Guests: John Harwood, Pat Buchanan, Lawrence O'Donnell, Tim Kaine, Mitt Romney, Jane Mayer
DAVID GREGORY, HOST: Tonight, attacks and counterattacks. Charges fly as Senator John McCain fights from behind in the polls. Nothing is off limits now, it seems, from Joe the plumber. The charges of socialism leveled against Senator Obama. Senator Joe Biden using the phrase "Gird your loins" to refer to what the next president will face in office. All that and more as the RACE FOR THE WHITE HOUSE rolls on. Crunch time now, 15 days to go in the race for the White House. Welcome to the program. I'm David Gregory. My headline tonight, "Tax and Defend." n a campaign of unusual twists and turns, Senator McCain and Governor Palin have seized on Joe the plumber's questions about Senator Obama's tax plan to launch an all-out campaign attack of their own over the weekend. Governor Palin claimed that Obama's plan had elements of socialism, while Senator McCain criticized what he called that redistribution of wealth.
(BEGIN VIDEO CLIP)
SEN. JOHN MCCAIN (R-AZ), PRESIDENTIAL CANDIDATE: It's clear to me, as it is to most Americans, that to "spread the wealth around" or increase capital gains taxes in the name of fairness, as Senator Obama wanted to do, is not the recipe to bring our economy out of the ditch.
(END VIDEO CLIP)
(BEGIN VIDEO CLIP)
SEN. BARACK OBAMA (D-IL), PRESIDENTIAL CANDIDATE: And John McCain thinks I'm praising socialism. And do you know why? This is his argument this is his argument-because I want to give a tax cut to the middle class.
(END VIDEO CLIP)
GREGORY: Meantime, Senator Obama picked up a very important nomination from Secretary of State formerly Colin Powell, who called Obama a transformational figure. Powell said he had grown tired of McCain's negative campaigning. Joining me now to talk about it all, John Harwood, CNBC Chief Washington correspondent and a political writer for "The New York Times,"; Pat Buchanan and Lawrence O'Donnell. Both are MSNBC political analysts.Welcome all. Let's put some of the new polling up on the screen. This is from CNN/Opinion Research poll: 51, Obama, to 46, McCain. This has tightened somewhat. It was eight points two weeks ago. We see that the Real Clear Average poll is also down a little bit as well, a slightly tighter margin. Pat Buchanan, this is McCain talking about this tax argument and Joe the plumber's impact on his campaign. Watch this. We'll talk about it all. Do we have that sound bite? OK. We don't have that sound bite. Pat, the issue here of the argument that has been made from McCain/Palin is about taxes, it's about socialism, it's about redistribution of wealth. The race is tightening. This is where they want to be.
PAT BUCHANAN, MSNBC POLITICAL ANALYST: I think it is. I mean, Barack Obama gave them an opening the other night with the "spread the wealth comment" to the plumber, Joe the plumber. And what McCain is basically saying is, what Obama's going to do, he's going to take money from the successful people in the country, the top five percent, and tax them, and give it to people, those people who don't even pay taxes. About one-third of all earners don't pay any federal income tax. And he's saying that is socialism. And I think fundamentally he's got a basic argument. And my guess is, David, it must be working, because they've been working this theme ever since the debate, what, on Thursday night, Friday, Saturday, Sunday, Monday. And my guess is they've moved away from Ayers and they think maybe they can gain ground with this. They've got a lot of ground to gain.
GREGORY: Lawrence, is there an argument here to be made when you had Senator Obama saying to Joe the plumber, now famously or infamously, hey, we've got to move this wealth around a little bit to benefit everybody? Did he do himself a disservice there?
LAWRENCE O'DONNELL, MSNBC POLITICAL ANALYST: Well, not in the full context of what he said. The full context of what he said made perfect sense. There has never been a tax-never been a tax in the history of this country that did not redistribute wealth. It is impossible to tax without doing that. Now, to hear Pat Buchanan saying the socialism argument is the way to go is interesting, because Pat himself is a card-carrying socialist. Reach into your pocket, Pat. Pull out your Medicare card. Promise us you'll never use it again. That you and your friend John McCain will never use that socialist government-run health care program again that you've been using for a number of years now. That was called socialism when it was first enacted because it is. The truth of it is that every country in the world uses socialism to varying degrees. We just used it in a big plunge into the banking system. All economies are mixed economies, some capitalism, some socialism. Ours is predominantly capitalism, but it has a lot of socialism.
GREGORY: All right.
Let me bring in John Harwood here.I want to explain what you're seeing on your screen right here. These are live pictures coming to you right now from Orlando, Florida, where you see Senator Hillary Clinton and Senator Obama at a campaign rally there together in Orlando, Florida. The first time they've been together, John Harwood, since they did that unity even in New Hampshire. And isn't it amazing that 15 days from Election Day, we've got these two together in Florida, a state that a lot of Democrats thought would be written off as the McCain pick-up and holdover from Bush's win in '04.
