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Politics and the Economy; Testing President Obama; Jobs Outlook

Aired May 7, 2010 - 19:00   ET


JOHN KING, HOST: Thanks, Wolf, and Happy Anniversary. The job market is looking up tonight. The economy added 290,000 jobs in April, the biggest monthly gain in four years, but the financial markets had another tough day and are now in negative territory for the year. If those mixed signals confuse you, you are not alone. There's no doubt the economy is out of recession and into recovery, and that is the bottom line the president wanted to stress today carefully.


BARACK OBAMA (D-IL), PRESIDENT OF THE UNITED STATES: We now know that the economy has been growing for the better part of a year and this steady growth is starting to give businesses the confidence to expand and to hire new people.


KING: There's good reason for the cautious tone, even with all those new jobs the unemployment rate went up from 9.7 percent to 9.9 percent because many Americans who had been dropped from the statistics because they stopped looking for work suddenly decided to test the job market again. Around your kitchen table the jobless rate is the economic indicator that likely matters most. It's a huge political indicator too. The higher the rate, the tougher the odds for the party in power come Election Day, which is why the president added this.


OBAMA: We're not going to rest until we put this difficult chapter behind us. And I won't rest until you and millions of your neighbors caught up in these storms are able to find a good job and reach a brighter day.


KING: Mr. Obama isn't on the ballot this November, but his leadership is, how do you think he's managing the economy? What about the war on terrorism, or big unexpected challenges like the massive oil spill in the Gulf of Mexico? With me tonight to talk about that and more the Democratic strategist and CNN political contributor Paul Begala and Republican strategist Ed Goeas -- gentlemen, welcome.

Let's start with the economy and I want to show you the statistics, both of you when you're running campaigns worry most about. One is the unemployment rate. Here's a look at when President Obama took office, the unemployment rate in January 2009 was 7.6 percent. It is now as we just discussed 9.9 percent and going up, not something you like if you're president of the United States and you party has the majorities in Congress.

Now the other question is what's the direction of the country? Do people think right track or wrong track? Are you satisfied with the direction of the country? A year ago 23 percent said yes, 29 percent now, a slight improvement, the dissatisfied -- two-thirds of Americans still say they are dissatisfied with the direction of the country.

Paul, I'll start with you because it is the Democrats who have to defend on the ballot this November. If you look at those numbers, five months to Election Day, you're in a ditch.

PAUL BEGALA, DEMOCRATIC STRATEGIST: Oh absolutely. I mean that's terrible news for the Democrats politically. It is good news economically, whether it will be too little too late, I don't know, 290,000 jobs is nothing to sneeze at. That's a robust -- well not robust, a good, solid month, it's the best month we have had in several years, but politically, the Democrats are going to have to a lot of months back to back.

But the other piece of this is the sense are we moving in the right direction. I'm glad you showed that poll. Pollsters like Ed ask that and they've been asking it for year, and that's another indicator and that's also not going -- it's inching toward the Democrats, but not enough for my comfort level. My biggest problem with what the president does, he just did it again. He talked about the recession as a storm.

A storm is an act of nature, barometric pressure shifts, winds blowing -- this was not a storm. It was a mugging, and it was the Republicans who mugged the economy. That's what he needs to do. That's what Ronald Reagan did. Ronald Reagan sustained only average losses in '82 despite unemployment going up every month because he blamed the Democrats. Obama needs to blame the Republicans.

KING: Do you have a point?

UNIDENTIFIED MALE: He always has a point --


UNIDENTIFIED MALE: If you were advising Obama would you be telling him to beat up on the Republicans?

UNIDENTIFIED MALE: Usually the more wrong Paul is, the stronger he --


KING: You sound like my wife. ED GOEAS, PRES. AND CEO, THE TARRANCE GROUP: No, I mean in terms of the economy -- I mean here's the bottom line, is that you're going to see the effect of the economy pretty much be where it is today on election day. One of the things we look at from a polling standpoint is that to turn around that recession mentality of the voter to a growth mentality, to be able to get the consumer confidence up, you basically have to have six solid months of nothing but good economic news before they reach that point.

That window has closed. One of the things that was right in terms of what the Obama administration tried to do coming out of the State of the Union message was saying we're only going to talk about jobs and the economy. Then they talked about health care for two and a half months. Now they're into -- they have the storm. They have the stock market. They have all these other things that are occurring. That is all just going to muddy this up that much more, including what happens with the Supreme Court debate --

KING: Even if it goes well, it could get in the way of this economic message.

GOEAS: It gets in the way of the economic message because it's not that focused on nothing but the economy. Now when you look at the economic numbers there was some other bad news in those economic numbers. The U-6 (ph), which is the -- not only the unemployment rate, but the total underemployment rate --


GOEAS: -- rose to 17.1. It's the third month in a row it has actually increased. That it is almost back to the all-time high of 17.4 back in October. So the under the service numbers are not good. And one thing I would point out about the increase in jobs, 66,000 of those were actually temporary census workers.


KING: And there will be more of those next month -- there will be more of those next month and then they disappear in the summer, so the question is does it last. I want to do another historical comparison (INAUDIBLE) look April 2010 versus April 1994 -- 1994 was when the Republicans caught the wave in the Clinton administration. Paul, you remember that all too well (INAUDIBLE) from your days (INAUDIBLE). The unemployment rate now, 9.9 percent, voter dissatisfaction, as we just said, the wrong track number, 66 percent.

