enormous alarm, because they look at that and think, is China going to push its weight around with us as well? And so you're beginning to see other countries in Asia look to the United States for assurance. And that's going to be one of the themes undergirding President Obama's trip to Asia. Other Asian countries, other Asian powers like Indonesia, like India, like Japan, looking for assurance that the United States will continue to be the balance of power in Asia.

SPITZER: And in fact, if you look at a map, I think we can throw a map up here on the screen that will show where the president is going. It is almost as though he is circumnavigating China, building an alliance structure reminiscent of containment back in the 1950s and before with Soviet Russia. So, this is sort of a throwback to an earlier era, where we are building a system to stand up to an ascendant power.

ZAKARIA: Precisely. But the way I think we should think of it is we don't want to go down to the containment path, certainly not yet, because we need a strong China. The alternative, a weak, collapsing China, just imagine it. Who would buy our debt? You know, increasingly, China is a big market for us. And the world is so interdependent, it would cause problems. So what we want, I think, is a hedge strategy. Think of the hedge funds...

(CROSSTALK)

SPITZER: (INAUDIBLE) A default swap on this one.

ZAKARIA: Yeah, you love hedge funds, Eliot. But a strategy that says, you know, we want corporate relationships with China, but we are putting in place building blocks in case it doesn't go that way so that we strengthen the relationship with India, with Japan, with Australia, with Indonesia. And what's wonderful about this strategy if we do it right is that we're not the prime initiator, those countries want us as much as we want to be there.

PARKER: Fareed, you said that you agree that QE2 is a good idea. And I don't consider myself qualified to express an opinion on it and I hope it is true there are no dumb questions, because I'm going to ask you what may be one, but does it matter -- does all this pushback from other countries affect the ability of the fed to accomplish what they want to by putting this money back into circulation?

ZAKARIA: No, it's a very good question. The question I was worried you were going to ask me is, why is it called Quantitative Easing, which is a more complicated question.

PARKER: I would never ask that.

ZAKARIA: But look, if other countries are actually involved in adjusting their currencies as well, the South Koreans, actually, very aggressively the Chinese in various ways. So we're doing it and if other countries can counteract what we're doing, it won't work. But at the end of the day, this is one area where we still have enormous leverage and enormous power. In currency matters, we're still the superpower, so I think the fed will be able to do it. And just so people understand, the reason I think it's worth doing is because we have an economy that's stuck in a very low gear of growth. The danger that you worry about when you print money, which is effectively what's happening, is inflation. And I just think there is no prospect of inflation around. If you look at -- labor has no pricing power in today's world. People don't have the ability to raise wages. And wages is what makes up 80 percent of inflation in a rich country.

SPITZER: Fareed, I think that's exactly right when it comes to the inflation risk. I think the greater risk is it simply doesn't work. The whole notion is that you pump this money into the pipeline, somehow that will trigger borrowing and lending by banks to businesses that will then invest and it will trigger the whole economic growth model. There's an issue of demand. People aren't borrowing and loans aren't being made because there really isn't the demand to trigger that sort of loan structure and that's the problem we have.

ZAKARIA: That's my fear, Eliot, which is that with all these temporary measures, we're frankly trying to pump back up the economy in various ways to be more like it was in 2007, it's not going to work because the consumer is maxed out. Businesses are weary, because they went through the worst credit bubble since the 1930s. And so, there's a part of me that thinks really, what we should be doing is, accept that this is going to be a tough few years and try to build an economy for the long-term, and don't keep trying these gimmicks. So, as I say, at the end of the day, I understand what the fed is doing. I don't think it's going to trigger inflation, but the real answer is, build a new economy.

SPITZER: The hard part is explaining that to voters, as the president found out.

ZAKARIA: Yes, the economic cycle here and the political cycle do not coincide.

PARKER: Well, and the other thing I do understand is we really don't have another option, do we?

ZAKARIA: We don't have another option, particularly with this Congress. Because I think that a better option, frankly, would be a very well-targeted set of infrastructure projects, and they do exist, for example, we have the energy grid of this country that could be upgraded, but I think there's very little appetite for that. It could be done through a national infrastructure bank, so we're not using that much taxpayer money, as a public partnership, but you know, sell that to John Boehner.

PARKER: Well, I just got in big trouble with every Republican, and not to mention Sarah Palin.

SPITZER: Well, fiscal policy is off the table at this point, they're simply not going to happen. And I'll come back to the business response to China because that is a very quixotic relationship. The business community is defending China at this point, saying, do not act -- saying this to the U.S. government -- do not begin a trade war and that's because the business community, I think, sees, as you said earlier, huge markets, huge opportunities to invest and so the government which might otherwise be leading more heavily on the Chinese policies is being pulled back the other way by U.S. business leaders.

