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CNN Live Event/Special

The Next President: Debates Round 1

Aired September 28, 2008 - 23:00   ET

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

JOHN KING, CNN CHIEF NATIONAL CORRESPONDENT: Good evening I'm John King.
After days of drama that put the entire White House race in limbo, Senators John McCain and Barack Obama were together at Ole Miss for the first presidential debate. For the country and for the candidates the stakes could not have been higher.

The nation is facing the worst financial crisis since the Great Depression and although the focus was foreign policy, it was the economy that took center stage at the start.

Senators Obama and McCain stood just feet from each other but they were worlds apart on the critical issue. The difference was striking.

Who won? Who lost? And who twisted the truth?

Over the next two hours, we'll show you the highlights and on hand to helps us as always, the best political team on television.

We begin with the bailout, with banks failing and Wall Street reeling, Washington is trying to save the economy from collapsing.

Senators Obama and McCain were asked directly where they stand on the financial rescue plan. It is, of course, the $700 billion question.

And here's what they said.

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN, (R) PRESIDENTIAL NOMINEE: I've been not feeling too great about a lot of things lately so have a lot of Americans who are facing challenges but I'm feeling a little better tonight and I'll tell you why.

Because as we're here tonight in this debate we are seeing for the first time in a long time, Republicans and Democrats together, sitting down trying to work out a solution to this fiscal crisis that we're in. And have no doubt about the magnitude of this crisis and we're not talking about failure of institutions on Wall Street. We're talking about failures on Main Street and people who will lose their jobs and their credits and their homes if we don't fix the greatest fiscal crisis probably, certainly in our time.

And I've been around a little while.

But the point is, the point is, we've finally seen Republicans and Democrats sitting down and negotiating together and coming up with a package. This package has transparency in it; it has to have accountability and oversight. It has to have options for loans to failing businesses rather than the government taking over those loans. We have to -- it has to have a package with a number of other essential elements to it.

And, yes, I went back to Washington and I met with my Republicans in the House of Representatives. And they weren't part of the negotiations and I understand that. And it was the House Republicans that decided that they would be part of the solution to this problem.

But I want to emphasize one point. To all Americans tonight, this isn't the beginning of the end of this crisis. This is the end of the beginning if we come out with a package that will keep these institutions stable.

And we've got a lot of work to do. And we've got to create jobs and one of the areas, of course, is to eliminate our dependence on foreign oil.

JIM LEHRER, PRESIDENTIAL DEBATE MODERATOR: All right let's go back to my question. How you all stand on the recovery plan and talk to each other about it. We've got five minutes; we can negotiate a deal right here.

But I mean do you favor this plan? Senator Obama? And when you, Senator McCain, are you in favor of this plan?

SEN. BARACK OBAMA, (D) PRESIDENTIAL NOMINEE: We haven't seen the language yet. And I do think that there's constructive work being done out there so for the viewers who are watching, I am optimistic about the capacity of us to come together with a plan.

The question, I think, that we have to ask ourselves is: How did we get into this situation in the first place?

Two years ago I warned that because of the sub-prime lending mess, because of the lax regulations that we were potentially going to have a problem and try to stop some of the abuses in mortgages that were taking place at the time. Last year I wrote to the Secretary of the Treasury to make sure that he understood the magnitude of this problem and to call on him to bring all the stakeholders together to try to deal with it.

So the question, I think, that we've got to ask ourselves is, yes, we've got to solve this problem short-term and we are going to have to intervene. There's no doubt about that. But we're also going to have to look at how is it that we shredded so many regulations, we did not set up a 21st century regulatory framework to deal with these problems and that, in part, has to do with an economic philosophy that says that regulation is always bad.

LEHRER: Are you going to vote for the plan, Senator McCain?

MCCAIN: I hope so.

LEHRER: Well, you're a United States Senator, both of you -- are you're going to vote for the plan?

MCCAIN: Sure, but let me point out, I also warned about Fannie Mae and Freddie Mac and warned about corporate greed and excess and CEO pay and all that. A lot of us saw this train wreck coming but there's also the issue of responsibility.

You've mentioned President Dwight David Eisenhower. President Eisenhower on the night before the Normandy Invasion went into his room and he wrote out two letters.

One of them was a letter congratulating the great members of the military and allies that had conducted and succeeded in the greatest invasion in history; still to this day and forever. And he wrote out another letter. And that was a letter of resignation from the United States Army for the failure of the landings at Normandy.

Somehow we've lost that accountability. I've been heavily criticized because I called for the resignation of the chairman of the Securities and Exchange Commission. We've got to start, also, holding people accountable and we've got to reward people who succeed. But somehow in Washington today, and I'm afraid on Wall Street, greed is rewarded.

(END VIDEO CLIP)

KING: Now, both candidates, both candidates there speaking in general terms about the economy and about the bailout. But where were the details, the specifics? And while they had plenty to say what just what was missing?

Joining me is CNN senior business correspondent, Ali Velshi. Let's start with that, what was missing. These are the two guys who want to be president, no details.

ALI VELSHI, CNN SENIOR BUSINESS CORRESPONDENT: Now, we had history about what Barack Obama did two years ago and history that went back to the invasion of Normandy.

But I'd like a little history about what happened in the last week; about what they were supposed to have been thinking. They were asked directly, will you support these plan and they hedged on that. They didn't give Americans the sense of what they think the solution is.

One of my producers gave me this analogy. It's like you're three- year-old kid set fire to your curtains and when the fire department arrives you're yelling at your three-year-old kid about setting fire to the curtain and then the two fire captains are arguing with each other about whether it was the lack of fire proof curtains or the fact that kids have lighters.

At some point hold, this discussion off for a second and talk about exactly what's going to go on. And you were on Montana; I've been getting phone calls and emails from across America. Americans are confused about what this is. They think its Wall Street speak mixed with economic speak and now combined with political speak and no one is speaking to them about the things that are hurting them. KING: Well, let's follow-up for that. Because I was out at Montana this week and people say they don't trust this; the bunch of guys in suits going to into back rooms and making deals. And they say they don't know the specifics. Sure they want to help people are being foreclosed, but they don't want those money to go to rich people. What could and should they have said?

VELSHI: A great narrative about the fact that this credit squeeze that fact that the credit markets in America are frozen mean that companies can't get money. And not just banks. Companies can't get money to make their operating payments which means your salary may be at risk.

That means more jobs are going to be lost. It means that we're in a recession anyway and if we don't do this we're going to be in a deeper recession. This doesn't get us out of one. This is a bitter pill; we all got us into this.

But here is how I am going to get us out. I'm going the make sure we have a deal by the end of the week. I'm going to work on this; I'm going to sell this to the American people.

There was none of this. That was a history lesson last night.

KING: If you're John McCain and Barack Obama in short, what do you most worry about that you're going to inherit?

VELSHI: Well, look, you're going the inherit a mess, what you're most worried about is you're going to inherit a bigger mess, but essentially what you're going to do now is you're going to find yourself supporting a deal that you have to support but as you and I both know Americans are not supporting right now. They are falling and falling further away from this because they see it as a Washington and Wall Street fat-cat bailout.

KING: Ali Velshi thanks very much.

Now, the moderator, Jim Lehrer kept pressing the candidates to talk specifically about the bailout plan. He even said maybe the two could just right there cut a deal on stage. We'll give Jim points for trying. But what about Obama and McCain and won that round? Who had the best answers?

With me now: Democratic strategist and CNN contributor Donna Brazile; Republican strategist and CNN senior political contributor Ed Rollins and CNN senior political analyst, Gloria Borger.

The economy is never won; this was supposed to be a foreign policy debate. Ed Rollins right off the bat, they were asked about the bailout. These are two men who want to be president of the United States. I have no details of what either one would do.

ED ROLLINS, CNN SENIOR POLITICAL CONTRIBUTOR AND REPUBLICAN STRATEGIST: They had no details, they didn't have a clue.

First of all, neither of them are part of the process and I think to a certain extent they want a deal but they don't know what the details of the deal are. That's what he did and he's for the deal.

But there was no details. I think that was the biggest disappointment to many Americans and equally as important when they were asked specifics about the economy. McCain said he would cut out all the earmarks, which is not accurate. There's $18 billion in there and a lot is defense and that's going to be cut out. And I think that Senator Barack basically didn't have details either.

KING: At this partisan time, do we have a bipartisan agreement there? Do you agree that it was a disappointment; that neither of these guys said this what the country needs to do now?

DONNA BRAZILE, CNN CONTRIBUTOR AND DEMOCRATIC STRATEGIST: I think what Senator Obama tried to do was to lay out the principles. And McCain agreed with many of those principles, protect the taxpayers, stabilize the markets, make people more accountable on Wall Street.

But beyond that they had no real details because the deal is still being worked out. And as you know the devil is in the details.

