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Interview With Texas Congressman Ron Paul; How Bailout Bill Really Works
Aired October 03, 2008 - 15:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(BEGIN VIDEOTAPE)
RICK SANCHEZ, CNN ANCHOR (voice-over): Coming at you now: the bailout -- OK -- rescue or whatever they call it unfolding this hour, with cooperation and indignation.
REP. STEVEN LATOURETTE (R), OHIO: Where did $700 billion come from? The administration says, we didn't have a data point; we just wanted to pick a really large number.
SANCHEZ: Is it really do or die, as some suggest, for the American economy?
Wait until you see what else is in this deal: breaks for NASCAR, rum, wool. Wool? What does that have to do with banking?
UNIDENTIFIED MALE: If we are going to have some sort of deal there, it would be nice to get the money back into the hands of the people.
SANCHEZ: What do you say?
Also, who won the debate? We have a new poll.
Your comments unfiltered on Twitter, Facebook and more. Like nowhere else, your newscast starts right now.
(END VIDEOTAPE)
SANCHEZ: And here we go.
We are going to begin with breaking news as we start the newscast. This happened 12 minutes ago. But we at CNN can now report we have just learned and confirmed that the president is not waiting until he gets back from Crawford to sign this bailout bill.
He signed it as of 2:48. Again, about 12 minutes ago, the president signed this bill in the Oval Office. Think about how little time it took for the Congress to approve this thing, and then for the president of the United States to actually sign it, something he definitely wanted to do.
Let's go to some pictures, round robin here real quick. Let's get a shot, if we possibly can. There is the trio really of what is going on right now. There, you see the White House, where we were expecting the bill was going to be going to during this hour. But now we are learning he signed it, he's heading off to Saint Louis, the president, that is, and then he is going on to Crawford to begin a vacation.
Then, we see Capitol Hill, where much of the resolution was worked out, and where we expect to be hearing from many there who are going to be going to the microphone and telling us what they think.
And now we are looking at Wall Street as well. You will see it is only up 67. Many people thought this would really send the markets up, but it is not in fact doing that, which is quite interesting, because it is actually somewhere else.
Come back to me, Roger. The actual impact of this thing is not being felt there on the market. If anything, it is being felt in commodities. It's being felt on the trading floors in Chicago at the Mercantile. That is where it's being felt. That's where Ali Velshi is going to be joining us in just a little bit.
What does this have to do with you, you may be asking? I will tell you what it has to do with you. It has everything to do with whether you can now buy a car, maybe get another house, or get credit on a credit card. That is what we are going to be talking about. And we're going to be joining Ali in just a little bit.
By the way, I want to share something with you. This thing and we talked about it yesterday, and this is a very important point to make as we progress with this story. Remember, this thing started -- give me a shot here. This thing started with this many pages. Three pages is how this started, this bailout or rescue bill.
This is what it is now, 450 pages. So, obviously, any journalist worth his salt would ask, three, now 450? How did we get from that to here? What is contained in here that you as taxpayers need to know about?
We did a little homework here today at CNN and we found out. What it contains is a whole lot of pork. They are calling them sweeteners. They are things that were added to this bill, and here we go.
Roger, go ahead and run it. All right. We went through it a little, so I didn't give it the proper setup. You may have been surprised and confused about what you were seeing, but what you were just looking were all the people, all the entities that are going to be benefiting from this bill.
As a matter of fact, let me just go over a couple of these again. You ready? Wind power, solar power, disaster victims, college students, teachers, NASCAR racetrack owners, film producers, bicycle commuters, makers of Puerto Rican rum, makers of Virgin Islands rum, owners of plug-in electrical vehicles, investors in American Samoa, mine rescuers, worsted wool fabric producers, Alaska fishermen, and makers of wooden arrows.
Ron Paul joining us now to let us know what he thinks of this bill as we look at it. That, Congressman, is a heck of a lot of pork, isn't it?
REP. RON PAUL (R), TEXAS: It sure is. It is pretty amazing. You take a bad bill and make it a lot worse, and you get 57 members of Congress switching from no to yes.
So, that tells you something about Washington. There is really not hope, much hope for us here in D.C. to solve the problems, because it is just more of the same, more of the spending.
Dealing with this, there is a financial crisis and a credit crunch, but they are not dealing with the fact that this -- this country is bankrupt. And -- and we are on the verge of some really major events, but we are adding fire to the fuel there. We're just dumping kerosene on it and making this problem that much worse.
If debt is a problem, just think of what we have just done today. We have ballooned the debt like never before, putting more pressure on the Federal Reserve to monetize this debt, and print more money. So expect a lot more inflation in the future.
SANCHEZ: Do you think there was a reasonable alternative for this?
PAUL: Oh, absolutely. Doing nothing would have been a reasonable alternative.
But a reasonable alternative would have been to give some tax breaks and also regulate the Federal Reserve, the Exchange Stabilization Fund, the President's Working Group on Financial Markets. They need regulation, because they are working behind the scenes all the time to satisfy and take care of their friends and buddies.