ZAKARIA: I think that's right. It also demonstrates the degree of interdependence. A Chinese toy costs 10 percent of what it would cost to manufacture in America, even if you got them to revalue their currency so it now cost 15 percent. Wal-Mart is still going to buy the Chinese toy, not the one made in Pennsylvania.

SPITZER: That is true. Having said that, there is an element of truth, the Chinese have managed and I think the word could be used to prove it, manipulated their currency over the years to maintain trade advantages. And so there is something that every nation has done at a certain point in its history.

ZAKARIA: But their labor is just so much cheaper than ours, the currency is just one incremental factor.

SPITZER: One last question, I may get in trouble with my bosses here at CNN, your bosses as well, has the White House called you to bring you into the administration now that they're retooling their entire structure?

ZAKARIA: I have not spoken to them very recently, but I've had conversations, a lot of friends I have there, but I'm very happy doing what I am -- you know, you've done government, you've done this, this is more fun.

PARKER: Well, it might be surprising to you all, but I have had some calls from the White House and, you know, I'll let you know how that works out. Fareed Zakaria, thanks for being with us.

ZAKARIA: Pleasure.

PARKER: And stay with us, we'll be right back.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: This is an opportunity for the politicians of our country to say, this is what's been happening in the last 10 or 15 years, you've been getting screwed over by these people and nobody stood up and did that. Instead, I think the Democrats kind of took the fork in the road and they tried to save Wall Street and communicate to their voters at the same time, but it just didn't work.

(COMMERCIAL BREAK)

SPITZER: Few people have used language and metaphor to capture the public's anger over the financial crisis and those who bear the blame better than Matt Taibbi. His articles for "Rolling Stone" magazine have become legend on TV and in print.

PARKER: Matt Taibbi is our headliner, a contributing editor for "Rolling Stone" and the editor of the new book "Griftopia: Bubble Machines, Vampire Squids and a Long Con that is Breaking America." it's a scathing and often hilarious account of the financial crisis.

Matt, thanks for joining us tonight.

MATT TAIBBI, ROLLING STONE: Thanks for having me on.

PARKER: And to say it's hard to make the financial crisis funny, but you did that successfully.

TAIBBI: It is a very difficult job.

PARKER: And vampire squids, I'm just happy I got to say that on television. I want to read you a description that you wrote of Sarah Palin. You called her a "narcissistic money-grubbing hack." Don't you love being quoted?

TAIBBI: Yeah.

PARKER: Anyway. So Sarah Palin obviously has a lot of followers. She's got the Republican establishment scared to death, so there must be something more to Sarah than just that, huh?

TAIBBI: Well, absolutely. I think one of the things that happened in the wake of this financial crisis, there was this enormous amount of anger and frustration in the population and people were looking for someone to offer them a simple solution, a simple answer for what happened and I think Sarah Palin and the Tea Party perfectly captured that anger. They found a way to crystallize all that frustration and aim it in a direction. You know, I would quarrel with the direction that they've aimed it in, but they've done a very good job at that.

SPITZER: I want to quote something you say in the book, a brilliant phrase and you say, "A lose definition of the Tea Party might be 15 million pissed-off white people sent chasing after Mexicans on Medicaid by a small handful of banks and investment banking companies," then you continue on. This merger of the anger being manipulated by the investment banks and Wall Street and as you point out, Wall Street is getting exactly what it wants and the public is getting virtually nothing to help it. How did that happen?

TAIBBI: Well, I think what they've done is they've -- there are -- people in America have a lot of frustrations about government, they have a lot of frustrations about regulation. You talk to these people -- I've talked to Tea Partiers who own hardware stores and restaurants and they're upset about things like health inspectors and ADA inspectors and these little nuances that they see as being government intrusion, but they conflate that with regulation of these giant banks like Goldman Sachs and JPMorgan/Chase and they think it's the same thing. And what they've managed to do is convince all these Americans to campaign for deregulation of these massive companies under the banner of, "let's get the government off our back."

PARKER: But the Tea Party's actually doing the work, the legwork for the big banks, how does that happen? How did they not know that that's what they're doing? TAIBBI: Well, I think it was an organic process. I mean, people who say that the Tea Party isn't a grassroots movement, I think, are incorrect. I think in some respects, it is a grassroots movement. They were organized around a lot of local issues, but there were also powerful interests, the Koch brothers and other financiers, once they saw this movement happening, were more than willing to push it along and give it the energy and the resources that they needed to spread around the country.

SPITZER: You know, again, I want to quote you, because I think your words are just so good, and it comes to the title of the book, you say, and it comes back to what you just mentioned -- "There are really two Americas, one for the grifter class and one for everyone else. In everyone else land, the world of small businesses and wage- earning employees, the government is something to be avoided. In the grifter world, however, government is a slavish lap dog to the financial companies that will be the major players in this book use as a tool for making money."

