David Axelrod, Rick Davis exchange blows on “Fox News Sunday”

SHARE David Axelrod, Rick Davis exchange blows on “Fox News Sunday”

Transcript courtesy Federal News Service




9:00 A.M. EDT, SUNDAY, OCTOBER 12, 2008

MR. WALLACE: I’m Chris Wallace, and this is “FOX News Sunday.” (Intro music plays.)

The presidential candidates try to get a handle on America’s financial crisis.

SEN. BARACK OBAMA (D-IL): (From videotape.) This is the kind of erratic behavior we’ve been seeing out of Senator McCain.

SEN. JOHN MCCAIN (R-AZ): (From videotape.) Do you want to help the homeowners of America or do you want to help Wall Street? That’s the question here.

MR. WALLACE: With 23 days left till the election and the markets tumbling, which candidate can convince voters he’ll fix the economy? We’ll ask the top men for both nominees, McCain campaign manager Rick Davis and David Axelrod, chief strategist for the Obama campaign.

Davis and Axelrod, only on “FOX News Sunday.”

Then, what effect is the economic crisis having on the electoral map? We’ll talk with the governors of two key battleground states — Democrat Ed Rendell of Pennsylvania and Republican Tim Pawlenty of Minnesota.

Plus, Alaska investigators say Sarah Palin abused her powers. The governor says, not so fast. What’s the political fallout? We’ll ask our Sunday Regulars: Brit Hume, Mara Liasson, Bill Kristol, and Juan Williams.

And it’s getting ugly out there as we go On the Trail. All right now on “FOX News Sunday.” (Intro music ends.)

And hello again from FOX News in Washington. Well, it was a wild ride on Wall Street this week, and one of the roughest so far on the campaign trail. We’ll talk about the financial crisis with our two governors in a few minutes, but first, the rough back-and-forth between the candidates.

And we’re joined by Rick Davis, McCain’s campaign manager, who is here in Washington, and from Chicago, David Axelrod, chief strategist for Obama.

Well, let’s start with the latest controversy over angry rhetoric at McCain campaign rallies. Yesterday, Congressman John Lewis, the civil rights leader, compared it to segregationist George Wallace back in the ’60s. Let’s put up what he said.

“What I am seeing today reminds me too much of another destructive period in American history — Senator McCain and Governor Palin are playing with fire, and if they are not careful, that fire will consume us all.”

David, Congressman Lewis later backed away from the comparison with Wallace, but the Obama campaign, while they said that they do not see any comparison to George Wallace, did condemn what it calls hateful rhetoric. Such as?

MR. AXELROD: Yes. Well, they haven’t — we’re not the only ones who have condemned it. Editorial pages across the country have condemned it. Other public officials, Republicans like Governor Milliken, former Governor Milliken from Michigan; Ray LaHood, a congressman from Illinois, a Republican, have all condemned it.

Because when you stand up and you say someone’s been palling around with terrorists, they don’t see America the way we see it, you don’t really know who he is and so on, and people start yelling kill him, bomb him, off with his head, that is not where we want to take politics in this country.

A week ago, Chris, an official of the McCain campaign said we don’t — we’re going to start aiming at his character because if we have to talk about the economy, we’re going to lose.

And the economy does hang from their neck like the anchor from the Lusitania; I understand that. But this is really not the place we want it. We’ve got to pull together as a country. And there are parameters, and those parameters have been crossed.

Now, we give Senator McCain credit for, at the end of the week, taking on a couple of these comments in his appearances. But the ads are continuing to drive this, and you have to take responsibility.

MR. WALLACE: Well, Rick Davis, let me bring you in.

It is a fact that has been reported by reporters who have been at these rallies that some people in the crowds — not the majority, but some people in the crowds have been saying terrorist, kill him, off with his head.

Do Palin and McCain bear some responsibility for — in their ads and their campaign stumps, calling Obama a liar who pals around with terrorists?

MR. DAVIS: Look, Chris, I think we have to take this very seriously. And the kind of comments made by Congressman Lewis, a big Obama supporter, are reprehensible. The idea that you’re going to compare John McCain to the kinds of hate spread in the ’60s by somebody like George Wallace is outrageous.

Where was John McCain when George Wallace was spreading his hate and segregationist policies at that time? He was in a Vietnam prison camp serving his country, with his civil rights also denied. Nobody knows sacrifice like John McCain does.

And the idea that Barack Obama did not address this issue directly — had his campaign walked out with a half-baked statement that didn’t even address the comments by Lewis as it related to John McCain — Barack Obama should apologize to John McCain directly for the kinds of comments made by John Lewis yesterday, and that should be the end of this sordid affair.

MR. WALLACE: But let me —

MR. DAVIS: Now, the reality is — the reality is —

MR. WALLACE: Let me —

MR. DAVIS: You didn’t interrupt him. Let me speak to this.

You asked what were the things said that would be considered this kind of remarks that would drive this kind of hate. And what did Mr. Axelrod say? Nothing. He went into a diatribe about attacking John McCain.

Do we not think that the relationship between Bill Ayers and Barack Obama bears some scrutiny? Because the press will not ask any questions about Barack Obama’s background, it is a legitimate question.

There are voters all over the country who say we don’t know enough about this man. What is his experience? What informs his judgment? What will make him a president of the United States?

And I think filling in those blanks is essential to having a dialogue on this campaign.

MR. WALLACE: So you have — so — I’m going to ask him whether he apologizes for what John Lewis said, but I want to ask you directly, you don’t back off at all the comments that McCain and Palin have made that Obama lies, he’s a liar and he pals around with terrorists?

MR. DAVIS: Well, my God, Obama’s campaign commercials themselves call John McCain a liar. John McCain’s never used the liar phrase until Barack Obama put it up on air.

Obama has a whole habit of doing this. Back in the days when he used to make statements like oh, they’re going to call me risky; they’re going to think that I don’t look like one of those guys on the face of the dollar bill.

You know what he did next? He then ran an ad against John McCain calling him risky. I mean, that’s the most hypocritical statement I’ve ever seen. I mean —

MR. WALLACE: All right. Now — wait —

MR. DAVIS: Let’s be fair about this.

MR. WALLACE: Okay, and I want to be —

MR. DAVIS: There is absolutely nothing being done in our campaign that hasn’t already been done first by Barack Obama.

MR. WALLACE: I want to be fair and I want to ask Mr. Axelrod, do you condemn the comments made by Congressman Lewis?