JOHN HARWOOD, CNBC CHIEF WASHINGTON CORRESPONDENT: No question about it. Remember that Bill Clinton carried the state of Florida. Hillary Clinton did very well with older voters in the primaries. That's a weakness for Barack Obama, so she can help him as early voting starts. And I've got to just add to what Lawrence said. Look, when you've been associating your opponent with terrorists, you have a certain name-calling inflation. So when they say socialism, they're simply attaching a label to something that's very commonplace in our politics. John McCain is for a refundable tax credit for people who don't pay income taxes for health care. We have a progressive income tax system. I don't think he's running against that. We have a Social Security system which itself redistributes wealth. I don't think John McCain's running against that, although Joe the plumber, who he likes to argue-use on the stump, Joe the plumber said the other day he doesn't believe in Social Security. That's the crowd you're appealing to when you say this is socialism.
GREGORY: Hey, guys, before you respond to that, listen to Senator Obama now and his response. He really has taken the gloves off here in terms of responding to this tact about being a socialist. This is what he had to say.
(BEGIN VIDEO CLIP)
OBAMA: In the final days of campaigns, the say anything, do anything politics too often takes over. We've seen it before and we're seeing it again-ugly phone calls, misleading mail, misleading TV ads, careless, outrageous comments all aimed at keeping us from working together. All aimed at stopping change.
(END VIDEO CLIP)
GREGORY: A lot sharper than he was, even during the debate, Pat, about going after the kinds of attacks that he is getting from the McCain side, trying to really dismiss them.
BUCHANAN: No question about it. I think Barack Obama, from what I've seen of the clips the last number of days, has the mark and look of a winner on him. He is relaxed and he's making very humorous and witty comments. He is sort of dismissive of the attacks on him.
So I don't know. It may be this socialism attack is working. Look, I agree the other fellows. We do have -- 33 percent of the American economy is controlled by state, local, and national governments, and a lot more is regulated. I mean, taxes take up a third, so we do have a large measure of socialism. But look, my guess is, is McCain has-they've checked this thing out, they've polled it, they think it is their best attack line...
GREGORY: Right.
BUCHANAN: ... to hit working class folk. And they're going with it.
They don't have a lot of high cards, they're playing what they've got.
GREGORY: Right.I mean, the reality here, Lawrence, is the card they are playing is that Obama is outside the mainstream, he's a guy who's mysterious, he's not telling you the truth about who he is, and that he's got a liberal record. I mean, it's playing the liberal card at this stage of the game where you may have disaffected Republicans who aren't prepared to vote for somebody if they think he is that liberal.
Isn't that the play here?
O'DONNELL: That is the play. But certainly since the banking crisis erupted in this country, it seems that what the voter is waiting to hear is, tell me why I should vote for you? Don't just give me adjectives about the other guy. Don't give me labels about the other guy.
And "socialist" really, you know, generationally, sounds like a very, very old label. It sounds like a 1958 campaign to a lot of people. And so they're waiting to hear what John McCain and Sarah Palin have to say after they make their little socialist speech.
What are they then going to do? And I'm not sure what they're saying in those sections of the speeches, because they certainly don't interest the media enough, whatever else they're saying in those speeches.
BUCHANAN: Lawrence, the Republicans got wiped out in 1958.
(LAUGHTER)
GREGORY: At the same time, we've got Colin Powell, General Colin Powell, former secretary of state for President Bush, who went on "Meet the Press" with Tom Brokaw, and lowered the boom on McCain with a very high-profile endorsement of Obama.
This is what he said.
(BEGIN VIDEO CLIP)
COLIN POWELL, FMR. SECRETARY OF STATE: He has both style and substance. He has met the standard of being a successful president, being an exceptional president. I think he is a transformational figure. He is a new generation coming into the-onto the world stage, onto the American stage. And for that reason, I'll be voting for Senator Barack Obama.
(END VIDEO CLIP)
GREGORY: John Harwood, sum up the impact of this endorsement.
HARWOOD: You know, all endorsements are-we talk about them and somewhat exaggerate their effects. But in the world of endorsements, this is as big as it gets, because you have in Colin Powell one of the most popular figures in the country, somebody who has a particular entry with white voters, people with connections to the military. Those are a lot of the swing voters in states like Florida and Ohio that-Virginia, that Barack Obama is trying to appeal to. And so what you have is both preventing John McCain from building some momentum at the beginning of this, one of the last two weeks of the campaign, but you have the stamp of approval now from Colin Powell that Barack Obama can wield over the last two weeks. It's significant.
GREGORY: And what's significant to me, Pat, even though there may be criticism that this is an African-American endorsing another African-American, this goes to the experience argument, to those late deciders who may be wavering about Obama and whether he is up to the job. Here is a guy a lot of people trust saying he is up for the job.