This was an opportunity for Senator Obama to really stick eight years of George Bush policies on John McCain's lap. I thought he tried to do that with tax cuts but he didn't go all the way in spelling out what he would do differently as president.

KING: An anxious country out there Gloria, wants to know what's going to happen. $700 billion of their money; maybe they'll get it back, maybe they won't. The quickie poll after and these things sometimes don't prove out true over time, but after our viewers, viewers and people who watched the debate 58 percent said Obama could better handle the economy and 37 percent McCain. So, advantage Obama on this issue but did either one of them make the personal connection?

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: No. Yes, they get, first of all, advantage to Obama, he goes in with an advantage and leaves with maybe a little more of an advantage but it's so interesting.

After the debate, the spin, which we were all getting from the Obama people was, Obama was all about the future. John McCain was all about the past. Except when he was talking about the economy as Donna just said. Because when he was talking about the economy he was all about the past. He was all about George W. Bush getting us into this mess eight years of George W. Bush and John McCain.

So I think the politicians, and these fellows of politicians they didn't want to get ahead of their parties. They didn't want to get ahead of the negotiations. They didn't want to mess it up. Honestly they could. And so they had to hang back and the problem was, from a debating point of view, is that honestly they agree on a lot of the principles that need to be in this plan.

KING: They're not just politicians they are senators. You worked for Ronald Reagan, the Great Communicator. Why is it that governors are able to make this connection with people that senators often have trouble with? ROLLINS: The governors have to. Senators basically have to vote on several major issues a month but they can hide in Washington if they choose and not even go back home until every five years when they have to run for re-election.

A governor has to be on the line, a governor has to make budget cuts. The governor basically has to present programs for people. And senators get hidden in these big massive reconciliation bills or what have you.

KING: Stand by, everybody.

BORGER: That's why they're going to get to be president.

KING: That's right, that's why they generally win. That's right, but a senator is going to win this time. We do know that fact.

Stand by, everybody; a lot more to cover from the polls to the promises. The candidates talk taxes. Who's telling the truth? That's next.

(COMMERCIAL BREAK)

KING: Debating the first debate; that's what we're doing tonight. And we're also of course, looking over to the political landscape; mapping out the state of the race. Where does it stand now? What are the candidates trying to change?

Let's do it by checking out the "Magic Wall" and the candidates ended the first debate in a remarkably close race. You need 270 electoral college votes to win.

Advantage Obama at the moment but still very competitive.

Let's look at one hypothetical scenario that shows you just how tight this race could be as we get close to the end.

John McCain of course the Republicans have won the state of Ohio. But let's give the state of Ohio, you see what that does, it makes him a little more competitive. Right now, Florida is close but most Republicans think they have an advantage there. Let's say for the sake of argument John McCain picks up those votes 270 electoral votes. And look what's happens to the race at large.

The state of Virginia, Obama is trying but it's been a red state for a long time; that would put John McCain in the lead if he picked that up. But of course, this is the state right here, Wisconsin that's been blue in the last few elections. We'll give that to Barack Obama. And so has the state of Minnesota, let's give that, for the sake of argument again as a hypothetical, to Barack Obama.

The Latino vote critical out here in Nevada, Barack Obama trying very hard. Let's assume he wins that one but let's come up here in the state of New Hampshire; big fight for the Independent vote advantage Obama at the moment. Colorado a big battleground, I was out there just last week. At the moment Republicans think they have a slight advantage.

Look what would happen if it played out that way; 269 to 269. Nobody wins and the presidential race goes to be settled in the United States Congress.

Now, no one believes this will happen. Everyone thinks the map will break somewhat differently at the end, but this is a look at how competitive this race could be which brings you to the key point.

Red state, blue state, battleground state, no matter where you are it's the economy that matters the most. You know that and of course so do the candidates. During the debate they both went on the record talking taxes, spending and even sacrifice.

Let's listen.

(BEGIN VIDEO CLIP)

OBAMA: Well, I'm not willing to give up the need to do it but there may be individual components of it that we can do. But John's right that we've got to make some cuts.

We, right now, give $15 billion every year as subsidies to private insurers under the Medicare system. It doesn't work any better through this private insurers; they just skim off $15 billion. That was a give-away. And part of the reason is because lobbyists are able to shake how Medicare works. They did it on the Prescription Drug Bill and they've done it with respect to Medicare. And we are going to have to change the culture.

John mentioned me being wildly liberal. Mostly that's just me opposing George Bush's wrong-headed policies since I've been in Congress but I think that it is also important to recognize that I worked with Tom Coburn, the most conservative and one of the most conservative Republicans who John already mentioned, to set up what we call a Google for government, which says that we are going to list every dollar of federal spending to make sure that the taxpayer can take a look and see who, in fact, is promoting some of these spending projects that John's been railing about.

MCCAIN: What I'm trying to get at is this --

LEHRER: Excuse me if I may, Senator. That you all -- one of you is going to be the president of the United States come January in the middle of a huge financial crisis that is yet to be resolved. And what I'm trying to get at is how this is going to affect you not in very -- in small ways but in major ways and the approach you would take as to the presidency?

MCCAIN: Well, how about a spending freeze on everything but defense, veteran affairs and entitlement.

LEHRER: Spending freeze?

MCCAIN: I think we ought to seriously consider with the exceptions of caring for our veterans, national defense and several other vital issues.

LEHRER: Would you go for that?

OBAMA: Well, the problem a spending freeze is you're using a hatchet where you need a scalpel. There are some programs that are very important that are currently under funded. I want to increase early childhood education and the notion that we should freeze that when there may be, for example, this Medicare subsidy I think doesn't make sense.

Let me tell you another place where I'd like to look for some savings. We're currently spending $10 billion a month in Iraq when they have a $79 billion surplus. It seems to me that if we're going to be strong at home as well as strong abroad, that we've got to look at bringing that war to a close.

MCCAIN: We're sending $700 billion a year overseas to countries that don't like us very much. Some of that money ends up in the hands of terrorist organizations. We have to have wind, tide, solar, natural gas, flex fuel cars and all of that. But we also have to have offshore drilling and we also have to nuclear power.

Senator Obama opposes both storing and reprocessing of spent nuclear fuel. You can't get there from here. And the fact is, that if we can create 700,000 jobs by building, constructing, 45 new nuclear power plants by the year 2030. Nuclear power is not only important as far as eliminating our dependence on foreign oil but it's also important as far as climate change is concerned. And the issue that I've been involved in for many, many years and I'm proud of the work I've done there along with Senator Clinton.

LEHRER: Let me see. Before we go to another lead question, let me see if I could figure out a way to again, ask the same question in different -- a slightly a different way here. Are you willing to acknowledge, both of you, that this financial crisis is going to affect the way you rule the country as president of the United States, beyond the kinds of things that you've already -- I mean is it a major move? Is it going to have a major affect?

OBAMA: There is no doubt that it's going to affect our budgets. There is no doubt about it. Not only -- even if we get all $700 billion back -- let's assume the markets recover and we're holding assets long enough that eventually taxpayers get it back.

And that happened during the Great Depression when Roosevelt purchased a whole bunch of homes. Over time home values went back up and, in fact, the government made a profit. If we're lucky and we do it right that could potentially happened.

But in the short term there's an outlet. And we may not see that money for a while and because the economy is slowing down, I think we can also expect less tax revenues. So there's no doubt that as president, I'm going to have to make some tough decisions.

(END VIDEO CLIP) KING: Both campaigns, you'll be shocked, in heavy spin mode following the debate. But will the candidates admit to any setbacks especially on issue number one the economy.

Joining me is CNN's Dana Bash. She's tracking the McCain campaign and CNN's Jessica Yellin in Washington where Barack Obama is this day.

Dana Bash, John McCain comes in tax and spend, tax and spend, tax and spend trying to paint Obama as the most liberal member of the United States Senate. Who is he trying to reach?

DANA BASH, CNN WASHINGTON CORRESPONDENT: Well, a couple of things. First of all it's obviously the classic argument that Republicans use over and over again. It might seem worn but it's also tried and true. So that's number one.

Secondly, who is he trying to reach? Some people in his own party, who maybe, are in -- you're at the map -- the suburbs of Philadelphia, registered Republicans but they don't really feel necessarily like they want to go with another Republican, maybe looking towards a Democrat.

But then they hear that message about the fact that they're worried about Barack Obama raising their taxes, that might resonate; those kinds of people.

And also, you heard him talk about Hillary Clinton there. That was not an accident even with regards to climate change. He is still trying to see if he can pull some of her voters from the primaries over to his camp. So basically, the moderate Republicans and the conservative Democrats who sit along the line that will determine which one of these men become president.

KING: So Jessica Yellin, tax and spend, pushing him out of the Main Street and that worked against Al Gore and John Kerry, Barack Obama said I'll make tough choices. I might have to even delay my plans and I pay for my plans.