MR. AXELROD: Well, let me just say, before I answer that question, if anybody has any questions about risky, they ought to take a look at how Senator McCain has been handling this financial crisis in the economy for the last couple of weeks, and I think it will underscore the point.

MR. DAVIS: David, that’s got nothing to do with the question. Why don’t you answer his question about John Lewis?

MR. AXELROD: But look, we made — we issued a statement right away and said there’s no comparison between George Wallace and John McCain. But what I haven’t heard Rick say —

MR. DAVIS: Who’s we? Was it Barack Obama who issued that statement?

MR. AXELROD: What I haven’t heard Rick say is that there’s anything wrong with the kind of statements that are coming out in this rallies, and that’s the issue. Are you going to speak out against that kind of — kill him —

MR. DAVIS: Oh, absolutely. Look, I’ll say right away, for the record, there’s absolutely nothing appropriate about those statements. But I would also say for the record —

MR. AXELROD: And you don’t think that —

MR. DAVIS: — that there’s absolutely nothing being done on the stage by our candidates, John McCain or Governor Palin, that would incite that kind of thing.

MR. AXELROD: Well, I disagree with that. I disagree with that, Rick

MR. DAVIS: You know, people are angry right now, and one of the things they’re angry about is the campaign that you’re running doesn’t answer the simple questions, just like you’ve just shown you’re not willing to answer Chris’s questions.

MR. AXELROD: No, Rick. What they’re angry about is that they can’t pay their bills; they can’t get a loan, they’re worried about their jobs; they’re worried about their health care —

(Cross talk.)

MR. DAVIS: Oh, I agree, which is why they’re coming to McCain rallies and they’re hoping that he’ll become elected president so that he can — (inaudible) — their taxes and generate economic growth.

MR. AXELROD: — and what they hear from the McCain campaign is they don’t want to — what they hear from the McCain campaign is we don’t want to talk about the economy because we’ll lose. So we’re going to throw a bunch of bogus, inciteful — (inaudible).

MR. DAVIS: No, that’s what they incite in your campaign —

(Cross talk.)

MR. WALLACE: All right. All right, all right. Gentlemen –as I said before this, let’s break clean on the clinches and let’s go to the next point.

But on Friday, Rick, McCain tried to calm things down because he felt that the anger at this one rally was getting out of hand. I want to run a clip from one of your recent ads and then what McCain said at the rally. Take a look.

(Video clip begins.)

ANNOUNCER: Obama’s blind ambition. When convenient, he worked with terrorist Bill Ayers. When discovered, he lied. Obama — blind ambition, bad judgment.

SEN. JOHN MCCAIN (R-AZ): He is a decent person and a person that you do not have to be scared as president of the United States. Now — (crowd boos) — I just — and I just — now, look. If I didn’t think I wouldn’t be one heck of a lot better president, I wouldn’t be running, okay?

MR. WALLACE: Here’s the question I have for you, Rick. If McCain stands by that ad and — that Obama is consorting with a former terrorist, blind ambition, bad judgment, lies, why shouldn’t we be scared about Barack Obama as president?

MR. DAVIS: Well, look, you’re going to make your own judgment based on that. John McCain —

MR. WALLACE: Well, no. John McCain — it was his judgment.

MR. DAVIS: First of all, let’s be clear. The person who he is addressing specifically said very nasty things about Barack Obama that had nothing to do with that commercial. He was addressing someone who stood up in one of our town halls —

Which, by the way, we let anybody who wants to come to our town halls. We don’t require any kind of checks. Anybody can stand up in those town halls and say anything they want to John McCain.

Sometimes they say inappropriate things.

In this case, it had nothing to do with that commercial, so I wouldn’t mix and match them.

It is a fact —

MR. AXELROD: That’s — (inaudible) — not true. It’s not true. He was repeating — are messages of a false commercial. Your commercials are designed to incite people. He was repeating the message of that commercial

MR. DAVIS: That’s absolutely not true. That commercial is exactly accurate.

Why don’t you answer the question as to why it’s so confusing on your Web site, David —

MR. AXELROD: Let’s — let’s talk a for a second, Chris, about his commercials.

MR. DAVIS: — about whether or not John McCain — or, whether or not he’s in a relationship with Mr. Ayers?

MR. AXELROD: I want to talk about those commercials.

MR. DAVIS: Is Mr. Ayers a part of his history?

MR. WALLACE: Well, wait. Wait, wait. All right. Let’s give Mr. Axelrod — I am going to get to Ayers in a moment, but —

(Cross talk.)

MR. WALLACE: Go ahead, David.

MR. AXELROD: Well, let’s talk about their commercials. They’re running commercials right now with Bill Ayers in them and, in the same commercial, they attack Senator Obama for his support from Bill Daley, the former Commerce secretary who was confirmed by Senator McCain’s committee and who — McCain called one of the great Commerce secretaries in history. And now they’re attacking —

MR. DAVIS (?): I’m sorry.

MR. WALLACE: (Inaudible.) I don’t want to argue about that.

(Cross talk.)

MR. WALLACE: Guys, let me —

MR. AXELROD: No, but my point is all of these commercials —

MR. DAVIS: (Inaudible) — all the people who you’re attacking in your commercials that — who are part of the McCain —


MR. AXELROD: All these commercials are designed to —

MR. DAVIS: (Inaudible) — character assassination at the hands of Barack Obama. It’s very simple.

MR. AXELROD: Are designed to distort and inflame.

Let’s talk about Bill Ayers.

MR. WALLACE: Let’s talk about Bill Ayers. And David —

MR. DAVIS: (Inaudible.)

MR. WALLACE: No, David, it’ll work better if I ask the question and then you answer the question.

MR. AXELROD: Well, tell that to your guest as well.

MR. WALLACE: This week Obama said that after — that when he learned that Ayers had been a terrorist — and let’s put it up on the screen — “given his standing in the community, I assumed he had been rehabilitated.”

Does Obama think that you can ever be rehabilitated after bombing the Pentagon and the Capitol?

MR. AXELROD: Chris, he has condemned those things. And that happned when he was eight years old. And of course, you can never take those back. He condemns those acts.

But let’s talk about the boards that he was on. On those boards —

(Cross talk.)

MR. WALLACE: I’m — but can he be — he used the word rehabilitated.

MR. AXELROD: No, no, no, no. This is important, Chris. This is — he said at the time he thought he was rehabilitated. But let’s go forward here and talk about these boards that Rick and the commercials are talking about.

Who was on these boards? The publisher of the Chicago Tribune, right? A newspaper that hasn’t endorsed a Democrat in 150 years. Is he consorting with terrorists?