BUCHANAN: Well, there is no question about it, this has hurt McCain and it has helped Obama. It has validated him to a degree in the defense foreign policy issue. But what is remarkable about this is that Obama won the Democratic nomination by running against and denouncing the war, and having opposed the war, which General Powell, right on national television, said he still approves and which he sold to the American people. I think there is a measure, I think, frankly, of vindictiveness toward the Republican Party here on Powell. I think he feels he was very badly used. He didn't say that, but his credibility was used at the U.N. on that phony case that was handed to him in which he probably didn't vet thoroughly. I think that's-I think there's a lot of motivations in here on Powell's part. But there's no doubt, he has burnt his bridges to the Republican Party.
GREGORY: All right. We're going to take a break here.
HARWOOD: David, the fact is that since Colin Powell continues to support the war, that makes it all the more powerful for Barack Obama to have his approval.
GREGORY: Right. All right. Got to take another break here.
Coming up next, will the charge that Obama's tax plan is "socialism" hurt him in those traditionally Republican states like Virginia? That's where he's making the hard run now. I'll go one-on-one with Obama supporter Virginia Governor Tim Kaine when RACE FOR THE WHITE HOUSE returns after this.
(COMMERCIAL BREAK)
GREGORY: Back now on RACE FOR THE WHITE HOUSE.Talk of Joe the plumber dominated the campaign trail again today as McCain's attacks on Obama's tax plans seem to be giving him a little more traction. Joining me now is Virginia Governor Tim Kaine, an Obama supporter. Governor, welcome.
GOV. TIM KAINE (D), VIRGINIA: Hey, David. Good to be with you.
GREGORY: Let's play what Obama said with Joe the plumber, who is enjoying maybe 1:14 of his 15 minutes, back on October 12th in Holland, Ohio. This is the exchange that they had. Take a look.
(BEGIN VIDEO CLIP)
OBAMA: It's not that I want to punish your success. I just want to make sure that everybody who is behind you, that they have got a chance at success, too. I think when they spread the wealth around, it's good for everybody.
(END VIDEO CLIP)
GREGORY: "When you spread the wealth around, it's good for everybody."
Did Senator Obama walk into a ditch here for himself?
KAINE: No, David. He basically said what I think most Americans believe. We want the middle class to do well.
Both of these candidates have tax proposals. Senator McCain focuses tax relief on the wealthiest individuals and the biggest corporations. That's what his choice is. Senator Obama says we need to give tax relief to the middle class and to small businesses. Small businesses like Joe the plumber. Get a tax credit for buying health care for their employees, pay no capital gains at all if you're a small or a startup business. And so that's basically all he was saying, and I think that's what Americans want. We want to help the middle class succeed and we want to help small businesses succeed. That's what we need to do to get the economy growing again.
GREGORY: Well, if you talk about small businesses succeeding, that's where Senator McCain's argument really locks in. Th is what he said recently on the campaign trail.
Let's play that.
(BEGIN VIDEO CLIP)
MCCAIN: Barack Obama's plan to raise taxes on some in order to give checks to others, it's not a tax cut. It's just another government giveaway that the liberals have been trying to push on America for a long time.
(END VIDEO CLIP)
GREGORY: Governor, it's again that liberal label, using tax policy to make the argument. Why don't you think it's effective?
KAINE: Well, they're getting desperate. They're throwing around a lot of kooky claims. I mean, tomorrow it will probably be that Senator Obama wants to make the National League go to designated hitter or something. I mean, who knows what they'll come up with, but the reality is...
GREGORY: That's not a bad idea, by the way.
KAINE: Yes. For I think nearly a year, I've been working with Senator Obama on economics. He is focused on small businesses. No capital gains tax for small businesses and startups, and tax credits so small businesses can buy health insurance for their employees. That's exactly the kind of thing that will get the economy moving, because as you know, David, it's-small business is where the job come from.
GREGORY: But is it really kooky when you see this kind of thing? In "The Bradenton Herald," this was an endorsement for McCain, and included this: "Obama's plan to cut income taxes for middle-class and low-wage workers sounds appealing, but will do less to produce more employment opportunities. In addition, the Obama income tax plan borders on socialism, what with the redistribution of wealth that would occur."
KAINE: That is-you know, again, we have to ask ourselves, what is the measure of a strong economy? What does success look like?
For Senator McCain, he basically says success means you try to help the wealthiest and the biggest businesses do well. Senator Obama wants him to do well. He just doesn't think they need our help. He says if you want to be successful, you've got to target the tax relief to middle class families and small businesses which are the back bone of the economy. That is at the very core of the way we ought to be operating this economy to get it growing again.
GREGORY: Let me ask you about one of the hard questions that comes up in the middle of this economy, which is a question of sacrifice. What is it that Barack Obama needs to say to the American people about the kinds of sacrifices that are going to become necessary when he gets into office, on the part of the American people, given the turmoil, the downturn that this economy is in?
KAINE: Well, I think the sacrifice that he'll probably talk about is, you know, I think what we've seen in this financial institution meltdown, is that easy credit, whether it's in huge businesses, in governments, or in families, can have some very significant consequences. And so, you know, belt tightening, folks matching up their expenses a little more with their income.