How is he handling this traditional argument as Dana puts it?

JESSICA YELLIN, CNN CORRESPONDENT: He's hitting back hard on that and you've heard it at another point in the debate when he said, "John McCain has said that I'm going the raise your taxes and he'd looked at the people and the camera and said I will not raise taxes on 95 percent of you."

They are going after the exact same people Dana just outlined, those Reagan Republicans, those moderates who voted for Hillary Clinton in the primary and might not yet know where they want to go now.

Barack Obama's trying to send the message and he did it last night, by repeatedly saying he's with the middle class, that he will not hurt you at the kitchen table. He will not hurt average folk. He wants to convey that he's really in touch with what people are feeling in this economic pinched time. And they feel they did a very good job of that last night even by continually praising John McCain which also reaches these people who, basically, thinks that Washington is filled with what we hear. Jokers and these guys need to get along more than argue.

KING: Jessica, Dana, thanks back to you in a bit.

Now, if you were watching McCain attacked Obama, tax and spend Democrat. Obama struck back by blaming the Bush-McCain policy -- get that -- the Bush-McCain policy for the financial mess we're right.

Lots to talk about here, with me again, Democratic strategist and CNN contributor Dana Brazile, Ed Rollins, Gloria Borger.

Ed it is tried and true as Dana put it, tax and spend, tax and spend, tax and spend, it has worked. Can McCain make the case as effectively against Barack Obama as say, George W. Bush did against Gore and Kerry?

ROLLINS: He's certainly is going to try. But it's a very complicated. We need more revenue and you need to get more revenue by growth and you get more revenue by basically raising taxes. It's more believable the Democrats will raise taxes than Republicans, but at the same time I think that's the debate's issue.

KING: It's the quadrennial "pin the tail" on the donkey. The Republicans try this every four years. Barack Obama is probably more liberal than Gore or Kerry but is he a more effective communicator in fighting back?

BRAZILE: You know both aspired (ph) to Republicans in 2006 because they thought the Republicans mishandled the war and also the Republicans mishandled the budget.

The next president will have to deal with enormous deficits. The fiscal year begins on October 1st. And the next president will inherit a $600 billion deficit for the next fiscal year, plus on top of that, $6 trillion in debt.

So the next president will be constrained. And I don't think going back to the old sound bites will work. Barack Obama, if he's president, will have to make some serious spending decisions and so will John McCain.

KING: When you listen to these guys -- I'm going to probably say this again and again -- because in my travels when you talk to people they don't feel a personal connection with these guys as they worry about the house next door got foreclosed. What does that do to my property value? The GM plant is closing or shrinking, what does that do, not just to the guy's worked there but to everybody in town. Whether it's the pizza guy, or the dry cleaners and everybody else; how do these guys connect to more people?

BORGER: Think Obama tried to do that in talking about how the bailout affects you and your 401(k) and your pension but I think there is this disconnect as there always has been, John, between Washington and the world out there.

That's why I was surprised in a way that McCain didn't come into that debate with more of a populist message because he's been singing that popular song all over the country and he didn't -- he didn't do that in the debate.

KING: Much more to talk about. We'll be here for a long time to come and more toward the debate to analyze.

And next the candidate goes into attack mode. McCain jabs on Obama's judgment. Did he deliver? Well, you decide.

When "THE NEXT PRESIDENT, DEBATES: ROUND ONE," continues.

(COMMERCIAL BREAK)

KING: Welcome back to "THE NEXT PRESIDENT, DEBATES: ROUND ONE." You heard a lot of policy on that stage at Ole Miss, plenty of punches too.

Senator Obama tried to paint Senator McCain as being out of touch with the country, an ally of President Bush and having what you might call a 20th-century mind set. We'll show you how Obama attempted to do that a bit ahead.

But first, McCain's mission; it was without a doubt an effort to make his younger rival appear inexperienced and even naive. Watch.

(BEGIN VIDEO CLIP)

MCCAIN: Senator Obama still doesn't quite understand or doesn't get it that if we fail in Iraq, it encourages Al Qaeda. I don't think that Senator Obama understands that there was a failed state in Pakistan when Musharraf came to power. I'm afraid Senator Obama doesn't understand the difference between a tactic and strategy. Again, a little bit of naivety there, he doesn't understand that Russia committed serious aggression against Georgia.

If we adopted Senator Obama's set date for withdrawal then, that will have a calamitous affect on Afghanistan and American National Security interest in the region. Senator Obama doesn't seem to understand there's a connection between the two.

What Senator Obama doesn't seem to understand that if without precondition, you sit down across the table from someone who has called Israel a stinking corpse and wants to destroy that country and wipe it off the map, you legitimatize those comments. This is dangerous. It isn't just naive it's dangerous.

(END VIDEO CLIP)

KING: McCain kept hammering and hammering and hammering his point his challenger and he doesn't understand the issues that a president, that a commander-in-chief will have to face. But did it work?

Let's head back to CNN's Dana Bash. She's still at the debate scene in Oxford, Mississippi. In Washington, D.C, Jessica Yellin.

Dana, Haley Barbour, the governor of the state your in, used to have this favorite saying he likes to use here, I was born in night but it wasn't last night. It's pretty clear what John McCain was trying to do there. Shove Barack Obama way back, away from the threshold of ready to be commander-in-chief. Why is that so important?

DANA BASH, CNN CORRESPONDENT: Because that was and has been the crux of his entire campaign. We heard it a lot more before when he picked Sarah Palin, frankly, than we have in the past month or so. But I've got to tell you, in the spin room here in Mississippi, they were spinning -- oh, you know, McCain didn't have a lot of time to prepare. He really didn't prepare much at all.

Well, here's the real deal. He did prepare and that was the line. I talked to one of his advisers who was working with him, that they've worked on it meticulously because they wanted to get the tune just right to try to make the case, the obvious point -- that this is a guy standing next to me who isn't ready, he doesn't get it and you don't want him representing you on the world stage because he doesn't understand it -- but to try to do it in a way that was not kind of over the line, that was not overly obnoxious, frankly.

Whether or not that worked, it's really unclear, because another point was to really get under Obama's skin. Much like Hillary Clinton tried to do on this very same topic during the Democratic primaries. It worked for her. It seemed as though Barack Obama was ready for this kind of line, ready for this kind of tone and attack and he didn't bite.

KING: Well, let's talk about that. Jessica Yellin, Dana is dead right. Not only Hillary Clinton but the guy who shares the ticket with Barack Obama, Joe Biden, in the Democratic debate saying -- not ready, nice guy, ready some day, not ready now.

So, Barack Obama had to know it was coming. Did he deal with it differently in the general election debate than he did back in the primaries?

JESSICA YELLIN, CNN CORRESPONDENT: Yes, because he was ready. You guys both said it. I mean, his advisers are thrilled this morning because they feel he showed up looking presidential and looking comfortable in his skin in that role. That was the first most important mission last night for them and they think they aced that.

The other piece of this that they're pleased with is -- John McCain, he doesn't understand message sounded, in their view, divisive, and to many of these undecided voters, what they want to hear is agreement in Washington, people working together. That kind of criticism works with the base, the other guy doesn't get it, but when Barack Obama kept saying, "John, John," over and over, while pundits don't like that and the base doesn't like that, that message resonates with these undecided who want to see these guys working together. And that helps, in their view, make him seemed presidential, make him seemed like he can get stuff done. So, they were pleased. KING: Well, Dana, what about that Senator McCain at times sounded condescending, almost disdainful of Barack Obama, like, you don't belong on the same stage with me. Are they worried about that? Did he go over the line?

BASH: You know, it might have been and not just what he was saying, but also, just in terms of the uptakes and the mannerisms. He didn't really turn Obama at all. And not just -- it wasn't just him calling him Senator Obama and not Barack, like Jessica was referring to Obama on the way he addressed McCain. He didn't look at him.

So, I think the combination of those things, if you look at the dial testing that CNN did, it might not have been that beneficial to McCain. But the reality is, this is it, this is their big card, this is what they think that they have. Particularly on the stated issue that was the night's debate, which is foreign policy.

I mean, you heard him not just say -- you know, Barack Obama doesn't understand, but he tried to weave in points about Pakistan, about Iraq and about hot spots around the globe, trying to make the point that he does understand because he's been there. He's worked on it. So, it was really basically the card that he had to play.

KING: All right. Back to both of you in a bit.

But what did you think out there? Did McCain's mantra that Obama just doesn't understand hit its mark or fall flat?

Once again, let's bring in our panel: Democratic strategist Donna Brazile, Republican strategist, Ed Rollins, and our CNN senior analysts, Gloria Borger.

The tone from John McCain. He's obviously trying to push Obama away -- not ready. But did it go over the line? It did seem at times almost condescending.