The head of the largest business group in Chicago. Is he consorting with terrorists?

MR. DAVIS: Well, David, I don’t any of these people are running for president of the United States and I don’t think anybody in this group has actually misled the public about what their relationship was.

MR. AXELROD: These were — no, but it’s very important because these were boards that Obama served on in order to promote education reform in the city. — (Inaudible) — the most respectable people in the city, conservatives —

MR. DAVIS: That’s right —

(Cross talk.)

MR. DAVIS: — develop a relationship with William Ayers.

MR. AXELROD: Conservatives — conservatives —

MR. DAVIS: And then he spent the next five years trying to obfuscate the relationship that he had with him.

MR. WALLACE: All right. Rick —

MR. AXELROD: No, he’s not obfuscating anything, Rick.

MR. DAVIS: Sure he did. The first time he was — (inaudible) —

MR. AXELROD: He’s not obfuscating anything. You —

MR. DAVIS: — just somebody from my neighborhood, denied that he actually attended one of first political events in William Ayers’s home.

MR. WALLACE: All right. But Rick, let me follow up on this. Obama —

(Cross talk.)

MR. WALLACE: Excuse me, gentlemen. Obama asked a pretty good question this week, and I want you to take a look at it.

SEN. BARACK OBAMA (D-IL): (From videotape.) I am surprised that — you know, we’ve been seeing some pretty over-the-top attacks coming out of the McCain campaign over the last several days that he wasn’t willing to say it to my face.

MR. WALLACE: You, obviously, have no problems confronting David Axelrod about William Ayers.

Will John McCain confront Barack Obama about his relationship with William Ayers and explain why it’s relevant at the debate on Wednesday?

MR. DAVIS: Oh, I don’t know what’s going to happen at the debate on Wednesday, and it depends upon the kinds of questions that the moderator asks. I didn’t notice that the moderator asked any questions about Bill Ayers. I don’t notice that the press asked any questions to Barack Obama about Bill Ayers.

I mean, this is one of the reasons why I think it’s a germane topic in this debate, because the press has basically given a free pass to Barack Obama so that none of his background gets challenged.

And so whether it’s his relationship with Bill Ayers, his relationship with Tony Rezco, his relationship with the ACORN group that’s under investigation right now, and many other things.

If he would just come clean in the Obama campaign and actually tell the public what’s been going on in Obama’s life —

Look, there are legitimate questions about his experience and his background that deserve public scrutiny — (inaudible) — outcome of this election.

(Cross talk.)

MR. WALLACE: (Inaudible.)

MR. AXELROD: (Inaudible.) Chris — Chris, the fact is I think there’s been more written about Bill Ayers in recent days than any unknown public figure ever.

The fact is Barack Obama’s been scrutinized for 20 months. And I think what frustrates Rick is the American people are getting a clear picture of who these two candidates are and they’re making a judgment and they’re moving in Obama’s direction.

Because he’s a guy who’s actually addressing their concerns about the economy, about the future, and rack Davis and his campaign have made a judgment that they can’t compete on that, and so they want to throw out abstractions and character assassination —

MR. DAVIS: That’s not true, David. The reason — (inaudible) — talking about Bill Ayers is your campaign and your candidate keep changing the story on what the relationship is.

(Cross talk.)

MR. AXELROD: Every single charge you guys have thrown out — (cross talk) — every single charge that you’ve thrown out has been debunked by FactCheck.org and —

MR. WALLACE: All right. Gentlemen, enough about —

MR. AXELROD: And the news media have examined all of them. The news media has — (inaudible).

MR. WALLACE: Gentlemen? Enough about Bill Ayers. We’re going to move on to something else.

MR. DAVIS: (Inaudible.)

MR. AXELROD: — you continue to repeat it.

MR. WALLACE: David, an investigation by the Alaska legislature has found that Governor Palin abused the powers of her office by pressuring subordinate officials in the Alaska government to try to fire her brother-in-law, who was a state trooper.

Does Senator Obama believe that has any relevance to Palin’s fitness to be vice president?

MR. AXELROD: Well, voters are going to decide that, Chris. And one thing that is clear is that we’ve had examples of abuse of power in Washington over the last eight years that are concerning to people.

And we want — and certainly if we’re going to move this country forward and reform this government, then we certainly don’t want more of that philosophy in government.

But that’s up to voters to decide and to judge the facts of this case.

MR. WALLACE: Rick, the report said that Palin was within her rights to get rid of the public safety commissioner, but it also said that she violated the state ethics act by pressuring state employees to try to fire her brother-in-law. And this was approved unanimously by a bipartisan legislative council.

MR. DAVIS: Yeah, let me tell you. This whole thing has been a kangaroo court from day one. The person who was heading the investigation into this is one of Barack Obama’s biggest supporters.

This was going nowhere until the point at which Sarah Palin was asked to join our ticket, and at which point it became a big public circus. And frankly, everyone in Alaska has treated it as such.

The reality is there was absolutely no wrongdoing found in the report. A thousand pages, an enormous waste of time, and the best that they could come up with was no violations of any kinds of laws or ethics rules, but — but —

(Cross talk.)

MR. WALLACE: Well, no. It said she violated the state — (inaudible) — ethics board.

MR. DAVIS: But that she acted within her power and scope of authority as governor to do exactly what she did.

And so the bottom line is this thing now drops dead, and there’s absolutely no follow-up to this at all.

So — it was a great public circus.

MR. AXELROD: (Inaudible.)

MR. DAVIS: Look, David, I didn’t interrupt you when you were speaking, so —

MR. WALLACE: (Chuckles.) I think you both interrupted —

(Cross talk.)

MR. AXELROD: Well, you did, and you did it repeatedly, so — you interrupted — (inaudible) — this whole show.

MR. DAVIS: So the bottom line is David actually has a very good point. He says you know what we need to do is root out corruption.

John McCain is the only candidate for president right now who’s actually done anything about rooting out corruption in Washington. And do we really believe that the American public is going to feel safe by having both the head of the Congress and the head of the White House from the same party that’s had so many challenges with the way they’ve run Washington over the last couple of years.

So honestly, I really believe that is a germane — this may be one of the things that David Axelrod and I can leave the show actually agreeing on. I think it’s a major issue as to who’s got the track record and experience to root out corruption in Washington, and that’s only one guy on this campaign, and that’s John McCain.

MR. WALLACE: All right. David, you get the last word. And talk, if you will, about this argument that if you elect Obama and you have a strong Democratic majority in both the House and the Senate, you’re giving total control of the government to the Democrats.