The average American family has 13 credit cards. The average American's credit card debt, if you're a credit card holder, has really ballooned since the early 1990s.
So I think, you know, going back to some of those old lessons about the ways to manage spending with expenses is something that all of us need to focus on. And whether that's at the family level or in some of these big Wall Street high flyers, that's important that we need to...
(CROSSTALK)
GREGORY: But do you think it's important for a leader to say to the American people, look, it's not just whether there was an adequate regulation, but all of us as Americans thought we could live a certain way and then this bubble burst and realized that we were not living realistically. We were living beyond our means, and we had no business trying to qualify for these kinds of loans, even if money was easy.
KAINE: Well, I think the home loans is just, you know, maybe not such a big idea, because homeownership is a great ideal. But, you know, second mortgages, instead of being used for home improvements, used for credit card debt or other kind of expenditures. And again, we see the Wall Street guys doing this.
GREGORY: Right.
KAINE: It was, you know, you made money if you could do any kind of bad loan, as long as you could sell it to somebody else before it busted. And I think there is a lesson in that for the entire economy.
And the senator, in a calm way, I'm sure, as president, will explain that painful lessons are learned. We make adjustments. We're tough people. Tough times don't last. But we'll last because we're tough people, and we will make those changes.
GREGORY: Right.
Let me talk to you about politics in Virginia. CNN/"TIME," a Virginia poll, has a 10-point advantage for Obama, 53-43. So, it's election night, and if you're on the phone with Senator Obama, you're going to say, Senator, you've got this thing wrapped up if what happens? What are you looking for?
KAINE: Well, first, I'll tell you, David, I'm not a believer in polls that show us ahead, because I'll tell you, we haven't won Virginia, as you know, as Democrats since 1964. So no matter what the poll tells me, I say we're the underdog until we break the streak.
So I'm telling him, I'm telling everybody, this thing is very, very close and we have got to run through the tape. Now, we're...
(CROSSTALK)
GREGORY: Talk about geography on election night.
KAINE: Sure. Well, he's got offices open in every last corner of the state. I think it really is the field effort.
It is the-you know, the TV ads can get you to the five yard line, but at the end of the day, it's the person to person, the persuasion, the folks in the community who are vouching for you. In that sense, General Powell's endorsement yesterday is huge for Senator Obama.
GREGORY: Yes.
KAINE: As you know, there's hardly a more military state than Virginia. One in 10 Virginians is a veteran. We've got active duty Guard, Reserve, military families, DOD employees. General Powell's endorsement is a huge plus for Senator Obama here.
So he just needs to do that person-to-person persuasion in the last two weeks. And a vote is a vote. In whatever region, a vote is a vote.
GREGORY: All right. Governor Tim Kaine of Virginia. Always a pleasure to have you on.
KAINE: Thanks, David. You bet.
GREGORY: Coming up next, "Smart Takes," why one columnist says McCain is taking a page from the Nixon playbook on his recent attacks on Obama. We'll have to ask Pat Buchanan about that when THE RACE returns right after this.
(COMMERCIAL BREAK)
GREGORY: Welcome back to THE RACE. Time now for "Smart Takes."In today's "New York Times," columnist Paul Krugman writes the following."Forty years ago, Richard Nixon made a remarkable marketing discovery by exploiting America's divisions-divisions over Vietnam, divisions over cultural change and, above all, racial divisions. He was able to reinvent the Republican brand. The party of plutocrats was repackaged as the party of the 'silent majority' - regular guys, white guys-it went without saying-who didn't like the social changes taking place." "It was a winning formula. John McCain's strategy and this final strategy is based on the belief that the old formula still has some life in it." Pat Buchanan, do you agree? But even if you agree, Is John McCain capable of really following through on that kind of strategy given his own career?
BUCHANAN: No, he's not. And the country is different today than it was back in '68 and '72. McCain is not a cultural warrior.
What we did back then, David, was we expanded the playing field from the traditional small government, big government, Republican, Democrat issues to involve all the cultural, social, moral issues in a society in turmoil where the traditional society was silent, but it was by far, the huge majority. And you defend their views and values, and what that brought across to us was what we called the northern Catholic ethics and the southern conservative Protestants, the folks that voted for Rizzo and Daley in the Democratic Party. And you brought them into the Republican Party, and we lost a small sliver which was basically left wing Republicans who were very trendy.
And the tradeoff was enormously affected. I mean, both Nixon and Reagan got 61 percent majorities and 49 state majorities, but the country has changed. And John McCain is not a culture warrior.
GREGORY: All right. We've got to take a break here. Coming next, the campaigns go on the attack. What will stick in the minds of voters? And later in the program, I go one-on-one with former presidential candidate and governor of Massachusetts, Mitt Romney, as RACE FOR THE WHITE HOUSE returns right after this.