So, those are the kind of regulations that we do need, but we should be enforcing contracts, not canceling out contracts, like they are doing in the mortgage market. But the most important thing that we should not be doing, and that is to prop up bad debt and malinvestment, because that only prolongs the agony and makes our problems that much worse.
SANCHEZ: Do you think that a lot of the politicians -- and I hate to use that word, but it is one that many Americans use when they look at you guys there in Washington -- really got this thing, really understood it? Because I have got to tell you, this is a really complicated deal, perhaps as complicated as anything that has ever been passed, right?
PAUL: No, I don't think they it's ideal, what is in the bill and what it does, and the unintended consequences.
But Warren Buffett said he had no really good understanding of the derivatives markets, and that is why he stayed away from them. So, if he has trouble understanding them, can you imagine the average member of Congress understanding the correction of the problems that have developed because the derivatives market is becoming unraveled? So, no, there is very little understanding of the nature of it, because there they are limiting their thoughts to a credit crunch, which means that some people have lost their credit rating. And that is good, because why keep loaning to people that don't have a good credit rating?
People who have good ratings can still borrow money and buy a car. People who have overspent and overborrowed, like the U.S. government, they are going to have trouble. And we are having trouble. But we have to deal with the nature of government and why we spend so much money.
SANCHEZ: Ron Paul, certainly a favorite on this hour. Every time we have you on, we certainly get a lot of people responding. And we will check some of those responses in just a little bit, when we go our Twitter board and MySpace and Facebook as well.
Let me show you two versions of what we were just talking about, because, during this debate on the House floor today, there were those who were adamantly against it, as Congressman Ron Paul is, and those who were not, who said, look, this is a necessary evil that we have to do.
Let's start with -- this is Steven LaTourette. He's a Republican from Ohio vehemently against it. Hear him out.
(BEGIN VIDEO CLIP)
LATOURETTE: Where did $700 billion come from? The administration says, we didn't have a data point; we just wanted to pick a really large number. Come on, $700 billion for NASCAR, rum, television, and wooden arrows for children.
(END VIDEO CLIP)
SANCHEZ: John Lewis is a Democrat from Georgia. Originally, he was against this. Now he is for it, maybe because some of the changes that we have just talked about. Let's give him a listen.
(BEGIN VIDEO CLIP)
REP. JOHN LEWIS (D), GEORGIA: I have decided that the cost of doing nothing is greater than the cost of doing something. The fear that is ripping Wall Street has the power to shut down Main Street.
We cannot and we must not allow this to happen. The people are afraid. Their retirement savings are slipping away. Small businesses have no sales, no credit, and are closing their doors. People cannot get loans. They are losing their lines of credit. We must act.
(END VIDEO CLIP)
SANCHEZ: Some of the other things that we're going to be talking about today, who won the debate last night, the vice presidential debate? We are going to be getting into that.
Also, we're going to be asking why is Ali Velshi in Chicago?
First, we told you what is going on with the credit market. He's going to be checking on that. The second part of it has to do with Oprah Winfrey. We're going to explain that to you.
And when we come, you heard Ron Paul's explanation, and now you're going to hear a Democrat's explanation on why this thing needed to be passed. We will have that for you. Stay with us. Back in just two.
(COMMERCIAL BREAK)
SANCHEZ: Two-six-six-eight-eight if you want to send me an instant message.
By the way, we are getting a lot of reactions from you, especially since we started just this last hour here at 3:00.
Johnny B. Goode, do me a favor. Go over to the big board over here. These are some of the comments that we are getting already.
Thanks so much, Zack. Let's go in tight on this one right here on the left side.
This is from Birdonwire55: "It is so packed with goodies," referring to the pork that we alluded to earlier in this newscast, "it is really sad. I hate that they did it. Dow is down to 57 on the news. Imagine that."
Let's look at one more here: "I think it is a necessary evil. To tell you the truth, Rick, I wish someone would start bailing out the less fortunate now."
And CheeseNRice cuts right to the chase. She says: "Let's be blunt and call a spade a spade. It is crap."
There you go. Welcome back now. I'm Rick Sanchez here at the world headquarters of CNN.
Before we do anything else, I want you to see Nancy Pelosi today the moment that the thing was being discussed. Remember last time, she was accused by some of the Republicans of being way too partisan. Check out how she behaved this time.
(BEGIN VIDEO CLIP)
REP. NANCY PELOSI (D-CA), SPEAKER OF THE HOUSE: Let us be clear. The original rescue bill proposed by the Bush administration was unacceptable, as has been indicated by Mr. Boehner. It has asked us to commit $700 billion in taxpayers' money with few strings and no safeguards. We rejected -- in a bipartisan way, we rejected that proposal.
(END VIDEO CLIP)
SANCHEZ: OK. All right, let's bring in a Democrat with a capital D now. That's Joseph Crowley. He's from -- a Democrat from New York, by the way.
Hey, let's put up the big board. Let's let him talk about this as well. Let's see what the final tally was. I understand it was 263 to 171, Republicans 108 nay, 91 for. So, they increased their number, but they were still generally against it. And the Democrats were 172 for, 63 against.
You like those results?