MR. AXELROD: Look, I think the way you root out corruption in Washington is first take on the lobbyist culture. And you know what? We can’t have our lobbyists making millions of dollars selling access to public officials, as Rick has done selling access to Senator McCain.

MR. DAVIS: Well, David, what do you think you’ve been doing in your organization?

(Cross talk.)

MR. AXELROD: That is not how you clean up corruption in Washington.

MR. DAVIS: You even wrote an op-ed saying that you thought that the patronage politics of Chicago was a better model for Washington than the law and order model that we currently —

(Cross talk.)

MR. AXELROD: That is — I never — that is as untrue as everything else that you’ve said here. That is not what I said, Rick.

Why don’t you answer the question about whether you sell access to Senator McCain?

(Cross talk.)

MR. DAVIS: Well, if you want to talk about me —

MR. AXELROD: That’s been in reported in the newspaper. Is that false? Is it false that you sell access to Senator McCain?

MR. DAVIS: Well, I think — (inaudible) — your business in the newspapers.

(Cross talk.)

MR. AXELROD: No, answer the question. Do you sell access to Senator McCain? Isn’t that how you’ve made millions of dollars?

MR. DAVIS: No, I don’t. Not at all.

MR. AXELROD: You’ve never done that? You’ve never — nobody has ever been told that they ought to hire you if they want to get into Senator McCain —

MR. DAVIS: Let me ask you a question. Is this the kind of politics that you’re —

MR. AXELROD: I’m asking you a question.

MR. DAVIS: Character assassination has become the hallmark of the Obama campaign. This is the kind of thing that he just railed against when he first got on. Now —

MR. WALLACE: All right.

MR. AXELROD: (Inaudible.) Anybody who watches this show knows otherwise.

MR. DAVIS: Attack, attack, attack.

MR. WALLACE: Gentlemen, we’re going to have to end it there, and I’m glad to say that we settled all that.

MR. AXELROD: Thank you very much, Chris.

MR. AXELROD: David, it’s nice to see you on TV.

MR. WALLACE: Right. Wow. Thank you both for talking with us. See you both at Wednesday’s debate. Stay in opposite corners and break clean on the clinches.

Up next, this election really comes down to a just a few battleground states. We’ll talk with the governors from two of those states about the campaign and the financial crisis after this quick break.


MR. WALLACE: With just 23 days to go, how has the financial crisis changed the state of the race in key battleground states?

For answers, we turn to two leading governors. From Pennsylvania, Democrat Ed Rendell, who backs Obama. And from Minnesota, Republican Tim Pawlenty, who supports McCain.

Governor Rendell, the latest RealClearPolitics average of recent polls in Pennsylvania — and let’s put it up on the screen — shows Obama leading McCain by more than 13 points.

You said yesterday that McCain’s campaign strategy is, to use your word, dumb. Explain.

GOV. RENDELL: Well, I think the message in Pennsylvania, and I think it’s a national message, should be to the McCain campaign, look, before the economic crisis this was a two-point race in Pennsylvania. Since the economic crisis has happened, it’s blown out to 13 points.

Now, Chris, I don’t believe it’s a 13-point race. I believe it’s tighter than that. But certainly Senator Obama has lengthened his lead, and that should be a clear message to the McCain campaign that these personal attacks, these trying to describe Senator Obama as risky or we don’t know enough about him or whatever it is, they are not working.

Because when the economy’s in crisis, people want real answers. Mr. Davis once said, about a month ago, that this campaign isn’t about issues. Well, maybe that was the case before the economic meltdown. But now, with the economic meltdown, it is about issues, and people want to hear what the candidates are doing.

And Senator Obama has performed far better than Senator McCain the last five weeks.

MR. WALLACE: Governor Pawlenty, let’s take a look at the RealClearPolitics average of recent state polls and your state of Minnesota, which shows a slightly closer race — Obama up by more than eight points.

But that lead has lengthened in Obama’s favor in the last couple of weeks. Is that because Obama’s — or, rather, McCain’s strategy of personal attacks, going after Obama’s character, has backfired, or is it simply the fact that in an economic crisis people are looking to the party that’s out, and in this case that’s the Democrats?

GOV. PAWLENTY: Well, I think, Chris, Minnesota’s always a state that in presidential elections leans a little Democrat. It’s not impossible for a Republican to win here, and Senator McCain, I think, is going to close that gap, really for two reasons.

One is a point you made before the break, when people realize if they elect Barack Obama they’re going to have the entire nation run imbalanced and without a check by the Democrats, and I think people like balance, particularly in places like Minnesota.

And number two, if you’re going to play the Super Bowl, you don’t put a rookie in who hasn’t played in the league before. John McCain has the experience and the judgment and the wisdom and the maturity and the courage to lead this nation forward, in the economic areas as well as the national security areas.

I think people are going to come back to that reality as they get closer to the election.

MR. WALLACE: All right. Let’s talk about this question of divided government, because I did some research on it. Nineteen of the 31 elections since World War II have either produced or maintained a split government, in the sense that the White House and at least one of the chambers of Congress have been occupied by different parties.

And voters seem to like that agreement, which raises the question, Governor Pawlenty, instead of going after Obama on William Ayers or ACORN, the left-wing voter registration group, would McCain be better advised to go after Obama and his links to Nancy Pelosi and Harry Reid and the idea that if they all get elected they’ll pursue a left-wing agenda for this country?

GOV. PAWLENTY: Well, I think it is a fair question, Chris, to look at not only his associations, as it’s been called, with people like William Ayers and others, but is he being forthcoming about the depth and scope of those relationships? And that’s not the point that’s been featured in these discussions.

Now, the fact of the matter is Barack Obama’s political campaign in Illinois appears to have been launched in Bill Ayers’ living room. And so has he been truthful about that? Has he been forthcoming about that?

But beyond all of that, to the point you raise, I don’t think the country is going to like what — the Democratic Party running the table on taxes, on education, on health care, and have kind of the liberal, unchecked, imbalanced approach to all of those issues. It’s going to be bad for the country.

I think having John McCain as president to balance that out and be able to work across the aisle, as he has throughout his career, to get things done would be a good compromise; a good balance.

MR. WALLACE: Governor Rendell, don’t middle-of-the-road, swing voters have legitimate reason to worry about where an Obama White House and a Pelosi House and a Harry Reid Senate, possibly with a veto-proof majority, would take the country?

GOV. RENDELL: No, I don’t think so, Chris, at all, and let me tell you why.