Back in April of 1994, the unemployment rate was much lower, 6.4 percent, voter dissatisfaction, a little bit higher -- seven in 10 Americans thought we were on the wrong track then. That's a pretty even match if you look at those numbers, which again, and as we continue the conversation, I want to bring up a map.

I can bring it up on the table and here as well because I want you to look -- you guys can look at that here and our viewers can see it. The high lighted states are the states where the unemployment rate is above 11 percent. California, big Senate race, big governor's race, Nevada big Senate race, Illinois big Senate race. I could go on and on -- Ohio big governor, big Senate race, Florida big Senate race.

And you see all those states down in North Carolina big Senate race. When you look at this map and you look at those numbers in the comparison of 1994, what does it tell you about the political economy (INAUDIBLE)?

BEGALA: I have had a three-word strategic plan for Democrats, built an ark. No, I have lived through the tsunami and the flood of 1994, but here's the difference, I think there are several differences. One is Democrats are building an ark. Back in 1994, I was working for Bill Clinton, I was one of the reasons we lost 54 House seats and eight Senate seats, not that I remember my failures, but I do.

But one of the differences was Democrats didn't really believe it. They thought if they ate right and exercised, they would always be in the majority (INAUDIBLE) we had to check the Constitution and make sure it was allowed. Well now these Democrats know and the people who are most vulnerable in these states, they tend to be younger, they tend to be more moderate, and they tend to be very tough battle-tested politicians. This is a better class of people frankly, but politicians who are at risk.

KING: And to that point, as you answer it, they also say, the Democrats do that despite the other noise, the competing issues, some of them very important that you talk about, but the Democrats say we're going to do small business tax cuts as soon as we come back, then we're going to do some aid to states to help them deal with all those layoff of teachers that governors and mayors say they're going to have to go. They say they will do more pieces of economy and jobs legislation. Your sense is that even if they're good pieces of legislation, it won't break through.

GOEAS: It isn't going to break through. And you know compared to 1994, it's very interesting, we just did a survey that and asked how concerned are you about spending in Washington? Seventy-two percent said they were extremely or very concerned about spending, another 18 percent taking it up to 90 percent said that they were concerned about spending. In 1994, we were tracking, we talked a lot back during that time, the intensity -- there's two things that come into play in the off-year election.

One is the intensity of the base and the other is who are the angry independents? Right now the intensity of the base -- in 1994, it was seven points higher at this period of time that the Democrats -- Republican intensity and the Democrat intensity. Today it's 14 points higher.

It is double what it was in 1994 and we all know who the angry independents. The angry independents are angry not at who are you going to point blame on the economy, but who you point blame at on the solutions, which is all that spending that they're seeing in Washington.

KING: Quick time out here -- we're going to be back -- continue this conversation. The president's crisis management skills got a real workout this week -- in a minute, we'll get some grades on how he did.


KING: Continue the conversation with Democratic strategist Paul Begala, Republican strategist Ed Goeas. The president had a big week, tested on the terrorism front, tested in the crisis management when it comes to the Gulf of Mexico spill. He also has a Supreme Court pick, as we also noted, and other big challenges.

Let's start with terrorism. When they arrested the Times Square suspect; there were Republicans and some other conservatives quickly saying why didn't you read him his Miranda Rights. The president knew this was coming. I want you to hear in the hours after the arrest, the president made a point of rebutting his critics.


OBAMA: The American people can be assured that the FBI and their partners in this process have all the tools and experience they need to learn everything we can and that includes what if any connection this individual has to terrorist groups and it includes collecting critical intelligence as we work to disrupt any future attacks.


KING: You have both watched the narrative all week long, Republicans saying, you know, look, it's not a strategy and the Democrats saying actually not only did we stop this guy, he's cooperating with us and we have stopped other attacks, where does this go in the political discourse?

BEGALA: I think it's useful that this president -- and I was just criticizing him before for not being partisan enough -- but this is where that low blood pressure helps a lot, in a crisis he's very cool. I think it's one of the reasons he's our president. When the economy melted down in October, turned out he was the one who looked like a grownup. And here again partisans are screaming and yelling, and he's protecting America and he doesn't seem like he's losing his head while all those about him are losing theirs and blaming him. I think it inspires a lot of confidence.

GOEAS: I think that, you know, quite frankly --


GOEAS: I was waiting for him to finish. I didn't want to interrupt. The president did a good job this week and I think the key thing that we saw in terms of this issue is you saw a federal, state and local law enforcement really work together well. I think there are concerns on how this guy got as far as he did. But the bottom line is, is that we all know that all it's going to take is one or two smart people who finally gets rid of those defenses.

I think the bigger issue here is that going back to the economy -- that these stories only cause disruption and uncertainty. I mean the American people have kind of moved from being angry to being scared and the scared -- being scared can come from any direction and having the terrorist threat kind of put right in their face again is something that will add more to not the president's numbers, but more add to how they feel about the economy.

KING: Something that got lost in the week because of the big events, but something the president said last weekend at a commencement address where he was talking to students at the University of Michigan about the coarseness in his view of the political climate. I want you to listen to this.


