updated 7/9/2008 11:31:55 AM ET 2008-07-09T15:31:55

Guest: Michael Smerconish, Richard Wolffe, Harold Ford, Jr., Tony Blankley

DAVID GREGORY, HOST:  Tonight, new on THE RACE, the panel face off.  Who has it right on the economy?  You‘ve heard the speeches, so what are the facts?  And is there an issue more important as the RACE FOR THE WHITE HOUSE rolls on?

Welcome to THE RACE.  I‘m David Gregory.  Happy to have you here, your stop for the fast-paced, the bottom line and every point of view in the room.  The point of this program, information to help you make up your mind and to help you make you smarter in your own political debates.

Tonight, the Face-Off over the economy.  Whose approach will actually bring relief to average Americans? And the ad wars tonight.  Both raise a central argument in the campaigns of Obama and McCain.  “Three Questions,” the sailing edition tonight.  Who‘s tacking where and why in the general, and will it work? 

The bedrock of the program, as you know, a panel that always comes to play.  And with us tonight, Michael Smerconish, radio talk show host on WPHT in Philly and columnist for both “The Philadelphia Inquirer” and “The Philadelphia Daily News”; Harold Ford, Jr., chairman of the Democratic Leadership Council and NBC News analyst; Tony Blankley, syndicated columnist; and Richard Wolffe, “Newsweek” senior White House correspondent, and he now covers Obama full time.  Richard is an MSNBC political analyst as well. 

We begin as we do every night, with everyone‘ take on the most important political story of the day.  It‘s “The Headline.”  I‘ll get us started here tonight. 

My headline, “The Mess Inside Team McCain.”

Our political team reports tonight the GOP strategist and former McCain adviser Mike Murphy will not—will not join the campaign after days of speculation that he would.  My reporting today reveals this: that Steve Schmidt, the former Bush adviser during the ‘04 race, and now the guy tapped to run the day-to-day inside McCain‘s campaign, has made it known internally that they can make one more change, and then enough.  Time to get back to campaigning and some message discipline.

Now that Murphy is not coming on board, at least not now, then perhaps another move is not in the offing.  The thinking now inside the McCain camp, get past the navel-gazing stories by turning up the heat on Barack Obama by arguing that he‘s not a guy that voters can trust to keep his word or to be a different politician. 

So here‘s a challenge for Senator McCain.  This is not the 2000 race, when he was running against the Republican establishment lead by George Bush.  It‘s not enough to say McCain should just be McCain.  He has to court the right, Bush‘s base, on not alienating Independents who are already moving away from the GOP.

Furthermore, it‘s tough to be the maverick when you‘re also the standard bearer of the party.  Perhaps that is why team McCain is struggling, at least for the moment.

Richard Wolffe, you‘re up.  Headline time out of the Obama speech today on immigration reform. 

RICHARD WOLFFE, MSNBC POLITICAL ANALYST:  David, my headline today, “Obama‘s Southwestern Strategy.”  We all remember how tight those Southwestern States were in 2004, 2006, a big decline in the Latino vote for Republicans.  Now Obama thinks it‘s all within reach. 

Take a listen to what he had to say about Bush and McCain to Latino voters today. 

(BEGIN VIDEO CLIP)

SEN. BARACK OBAMA (D-IL), PRESIDENTIAL CANDIDATE:  I want to give Senator McCain credit because he used to buck his party on immigration.  He fought for comprehensive immigration reform.  One of the bills that I co-sponsored, he was the lead. 

I admired him for it.  But when he started running for his party‘s nomination, he abandoned his courageous stance and said that he wouldn‘t even support his own legislation if it came up for a vote. 

(END VIDEO CLIP)

WOLFFE:  Now, David, we can talk about the definition of a flip-flop and whether Obama‘s been tacking to the center here, but nothing says flip-flop quite as much as McCain saying he would vote against his own bill.  That‘s Obama‘s pitch to Latinos. 

GREGORY:  All right.  Smerconish, you‘re also looking at that speech today and seeing a different stance from McCain.  It‘s security first.  He‘s reaching out to the base.

MICHAEL SMERCONISH, RADIO TALK SHOW HOST:  I am, David.  (SPEAKING IN SPANISH), which means, I think, “Secure the Border.”

John McCain also spoke to that Latino group today.  He waited until the end of his remarks to address the controversial subject of illegal immigration.  He offered few words, but his words were significant.  He said we need to secure the border first. 

Let‘s give a listen. 

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN (R-AZ), PRESIDENTIAL CANDIDATE:  We must prove to them that we can and will secure our borders first while respecting the dignity and rights of citizens and legal residents of the United States of America.  But we must not make the mistake of thinking that our responsibility to meet this challenge will end with that accomplishment. 

We have economic and humanitarian responsibilities as well.  And they require no less dedication from us in meeting them. 

(END VIDEO CLIP)

SMERCONISH:  David, as I think you were hinting, the intended audience for that portion of his remarks, I don‘t think it was the LULAC gathering, I think it were folks who were conservatives and in his own party. 