REP. JOSEPH CROWLEY (D), NEW YORK: I think they were great results. I thought it was a great vote.
But I also think, Rick, it was the right vote. I think, after a couple of days, people went back to their district. They heard from their constituents. I think they heard a lot more than they were hearing prior to the first vote. So, I think that had a tremendous impact on their -- on their second vote here.
SANCHEZ: You know, I was just talking to Ron Paul. He is diametrically opposed to everything that you are saying. He is saying, look, this is a huge mistake, that we are doing this the wrong way, that there's no such thing as trickle down, and that we will be paying for this for years. What do you say to him?
CROWLEY: Well, I look at this, Rick, not from Wall Street's perspective, although I'm from New York, not from a Manhattan perspective, but from a Woodside, Queens, 65th Street perspective.
SANCHEZ: OK.
CROWLEY: And, from there, it's about my mom and people like her who have invested in 401(k)s and their savings, people who are looking at their pension plants or their estate plans and seeing a real dip.
And my fear was not that we were going to do something. My fear, Rick, was that we would do nothing. And, instead, my fears were allayed aside because of the action we took here today.
I think we are sent here to lead. We're not here to sit back and let things happen. I think, from time to time, as in the past, government needs to step in and really bring some calm to the situation.
SANCHEZ: But let me ask you a question that I think I would be foolhardy not to ask. I am holding here 450 pages. Look at the size of this thing.
And, now, look at the size of what this thing started as, right, three little pages.
CROWLEY: Yes.
SANCHEZ: And now I start looking into this, and I find out that there's all kinds of earmarks and pork in there.
I mean, look, Congressman, we are giving stuff to people who invested America Samoa in this, to mine rescuers, to worsted wool fabric producers, to the makers of wooden arrows. I can go on and on.
CROWLEY: Right.
SANCHEZ: What has that got to do with saving the banks, man?
CROWLEY: I think, if you look in the overall package, a number of the things that were included in this bill, including the -- fixing the alternative minimum tax ,was something we were going the do anyway.
I think the tax extenders were something that we were going to do anyway. Many of the -- of what you are calling pork were included in the tax extenders. We are just extending them already. And I think...
(CROSSTALK)
SANCHEZ: But, you know, even if you do have a good explanation, and this is something you were going to do anyway, it just doesn't look good to stick it in this particular legislation. Could you have done it separately or something?
CROWLEY: Well, we always could do it separately. I think the question is whether or not we could have gotten a vote per se in the numbers that we got today.
I don't know if it was because of those add-ons or was it because of the FDIC raising the limits from $100,000 to $250,000. I think there were a number of things that changed, one may argue cosmetically, to bring us from where we were Monday to where we are today. At the end of the day, the bottom line is, the bill did pass, and it passed with bipartisan support and overwhelmingly. And I think that is what is important.
SANCHEZ: We thank you, Congressman Joseph Crowley.
CROWLEY: Thank you, Rick.
SANCHEZ: We appreciate you taking time to talk to us, sir.
CROWLEY: Thank you.
SANCHEZ: There is a part of the story that is extremely important and it has to do with credit.
Ali Velshi makes the case for us. In fact, he is going to the very place where this is taking place right now. This is about your credit card. This is about your bank statement. This is about a lot of things that affect your life. There's Ali. He is gearing up. We are going to be hitting him in just a little bit.
So, stay with us, because he's going to tell us what is going on with the credit market and whether you're going to be able to buy a car in the next month or not.
We will be right back.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: All time for debate has expired. Pursuant to House Resolution 1525, the previous question is ordered. The question is on the motion by the gentleman from Massachusetts. All those in favor say aye.
CONGRESS MEMBERS: Aye.
UNIDENTIFIED FEMALE: Opposed say no.
CONGRESS MEMBERS: No.
UNIDENTIFIED FEMALE: The ayes have it.
REP. BARNEY FRANK (D), MASSACHUSETTS: Speaker...
UNIDENTIFIED FEMALE: The gentleman from Massachusetts.
FRANK: Madam Speaker, I call for the yeas and nays.
UNIDENTIFIED FEMALE: The yeas and nays are requested. Those favoring a vote by the yeas and nays will rise.
(END VIDEO CLIP)
SANCHEZ: There you go. And, with that, they seal the deal, but not all Americans are excited about this.
As a matter of fact, some people are particularly angry, because it has passed and others because of the pork inside of this. We are probably as connected as any newscast to you, listening, reading what you are sending us as you do.
Johnny B. Goode, take me over to the Facebook screen, if we can. There's the big board. I am going to read what some folks are saying.
This came in from Christopher Dawson just a little while ago. He says: "No accountability. Once again, the baby boomers pass the buck to keep the ride going. Worst generation ever."
Now, let's talk about the pork if we possibly can. Go over to the other screen if we can -- that would you, Zack, right, on the camera. Go over there to the big Twitter board screen.
Alanc says: "I hate pork. If possible, please post each pork item and why it was added, i.e., I will vote yes if you give me this."
Also, we have: "Pork touted as a deal sweetener. Wooden arrows was ideal sweetener? Ploy to get something else with an emergency package." Let's do one more, if we can. "Were all of these pork pieces in the Senate version of the bill? And how did our candidates vote?"