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: Mean -- I think it sounded a little mean. And if you look at the dial test people were doing, every time he attacked him that way, the dial test absolutely went down.

And what Obama did in response, Obama kept saying, "I agree, I agree. I agree on foreign policy not on economic policy." And there was a clear message from the Obama campaign that they understand to get those independent voters, the independent voters don't like the nastiness so, when Obama said, "I agree," they think it worked for him, made him look less partisan while McCain was looking condescending, belittling and lecturing.

KING: You've been involved in a lot of these, Ed. The substance matters, but the style, the stage craft does, too. And as we talk, I want to show our viewers, these two, Obama reach across and said, "John," as Jessica was saying. McCain almost didn't want to look at him, even when they shook hand, he sort of shook and looked away. During the debate, he never looked over and engaged him. Does that matter? Is McCain trying deliberately to send a signal there? ED ROLLINS, REPUBLICAN STRATEGIST: Sure. At the end of the day, likeability is very important. And I think John McCain was a little harsh. He obviously came off as a commander-in-chief but the tone was a little bit condescending.

And, I think, Barack Obama basically sort of met the presidential level that he needed to do. McCain might have been a little better in his facts when he basically has called Pakistan a rogue state, which it wasn't. It was a democratically-elected Prime Minister Sharif, who was overthrown by Musharraf who was the chief of staff in the army, it's a dictatorship. That fact was very critical and John should have known that. That was 10 years ago.

KING: But the point of the substance of that argument was Barack Obama is not ready. He's 47-year-old. He's been in the United States Senate only one term. If you're a Democrat, I assume that is on the substance of picking the commander-in-chief, the biggest thing the party worries about, how did Obama meet the test?

DONNA BRAZILE, DEMOCRATIC STRATEGIST: I thought Senator McCain looked very frustrated. He did not appear to be comfortable debating Senator Obama. He wanted to paint him as inexperienced and out of his league, and Senator Obama came across as comfortable with the topics, confident in his answers, and he was seasoned in his approach to foreign policy.

He didn't make any major mistakes. He knew the names of all the various leaders. Perhaps he hasn't had as many stamps on his passport as John McCain, who could name practically every leader in the former Soviet Union, but the truth is, I thought that McCain came across as just very cranky.

KING: Part of the challenge is picking up new voters. But one of the other questions is, do you lose anybody? Did you say or do anything that cost you support you already had? Did either one of them do that?

ROLLINS: I don't think so, because McCain was reaching out and he was cold warrior. I mean, he clearly was a cold warrior talking to the over-50 group which is his sort of base. He didn't lose any of them. But I think, the bottom line is, this is about young voters. And did he attract some of the young independent voters that he needed to do and I'm not sure of that.

BORGER: No, because I think his tone was such that if you're belittling the younger guy, who could hold his own and go toe-to-toe, you're not going to attract those younger voters. And I think that is and would be a problem for him.

KING: And you know, the issue is the economy. But when you pull the curtain behind you, you're picking the commander-in-chief. Every campaign, you're in Al Gore's, you have to assume that people, even if the economy is number one, two, three and four, that they spend a little time on commander-in-chief.

BRAZILE: Perception matters. And I think last night, Senator Obama once again demonstrated that he can, you know, command the facts like anyone else. I think it helped him to have spent so much time with Hillary Clinton, who clearly won all the Democratic debates. Last night, Obama seemed less hesitant and respondent. He was on his game.

BORGER: I think...

KING: I thought Joe Biden won one of those debates. Time out one second, I thought Joe Biden one won or two of those Democratic debates. I think that sort of why he's on the ticket.

More to cover -- much more to cover.

Up next: The battle over the surge, the heated words between McCain and Obama on the war in Iraq. Who's right? Who's wrong? CNN's Michael Ware will help us out and our panel will weigh in. Stay with us.

(COMMERCIAL BREAK)

KING: Welcome back to our in-depth look at the first presidential debate. Tonight, we're dealing with the key moments of the important face-off between John McCain and Barack Obama. And we're checking the facts.

One of the most heated exchanges came when the topic turned to the surge in Iraq. Each candidate has a much difference stance on this war. Listen to this.

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN, (R-AZ) PRESIDENTIAL CANDIDATE: The next president of the United States is not going to have to address the issue as to whether we went into Iraq or not. The next president of the United States is going to have to decide how we leave, when we leave, and what we leave behind. That's the decision of the next president of the United States.

Senator Obama said the surge could not work, said it would increase sectarian violence, said it was doomed to failure. Recently on a television program, he said it exceeded our wildest expectations but, yet, after conceding that, he still says that he would oppose the surge if he had to decide that again today.

Incredibly, incredibly, Senator Obama didn't go to Iraq for 900 days and never ask for a meeting with General Petraeus.

JIM LEHRER, DEBATE MODERATOR: Well, let's go at some of these things.

MCCAIN: Senator Obama is the chairperson of a committee that oversights NATO that's in Afghanistan, to this day, he's never had a hearing.

LEHRER: What about that point?

MCCAIN: I mean, it's remarkable.

LEHRER: All right. What about that point?

SEN. BARACK OBAMA, (D-IL) PRESIDENTIAL CANDIDATE: Which point? He raised a whole bunch of them.

LEHRER: Well, there's a lot of points. Let it go. All right. Let's go to the latter point and we'll back up. The point about you're not having been...

OBAMA: Look, I'm very proud of my vice-presidential selection, Joe Biden, who is the chairman of the Senate Foreign Relations Committee, and as he explains, and as John well knows the issues of Afghanistan, the issues of Iraq, critical issues like that, don't go through my subcommittee because they're done as a committee as a whole. But that's Senate inside baseball.

Let's get back to the core issue here. Senator McCain is absolutely right that the violence has been reduced as a consequence of the extraordinary sacrifice of our troops and our military families. They have done a brilliant job and General Petraeus has done a brilliant job.

But understand, that was a tactic designed to contain the damage of the previous four years of mismanagement of this war. And so John likes -- John, you like to pretend like the war started in 2007. You talk about the surge. The war started in 2003.

And the -- at the time when the war started you said it was going to be quick and easy. You said we knew where the weapons of mass destruction were. You were wrong.

You said that we were going to be greeted as liberators. You were wrong. You said that there was no history of violence between Shiite and Sunni. And you were wrong. And so, my question is of judgment of whether or not, whether or not...

(CROSSTALK)

MCCAIN: Senator Obama...

OBAMA: If the question is who is best equipped as the next president to make good decisions about how we use our military, how we make sure that we are prepared and ready for the next conflict, then I think we can take a look at our judgment.

LEHRER: We've got a lot on the plate here.

MCCAIN: I'm afraid -- I'm afraid Senator Obama doesn't understand the difference between a tactic and a strategy. But the important -- I'd like to tell you, two Fourths of July ago, I was in Baghdad. General Petraeus invited Senator Lindsey Graham and me to attend a ceremony where 688 brave young Americans, whose enlistment had expired, were reenlisting to stay and fight for Iraqi freedom and American freedom.

I was honored to be there. I was honored to speak to those troops. And you know, afterwards, we spent a lot of time with them and you know what they said to us? They said, let us win. They said, let us win. We don't want our kids coming back here.

And this strategy, and this general, they are winning. Senator Obama refuses to acknowledge that we are winning in Iraq.

OBAMA: That's not true.

MCCAIN: They just passed an electoral...

OBAMA: That's not true.

MCCAIN: An election law just in the last few days. There is social, economic progress, and a strategy, a strategy of going into an area, clearing and holding and the people of the country then become alive with you. They inform on the bad guys. And peace comes to the country, and prosperity.

That's what's happening in Iraq. And it wasn't a tactic.

LEHRER: Let me see...

OBAMA: Jim, Jim, this is a big...

MCCAIN: It was a stratagem. And that same strategy will be employed in Afghanistan by this great general. And Senator Obama, who after promising not to vote to cut off funds for the troops, did the incredible thing of voting to cut off the funds for the troops in Iraq and Afghanistan.

OBAMA: Jim, there are a whole bunch of things we have got to answer. First of all, let's talk about this troop funding issue because John always brings this up. Senator McCain cut -- Senator McCain opposed funding for troops in legislation that had a timetable, because he didn't believe in the timetable.

I opposed funding a mission that had no timetable, and was open-ended, giving a blank check to George Bush. We had a difference on the timetable. We didn't have a difference on whether or not we're going to be funding troops.

We had a legitimate difference and I absolutely understand the difference between tactics and strategy. And the strategic question that the president has to ask is: not whether or not we're employing a particular approach in the country once we have made the decision to be there.

The question is: Was this wise?

(END VIDEO CLIP)

KING: CNN Baghdad correspondent, Michael Ware knows up close, sometimes, too up close just what it was like in the Iraq war zone. He's been covering Iraq for years, even before the battle breaks out and he joins us to help us with a sort of a reality check.

