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Candidates Trade Jabs in Final Debate; Stock Markets Plunge; The Changing Electoral Map; Joe the Plumber Speaks Out; McCain Says Obama's Plans Are Class Warfare; Shoring Up the Economy; Analyzing the Final Debate
Aired October 16, 2008 - 07:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
BOB BARR (L), LIBERTARIAN CANDIDATE: What we hope to do is what we did last night in a program and what I've been doing across the commonwealth here and in other states over the last several weeks and that is bringing the message of a real choice, real change to this election. To point out that there is a different way than the big government bailouts of Senators Obama and McCain.
JOHN ROBERTS, CNN ANCHOR: All right. Congressman Barr, it's always good to check in with you. Good luck on the campaign trail today. We'll see you again soon.
BARR: Thank you, John.
KIRAN CHETRY, CNN ANCHOR: 7:00 here in New York. A look at the top stories this morning.
Stock markets around the world tumbling on worldwide recession fears. In fact, Tokyo's Nikkei fell more than 11 percent, the largest drop since 1987. Markets all across Europe down sharply as well. It comes after a 733-point loss yesterday for the Dow, the biggest, the second biggest drop ever. And right now, Dow futures are pointing to another drop this morning.
Japan's prime minister is blaming the U.S. for the latest drop in global stock markets telling lawmakers today, "Since the bailout was insufficient, the market is again falling sharply."
And Barack Obama won last night's debate, according to a CNN/Opinion Research poll. Fifty-eight percent said that Obama did the best job in the debate compared to only 31 percent for John McCain.
After the debate, Barack Obama's campaign slammed McCain saying two- thirds of the country already thought John McCain was running a negative campaign and "Senator McCain spent 90 minutes trying to convince the other third."
Joining me now from the debate site at Hofstra University is our Ed Henry with more reaction this morning to how the two candidates faced off against one another last night.
ED HENRY, CNN WHITE HOUSE CORRESPONDENT: Well, good morning, Kiran. Certainly, a more open format last night, allowed them to mix it up more than they did in the previous two debates. And John McCain also scored some more points but in the end, Barack Obama remained the front-runner.
HENRY (voice-over): Finally in the third debate the gloves came off.
SEN. JOHN MCCAIN (R), PRESIDENTIAL CANDIDATE: You launched your political campaign in Mr. Ayers' living room.
SEN. BARACK OBAMA (D), PRESIDENTIAL CANDIDATE: That's absolutely not true.
HENRY: From the start, McCain was crisper and stayed on offense, pouncing when moderator Bob Schieffer brought up Obama's ties to former 1960s radical William Ayers.
MCCAIN: Senator Clinton said in her debates with you, we need to know the full extent of that relationship.
HENRY: Eager to avoid a gaffe that might knock him out of front- runner status, Obama was flatter than before but he held his own by calmly pushing back.
OBAMA: Mr. Ayers is not involved in my campaign. He has never been involved in this campaign, and he will not advise me in the White House.
HENRY: On a day the Dow lost another 733 points, McCain had his best performance yet on the economy, repeatedly citing Joe the plumber.
OBAMA: Nobody likes high taxes.
JOE WURZELBACHER, JOE THE PLUMBER: No, not at all.
HENRY: An Ohio man who recently pressed Obama about whether his tax plan would hurt small businesses.
MCCAIN: Senator Obama wants government to do the job. I want, Joe, you do the job. I want to leave money in your pocket.
HENRY: An attack Obama sidestepped with a joke.
OBAMA: I'm happy to talk to you, Joe, too, if you're out there.
HENRY: Some undecided voters in Joe's home state told CNN McCain repeated the story too many times, and he continued to struggle with the shadow of President Bush.
MCCAIN: Senator Obama, I am not President Bush. If you want to run against President Bush, you should have run four years ago. I'm going to give a new direction to this economy.
HENRY: A softball for Obama to drive home his underlying point about change. OBAMA: Now you've shown independence -- commendable independence, on some key issues like torture. But when it comes to economic policies, essentially what you are proposing is eight more years of the same thing.
HENRY: The bottom line is that John McCain raised his game last night. But without a major miscue from Barack Obama, the Democrat is still in the driver's seat with only 19 days to go -- Kiran.
CHETRY: Ed Henry for us this morning. Thanks.
ROBERTS: Let's bring in our Suzanne Malveaux now. And, Suzanne, the debates are all over as we enter the homestretch now. Is it 19 days more of campaigning?
SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: I'm just counting like how many days.
ROBERTS: Counting all over the fingers there.
MALVEAUX: But we're not counting. No. Who's counting?
ROBERTS: Some people were saying, you know, you look at the poll numbers, you look at what's happening in the battlegrounds, stick a fork in John McCain, he's done. Is that the case or is he potentially gaining some momentum here based on his performance last night?
MALVEAUX: Oh, you know it's interesting because there could be a game changer, sure. You know, 19 days left. But if you look at the polls, and you go on the debate watches from last night, and you take a look at what people are watching, if you believe that the winner of the debate is the one who's going to come out on top, then you see Obama is at 58 percent, McCain at 31 percent.