This is reaction coming in to some of the reports that we have been giving you since we started this newscast, that there were that many earmarks contained within this thing.
I want to show you something now, because there is another part to this story that really needs to be paid attention to. And that is the credit crunch. It is a valid part of the story. So, we decided to send one of our crew members on our staff here to a car agency here in Atlanta, and ask to see how much business they were doing, how hard it was these days to sell a car or buy a car.
You are going to watch this with natural sound. No one is going to be telling you anything except the people who work there. Here it is.
(BEGIN VIDEOTAPE)
CESAR SALAZAR, SALES CONSULTANT: The banks are being a little more restrictive when it comes to giving out the credit. So it puts a little more -- it makes it a little more difficult for us to get it structured. Instead of speed-dialing something in half-a-hour, the deal is two, two-and-a-half, sometimes three hours. Sometimes, we have to send the customer home and tell them we will call them back once the bank actually gets back to us.
WESLEY WATSON, CUSTOMER: Yes, it's a lot different. It seems like more harder to draw it down when I got one like four years ago. And, last year, you know, like I said, I would be in and out by now. So, it is a big difference.
DEREK JACKSON, GENERAL MANAGER: Business is tough right now. The automobile business, as everyone knows is struggling. And, yes, it has affected business. It happens everyday. It happens everyday that we would get a customer that could have bought a car a year ago, and now they can't.
(END VIDEO CLIP)
SANCHEZ: Our thanks you to Don Jackson Motors in South Atlanta for taking us through that.
By the way, here is how this works. Here is what is going on right now, just to make this as concrete as we can. Four months ago, if you had gone to buy a car and your credit score was, let's say, 650, just to pick a number -- I'm not trying to be real specific in numbers here -- I know they change -- there is a chance that you would have been able to get one of the best rates out there.
Today, you need to be into the 700s, maybe 720, maybe 740, maybe 750, so it is harder to get a loan.
Ali Velshi joins us now with the response to what exactly it is that we are talking about this, and he is in the place where he can explain this to us.
Pick it up from there, Ali. I need to say no more.
ALI VELSHI, CNN SENIOR BUSINESS CORRESPONDENT: Yes. That was exactly the perfect starting point.
One of the reasons I am here at the Chicago Board of Trade, which, by the way, has emptied out. It finishes trading now. And the New York Stock Exchange is still trading.
One of the reasons I am here is this is where credit is traded, bonds, treasury bonds. And that is where large institutions and businesses trade money. And some of that had come to a short -- a standstill, particularly short-term lending.
Now, the problem with that is most people didn't understand how that connects to them. But you just gave one perfect example. The most direct link between a shortage of short-term lending and you is your ability to get a loan, a car loan, a student loan, a home loan.
There's another connection. If you are trying to sell your house to get out under some burdensome mortgage, but the person who is trying to buy it can't get that loan, you can't sell your house. House values start to drop.
There's a third connection. Short-term lending is something that businesses small and large depend on in order to make some of their operating expenses, salaries, supplies, things like that. That means some people were in danger of not getting paid. Some small businesses that supplied larger businesses were in danger of not getting paid.
Now, what we have here an indication after this bailout plan from some of the traders on the floor that the most immediate indication of this credit freeze coming unfrozen started today after this bailout plan. It was very, very small, but there was a little bit of a drop in the cost of short-term lending for major institutions.
That is not going to hit the person buying the car just yet, because there is no new money in the system, just some of this frozen money is coming unfrozen. A bunch of squirrels herding their acorns. Now that is starting to come out.
So, the reaction, we don't know, Rick, how quickly the reaction will make it to the individual credit markets, but the bottom line is, we are starting to see the right direction as a result of this bailout bill being passed -- Rick.
SANCHEZ: Darn good explanation. We get it. We get it. Essentially, the problem was, people couldn't get their hands on money because the folks at the top couldn't get it and now eventually we might see that go the other way, although, and I will guarantee you will agree with this, there are no guarantees, right?
VELSHI: Absolutely. And that's why, even after this, you look at the Dow, it's still down. Why is it down? Shouldn't the market be celebrating? You don't know what happens in this environment. SANCHEZ: Right. All right.
But there is another side to this. Hey, thanks so much, Ali.
There is another side to this story that frankly has teed off a lot of people who watch this newscast everyday and it has to do with the fact that this thing started with three-and-a-half pages; now it is 450 pages and within that 450 pages is a whole lot of stuff that they didn't agree to, pork. We have a specific list of what is in it. Here it is. Let's run through it one more time. Let you enjoy it. Those are the people who are getting a tax break as a result of this particular package, and it is fascinating when you look at something like that.
Taxpayers for Common Sense, those are the folks who look at this type of stuff, study it, and I understand get pretty angry about it.
She is likely angry about it as she watches that video that we showed moments ago. And she is Ryan Alexander with Taxpayers for Common Sense.
What are people to make of that when they are told that they are going to be getting a relief package, rescue package/bailout package, because the financial institutions need help and then they end up with something that has -- count them -- 16 different items that are also being put in there as earmarks?