Listening to that last night, I was struck by two things, stubborn, in the sense that Obama refuses to give the surge almost any credit for what's happening, and over-simplistic perhaps, we were talking about how McCain says the surge is the end-all, be-all sometimes.

Let's start with Obama. Listening to him talk about the situation in Iraq, put it into context, reality?

MICHALE WARE, CNN BAGHDAD CORRESPONDENT: Well, we've heard Senator Obama in the past acknowledge that there's been great success over the past year or so. And that is indisputable. Yet, we also hear Senator Obama point to underlying problems. That we're really not addressing what is beneath this success. Now, he didn't go into that last night, but that is his position. Now, last night would have been the best platform...

KING: A missed opportunity.

WARE: ... to take it to the next step because he identified in another part of the debate that the great winner of the war in Iraq, the one interest that remained stronger is Iran. And the surge doesn't address the Iranian issue. And we're waiting to hear Senator Obama tell us how he would address the Iranian issue.

Some of the most senior American diplomats in Baghdad said the greatest winner in the last six years is, indeed, Iran. General David Petraeus said that the president of Iraq is an Iranian agent of influence.

Now, when it comes to Senator McCain, I fear he's doing himself a disservice. This strike (ph) short-hand of the surge, the surge, the surge. Technically, that's 30,000 combat troops. I'd love to hear Senator McCain tell us what he thinks the surge really is, because it involved buying off the insurgency, building U.S. militias, having accommodations with the anti-American cleric, Muqtada al-Sadr. A whole range of things and therein lies the complexity.

So, all of the dumbing (ph) it down to, the surge, the surge, and some throwaway glib phrase, Senator McCain, by definition, is not addressing the real underlying problem. But neither is Senator Obama.

KING: And that debate about whether it was right to go to war, whether it's the surge or it's more complicated, you said that's a rearview mirror debate.

WARE: Yes.

KING: Let's look forward a little bit. Because of the progress in Iraq, I don't want to call it a success, you can if you want, you were there every day, I'm not an expert. But because of where we are now compared to where we were a year or 18 months ago, the path for an exit strategy for either one of these men, I assume, is clearer. Are they that far apart now? At the beginning of the campaign, they were worlds apart. But because of where the United States is now and the political situation in Iraq, President Bush is bringing troops home.

WARE: Right.

KING: And both of these men will bring troops home, perhaps, at a slightly different pace. WARE: They are on it (ph) right. But certainly, Senator McCain now perhaps can see a light at the end of the tunnel. I mean, we'll take (INAUDIBLE), he can bring the troops home tomorrow if you're ready to pay the price. The government that America sponsored in the elections and the election has sponsored and created, is much more closely- aligned to Tehran than it is to Washington.

And America has 100,000 Sunni allies on the U.S. government payroll that is now handing over to the Shia-dominated government. That government hates these American allies and those American allies hate the Shia government. But that's America's insurance policy. That's America's stake in Iraq going forward.

And neither candidate has addressed what they're going to do about America's future in Iraq after the troops leave.

KING: And we will have more about that, especially the connection with Iran with Michael as we continue a little bit later.

But now, let's stick with the politics of Iraq. McCain and Obama disagreeing deeply over this issue. So, how might it play out with the voters?

Back with us: Democratic strategist and CNN political contributor, Donna Brazile, Republican strategist and CNN senior contributor, Ed Rollins, and our senior analyst, Gloria Borger.

Gloria, why can't the Democrats, including their candidate for president, say -- you know what, we're all against the surge, it is not the end all, be all, it hasn't fixed everything, but it's been a lot better than we thought it would be?

BORGER: Good question. And we've been asking this since the primaries, right, John? Because these candidates during the primaries could not say that the surge was working. And so, this is something that Obama now carries with him into the general election.

And I think, quite honestly, it's a problem for him. It's a real problem for him because if he could say the surge is working but here's why, it's because of the troops, it's because of the Anbar awakening, it's because of a lot of reasons, I think that would give him a little more credibility when he talks about Iraq.

KING: One of the great dichotomies in this campaign, that is -- even though we know the American people want the war over and want the troops to come home -- a month or two months, if you ask them in a poll, who would best handle Iraq, John McCain often came out on top. But among those who watched the debate, here's what they told us -- 52 percent said that Barack Obama would better handle Iraq; 47 percent John McCain. That's relatively close, within the margin of error.

But if Obama came out on top of the Iraq argument in the debate last night, what does that tell you about the case John McCain is making to the American people?

ROLLINS: Well, obviously, John McCain should own this issue because he certainly has been a critical player all the way through here, both the supporters of the surge and what have you, and no one knows more about what's going on in our military than he does. But I think part of it is the way he articulates and part of it, once again, is that he's the cold warrior.

It's kind of a lecture like you don't know what's going on there, as opposed to here's what has happened and here's what we have -- has to happen in the future. And I think Barack basically did a very effective job of communicating his point of view. The country doesn't want us to be there and the critical thing is: how do we get out.

KING: Has Obama made the transition in the primaries being most anti- war, was the defining thing among the Democratic primary, you have to get to the left if you want to use that term of the war of Hillary Clinton and everybody else. And Barack Obama did that. And he's the nominee, in part, because of that.

Has he transitioned to the point whereas a potential commander-in- chief, people don't see him as too soft, an argument used against your party many times in the past?

BRAZILE: I think Senator Obama understood last night that the country is ready to have a sensible plan to withdraw our troops. He also, last night, mentioned that we're spending $10 billion a month. The Iraqis now have $79 billion in oil reserves. It's time that they step up the surge. The purpose of the surge was to give the Iraqi government time to bring about a reconciliation.

We learned just recently and John McCain mentioned it, that the Iraqis will now hold elections in January, well, they were scheduled in October. So, there are still some internal problems that the surge has not resolved.

KING: At the beginning of this campaign, way, way back, if we can remember back that far, right through the (INAUDIBLE), back when we had crowded fields in both primaries, Iraq, especially, in the Democratic side, but Iraq is an issue on the scale of one to 10, who's up there, seven, eight, nine, or 10, if you were in the Democratic primaries.

Where is it now as we go into the final month of this election campaign?

BORGER: It's really receded. And it's anywhere from way down on the bottom to kind of in the middle. What's interesting to me as we talk about Iraq and this debate over the surge, is that the American people believed the surge has worked. But that hasn't affected the way they feel about the war and that's why that's not helping John McCain more. Because they still think we need to get out of Iraq, even though we've had some success.

ROLLINS: The economy is taking all the oxygen (ph) out of everything.

BORGER: Yes.

ROLLINS: That's all we're going to talk about the next six weeks. We're not going to talk about this war again.

BRAZILE: But as long as we're spending more than $1 trillion to fight this war and fight both wars in Afghanistan as well as Iraq, the American people will become even more concerned about how we're spending our tax dollars.

KING: From Iraq to up next, to talk more -- not to talk. Under what conditions would Obama and McCain sit down, say, with the president of Iran? And do you agree with them?

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP, JULY 23, 2007)

ANDERSON COOPER, CNN ANCHOR: Let's go to another YouTube video.

(BEGIN VIDEO CLIP, YOUTUBE)

STEPHEN SORTA, DIAMOND BAR, CA.: In 1982, Anwar Sadat traveled to Israel, a trip that resulted in a peace agreement that's lasted ever since. In the spirit of that type of bold leadership, would you be willing to meet separately without precondition during the first year of your administration in Washington or anywhere else, with the leaders of Iran, Syria, Venezuela, Cuba and North Korea in order to bridge that gap that divides our countries?

(END VIDEO CLIP)

COOPER: I'd like to point out that Stephen is in the crowd tonight -- Senator Obama?

OBAMA: I would. And the reason is this -- that the notion that somehow not talking to countries is punishment to them, which has been the guiding diplomatic principal of this administration, is ridiculous.

(END VIDEO CLIP)

KING: That exchange is from last year's CNN/YouTube Democratic presidential debate. As you heard back then, Senator Obama said, as president, he would meet with leaders of rogue nations without preconditions.

During Friday's debate, Senator McCain lashed out at that suggestion and that's when the fireworks began over foreign policy, especially what to do about Iran. We'll talk about it in a moment. First what the candidates said.

(BEGIN VIDEO CLIP)

OBAMA: We're also going to have to, I believe, engage in tough direct diplomacy with Iran. And this is the major difference I have the Senator McCain. This notion that by not talking to people we're punishing them has not worked. It has not worked in the Iran. It has not worked in North Korea. In each instance, our efforts of isolation have actually accelerated their efforts to get nuclear weapons, that will change when I'm president of the United States.

LEHRER: Senator, what about talking?