OBAMA: The problem is that this kind of vilification and over the top rhetoric closes the door to the possibility of compromise, it undermines Democratic deliberation, it prevents learning, since after all, why should we listen to a fascist or a socialist or a right wing nut or a left wing nut?


KING: So Paul, based on your earlier comments, that's a good message to young students, but not a good message in a campaign (INAUDIBLE) should be more partisan?

BEGALA: Yes, you know it would have been a much better speech if the president had said, like all politicians, I come to this with unclean hands. OK, now he didn't host "CROSSFIRE" like I did, OK, he didn't ruin America like I do, but he is a politician and he has thrown some tough shots in his life. You don't get to where he is coming out of Chicago or Texas or anywhere else without having done some tough things and maybe some things he looks back on now with regret.

So I didn't like the speech to tell you the truth. Now I'm not big for civility anyway, as you know. No, I think it's overrated and I think if people have tough differences about issues and ideas, they should fight them out. I think it would have been a better speech if there was the humility of saying look, I've done it too, guys. I'm no better than anybody else.

KING: He won the White House, took it from your party. Is that the right tone for this year -- in terms of his (INAUDIBLE) he as a political messenger and weapon in the midterm year?

GOEAS: I think part of what he has to do is continue to try to move the ball forward. I think one of the things that the Democrats didn't get out of the health care bill is they thought it would dampen the enthusiasm of the Republicans and increase the enthusiasm of the Democrats. In fact what happened is it didn't dampen the enthusiasm of the Republicans.

It popped the enthusiasm of the Democrats, but it came back down after seven, 10 days. So they're going to have to have a series of things to -- at least try to resurrect a little bit the intensity was there. Actually I saw the speech. I read the whole thing. I got a copy of it and sent it to Ted Strickland today. Since he seems to be starting off his campaign with negative TV spots, I thought maybe he would like to read it --


BEGALA: -- Christian minister as well --

KING: And a Democrat who's leading at the moment.


KING: Two Democrats (INAUDIBLE) ahead at the moment. All right, Ed and Paul, I need to call a time-out here, but you guys will be back later in the show (INAUDIBLE) "Play-by-Play" -- still plenty more to come here -- let me give you a sense.

We'll go over to the "Magic Wall". Many of you might be looking across the Atlantic to try to figure out just what happened to the British elections. We'll break it down for you when we go "Wall-to- Wall". The conservatives carried the day, but not by enough to get a majority so the theme in Britain right now, let's make a deal.

We'll go "One-on-One" in just a few minutes with one of the president's top economic advisers, Christina Romer. She'll give us her view and the president's view on how fast the economy will come back. And we also talk about whether to cut the deficit the president is open to raising taxes.

And it's Friday so you get to "Make Your Case". We asked you earlier in the week what are your views on the Gulf oil spill and should there be more or less offshore drilling -- that ahead when we come back.


KING: "Wall-to-Wall" tonight, an update on the elections in the United Kingdom. You might say coalition building is the big challenge today. Let's take a look at the results. The conservatives carried the day, but if you see, they won -- it takes 326 to win and the conservatives did not quite get there. They won only 306.

The Labor Party which is in power now, 258 seats in the House of Commons; the liberal Democrats, 57 seats so far, so the challenge is you have to get to 326. Can you form a coalition government? The conservative leader David Cameron says that is his challenge now. He will reach out and try to form that coalition. The current Prime Minister, Labour's Gordon Brown says he will wait in the meantime to see if the conservatives succeed.


DAVID CAMERON, CONSERVATIVE PARTY LEADER: We campaigned for change, not more of the same and people responded to that giving us a higher share of the vote than Labour achieved at the last election.

GORDON BROWN, BRITISH PRIME MINISTER: The outcome has been delivered by the electorate; it is our responsibility now to make it work for the national good. (END VIDEO CLIP)

KING: So how might all this play out in the days and weeks ahead? Let's head over to the "Magic Wall". We'll show you some of the possible scenarios and just why this matters to you over here in the United States. First let's take a look at the likely scenarios, if you play this out here a conservative minority government, well, see this is where they are -- they're short. The finish line is this white line here -- you need 326, so if the conservatives can cut a deal with the liberal Democrats who came in third, liberal Democrats are the goal here -- that would get you a coalition.

Now a number of policy differences between the two parties, that's what makes forming this coalition so difficult. But that is the first and the most likely scenario. Conservatives and liberal Democrats getting together -- that would make Mr. Cameron the prime minister; other minister ships will be spread out. Now if that fell apart, if those talks fell apart, Labour and the liberal Democrats could try to form a coalition, but look even if they put together all of their seats in the House of Commons they come up just short, which is why this for now remains the most likely scenario, but this is something we have to watch play out in the days ahead.

Well what is the history of this? Let's go back and look because you have to go all the way back here to the late '70s before -- to the last -- you see a period here -- a Labour Prime Minister Callahan (ph) and then this is the Great Britain of Ronald Reagan. Margaret Thatcher came to power, she was succeeded as the Soviet Union fell in 1991 by John Major who was also a conservative, a Tory prime minister and then you come through 1994, the European Union emerges and in 1997, Tony Blair comes to power, the new way of doing things, the new Labour campaign modeled very much after Bill Clinton's campaigns here in the United States.