GREGORY:  Right.  I mean, the question is, how does he really move back to where he was on immigration when he‘s got to keep the base in line on an issue that was so big during the primaries?  Maybe it says (ph) a little bit now, but it could certainly come back with a vengeance. 

All right.  More on that ahead.  Tony Blankley, you‘re looking at the Iraq story today.  Another one today, the Iraqis are talking about a deadline for troop withdrawal.  Your headline? 

TONY BLANKLEY, SYNDICATED COLUMNIST:  Well, my headline is that “Obama‘s Iraq Adviser is Backpedaling Further.”  Although speaking for himself, he may be a leading indicator of where Obama is moving. 

I think the story today coming out of Iraq has to be seen in the context of Iraqi politics, where there‘s an upcoming election.  And so Maliki is playing, to some extent, to his own voters. 

He hasn‘t yet called for us to actually leave as official government policy.  And there‘s a long history, by the way, of countries who are privately glad to have American troops there who publicly oppose it. 

But this announcer today, reported on the front page of “The Washington Times,”  Colin Kahl, who is the chief Iraqi adviser to Obama, has said that, “Rather than unilaterally and unconditionally withdrawing from Iraq, the United States must embrace a policy of conditional engagement.”

He‘s otherwise talked about 80,000 troops on an indefinite period.  This is a further suggestion that I think Obama may be in the process of shifting his policy close to the McCain view on Iraq. 

GREGORY:  Harold, you‘re also thinking about Iraq tonight, I know, and the fact that this Maliki announcement, what‘s coming out of his campaign, does play into Obama‘s hands.  Why? 

HAROLD FORD, JR., NBC NEWS ANALYST:  Well, I think Maliki—out of respect for Tony, Maliki is ready for an Obama presidency.  It is clear from his top advisers, who made clear today, his national security adviser, who said very clearly, “We would not accept any memorandum of understanding with the United States‘ side that has no obvious and specific dates for the foreign troops‘ withdrawal from Iraq.”

I would agree.  There has to be a careful way of doing this.  But Barack Obama should be encouraged by this, and the country should, for two reasons.

One, there is internal politics in Iraq that is influencing a lot of this talk.  But two, the Iraqis recognize that the American military footprint will change. 

It will reduce or find itself downsized under Barack Obama for two reasons.  Tough love is what‘s needed in Iraq today.  And two, we have to redefine that mission.  Barack should be encouraged by the Iraqi government‘s stance. 

GREGORY:  Well, sure he should be encouraged, Harold, because this would make it easier for him to come out and say we do need a process of disengagement, get those troops out of there on some kind of timetable, because ultimately, if we‘re going to have a security agreement with the Iraqis, they‘re going to make a decision about whether they want troops there. 

FORD:  It makes it harder also, David, for McCain and for Republicans to suggest that Barack Obama‘s weak on security.  If the Iraqis are asking for a different kind of footprint—footprint form the Americans and a different kind of security structure, the Americans have to be willing, and this next administration has to be willing, to entertain and offer a different course for the Iraqis. 

GREGORY:  All right.  I‘m going to take a break here.  A lot more coming. 

Coming next, our new segment on THE RACE, the Face-Off.  Tonight, Blankley and Ford face off on the economy.  Who‘s got the right plan to help you through this economy?

Later on, it‘s your play date with the panel.  Call us, 212-790-2299, send us an e-mail, race08@msnbc.com. 

RACE FOR THE WHITE HOUSE will be right back.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

MCCAIN:  If you believe you should pay more taxes, I‘m the wrong candidate for you.  Senator Obama is your man. 

(END VIDEO CLIP)

(BEGIN VIDEO CLIP)

OBAMA:  And if Senator McCain wants to debate about taxes in this campaign, that‘s a debate I cannot wait to have. 

(END VIDEO CLIP)

GREGORY:  Welcome back as THE RACE rolls on.

McCain and Obama duel it out over the economy, serving up strong arguments today for why their plan will turn a lagging economy around.

Tonight, two of our all-star players from the panel face off, making the case for the candidate they think will bring relief to the average American.

You just heard the knocks and the swipes before we kick off the actual debate.  Take a listen to their plans. 

(BEGIN VIDEO CLIP)

OBAMA:  I‘ve proposed plans to create millions of new jobs, investing in American infrastructure to get energy costs under control by making America energy-independent, to make health care affordable for families and businesses, to put a college degree in the reach for anyone who wants to so that Americans can have the skills to compete in our global economy.  That‘s how we‘re going to solve the long-term problems. 

(END VIDEO CLIP)

(BEGIN VIDEO CLIP)

MCCAIN:  I have a plan to grow the economy, create more and better jobs, and get America moving again.  I have a plan to reform government, achieve energy security and ensure that health care and a quality education are affordable and available for every single American. 

(END VIDEO CLIP)

GREGORY:  All right.  Facing off tonight on the left, Harold Ford.  On the right, Tony Blankley. 

Harold, I‘ll start with you.  Make the case for Barack Obama, why this is the right plan on the economy. 

FORD:  President Obama‘s plan is basic: keep America competitive, create more jobs.  You do it by making investments in our infrastructure, finding alternative energy sources, reminding Americans that more than one-half of our trade deficit is attributable to the fact that we import more than 70 percent of our energy. 