MCCAIN: Well, Senator Obama twice said in debates that he would sit down with Ahmadinejad, Chavez, and Raul Castro, without precondition, without precondition. Now, here is Ahmadinejad -- who is now in New York talking the extermination of the state of Israel, of wiping Israel off the map -- and we're going to sit down without precondition, across the table, to legitimize and gave a propaganda platform to a person that is espousing the extermination of the state of Israel and, therefore, then giving them more credence in the world arena and, therefore, saying, they 'd probably been doing the right thing because you will sit down across the table from them, and that will legitimatize their illegal behavior.

The point is, that throughout history, whether it be Ronald Reagan, who wouldn't sit down with Brezhnev, Andropov or Chernenko until Gorbachev was ready with glasnost and perestroika. Or whether it be Nixon's trap to China which was preceded by Henry Kissinger, many times before he went.

Look, I'll sit down with anybody. But there's got to be preconditions. And those preconditions would apply that we wouldn't legitimatize with a face-to-face meeting, a person like Ahmadinejad. Now, Senator Obama said, without precondition.

OBAMA: So let's talk about this. First of all, Ahmadinejad is not the most powerful person in Iran. So, he may not be the right person to talk to. But I reserve the right, as president of the United States, to meet with anybody at a time and place of my choosing, if I think it's going to keep America safe.

And I'm glad that Senator McCain brought up the history, the bipartisan history of us engaging in direct diplomacy.

Senator McCain mentioned Henry Kissinger, who's one of his advisers, who, along with five recent secretaries of state, just said that we should meet with Iran, guess what, without precondition.

This is one of your own advisers. Understand what this means without preconditions. It doesn't mean you invite them over for tea one day. What it means is that we don't do what we've been doing, which is to say, until you agree to do exactly what we say, we won't have direct contacts with you.

There's a difference between preconditions and preparation. Of course, we've got to do preparation starting with low-level diplomatic talks, and it may not work because Iran is a rogue regime.

But I will point out that I was called naive when I suggested that we need to look at exploring contacts with Iran and you know what? President Bush recently sent a senior ambassador, Bill Burns, to participate in talks with the Europeans around the issue of nuclear weapons.

Again, it may not work but if it doesn't work, then we have strengthened our ability to form alliances to impose the tough sanctions that Senator McCain just mentioned. And when we haven't done it, as in North Korea -- let me just take one more example.

In North Korea, we cut off talks. They're a member of the axis of evil. We can't deal with them. And you know what happened? They went -- they quadrupled their nuclear capacity. They tested nukes, they tested missiles.

They pulled out of the nonproliferation agreements and they sent nuclear secrets potentially to countries like Syria.

When we reengage -- because again the Bush administration reversed course on this -- then we have at least made some progress...

(END VIDEO CLIP)

JOHN KING, CNN CHIEF NATIONAL CORRESPONDENT: From its nuclear program to its threats against Israel to its role in Iraq, Iran is an enormous challenge facing the next president.

Both Senator McCain and Obama invite diplomacy. But McCain talks more of the stick, while Obama also suggests maybe some carrots.

Who has the better approach?

With us again, CNN Baghdad correspondent Michael Ware.

What is the better approach right now? The Bush administration has tried some low level talks to little or no avail. What next was the best course for the next U.S. administration?

MICHAEL WARE, CNN BAGHDAD CORRESPONDENT: Well, bottom line, unfortunately, I'm not sure America has any other choice but at least to continue pursuing engagement.

You don't have a stick. I mean, Iran is sitting back and it is dominating much of the political and even the battlefield in Iraq. If we now see its hand over in Afghanistan, again, with the Taliban opposing the U.S. interest, we see it sponsoring Hezbollah and Lebanon, which thumped the Israelis just a couple of years ago.

What's sanctions do you have? An engagement is already underway and certainly not president to president. But the U.S. ambassador in Baghdad has met twice with his Iranian counterpart and there's countless back channel communications through the Iraqis.

Now don't forget the Iraqi government has created mainly a political parties and they are created in Iran, sponsored by Iran or with long- standing associations with Iran so there's already a lot of talk going on.

KING: A lot of talk going on, but is there anything coming from the talks? Is there anything that you see on the table that tells you that Ahmadinejad actually wants to do business, whether the issue is Iraq or the nuclear program, or maybe the bigger question, is he powerful enough? Is he the one to do business with? WARE: Well, Ahmadinejad is one of a number of players that -- there are others behind the scenes so much more important, I would argue.

Either way all the issues you just mentioned are one and the same. Iranian involvement in Iraq, apart from regional, you know, shifting of the deck chair, is really about nuclear weapons. That's how it's pressuring America.

The last 12 months Iranian-backed militias have been killing more U.S. troops than al Qaeda or the Sunni insurgency put together. That's an Iranian form of dialogue. They're putting pressure on the U.S. and you want to pull the combat troops out? Leave that vacuum?

In one way or another you're going to have to cut a deal with Iran. Now their price is nuke, something that America can't afford to give so you're going to have to find some kind of middle ground. You really have little other choice.

KING: Very sober assessment.

WARE: I know I'm sorry.

KING: Very sober assessment, but the reality from our Michael Ware.

But when it comes to foreign policy both candidates appear to think the United States has lost much of its stature in the world. That's about all they agree on, though. Senator McCain has the experience on the issue but did Senator Obama hold his own on this?

Joining me here at the table for this hour, Republican strategist, Alex Castellanos, CNN contributor, Gloria Borger, these two with us are senior political analysts, and from Washington, D.C., the premiere Democratic pollster, Peter Hart.

And, Peter, I want to begin this conversation with you because going into the first debate we had this conversation many times. Is he safe? Is he ready? For the big question facing Barack Obama, who by a narrow margin, I think, we could call the front-runner or the candidate with the advantage in this race -- did he meet the first test?

PETER HART, DEMOCRATIC POLLSTER: I think he had a good night and I do think he met the first test, because for most voters what they said is, I don't know him that well. And he knew the names. He knew the numbers. He responded strongly. And he went directly to the voters.

I thought he did a really good job in terms of the foreign policy. I think that John McCain, that is his strength. But I think a neutral situation for Obama is exceptionally good night and I thought he did very, very well.

And I think he met his objective which was, can he be trusted? Does he know what's going on? And is he tough enough? And I think it was all about internal metal and did he have that strong metal inside of him? And I think voters said, probably, yes. KING: Probably yes? Alex Castellanos, says a Republican? Do you agree with Peter's assessment? And if you do, how troublesome does that spell -- how much trouble does that spell for your party and its candidate going into the final month?

ALEX CASTELLANOS, REPUBLICAN CONSULTANT: I think -- I think Obama scored well enough last night to pass the test. And that test is, can you see this man sitting in the big chair?

I think a lot of Republicans are going to say McCain won. Democrats are going to say that Obama won. But if you're an independent looking at this election and have a young untested candidate, he was cool under fire last night. He didn't get rattled. He -- he obviously wasn't as well versed with foreign policy as John McCain was who'd lived it.

At times Obama looked a little bit like he was, you know, trying to remember his flash card, that kind of thing, but he was more than confident. I thought he passed the test.

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: And I think the tie goes to the front-runner. Alex and I disagree a little about this because I think Obama had something to prove in this debate. He proved it.

I don't think he looked like he forgot his flash cards but the tie, if it's a tie -- and I don't think it was -- but to say it's a tie, then -- you've got to give it to Obama.

KING: Peter is it less of a concern now than it might have been six months ago before the front pages were dominated by melt down on Wall Street? Whether we'll have a $700 billion bailout? Or when people pull that curtain behind them on election day, does it still matter, the commander in chief test?

HART: Oh the commander in chief test is very much there but the difference is we've moved to a domestic economy and I -- domestic issues. And I think Ed Rollins is absolutely right when he said that's where the interest is going to be.

And I think for John McCain, the biggest challenge he has since this campaign is to divorce himself George W. Bush especially on the economic situation and I'm not sure that he's going to be able to do so.

KING: Up next, Obama's defensive. Linking his challenger with the president. We heard a lot of it, quite a bit during the debate. Did he deliver? That's ahead.

(COMMERCIAL BREAK)

DON LEMON, CNN ANCHOR: Hello, everyone. I'm Don Lemon at the CNN world headquarters. Here's what's happening right now.

A team of negotiators from both parties and both Houses of Congress are hard at work on Capitol Hill right now trying to reach a deal on the proposed $700 billion financial rescue plan. There is talk that a deal is possible as soon as tonight. Live pictures of the building where those people are working now to try to save the U.S. from financial ruin. Both parties agree there is still a lot of work to do.

We will follow. You don't want to tune out for that.

Well, we have some breaking news as it concerns the weather here. Our Jackie Jeras working it for us in the CNN severe weather center -- Jacqui?

JACQUI JERAS, CNN METEOROLOGIST: Well, we're watching Kyle get closer to New England at this time. About 250 miles away or so, moving very quickly on up to the north.