RYAN ALEXANDER, TAXPAYERS FOR COMMON SENSE: You know, I think we are hearing a lot of what you guys are hearing on your Web site and on your Twitter pages and Facebook pages, that people are angry about this.
People want to see a clean vote on what was a historic bill. No one was happy about $700 billion being spent to rescue Wall Street. No one wanted to see their hard-earned tax dollars go to bail out bad debt by bad actors. But at the same time, just as your piece indicated, they want their kids to get car loans. They want to be able to still have a retirement.
SANCHEZ: But go back to the pork thing, because you guys study this, and you look for this all the time, and you try and hold the rascals accountable.
We look at it from time to time, but we also cover a whole lot of other different stories.
ALEXANDER: Sure.
SANCHEZ: So, I guess my question is, how common is this? Is this something that happens all the time? Do they even care that we are looking and saying, why did you do this?
ALEXANDER: I think this happens a fair amount.
I think there are a few things that happened in this. First, the Senate rolled up a bunch of pending legislation and kind of put it on the bailout bill as, this is the last the train leaving Washington. We want to get on the road and start campaigning for our reelection, and we want to go back and talk to our constituents. And they just rolled it all up together.
Did they do that because they had to do that to get votes? That is going to be the thing that is hard to tell. And if they did, that raises real questions for a lot of taxpayers. Did you really need to give a tax break to the wooden arrow manufacturers? Did you really need to give the race car track subsidy to get people to vote for this bailout bill?
A lot of people changed their votes today. We're not going to know exactly why they did. I think the biggest reason is the stock market crash, not because -- from Monday -- not necessarily because of the pork.
SANCHEZ: And you know what it is interesting? When you look at these things individually, I have got to tell you, I started studying some of these things to figure out whether they really were necessary. And some of them make perfect sense by themselves.
This is for teachers who, for example, buy supplies from their own money for their students, and they are going to get some money back so they can do that. There's other examples of this in here where you say, it makes sense. But why put it in with something else as not promised? And I think that is what Americans often get angry about.
Ryan Alexander with Taxpayers for Common Sense, thanks so much for being with us.
ALEXANDER: Thank you.
SANCHEZ: I have got something else I want to show you now, by the way. We just got this video in. This is President Bush moments ago signing the legislation. There is the very first picture to come out of the Oval Office. There's the president.
We're going to be coming right back.
Who won the vice presidential debate last night? We have got the fresh -- the polls hot off of the wires, as they say, and Bill Schneider is going to join us with those.
Stay with us. We will be right back.
(COMMERCIAL BREAK)
SANCHEZ: And during the commercial I started checking to see some of the stuff that you guys are sending me. This one is really too good.
Johnny B. Goode (ph), let's go over to Workingclassdog on the big Twitter board. Workingclassdog says: "I wish I was making wooden arrows or rum for a living. I could put both to good use right about now." (LAUGHTER)
SANCHEZ: All right, let's go now to our League of First Time Voters. This is about people who haven't yet made up their mind on who they're going to vote for. These are very strong independent-minded women I had a chance to sit down and talk to just yesterday. And it's interesting, when you say is it the war on terror or is it the economy?
(BEGIN VIDEOTAPE)
SANCHEZ: What's the most important thing to you right now?
UNIDENTIFIED FEMALE: I think that the war is affecting our economy. And then I think everything -- our whole economy is going to be affected whether we stay in the war, pull out of the war.
UNIDENTIFIED FEMALE: I can see how, yes, the war in Iraq is kind of intertwined with our economy, because so much -- you know, the price of our food is going up because fuel is so expensive.
UNIDENTIFIED FEMALE: I just got out of graduate school. I have a student loan sitting out there. I want to know who's going to put more money in my pocket so I can pay that guy off.
So that's kind of my bottom line. I'm more worried about the economy.
(END VIDEOTAPE)
SANCHEZ: Switching topics now, we've got some sound coming in from Barack Obama. And what's interesting about this is Barack Obama rarely refers to Sarah Palin or any of her actions or her interviews with Katie Couric. But he did this afternoon and we have that.
Let's listen to that.
(BEGIN VIDEO CLIP)
SEN. BARACK OBAMA (D-IL), PRESIDENTIAL CANDIDATE: You know there were a lot of noteworthy moments in that debate last night. But there's one that sticks out this morning. It's when Senator Palin said to Joe Biden -- or Governor Palin said to Joe Biden -- that our plan to get our economy out of the ditch was somehow a job-killing plan. That's what she said.
I wonder if she turned on the news this morning, because it was just reported that America has experienced its ninth straight month of job loss.
(END VIDEOTAPE)
SANCHEZ: We checked the, by the way, figures to make sure and see. He was absolutely correct. September job losses, 159,000. The year, we're down 750,000 jobs. And this makes it the largest since 2003, talking in terms of unemployment. I want to show you another one now. This is John McCain -- Angie do we have that ? This is John McCain earlier today in Colorado. Let's take a listen.