I think Americans know we need our government to respond and respond quickly to the challenges we’re facing, like the economy, like what’s happening abroad, like the health care crisis in this country. And I think they see the opportunity for a cohesive government to do something about that.

Let me tell you what a divided government does. Governor Pawlenty and I were the chairman and vice chairman of the National Governors’ Association together, and Tim was the chair and I was the vice chair. We were trying to get the Congress to override the president’s veto of the extension of the children’s health care program.

We couldn’t get the override done and, as a result, 9 million children in this country are not going to get health care unless we can reverse that decision. And that was because we had a divided government with two different philosophical views of things which couldn’t mesh. You can talk about reaching across the aisle all you want, but on that it was pure philosophy.

I want to say two things, if I can, about what Tim said. Number one, he called Senator Obama a rookie. I think you’ll agree, Chris, that in those two debates with Senator McCain, Senator Obama looked anything but a rookie.

And then secondly, Tim talked about taxes. Well, the American people are finally getting the truth about taxes, and that is if you’re a family that earns less than $250,000, not only is Senator Obama not going to raise your taxes, he’s going to give you a bigger tax cut than Senator McCain will.

MR. WALLACE: All right. Let’s talk about the financial crisis, the market crisis that we’re in right now.

Governor Pawlenty, at the debate this week McCain announced a new $300 billion bailout that would buy up all the bad mortgages, renegotiate them at lower prices, with taxpayers — not lenders — footing the bill.

Not only has this been hammered by Obama, but also from some staunch conservatives. For instance, Dan Mitchell of the CATO Institute said, “It puts McCain to the left of Obama. It just rewards people who are speculative and irresponsible, and punishes people who are prudent.”

As a fiscal conservative, Governor, can you explain why the taxpayers should end up footing all the bill for this $300 billion bailout and the predatory lenders should basically come out even?

GOV. PAWLENTY: Well, Chris, first of all, on the proposal that you’ve referenced, Senator McCain believes that the money that the federal government is already going to be committed to spend shouldn’t all go to bankers and Wall Street types and hedge fund managers and others, that some of it, a good portion of it, should go to Main Street America and rank-and-file Americans who are suffering. So it’s an effort to bring some balance to the package in the dispersion of the funds that already are going to spent to Main Street, rather than to just Wall Street.

He also realizes that if we don’t do something to get at the root of this cause, which is declining home values, he believes that the problem is going to continue to spiral downward. So he’s trying to get at the root cause, which is home values and bad mortgages.

If I could jump back to one thing Senator — or, Governor Rendell said earlier, in that divided government scenario he and I were trying to deal with that children’s health care issue, but it actually worked in the sense that Republicans were against tax increases, for the most part.

I, for one, and others said the president shouldn’t be expected to sign those tax increases into law. And the benefits in that program were being extended to people who could make as much as 800,000 — or, excuse me, 80,000 (dollars) under certain scenarios.

So bringing some balance to that issue is important. We all are in favor of preserving those programs, but bringing some balance to how you do that. And had the Democrats been in complete control, there would have been imbalance. So that’s a perfect example of trying to keep it in check, keep it in balance.

MR. WALLACE: And Governor Rendell, we’ve only got a couple of minutes left and I want to change subjects on you.

No matter what Obama’s lead is in this race, some analysts suggest that there is going to be a race factor, a racial factor, on Election Day — that some people who say that they’re going to vote for Obama will not do so when they’re in the privacy of the voting booth.

Now, during the Pennsylvania primary you had this to say: “You’ve got conservative whites here, and I think there are some whites who are probably not ready to vote for an African American candidate.” You said that in your race two years ago against Lynn Swann, who’s an African American, you felt that it probably cost him five points in the polls.

Are we talking about that big a factor, five points, that secretly is going to be lost in Obama’s standing in the polls?

GOV. RENDELL: No, I don’t think so, Chris. Because the economic crisis has thrown all that out the window.

If you’re drowning and you’re in the middle of the river and you see a guy on the riverbank and he’s got a coil of rope, you don’t care whether he’s black, white, green, purple. All you care about — whether he has a strong enough arm to get that rope out to you in the middle of the river.

Barack Obama’s got that strong arm. He’s got a great plan to grow our way out of this crisis with investments in infrastructure, investments in renewable energy, investments in life sciences, cutting taxes for the middle class, cutting health care premiums.

Those are the things that are going to turn this economy around, not what we do on Wall Street, but what we do in people’s hometowns. He’s got a great plan. (Cross talk.) That’s all people are interested in.

MR. WALLACE: All right, Governor Pawlenty, real quick, please.

GOV. PAWLENTY: Well, you want somebody who’s going to throw the rope who’s actually practiced it and done it before.

Barack Obama hasn’t led the nation on one issue of national significance; John McCain has.

You want the seasoned veteran, the grizzly, courageous, honorable, patriotic person in there who’s done this before.

GOV. RENDELL: (Chuckles.)

And Barack Obama has a lot of talent, but he’s a rookie. He has not been in the big leagues in terms of leading the nation on national issues, and this is not the time to put the rookie in the game, right on the day before the Super Bowl.

GOV. RENDELL: Hey, Chris, I have to do a little bragging on the Philadelphia Phillies. Ryan Howard is a rookie, and I noticed he hit the most home runs in the National League, more than a lot of those grizzly veterans, Tim.

MR. WALLACE: (Laughs.) All right. Governor Pawlenty, Governor Rendell — and somehow I knew, Governor Rendell, you were going to get the Phillies into this discussion.

Thank you both. Thanks for talking with us, both of you. Please come back.

GOV. PAWLENTY: All right. Thanks, Chris.

MR. WALLACE: Coming up, our Sunday Regulars weigh in on a tough week on the campaign trail and demands from supporters that McCain should take it to Obama.

Stay tuned.


TOWN HALL AUDIENCE MEMBER: (From videotape.) When you have an Obama-Pelosi and the rest of the hooligans up there gonna run this country, we got to have our head examined. It’s time that you two are representing us, and we are mad! So go get ’em! (Cheers.)

MR. WALLACE: That was just one of many instances this week when the crowds at McCain rallies lashed out at Obama and urged McCain to go after him even harder.

And it’s time now for our Sunday Group: Brit Hume, Washington managing editor of FOX News, and FOX News contributors Mara Liasson of National Public Radio, Bill Kristol of The Weekly Standard, and Juan Williams, also from National Public Radio.