(COMMERCIAL BREAK)
GREGORY: Up here on the back half of RACE FOR THE WHITE HOUSE, why Senator Biden says the next president will be facing a task like Hercules. Who is better prepared to lead the country? And does presidential candidate Mitt Romney agree that Senator Obama's plan is socialism? Plus the Palin factor, inside McCain's choice of his VP candidate. Back now on RACE FOR THE WHITE HOUSE. I'm David Gregory. The battle between camps continued over the weekend, with both VPs out in front. Governor Palin focused her energy on Senator Obama's tax plan, calling it, quote, socialist. Senator Biden spent his time defending Obama's experience. All this as President Bush's former Secretary of State Colin Powell threw his support behind Obama. He did it, of course, on "Meet the Press" with Tom Brokaw.
Inside the war room, tonight, John Harwood, cNBC chief Washington correspondent a political writer for the "New York Times," Pat Buchanan and Lawrence O'Donnell, both are MSNBC political analysts. And joining us now, Erin Burnett, anchor of cNBC's "STREET SIGNS" and "SQUAWK ON THE STREET." Welcome all. bLet's talk about Joe Biden and a comment he made at a fund-raiser over the weekend. We're always waiting for Senator Biden to say something that could be dissected by the media. I think we've got one now. This is what he talked about in terms of what is headed next for Obama, a time testing, should he be elected president.
(BEGIN VIDEO CLIP)
SEN. JOE BIDEN (D), VICE PRESIDENTIAL CANDIDATE: Mark my words, within the first six months of this administration, if we win, we're going to face a major international challenge, because they're going to want to test him, just like they did young John Kennedy. They're going to want to test him and they're going to find out this guy's got steel in his spine.
(END VIDEO CLIP)
GREGORY: What Biden says is that people around the country are going to need to stand behind Obama, because it may not be clear right away that he has made the right decision. So again, this time testing. Well, you might imagine that Senator McCain was all to happy to jump on that with a response. And he did. Let's show that.
(BEGIN VIDEO CLIP)
MCCAIN: Senator Biden said we will have an international crisis to test America's new president. We don't want a president who invites testing from the world at a time when our economy is in crisis, and Americans are already fighting in two wars. What is more troubling is that Senator Obama told their campaign donors that when the crisis hits, they would have to stand with him, because it wouldn't be apparent that Senator Obama would have the right response.
(END VIDEO CLIP)
GREGORY: He said, forget the apparently, Lawrence, because I can just tell you now, it won't be the right decision. What do you make of it?
O'DONNELL: This is a perfect example of why fund-raisers are normally closed to the press and anyone with a recording device. Fund-raisers are where candidates say the loosest things. They're accustomed to doing it. They're usually very closed groups and they kind of push the envelope. Biden would really like to have those words back. That was a very unwisely phrased thing. The way McCain jumped on it was a perfect. It was perfectly teed up for him to do it. We'll see what effect it has. I doubt it will get much traction. But really, they have to seal the doors on those fund-raisers for the rest of the run here.
GREGORY: Pat Buchanan, what do you think he was driving at here? And where was ultimately the endorsement for Obama in all of this?
BUCHANAN: It's Occum's Razor; the simplest explanation is often the best. Joe hasn't gotten any press for a long, long time. And he sees what Palin is getting. And I think he is reaching out there to excite his audience, and this fund-raiser. And he just goes too far. He has done it a number of time in his career. And I think this is just one of them. I don't think it is that big a deal, however, because I don't think a lot of folks take Joe's statements seriously.
GREGORY: I think there is a real question, John Harwood, of how much testing there will be of Senator Obama on his views, on his diplomacy. Any new president gets tested to some degree. It just seem like Joe Biden was suggesting no, this is going to be a bigger test. This is going to be like John Kennedy, a new leader on the stage. We know the history of that. We know that John Kennedy and those around him thought he was terribly out-maneuvered by Khrushchev in their first meeting.
HARWOOD: Yes, look, it is boiler plate in one respect. The endorsement that you ask about before came at the end when he said the guy has steel in his spine. All that's good. However, as Lawrence said, this provided a nice opening for John McCain to jump in. And you have to wonder what exactly will that test be? We know that John Kennedy in his debut, the Bay of Pigs, take that example, didn't do so well. So playing on some of those memories may be helpful to John McCain.
GREGORY: Erin, let me turn to you. I want to talk about the economy. I want to talk about socialism. So the politics of the economy, and the fact that there is so much emphasis on tax policy and whether this redistribution of wealth idea is a bad idea. The reality is that our polls show us that American are not as tuned in to the issue of taxes and spending as they are to job right now. That's what is occupying a lot of your day. Isn't it?
ERIN BURNETT, CNBC ANCHOR: Certainly. Jobs are by far the most important issue right now. It is amazing, when Obama made the comment of we want to spread the wealth around, it is good for everybody. And obviously Sarah Palin jumped on.