If you take a look at who's more likeable, if you vote for your president based on that, Obama 70 percent, McCain 22 percent. If you care about Obama's associations with '60 radical William Ayers, 60 percent of people say it didn't really make that much difference to them. So if you take a look at all those numbers, it looks like Obama has a pretty good sizable lead at this point.
ROBERTS: Right. And you know, when you look at the number of undecided voters, eight percent, that is well within the margins of a lot of these battleground states.
MALVEAUX: And then also the unknowns. We don't know how many people are new voters, and we don't know how many people have already voted. So those are things that are just kind of out there, pulling out there. So you never know. He still has some time.
ROBERTS: As we have shown in the electoral map, John McCain has got a much bigger hill to climb to get to the Oval Office than Barack Obama does. So in terms of the campaigns, where are they headed today to try to either shore up their support or try to whittle away at the Republicans?
MALVEAUX: Well, obviously, Pennsylvania is key. And we've seen the polls. Obama has a slight lead in Pennsylvania. It's been widening over the last week or so, but John McCain is heading there today.
Sarah Palin and John McCain were there right before the debate day and that's where he laid out his economic plan. That's very important for him.
We're going to be following Obama today to New Hampshire. He's also doing well in that state. And as you know, you know, Hillary Clinton did very well. He has managed to chip away at some of the more conservative voters. That's a very important state for him.
So, this is, you know, this is where they're going to be. It's like a handful of states and that's where they're headed for the next three weeks. And how that, you know, what happens and how that margin widens is really going to depend on who comes out on top.
ROBERTS: It takes us to McCain in Philadelphia today and then Chester County, Pennsylvania, which George Bush won in 2004, but Barack Obama beat Hillary Clinton. So --
ROBERTS: Interesting race there.
MALVEAUX: A toss up.
ROBERTS: It will.
Suzanne, thanks so much for that.
CHETRY: Well, we're following breaking news this morning as financial markets tumble around the world. In Japan, the Nikkei lost more than 11 percent. Hong Kong's key index dropped almost five percent. And in the U.K., the FTSE is dropping more than two percent.
In a speech in New York, Fed Chairman Ben Bernanke explained what he thinks will bring it in to the current financial crisis.
(BEGIN VIDEO CLIP)
BEN BERNANKE, FEDERAL RESERVE CHAIRMAN: As in all past crises, at the root of the problem is a loss of confidence by investors and the public in the strength of key financial institutions and markets. The crisis will end.
(END VIDEO CLIP)
CHETRY: All right. We're having a little trouble hearing him there. But just an example of just how all over the place things are, a couple of minutes ago, we said that Dow futures pointing down.
Right now, we have Dow futures up 76 points. Christine Romans is here "Minding Your Business" this morning. Volatility certainly the key phrase as what we've seen.
CHRISTINE ROMANS, CNN BUSINESS CORRESPONDENT: We've never seen volatility like this in the markets and even when you go back. And it's been just so wild the moves, I mean, you'd be forgiven for being absolutely, you know, suffering from whiplash here.
What the Fed Chairman Ben Bernanke said was don't expect a quick recovery but we've got all the tools and we're using them to fix this thing. But I don't think anybody expected a quick recovery but just some reminders out there that the game now is trying to gauge the depths and the duration of economic weakness in this country, who is it going to hurt and for how long. And that's what everyone is weighing in the stock market. They are weighing each piece of data as it comes and trying to figure out just what this is going to mean for the economy and for corporate earnings and for growth going forward.
Now, yesterday, the Dow at the end of the day completely fell off a cliff giving back almost all of the gains that we've had from earlier in the week. The Dow down 733 points. That's the second biggest point drop.
CHETRY: We have 773. It's 733?
ROMANS: 773 when you look again here.
CHETRY: I think you're right. 733.
ROMANS: It is more than 700 points, I can tell you with great specificity.
CHETRY: Oh, great.
ROMANS: The Nasdaq down 151, and the S&P down 90 points. You know, what's 40 points among friends at this point because it is absolutely wild what's been going on.
Now, consumers, we know are pulling back, either because they're worried about the economy and they're worried about their money, or because they can't put any more on their credit cards. Credit card defaults are going up. They can't borrow any more from their house to go out and spend. So you're seeing at the casinos, you're seeing at the auto dealership, you're seeing at the mall, you're seeing people pull in their horns.
Quick point -- one bright spot in all this. Did you know that oil prices are down 75 bucks -- 75 bucks since July?
CHETRY: It is.
CHETRY: They're down more than $1.05 a gallon than they were in their high in July. So --
ROMANS: And that is the twisted silver lining in a very weak economy.
CHETRY: All right.
ROBERTS: How much is your 401(k) down? Let's not think about that.
ROMANS: Thanks, John.
CHETRY: If you're checking some 35 percent, thanks, John.
All right. Christine, we'll see you in a few.
ROBERTS: Breaking away.
(BEGIN VIDEO CLIP)
SEN. BARACK OBAMA (D), PRESIDENTIAL CANDIDATE: And, frankly, Senator McCain voted for four out of five of President Bush's budget.
SEN. JOHN MCCAIN (R), PRESIDENTIAL CANDIDATE: I am not President Bush. If you want to run against President Bush, you should have run four years ago.
(END VIDEO CLIP)
ROBERTS: McCain fed up with Democrats drawing parallels between himself and the unpopular president. The political strategy going forward.