Describe these grifters, the Goldman Sachs the JPMorgan/Chases and how they manipulate government to really use it to squeeze money out of the middle class.

TAIBBI: Well, I mean, a classic example is right after September 2008, a lot of these companies were going belly up and Morgan Stanley and Goldman Sachs, they apply to the government for an overnight change in status from investment banks to they become commercial banks overnight, which allows them to essentially collect money from the fed at zero percent interest. And a lot of these banks turned around and they took money at zero and they lent it right back to the government at three...

SPITZER: When's the last time anyone else in the world called up a government bureaucrat at 5:00 and said, I need an answer, and got it by 7:00 the next morning?

TAIBBI: Right, right. And not only that...

SPITZER: And a check for $20 billion.

TAIBBI: And a check for $20 billion. I mean, the law mandated a five-day waiting period, which is nothing, already, and they got it overnight on a Sunday night, these banks. They called up on a Sunday night and they got the change the next morning.

SPITZER: But to come back to the point that you so eloquently describe. The moment the banks got their money, they suddenly persuaded the Tea Party to start rallying for shutting down the government's ability to help anybody else, not a single mortgage person whose house was underwater had a bankruptcy judge sort of to undo the mortgage because the Senate forbade that and the banks lobbied against it. What was going on here?

TAIBBI: Well, again, I just think that there was this enormous sentiment against government intrusion and after Obama got elected and they had the stimulus and the homeowner Affordability Act, ordinary people had not seen the bank bailouts. They didn't actually see that happen. They didn't see the trillions of dollars that went to Goldman Sachs and JPMorgan/Case, but they did see these programs that went to minority homeowners, poor minority homeowners, their next-door neighbors. And when they saw the government bailing out those people, that's when they got angry. And again, they confused the two issues.

PARKER: But you do make a -- you're very generous in acknowledging that there are legitimate grievances, people have legitimate grievances against local and state governments, but your point is that they shouldn't conflate that with things...

TAIBBI: It's a completely -- two completely different worlds. The world of, you know, the small business owner who has to deal with small government intrusions, these small regulations and this other world that exists in the stratosphere where Goldman Sachs and JPMorgan/Chase and other guys who are on the phone with these guys who used to work in their companies and they're basically making the rules of the game as they go along, that is something entirely deferent then what ordinary people do for...

PARKER: You make the case that Alan Greenspan and Goldman Sachs are criminals. I mean, you make a pretty strong case for that. Why are you the only person saying that?

TAIBBI: Well, I think I'm not the only person saying that, I think there are...

PARKER: Other than Eliot.

TAIBBI: Other than Eliot, maybe. I mean, Greenspan is a separate case entirely, but clearly the banks during the mortgage bubble we were engaged in a massive fraud scheme that was essentially designed to take subprime or very risky mortgages and pawn them off on other people as AAA rated investments. This was something they did with their eyes wide open and it was a catastrophe for the entire world, basically, and nobody has gone to jail for this and instead, we're blaming the people who actually borrowed these mortgages and they're the villains in the crisis.

SPITZER: And it gets worse because the fed that Greenspan chaired that Tim Geithner ran in the New York fed, had direct responsibility for overseeing this entire complex relationships, direct statutory responsibility and Geithner, when he was being confirmed by the United States Senate said, "I've never been a regulator," an outright silly, false statement. And so they completely claimed lack of responsibility when they were at the vortex of every piece of this.

TAIBBI: It even got worse than that, Alan Greenspan was actually encouraging ordinary Americans to take out option ARM mortgages. They were actually saying, he was actually saying that fixed 30-year mortgages were sometimes a bad idea, and that people could get more value out of option ARMs, which ended up blowing up the universe. When America's biggest regulator makes suggestions like that, it has a lot of weight. SPITZER: Now, you spent a lot of time with the Tea Party folks and you kind of are tough on them, but you understand -- to quote our former president, you "feel their pain." How do you get those pitchforks directed in the right direction again?

TAIBBI: Well, it's very difficult. I think you have to try to -- what I'm finding, as I travel the country, is that more and more people actually do understand what happened. And the reason that they understand is because they are personally confronting some aspect of the financial services industry, whether it's because, you know, I met somebody in Kentucky a little while ago who lost 20 percent or 30 percent of his pension fund value, because the state had invested in mortgage-backed securities, or whether they'd been wiped out by credit card debt or they're being foreclosed upon, people are being forced to get an education in all these things and they're slowly coming around to what happened in the last 10 or 15 years, but it's a very, very gradual progress.