The reality is we've always had a progressive tax system. Sales tax may be an exception to that, but our nation has. John McCain isn't proposing anything different. So the claim of socialism is a tough one to make, especially given that it is a Republican administration that's buying stakes in the banks.
GREGORY: To the tune of a trillion dollars. That hasn't come up yet. It's the Republican party, the Republican-led White House that is going to pump a trillion dollars to bailout the financial system.
BURNETT: That's right. Usually you would define socialism as the government taking a stake in key industries in the country, like banking or telecom or airlines. Obviously, it is a Republican administration that's doing just that right now. So the charge does appear to be a little bit silly. Maybe we're getting off the whole discussion of jobs. You're completely right on that. It jobs, jobs, jobs and it is a four-letter word.
HARWOOD: Were are we 100 percent sure that Erin Burnett isn't a socialist?
GREGORY: Go ahead, Pat.
BUCHANAN: On the jobs front, I noticed the "Financial Time," Obama is hitting it well. I thought he hit the trade thing. He has ads running down in North Carolina. They're sending your jobs to China. They have all those mills down there that have shut down, furniture factories. I think that's one of the reason he's driving and doing very well in North Carolina. Those folks, to them it is the trade deals that are sending their jobs abroad.
GREGORY: Yet, there seems to be on the campaign trail from Governor Palin some remorse about the tone of the campaign. This is what she said.
(BEGIN VIDEO CLIP)
GOV. SARAH PALIN ®, VICE PRESIDENTIAL CANDIDATE: If I called all the shots, and if could I wave a magic wand, I would be sitting at a kitchen table with more and more Americans, talking to them about our plan to get the economy back on track and winning the war, and not having to rely on the old conventional ways of campaigning that include those robo-calls, that include spending so much money on the television ads that I think is kind of draining out there, in terms of the Americans' attention span. They get a bit irritated with being inundated.
(END VIDEO CLIP)
GREGORY: And yet, for all of that, the McCain campaign has made a decision to run, by the estimation of a lot of people, a conventional campaign here down the stretch. Why do you think, if the base is not already locked up with Governor Palin, and it seem they want to get a lot of independent voters, why run such a base campaign down the stretch?
O'DONNELL: Well, because Sarah Palin does not have a magic wand. And this is really all they've got. They've got to drive home whatever message they possibly can to try to get traction. If it has a fear component in it for people who are starting to drift toward Obama, then that's great, too. That's what is going on in those robo-calls. Those are definitely fear-based robo-calls, as they usually are, by the way, from each side. The robo-calls are never nice messages to pick up your phone and get.
HARWOOD: David, there's a strategic element, too, which is that the tightening in the polls that we've seen in some surveys has been conservatives coming home. Republicans are hoping to use that to kind of create a narrative of McCain closing at the end. So when you get some of those conservatives mobilized, you're hoping for a follow on effect later in the last ten days.
BURNETT: Does anyone listen to those robotic call?
(CROSS TALK)
O'DONNELL: That's a very good question.
GREGORY: Yes. That's a question. Do people actually stick around and listen to them When they hear it is an actual recording? Pat, I guess, you know this. Do you hang up on them, Pat?
BUCHANAN: They come right on through. You know what this does tell us about Palin, she clearly is being programmed and scripted to do and say the thing she's doing. And what you've got coming out there is her naturalness. I think the way she used to campaign in Alaska, saying I don't like to get out there and have to do all this same stuff every day. Can't we get back to the campaigning in the old way?
HARWOOD: It have been because she was hanging around with all those "Saturday Night Live" cast members.
GREGORY: All right, I got to get a break in here. Thanks panel, very much. Coming next, former presidential candidate and governor of Massachusetts Mitt Romney. I'll ask him if he thinks Obama's tax plan is socialist and if he thinks Governor Palin is helping the McCain ticket. You might be surprised by the answers. THE RACE comes right back after this.
(COMMERCIAL BREAK)
GREGORY: The McCain/Palin campaign is continuing its assault on Senator Barack Obama's tax plan today. Joining me now for more is from former Massachusetts Governor Mitt Romney, a supporter of Senator McCain. governor, welcome.
MITT ROMNEY ®, FMR. GOV MASSACHUSETTS: Thanks, David. Good to be with you.
GREGORY: Senator George Voinovich of Ohio had this to say about Senator Obama, according to the "Cleveland Plain Dealer," quote, "he is left of Ted Kennedy. With all due respect, the man is a socialist." Do you agree with that, governor, and how do you back up such a belief?
ROMNEY: I wouldn't go so far to say that he is a socialist, by any means. but what I would say is that he is an extremely left wing politician. He has a view of health care, taxation and business which is very left, and, frankly, probably more left than Ted Kennedy.
GREGORY: It is interesting though. You say that he has a vision of tax policy that is so far left. This was Senator Obama's response. And he hearkened back to Senator McCain's previous position on the Bush tax cuts. Listen to this.