2001, George Bush is in power at that point in the United States. Blair working closely with him, then succeeded, Tony Blair was, by his top deputy Gordon Brown, this is where we are now. Gordon Brown dampened by the economic crisis. This is Britain over the last 30 years. We will wait to see what is next. And if you watched the campaign in Great Britain, boy, there are a lot of similarities.

Number one, for the first time the Brits used televised debates, which we have used here in the United States going back to the 60's. The big issue is just as they are here -- the economy, immigration -- all of the candidates running tried to link themselves to President Obama, promising to be Atlantis's (ph), as they say. Cameron emphasized hope and change -- remember those words. Brown banked on a big economic upturn, it didn't happen.

That is a lesson for Democrats running on this side of the pond this year. And conservatives took a very hard line on immigration. We have seen that play out on our side of the Atlantic just in recent days, so fascinating parallels and perhaps some lessons in Great Britain that will play out here in the United States come this November. And when we come back to this side of the pond after the break, I go "One-on-One" with Christina Romer. She heads the president's Council of Economic Advisers and she'll talk about the new job numbers and what she thinks they mean and later have a new surprise in the Florida Senate race.


ANNOUNCER: It's time to go "One-on-One".

KING: More people in the country are getting jobs, but the unemployment rate is going up. I went over to the White House this afternoon to go "One-on-One" with Christina Romer who chairs the president's Council of Economic Advisers.


KING: You could see it in the president's face today and you see it in all the statements that on the one hand you want to celebrate, but you have this caution inside you because of the long-term chronic unemployment. How do you balance the joy with the reality?

CHRISTINA ROMER, DIR., W.H. COUNCIL OF ECONOMIC ADVISERS: Well I think, I mean you captured it correctly, I wouldn't call it the long- term chronic unemployment, I think the fact that we still have a severe unemployment problem, you can't be at an unemployment rate of 9.9 percent without knowing you've got to do something about that. That is a problem. What you can celebrate or at least feel encouraged about is being on the right trajectory and any day when you're adding 290,000 jobs that sure feels like a much better trajectory than we were this time last year when we were losing hundreds of thousands of jobs.

KING: And yet even if you add that many jobs next month the rate could stay the same or even go up again because you have all those people who disappeared, stopped looking for jobs, millions of them who became discouraged. How hard is that to sort of sell to the American people, saying look, trust us, despite that number, the unemployment number, things are getting better.

ROMER: No, I mean it's just the reality. I mean we have actually been talking about this for a while, because I knew this was a natural part of a recovery process, when you have a recession this severe, you do have a lot of people drop out of the labor force and what we saw this month we have actually seen for the last several months, have a lot of people coming in. In April, it was 800,000.

KING: So what is your projection going forward in terms of month to month job growth? A lot of outside economists say they actually expect a bit of a slowing in the second quarter, in part because some of the stimulus money has dried up.

ROMER: Well I think we're going to be watching that, we certainly know in the short run, there's going to be a big bounce coming from census jobs, so this month actually not that many, only 66,000, so most of that 290,000 was private sector job creation. I think all the estimates are May is when they hire a lot of temporary census workers so we'll have to be, you know sort of watching those numbers carefully and then those will go away over the summer.

So what I think is reasonable is that we're going to keep you know having good, solid job growth. What the president is thinking about is what more can we do -- that's why he talked in the Rose Garden today about the small business lending fund or how thankful he was that the House was moving on his home star energy retrofit program. He mentions the troubles in state and local governments and that we might need to do more there, all of that is to make sure that the second half of the year looks as good -- if not better than the first half.

KING: Let's talk about that in this political climate, you know that there's still a debate over the stimulus that was passed way back. As you look forward, state and local governments, there are estimates that anywhere between 100,000 to 300,000 teachers could lose their jobs. Mayor Bloomberg in New York, more than 6,000 just in New York City, and yet you know the controversy, some of the administration's Republican critics say if you're going to spend money to stimulate the economy, make it tax cuts, things that stimulate private sector hiring, not public sector, keeping jobs. How much does state and local governments need as part of -- I would call it a second or another round of stimulus -- I know you don't like that term because of the politics of it here, but how much do they need?

ROMER: They have a big budget gap, so the numbers that you hear over the next couple of fiscal years, it's you know probably $300 billion that they're going to be -- you know having to fill in some way. Of course you know the teacher piece that I think everyone agrees is really important is much smaller than that. You can get a kind of sense there are bills in the House that have been talking about maybe another $25 billion for state and local governments has being part of something that could be very helpful.

You know, the president's very aware we're in a very tough budget situation, he wants anything he does to be targeted, particularly high bang for the buck, it's just we think this is one that might pass that test.

KING: Let's talk about the broader economy and the global concerns, we've seen what's happened in Greece and across Europe in recent days, and there are some including today that the joint economic hearing when the report was being delivered to the congress, some Republicans saying if you look at our debt to GDP ratio, it's right up there, and if you look at IMF numbers, Italy, Greece, then the United States, 93.6 percent debt to GDP ratio. Could what is happening overseas come home here?

