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McCain Lays Out New Economic Proposals; Stocks Retreat

Aired October 14, 2008 - 22:00   ET


ANDERSON COOPER, CNN ANCHOR: Tonight, breaking news: global reaction to an uncertain day on Wall Street, investors weighing in on the administration's new plan to sink a quarter-trillion dollars into failing banks, markets in Asia down slightly right now, for the most part.
Today, on Wall Street, a roller coaster, the Dow industrials up 400 points early on, then down 200 later, winding up around -- down around 76 or so points, the Nasdaq plunging a lot deeper, losing 65, or more than 3.5 percent for the day.

We will have more on the economic plan announced today, but, first, the race for the White House intensifying -- John McCain laying out new economic proposals today. Barack Obama did the same yesterday. We're now on the eve of the presidential debate, and John McCain is vowing to fight hard to the end.

And a fight, it will be -- the latest CNN poll of polls showing Senator Obama out ahead of Senator McCain by eight percentage points.

As always, a reminder: Numbers can change, sometimes a lot, even this late in the game. But, as you will see, game-changers get fewer with each passing day.

The "Raw Politics" tonight from Candy Crowley.


CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT (voice-over): Trying to get on top of an issue that has crushed his campaign, John McCain rolled out a $52.5 billion economic plan.

SEN. JOHN MCCAIN (R-AZ), PRESIDENTIAL NOMINEE: If I'm elected president, I will help to create jobs for Americans in the most effective way a president can do this, with tax cuts that are directed specifically to create jobs...


MCCAIN: ... to create jobs and protect your life savings.

CROWLEY: McCain's new initiatives would eliminate taxes for workers drawing unemployment, allow individual investors to write off up to $15,000 in stock losses, and cut the capital gains tax on stock profits. There was, as well, tax relief for one of McCain's most loyal voting blocs, the over-60 crowd. MCCAIN: Under the emergency measure I propose, we will also cut the tax rate for withdrawals from tax-preferred retirement accounts to 10 percent. Retirees have suffered enough and need relief.

And the surest...


MCCAIN: And the surest relief is to let them keep more of their own savings.

CROWLEY: The Democratic ticket spent the day double-teaming Ohio and McCain. Obama, camped out in that critical state for debate prep, said he doesn't know much about McCain's latest proposals, but hasn't liked what he's seen so far.

SEN. BARACK OBAMA (D-IL), PRESIDENTIAL NOMINEE: There's some ideas that Senator McCain has put forward in the last couple of weeks that are very bad ideas.

CROWLEY: It is the kind of coolly critical analysis Obama has made into an art form in presidential debates. His main goals Wednesday night remain: Look presidential. Don't rock the boat.

Joe Biden does the rocking.

SEN. JOSEPH BIDEN (D-DE), VICE PRESIDENTIAL NOMINEE: The distinction could not be clearer. One guy is fighting for you, and the other guy is fighting mad...


BIDEN: ... and attacking.

CROWLEY: For John McCain, the third and final debate is his last, best shot at a huge audience of voters, many of whom have not been impressed with McCain raising the issue of Obama's relationship with '60s radical William Ayers, who founded a group linked to several bombings in the Vietnam era.

McCain did not mention Ayers in his last debate. Some conservatives are urging him to bring it to Obama this time. It's risky. It might hearten those who think McCain hasn't gone hard enough. It may likely turn off independents, who increasingly seem to be turning to Obama.


COOPER: Candy, we have been focusing the last couple days on, you know, the rhetoric that we're hearing, particularly from the McCain-Palin camp on the trail. Has the pendulum swung? I mean, where are they in terms of -- at a John McCain speech, how much do you hear now about the economy? How much do you hear personal about Barack Obama?

CROWLEY: Well, today has been very much on the economy. What McCain has done, yesterday in his speech, also on the economy, and today, is look at the issues and say, you know, Barack Obama says that he's going to cut your taxes, but he's got a record of tax hikes.

So, this is really a risk you're taking here. He had a line saying, you know, it's a -- never have so many gone on so little, meaning you don't know this guy.

COOPER: Right.

CROWLEY: So, he's taken it to him, but on a sort of a policy level, trying to make the same point: He's not experienced enough to lead this economy.

COOPER: And he's risky.

CROWLEY: And he's risky. Yes, he doesn't use that word, but it's very much: I have been there. I'm the fighter. I understand pain. You understand pain, sort of trying to connect with the audience, and disconnect, if you will, Barack Obama.

COOPER: Interesting.

Candy Crowley, thanks, on the trail tonight.

As for bringing up Bill Ayers, on a radio interview today at station KMOX in Saint Louis, Senator McCain virtually guaranteed it, although he suggested it would be the moderator of the debate tomorrow night who brings it up.



MARK REARDON, RADIO TALK SHOW HOST: Many of your supporters are eager for you to confront Senator Obama on the Bill Ayers relationship, in particular.


REARDON: Hillary Clinton even brought this up during the primary. Senator Obama says that you should have the guts to do it in person.

So, will you?

MCCAIN: Oh, yes.

You know, I was astonished to hear him say that he was surprised for me to have the guts to do that, because the fact is that the question did not come up in that fashion. So, you know -- and I think he's probably ensured that it will come up this time.


COOPER: McCain moving from defense to offense.