PARKER: Well, you said that when you were at the Republican convention, last time around, you were unaware that in two weeks the whole economy was going to collapse and everybody else was unaware, because we just weren't paying attention. But you also talk about seeing Sarah Palin up there on the lectern and saying -- you were sort of prepared to kind of be bored and walk out pretty quickly and try to find your car, right? But instead, something else happened, you saw this person who was saying amazing things. How do you see her role now in our culture and our political environment?

TAIBBI: I have the same reaction to Sarah Palin when I saw Barack Obama speak for the first time in person. I said, this is a gifted politician, this is a person who has the ability to connect with people on an emotional level, beyond even what she was saying. The words of her speech, the effect went beyond that. And I think that that's continued to be true, despite a lot of the, you know, the missteps that she's made in public. She continues to connect with people on an emotional level. She brings out these crowds, and I think that she obviously has a big future in presidential politics. It just remains to be seen what she's going to end up standing for.

PARKER: But you talk about the class warfare that she's created. That's a big negative, don't you think, for our country?

TAIBBI: Well, I was very struck in her speech about how she talked about how she was from a small town and the small towns are where people do the most work. And there was this emphasis in her speech...

PARKER: We don't work in New York at all.

TAIBBI: Right, right. It was all about, there are people who do work and then there's this other group of people who apparently don't work and these people are carrying the weight for these people. And that ended up being a prominent theme in the Tea Party mythology that they're carrying the taxes, they're carrying the water, and somebody else is drinking the water and she was very, very skillful in presenting that message. PARKER: And who are those somebody else's who are drinking the water, as you say it?

TAIBBI: Well, they never say it, but it's pretty clear that they're talking about low-income and usually minority people, and immigrants, who are taking up most of that burden.

PARKER: Are they vampire squids?

TAIBBI: No, but that's what's so amazing about it, is that this mythology came at a time when we were giving what, $9 trillion, $10 trillion to the banking sector out of the public's pocket and that wasn't what they were complaining about.

SPITZER: And that is what mystifies me. Why has no politician, Barack Obama or even a Dennis Kucinich or a Senator Feingold or Barry Sanders, so many that are really smart -- or Carl Levin -- stood up and explain, wait a minute, the guys who are really sucking the blood out here are Wall Street and so let us redirect that and then claim the allegiance of that universal people who compromise the Tea Party and say, here is whom you should be angry at.

TAIBBI: Yeah, no, absolutely. You know, after the financial crisis in 2008, after Barack Obama got elected, I heard from a lot of people on Wall Street, who are sources of mine, who said, "Where are the Democrats? Where's that politician? This is a teaching moment. This is an opportunity for the politicians of our country to say, 'this is what's been happening in the last 10 or 15 years. You've been getting screwed over by these people.' And nobody stood up and did that." Instead, I think the Democrats kind of took the fork in the road and they tried to save Wall Street and communicate to their voters at the same time. It just didn't work.

SPITZER: They were co-opted and became the voice of the status quo.

TAIBBI: Right.

SPITZER: Last question I got for you, who are your heroes? Is there anybody in this process where you can say, look, there's somebody who's doing it right, who's trying hard? Is anybody kind of speaking for the public?

PARKER: Basically, we see that you don't really like anyone.

(LAUGHTER)

TAIBBI: Well, clearly, governor, you were one of my heroes...

PARKER: Uh-oh.

SPITZER: Thank you, but that's not why I asked the question.

TAIBBI: No, but I mean, there were politicians in this process who were standing up, I mean, Ted Kaufman of Delaware was somebody who was a great help to me. I mean, I need people to explain a lot of this stuff to me and it was people like Ted Kaufman, Bernie Sanders was another guy. There were a lot of people on Wall Street who just were ordinary traders who called me up and helped me out. I think there are -- there's an opportunity for politicians out there, and there are a few of them, Sherrod Brown, Ron Merkley, who are trying to do the right thing, but it's just a very, very, it's a uphill climb for politicians in this climate.

PARKER: All right, well, thank you so much for being with us. This is fascinating. Appreciate your coming.

TAIBBI: Thank you very much for having me.

SPITZER: Keep using those metaphors. We love them.

SPITZER: We'll be right back.

PARKER: Look out for the vampire squid.

(COMMERCIAL BREAK)

SPITZER: And now it's time for "Fun with Politics." There's been a revolution of the polls, only not in America. A British court has thrown out the results of a parliamentary election. The court decided that the winning candidate had gone way too far in distorting his opponent's positions.

KATHLEEN PARKER, HOST: And no, it's not a Monty python routine. The court actually ordered a new election and banned the lying politician. That's kind of a redundancy, isn't it, Eliot?

SPITZER: Oh, come on, (INAUDIBLE) my friend.

PARKER: Banned him from serving in the parliament for the next three years. God save the queen.