So Brit, what about this whole controversy about the anger of the crowds at McCain rallies and the rhetoric that’s come from McCain and Palin? Do you think it’s over the line?

MR. HUME: The rhetoric or the crowds?

MR. WALLACE: Well, both. The rhetoric from the candidates and the rhetoric from the crowds.

MR. HUME: Well, as Rick Davis was saying, they let anybody who wants to come in to those rallies and town hall meetings come in, and if you do that, you get what you get.

Obviously there are some people who are alarmed by Obama, but I don’t think for a moment that the issues that have been raised by the McCain campaign and the things that he has said are over the top in terms of political rhetoric.

I mean, it’s been intense; it’s been feisty, it’s been at times harsh and negative. But over the line? I don’t think so.

MR. WALLACE: Mara, what do you make of the fact that by the end of the week, here you have McCain on the one hand running ads saying he’s consorting with terrorists and he’s a liar, bad judgment, blind ambition — or maybe it was the other way around. But on the other hand, he ended up telling a member of the crowd don’t be scared of a President Obama.

MS. LIASSON: I think those are two different things. I think, juxtaposed, it looks like it’s a metaphor for the McCain campaign, which has been flailing around a bit, as people who are behind usually do because they’re trying to figure out — find something that works, and nothing has been lately.

But he was responding to somebody in the audience who said something angry and maybe personal, something that was a little ugly directed against Obama, and he wanted to make sure that the — that he was respectful, and he admonished the guy.

The ad is something a little bit different. It’s about Obama not telling the complete truth of what he knew about Ayers. Saying somebody has blind ambition and lies is par for the course in a political campaign.

I do think, however, when you read stories that somebody at a Palin rally yelled kill him, or off with his head or something like that, it is incumbent upon the candidates, either at that rally if they hear it, or at least at the next public event, to say something — the way McCain did in that town meeting — to kind of make sure that they set the tone the w ay they want to.


MR. KRISTOL: (Chuckles.) Yeah. Look, I think McCain did the right thing on Friday and I think the campaign has been —

The main thing to say about these negative ads, which I don’t think mostly — well, none of them has been across the line — they haven’t worked. Obama’s favorable rating is as high as it’s been in three months. It’s actually gone up in the last month.

So it’s a stupid campaign. It’s not a horribly mean-spirited or racist or disgraceful campaign, but it’s really become a pathetic campaign in the sense that there’s no strategy; they’re flailing around. They do things that don’t work and keep on doing them.

They’re out of sync with their own candidate now, which allows everyone to say well, why is Senator McCain saying this? If Senator McCain is willing to say these things, then the campaign and the candidate should say them. If he’s not willing to, adjust the campaign.

Otherwise, you’re just setting yourself up for what we’ve seen, which is Senator Obama, quite correctly, saying hey, what’s going on here? He won’t say this to me and his campaign is saying it in ads?

MR. WALLACE: So are you saying, Bill, you don’t think that he should be bringing up William Ayers and ACORN and all of that?

MR. KRISTOL: I think either Senator McCain should decide that he’s willing to bring them up and make a sustained — criticism and explain what the problem with Ayers is, which is he’s a radical in educational policy and a former terrorist, and Obama has consorted with him some and then —

But it’s crazy then not to bring up Reverend Wright, who has been his pastor for 20 years until this year.

MR. WALLACE: But I’m confused. Are you saying that he —

MR. KRISTOL: I’m saying be consistent. If you decide — if the McCain campaign decides that they want to make the fundamental issue Obama’s character and trustworthiness, I think that’s a legitimate — (inaudible).

MR. WALLACE: But you don’t seem to think that that’s the right case to be making anyway.

MR. KRISTOL: I think they’ve tried in a half-hearted way. They’ve done it enough that they’ve probably discredited it in the sense that it hasn’t worked, and now it will just look more desperate to do it.

So I think now, frankly, they should pivot. I don’t think it was illegitimate. I think it’s — I myself have raised the issue of Wright.

It discomforts me. But you’ve got to raise it in a consistent and coherent way. You can’t sort of do it half-heartedly and half the time and flail around and then back off, and that’s what the campaign’s been.

MR. WILLIAMS: Well, what you’re seeing is frustration on the part of not only McCain’s campaign, but McCain supporters. And I think that’s why you’re getting all this ugliness, this off-with-his- head, this racial epithets being shouted and the like. It’s very unattractive.

But I must give John McCain some credit here. I think McCain did speak out. And secondly, I think John McCain has been the one who’s tried to hold the line on Reverend Wright.

Now, I actually think that Reverend Wright’s a legitimate issue to be discussed, because it’s a 20-year association, but I understand where John McCain feels that it might be, in fact, inciteful. So okay, let’s move on.

So then how do we get, then, to the core issue here? The problem for McCain is he’s losing right now with women voters in a way that he wasn’t losing, even a month ago. I think it’s gone from — in the latest FOX News/Opinion Dynamics poll — went from plus-four for Obama with women to plus-16.

So when Bill talks about it not working, you’re talking about these direct, economic issues and the response from the candidates on these economic issues, that women voters in specific are finding what Obama has to say, and Obama’s rhetoric, more — gives them a sense of comfort, that he cares about them, that he is willing to speak to these issues in an effective way, versus McCain, who talks about the fundamentals of the economy being strong. And people are saying you know what, I think this guy doesn’t get it.

MR. HUME: Chris, I think to some extent we’re ignoring the elephant in the corner of the room here. What we’re doing is talking about political tactics, which really are fun to talk about, in the aftermath of a political earthquake. And I’m talking, of course, about the financial crisis.

If we’d sat around this table and tried to think of a way to blow up the McCain campaign — which had, I think, to a great extent, been kind of defined political gravity for most of the year by a series of decisions and efforts that proved, for a time, at least, to be agile — we could hardly have done better than to dream up an extreme credit crisis leading to a near crash in the stock market with a month till the election. I guess we could have put it two weeks till the election; that might have been more effective.

But the McCain campaign and Republicans across the country have been devastated by this. And this is the central event now in the current stage of this campaign.

And it might have helped some if McCain had appeared to be more consistent and had a sensible and consistent message about what to do about this. He didn’t seem to. His efforts to try to get in in the middle of the solution to the crisis seemed to backfire. Some of that was unfair, but that’s the way it is.

But that is where we are in this race, and that is the key event.

MR. WALLACE: So, Mara, is it impossible — is this — Brit said an earthquake; I’ll call it a political tsunami. The country generally turns to Democrats when there’s an economic crisis.

MR. HUME: (Off mike.)