The question is, will it work? And what does Obama need to do to keep the lead?

Let's strategy with CNN political analyst and former presidential adviser David Gergen, Republican consultant, former Romney campaign adviser and McCain supporter Alex Castellanos, and CNN political analyst and radio talk show host Roland Martin, who is also an Obama supporter.

So, David, it seems like McCain is still using sort of a kitchen- sink strategy, a little Ayers from Palin, ACORN, underdog, experience. Does he have to be careful tomorrow night about going after Obama too strongly, or should the gloves come off?

DAVID GERGEN, CNN SENIOR POLITICAL ANALYST: Well, this is his last opportunity, his last big opportunity, Anderson.

I think it's going to be a major strategic choice. "The New York Times"/CBS just has a poll out tonight saying that a growing number of voters perceive him as being far more on the attack than offering specific solutions, and that's hurting him. In their poll, they have Obama up by double digits now.

So, there is some evidence that these attacks are hurting him. I thought, today, Senator McCain did exactly the right thing. And that was to give us a serious speech, with specifics, about what he would do in this -- during this economic crisis. And that was a good prelude to the debate. It set him up. He put up some proposals out there that he won't be throwing on the table in the first time, as he did the last time, the last debate, when he came up with that mortgage idea that came out of nowhere.

I think his problem is -- and just briefly -- you know, when the federal government is tossing around numbers like a $700 billion bailout plan, $250 billion going immediately into recapitalizing the banks, and he comes up with a $50 billion plan, Obama comes up with a $60 billion plan, in this wacky world we're now in, it doesn't sound like very much, does it?


COOPER: Yes, in the perspective, I guess.


COOPER: Alex, if the idea, though, is to win independents, is Bill Ayers the way to do it tomorrow night?

ALEX CASTELLANOS, CNN POLITICAL CONTRIBUTOR: No, it -- I don't think that's exactly the way to go.

Both of these candidates have been out on the campaign trail so long, Anderson. This campaign has been longer than train smoke.

(LAUGHTER) CASTELLANOS: And they have gotten to know these candidates. There's thousands of ads in these states. They have had these candidates in their living room, voters have, now for two debates.

To come up and say, you know, you really don't know Barack Obama, there's a secret Barack Obama, that's -- I think that is going to be hard for voters to take.

Instead, I think Senator McCain is rightly going to talk and say, not that you don't know Barack Obama, but you do. He said he's going to tax, he's going to spend. What happens if Democrats in Washington and a Democratic president get together and spend and tax, without restraint, with no one there to stop them, with no adult supervision?

Make a case that is relevant to voters. And talk about risk that way, but don't talk about risk, you know, Barack Obama 20 years ago.


COOPER: But, Roland, Obama has not been exactly clear on his relationship with this guy, Ayers. Whether it's important or not, it's certainly going to be brought up. First, he said, it was a guy in my neighborhood. He sat on a board with him. Then, it was, you know, I didn't -- I didn't know his past when I met him, or I was only 8 when he was setting bombs.

Do you think he's vulnerable on this?

ROLAND MARTIN, CNN CONTRIBUTOR: No, because here's why.

The people who are most vulnerable are those people who don't have jobs, who can't afford gas, who can't buy food, who can't get milk, who don't know how to send their kids to college. I was at Fayetteville State University tonight, Anderson.

COOPER: So, you're saying, people don't care, independents don't care about this Ayers stuff?


Anderson, I was at Fayetteville State University tonight debating Michael Steele on this issue. And he said, we think it's going to come up. He said, but it's mistake. People are caring about pocketbook issues. And you can throw all kind of extraneous stuff out. The bottom line is, they want to know how they're going to survive the next day.

If McCain sticks to the economy, and says how I can be a leader on these issues, he scores more points. He goes there, now he's off message and now all we're talking about the next day is his attack Obama and Ayers, you're giving Obama a shot to hit you back by saying, that's old politics. It's a bad move.

COOPER: You know, it's interesting, David. I heard from some Democrats I was talking to today who kind of feel like, you know what, it's over, game over. The polls are up. But, if you look eight years ago, Al Gore led George W. Bush by 11 points. We all know how -- how that thing turned out. Does John McCain still -- I mean, when he talks about coming from behind, and we have them where we want them, does he maybe have a point?


GERGEN: Well, it's rare, but you can come from behind this way.

Karen Hughes just pointed out on "LARRY KING" that Ronald Reagan was double digits back of Jimmy Carter heading into late October. There was one final debate. There was one debate. He won that debate, and he swept in.

And Al Gore, you know, did come from way behind in the last 10 days and actually got the majority of the popular vote. I think it's still possible to do that, especially -- if he can close that lead down to three or four points, anything can happen Election Day.

I actually think Alex is on to a more promising -- rather than going after Bill Ayers, the point that Alex makes about raising the question about an Obama administration working with Pelosi and Reid, is that what Americans want, you know, just in the last 48 hours, Obama's been talking about a $150 billion stimulus package.

And, in Congress, they're saying, we would like to double that. The Democrats are saying, right after the election, we would like to go to $300 billion.

I don't know where all this money is going to come from. I don't know what kind of deficits we're rolling out. But I think that Alex is right. That is a more promising line of attack than the Bill Ayers stuff, which I don't think is cutting it at all.

COOPER: Well...