You're watching the "Most News in the Morning."
(BEGIN VIDEO CLIP)
SEN. JOHN MCCAIN (R), PRESIDENTIAL CANDIDATE: Senator Obama, I am not President Bush. If you want to run against President Bush, you should have run four years ago. I'm going to give a new direction to this economy in this country.
SEN. BARACK OBAMA (D), PRESIDENTIAL CANDIDATE: If I occasionally mistaken your policies for George Bush's policies, it's because on the core economic issues that matter to the American people, on tax policy, on energy policy, on spending priorities, you have been a vigorous supporter of President Bush.
(END VIDEO CLIP)
CHETRY: Barack Obama and John McCain trading barbs on President Bush, but it wasn't the only thing they attacked each other on last night. The gloves came off in their last debate before the election. So did this debate change anything as we head into the final 19 days until the election?
Joining me now is Lisa Caputo and Ed Rollins. Both of you staying up and watching the debate as well. Good to see you this morning.
Ed, we -- a lot of people talked about this as needing to be a game changer for John McCain. Did he deliver that game-changing performance?
ED ROLLINS, REPUBLICAN STRATEGIST: It was his best debate performance. I don't think there was anything else he could have done, but it didn't change the game. At the end of the day, the analysis by everybody is that Obama won, you know, other than some of the conservative commentators. And I don't think he did anything to unnerve Obama and he had to do something to make Obama make a mistake. I think, once again, he was aggressive, he made his points, but it was not a game changer.
CHETRY: Lisa, we heard Joe the plumber come up 26 times last night, talking about how Barack Obama want to "spread the wealth" in this back and forth with this guy who wanted to buy a small business. Did that help, hurt the Democrat in any way?
LISA CAPUTO, DEMOCRATIC STRATEGIST: I don't think it hurt at all actually, and I thought Senator Obama did a terrific job laying out his economic policy. I think John McCain missed a big opportunity to lay out in detail his economic policy.
And I think while McCain started off strong, he seemed to lose his footing kind of half an hour into the debate when he went on the negative. When he started talking about Ayers, when he asked for a repudiation of John Lewis. And Obama remain unflappable.
And I thought that that was just interesting that he tried to go on the offensive, lost his footing, and then try to portray Obama as a tax and spender. It didn't stick, and Obama just seemed to look presidential, maintained his cool and stuck to his policies in laying out the specifics of his policies which I thought was very effective.
CHETRY: This is something, though, Ed, that the conservatives wanted to hear him say. They wanted to bring up questions about judgment as it related to Bill Ayers. So McCain really was boxed in a corner with that. He really had to bring it up last night.
ROLLINS: He was. He did. I also think he wanted to bring it up. I mean, I think that he --
CHETRY: Did he do it right?
ROLLINS: You know, it's hard to say what's right and wrong. I mean, when everybody cares about the economy, it's you know, negatives are very hard to deliver. You have to deliver with a little bit of humor. You have to deliver -- there was no humor in John last night and unfortunately, I think the impression of who is the calmer, who was -- was clearly not him.
I think the resentment that he has, having run for the presidency for ten years just showed every moment, what you are doing on the stage with me, you're a kid, and that came through. And the kid, basically, kept jabbing and moving and did very well. CHETRY: When we look at the electoral map right now, it does look like an uphill climb for John McCain. If you had to advise him, Lisa, or if there was any advice you can give as to how he could turn it around for himself, what would you say? What would be the one of the keys?
CAPUTO: I would tell him to focus on the economy, and I would tell him to get specific on the economy. And I would tell him to keep his cool.
The split screen did no favors for John McCain last night. He came across as an angry older man, whereas Barack Obama was specific on his policies, particularly on education and health care, which I think really appealed to a lot of independent voters, and the whole issue around the Supreme Court, really appealed to women voters. And let's remember most swing voters are female voters.
So if I were advising McCain, I would tell him stick to the economic issues and focus your message on what you're going to do to help Joe the plumber. That didn't come through last night. He tried, but it didn't come through. He went on the negative against Obama, and he didn't talk about his own specifics.
CHETRY: All right. Well, we're going to leave it there, but we'll see you guys back in a few.
Ed Rollins and Lisa Caputo, thanks.
ROLLINS: Great. Thank you.
ROBERTS: Just 19 days now left until the election. Can John McCain make a big comeback? Pennsylvania Governor Ed Rendell is here with advice for both candidates.
And nobody feels the economic slap harder than someone who just lost their home to foreclosure. We were with one displaced family as they watch the debates last night.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: No. How can he understand it? How can he really understand it? The man owns seven houses. He doesn't understand how we feel.
(END VIDEO CLIP)
ROBERTS: See how the former homeowners react to both candidates plan.
You're watching the "Most News in the Morning."
ROBERTS: So after last night's third and final debate, we got some changes to the electoral college map to tell you about here. Some pretty significant changes as well. Yesterday morning, here's where we were. Barack Obama had 264 electoral college votes to John McCain's 174 based on polling and CNN projections. That has changed and has changed big time. And here's the reason why.
The state of Virginia which has not voted for a Democrat since 1964 is now 10 points in Barack Obama's favor according to latest polls, enough to have it what we call, lean Democrat or lean in his favor. So if we look at the tally now, he's over the line -- 277 to 174 electoral votes.