To invest in infrastructure in this country will create jobs, and the real thing—the real test for small business in America, the way you help alleviate some of the burden on them, is to develop a health care plan that allows them to not only help their workers afford health care, but to relieve them of that burden and allow them to create more jobs, invest more in their business, and keep America humming. 

If you want $20 million jobs like we created in the ‘90s, you can‘t go back to the same old ways.  You have to try new ways.  Barack‘s way is the right way. 

GREGORY:  All right, Tony, respond.  Make that case for McCain‘s approach. 

BLANKLEY:  Yes, look, I think there‘s a lot of phoniness on both sides in talking about these numbers.  On the one hand, McCain is not going to balance the budget, nobody is going to balance the budget. 

Harold knows the numbers better than I do, what‘s going to happen with Social Security as it goes into deficit in the next five or seven years.  They‘ll both be lucky to keep it under a half a trillion by the end of the first term. 

But the awesome basic differences between the two candidates and their economic policies, one is whether you‘re going to drill for oil or not?  That is McCain‘s proposal, to increase the supply, along with trying to be more efficient.  While Obama is arguing for no increase in supply, only to conserve and to bring on—which won‘t happen in his term—alternative energy sources. 

The second difference is that while Obama is going to spend more money, he‘s also going to tax more.  And while he says he‘s going to tax only the rich, the fact is that there isn‘t enough money for the rich people.  Inevitably, tax cuts to make real revenues have to reach down to the $100,000, $150,000 family incomes.  That‘s the middle class, and that‘s what‘s going to happen. 

(CROSSTALK)

FORD:  I‘ve got great respect for Tony, but the only problem is we heard this no new tax.  We heard this, extend all of these tax cuts. 

And I‘m a believer in tax cuts.  And Barack is probably going to have to make some revisions on some of these places where he cuts taxes. 

But the reality is this: during the ‘90s, there were many people who complained about the Clinton approach to the economy.  He created 22 million jobs.  This President Bush, with all of his tax cuts and all of his bragging about his way of doing things will end his term creating barely five million jobs. 

America wants a change.  Invest in infrastructure, energy.  Cut taxes on middle class people and develop a real health care plan for small business.  I do agree with Tony on one other thing.  If we don‘t address this entitlement problem, you will never balance the budget in Washington. 

BLANKLEY:  Let me point out—let me argue that I would be satisfied with a Clintonian economic policy coming out of Obama.  I don‘t think that‘s where he‘s going.

Clinton never created—he tried to create a big health care proposal and then failed.  He never tried to expand social spending, where, in fact, Barack Obama is promising increased spending across the spending across the board in education, health care.  It may be needed, we could argue the policies of that, but they‘re going to cost hundreds of billions of dollars and they‘re going to come out of tax increases that are not going to be good for the economy. 

GREGORY:  Let me get in here with this question.  The biggest factor right now in this economy, even if it‘s not by definition a recession, the housing crisis is real.  And even people in the housing sector don‘t know where it ends. 

FORD:  There will be a big test...

GREGORY:  What do these two candidates...

FORD:  There‘ll be a big test in the Senate and the Congress in the next week or so when there‘s a vote held on the Dodd, Shelby and Frank bill that will come out that provides a $300 billion backstop through a super v3ehicle created through the Federal Housing Administration.  There will be relief given to cities and local governments as well. 

Barack Obama and John McCain will have a chance to vote yet.  It‘s not the end all, be answer, but it‘s a part of a bigger solution. 

The real answer, though, as you look long term, you‘ve got to create better jobs.  Who‘s plan will create better jobs is the question that Americans have to ask themselves.  Do you invest in the future, or do you continue drilling for a commodity that even T. Boone Pickens says, one of the great oilmen of his era, says we can‘t drill our way out of this challenge? 

BLANKLEY:  Keep in mind...

GREGORY:  All right.  Let me bring in Smerc and Richard here. Richard, you first.  Based on your own reporting looking at these plans side by side, where are the facts here, where are the challenges for each of these candidates here as they lay these strategies out? 

WOLFFE:  Well, I think the big thing to look at is their approach on tax cuts, and specifically Bush‘s tax cuts.  There‘s a big contrast there. 

But I‘m reminded, you know, in 2000, Al Gore and George Bush debated how to spend a $3 trillion surplus.  You know, these debates, when they get into the specifics, they are not worth the paper they are written on by the time these people enter office. 

GREGORY:  Yes, that‘s the other thing, Smerc.  Nobody is talking about the fact that you‘ve got to deal with Congress to get spending cuts through.  How big are those spending cuts going to be? 

You know, John McCain wants to end earmarks.  They are not a huge percentage of the budget anyway.  Nobody is dealing with the political realities of dealing with a branch of Congress. 

SMERCONISH:  I think to your point, we give presidents far too much credit when the economy is doing well and probably far too much blame when things are going poorly. 

In the big picture, David, what occurs to me is there are some quirks in the platforms of these candidates.  Barack Obama, the Democrat, talks tough on Pakistan.  John McCain, the Republican, embraces climate change.  But on these economic issues, which I think were very well articulated by your two guests, they are very traditional views. 