SPITZER: God to love those Brits, Kathleen. The message is clear, you lie, you lose. And what would happen if that rule applied on this side of the pond?

PARKER: Well, I don't know, Eliot, but if this thing catches on over here and court starts tossing out the liars, pretty soon the Congress might look like this.

SPITZER: Wouldn't be such a terrible thing.

PARKER: Don't go away. We'll be right back.

(BEGIN VIDEO CLIP)

PARKER: George W. Bush said, do you miss me yet? And, of course, now that the former president's out with his new book, so the question, do you miss him?

ROBERT ZIMMERMAN, DEMOCRATIC STRATEGIST: If I was a professional comedian, I would miss him. I mean, let's be realistic about this. I mean, let's remember in this midterm election, both parties campaigned aggressively against the Bush administration's record, Republican and Democrats. Of course, the irony for my part is the country voted to give the Republicans a second chance to prove themselves. But the administration, the Bush administration's legacy is one of criminal negligence and --

KELLYANNE CONWAY, REPUBLICAN POLLSTER: Oh, goodness. What do you mean by that?

ZIMMERMAN: What I mean by that.

JUSTIN GIMELSTOB, THE TENNIS CHANNEL: Can we agree that it's an impossible job? Can we agree with that?

(END VIDEO CLIP)

(COMMERCIAL BREAK)

SPITZER: Welcome to "Our Political Party," a chance to speak our minds in a whole range of topics. Let's meet our guest, Justin Gimelstob, a former professional tennis player, sports broadcaster, and now a marathon runner.

Justin, I understand, there was money on the table when you ran the New York City marathon yesterday. Where did that come from?

JUSTIN GIMELSTOB, THE TENNIS CHANNEL: All for a good cause. Andy Roddick who's a good friend of mine and beat me in everything in life. As a matter of fact, he retired me at the U.S. Open in 2007. So we established this wager to raise money for charity, give me a platform to raise money for the Justin Gilmelstob's Children's Fund which raises money for a local pediatric cancer hospital. Andy does tremendous work for philanthropy.

SPITZER: Right.

GIMELSTOB: And the bet was to run under four hours and 45 minutes.

SPITZER: And you came in at?

GIMELSTOB: Four hours and nine minutes.

PARKER: Congratulations.

GIMELSTOB: Thank you.

SPITZER: And you're here today.

GIMELSTOB: Every single part of my body hurts, except my vocal chords. The only genetic and superior muscle in skill I have in my body. It was an amazing experience in New York. We all know New York is an amazing city. Quite contentious, but to see everyone come together, there's so much love and energy.

KELLYANNE CONWAY, REPUBLICAN POLLSTER: Did you passed Pena, the Chilean miner? GIMELSTOB: I did. I ran with him for a little bit and passed him. He was incredibly inspirational. But there are so many amazing stories. People are hurting. They're stopping to help others along the way. The volunteers, the police, the way the city comes together, it's really a -- it's a tourism board of New York.

SPITZER: As a tennis fan, I want to say, thank you for your great matches. It was always a joy to watch you.

GIMELSTOB: You obviously benefit from low expectations. I appreciate that. Thank you.

SPITZER: No, just good tennis. And Robert Zimmerman, a media consultant, member of the DNC, Democratic National Committee. And no, he is not Bob Dylan, even though Bob Dylan's real name was Robert Zimmerman.

ROBERT ZIMMERMAN, DEMOCRATIC STRATEGIST: It ain't me, babe.

SPITZER: We were going to ask you to sing until we found out it wasn't you.

ZIMMERMAN: But he's an incredible dresser. We've all been talking about how he matches --

GIMELSTOB: Talk about low expectations.

PARKER: Yes. We're never going to get to my side of the table. Come on. Over here on this side, we have Kellyanne Conway. She's a Republican strategist and CEO of the Polling Company, a research and consulting firm. And Robert Verdi, who is a style expert and host of "The Robert Verdi Show" on the Logo Channel.

Welcome, everybody.

SPITZER: Well dressed too.

PARKER: Yes.

GIMELSTOB: I hope we can all get a pair of those glasses.

PARKER: That's right, but you have to shave your head. You have to shave your head.

Our first question for the party is, you know, a few years ago, Minnesota -- well, it wasn't that long ago, a Minnesota businessman put up a big billboard -- I've always wanted to do that.

SPITZER: All right.

PARKER: George W. Bush, said, "Do you miss me yet?" And, of course, now, the former president is out with his new book. So the question is I think I'll go with Kellyanne first, do you miss him?