(BEGIN VIDEO CLIP)
OBAMA: I want to roll back the Bush tax cuts on the very wealthiest Americans, and go back to the rate that they paid under Bill Clinton. John McCain called that socialism. Just a few years ago, he himself said those Bush tax cuts were irresponsible. He was right then. And I am right now.
(END VIDEO CLIP)
GREGORY: Governor, how do you answer that argument?
ROMNEY: Well, I think Barack Obama made it pretty clear as to where he's going with his plan. That is, when he spoke to the famous now Joe the plumber, he said I want to redistribute, spread it around, spread some of this money around. That's a very different place than Ronald Reagan was. I think we recognize that particularly with a difficult economy like we have right now, we want to not raise taxes on anybody. And the last thing we want to do is start taking money from one group and giving it to another, particularly the people we're taking it away from are the people who are helping create new businesses and new jobs, like Joe the plumber.
GREGORY: You acknowledge the fact that he would give a tax cut to most people who are paying taxes.
ROMNEY: Actually, what he would be doing is taking money from the top five percent of the taxpayers. And they represent about 60 percent of the taxes paid. And then giving money to everybody else. But, in fact, most of that money, based on my calculations, will be going to people who don't pay any taxes at all.
GREGORY: If the Bush tax cut is the answer, and we've seen this work its way through two terms of his presidency; why hasn't it worked? We're on the brink here of a total economic meltdown. This tax policy doesn't seem to have prevailed.
ROMNEY: I don't think anyone suggests that the reason for our economic slowdown is because taxes were too low. I think the reason we understand we got into the trouble we're in is because of the subprime mortgage crisis. That spread to the overall credit markets. It has nothing to do with low taxes. Anyone who thinks that the right way to get the economy going is raising taxes on any segment of our population, I think, is sorely wrong.
GREGORY: But President Bush said just last year, those rebate checks that were coming through the mail as part of the stimulus, that that was going to have a big impact. He was wrong about that.
ROMNEY: You know, I don't think that just sending checks out to people and hoping they spend money makes a big difference, particularly if you're borrowing money from the very people that you're sending checks to, which is in effect what's happening when the government is running a major deficit like we are. I think if we're going to have a tax stimulus program, it needs to have a long term impact, such as lowering capital gain rates or lowering corporate rates, or potentially focussing the area of rebate on places that would lead to, let's say, reducing our energy costs in our home or automobiles. There are ways to stimulate the economy. But just sending out a check I don't think is very effective.
GREGORY: Let me ask you about the big news that everyone is still following today. That is the endorsement of former Secretary of State, General Colin Powell. He made it "Meet the Press" with Tom Brokaw. Watch this.
(BEGIN VIDEO CLIP)
POWELL: I found that he was a little unsure as to how to deal with the economic problems that we were having. And almost every day, there was a different approach to the problem. That concerned me. I got the sense that he didn't have a complete grasp of the economic problems we had. And I was also concerned at the selection of Governor Palin. She is a very distinguished woman, and she is to be admired. At the same time, now that we have had a chance to watch her for some seven weeks, I don't believe she is ready to be president of the United States, which his the job of the vice president.
(END VIDEO CLIP)
GREGORY: Two big issues there, governor. Let me start with the first. Of course, General Powell is talking about John McCain when he says that he is unsure about the economy. What about John McCain's record impresses you that he is ready to handle the test that is an economy in such turmoil?
ROMNEY: He's been in office some 25 years. He's been in Washington when we've had good times and bad. And he's seen what it is that creates more jobs and a better economic future. He's laid out a plan that reduces taxes on job creators. He has also lowered taxes across the tax base of our country. That's the way to encourage economic growth. His plan works. Barack Obama's plan, which is taxing people who create jobs at a higher rate, is something I don't think is going to be very effective.
GREGORY: Again, the facts are that he opposed the Bush tax cut. You say he's lowered taxes in his time in office. That's not what he did initially. He did not initially support the Bush tax cut.
ROMNEY: You know, he could explain the Bush tax cuts and his view at that point. But at this stage, John McCain does not believe we should raise tax on the American people in any segment of our society. I agree with him on that front. Raising taxes on people creating jobs will do nothing but hurt the American working people. Far more interest in this country for people who want to have a good job than those who are just looking for a check from Barack Obama.
GREGORY: Let me ask you but the vice presidency, generally, because this is an open secret here, that you were on that short list of people that were being considered. Your relationship with John McCain was always an issue. The point was that it didn't appear that you all got along very well. Jane Mayer in the "New Yorker" writes about the selection of Governor Palin and includes this-this is a quote from David Keene of the American Conservative Union, according to the "New Yorker," "I told Mitt Romney not to wait by the phone because he doesn't like you. With John McCain, all politics is personal."
Do you think that your poor relationship with Senator McCain got in the way of what would have been a better selection for a running mate, and that is you on the ticket, particularly with the economy?