The Democrat has a more liberal approach to the economy and the Republican has a far more conservative approach.  It‘s a traditional battle.

GREGORY:  All right.  We‘re going to take a break here. 

Coming up next, our nightly veepstakes.  Tonight, should McCain be considering a top surrogate on the trail who could help him with the economic argument?

And Terry McAuliffe‘s prediction for Obama—after this. 

(COMMERCIAL BREAK)

GREGORY:  We are back on THE RACE and holding our own mini version of veepstakes, which each day we vet a possible vice presidential candidate, or two. 

Here again, Michael Smerconish, Harold Ford, Jr., Tony Blankley and Richard Wolffe.

First up, veepstakes news.  Terry McAuliffe, of course campaign manager for Hillary Clinton, placing his bet that Obama‘s VP will be Joe Biden.

McAuliffe, who chaired Hillary Clinton‘s presidential campaign, predicted Obama will chose Senator Biden because of his international experience.  “The Chicago Sun-Times” reports McAuliffe made the comments last night in Colorado, where he was dining with former President Bill Clinton, who is attending the Aspen Ideas Festival. 

Turning now to John McCain and a potential V.P. pick that could help him win over some former Hillary Clinton supporters, Carly Fiorina.  She‘s 53 years old, a former CEO of Hewlett-Packard, although her first professional job was as a receptionist. 

She‘s been out in front as McCain‘s senior economic adviser.  She‘s been an important surrogate for McCain as he reaches out to female voters.  She also heads the RNC‘s Victory Committee.  However, The Washington Post‘s Dana Milbank reports that her controversial exit from HP and her relative inexperience in politics could make her a risky running mate for McCain. 

Tony, too risky? 

BLANKLEY:  My preference—I think she‘s a very impressive and accomplished person.  My preference is always for an experienced politician.  People underestimate the skills.  It may be a dark and ugly profession, but it‘s a profession that has skills. 

And you‘re an amateur—you may be a professional in business or sports or something else, you‘re an amateur when you get into politics.  And the fast track is no place for an amateur. 

GREGORY:  And here‘s the other thing, Richard.  Look, the grim reality is the president, who‘s going to be the age of John McCain, I think 72 when he‘s inaugurated if he‘s president, you‘ve got to think of a VP as a successor.  Should you die in office, that‘s going to be a reality on voters‘ minds. 

WOLFFE:  Right.  And looking at the base there, they are going to ask a couple of questions about Carly Fiorina. 

GREGORY:  Right.

WOLFFE:  Notably, about abortion and birth control.  She doesn‘t seem to know what her candidate‘s position is. 

She said to “Newsweek” magazine, no less, that the candidate did not sign on to efforts to overturn Roe v. Wade.  Well, it says on McCain‘s Web site that he wants to overturn Roe v. Wade.

And she also said recently that there should be insurance coverage for birth control, something also McCain has voted against.  So I think he‘s going to have a problem with the base if he chooses Fiorina. 

GREGORY:  And real quick, Harold, do you like Biden for Obama? 

FORD:  We could do a whole lot worse.  He understands foreign policy, he has grounding in Washington.

I agree with my friend Tony, you want someone as a VP who understands the machinations and the workings of D.C.  Joe Biden would be a great choice if he makes that list. 

GREGORY:  Yes.  All right.  We‘ve got to take a break here.  Coming up next, the ad wars, why the new ads in the battlegrounds make a crucial argument for both sides. 

This RACE FOR THE WHITE HOUSE.  Stick with us for the back half.  It‘s coming up next.

(COMMERCIAL BREAK)

(NEWS BREAK)

GREGORY:  Back now on THE RACE.  I‘m David Gregory.  Happy to have you here for the back half.  We‘re going to go inside the war room now and talk tactics, what‘s working, what isn‘t.  Back with us, Michael Smerconish, radio talk show host on WPHT in Philly and columnist for both the “Philadelphia Inquirer” and the “Philadelphia Daily News,” Harold Ford Jr., chairman of the Democratic Leadership Council and NBC News analyst, Tony Blankley, syndicated columnist here, Richard Wolffe, “Newsweek‘s” senior White House correspondent, who covers team Obama at the moment, also an MSNBC political analyst.

First up, new ad from McCain featured his P.O.W. experience.  Here it is. 

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE:  It was a time of uncertainty, hope and change, the summer of love.  Half a world away, another kind of love, of country.  John McCain shot down, bayoneted, tortured, offered early release, he said no.  He had sworn an oath.  Home, he turned to public service.  His philosophy, before party, polls and self, America.  A maverick, John McCain tackled campaign reform, military reform, spending reform.  He took on presidents, partisans and popular opinion.  He believes our world is dangerous, our economy in shambles.  John McCain doesn‘t always tell us what we hope to hear.  Beautiful words can not make our lives better, but a man who has always put his country and her people before self, before politics can.  Don‘t hope for a better life, vote for one.  McCain.

MCCAIN:  I‘m John McCain and I approve this message. 

(END VIDEO CLIP)

GREGORY:  Smerc, it‘s a strong ad there.  I think it‘s the central argument for why McCain wants to be president.  It‘s all in there, taking on Obama.  Break it down. 