CONWAY: I'm glad to see he's back on the scene. I'm glad that he hasn't butted into the Obama administration. He's been purposefully silent and not even sort of giving blind quotes to the media and trying to pick on the successor, even though the successor's pretty down now. President Bush, right before his party took a mini shellacking in 2006 and lost 30 seats in the House, his approval rating was 63 percent. Last week, the president's party lost more than 60 seats and his approval rating was in the mid-40s. So I think that all these ex-presidents have a voice. I notice that George W. Bush's advance was one-half of what Bill Clinton's advance was. They all have the right to write a book. I want to see who gives the money to charity.

PARKER: So you work for Republicans. Am I right?

(LAUGHTER)

GIMELSTOB: How does his advance compare to Andre Agassi's book offer?

CONWAY: Seven million bucks. Seven million bucks. Even Jimmy Carter, you know, for a president, he's been making the rounds recently. I think former presidents are a unique and small class and they ought to have a voice. We ought to respect that, without too much cackling.

PARKER: I agree with you. I agree with you.

ROBERT VERDI, FASHION EXPERT: Where's he been all this time, though?

CONWAY: On his ranch.

UNIDENTIFIED MALE: He's looking for weapons of mass destruction on his ranch.

PARKER: He did make a decision that he was not going to interfere with the next president.

UNIDENTIFIED MALE: We have to respect that.

PARKER: And I think that's --

ZIMMERMAN: Because he had no credibility and nothing to contribute.

PARKER: Oh, come on. You must work for Democrats.

ZIMMERMAN: I support Democrats. But do I miss him? If I was a professional comedian, I would miss him.

I mean, let's be realistic about this. I mean, let's remember in this midterm election, both parties campaigned aggressively against the Bush administration's record, Republicans and Democrats. Of course, the irony from my part is the country voted to give the Republicans a second chance to prove themselves. But the administration -- the Bush administration's legacy is one of criminal negligence, and --

CONWAY: Oh, goodness. What do you mean by that?

ZIMMERMAN: What I mean by that --

GIMELSTOB: Can we agree that it's an impossible job? Can we agree with that?

ZIMMERMAN: No. When you invade a country under false pretenses, send our soldiers into battle without the proper equipment, when they come home, don't give them proper health care, not to mention destabilize the Middle East and empower Iran, that's a situation where --

CONWAY: Joe Biden voted for that war, and now the secretary of state and the vice president, and your man, Barack Obama, won the Democratic primary but saying I'm the only one who's against the Iraq war. I'm going to get the troops home.

(CROSSTALK)

GIMELSTOB: Kellyanne, it should be an interesting book. It will be interesting to see how he came to his decision making process.

I don't want to take away my compliment of --

ZIMMERMAN: If I want to read great fiction, I'll read Barbara Taylor Bradford, not "Decision Points."

VERDI: I echo Robert. I agree. I don't miss him. I do think that I would label it criminal negligence as well. I think that --

PARKER: This is not a fun party.

VERDI: You know, in --

(CROSSTALK)

UNIDENTIFIED MALE: Criminal is over the top.

SPITZER: Here's what I think we should do. I think we should all read the book. Maybe borrow -- don't buy it, don't give the money. Borrow it, then we can reconvene.

CONWAY: I'll buy Robert a copy.

UNIDENTIFIED MALE: Thank you, gentlemen.

SPITZER: I sympathize with what the Roberts are saying, because when I look at -- as a policy matter, that administration took this nation down a path of despair and destruction and falsehood. And having said that, I think he is a great decent individual and I think we can separate the two. And as much as I just thought he was a horrendous president, whenever I interacted with him, there was a decency. And I don't think he meant to do these things. And so I think, let's view --

PARKER: Well, there was a lot of bad intelligence at the time, by the way, and everybody thought that Saddam Hussein had chemical weapons. And they did.

GIMELSTOB: Hindsight, it's always easier after the fact.

PARKER: And I wanted the former president to come on our show and talk to us about his book, so --

(CROSSTALK)

GIMELSTOB: Undeniable that is one of the most unique families in our country's history. I've been to their house in Texas. I mean, the father, the son, the CIA --

UNIDENTIFIED MALE: What are you doing --

GIMELSTOB: They're incredibly hospitable.

PARKER: They're lovely people, they really are.

GIMELSTOB: There's a professional tennis tournament in Houston. They invited us all there, and they're incredibly hospitable. They love tennis. President Bush plays tennis. And they were just very generous in spirit. There are pictures all around the house --

SPITZER: All right. We're going to move away from President Bush.

GIMELSTOB: So we're pro-Bush, we agree. We're pro-Bush.

(CROSSTALK)

SPITZER: A bruising, bruising public battle, kind of like President Bush, another charismatic public figure, maybe charismatic not so much, was left on the sidelines wondering if he could ever come back. He comes back tonight with his own TV show, what politician -- can Barack Obama, rather, can Barack Obama come back the way Conan O'Brien has?