Now this is all theoretical. But yesterday, it's interesting to note that the story was about Colorado because Barack Obama was up by as much as nine points there. That was the state that could have decided the election. Today, Colorado was within four, so that keeps it well within toss-up category.
But Virginia now, 10 points out for Barack Obama. So the Commonwealth of Virginia could now be the state that decides the election in 2008. And 19 days to go, so a lot can still change -- Kiran.
CHETRY: John, thanks.
You know, there's been a lot of talk about Joe the plumber. In fact, his name was mentioned 26 times at last night's debate. He's the guy seen here who spoke to Barack Obama at a campaign stop and said that Obama's tax plan would prevent him from buying the plumbing business he currently works for. Now the unwitting star of the debate is speaking out on "Good Morning America" this morning.
(BEGIN VIDEO CLIP, FROM ABC'S "GOOD MORNING AMERICA")
JOE WURZELBACHER, JOE THE PLUMBER: Quite honestly, why should they be penalized for being successful? I mean, that's what you're telling me. That's what it sounds like they're saying. That's wrong. I mean, because you're successful you have to pay more than everybody else?
I mean, we all live in this country. I mean, that was, you know, it's a basic right. And Obama wants to take that basic right and penalize me for it. That's what it comes down to. I mean, that's a very socialist view and it's just incredibly wrong.
I mean, you know, $250,000 now. What if he decides, well, you know, $150,000 you're pretty rich, too. Let's go ahead and lower it again. You know, it's a slippery slope. When is it going to stop?
(END VIDEO CLIP)
CHETRY: Well, with all the talk, Joe the plumber last night who used the situation to his best advantage. Governor Ed Rendell is here from battleground Pennsylvania to give us his take this morning.
You're watching the "Most News in the Morning."
(COMMERCIAL BREAK) ROBERTS: She has been barnstorming across blue collar America and last night Senator Hillary Clinton was a surrogate for Barack Obama after the debate. And once again, Senator Clinton said she is not looking ahead to 2012 and does not want a position in the cabinet.
(BEGIN VIDEO CLIP)
SEN. HILLARY CLINTON (D), NEW YORK: Really want to stay a senator. I am committed to being in the Senate, working with President Obama. I think we have a real chance to break the gridlock, get things done, start progress going again in America and I want to be part of that in the Senate. And one of the lessons that I took away from my husband's administration is don't take senators out of the Senate. You need every Democratic senator that you possibly can have.
(END VIDEO CLIP)
ROBERTS: Clinton also said that Barack Obama is now a perfect three for three in the debates and that he displayed steady leadership.
Twenty-six minutes after the hour. Joining me now is one time Hillary Clinton supporter and current Barack Obama supporter, Pennsylvania Governor Ed Rendell.
Governor, it's good to see you. In terms of the performance that he put in last night, did Senator Obama help himself in explaining the need for a tax increase to Joe the plumber? Five years ago he said you needed a tax cut, now it's time to share the wealth. Is that the type of language that small businesses in America want to hear?
GOV. ED RENDELL (D), PENNSYLVANIA: Well, again, remember, John, the small businesses who don't clear a profit of $250,000 and that's most of them, that's about 90 percent of them, don't have to worry about a tax cut.
RENDELL: So it's only the small businesses that are doing very well that do need to have a tax cut. Look, I think this is a time for Americans across the board to rally around their country.
You know, I think George Bush made a huge mistake after 9/11. He should have called on all of us to forego that tax cut because we were going to go to war to make right what happened on 9/11.
I think presidents have to lead. They have to call on Americans to sacrifice. And I think for Americans like my wife and myself who make a very good living, we make just on salary $350,000, for us to pay a little bit more in taxes is not a sacrifice for this country to make the improvements it needs to stay competitive.
ROBERTS: Let me --
RENDELL: Americans should understand we are challenged right now and unless we do something significant, this country is not going to stay a world leader. ROBERTS: Let me stick with you on this idea of how it affects small businesses. Here's how John McCain put it last night when talking about it.
(BEGIN VIDEO CLIP)
SEN. JOHN MCCAIN (R), PRESIDENTIAL CANDIDATE: We're going to take Joe's money, give it to Senator Obama, and let him spread the wealth around. I want Joe the plumber to spread that wealth around. You told him you want him to spread the wealth around. The whole premise behind Senator Obama's plans are class warfare, let's spread the wealth around.
(END VIDEO CLIP)
ROBERTS: So we just heard from Joe Wurzelbacher, Joe the plumber, a couple of minutes ago. The suggestion is that he would like to grow his business but if he grows his business he's going to get into this new tax bracket where everything that he makes above $250,000 will be taxed at an extra three percent. And what incentive is there to sort of pursue the American dream here if you're going to bump into these higher tax brackets? What incentive is there to try to expand your business?
RENDELL: First of all, what Senator McCain said is the same trickle down economics we've had for eight years and that has proved to be a flat-out disaster for the country. We created about a fifth of the jobs we did during the time Bill Clinton was president and, in fact, we're losing the jobs we created at a rapid rate of almost 100,000 a month. So let's be clear.