MARTIN: Anderson, any Democrat who is saying what you just said is an absolute idiot.

You don't sit here and say, 21 days out, somehow, the race is over. No. You should be saying, no, you dig deeper. You get your people out.

Republicans are doing the exact same thing. If the Democrats are sitting back, saying, hey, we have got this won, you know what, and they lose, they deserve to, because they're going to be stupid to do so.

COOPER: We are going to have more with our panel ahead.

If you're -- we're certainly interested in what you have got to say. Join the conversation, I'm about to log on my -- actually, I have already logged on myself. Be sure to check out, also, Erica Hill's live Webcast during the break. That has already started. That's at, as well. Up next: The candidates making a lot of promises in their new economic plans, but can they actually deliver? As David just said, where is all this money coming from? We're "Keeping Them Honest" -- what they will do for you and what they will cost you.

Later, we go on the trail with Sarah Palin, pumping up the attacks on Obama's patriotism.


GOV. SARAH PALIN (R-AK), VICE PRESIDENTIAL NOMINEE: Our opponent gives speech after speech about the wars that America is fighting. And, just once, it sure would be nice if he would just once say he wants America to win.



COOPER: And naming names: the fifth man in our list, the 10 most wanted culprits of the collapse. Who joins the list tonight? Well, here's a hint. Once upon a time, he was seen as an economic hero.



MCCAIN: He's an eloquent speaker, but even he can't turn a record of supporting higher taxes into a credible promise to cut taxes.

What he promises today is the opposite of what he has done his entire career. Perhaps never in history have the American people been asked to risk so much based on so little.

OBAMA: There are some ideas that Senator McCain has put forward in the last couple of weeks that are very bad ideas. The idea, for example, of purchasing homes at full price from banks, so that banks have no losses, and taxpayers automatically have losses, that is a bad idea.


COOPER: The first round of economic trash talk from the candidates, Senator McCain in Pennsylvania, Obama in Ohio.

They know the election is all about the economy. We have been talking about that for weeks now -- this week, both unveiling some new plans to try to save it, McCain rolling out his vision today. But is either man really being truthful about how effective their plans can be?

Where's all this money coming from?

360's Joe Johns tonight "Keeping Them Honest."


JOE JOHNS, CNN SENIOR CORRESPONDENT (voice-over): They have two drastically different recipes for recovery. And both candidates would have you believe theirs is the right one.

MCCAIN: I will help to create jobs for Americans in the most effective way a president can do this, with tax cuts that are directed specifically to create jobs.


OBAMA: It's a plan that begins with one word that's on everybody's mind. And it's easy to spell: J-O-B-S, jobs.


JOHNS (on camera): But only one of these guys really gets to tackle this financial mess, and you have got to choose between them.

(voice-over): So, "Keeping Them Honest," instead of asking the candidates, we went to Roberton Williams, this really smart guy who looks the part, to give us the goods. Hint: Williams isn't all that impressed with either plan.

ROBERTON WILLIAMS, PRINCIPAL RESEARCH ASSOCIATE, TAX POLICY CENTER: It's not clear that many of these things will do more than be panaceas, emotional panaceas at that. It's certainly not something that will get us out of our current bind.

JOHNS: The Obama plan calls for a 90-day moratorium on foreclosures, government loans to help states and cities, penalty-free withdrawals from IRAs and 401(k)s, $3,000 refundable tax credits for each new job a company creates. But that only goes so far.

WILLIAMS: Three thousand dollars will not induce very many companies to hire new people in today's economy. Those companies that are doing really well and would hire them anyway will benefit from $3,000 in free money. Those who are not hiring will not hire for a $3,000 bonus.

JOHNS: The McCain plan calls for breaks for senior citizens tapping their retirement accounts, accelerated write-offs for people forced to sell their homes at a loss, reductions on capital gains taxes the next two years, and eliminating taxes on unemployment benefits, which Obama has also called for.

Williams says that last idea makes pretty good sense. But here's the problems with both plans. The candidates have not told us how their programs will be paid for. Williams says, the worst idea he's heard was proposed by both candidates, encouraging people to draw down their retirement accounts with reduced penalties at the wrong time.

WILLIAMS: This may induce people who shouldn't be withdrawing money from their accounts to withdraw money from their accounts, when they probably shouldn't be withdrawing it. JOHNS: Which takes us back to the original point. Both candidates say we need to create jobs. But Williams is skeptical that their plans will do much of that.

Joe Johns, CNN, Washington.


COOPER: Well, the attacks continue, meantime, Joe Biden and Sarah Palin also taking their shots.


PALIN: In times like these, the last thing we need is a tax increase. And America just can't afford another big-spender in the White House.



COOPER: Up next, see what happened when 360's Gary Tuchman tried to talk with Sarah Palin on the trail.

And striking new developments in the case of missing Caylee Anthony. Her mom, her mysterious mom, gets charged, but are police any closer in actually finding little Caylee?

Join us at right now. Join the conversation.

We will be back here in a moment.



BIDEN: At the end of the day, there's a fundamental difference between Barack Obama and John McCain, and Joe Biden and Sarah Palin. And it's literally this basic, in my view.


BIDEN: It's what...


BIDEN: ... what...



BIDEN: Maybe I should stop here.