(BEGIN VIDEO CLIP)
SEN. JOHN MCCAIN (R-AZ), PRESIDENTIAL CANDIDATE: How about Sarah Palin last night, huh?
(APPLAUSE)
MCCAIN: How about her, huh?
(APPLAUSE)
MCCAIN: How about the job she did, huh?
(APPLAUSE)
MCCAIN: Come here. Come here. Look at this. Viva la barracuda!
(APPLAUSE)
MCCAIN: Thank you.
You know, I almost felt a little sorry last night for my old friend, Joe Biden.
(LAUGHTER)
MCCAIN: She did a magnificent job. And she's the news for the big spending, smooth-talking, me-first country second crowd in Washington and Wall Street that We have a message that we've got a message. We've got a message, Sarah Palin and I, and that's change is coming. Change is coming to Washington and to Wall Street.
(END VIDEOTAPE)
SANCHEZ: By the way, we've got a lot of comments on this.
I'm looking at the Twitter board over here and it is jam packed, as you might imagine. But we also have a poll that we're going to sharing with you in just a little bit as to who actually won this thing. And Bill Schneider is going to be joining us on the backside to talk about that.
Stay with us. We'll be right back.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
JENNIE LAW, PLAYING "PALIN BINGO": It's Sarah Palin bingo. It's using some of the catchphrases or words that she seems to have used most. So every time she uses one, we make a mark.
(END VIDEO CLIP)
(BEGIN VIDEO CLIP)
CHUCK HEATH, GOVERNOR SARAH PALIN'S BROTHER: I had some knots in my stomach. But I also had a lot of confidence that she was going to pull it off and that what America was going to get to see is the Sarah that we already knew up here.
(END VIDEO CLIP)
SANCHEZ: Did you see the debate last night? How did Sarah Palin do? How did Joe Biden do? Who really won this thing?
The man who can answer some of those questions, at least in terms of some of the research that we've done here at CNN, is our own Bill Schneider. He's joining us now live.
Let's start with the first question, I guess that's who do the polls say won this thing -- Bill?
WILLIAM SCHNEIDER, CNN SENIOR POLITICAL ANALYST: Well, you know, there are really two contests there. There was Sarah Palin versus expected. She won that one, because we asked people did she do better than expected?
And 84 percent said yes. They didn't expect her to do particularly well and some people were kind of nervous, apprehensive. But she did perform better than people expected her to do.
But then when he asked who do you think did a better job in the debate, that was Sarah Palin or Joe Biden, Joe Biden won that race 51 to 36. That's a 15-point margin.
So a pretty decisive victory for Biden. Why did he win?
Because people thought that he was better qualified, more intelligent and his answers were clearer. She was more likable, but in the end, voters who watched the debate thought he was better qualified for the job.
SANCHEZ: Yes, let's look at that number. I think we might be able to put that one up. And then it's interesting, when you ask different questions, you get different responses. Like you said, she did very well with people who somehow feel like she met the expectation and actually exceeded it, right?
SCHNEIDER: That's right.
SANCHEZ: But then when you ask the question about who is most qualified, he does very well.
What's that tell us?
SCHNEIDER: Well, that tells us that -- it's like hiring someone for a job. There are people that you might like better. And in this case, people said they thought Sarah Palin was more likable. But on qualifications, Joe Biden stood out. Almost 90 percent said that he's qualified to be president.
People were split on Sarah Palin. In fact, a slight majority said she is not qualified to be president. Why president? She's not running for president. Because the Constitution of the United States says: "The qualifications for vice president shall be the same as those for president."
SANCHEZ: And so when you're...
SCHNEIDER: So when you're asking about the about the vice presidency, you've got to consider are they really qualified to take over if something should happen to the president.
SANCHEZ: Bill Schneider, the best in the biz. Thanks for being with us. It's always a pleasure, Bill. We appreciate having you with us.
By the way, Roger, take this three shot, if we can. Look at these two women who are going to be joining me here in just a little bit. This is Maru Gonzales. She is a supporter of Barack Obama.
And do you think -- who do you think did the best last night?
MARU GONZALEZ, OBAMA SUPPORTER: I think that Joe Biden won hands down.
SANCHEZ: All right. And this is Jade Morey. And she's going to be joining us, as well. She supports John McCain.
Who do you think did the best last night?
JADE MOREY, MCCAIN SUPPORTER: Governor Palin, without a doubt.
SANCHEZ: All right, you know what, let's bring the deep ideas out when we come back. The three of us will discuss this debate, specifically the points made.
We'll be right back.
(COMMERCIAL BREAK)
DR. SANJAY GUPTA, CNN CHIEF MEDICAL CORRESPONDENT (voice-over): Kris Verdin knew he was living on borrowed time. He was 366 pounds and had a family history of heart disease.
KRIS VERDIN, HEART ATTACK SURVIVOR: A year-and-a-half ago, almost to the day, I got done cutting my grass. I was watching some football. And I started having some breathing difficulties.
GUPTA: Chris's prediction came true, but much earlier than expected.
VERDIN: I had a heart attack at the age of 32.
GUPTA: He was rushed to the hospital and had an emergency angioplasty, where doctors reopened up an artery that was 100 percent blocked. He had five more stents put in the following week.