ROMER: No. So, I think the first thing, you do have to be careful with the IMF debt to GDP ratios numbers because they're not -- the statistics that we tend to use are much lower ratios than that, they tend to use gross debts and things of that. I think the bigger point is that, of course, the United States is the most credit worthy country in the world. When the going gets tough, where does all the money come? It comes to the United States because the rest of the world trusts us.

You know, that said, the president is very concerned about the budget deficit and he's absolutely taking concrete steps to make sure we get it under control. I mean, if you think about how he has, you know, thrown his support behind the bipartisan commission, he wants to give that a chance to work.

KING: And you've seen the political conversation about the debt commission, they say it's the president's way of getting some political coverage to have a VAT tax or some kind of tax increase. So, what's on and what's off?

ROMER: The thing he's been careful to say that he's taken nothing off the table because he knows the commissions can only do their job if you give them a broad mandate and let them do their work and so he's been very careful to fight that tendency to want to say, "here's what I want to do." He's going to listen to them, going to give them a broad chance to see what they can come up with. Because the only way this goes forward is if we can get consensus between the two parties, it's a big problem, it takes all of us to solve it.

KING: Let me ask you lastly, if you're a modest investor with a modest 401(k) and you were watching what happened yesterday when almost 1,000 points in a matter of minutes and now there are questions, was it a glitch, was it a bad trade, should the average American consumer with a modest portfolio be at all worried about the markets?

ROMER: You know, I think I'm smart enough not to comment on ups and downs in the market. I think what we can reassure them is that the regulators, the SEC, the Commodities Futures Trading Commission, they're going to be looking into this, figuring out what happens, figuring out if they need more safeguards, that the secretary of the Treasury is going to be watching this very closely. But you know, the whole reason we're doing financial regulatory reform, the whole reason we're having investigations in this, we want a financial system where investors feel safe and that's going to be crucial for them and for the health of the economy.


KING: Always nice to spend some time back at the White House, we thank dr. Romer. When we come back, you're a Betty White fan, right? We'll explain the connection between Betty White's appearance on "Saturday Night Live" and this year's midterm elections.


KING: This is part of the show where every night we introduce you to the most important person you don't know, and if you've been with us for a while on Friday that's you. As part of our commitment to bring you into the conversation, we always read our FaceBook postings, our tweets and the comments sent for our blog.

And every Monday we ask a question and we give you all week to make your case by posting a video on our Web site, This week's question: Has the oil spill in the Gulf of Mexico changed your mind about offshore drilling? Here's a sampling of what you think and a couple of other people added you might recognize.


MICHAEL MARTINEZ, VIEWER: We need to stop drilling; we need to start using renewable energy that isn't hurting our ozone layer.

RICHARD KNUTSON, VIEWER: We need to get more oil from our own country rather than importing all the oil that we get.

SEN MARY LANDRIEU (D), LOUISIANA : We have drilled 1,000 deep water wells in the gulf successfully, 1,000. except for this one. So the fact that we do it 99 -- 999 right and one wrong doesn't mean that you throw up your hands and run in hysteria.

NINO LAROCCA, VIEWER: There's got to be a better way than drilling for oil. This has got to stop, this destruction of our planet is senseless.

GOV ARNOLD SCHWARZENEGGER (R), CALIFORNIA: I see on TV the birds drenched in oil, the fishermen out of work, the massive oil spill, oil slick destroying our precious ecosystem. That will not happen here in California.

VELDA BROWN, VIEWER: We need to use less oil and we need to get out on the road and walk more.


KING: So, I guess this is the question right here, "is oil drilling dead?" It's on the cover of "The Week" this week and with me here is studio to ponder that and other questions, Dana Bash, our senior congressional correspondent, Amy Walter, the editor and chief of "The Hotline."

Is drilling dead?

AMY WALTER, THE HOTLINE: Well, it sure does not look like the kind of thing that you're going to embrace as a candidate, certainly Americans, right now, have a different perspective on "drill, baby drill" idea when "spill, baby, spill" was really the talk of the day. Although a lot of it is regional.

You had Senator Mary Landrieu talking about that she was still in supportive of this. You're going to see this in some other states, Virginia, for example, Governor McDonald coming out and supporting it. And then places like New Jersey, where you do have Republican governor saying, uh-uh, we're not going to touch it.

KING: Before you jump in, I just want to put these numbers up. Here's one quick evidence of some turnaround in the state of Florida. Support or oppose, now 35 percent supported, April 2009, 59 percent supported just in the state of Florida, offshore drilling, opposed 55 now, it was only 28 percent a year ago. DANA BASH, CNN SR CONGRESSIONAL CORRESPONDENT: Exactly, just one year ago, see how that flipped and that's why you talk about how the fact that support for it is diminishing, the Democratic senator from Florida, Bill Nelson, he was kind of a lone wolf in his opposition to this and now, boy are people jumping on the bandwagon up on the hill following these Democrats around and asking them, well you know, how do you feel right now. Because, remember it wasn't that long ago that the president embraced this and it really angered a lot of environmentalists and some people from coastal states and now he's got a lot of support.

KING: Well, let's talk about some other stories on our radar beginning with one that's connected with this. Senators John Kerry and Joe Lieberman will introduce their long-awaited energy and climate change legislation, Wednesday. But they're going to do it missing somebody, without Republican Senator Lindsay Graham.