Trickle down economics doesn't work to help 90, 95 percent of Americans. So we have to do something else. Is there an incentive for Joe six-pack? Sure, there is. Because if he makes more than $250,000, he'll continue to have more money in his pocket than if he made $150,000, he'll just pay part of the burden.
I've never seen an entrepreneur say, I'm going to stop making money because the government is going to tax more of it. That's baloney. If the government taxes seven percent more, you still got the 93 percent extra that you made. That's just a speechless argument.
ROBERTS: But the opposite side of that argument is you keep taxes low. And where you try to save money is you go in there and you cut spending. You go through there...
RENDELL: And, John, how are we are doing now?
ROBERTS: ... either with a hatchet, with a scalpel or whatever, and you cut as much spending as can you and let businesses, let taxpayers try to grow the economy.
RENDELL: Well, how are we doing now? That's the philosophy that's predominated for the last eight years. And how are we doing now? We're doing terribly, and we got to do something that's very significant. But having said that...
ROBERTS: But nobody cuts taxes (ph).
RENDELL: ... that doesn't mean -- that doesn't mean that you shouldn't cut spending and you've heard Barack Obama say he's going to go over the federal budget with a fine tooth comb. He's already identified billions of dollars of savings and dealing with drug companies.
Yes, there are savings to be rendered. There are absolutely savings to be rendered, but we need more fairness in this country.
What do you say to the American worker who has busted his hump for 35 years and he sees his company go bankrupt, his pension gone, his health care gone, and he sees the CEO who brought that company to the brink of disaster getting $46 billion dollar bailout passage? There's got to be fundamental fairness. That's not class warfare that's fairness. You know, in Japan -
JOHN ROBERTS, CNN, ANCHOR: Certainly says something an awful lot on people. Governor Rendell -
RENDELL: It upsets an awful lot of people who are doing very well in this country. And we've got to start concentrating on the people who are challenged. That's the middle class. It's not the very poor, it's the middle class. John.
ROBERTS: Governor, thanks for being with us. It's always good to see you. Hope to see you more between now and November 4th.
RENDELL: Thanks, John. Go Phillies.
ROBERTS: All right.
KIRAN CHETRY, CNN, ANCHOR: Well, it's 30 minutes past 7:00 right now. Breaking this morning, worldwide recession fears sending stocks lower this morning, almost everywhere. Tokyo's Nikkei down more than 11. And markets all across Europe fell down sharply as well. Japan's prime minister blames the market trouble on America's "insufficient bailout plan." Right now, Dow futures are pointing up though more than 100.
And gas prices down to $3.08 a gallon, according to AAA. The 77 percent drop in the past 30 days. New economic fears also sent oil prices to their lowest in more than a year hovering around 72 bucks a barrel overnight. Prices have not been that low since the summer of 2007.
Vice President Dick Cheney is home this morning. He is doing better after doctors treated him for an abnormal heart beat yesterday. The 67-year-old vice president has had a history of heart trouble including four heart attacks.
And we just heard Governor Rendell say go Phillies. The Philadelphia Phillies are headed to the World Series. It's their first trip to the fall classic in more than 15 years. Jimmy Rollins hit a lead off home run. They never looked back, beating the Dodgers 5-1 in game five. The National League champs will now have a week off before they play either Tampa or Boston.
The closer we get to election day, the dirtier it's getting at rallies and on TV ads. John McCain trailing by eight points in our latest poll and stayed on the offense last night against Barack Obama.
(BEGIN VIDEO CLIP)
SEN. JOHN MCCAIN (R), PRESIDENTIAL CANDIDATE: I don't care about a washed up terrorist but as Senator Clinton said in her debate with you, we need to know the full extent of that relationship. We need to know the full extend of Senator Obama's relationship with A.C.O.R.N. who is now on the verge of maybe perpetrating one of the greatest fraud in voter history in this country, maybe destroying a fabric of democracy. Same fund outfit organization that your campaign gave $832,000 for lighting and site selection. So all of these things need to be examined.
SEN. BARACK OBAMA (D), PRESIDENTIAL CANDIDATE: Of course, Mr. Ayers has become the centerpiece of Senator McCain's campaign over the last two or three weeks. This has been their primary focus. So let's get the record straight. Bill Ayres is a professor of education in Chicago. 40 years ago when I was eight years old, he engaged in despicable acts with a radical domestic group. I have roundly condemned those acts. Ten years ago, he served and I served on a school board that was funded by one of Ronald Reagan's former ambassadors and close friends, Mr. Annenberg. Other members on that board were the president of the University of Illinois, the president of Northwestern University who happens to be a Republican, the president of the "Chicago Tribune," a Republican leaning newspaper. Mr. Ayres is not involved in my campaign. He has never been involved in this campaign. And he will not advise me in the White House.
(END VIDEO CLIP)
CHETRY: After the debate, Barack Obama's campaign said two-thirds of the country already thought John McCain was running a negative campaign and "Senator McCain spent 90 minutes trying to convince the other third." So most debate watchers did think that Barack Obama got the best of John McCain last night. In fact, viewers gave their instant reactions in a CNN opinion research poll. 58 percent said they felt Obama won, 31 percent went with McCain.
So all night long, the candidates tried to reach out to average Joe, people like Joe the Plumber, who's name came up more than 20 times. But with real concerns about their jobs and their homes did they connect? AMERICAN MORNING's Carol Costello watched the debate with some victims of the mortgage meltdown, the Ward family in Michigan. Hi there, Carol.