It's a hurricane but it's fighting some very strong southwesterly winds so it's kind of a lopsided storm a little bit that said, it's still holding up there at 75 miles per hour. We've been getting a lot of rain across the northeast throughout the day today.

A lot of flash flooding. Two to four inches has been common across parts of New England with a lot of low level cloudiness, making for some really miserable conditions here.

That said, the wind is not very strong just yet but they should be arriving by tomorrow afternoon and could be gusting between 50 and 60 miles an hour. Landfall happening late tomorrow night. Probably somewhere near the U.S./Canadian border -- Don?

LEMON: Jackie, we will follow, thank you very much.

It is one of the deadliest attacks in Syria in years and this the -- is the aftermath. Look at that. A massive car bomb has killed at least 17 people and wounded about a dozen others.

Government officials call it a terrorist attack. But there has been no claim of responsibility. The Syrian news agency says the car was parked with more than 400 pounds of explosives.

Actor Paul Newman has died of cancer at the age of 83. Newman's blue- eyed good looks and anti-establishment persona made him a major movie star for nearly half a century. He won a best actor Oscar for "The Color of Money" along with two honorary Oscars for his overall career and charitable work.

Survivor includes Newman's wife of 50 years, actress Joanne Woodward.

I'm Don Lemon. Because negotiators are working through the night on the bailout plan we will, too. Make sure you tune in for a very special edition of the "CNN NEWSROOM" live at midnight Eastern, because there could be a deal. They say there could be one soon.

Now back to "THE NEXT PRESIDENT."

(COMMERCIAL BREAK) KING: As much as Senator McCain tries to distance himself from President Bush, Senator kept on tying the two together -- McCain and Bush, McCain and Bush -- during the debate.

Again and again, Senator Obama paired McCain with the unpopular Republican president on a wide range of issues. It's a tactic he's used during the entire campaign but this time he was standing right next to McCain. Watch.

(BEGIN VIDEO CLIP)

OBAMA: You are neglecting people who are really struggling right now. I think that is a continuation of the last eight years and we cannot afford another four.

This is a final verdict on eight years of failed economic policies promoted by George Bush, supported by Senator McCain. John mentioned me being wildly liberal. Mostly that's just me opposing George Bush's wrong headed policies.

One of the things that I intend to do as president is to restore America's standing in the world. We are less respected now than we were eight years ago or even four years ago.

(END VIDEO CLIP)

KING: So what's the strategy behind and the impact about Obama's Bush-McCain manager.

Joining me again, CNN's Dana Bash and Jessica Yellin.

Jessica, I assume from the Obama perspective this is the McCain-Bush- Palin ticket, or I'm not sure I have the order right. Then maybe it's the Bush-McCain-Palin ticket.

Take me behind the scenes. Obviously the president is unpopular. He is the party in power. Obama wants to be changed. We understand the surface argument. Take us deeper as to why they think this is so important.

JESSICA YELLIN, CNN CONGRESSIONAL CORRESPONDENT: They want as much as possible to connect John McCain to the suffering people are feeling at their kitchen tables when they're trying to pay their food bills, their health care bills, and they blame George Bush for that.

They want to say John McCain is going to continue that. This is a preview of what we're going to see at the next presidential debate -- Barack Obama trying to tie McCain as much as possible to the failed Bush economic policies, as they call it.

But there's another key point. Barack Obama has to also connect directly as a human being to sort of what we call real people. He did it better last night, continually mentioning the middle class, but not as well as we heard Hillary Clinton do during the primaries, and that's where he needs to improve by the next debate. KING: Well, Dana, John McCain tried to get away from the Bush label. Before you talk about their strategy, let's listen a little bit to Senator McCain essentially saying whoa, whoa, whoa, I'm not George Bush.

(BEGIN VIDEO CLIP)

SEN. JOHN MCCAIN (R), PRESIDENTIAL CANDIDATE: I honestly don't believe that Senator Obama has the knowledge or experience and has made the wrong judgments in a number of areas including his initial reaction to Russian aggression in Georgia, to his -- we've seen the stubbornness before in this administration, to cling to a belief that, somehow, the surge has not succeeded and failing to acknowledge that he was wrong about the surge.

(END VIDEO CLIP)

KING: So Dana, not only does John McCain say, I oppose the president on Iraq. I fought him on climate change, I fought him on other issues. But he says, if you're looking for someone who's acting like George W. Bush, it's Barack Obama.

He won't even acknowledge the surge is a success. Stubborn, stubborn, stubborn. He's more like Bush than I am. Why?

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT: That was a remarkable moment that John McCain was not only trying to distance himself from George Bush, but trying to tie Obama's sensibilities and his approach and, basically, his character to George W. Bush.

Why is that important? I mean Jessica laid it out. But I can't tell you how critical McCain advisers think it is to make sure that doesn't stick -- the connection to George Bush.

You heard him try as hard as he could to tick off some of the areas throughout the last seven years where he has differed from George Bush. He talks about the issue of torture, of spending, of Guantanamo Bay. He almost forgot the Iraq war and the difference that they had with their strategy over the past couple of years.

But, you know, I just have very quick anecdote. During the Republican convention, John McCain didn't mention the name George Bush once but he did say the president once. Inside the campaign they were doing dial testing focus groups.

Even when he just said the president, everything plummeted. Everybody didn't want to hear it -- Democrats, Republicans, independents -- there is nothing more important for John McCain than to make sure that charge from Barack Obama doesn't stick.

KING: Dana Bash, Jessica Yellin, on the trail, back with you in a little bit.

Up next the Russian dilemma. How will McCain and Obama deal with Vladimir Putin? He's no longer the president of Russia but still the power. Stay with us. (COMMERCIAL BREAK)

KING: Now to Russia. It's been in the headlines over its recent military action in the former Soviet Republic of Georgia.

But do McCain and Obama consider Russia an enemy or potential partner of the United States? Here's how they addressed the question.

(BEGIN VIDEO CLIP)

OBAMA: I think that given what's happened over the last several weeks and months, our entire Russian approach has to be evaluated because a resurgent and very aggressive Russia is a threat to the peace and stability of the region.

Their actions in Georgia were unacceptable. Now we also can't return to a Cold War posture with respect to Russia. It's important that we recognize there are going to be some areas of common interest. One is nuclear proliferation.

They have not only 15,000 nuclear war heads but they got enough to make another 40,000 and some of those loose nukes could fall into the hands of al Qaeda. This is an area where I've led on the Senate working with a Republican ranking member of the Foreign Relations Committee, Dick Lugar, to deal with the proliferation of the loose nuclear weapons.

That's an area where we're going to have to work with Russia but we have to have a president who's clear that you don't deal with Russia based on staring into his eyes and seeing his soul.

You deal with Russia based on, what are your -- what are the national security interests of the United States of America and we have to recognize that the way they've been behaving lately demands a sharp response from the international community and our allies.

JIM LEHRER, MODERATOR: Two minutes on Russia, Senator McCain?

MCCAIN: Well, I was interested in Senator Obama's reaction to the Russian aggression against Georgia. His first statement was both sides ought to show restraint. Again, a little bit of naivete there.

He doesn't understand that Russia committed serious aggression against Georgia. And Russia is now become a nation fueled by petrol dollars, that he's basically a KGB apparatchik run government.

I looked into Mr. Putin's eyes and I saw three letters, a K, a G, and a B, and their aggression in Georgia is not acceptable behavior. I don't believe we're going to go back to the Cold War. I am sure that that will not happen.

But I do believe that we need to bolster our friends and allies and that wasn't just about a problem between Georgia and Russia. It had everything to do with energy. There's a pipeline that runs from the Caspian through Georgia through Turkey. And, of course, we know that the Russians control other sources of energy into Europe, which they have used from time to time. It's not accidental that the presence of Latvia, Estonia, Lithuania, Poland and Ukraine flew to Georgia, flew to Tbilisi, where I have spent significant amount of time with a great young president, Mikhail Saakashvili, and they showed solidarity with them but also, they are very concerned about the Russian threats to regain their status of the old Russian Empire.

Now, I think the Russians ought to understand that we will support -- we, the United States, will support the inclusion of Georgia and Ukraine and the natural process inclusion into NATO.

We also want to make it very clear that the Russians are in violation of their cease-fire agreement. They have stationed additional troops...

(END VIDEO CLIP)

KING: Senator McCain, once again there, claiming Senator Obama doesn't have the experience on the world stage, saying right out he's naive in his view.

Let's talk over the potential political consequence of the Russia situation with our political panel. Joining me again, Republican consultant, Alex Castellanos, CNN senior political analyst, Gloria Borger, and in Washington, D.C., the Democratic pollster, Peter Hart.