SMERCONISH:  I think there are no wasted words when you‘re playing at this level.  I took note, David, right off the bat, the summer of love.  When was the last time you heard that expression?  What they‘re saying here is, without saying it, Barack Obama is the George McGovern of the new millennium.  I also think this is the McCain campaign not taking for granted that Americans know the background story of John McCain and feel the need to reintroduce him to the American populous. 

GREGORY:  However, Richard, you and I were talking earlier.  You think this idea, this last line, don‘t hope for a better life, vote for one.  Of course we‘re supposed to hope for a better life. 

WOLFFE:  Right, I don‘t doubt this is a handsome ad.  It‘s a powerful ad.  There‘s compelling stuff about McCain‘s life story.  But that tee up line, don‘t hope for a better life?  I‘m sorry.  What he‘s saying is voting is better than hoping for a better life.  That‘s not exactly an optimistic message. 

GREGORY:  Let‘s move on here.  The first response ad from Obama, hitting McCain on the issue of energy.  It also contains a central argument in his campaign.  Watch this. 

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE:  On gas prices, John McCain‘s part of the problem;

McCain and Bush support a drilling plan that won‘t produce a drop of oil for seven years.  McCain will give more tax breaks to big oil.  He‘s voted with Bush 95 percent of the time. 

Barack Obama will make energy independence an urgent priority, raise mileage standards, fast track technology for alternative fuels, 1,000 dollar tax cut to help families as we break the grip of foreign oil.  A real plan and new energy. 

OBAMA:  I‘m Barack Obama and I approve the message. 

(END VIDEO CLIP)

GREGORY:  Tony, forget the substance there.  Forget what the ad is saying.  You have the kiss in there.  You have the hug with Bush.  That‘s the point of that ad. 

BLANKLEY:  You know, I think this ad is so fraudulent.  I give a lot of leeway to politicians and their ads.  But the idea that he accuses McCain and Bush of having an energy policy that didn‘t yield any energy, when it was the Democrats all through the years that blocked the drilling, and the fact that Obama is calling for no drilling for no new energy from oil and natural gas.  I think it‘s such a fraudulent ad that it cries out to be critiqued in the narrative of the news.  I think, if I were McCain, I would come back after him.  I think this is a strong area for McCain and Obama‘s playing into that strength dangerously. 

GREGORY:  But, nevertheless, Harold, it‘s legitimate debate to have whether exploration domestically is really the ticket when it comes to weaning ourselves off foreign oil.  McCain is making that case, as did George Bush.  Tony is right.  It was blocked by Congress at the time.  It was a sharp ideological divide.  But this is a legitimate debate to have. 

FORD:  I would remind all Americans and everyone listening, that my tired time in the Congress, 10 years, Republicans controlled it all.  For six of those years, President Bush enjoyed majorities from both Republicans in the House and for some of the years in the Senate.  They had an opportunity to pass and couldn‘t pass it.  T. Boone Pickens, the great oil tycoon of our era, who indicates he drilled for oil all of his life, now readily agrees that we can‘t drill our way out of this challenge. 

John McCain‘s been in the Senate for 26 years.  What screams from that ad is it‘s the old versus the future.  Do you want politicians who tell you promises, make promises over and over again about how they‘re going to change things, or do you really want a break from the past?  That‘s what Barack represents.  I think McCain‘s ad is a compelling.  There‘s going to have to be a sound and compelling response, with Barack Obama‘s own life story being the centerpiece of his response. 

GREGORY:  That‘s it.  People say it‘s reinforcing the generation split.  This is McCain‘s deal.  His life is a huge part of why people will ultimately vote for him.  Whether that reminds people of the ‘60s or not, there‘s nothing he can do about that. 

Next up, voter registration spikes in key battleground states.  Political guru John Ralston of the Ralston Report has numbers out of Nevada.  Look at this, the Democrats now have a 55,560 voter lead over the Republican in a state—We‘re talking about Nevada here—that was dead even a presidential cycle ago in ‘04.  But the numbers in Congressional district three could be the most worrisome to the GOP, as Democrats now have a nearly 24,000 voter lead in a district that was even only two years ago.  Big deal, Richard, right? 

WOLFFE:  Huge deal.  This is why people have looked at these southwestern states and predicted this kind of realignment.  This year, we can see it.  With Bush‘s rating in 2004 among Latinos at 40 percent, then in 2006 going down to 30 percent; these shifts are real.  This is the results of the extended primaries or the energy among Democrats.  What we saw in Nevada, which was a very hotly contested caucus.  This is the result. 

GREGORY:  Yes.  Tony, if you‘re looking at this on the Republican side, you have that energy problem right now.  The enthusiasm problem on the right; this is what they went to work on in ‘04 in the Bush team, in terms of creating new Republicans in the exurbs.  That was the big story line.  Are they matching that enthusiasm now? 