(END VIDEO CLIP) COOPER: Senator Joe Biden in Warren, Ohio, today breaking up after a guy yelled out "brains" as the fundamental difference between the two tickets.

On Thursday, we're going to turn our cameras on the crowds at a Biden rally, just as we did yesterday at a Sarah Palin rally in Virginia. Palin gave an interview to Rush Limbaugh today, saying, the media wants her to be silent, which is an Interesting perspective, given our frequent offers to interview her.

We will let you hear what Palin had to say to Limbaugh in a moment.

But, first, Gary Tuchman, on the trail, caught up with Sarah Palin in Biden's hometown of Scranton today. well, at least he tried to catch up with her.

Take a look.


GARY TUCHMAN, CNN NATIONAL CORRESPONDENT (voice-over): When a political candidate doesn't want to talk to a reporter, she or he usually offers a polite wave and moves on.

(on camera): Governor, can you come to the microphone?

(voice-over): But no at all reaction from Sarah Palin. Three weeks before Election Day, she keeps away from almost any unpredictable interview situation. She prefers the predictable, like a radio interview with Rush Limbaugh.


RUSH LIMBAUGH, RADIO TALK SHOW HOST: Our pleasure to speak with you.

PALIN: Hey, thank you so much. And dittos from Scranton.


RUSH: Scranton, Pennsylvania, on the bus?

PALIN: We just got off the bus. We're heading into a rally here, but wanted to take a couple of minutes to get to say hi and let you know what we're doing, Rush.


TUCHMAN: Here's what she was doing.

CROWD: Sarah! Sarah! Sarah!

TUCHMAN: Speaking at a rally in Democratic vice presidential nominee Joe Biden's birthplace, Scranton, Pennsylvania.

PALIN: Thank you so much for that warm welcome to Scranton.

TUCHMAN: A rally where Joe Biden got bigger boos than Barack Obama.

PALIN: Joe Biden had said that there's no such thing as clean coal when we talk about clean coal technology that is needed.


TUCHMAN: The Obama/Biden campaign says, Palin is misrepresenting Biden's views on clean coal. But, among this crowd, Biden had no home field advantage and no mercy.

(on camera): Joe Biden is from Scranton. Does anybody like Joe Biden?

UNIDENTIFIED MALE: Absolutely not.

UNIDENTIFIED MALE: Ten years old when he left Scranton. These people have lived here all their lives.

TUCHMAN: There were many people here who are angry.

UNIDENTIFIED MALE: I have sort of turned myself off from the liberal media, and I think everybody else has. From people I have been talking to, they have turned the liberal media off. So, that's right, sticking to the Republicans, staying conservative. And go -- God bless America.

TUCHMAN: The candidates on the podium, angry, too.

PALIN: Now, all across America, there's a lot of anger, a lot of frustration, anger about the insider dealing of lobbyists and anger at the greed and the corruption of Wall Street, anger about the arrogance of the Washington elite, and anger about the unconscionable voter fraud going on in this state and elsewhere.


TUCHMAN: Before Sarah Palin flew out of the critical state of Pennsylvania, we gave it one more go.

(on camera): Governor, can you come to the microphone, Governor?

(voice-over): And, once again, she made the decision not to talk to us. But, this time, we did get a wave.


COOPER: Well, at least you got a wave there, Gary Tuchman.


TUCHMAN: That's right.

COOPER: How could anyone not want to talk to you? (LAUGHTER)

COOPER: It's interesting. Last week, we saw Sarah Palin really, you know, going after Bill Ayers, going after these personal issues. Is she still doing it this week, or has she backed off it?

TUCHMAN: The attacks this week not nearly as personal, some attacks, but mostly applause lines.

These crowds, Anderson, are exuberant.


TUCHMAN: They have been very exuberant. But she is preaching to the choir.

Most of these voters are not going to vote for Barack Obama anyway. So, she's done so many interviews as governor of Alaska. And she's been all over the place talking to people as governor. It wouldn't surprise me to see the McCain campaign shake things up and let her talk to reporters, so she can get more independent and Democratic votes.

And I will tell you, this past weekend, I was at my high school reunion, 30th reunion, by the way. And lots of people wanted to talk politics. And I guess I shouldn't be surprised that more people wanted to talk to me about Sarah Palin than Barack Obama and John McCain combined.

COOPER: Interesting.

All right, Gary Tuchman, thanks.

More on what Sarah Palin had to say to Rush Limbaugh today, and a surprising statement from Hillary Clinton about her ambitions for higher office.

We will also take you to fire lines in California for a late update, as thousands of acres continue to burn.

And more on the market's wild ride, and how global markets are moving right now.

And we reveal another member of the 10 most wanted culprits of the collapse, naming names, so you know who, the folks and their faces behind the fiasco -- tonight, a new name.

Stay tuned.



MCCAIN: America is worth fighting for.

(CHEERING AND APPLAUSE) MCCAIN: Nothing is inevitable. We never give up. We never quit. We never hide from history. We make history.

Now, let's go win this election and get this country moving again.



COOPER: Never give up, never quit, playing up the underdog them, John McCain today in the battleground state of Pennsylvania.

Governor Sarah Palin was also in that state today. And, as we mentioned, during a break between campaign stops, she was interviewed by Rush Limbaugh.

The conservative radio host asked Sarah Palin about the media. Listen.