VERDI: Absolutely, 100 percent. Because I think that the quality that Conan has that Barack also has is that he's very likable. He's personable. And I think that we also, as a culture, we like to build people up, knock them down, and then forgive them and help build them back up again.

CONWAY: Well, Obama is likable, but not as he said to Hillary during the primary, not so much anymore. Because when they look at a president, they ask themselves, number one, do I like you? That's a living room (ph) test. Do I want to really see you and have you be my leader for the next four to eight years?

The second question is more important. It's are you like me? And I think Obama really had that connective tissue with many Americans who're clinging independents, women, seniors all of them voted against his party last week because he's lacking that connection now. The "are you like me" people want to feel like you empathize. They want to feel you're not so detached or so aloof. And I think that's part of his personality. I think his detachment allowed the country to feel like there was going to be calm after the storm, but now it makes them feel like, you know, doesn't anything ever get you nervous or upset? Don't you react somehow the way I do to things?

GIMELSTOB: Well, that doesn't bode well then for Conan, because he's a bit out of the ordinary. He doesn't necessarily connect with the mainstream audience.

SPITZER: But he is fun.

GIMELSTOB: Not a lot of people look like him or act like him. He does a great job, but we can't feel too bad or have too much empathy for someone who got paid $22 million or $24 million not to work for a little bit, just to get another deal.

UNIDENTIFIED MALE: Exactly.

ZIMMERMAN: But you know, it's an unfair comparison. I mean, realistically, one guy is on TV every night, and then there's Conan. It's, you know --

GIMELSTOB: One is on TV four times a day and one's on once a night.

ZIMMERMAN: Awesome. Good comparison. But the reality is, I think President Obama can come back. Because, you know, every great champ gets knocked down once or twice, but the real winners are the ones who know how to come back and regroup. And I hope for the sake of our country that he does.

CONWAY: Obama's big problem right now, guys, is that you already see a lot of these blind unattributed quotes from senior Democratic officials or Democratic members of Congress. Those are the people who helped him win. You've got a lot of seat party chairs according to "Politico" today really upset with Obama for sort of ignoring them.

ZIMMERMAN: The quotes we were seeing from Tea Party members against the Republican establishment and the Republican establishment against the new members of Congress gives us some hope politically for the future.

CONWAY: They're trying to figure out how to work in a majority, Robert.

GIMELSTOB: But isn't one of the problems where Obama that he's benefiting from such unrealistic expectations.

VERDI: It's like a celebrity president is a little bit disturbing. He does have one thing in common with Conan, which I think is probably the most impressive thing. They've both been on the cover of "GQ."

SPITZER: Oh.

PARKER: Well, there you go. We have one last quick question. The pundits have been talking about this last election using some fancy words like cognitive dissonance and hubris. Yes. So going back to your grad school days, you all went to grad school, right? What -- undergrad.

GIMELSTOB: I'm still working on my undergrad. It's a working process.

PARKER: What word would you use to describe what happened to the Democratic Party?

GIMELSTOB: Predictable, I think, with what's happened at the midway point. And it'd be nice -- I know it's Pollyanna and Utopian, it would be nice if we could all just work together under a common goal to help bring our country back to the forefront.

PARKER: You've still got those endorphins coursing through your body.

GIMELSTOB: I said Pollyanna. And you're right, I do have the spirit of the love, not quite the political angst that some other people to my right have.

ZIMMERMAN: Yes, angst is a good word. But I think the phrase I would use would be maybe mandate interruptus.

PARKER: Yes. That's a common affliction of presidents.

ZIMMERMAN: We got our butts whipped, OK?

(CROSSTALK)

CONWAY: I studied some Shakespeare and I would say, me thinks they doth don't get it.

SPITZER: That's quite editorial.

CONWAY: That's right. And caveat emptor, buyers beware. Because I think, you know, people talk about buyer's remorse. I think it's on to full-on product recall at this point for the Democrats.

SPITZER: Oh, my goodness.

GIMELSTOB: Retirement gift, my 9/11 turbo (ph), so if anyone wants one of those, I really --

(LAUGHTER)

PARKER: All right, Robert.

VERDI: I think it's less about what has happened to the Democratic Party and more about how you perceive what happens to the Republican Party in this particular situation, which I'm going to describe as supercalifragilisticexpialidocious.

(LAUGHTER)

SPITZER: Look, we've got a quick break. Before we do, Kellyanne, I just have to say one word -- jobs. If the economy comes back, Barack will go down as a great president who gave us health care, who restructured financial services. If the economy comes back, all is forgiven. If it doesn't, he's a one termer.

PARKER: You're right,

CONWAY: I have a word, a four-letter word for Barack Obama

PARKER: I just want to say chasm.

SPITZER: Chasm, all right.