BLANKLEY:  No, they are not.  It‘s a big problem.  Whether it‘s Colorado or New Mexico or Arizona, which is probably safe because it‘s McCain‘s home state, or Nevada, these are all states where they are trending from being Republican to very competitive.  Nevada, you have the double factor.  You have tremendous in migration of voters who are not traditional Nevada Republicans.  Then you‘ve got the excellent energized Democratic electorate.  They combine to make Nevada a very dangerous state for McCain in the fall. 

GREGORY:  Finally here in the war room, the state of the union.  We‘re talking about the merger between Obama and Clinton as it continues, with camp Obama hiring Hillary Clinton‘s former director of women‘s outreach, who says that Obama will, in fact, make life better for women.  But the merger is still under negotiation here, with the camp sorting out Clinton‘s convention role, with a debate brewing whether to include her in a roll call vote.  Here‘s what the “Wall Street Journal” is reporting, quote, “a full roll call vote that reminds everyone how close she came to being the nominee could reveal party rifts going into the fall campaign.  But keeping her name off the role call could anger her supporters.” 

Smerc, how do you see it? 

SMERCONISH:  I think it‘s a potential real short fall for the D‘s.  You can‘t have that television moment, although it‘s one of the high points of the convention, where spokespeople for each of the states weigh in by offering their support for a particular candidate.  If, in the end, it‘s going to be a razor thin margin between Senators Clinton and Obama, and we know the outcome of that.  Can‘t have it. 

GREGORY:  Richard, what is your reporting telling you about how the merger, how this union is actually coming together? 

WOLFFE:  It‘s going pretty well, actually.  The resentment, the bitterness is always going to be there for a core of Hillary supporters, especially some people who were very close to her.  But I think, among the staff people, among the fund-raisers, they are coming together very quickly.  I think this may be the story that didn‘t bark. 

BLANKLEY:  One quick point.  My recollection is the broadcast networks did not cover the roll call votes in the recent past.  This may be an event that‘s only seen by five or ten million people, not by 50 or 70. 

GREGORY:  We‘re going to take a break here, come back and ask three questions.  When do general election adjustments become broken promises?  You‘re hearing a lot about that on the campaign trail.  We‘ll get into it when we come back on THE RACE.

(COMMERCIAL BREAK)

GREGORY:  We are back on THE RACE.  Fighting the flip-flopping floating far right, and in what voting pools should the anchor be dropped.  Summer vacation talk?  No, these are today‘s three biggest questions in the ‘08 race.  Still with us Michael Smerconish, Harold Ford Jr., Tony Blankley and Richard Wolffe.

First up, Obama fights the accusation that he‘s a flip-flopper.  At a town hall in Georgia today, Obama hit back at claims that he has changed his position on key issues like domestic surveillance, gun control and withdrawing troops from Iraq. 

(BEGIN VIDEO CLIP)

OBAMA:  This notion I‘m shifting to the center or that I am flip-flopping, this or that or the other; the people who say this, apparently, haven‘t been listening to me.  I have to say, some of them are my friends on the left and in some of the media.  I am somebody who is no doubt progressive.  Don‘t assume that if I don‘t agree with you on something that it must be because I‘m doing that political.  I may just disagree with you. 

(END VIDEO CLIP)

GREGORY:  “New York Times” columnist Bob Herbert writes today that Obama has come a long way from where he stood during the Iowa caucuses.  To the quote board, “tacking toward the center in a general election is as common as kissing babies in a campaign.  But Senator Obama is not just tacking gently towards the center, he is lurching right when it suits him.  He is zigging with the kind of reckless abandon that‘s guaranteed to cause, disillusion, pandering to evangelicals, agreeing with Justices Antonin Scalia and Clarence Thomas, and taking his base for granted.”

First question tonight, is Obama being too flip about flip-flopping? 

Harold, take it on. 

FORD:  He could probably be more artful in how he‘s doing it, but the reality is every campaign for the presidency, you find Republicans and Democrats who work their way back to the middle.  I know, I like and I respect Bob Herbert, and I can appreciate what he‘s saying.  I think what Senator Obama has to understand at this point is there‘s no need to be defensive about this.  There‘s no need to lean back.  Lean into this argument and offer a leadership plan for the country.  He did it brilliantly during the primaries.  He does it during the general, he‘ll be the next president of the United States. 

GREGORY:  All right.  Richard, I understand the arguments that he probably loves all this flak he‘s getting from the left at the time that it‘s a general election.  He‘s going for independent voters.  But why shouldn‘t he be tagged and tagged hard for at least refining some of these positions that, as some people have pointed out, if he stood this ground in the primaries, he wouldn‘t have gotten the nomination.  We‘d be looking at Hillary Clinton. 

WOLFFE:  I don‘t know that he‘s loving the flack from the left, actually.  He‘s definitely shifted on his position on FISA, on domestic surveillance.  He‘s been getting a lot of heat for that.  On Iraq, remember, he took a lot of heat in the primaries for his position on Iraq, because he wouldn‘t commit to a date certain for withdrawal.  Every time a debate moderator, an interviewer or candidates like Bill Richardson and Hillary Clinton tried to push him there, he always had those caveats. 

So I think there‘s a little bit of false memory syndrome about the kind of campaign he ran.  He was against the war for sure, very clear about that.  But on withdrawal, he always said it would be careful and nuanced. 