LIMBAUGH: This is an attempt to get you to shut up.


RUSH: This is an attempt by the media to make you stop being who you are. What it means is, they're really worried about the effectiveness that you have.

PALIN: Well, yes, I guess that message is, they do want me to sit down and shut up. But that's not going to happen. I care too much about this great country.

Now, yes, speaking of some of those associations -- and you're right -- mainstream media is not holding Barack Obama accountable.


COOPER: Well, Palin wasn't the only one talking. So was Senator Hillary Clinton, making news by saying she doesn't want to be on the Supreme Court in the future.

With us again, CNN senior political analyst and former presidential adviser David Gergen, Republican consultant, former Romney campaign adviser and McCain supporter Alex Castellanos, and CNN political analyst and radio talk show host Roland Martin, who is also an Obama supporter.

Roland, were you surprised to hear Sarah Palin saying that the media is trying to shut her up?

MARTIN: Oh, please. Give me a break.

(LAUGHTER) MARTIN: You know, I have got a column on tomorrow saying, you know what, Sarah Palin? If you're a real frontier woman, you know, the woman who totes a gun, and you are sitting there spitting fire, taking down moose, surely, you can talk to us, you know, coddled, elite journalists who want to ask you the tough questions.

This is ridiculous. She wants to be in a safe zone, talking to the usual folks, like Sean "Little Ball of Hate" Hannity and Rush Limbaugh. But the fact of the matter is, she doesn't want to answer any tough questions. She doesn't want to answer anything about her husband belonging to a party where the founder said, you know, I want to secede from the United States.

She doesn't want to talk -- she doesn't want to talk about this whole issue of this abuse of power, where she says she was completely cleared. No. She wants to talk to the American people who don't talk back. That's what she wants.

COOPER: Alex, it's interesting. It's interesting. You had this -- Bill Kristol just the other day writing that they should free Sarah Palin and free John McCain, and open it up to the media, and let them interact on a daily basis.

Do you think -- do you expect to see her being freed at any point?

CASTELLANOS: No. Both of these campaigns right now are very scripted and very on message, especially with their vice presidential choices.

But, you know, there's a reason that Biden isn't making that many mistakes. He's toeing the Obama line. They've got a lead. They're trying to sit on it and make no mistakes.

I doubt you're going to see anything different from the McCain campaign with Sarah Palin. Now, she has done something for the McCain campaign that the McCain campaign couldn't do for itself. She actually lifted that campaign a few weeks ago, gave it a message: change Washington. If we change Washington, this country can renew its strength and its confidence again. And that resonated.

She can be useful in doing that again out there on the campaign trail. This country is very mad at Washington, even on the edge of an economic precipice last week. Americans understood how serious it was. And they didn't trust Washington with $700 billion. They said, don't do it. That's that wave of anger out there, and Sarah Palin can help galvanize that.

COOPER: David, Sarah Palin talked about ACORN, which was basically doing some phony voter Registration. Do you think that's an issue which resonates on the campaign trail? I mean, it certainly seems to resonate with people in the crowd that she is talking to.

GERGEN: That's exactly right, Anderson. It does resonate. Today, she got the biggest hand on that in her crowds. And so it's working among the conservatives.

COOPER: It's actually not voter fraud. She keeps saying it's voter fraud. It's not voter fraud. Voter fraud is someone voting fraudulently. This is just...

GERGEN: Well, it's Registration fraud.

COOPER: Registration fraud.

GERGEN: It's bringing in names. And you know, the "Washington Journal," lead editorial today, is about ACORN, now about the rescue plan, about Hank Paulson, so it is resonating in conservative circles.

I don't think it's much of an issue. I think it's even less important right now than Bill Ayers to most voters. But if you can find -- the big story is up in Nevada where they found evidence of fraud and voter Registration. But this is not part -- an official part of the Obama campaign.

Obama pointed out today, "You know, look, I've been running voter Registration for -- with my campaign for months and months and months now. We've Registered tons of people." I was just in North Carolina, where Roland is tonight. This morning, 610,000 people have been Registered in North Carolina, three times as much as they've ever had before, a lot young and minorities. That's what's helping to change his campaign.

ACORN has been a sideshow to that. Can he get a little fodder out of it? Yes. But nowhere near as important.

MARTIN: Anderson, here's the thing...

CASTELLANOS: The other thing that's happening, too, is that I think David's exactly right. This pleases the base and goes over great at a rally. But the campaigns that had the most intense rallies and most energetic supporters in American history have been McGovern and Goldwater. They fired up the base and lost. You've got to do more than that in a race.

MARTIN: Anderson, I don't understand why she's so scared of CNN. I mean, talk to Wolf or Anderson or Campbell. I mean -- but again, though, I understand this whole controlled setting. But if you're trying to get a broader message out, you can't -- as Alex said, you just can't talk to the base. You've got to pull the independents. So stop being scared, Sarah.

COOPER: Very briefly a final question. We talked about what McCain has to do in the coming weeks. What do you think Barack Obama has to do?

GERGEN: Barack Obama has to do more than sit on his lead. I think Alex is right. There's been too much of that. And I think he's got to come out forceful tonight. This is his final big message before he gives these -- a couple of major speeches.

I think tomorrow night, he really has to crystallize and win convincingly, if he can, because he can probably put it away tomorrow night if he has a convincing, really inspiring debate.