In a joint statement, Kerry and Lieberman write: "Over the last three weeks, we all understand that Lindsay has been busy with the immigration issue and we understand his feelings fee feeling on that issue. But during this period, we've continued working, moving forward. We believe we've made new progress on the path to 60 votes."

Do they have new math or new progress?

BASH: They have the same progress, actually, that they had before in terms of, actually I should say the same legislation that they had before and that is probably why they could have issues in moving this forward because it was already unclear whether or not they would even get 60 votes, even with Republican Lindsay Graham on board, but the big problem they have, even though this is a climate change bill and it has a lot of specifics on new energy and things like that, it also does call for an expansion of oil drilling and that is why this is going to be in big, big trouble, even before it even starts.

KING: And it has some carbon taxes in it, doesn't it?

BASH: It does have some carbon taxes in it. But you know, the funny thing is that Senator Graham had been working on this with senator Lieberman and Kerry for seven months, seven months, so this is not just like something that they just decided to throw out there now, this is something they had worked on for a very long time and they had hoped that this would be the bipartisan bill and now...

KING: Is it something like immigration, Amy, where a lot of people in the Democratic Party do want to move forward with this, but the six or eight or 10 or 12 vulnerable, more moderate, more conservative from red or purple states, oh, please don't do this to me before the election?

WALTER: We're already hearing so much, especially for House Democrats who voted for this who are seeing that vote, which was then that the cap and trade position was in the original bill, who feel as if they were sort of hung out to dry on this, it's not coming back on the Senate. They have...

KING: House members feel hung out to dry by the Senate? I'm shocked.

WALTER: Isn't that shocking. Which is why it was so surprising when Speaker Pelosi said, you know, we'll deal with immigration, as the Senate deals with it, then we'll take care of it.

KING: All right, here's another great race with a new twist in it. Florida Senate race, a new poll shows Charlie Crist did the right thing at least in the short-term, if you believe the polls, by dropping out of the Republican primary and going it alone. This is in a Mason-Dixon poll, has Crist leading a three-way contest, Republican Marco Rubio, Democrat Kendrick Meek runs third, there, so, for the time being, he looks all right.

BASH: Right time being.

WALTER: Very much for the time being, the pollster who did this poll actually said that this is really a house of cards right here for Crist because that 38 percent is built on very strong support, from Democratic he's getting something like 55 percent of the Democrat vote. And that's not because they don't like Kendrick Meek, they just have no idea who Kendrick Meek is. he hasn't spend a dime, really, on TV, yet. Everybody knows who their governor is, that support is going to slip as we get closer and closer to Election Day and the big problem for Crist then is -- he doesn't need to win all, he needs just 55 percent, but he needs to get enough Republicans and Independents; and those Republicans are not coming back to (INAUDIBLE) Crist.

KING: All right, here we go, "Saturday Night Live" fan, I know, I know, I know it's sometimes on when you're asleep, still.

"Saturday Night Live" fan?

WALTER: Yes, but TiVo.

KING: TiVo? Oh, come on, stay up this weekend, a little bit more pop culture than political, until you remember this is a case of pure Democracy in action. Thanks to a grassroots effort of her fans on FaceBook, 88-year-old Betty White will host this weekend's "Saturday Night Live."


BETTY WHITE, ACTRESS: Hi, I'm Betty White and I'm hosting "Saturday Night Live" this week with musical guest Jay-Z.

UNIDENTIFIED FEMALE: Is this something you dreamed out when you were a little girl?

WHITE: I was 63 when "Saturday Night Live" went on.




BASH: Isn't that amazing?

WALTER: I just love Betty White.

BASH: No, exactly and that is the best part about this is that is was a grassroots campaign. But you know, Betty White is really salty, I mean, she's 88 so really is disarming when she sort of gets down and dirty, but she does get down and dirty. Another thing that I saw as I was watching the promos online is that she did say that's going to do a skit or two with Jay-Z, so that's...

WALTER: Listen, if we don't have Tina Fey, we can at least have Betty White. Will, she do Palin impersonation?

BASH: Well, Tina Fey's going to be on with her, actually.


KING: How about a Beyonce impersonation?

WALTER: It's going to be a Mother's Day special.

BASH: Oh, a Beyonce...

KING: Beyonce impersonation, that's my vote.

BASH: Maybe she'll do a "Put a Ring on it" video.

KING: "Put a Ring on it,"

WALTER: We're the source of ideas for "Saturday Night Live."

KING: Eight-eight year young, Lorne Michael, I hope you're listening, I suspect you're working on the skits. All right, Amy, Dana, thanks.

Coming up, it's a very special day for our good friend, your good friend, Wolf Blitzer, we'll tell you why, next.

And in the wake of Wall Street cratering yesterday, we sent the best investigative guy you can do, off-beat reporter, Pete Dominick, for the big question.


PETE DOMINICK, CNN NEWS CORRESPONDENT: where do you put your money, stock market or the piggy bank.


DOMINICK: Piggy bank. Guess what? It's safer there.


ANNOUNCER: Here comes the "Play-by-Play."