VERDIN: It's a traumatic experience and I don't wish it on my worst enemy. But, I mean, I've said many times, the best thing that ever happened to me was that I had a heart attack, because it's going to add years onto my life.
GUPTA: Since that day, Chris traded in his pizza and fast food eating habits for salad and grilled chicken and became a group cycling instructor at the local YMCA.
So far, he's dropped 110 pounds. So what has the whole experience taught him?
VERDIN: You know, you've got to change. You've got to -- you've got to take your life into your own hands. And you need to have to have a wakeup call and don't let the wakeup call be an ambulance taking you to the hospital and a nurse telling you that you're having a heart attack.
My name is Kris Verdin and I've lost 110 pounds.
GUPTA: Dr. Sanjay Gupta, CNN, reporting.
(COMMERCIAL BREAK)
SANCHEZ: And we welcome you back.
I want to show you something. Let's go to the Twitter board, if we can, possibly. I want to show you what a lot of people thought about the debate last night. Maybe you agree with this. This is from Gracesince1983. And she says: "She showed a lot more confidence, a knowledgeable V.P. candidate, and reversed her image a little. But the scar from that wound remains."
And the wound that she's referring to is the interview with Katie Couric. So that's what we have here.
We're joined now by two people who are going to be helping us go through this conversation. Maru Gonzalez is a very active Barack Obama member -- also -- supporter, I should say.
Jade Morey is an alternate delegate for John McCain, also very active on behalf of the McCain campaign.
All right, let's start with this. If her role last night was to undo some of the damage that had been caused by Katie Couric's interview with her, was she successful in that? -- Jade?
MOREY: Absolutely. She highlighted her experience as governor of a state. And she really -- she really tied it into this election and what were her experiences and some of the big issues going on in the 2008 presidential election and how that really goes along with Senator McCain's agenda of reform and things that she's done in her state.
I mean I think it was extremely successful and I was very happy.
SANCHEZ: Do you agree?
GONZALEZ: Well, I mean I think she exceeded expectations. But let's not forget, the bar was set so low that George W. Bush could have exceeded those expectations. I mean the fact that the expectations for her were so low to begin with -- I think that should be the bigger issue.
I've heard pundits say that she did what she had to do, that she was sufficient. But we're at a critical juncture in our history that sufficient just isn't going to cut it. The jobs report came out today. We lost 159,000 jobs in the past month. I mean we...
SANCHEZ: As reported on this newscast just moments ago.
But let me ask you this, because there's another side to this. Joe Biden's task, if it were, last night, was to go out there and really hammer away at John McCain's record, to question it at every possible chance he could.
Was he able to do that well? Was he successful? I'll start with you.
GONZALEZ: Absolutely. I think he was very clear in his answers and I think that's why viewers on CNN overwhelmingly said that Joe Biden won the debate. Sarah Palin was dodging questions left and right. She couldn't give clear answers. She was talking to...
SANCHEZ: Do you think...
GONZALEZ: ...sticking to talking points.
SANCHEZ: Do you think, though -- and I'm going to take this to Jade for just a moment.
Jade, do you think that as a result of Sarah Palin having to bring up her own bona fides, having to show that she really was qualified as an administrator, it didn't give her a chance to then challenge Joe Biden in his assertions that John McCain is not ready to be the president?
MOREY: Well, she did that because that's what the people wanted to see. I mean that's what they had been asking for from her. They wanted to see the real Governor Sarah Palin. And I think she did that.
You know, she explained where her experiences lie. And that's a lot of what people have been questioning about her.
SANCHEZ: But if had chosen someone like, let's say, a senator who already has that experience, that didn't need to do that, would they have been more capable and better able to then deflect his comments about John McCain...
MOREY: If he...
SANCHEZ: ...by talking about John McCain and not about her being the mayor of Wasilla or the governor of Alaska? MOREY: If that's what John McCain wanted in that debate, he would have picked a sitting senator or someone like that, who could answer every question or every point that Biden brought up about an individual amendment or a bill or resolution or a version of a bill. That's...
SANCHEZ: Yes.
You think she's still the right choice?
MOREY: Absolutely. That's not what Senator McCain wanted when he picked her. He wanted an outsider. He wanted somebody who was not within the Washington beltway. He wanted a normal average Joe with executive experience and a fireball. And that's what he got.
SANCHEZ: You guys are good. You guys are good. I appreciate you being here. We'll continue doing this.
By the way, what's the market going to end up at today? We'll have that for you.
Stay with us. We'll be right back.
(COMMERCIAL BREAK)
SANCHEZ: And we welcome you back.
I'm Rick Sanchez here in the World Headquarters of CNN.
Before we do anything else, let's check in with Wolf Blitzer, who's going to have his hands full today.
Boy, a lot of news this week, hasn't there been -- Wolf.
WOLF BLITZER, CNN ANCHOR: An incredible week, a lot of news. Rick, thank you.
The House passed it, the president has signed it, so what happens next?
Will the credit markets loosen up? Will America's economy stabilize? We're going to have complete coverage of this developing story -- the answers you need.