CAROL COSTELLO, CNN CORRESPONDENT: Hi there, Kiran. You know, I am in Macomb County, Michigan, and this county has been hit hard by the mortgage meltdown, more than 5,000 foreclosures in this county alone. That's why you see the for sale sign and the for rent signs in this neighborhood. The Ward family, one of those people who were foreclosed on, I sat down and watched the debate with them. Let's listen.
COSTELLO (voice-over): The Wards consider themselves the little guy, one who has fallen on hard times. They were eager to watch the debate with their kids, hoping to hear something that would help them.
OBAMA: What we haven't yet seen is a rescue package for the middle class.
COSTELLO: The Wards desperately want that. They lost their home to foreclosure, declared bankruptcy and while they are thankful they were able to rent nearby, it is not enough.
KEITH WARD, BANK FORECLOSED ON HOME: It's not our home. We don't own it. What can they do to help that? That's my question.
COSTELLO: That's the answer the Wards wanted from the candidates. Keith a registered Republican listened intently to John McCain but did not like what he heard.
When John McCain was saying stuff like, you know, I understand why the middle class is angry did that resonate?
KEITH WARD: No. How can he under it? How can he really understand it? The man owns seven houses. He doesn't under how we feel.
JENNIFER WARD, BANK FORECLOSED ON HOME: So many of the politicians out there now that don't understand what the middle class is going through. And neither Ward liked McCain's idea for the government to buy and refinance troubled mortgages. They feel it helps the banks and not them. And McCain's references to Joe the plumber as every man was, according to Keith, annoying.
KEITH WARD: Senator McCain sounded like a used car salesman, pushing this Joe the plumber thing. All I heard out of him was big business getting cuts. Senator Obama, I heard us.
COSTELLO: What did resonate with them was Obama's plan to cut taxes for those making below $250,000 a year. The Wards told me Obama's calm demeanor comforted them too.
JENNIFER WARD: I'm tired of the smack, the smear campaign.
COSTELLO: Still, both Wards agree Obama won the debate handily but they're still not convinced he has the plan that will help them out of their economic nightmare. Although they are now leaning towards voting Obama.
COSTELLO: Now the Wards still have hope. Keith has a job and they are getting by. But, the Wards wanted to hear many more specifics from both candidates and they said they didn't hear those specifics last night.
CHETRY: You know, what struck me as interesting, Carol, is that you would think that would be the exact target of what John McCain was talking about with wanting to help people who are either in foreclosure, or under water by buying those mortgages and letting the people stay in their homes and they didn't feel that that worked for them.
COSTELLO: Well, it didn't work for them because - well keep in mind they already lost their home. Their home was auctioned off by a bank for $20,000. So nothing, either candidate said will help them get their home back and, you know, that's the most heartbreaking thing for them.
CHETRY: Yes. All right. They had a chance to see for themselves and as you said even though he's a Republican, he's now leaning towards Obama. All right. Carol Costello for us this morning. Thanks.
ROBERTS: 38 minutes after the hour now. Major movement in the battleground state with just 19 days left to go until election day. There is a color change in our magic map. We got the new numbers for you. You're watching "the most news in the morning."
CHETRY: Welcome back to "the most politics in the morning." You know, the election is just 19 days away and the battle is coming down to just a handful of states. That includes the state of Virginia where the latest poll has a 10-point lead for Barack Obama. This now puts it in the leaning Obama category. Interesting to note, Virginia has been in the Republican column in every presidential election for the past 44 years.
Joining me now from Stanton, Virginia, former Virginia Governor and McCain supporter, Jim Gilmore who is now running for the Senate. Good morning. Glad to have you with us today.
JIM GILMORE, FMR. VIRGINIA GOVERNOR: Thank you, Kiran.
CHETRY: It's a tough uphill battle, it looks like, for John McCain right now. How do you think his debate performance helped him?
GILMORE: I think it helped him a lot, Kiran, because what he was really trying to communicate - what I think he was communicating to the American people was concern about regular folks out there that are just trying to make a living. And you know, despite some of the footage that the viewers are seeing, I think if we see government continue to squeeze things out, continue to raise taxes, continue to really put this kind of high taxation on people, we're going to end up with even greater problems. We need to remember it was government that cause this problem on Wall Street by forcing banks to actually do improper lending and now we're paying the piper.
If we continue to invest government with more of our money and more of that kind of authority we are just going to continue to have these problems. I think Virginians know that. I don't think that the poll is right. I think the Virginians that I'm seeing and feeling are going to continue to keep Virginia in the red state column.
CHETRY: That's very interesting because the latest poll that we have, as we said, puts Barack Obama up by 10 points right now in a state that as we said, for more than four decades has not gone Republican. A few Republican strategists said to me today, republican strategists said to me, Virginia is changing. Virginia is changing. It's not a guarantee any more for Republicans,
GILMORE: I don't think Virginia was ever a guarantee for anybody. But Virginia is not going to be influenced by what some pollster some place says after he selects this type of sample and takes a look at who's answering the telephone. Virginia is going to answer the question who is going to be best for the security and the future of this nation. In the time of international crisis, you want somebody like a Navy veteran like John McCain who served well. You want somebody who understands government is not the answer. That in fact government cause this problem on Wall Street.