KING: All right, a little Friday night "Play-by-Play," you get the drill, just like in the sports shows, we got the day's best tape, we break it down. And we've got the best right here to help us do that, Republican Ed Goeas is still with us, Paul Begala coming back, our Democrat.

I want to go back to an issue we talked about a little bit about at the top of the show and it's the president's message, the tough balance he has to strike on the economy. Let's start first with a little bit of the president, today.


BARACK OBAMA (D), UNITED STATES PRESIDENT: And we've got to be mindful that today's job numbers, while welcome, leave us with a lot of work to do.


KING: "Leave us with a lot of work to do." Remember those words, because now we're going to show the president -- we're going to go back now, no today, but back to sever statements over the course of the past year plus.


OBAMA: You're here and I'm here because we have got more work to do. There's still the work to do to rebuild this economy.

We know there's far more work to do.

We've got a lot of work to do.

We've still got a lot of work to do.


KING: I'm a little slow sometimes, but I think we have got a lot of work to do.


What's the challenge there when to the point earlier about how much politics is the leading indicator -- the economy is the leading indicator of our politics and it's almost like a treading water message?

PAUL BEGALA, DEMOCRATIC STRATEGIST: Well, yes, you have to strike that right balance, so you don't want to be so pessimistic, or you talk the economy down. If you're too optimistic then you look like you're out of touch. He's trying to be realistic. But, when I see a politician, our president, especially, with that kind of message (INAUDIBLE) music to my ears. I remember a wire guy, back when King went to wire report (INAUDIBLE), I was complaining to you because you wouldn't write again and again what Bill Clinton was saying every day with the message, discipline (INAUDIBLE)...

KING: Bill Clinton enforcing message discipline. BEGALA: And you wrote on your pad -- you may not remember this -- you wrote "news" and then you covered up the "s" and you said if it's not new, it is not news. That was one of the John King journalism lessons that you taught me.

KING: Let's skip John King journalism lessons. Ed if you were advising this president, is a very tough challenge on the economy.

ED GOEAS, THE TARRANCE GROUP: Well, what Paul says is exactly right. I mean, you have to be able to be optimistic about what's going to happen, but you also have to not look like you're being fake in terms of that optimism, however watching this, I kind of wonder if wasn't he just made the teleprompter operator angry.


KING: So here is another question. It's 15 months into the administration -- I want to show you some pictures of the economic team walking out today with the president. You see them there, Secretary Geithner, Secretary Locke, Peter Orszag, the budget director, Larry Summers, Dr. Romer, there you see the economic team. Now let's take a different view of this. We've got another picture here.

We're 15 months in. I'm going to wander over here for a second. Here's -- when you talk to people in the White House, they tell you Peter is starting to look for his way out. Dr. Romer is thinking, "when is it right for me to leave, not just yet." Larry Summers also thinking, "OK, I've served in the Clinton administration, how long am I going to stay."

Paul, 15 months and that's not unusual, people start to get burned out, especially a new administration, the high octane start that you had, but when you have two or three members of the economic team thinking "when is it right for me to go," who referees that?

BEGALA: Well, the president, the chief of staff, but also, Larry Summers on the far left, there's he is the chairman of the National Economic Council...

KING: He'd love to know you called him on the far left.


BEGALA: Of that picture. But that job was created by President Clinton to try to be the quarterback that handles all of this. But it is true that the average tenure of a senior White House aide is 18 months. It's a killer job. Some people, Andy Cardin, the last White House can make it for years and years, but those are really special and rare. Most of us can't last more than about 18 months to two years.

KING: So, the turnover will come a little before and some after the election this summer, will you say?

GOEAS: I think you're going see most of them stay until the election, because any leaving at this point may send the wrong message in terms of where they think the economy is going.

KING: OK, two guys that spent a lot of time crafting a message, wordsmiths, with me here, I'm going to play an ad that is causing a lot of controversy. This is an ad being run against the Bill Halter, lieutenant governor of Arkansas, is challenging a sitting Democratic incumbent Senate, Blanche Lincoln. This is being run by a Virginia group supporting Blanche Lincoln. But...


UNIDENTIFIED MALE: Thank you, Bill Halter, thank you.


Bill Halter off-shored American jobs to Bangalore, India while our economy struggled.


ANNOUNCER: While millionaire Bill Halter was a highly paid director of a U.S. Company, they exported American jobs to Bangalore, India.

UNIDENTIFIED MALE: Bangalore needs many, many jobs. Thank you, Bill Halter.



Support job creation here. Don't send jobs overseas.

ANNOUNCER: With almost 65,000 Arkansans out of work, we need jobs too.

UNIDENTIFIED FEMALE: Thank you, thank you Bill Halter.


KING: All right, we can stop it there, you get the picture, here. Neera Tanden, who works at the Center for American Progress, a John Podesta think tank in town, she wrote this is outsourced racism. The chairman of the Democratic National Committee, Governor Tim Kaine today said, "Pull this ad, please. It's got to go. The tone is horrible."

BEGALA: Well, what if -- what if jobs had been outsourced to Ireland and somebody an ad showing a bunch of drunks in a pub. My Irish mother, by the way, happy Mother's Day, my Irish mother would be outraged and she should be. Any of those sorts of stereotypes are out of bounds. This is a -- by the way, it's a conservative group, they're called Americans for Job Security...