MR. WALLACE: You’ve got a Republican president, so he’d — then that, maybe McCain is being tarred with that brush. Is there anything McCain can do to get out ahead on the issue of central concern to people?

MS. LIASSON: Well, I asked this question to everybody, Republicans and Democrats, and I haven’t heard a good answer — short of something that’s beyond his control, like some sort of foreign policy crisis that would —

MR. WALLACE: No, but I’m talking about something he — (inaudible) — affirmatively could do on the economic crisis.

MS. LIASSON: No. I think there’s very few things he can do. I think there is this notion on a campaign that if only x candidate was doing this, he could turn it around.

I agree with Brit. This race, more than most, is being run by the fundamentals, and they are pretty extreme right now. And I think that Barack Obama is riding a wave and John McCain is getting battered by it.

And although I think the John McCain campaign could have done many, many things different — there was never a reform agenda; he could have started earlier with some of this maverick talk — I think that it might be a little late now.

Look what happened when he dropped this new policy proposal into the midst of a debate. It looked like a gimmick.

MR. KRISTOL: Well, it was a gimmick. It wasn’t prepared properly. They changed it overnight. That’s — I agree that it’s a tough political environment that’s gotten tougher, but I think it’s being used as too much of an excuse, frankly, for the McCain campaign.

Let’s talk about this morning. Rick Davis comes on the show and screams and yells at David Axelrod. They scream and yell at each other. You invited Sarah Palin on. You would have had John McCain on. They would have had 20, 30 minutes with you, you asking questions, unfiltered, making their case to the American public.

McCain is an attractive, impressive character. Palin is an attractive and impressive character. Why isn’t Sarah Palin on this morning instead of Rick Davis? It is ridiculous. It is malpractice.

It’s a tough environment. Maybe they would have lost anyway because of the economic developments. But to do what they’re doing is inexplicable to —

MR. WALLACE: Let me just say, that is such pure reason on the part of Bill Kristol — (laughter) — that we’re going to end this panel on that subject. You said it all. What can I say, Bill?


We have to take a break here. Coming up, we’ll take a closer look at the financial crisis and ask if there’s anything the government can do to stop the bleeding. Back in a moment.


MR. WALLACE: On this day in 2000, suicide bombers attacked the USS Cole, killing 17 American sailors. While the Cole was refueling in a Yemeni port, two bombers rammed a barge full of explosives into the Navy destroyer.

Stay tuned for more from our panel and On the Trail.


PRESIDENT GEORGE W. BUSH: (From videotape.) We will stand together in addressing this threat to our prosperity. We will do what it takes to resolve this crisis, and the world’s economy will emerge stronger as a result.

MR. WALLACE: That was President Bush expressing resolve in dealing with the financial crisis after meeting with top officials from the leading industrial democracies.

And we’re back now with Brit, Mara, Bill, and Juan.

Well, the G-7 has taken — and that’s the leading, the seven leading industrial democracies — has taken unprecedented action this week. It’s pumped billions of dollars into them markets. It’s now starting to buy up equity positions in major banks.

And none of it has stopped what someone this week called — and I must say, I like them metaphor — a slow-motion crash.

Juan, why not?

MR. WILLIAMS: Because psychologically people just lack confidence. And they lack confidence in the leadership, and the leadership especially here in the United States.

Initially people thought it was just going to be an American problem. Obviously, it’s a global problem, because we have a global economic structure at this point.

But the confidence that would have been born, you would have thought, from the bailout bill never has come about — I think, because it was bungled and badly handled here, and secondly, confidence in President Bush, despite his many statements. It’s almost like he’s speaking in a private cell. Nobody seems to hear or respond when he comes out in the Rose Garden and makes these statements.

So as a consequence, I think people are lacking confidence even in banks. Now they’re trying to shore up the banks, putting money in the banks, money in insurance companies to make sure that we don’t have some kind of worldwide collapse.

The G-7 comes here; they’re looking at alternatives. You have the candidates out on the campaign trail offering things that try to appeal to this populist anger about giving money to the rich in the form of the bailout.

But so far, nobody has any — has been able to take a step that would engender the kind of confidence that would say to people yes, I’m going to invest in the stock market and get the market back up and stabilized.

MR. WALLACE: Brit, is there anything that you think governments or central banks could do that they have failed to do so far, or is this just a process of letting the markets find their natural bottom?

MR. HUME: I think the latter is correct, Chris. And I think that the governments have taken — this government in particular has taken very aggressive action and will be seen, in time, to have actually gotten out more ahead of this than it now appears.

What we now have is a panic in the stock markets, and you have this massive sell-off. There are obviously tremendous bargains in the market. There’s a lot of money on the sidelines, and when there is a sense — and it may come just from the day that all the people that wanted to get out are finally out of this market — the buying will continue and the market will begin to recover.

And I think there’s a very distinct possibility that we’ll come back, this economy and the other affected economies around the world, will come back more quickly than we now anticipate.

After all, when you flood banks and the system with the kind of liquidity that’s being pumped in by central banks all around the world, that will in time have an effect, and potentially a very powerful one.

Then, of course, we’ll be back to the days where we’re worried about inflation again. Right now we’re worried about the possibility of the kind of collapse that could lead to deflation.

MR. WALLACE: Well, and let’s talk about another problem. You’ve got the financial crisis on one side, and then there’s the underlying question of the possibility of a recession.

There seems, Mara, to be more and more acceptance of the fact that we’re either in one or headed into one that’s going to longer and deeper —

MS. LIASSON: Right. That’s what everybody says. Now, until we come out with the two quarters of negative growth to make it official, we won’t be in one. But everybody says we’re either in one or we’re going to be in one, and it might be severe and it’s going to take a long time to work out. That’s going to be the real problem.

And don’t forget, right now there is the stock market, which is this kind of mob psychology of panic, everybody getting out. But the real problem that this bailout was supposed to address was the credit clog, or — credit freeze. And once that starts getting unclogged and people start lending to each other and they can meet payrolls and make plans, that should free up things.

But yes, I think that whoever’s going to be the next president is going to probably inherit a recession that might be a little bit longer than the ones we’ve been used to recently.

MR. KRISTOL: Yeah. Look, the housing bubble was going to burst and there was going to be a recession at some point. There is every six or seven years. The problem is the credit markets.

And look, hindsight’s perfect, but I’ve got to say that Secretary Paulson announced his plan — when he announced his plan, the TED spread — that is, the credit crunch measurement, basically, or the LIBOR spread, was lower than it is now and the stock market, of course, was 3000 points higher.