Make no mistake about that. And I think that you're going to see Virginians make their own minds up. And what I'm seeing and feeling out here in the community is very positive for this ticket, for the McCain ticket. I think he's going to win.
CHETRY: I want to ask you about your own race right now that's going on. You're running in a Senate against another former governor of the state. And right now, the polls have you - in some of the polling, behind Mark Warner by as much as 30 points. Is it just the wrong year to have an "R" next to your name?
GILMORE: well, you know, people will say these kind of crazy polls. But we're not seeing anything either publicly or privately that supports being behind by anything like that. We're actually seeing a surge at this point. We're seeing people moving away from Mark Warner into the undecided column. That's good news because they are hearing my message. And my message is we got to do something to get people back to work, we got to do something to continue to have trust in government, in doing the right thing as opposed to just putting trust entirely in government. I'm a person who opposed the bailout. I'm a person who believed that we can't have forced unionization. I'm a person that believes that we have to in fact get people back to work and get people working in the right way.
CHETRY: You know, for non-republicans I think the president's approval rating is hovering around 10 percent right now. How do you convince people right now that they should still believe in the GOP at this point?
GILMORE: Well, I think the Republican policies that we're offering are sound ones. We're not going to increase taxes on people in a time of financial crisis. And you know, while people will say don't worry, you're just going to tax the rich, the people of Virginia and the people of the United States know they always end up coming back to the middle class for that higher taxation.
We know that energy is a really significant issue. We've seen our gas prices come down because of what's going on Wall Street. This is an opportunity now to step out there and put in a real energy policy that includes long term programs, renewable energy conservation but you got to drill for oil. And it's very, very clear that the Democrats led by Barack Obama are not going to drill for oil in order to produce a real energy policy for this country. Virginians know this and I think that's going to make a big difference. We have to have a good energy policy and we can't continue to raise taxes on people.
CHETRY: All right. Former Virginia governor James Gilmore. Thanks for joining us this morning.
GILMORE: Thank you, Kiran.
ROBERTS: 45 1/2 minutes after the hour. The economy is issue number one in this election season. Gerri Willis is logged on. She's plugged in taking questions about your money right now. What are you hearing, Gerri?
GERRI WILLIS, CNN PERSONAL FINANCE EDITOR: One want to knows if her bank cancel her home equity line of credit. You can still get your questions in at CNN.com/american morning am, answers after the break.
ROBERTS: We're "Minding your Business" and your money this morning with CNN's personal financial editor, Gerri Willis. She has been monitoring the blog this morning. A lot of questions coming in over. She's here to answer some of them. Good morning to you.
WILLIS: Good morning, John. Good to see you. Mora in Florida is writing in to us. She asks "I'm a homeowner in good standing with my bank. The bank took back my home equity line of credit because it said that my home no longer held it's original value. Is there any way I can get it reinstated?"
All right. Mora here's what you need to know, these helocs were typically cancelled using a computer program to find out who had loans in certain zip codes across the country. So it's not that they made a lot of decisions looking at your specific loan. Call-up your lender, call up your bank. Talk to you local bank officer or call the 800 number. Tell them that you think you should that have that heloc negotiated. Tell them your payment schedule. What you have been doing to make that payment good.
And question number two - from Chris in California writes, "I have a small business. I have exhausted all company and personal resources and I can no longer make payments. There is no further income coming in, can I file bankruptcy on the business and personally to protect my home and two income properties."
Well, Chris, the devil is in the details here. If you really kept your business separate and you had given no personal guarantees on that business, your house could be safe but you really need to talk to a bankruptcy attorney to make sure that you are OK. John.
ROBERTS: Got the opposite problem with Joe the plumber there, huh?
WILLIS: Yes, exactly. A sad story. And we're seeing a lot of those small business problem. Absolutely.
ROBERTS: All right, Gerri. Thanks very much. Don't forget, keep your questions coming in. Log on to CNN.com/am. It's 10 minutes now to the top of the hour.
CHETRY (voice-over): Swing state debate party.
UNIDENTIFIED FEMALE: I need to see where the Democrats are. Can I see a show of hands for Republicans?
CHETRY: We're taking the pulse of fired up Americans.
Plus, just 19 days to go, can John McCain make a comeback? James Carville joins us live with his advice for both campaigns. You're watching "the most news in the morning."
(BEGIN VIDEO CLIP)
SEN. JOHN MCCAIN (R), PRESIDENTIAL CANDIDATE: They are hurting right now and they are angry. They are hurting and they're angry. They are innocent victims of greed and excess on Wall Street and as well as Washington, D.C. and they are angry. And they have every reason to be angry. And they want this country to go in a new direction.
(END VIDEO CLIP)
ROBERTS: Senator John McCain last night in the final presidential debate. Both he and Barack Obama reaching out to voters during these rocky financial times. Did they make the connection? My next guest is an expert on voter psychology. Drew Westin is the author of the "Political Brain." and he joins me now, live from Atlanta. And of course, Drew, your prevailing theory in the book is that people vote for somebody who they feel that they can connect with. Somebody that they feel comfortable with. Did John McCain make that connection last night?