KING: Also, they did have an operation in Bangalore, but the AP looked into it and said you cannot make a connection that American jobs went there. They did have an operation in Bangalore, but they can't say the jobs went there. But, just the tone of it, is that the tone you want in our politics, right now?

GOEAS: Well, what is interesting, you see this happening in the primaries, is that good spots against a Democrat or good Democratic spots against a Republican, when you get in the primaries, you see those same spots against each other. And this is the type of spot that we've seen run against Republicans in the last couple of election cycles, and nothing was said about it. So, it is kind of interesting that now they're kind of eyeing it.

KING: Time out, I'm not going to let you rebut him. I'll bring you back to rebut another time. but, there's one thing I must get in here, that is a tribute to my friend -- 20 years at CNN.



I'm Wolf Blitzer.

I'm Wolf Blitzer.


KING: All right, let's stop this here, because I want to play one moment and Paul won't like that I play this moment. But this -- I worked with Wolf at the White House for several years. I came in as what I called myself the junior White House correspondent. I want you to -- look, this is one moment you won't see Wolf, but you'll see President Clinton.


BILL CLINTON, FMR U.S. PRESIDENT: I did not have sexual relations with that woman.


KING: Now at the other end of that stare and the finger was Wolf Blitzer. He was in the pool that day in that room. I was down in the White House booth, and I remember that day like it was yesterday. And we were trembling about the whole idea that oh my god, the president of the United States is in the middle of this. What does it mean for us? What does it mean for the things we say on television? You remember this days.

BEGALA: I was in that room. I worked hard for 10 years to forget that day.

KING: I was proud to work with a guy who amid all the stuff that was going on, the rumors and everything else, was a damn good solid reporter.

BEGALA: Always been straight down through the middle. That was a time of madness. It was witch-hunts. I mean it was crazy. And Wolf was a complete pro, he was. To this day, I will say, he covered us when I worked in the White House and I worked with him at CNN, you pay me $100, I couldn't tell you how he votes. He's that -- even in private, he's that careful and professional about his fairness. And that's all you can ask of a journalist.

KING: Quick.

GOEAS: I use this as an example to Republicans that when there's a story out there, don't try to be a part of the story, take a step back and let the reporters report. And unfortunately they didn't follow the advice, in this case and many other cases.

KING: Ed Goeas, Paul Begala, thanks for coming in on a Friday night.

Up next, how did survive a wild week on Wall Street? Our offbeat reporter, Pete Dominick, he is checking this out.


KING: A little fun to close out a Friday night. Our offbeat reporter, Pete Dominick, standing by in New York, and does he have a surprise for you -- Pete.

DOMINICK: Well, yeah, John, originally we were going to talk what happened on Wall Street and what I bumped into.

MICHAEL RICHARDS, ACTOR: Hi, John, Mr. King. How are you?

KING: Hi, Michael. How are you?

RICHARDS: I can't hear you.

DOMINICK: He said, "how are you?"

RICHARDS: Hello. Hi.

DOMINICK: He wants to know what you're doing out here on our street.

RICHARDS: Your street?

DOMINICK: This is "Pete on the Street."

RICHARDS: This is my street too.

DOMINICK: No, it's not, it is mine. This is my piece.

RICHARDS: Well, I'm not going to fight you over that.

DOMINICK: Listen, you're a tough man.

RICHARDS: No, no, you yield. It's your street.

DOMINICK: You're yielding. RICHARDS: I'm just passing through on my way to Amarillo.

DOMINICK: You're a rich guy. How much money did you lose in that Wall Street...

RICHARDS: Oh, no, no, I don't play the market.

DOMINICK: You don't?

RICHARDS: No. I don't plunge.

DOMINICK: What do you do with all you're money? It's in a mattress?

RICHARDS: I keep it in a shoe box.

DOMINICK: You put all your cash in a shoe box.


DOMINICK: Really? He is telling me to use the microphone.

RICHARDS: Oh, the microphone, yeah, you're a professional.

DOMINICK: What have you been doing with your time lately? If not spending all that dough?

RICHARDS: No, I just walk around talking to people like you.

DOMINICK: Thank you so much, Michael Richards. Are you concerned about what is happening on Wall Street? Of course you are.

RICHARDS: Indeed, indeed, indeed.

DOMINICK: You made your money legitimately as an artist, an actor...

RICHARDS: Well, they do too. They made money legitimately. Everybody's legitimate.

KING: I would put you guys on a show. I would call it the "Marriage Ref," but I think that's taken.

DOMINICK: No, no, we can't do the "Marriage Ref" that show is already taken. You're not a married man, are you?

RICHARDS: I'm always married.

DOMINICK: You're always married.

RICHARDS: I had to think about that.

KING: How is that a trick question?


DOMINICK: I don't know...

Ladies and gentlemen, Michael Richards right here on Pete's street. John King, what do you think?

KING: I thank you for the special surprise on a Friday night. I'm a huge fan of Michael Richards and Pete Dominick.

DOMINICK: Not bad.

KING: Gentlemen, have a great weekend. That's all the time we have, tonight. Candy Crowley is standing by in New York, she's filling in for Campbell Brown. You have a great weekend. We'll see you right back here on Monday.