COOPER: All right. Appreciate it, all you guys talking tonight. Roland Martin, Alex Castellanos.

MARTIN: Free Sarah. Talk to Anderson. I want her to (UNINTELLIGIBLE), Anderson.

COOPER: Put it on a T-shirt, Roland.

David Gergen, thanks very much. We'll see you tomorrow night.

We discussed voter Registration. It's very easy to Register to vote. But the deadline has passed in a lot of states. We've got all the information on our Web page, You can stroll down, click on the Register to vote, if you still can, link.

Still ahead, finance experts join us to talk about what happens now with the bailout and your bank account.

Also, our "Ten Most Wanted Culprits of the Collapse." A new name on the list tonight. Who is it? Well, here's a hint: he became synonymous with the economy during his nearly 20 years in government. Find out who it is and why he has been costing you money.

And a dramatic development in the case of 3-year-old Caylee Anthony, who's been missing for months now. Her 22-year-old mom -- that's her -- back behind bars. Find out why and if police are any closer to figuring out what happened to her little girl when 360 continues.


COOPER: Another day another twist in the bailout plans. Just ahead, what the administration's new plan to seek a quarter trillion dollars into failing banks means for you and your family.

But first, Erica Hill joins us with a "360 News and Business Bulletin" -- Erica.

ERICA HILL, CNN ANCHOR: Anderson, a state of emergency tonight in effect for two Southern California counties where wildfires have now killed two people and forced thousands to flee. And there's a major fire raging now in San Diego County. Together, these blazes burning more than 27 square miles, have destroyed dozens of homes.

A Florida grand jury has indicted the mother of missing toddler Caylee Anthony on seven charges, including first-degree murder. Casey Anthony was arrested this afternoon. Investigators say she waited more than a month before reporting her daughter missing in July. She could face the death penalty if convicted. Three-year-old Caylee's body has not been found.

The IRS says about a quarter of a million overdue economic stimulus checks will be mailed out this month. They'll go to married couples who were denied the money because a spouse's married name and Social Security number didn't match. And just how do you reach the elusive pilot vote in election '08? Or perhaps a flight attendant? A frequent traveler? Crop circles anyone? An iReporter in Oregon noticed this rather unusual artwork during a training flight southwest of Portland. It's what one of our writers calls grassroots campaigning. Ching.

COOPER: Ba-dum-bah.

HILL: Yes.

COOPER: Is your nose running?

HILL: Trying not to let it.

COOPER: Yes. Cool.

HILL: It ain't easy.

COOPER: There's tissues spread all over.

HILL: Tissues everywhere, hot water. I'm pathetic right now.

COOPER: You're a trooper.

HILL: Thanks.

COOPER: Here's tonight's "Beat 360" photo, Michelle Obama campaigning yesterday for her husband at a rally in Minnesota.

Here's the caption from Chuck from our staff: "In an awkward moment on the trail, Michelle Obama fully commits to an unrequited, onstage hug with Hillary Clinton."


COOPER: All right. Think you can do better? Go to and click on the "Beta 360" link. Send us your entry. We'll announce the winner at the end, and of course, the winner gets one of those fancy-shmancy T-shirts.

HILL: Fancy indeed.

COOPER: Indeed.

Still ahead, stocks slumped after the treasury secretary revealed details of a hard to swallow financial bailout.


HENRY PAULSON, TREASURY SECRETARY: These actions are not what we ever wanted to do, but today's actions are what we must do to restore confidence in our financial system.


COOPER: Will it work? Our financial panel weighs in on what this means for you.

And during the boom years, he was thought to be a genius, piloting our economy through year after year of gains in stocks and good times in the housing markets. Now he joins, tonight, our "Ten Most Wanted Culprits of the Collapse." Find out who he is when 360 continues.


COOPER: Updating our breaking news, Asian markets down as investors start digesting plans in Europe and here at home to bailout financial institutions and get frozen credit markets moving again.

Bumpy day on Wall Street, as well. The Dow soaring, plunging, then closing slightly on the down side as details of the administrations rescue plan kind of sank in.

Let's dig deeper now with James Stewart, staff writer for the "New Yorker" magazine and Diane Swonk, chief economist for Mesirow Financial.

Diane, thanks for being with us. The administration's bailout plan seems to kind of change by the day. Can you explain what this morning's does for people who are listening right now, for average Americans?

DIANE SWONK, ECONOMIST, MESIROW FINANCIAL: Well, what we hope it does is eventually put capital, actually taking money from the government, putting it into banks and hope they come around and loan it out. And that's the hardest -- the hardest stuff is to get banks to actually move on it once they get it. Getting it is one step. The next is actually getting it out the door, which has not been happening over the last three weeks at all.

COOPER: Jim, as I was saying, your writing is -- I've been following it closely, especially during all this. And I find it very -- not soothing but helpful. And so I'm a huge fan of your work. What do you -- for people who are listening tonight, who are worried, and there's a lot of folks worried out there. I mean, what do you think about what you heard today and what you see happening in the next few weeks?

JAMES STEWART, STAFF WRITER, "NEW YORKER": Well, I think this is very positive. I mean, this is largely a psychological crisis. People on Main Street don't trust their banks. They're pulling cash out, putting it in safe deposit boxes. Wall Street bankers don't trust each other. They won't loan money to major institutions overnight.