I think it was — at the time —

MR. WALLACE: The difference between what the government is charging for money and what banks will charge.

MR. KRISTOL: What banks will charge. They have done — they have not reassured — and there are direct — now they’re going to do this. Now they’re going to go and do what they rejected three weeks ago, which is directly put capital into banks. They’re probably going to guarantee short-term lines for credit and letters of credit. That’s what they need to do to prevent the system from freezing up.

A lot of economists I talked to at the time of the Paulson plan were skeptical about it because it was such an indirect way of dealing with it. It was a long-term solution of taking these loans off the banks’ books and didn’t address the short-term issue of the short-term credit freezing up.

Anyway, hindsight’s 20-20, but I don’t really — I think there’s probably — I don’t know. It strikes me that they did not do a very good job of handling this, and we’re not out of the woods yet.

MR. WILLIAMS: You know, though, one of the problems is that the mortgage assets — we don’t know if they’re good or bad, and we don’t know who’s holding bad assets at this time.

So if you’re trying to make an investment, if you’re trying to make a judgment, you can’t make a judgment because you don’t know if people have been honest about what they put on the books. So therefore, people are reluctant to make loans, and that’s why you get into this guarantee thing.

But to my mind, it goes back. If we can solve the American mortgage issue, you can do a lot with the global issue, because then I think it would reassure people. And the populist anger right now —

MR. WALLACE: I want to go to a bigger issue.

There were some articles this week, Brit, and I’m curious to get your reaction to this, that suggested that capitalism as we’ve known it for the last half-century or century is dead; that we’re going to see a new hybrid of free markets, but also of much more government intervention and government ownership.

Do you believe that? Are we headed for that kind of transformation?

MR. HUME: I think it’s possible that there could be, worldwide, the imposition of a level of regulation we haven’t seen. And wait till you see how well private enterprise does trying to make money in that kind of an economy and see how long that regime lasts. I’m very skeptical of that, A, occurring, but if it does, B, lasting.

MS. LIASSON: Look, there’s always been a kind of swinging of the pendulum between government intervention or regulation or even ownership now, which is what we’re going to see in the banks, of the economy, and completely unbridled free-market capitalism.

I think it’s going to shift back a little bit. Capitalism is not dead. We live in a capitalist society. Now, we might end up with the federal government, for a period of time, owning a big chunk of a lot of banks. And also, not just putting new regulations on the book — and I think that’s what’s going to be the most controversial.

The question is a lot of these entities had a lot of discretion. The SEC had a lot of discretion and they chose not to use it. There’s going to be more oversight, more transparency, and probably more regulation.

MR. WALLACE: But Bill, when I — let’s just talk about it. Lehman Brothers. Houses, investment houses that existed for a century, gone. General Motors stock this week was trading at $4 a share. That is the lowest price since 1950. General Motors either is or was in talks with Chrysler about making the Big Three into the Big Two.

We’re talking about a pretty dramatic shift in the landscape of this country, the economic landscape.

MR. KRISTOL: I don’t think — look, auto companies go out of business. A lot of them have, in our history. Financial institutions are different.

It has never been the thought of any serious person who believed in free markets and democratic capitalism that you don’t need a strong government regulation of the banking system, of the currency, of the fundamentals of the financial institutions.

Alexander Hamilton is the father of democratic capitalism in America, and he was a strong proponent of the bank of the United States and of making sure that the financial system worked.

So you can have strong regulations for the financial system and have a flourishing free market.

MR. WILLIAMS: Well, the problem is, of course, that there was — greed took over. And I think that what we’ve seen under these Republican administrations, especially the last eight years, is let it go. Let it run. And that’s why people are frustrated, and that’s why there have been headlines like let — we’re all socialists now.

We’ve got to control some of these markets, and we shouldn’t be embarrassed about it.

MR. WALLACE: I like what Brit had to say. There may be buying opportunities just around the corner. (Laughs.) That’s where we’re ending this discussion.

Thank you, panel. See you next week.

Time now for some mail. And you had a lot to say about what should and shouldn’t be fair game for the presidential candidates.

Sandra Leonard from Georgia writes, “I for one am glad to see that Obama’s relationships with Bill Ayers and others are being pointed out again to the public. I hope his character will be called into question by many, since Bill Ayers is an American terrorist. I think who someone associates with says a lot about that person.”

But Rich Doell from Florida offers the Obama campaign some advice about dealing with such attacks: “We all know that McCain or his surrogates will gutter-ize their attack on Obama in the weeks to come. It will get ugly, simply because McCain’s losing. Obama should maintain the cool that he’s set, not go toe-to-toe.”

Be sure to let us know your thoughts by e-mailing us at fns@foxnews.com.

Up next, we go on the trail.


MR. WALLACE: As we said at the top of the hour, this was one of the roughest weeks so far in this campaign. The president candidates punched and counter-punched all week about the financial crisis, and each other’s character. And it all played out on the trail.

SEN. MCCAIN: (From videotape.) We’ve all heard what he said, but it’s less clear what he has done or what he will do.

SEN. OBAMA: (From videotape.) Senator McCain’s campaign announced last week that they plan to turn the page on the discussion about our economy and spend the final weeks of this election attacking me instead. (Boos from crowd.)

SEN. MCCAIN: (From videotape.) Rather than to answer his critics, Senator Obama will try to distract you from noticing that he never answers the serious and legitimate questions he’s been asked. (Cheers from crowd.)

SEN. OBAMA: (From videotape.) They can run misleading ads. They can pursue the politics of anything-goes, but it’s not going to work. (Cheers from crowd.) Not this time.

CINDY MCCAIN: (From videotape.) The day that Senator Obama decided to cast a vote to not fund my son when he was serving — (boos from crowd) — sent a cold chill through my body. (Crowd chants “No- bama!”)

SEN. OBAMA: (From videotape.) We need steady leadership in the White House. (Cheers from crowd.) We need a president we can trust in times of crisis —

SEN. MCCAIN: (From videotape.) I don’t need lessons about telling the truth to American people — (cheers, applause) — and were I ever to need any improvement in that regard, I probably wouldn’t seek advice from a Chicago politician.

SEN. OBAMA: (From videotape.) I can take four more weeks of John McCain’s attacks, but I know this — America can’t take four more years of John McCain’s policies, George Bush’s policies. We can’t take that. (Cheers, applause.)

MR. WALLACE: And the beat goes on. Twenty-three days and counting.

And that’s it for today. Have a great week and we’ll see you next “FOX News Sunday.”

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