GREGORY:  Tony, that‘s true.  But let‘s remember, everybody on that stage at one of our debates, except for Bill Richardson, said they would not commit to a full withdrawal at the end of their first term.  They all started to hedge on that a bit. 

BLANKLEY:  They have.  The fact is, Obama is the nominee.  The others aren‘t.  The set of changes he‘s making are somewhat jarring to the public.  I think it‘s probably a smart move.  The voters who are going to decide in October aren‘t watching now.  He gets it out of the way.  He gets himself positioned properly.  There‘s about a 20 percent risk that he‘s being too clever and too fast by half, and that he may lose his special attraction as someone above politics.  The argument well, everybody does it is an argument he‘s not positioned to make. 

There‘s some risk, but it‘s probably a smart play. 

GREGORY:  Let‘s move on next to McCain.  He‘s walking a fine line on immigration.  In ‘05, McCain bucked his party, teaming up with Ted Kennedy to fight for comprehensive immigration reform.  Some people think that‘s amnesty.  That‘s debatable.  George Bush and others would debate it.  In January, McCain did a 180, telling GOP primary voters that he wouldn‘t vote for his own bill.  Today, he is speaking to the League of Latin American Citizens.  McCain acknowledge his efforts to create a guest worker program, but put the emphasis on security. 

(BEGIN VIDEO CLIP)

MCCAIN:  I and many other colleagues twice attempted to pass comprehensive immigration legislation to fix our broken borders.  Many Americans with good cause didn‘t believe us when we said we would secure our borders, so we failed in our efforts.  We must prove to them that we can and will secure our borders first, while respecting the dignity and rights of citizens and legal residents of the United States. 

(END VIDEO CLIP)

GREGORY:  Second question tonight, is McCain tacking far enough to win the right on this issue?  Smerc? 

SMERCONISH:  I think he‘s had a problem on the right relative to illegal immigration and the address that he made today, those two paragraphs were intended to keep those folks inside his tent.  The perception among conservatives is that the borders ought to be secured before there is comprehensive immigration reform. 

In the end, I believe that conservative base is John McCain‘s and is not in jeopardy.   

GREGORY:  Tony, this was a guy who stood up to people in his own state who said that he was for amnesty.  This was when he was campaigning for it in the Senate.  He said this is the right thing to do.  You can‘t take 12 million illegals and send them back to Mexico.  He stood his ground.  Then he‘s running for president and, as Barack Obama says—makes the argument, he abandoned that promise.  Is that a fair charge against him? 

BLANKLEY:  Yes, I think the handling of the immigration issue during the election cycle is a mess.  There‘s no way around it.  He had taken a very strong position.  He then tried to equivocate a little bit.  Now, he‘s caught where if he‘s appealing to the Hispanic vote, Obama can always force him to move further to the comprehensive position.  If he does that, he antagonized the base.  I think he ought to more or less stay put, hope that the base will hold its nose and vote for him.  But it‘s a mess regarding immigration and Obama and the Republican base. 

GREGORY:  Flip it around a little bit, Richard, which is that he has got some street cred, you could argue, with Hispanic voters.  He‘s from Arizona.  He‘s staked out this position.  Now, he‘s backtracked and wants a security first kind of bill.  Why isn‘t that enough to keep him competitive with Hispanic voters against Obama? 

WOLFFE:  Because the Republican brand is so poor in their standing.  I mean, you cannot run the kind of campaign that Republicans across the country have been running and expect that the leader of the party is going to be able to escape Scott-free.  Yes, his own position is important.  That‘s why when he‘s hedged on it, or said he wouldn‘t vote for comprehensive reform that he proposed, that‘s a problem. 

BLANKLEY:  Let me say though, I think he‘s in a position to get 35 to 40 percent of the Hispanic vote.  I don‘t think he‘s in a terrible position for a Republican. 

GREGORY:  Bush got 40 in ‘04. 

BLANKLEY:  He could get in that zone.  He‘s already around 30, with ten percent undecided.  He could easily move up another seven points. 

GREGORY:  All right, final question here tonight, both McCain and Obama walking the general election tight rope.  We‘re talking in this segment about the adjustments they‘re making, trying to appeal to independents while keeping the party faithful revved up and ready to get out and vote in November.  This is the third question, is this a base turn out election or a contest for the middle?  Let‘s ask the man from the DLC, Harold. 

FORD:  I think this is a race about gas prices, about jobs and about the war in Iraq.  I think this is a different kind of race.  I think the base is going to be excited on both sides.  I think anyone who thinks that McCain is not going to excite conservatives is probably dead wrong.  I think anyone who thinks Barack is not going to excite liberals, or those on the left in my party, they are wrong. 

The reality is these races, at the end of the day, are decided in the middle.  This race, above any—I‘m 38 years old.  I‘ve never seen a race where more people who are liberal or conservative, in the middle, wherever they sit politically, are concerned about two or three serious issues, energy and gas prices, the war and jobs.  They want a president who can lead. 

You have 20-20 on each side that, frankly, won‘t vote for the other side.  I think the majority of Americans, for the first time in a presidential race, are going to listen very closely to these candidate.  They‘re going to vote for the one whom they believe can best lead, can best deliver and who won‘t be inflexible and ideological in their approach to governing. 