We have to break this paralysis. It's like a heart-attack victim that has to be shocked back into heart beating. And we've just got to keep shocking it until it starts to work again. This is another step in that process, putting capital in the banks. Really, at this point, I think people should realize, their money is safe.

COOPER: Especially now more than ever in banks, because it's been raised to $250,000.

STEWART: Exactly.

COOPER: I want to play something that Secretary Paulson said in his speech today, hasn't been discussed much, which was foreclosure. Let's listen.


PAULSON: We expect all participating banks to continue and to strengthen their efforts to help struggling homeowners who can afford their homes avoid foreclosure. Foreclosures not only hurt the families who lose their homes; they hurt neighborhoods, communities and our economies as a whole.


COOPER: So Jim, I mean, how does this work? And doesn't this essentially give the government control over banks?

STEWART: Well, we're on that. We're in that process.

Certainly, the government has taken a big ownership role in banks. I mean, this is a big step in the United States. Shall I use the "S" word, socialism? I mean, this is a socialist doctrine. I mean, European banks until fairly recently, many of them were entirely owned by the government. This is a whole different approach to the way an economy should work.

But there's nothing wrong with it. WE can take the stakes. It happened in the Depression. We can -- you know, once they're healthy, we'll probably get out again and restore it to the -- you know, the free market.

COOPER: Diane, both you and Jim have said that the administration might have to go further with the bailout. What do you mean?

SWONK: You know, I think what we are sort of one block into what -- I just watched the Chicago marathon on Sunday. It's a long way to go still.

The good news is, I think this is a major step. But the bad news is that we're doing it into an economy that's not only in recession. The last three weeks have added insult to injury on that recession. And we've really seen things deteriorate. Nothing like I've ever seen in my career, where the ground is moving literally day-by-day and the ground is deteriorating underneath us.

We saw people who couldn't get auto loans who had 800 score on their FICA scores. We saw home equity lines of credit literally eliminated overnight because banks weren't providing this credit.

So this is really important to jump-start the system through the banking system, but then we've still got to deal against the backdrop of a deteriorating economy. We've been losing jobs. We're going to lose more jobs before the end of the year. And I think we're going to have to see more moves by the Fed to ease more moves abroad to lower interest abroad. This is a global problem now.

The one thing I will say that's really reassuring, not only that we do have a sound banking system, but more importantly, this is now -- we've seen a seismic shift in the policy shift here: from, you know, this ad hoc, some firms win, some firm lose, sort of back behind the -- behind doors, behind closeted doors, who's going to have what happened, to being very open about the prosecution.

We had Ben Bernanke write an op-ed piece in the "Wall Street Journal" today to -- being very open and saying this is a much more holistic, systemic approach. It's not only the U.S. We've got the whole world with their oars in the water, trying to get the boat to land.


SWONK: And I think that's very important stuff.

COOPER: Definitely all hands on deck around the world right now.

The article, Jim, I read in the "Wall Street Journal" of yours last week, which I found so fascinating, was about your buying philosophy and your selling philosophy of stocks. You're -- briefly, I mean, you are very regimented in how you buy and sell.

STEWART: I am. I try to buy low and sell high. Isn't that the oldest adage in the book? And yet...

COOPER: And everybody says that's what they want to do, but when you...

SWONK: Almost never follow it. Right.


STEWART: Yes, it never happens, does it? Think of how many other products. You cut the price 50 percent and people say, "Oh, no, no. I don't want it." You double the price, and they say, "Oh, yes, I want more of that." Stocks are the strangest thing.

SWONK: Only in stocks.

STEWART: It's very -- it's very...

COOPER: But if the stock you own goes up 25 percent, you sell?

STEWART: Then I take profit. But you know, last week...

COOPER: Goes down, 10 percent.

STEWART: ... everybody was going -- I was at a cocktail party. Everybody was saying, "Oh, I sold. I said and got out. No financials."

And I'm saying, "Well, yes, I bought." It's like they looked at me like I was from another planet. But stocks are cheap.

SWONK: I bought, too.


COOPER: It's great to have you on the program. Jim Stewart, thanks so much.

And Diane, thanks so much. I appreciate having you on the first time, and we'll look to have you back.

Still ahead, the people who used to -- who helped get us into this mess, at least one of them. We're adding name to our "Ten Most Wanted List," "The Culprits of the Collapse," coming up.

Plus, an early -- well, it was an early morning ambush aimed at getting me to do the unthinkable, which is dance. Kelly Ripa gave it her best shot. We'll show you how that worked out.


COOPER: "The Ten Most Wanted List." So far, we've named four "Culprits of the Collapse." The movers and shakers in politics and finance who, in their own ways, have helped put you and your children's financial security in peril.

One of the things that's so frustrating about this financial crisis is that so few people have taken any responsibility for it. They all seem to be pointing fingers at other people, usually from other political parties. We think it's important you know who's responsible for the crisis, and we promise to keep naming names. And tonight, we're adding another one: Alan Greenspan, the second longest- serving chairman of the Federal Reserve.

Here's 360's Tom Foreman.