DREW WESTIN, AUTHOR "THE POLITICAL BRAIN": Yes, I think he sort of connected and then disconnected. I think, at first he came -
ROBERTS: That's not good.
WESTIN: Well, I think at first he came on and did a really nice job. I think his introduction he felt personable. He felt like he felt people's pain, to use Bill Clinton's term. And then he had a little trouble a little later on with disconnection.
ROBERTS: There was a particularly testy exchange when the subject of negative campaigning was brought up. Let's listen to that exchange and then we'll get your analysis of it.
(BEGIN VIDEO CLIP)
OBAMA: What we can't do, I think is try to characterize each other as bad people.
MCCAIN: You asked me a direct question about it -
MODERATOR: Short answer, yes, real quick.
MCCAIN: Mr. Ayres, I don't care about an old washed up terrorist, but as Senator Clinton said in her debates with you, we need to know the full extent of that relationship.
(END VIDEO CLIP)
ROBERTS: That was the exchange. We should mention, Drew, that you are an Obama supporter but you're also an expert in these matters. You say that Obama resonated with voters in the exchange. McCain went south. Why?
WESTIN: Well, Obama gave this very, sort of impassioned plea for, let's get away from the politics, the personal destruction. Let's not attack each other's character. Let's talk about what matters to people. He did a really nice job of it. He was connecting. If you look at the dials, he was just, he maxed out for both the men and the women. And McCain then jumped in in a very, very aggressive way that was just - it was ill timed, and he sounded - he just sounded like he was angry and ready to pounce. And it was just the wrong time. At another time during the debate it might have been a much stronger response.
ROBERTS: One question to Senator Obama during the debate was about Sarah Palin. Let's see to how he fielded that question.
(BEGIN VIDEO CLIP)
OBAMA: Obviously, she's a capable politician. Has, I think, excited the base in the Republican party. And I think it's very commendable the work she has done on behalf of special needs.
(END VIDEO CLIP)
ROBERTS: Now, Drew, you say that was a missed opportunity on the part of Senator Obama. How so? What should he have said?
WESTIN: Well, the Obama campaign has clearly made a decision that they are just not even going to talk about Sarah Palin and they're going to talk as if she doesn't exist or if she does, she's fine. And I think a lot of voters have a lot of concerns about her. So for him to take such a pass was - again if you watch the - if you watch the lines, he was a flat line during that. Because people were expecting him to say something about her that - is she ready to lead, and he didn't do it.
ROBERTS: You know, for people who are watching the debate on CNN last night, they would have seen a split screen between the two candidates. And you can see the candidate's reaction while the other one was speaking. And you know, we looked at some of the video of that. You can see that Senator Obama had a couple of grins or sort of laughs that were kind of dismissive of John McCain. John McCain had some pretty profound eye rolls at a couple of points. How do viewers respond to that sort of thing?
WESTIN: Well, it's - I have to say for both of them, it's a really tough thing to be up there and to have that split screen and people be looking at you while you are responding or you don't know whether you are on the camera at any given time. I think most of the time what Barack Obama projected was a kind of a presidential quality that he's really needed to project with voters. McCain, this was clearly his most dismissive body language. He even through in a sigh there for Al Gore's benefit. It was probably not exactly what you want to do. I think David Gergen said last night that it looked like an exercise in anger management at one point.
ROBERTS: We all remember those sighs in that 2000 debate between Al Gore and Governor Bush.
Drew Westin, author of "The Political Brain." Thanks for being with us this morning with your analysis. Good to see you.
WESTIN: Thanks for having me back on.
CHETRY: And coming up on two minutes before 8:00 here in New York. A look at the top stories this morning. The presidential debate season is over. John McCain attacked Barack Obama's tax plan and also his relationship with former 60s radical William Ayers. And Obama pushed back saying that when it comes to the economy, John McCain equals George Bush. In a moment, new poll numbers on who came out on top.
Meantime, the financial markets still looking bad this morning. Asian markets plunging overnight. Japan's Nikkei losing more than 11 percent. The largest percent drop since 1987. Hong Kong's Hang Seng off nearly five percent. European markets trading in negative territory. Right now that we have Dow futures trading higher. Coming off yesterday's 733-point drop. That's the second biggest point drop ever.
And hurricane Omar roaring across the Caribbean right now and soaking the Leward Islands with up to 20 inches of rain right now. The category 3 storm packing winds of 125 miles per hour. It's expected to weaken in the next 24 hours as it heads toward the open waters of the Atlantic.
19 days away from the election. And we have new poll numbers about the final presidential debate. 58 percent of viewers watching the two say that they felt Barack Obama did the best job. 31 percent said they felt john McCain did the best job. 54 percent said McCain seemed like a typical politician compared to 35 percent who said Obama did. And on health care, 62 percent said that Obama would handle the issue better. 31 percent thought McCain would. Health care was just one of many battle lines drawn last night. (BEGIN VIDEO CLIP)
MCCAIN: Senator Obama wants to set up health care bureaucracies, take over the health care plan of America through - as he said, his object is a single payer system. If you like that, you'll love Canada and England.
OBAMA: Under Senator McCain's plan, there is a strong risk that people would lose their employer-based health care. That's the choice you'll have as having your employer no longer provide the health care.