Plus, the debate the day after -- we're breaking down what he said, what she said, what it all means for the race for the White House.
And what about all those extras in the bailout bill? Is it really all pet projects? We're fact checking like only CNN can do.
All that, Rick, and a lot more coming up right here in "THE SITUATION ROOM."
SANCHEZ: Always look forward to it, Wolf. Love your work. By the way, there's a lot of stuff that we don't get to this week because of this big story. And in our editorial meetings we always say boy, I wish we could have done that story.
So here's what we're going to do for you. Here's a look at the stories that we wish we would have been able to bring you. We'll have that, right after this commercial.
(COMMERCIAL BREAK)
SANCHEZ: Well, some comments on a conversation we just had moments ago with Jade and Maru.
Let's go to our Twitter board, if we possibly can.
Ibaro (ph) says: "Palin took the heat off herself and removed fear of bringing the ticket down. Now McCain will get back to doing that."
Interesting comment. We could go through so many of them. We thank you. Thousands of you have been sending us information on this and your comments and your responses.
But let's do this now. Let's talk about some of the stories that we didn't get a chance to cover this week, including somebody suddenly discovered who's been gone for a year.
And O.J. Simpson back in the news, but not much. Here it is.
(BEGIN VIDEOTAPE)
SANCHEZ: While your 401(k)s were 86ing this week, while these folks were throwing $700 billion of your dollars back and forth...
UNIDENTIFIED MALE: This is a huge cow patty.
SANCHEZ: ...while Governor Palin got a cheese steak...
GOV. SARAH PALIN (R-AK), VICE PRESIDENTIAL CANDIDATE: (INAUDIBLE).
SANCHEZ: So much news flew beneath our radar, so much we didn't show you.
We didn't show you O.J. Simpson's defense resting in Vegas. The jury started deliberating his fate on armed robbery and kidnapping charges 13 years to the day after he was acquitted of murder in the death of his ex-wife and a friend.
You also missed it when a hiker and his dog in California came across some money and an I.D. that led authorities to the wreckage of millionaire adventurer Steve Fossett's plane. They've been looking for more than a year -- and, yes, there's some human remains. No positive I.D. yet, but you do the math.
Ted Stevens, the United States Senator on trial, charged with corruption -- it almost fell apart while we were looking elsewhere. The judge considered a mistrial after the defense accused the prosecution of misconduct. Nope, the Alaska lawmaker is back in court Monday.
And let me out of this thing -- China, a distant third in the space race. But they're not out of it. China sent three men into orbit. One of them walked around outside and back they came to earth, safe and sound. To boldly go, indeed.
(END VIDEOTAPE)
SANCHEZ: So many of you are trying to reach to us tell us what you think of this bill that was passed with all this pork.
Guess what? Twitter is overcapacity. Oh, no. But don't worry, fans. That's why we have Facebook, as well.
We'll move over to the right, if we possibly can, and you'll see what Carol Freeman has to say about this. Nice move, Johnny B. Goode.
Carol Freeman writes: "She didn't totally undo it," referring to Sarah Palin. "I, too, believe that she crammed for the test, but is not qualified to be a heartbeat away from the presidency."
Let's go to the big boards now, not our little boards, but the ones that Susan Lisovicz follows for us all day long -- and, you know, it's interesting, Susan, that we're looking at a market that didn't react the way many people thought it would, right?
SUSAN LISOVICZ, CNN CORRESPONDENT: Yes. Rick, you know, the trading week started with a sell-off when the House rejected the financial rescue package and the trading week will end with a sell-off after the House approved the financial rescue package. It's a classic case.
Rick, we hear this buy on the rumor, sell on the news. Everyone knew, after what happened Monday -- the biggest point loss ever for the Dow Industrials -- that Congress had to act. And it wouldn't vote unless it would pass. And then today the jobs report basically put a gun to lawmakers' heads. We got the worst monthly jobs report in five years -- a loss of 159,000 jobs. The economy has lost nearly 800,000 jobs year-to-date. Plus, we already got crummy auto sales...
SANCHEZ: I wonder...
LISOVICZ: ...factory orders...
SANCHEZ: I just wonder if everybody went in there and bought all the deals in the last couple days and now they're kind of like done buying and there's no sales left.
LISOVICZ: Well, you know what?
You know what?
We're also going into a weekend. A lot of things have happened on the weekend, Rick. You think about it -- Fannie Mae, Freddie Mac, Lehman. Everybody is still cautious. And so they kind of square up for the weekend and wait to see if anything else happens.
SANCHEZ: Right.
LISOVICZ: In the meantime, we've got quarterly earnings coming -- starting to come. Everybody's nervous about that. The Dow will lose 800 points this week -- Rick, back to you.
See you next week.
SANCHEZ: All right, Susan Lisovicz. Good job. What a busy week it's been for you.
And, by the way, we're blowing up Twitter. It's still overcapacity. Look at that, as we go over to Wolf Blitzer.
He's going to bring us right into "THE SITUATION ROOM" -- Wolf.
BLITZER: Thanks very much, Rick.