TOM FOREMAN, CNN CORRESPONDENT (voice-over): For nearly 20 years, no one held greater sway over the U.S. economy than Federal Reserve chairman Alan Greenspan. When he raised or lowered interest rates, he rocked the financial world.

ALAN GREENSPAN, FORMER CHAIRMAN, FEDERAL RESERVE: The economy is doing reasonably well.

FOREMAN: Greenspan's use of interest rates to encourage investment and discourage inflation was widely praised as he steered the markets toward recovery after the dot com bust and then again after 9/11.

He helped put oceans of Americans into homes by creating a favorable environment for low cost or adjustable rate mortgage. Hold on, says Peter Schiff, who has his own brokerage firm, once advised Ron Paul, and was an early critic of Greenspan. PETER SCHIFF, ECONOMIST: The reason they were able to get all these teaser rates was because the Fed artificially kept those short- term interest rates down. There would be no subprime problem. There would be no exploding arms right now if it weren't for the artificially low interest rates that made it possible for people to borrow under those terms.

FOREMAN: Such critics say Greenspan's low rates made borrowing money seem too safe and easy. Some people bought homes they could not afford. Businesses took risks and made investments they should have avoided. Everyone who took part, like a person on a credit card buying spree, appeared richer, until the house of cards fell.

(on camera) Greenspan was warned that problems were developing in the subprime market, but he appears to have never lost his faith that market forces, not more regulation, would keep the situation from exploding.

(voice-over) And at, Mark Zandi believes Greenspan always meant well.

SCHIFF: I think he thought that, you know, we were in a period of weak economic conditions. What better way to get out than to try to stimulate homeownership. Unfortunately, it didn't work quite the way he thought it would.

FOREMAN: Greenspan did not answer our request to talk about all of this but he has often defended his policies, suggesting greed is really to blame for creating the financial flood. In retrospect, even some of his supporters admit, he did help set up the problem. And according to some critics...

SCHIFF: The reason we have a flood is because Alan Greenspan blew up the dam.

FOREMAN: That makes Alan Greenspan one of our "Ten Most Wanted Culprits of the Collapse" -- Anderson.


COOPER: So let's make it official. Alan Greenspan, appointed by Reagan. He served under both Bushes and Bill Clinton. He now joins our "Ten Most Wanted Culprits of the Collapse." We began last week with Joe Cassano from AIG, followed by Richard Fuld from Lehman Brothers, Chris Cox from the SEC, and last night, Senator Phil Gramm of Texas.

Just ahead on 360, something to make you smile. Kelly Ripa trying to get me to dance on live television this morning. She pulled out all her moves. She has many moves. Find out if it worked.

Then, on the eve of a financial election debate -- on the eve of a financial election debates, the race intensifies. John McCain unveiling his new economic plan a day after Obama's. We'll have the latest on the trail and in the polls, coming up at the top of the hour. (COMMERCIAL BREAK)

COOPER: Time for our "Beat 360" winner, Erica. Daily challenge to viewers to come up with a caption better than the one anyone on our staff can come up with.

So here's the picture: Michelle Obama campaigning yesterday for her husband at a rally in Minnesota. Chuck is our staff winner. His caption: "In an awkward moment on the trail, Michelle Obama fully commits to an unrequited on-stage hug with Hillary Clinton."


COOPER: Your winner, Nicholas from Trinidad and Tobago. Cool. His caption: "Laura, throw the White House keys over here!"


COOPER: Nicholas, your "Beat 360" T-shirt is on the way, all the way to Trinidad and Tobago.

You can check out all the entries we receive on our blog. Trinidad and Tobago is a great place.

HILL: I've heard that.

COOPER: Yes. Play along tomorrow by going to That's our Web site.

So time for "The Shot." Now, I was filling in for Regis on "Live with Regis & Kelly" this morning. I'm doing it again tomorrow morning. And I told the amazing Kelly Ripa that I went to a Prince concert on Friday.

HILL: Get out! Really?

COOPER: Yes. And then she tried -- what, you didn't watch the show this morning? No, no, no, that's fine. Anyway, I digress.

HILL: I was at class with Westin, getting a cold.

COOPER: OK, all right. Child care. That's all right. That's acceptable. You probably TiVod it.

Anyway, she tried to get me to dance. It was very painful for everyone involved. See for yourself.


KELLY RIPA, CO-HOST, "LIFE WITH REGIS & KELLY": Give me an example of Anderson dancing.

COOPER: No way in a million trillion years.

RIPA: I'll sing Prince right now.

COOPER: It's not going to happen. You can clap all you want. That's not going to happen.

I cannot dance. I simply cannot.

RIPA: Give me your hand. Yes!


HILL: How can you resist that?

COOPER: She's amazing. I like that she was just, like, already just all out dancing.

HILL: Exactly. I love it.

COOPER: Yes. This is my favorite part where she does the drop to the floor thing. There you go.

HILL: You know, if I were you, I wouldn't have danced either, because there is no way you can top that, my friend.

COOPER: I know. There's no way. Yes.





HILL: There you go. Remember?


HILL: Nice. There you go. It's not even bullet proof Friday, and the boys are back.

COOPER: There we go.

All right. Coming up at the top of the hour, no more dancing, serious stuff. Looking ahead to tomorrow's debate with the campaign, war of words intensifying.

And later, why chances to talk with Sarah Palin are, well, pretty hard to come by. We'll be right back.