SMERCONISH:  Can I get in on this? 

GREGORY:  Real quick. 

SMERCONISH:  It‘s going to be won in the middle.  As I see it, anecdotally, it‘s coming together as a referendum on Barack Obama.  And the base on either end of the extremes are motivated and coming out.  It‘s the middle that will determine this. 

GREGORY:  This is why the ground games matters so much.  What these campaigns are doing in the states, we heard about Nevada, creating new voters, registering new voters.  That‘s what Obama wants to do.  I don‘t know, Harold.  The one thing that McCain does have to deal with is that voter enthusiasm, particularly on the far.  They might just sit out. 

FORD:  That‘s why you‘re the host and the smartest guy on the show.  The fact that we have disadvantage in these states, I agree.  That‘s where that‘s what this will come down to; who‘s more exciting, who goes to the polls and who has the advantage.  The Democrats are doing what Rove did to Democrats in 2000 and 2004.  Barack‘s team has been able to achieve a lot of this in 2008, which is why you have to give them the advantage. 

GREGORY:  We‘re going to take a break here.  Coming back, our final moments, your play date with the panel.  We‘ve got some good emails and phone calls after this.

(COMMERCIAL BREAK)

GREGORY:  We‘re back on RACE FOR THE WHITE HOUSE.  Final moments here, your play date with the panel.  Back with us the panel tonight, Michael, Harold, Tony and Richard.  Barbara from Michigan writes this: “isn‘t the main difference between Obama and McCain‘s positions on Iraq the mission each will give to the military once he become commander in chief.  It seems like Obama‘s mission is to end the war and refocus on Afghanistan and McCain‘s is to win in Iraq.  I believe both will attempt to achieve those missions responsibly, but only one of them is in touch with what most Americans want.”

Which is what, Richard? 

WOLFFE:  If you look at the polls, people want the war to end.  The question is on what terms?  What do you call success?  There is a difference between those missions.  The e-mailer is absolutely right.  The missions these two different commanders in chief would set. 

GREGORY:  This becomes important when you look at the ultimate—I think both of these candidates as president would keep a long term commitment of US troops to Iraq.  I think beyond much doubt here.  Now, I think McCain would keep a higher number, perhaps.  But it‘s relevant when you talk about whatever‘s going to happen down the line in Afghanistan.  I read recently the president is talking about the real concern is going to Pakistan.  Afghanistan and Pakistan are going to be a major focus of the next administration. 

BLANKLEY:  Surely.  But I would caution whoever is elected president not to have too much confidence in saying I‘m doing what the American are asking me to do now.  The American people can change their mind.  You can ask George Bush about that.  You have to judge what‘s in the best interest of the country, will be seen so four years later.  Just relying on momentary polls doesn‘t mean much, which is why I suspect the two foreign policies will look fairly similar, both in Afghanistan and Pakistan, as well as in Iraq.  

GREGORY:  Hey, I want everybody to comment on this.  But an interesting story out of the “Times of London” about a bit of a flap going on in Germany.  We know that Barack Obama is going to travel to Europe.  He‘s going to give a speech in Berlin.  From the Time‘s piece, there‘s a simmering row between the German government and the local Berlin authorities, reportedly, that could rob the Democratic politician of a photogenic moment at the Brandenburg Gate and derail his flagship tour of Europe this month.  Richard, is this real? 

WOLFFE:  You know, these trips are fraught with difficulty.  It‘s exceptionally rare you get a presidential candidate who is willing to risk it.  The Obama folks, my sources say, do want to do an outdoor event.  they think the visuals would be great.  But listen, I‘m not sure how it plays back home.  Having Obama cheered on by groups of Germans, is that really going to buy them votes back home?  I don‘t think so. 

GREGORY:  Smerc, what do you radio listeners say on this topic?  Is that what they want to see?  Do they want to see a little bit of repair going on in the rest of the world between a potential president and that part of the world? 

SMERCONISH:  I think it‘s probably all about Senator Obama determining some foreign policy credibility and credentials.  You know, Berlin, the wall is gone, but it‘s still where east meets west.  It‘s where JFK spoke.  It‘s where Ronald Reagan said, Mr. Gorbachev, tear down this wall.  I think that‘s his aim, to be viewed in that context. 

GREGORY:  That‘s the thing, Harold, a trip like this following Afghanistan and Iraq.  They do want a place in Europe to say look how the world is reacting to Barack Obama, if they can get a favorable crowd out there. 

FORD:  There is no doubt, they are going to get favorable crowds wherever they go.  They should be careful to head the advice of Richard.  Americans in Pennsylvania and Ohio, Tennessee and West Virginia, as much as they want to see Germans excited about the president, they want Americans to be excited.  It should be a good trip.  I hope he spends enough time on the ground with the troops in Iraq and Afghanistan.

GREGORY:  We‘re going to leave it there.  Thanks to the panel.  We‘ll see you tomorrow night.  “HARDBALL” next. 

We‘re going to leave it there.  Thanks to the panel.  See you tomorrow night.

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

END   

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