ROMNEY: David, I have to tell you the truth, and that is I wanted the top job. I worked real hard to get the top job. I was not waiting by the phone for the number two job. I did not expect to get to get a call from John McCain on that front. I thought it might have been Tom Ridge or Tim Pawlenty, Rob Portman. I was surprised by the Sarah Palin selection. But, you know, she has energized the base of our party. She has great executive experience. And I think she'll add to the McCain team.
GREGORY: Do you acknowledge, governor, that it could be a huge potential problem for McCain that when people look up and say who could handle us in a real crisis here, whether financial or it might be international, it might be terrorists, that even conservatives are saying, no, Sarah Palin is not up for the job.
ROMNEY: I think the real question is who is at the top of the ticket. There, when you have someone like Joe Biden saying what he did he over the weekend, which is that an Obama presidency is going to get tested in the first six months of his time in office and there is a question of how well he'll do, that is a much bigger issue than Sarah Palin's dealing with international affairs. She'll be vice president. John McCain, who has extensive experience, will make the right decisions. He has been test and proven time and again. And I think it comes down to John McCain and Barack Obama.
GREGORY: But at the top of the ticket, John McCain as president will be 72 years old. You can't say that it's not a factor in people's minds when she's so close to the presidency.
ROMNEY: I think she is a plus to the team. I think having a person who has executive experience, as she does, and frankly no one else has on that playing field-I think it is a positive thing.
GREGORY: OK, Governor Mitt Romney, always a pleasure to have you on.
ROMNEY: Thanks David, good to be with you.
GREGORY: Coming next, Palin's popularity. New details on how and why McCain decided to pick the Alaskan governor as his running mate when RACE FOR THE WHITE HOUSE returns after this.
(COMMERCIAL BREAK)
GREGORY: Back now on RACE FOR THE WHITE HOUSE. What was behind Senator McCain's VP choice of Governor Sarah Palin. Joining me now, Jane Mayer, who is a writer for "The New Yorker." She has a new piece on this very topic. Jane, good to see you.
JANE MAYER, "THE NEW YORKER": Glad to be with you.
GREGORY: Let me play, or put up a portion of your piece in "the New Yorker." And you sum up Palin this way: "Palin initially provided the McCain campaign with a boost. But polls now suggest that she has become liability. A top Republican close to the campaign said that McCain's aides have largely kept faith with Palin. They have been impressed by her work ethic and by what a quick study she is."
They don't have a lot of choice right now but to stand behind her. Ultimately, is not the prevailing view that she has provided what they needed at the time, which was excitement in the party?
MAYER: Yes. She energized the base. People said that the convention felt like the night of the living dead until they picked her. And without a lot of extra money for paid campaign workers, they need to get the volunteers out there. She is good for that. And McCain spoke about it over the weekend, saying it was a good political calculation from that standpoint.
GREGORY: What led McCain ultimately to make the choice?
MAYER: Well, I mean, the truth is, if you talk to people close to him, he was leaning towards Joe Lieberman. And he really wanted to. He has a great comfort level with Senator Joe Lieberman, who is an independent. His top aides talked him out of it, almost at the last moment. At that point, they felt the pickings were somewhat slim. They wanted to do something unconventional. The truth is, though, Palin-there is this myth that she comes out of nowhere and she is anti-Washington, and against good old boys of Washington. In truth, what I talk about in the story, she waged a kind of Sub-Rosa campaign, where she kind of wooed a number of the top Washington insiders to get their attention.
GREGORY: And in fact, Charlie Black, who is a top campaign adviser to Senator McCain, is quoted in the piece that he reportedly told McCain, if you pick anyone else, you're going to lose. If you pick Palin, you may lose.
MAYER: That's right. So, basically, the top people in McCain's campaign told him he couldn't have his first choice. He had to go in some different directions. Meanwhile, I mean, what was interesting to me was that you think of Palin as this kind of fresh face out of absolutely nowhere. But, in fact, she had been entertaining and even taking a helicopter, sort of, rows of top pundits as they came through from Washington. The people that she has made fun much for being Washington insiders were invited into her living room, and they fell for her one by one. They all went back and wrote stories saying, she's the greatest. You've got to pick her.
GREGORY: It was interesting. She was on "Saturday Night Live" over the weekend with a very likable, very winning appearance, where she didn't do too much. She has tremendous poise and presence in front of the camera and a natural sense of humor. And Alexandra Stanley wrote in the "New York Time" wrote that we sort of know that about her already. Isn't that still the strongest card she has to play, which is popularity within the Republican party, a fresh face, and somebody who can provide the kind of energy that we can is going to exist on the Democratic side?
MAYER: Well, I don't know. That is in the pro column. In the anti column, increasingly, what we're seeing is that if she has problems with the media, the part of the media she has the most serious problems with, frankly, are other people who are on the conservative end of the party, who are saying this is a joke. And you have-one by one, you've got Peggy Noonan. You've got Chris Buckley saying he is going to endorse Obama. All kinds of people-
GREGORY: Jane, got to get in there. We're out of time. Thank you so much. That's the program. "HARDBALL" up next. Thank you.
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