SPITZER: All right. We've got to take a break. We want to hear from you. Check out our blog at CNN.com/parkerspitzer. Follow us on Facebook or Twitter. We'll be right back with another question.

(COMMERCIAL BREAK)

PARKER: Welcome back to "Our Political Party." Let's squeeze in one more quick question.

President Obama may have to cancel his trip to Indonesia because of volcanic activity. If that happens, what will the headline on FOX News be?

VERDI: "Obama flees burning hole."

(LAUGHTER)

PARKER: Whoa!

ZIMMERMAN: How about this? How about this? Trying to channel Sean Hannity is not easy, but how about this, "Volcano erupts, $200 million up in smoke."

PARKER: Not bad. Not bad.

GIMELSTOB: Aren't we giving him a little bit too much credit. Natural disasters, even the president of the United States can't control. You know, we've had volcanic ash, it's a brutal situation. If you can't travel, you can't travel. Maybe we shouldn't speculate on what maybe FOX will or might not --

CONWAY: FOX News Channel will be fair and balanced and they will say that "Volcano erupts, forcing president to cut his trip short" and then maybe he'll fly over to Iraq and gets some troops out or make his first trip to Israel as president. But in the meantime, I think Keith Olbermann over at MSNBC will probably say once again, the president walks into a country and the earth shakes. And in this case a volcano even erupted. He walks the earth shakes. So, I think that's probably --

SPITZER: You're not suggesting MSNBC isn't right down the middle in its political commentary?

CONWAY: Well, no, and maybe I'll make a contribution to Obama --

(CROSSTALK)

GIMELSTOB: I am happy that Olbermann will be back on the air. He deserves to be back on the air and that --

CONWAY: Absolutely, I agree.

ZIMMERMAN: Kellyanne --

PARKER: We're grateful that Kellyanne is not on FOX payroll, because otherwise she wouldn't be here.

ZIMMERMAN: And Kellyanne, I just want to ask you. Do you agree with Michele Bachmann that the trip cost $200 million a day, even though that radical paper, the "Wall Street Journal" said it was completely bogus and false.

CONWAY: I don't know how much the trip cost.

SPITZER: Well, you know what?

PARKER: Robert, what about you? I forgot what the question was.

VERDI: I answered it, I think.

GIMELSTOB: I guess the question now is $200 million.

SPITZER: If you had $200 million to spend on a one-day vacation, where would you go?

PARKER: $200 million.

SPITZER: Well, you know, of course, yd say --

(LAUGHTER)

All right, Robert Zimmerman, Justin Gimelstob, Kellyanne Conway, Robert Verdi, thank you for being with us. We'll be right back.

(COMMERCIAL BREAK)

JOE JOHNS, CNN SENIOR CORRESPONDENT: Hello. I'm Joe Johns. More of "PARKER SPITZER" in a moment. First, the latest.

A Connecticut jury has recommended the death penalty for Steven Hayes. He's the man convicted in the gruesome home invasion murder of Jennifer Hawke-Petit and her two daughters, Haley and Michaela in 2007. Formal sentencing for Hayes is set for December 2nd. A second defendant is awaiting trial.

Elizabeth Smart testified today in a Salt Lake City courtroom about her indescribable fear when she was taken from her bedroom at knifepoint 8 1/2 years ago when she was 14 years old and raped. It was the opening day of the federal kidnapping trial of Brian David Mitchell, the man accused of abducting Smart. Smart was found nine months later.

And Andrew Shirvell, an assistant attorney general in Michigan, has been fired for targeting Chris Armstrong, the first openly gay student body president at the University of Michigan. Michigan's attorney general says Shirvell repeatedly violated office policies and engaged in borderline stalking. He says Shirvell engaged in his attack against Armstrong while at work.

Tonight on "AC 360," we'll hear from Deborah Bond. She's an attorney representing Armstrong. That's the latest. "PARKER SPITZER" back after this.

(COMMERCIAL BREAK)

PARKER: And now our postscript. President Obama used his trip to India this past weekend to let off some midterm steam. Take a look.

SPITZER: But it's nothing new for the president. We got our first look at his fancy footwork during the campaign when he stopped by Ellen DeGeneres' show.

PARKER: So it's not so surprising, Eliot, really that he was ready to have some fun. Since he was so far away from Washington, anybody would want to dance. But I still think he has a long way to go before he makes it to the level of this sophisticated dance by his predecessor.

SPITZER: Oh, yes, this is one of our favorites. That is a classic, Kathleen. But what about future presidents? We dug around and found this one, a dancing president in training. There's Ms. Hillary.

PARKER: OK, now. All right, then. All right.

Thanks so much for being with us. Be sure to join us tomorrow night.

SPITZER: Good night from New York. "LARRY KING LIVE" starts right now.