Alex, let me start with you. This is not the days of the big bear. It's not Reagan versus Carter and the evil empire. But when John McCain is trying to make the point there that there's a Russia, Georgia conflict, that he's making the case that Obama was soft, the old traditional Republican argument against the Democrats.

His first reaction, he called it a moral equivalency, that he's soft. We need a tougher commander in chief. Did he make it?

CASTELLANOS: I thought this was one of McCain's better moments in the entire debate. He demonstrated tremendous knowledge, you know. Name dropping was not a bad thing here for John McCain. He'd been there, done that, went through the entire litany.

I think, unfortunately, it was a -- he won a victory in the wrong stadium. It's a -- if this had been about the economy and he demonstrated an answer like that he would have scored a lot more points.

Obama's strategy was probably sufficient to get him through on something like this. It's the old fighter who knows that on foreign policy my opponent has an advantage. What will I do? I'm going to clinch him. Hold him tight.

And Obama did it all night with these kinds of answers saying, "John, you're right. John, you're right," going into the clinches with McCain. But then there's the rope, Gloria, will you take the punch or use the clinch and hold? Do you think the clinch and hold here effective for Obama?

BORGER: OK, he did fine -- look, he did fine. I found John McCain a little small when he took on Obama's initial reaction on the Georgia crisis, saying that, well, you know, he just urged restraint. What about that? On both sides.

That's nothing a leader should do. Well, honestly, some people think that is what a leader should do, but I do agree that this was one of McCain's best answers because he took us around the world with him and told us, yet, again, he spent a significant amount of time there and that can work.

KING: Peter, as you grade this exchange, help me understand the context of public opinion. When the American people look at post- Putin Russia where Putin is still a power and they saw this flare up, very dangerous flare-up, do they have the awareness of the situation?

Whether it is the energy situation that Senator McCain tried to refer to or the geopolitical situation and uncertainty within Europe and the former republic state if Russia is trying to be assertive and ascendant to the American people.

Do they get it and do they care?

HART: They don't care. And when I say they don't care it's a lower issue, as Alex points out, than the economy and then the health care and energy and all of those issues.

But it is the sense of, can I trust Obama? And I thought that he held his own and I think Alex is right. He did clinch and he said, I agree with him on this. I thought it was pretty smart answer on his part.

And I would also agree that I thought that John McCain -- this was one of his best exchanges. He showed his expertise. He showed his knowledge. But in the end of the day, I think this is going to come down much more to debate two and to debate three where we get back to the domestic issues.

KING: Up next, back to the economy. Is Senator McCain out of touch with the crisis? You be the judge, when THE NEXT PRESIDENT DEBATES: ROUND ONE, continues.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

MCCAIN: You know there's been tremendous turmoil in our financial markets and Wall Street, and it is -- people are frightened by these events. Our economy, I think -- still, the fundamentals of our economy are strong but these are very, very difficult times.

(END VIDEO CLIP) KING: Senator John McCain there on the trail in Florida last week when the markets were taking a beating after the demise of Lehman Brothers. He's taking a lot of heat from Senator Obama for saying, as he did right there, that the fundamentals of the American economy are strong. And at Friday's debate, McCain tried to reverse that and show he gets it.

Watch this.

(BEGIN VIDEO CLIP)

MCCAIN: Have no doubt about the magnitude of this crisis. And we're not talking about failure of institutions on Wall Street. We're talking about failures on main street and people who will lose their jobs and their credits and their homes if we don't fix the greatest fiscal crisis probably, certainly in our time.

And I've been around a little while. We've got to fix the system. We've got fundamental problems in the system.

(END VIDEO CLIP)

KING: Much different take there for Mr. McCain on the economy at the debate. Do we call that a flip-flop? Do we call that a smart course correction?

Let's get back to the panel and get their take. Joining us again Republican consultant, Republican consultant, Alex Castellanos, CNN senior political analyst, Gloria Borger, and in Washington, D.C., the Democratic pollster, Peter Hart.

Alex, as the Republican strategist, you can make a case with the economist, look at the growth on the economy last year, look at the overall fundamentals of the economy but everybody knows it was politically foolish for John McCain to be out there saying, at this moment, the economy is fundamentally strong.

Has he fixed it?

CASTELLANOS: He -- I think there's still some fixing left to do. And you know, he wasn't trying to make the point that the -- not that everything is rosy. He's trying to lead with optimism.

One of the great advantages that I think Barack Obama has is that's JFK, Reagan, Clintonesque sense of optimism that things are going to be all right, and that's what people want in an uncertain world.

You know, the only way to connect with people on the economy is not to feel their pain. It's to show them things can get better and that was, I thought, Obama had a lot of that in his demeanor last night and McCain was a bit pessimistic.

So I thought -- I thought actually George Bush said once nobody ever bought a product that made him feel worse and I think that's one of the things you want from your leader when there's economic uncertainty. BORGER: The other thing -- about McCain was that sometimes I think he came across as this sort of green-eye shade accountant which was, OK, we're going the cut these earmarks and this, as you know, John, you hear this constantly from John McCain.

Everybody has heard that from John McCain. It's $18 billion. It's not going to solve the problem. We get it. He's going to make them famous. He's going to take that rusty old pen and veto everything.

But he sounded like an accountant more than a visionary about where you're going to take the country and that -- I think that's what people want now.

KING: Well, Peter, jump in on this, but as you do, I want to just share our numbers from our CNN poll after the debate last night.

Who would better handle the economy? Of those watching the debate, and it was a larger Democratic audience than it was a Republican audience. But of those watching, 58 percent said Obama would better handle the economy, 37 percent, John McCain.

I assume, Peter, if that number, anywhere close to that, on election day, Barack Obama is the next president of the United States.

To Gloria's point, when they're talking about the economy, Obama, McCain, they're both senators. They don't connect to people like past candidates we have seen. When they're talking -- using the words they use, the focus they use, who are they talking to?

I assume Senator McCain is trying to reach out to independents when he's talking about spending, earmarks, corruption, reform?

HART: Well, he's talking, obviously, in his area to the anger that's out there. But what happened this week has to be put in context. And I think a bit through the voters I talked to in focus groups.

And I think that John McCain was unnerving. He was erratic as he behaved this week and I think voters need to get a much better sense that he knows what he's doing and there's a comfort.

When he rushes back to Washington, announces there's going to be no debate and then shows up at the debate, I think that's -- that's difficult for people to deal with.

I think that Barack Obama, his difficulty is he's got to talk in personal terms. I thought he talked in -- on the economy too much in Washington terms. He's got to get down there and get out in the unemployment lines.

He has to get down there and talk to people about what's important. And at this stage of the game, there's a lot of work to be done for Barack Obama. But the edge is so large that they want change. They want Obama.

KING: They want change, therefore, do both of you agree -- we've short time left in this segment -- that if they both failed to communicate in those personal terms that Peter talked about, that Obama wins just because he's not Republican?

CASTELLANOS: I think the manage will go there, but both of them are going to fail because neither of them is a warm and fuzzy guy. They're not going to feel your pain. Reagan didn't, by the way, and he was a very successful president.

What Obama has got to do is make up for that with vision. McCain has to make up for that with toughness. And so we'll see whether you can make change happen -- that's McCain's argument, whether you can see change and lead people there, that's Obama's argument.

BORGER: We didn't hear the word change a lot last night. That was what's so interesting to me. They were trying to project confidence and stability. They didn't talk about change a lot.

KING: Expect we'll hear about that with more debates to come including, up next, how McCain and Obama's running mate could make an impact on election day which is days away from, perhaps, the most highly anticipated debate in our memory between Governor Sarah Palin and Senator Joe Biden.

The VP factor coming up.

(COMMERCIAL BREAK)

LEMON: OK, everyone, I'm Don Lemon at the CNN world headquarters.

Want to tell you what's happening right now as Congress works on that deal. A team of negotiators from both parties and both Houses of Congress are hard at work on Capitol Hill.

They're doing it right now and said they'll be doing it through the night. They're trying to reach a deal on a proposed $700 billion financial rescue plan.

Live pictures of the Capitol where they are burning the midnight oil. There is talk that a deal could come as early as tonight, as tonight, at any moment, but both parties agree there's still a whole lot of work to do and they are working to try to get it done.

People living on Maine's coastal islands are being urged to evacuate to the mainland ahead of Hurricane Kyle. The storm reached category 1 earlier this evening.

A video from Massachusetts shows boaters struggling to save their vessels in the high surf. Ferry service on the main coast will probably be shut down tomorrow.

Kyle could make landfall late Sunday or early Monday near the Maine/Canada border.

Actor Paul Newman has died of answer at the age of 83. Newman's blue- eyed good looks and anti-establishment persona made him a major movie star for nearly half a century. He won a best actor Oscar for "The Color of Money" along with two honorary Oscars for his overall career and charitable work. Survivors include Newman's wife of 50 years, actress Joanne Woodward.

I'm Don Lemon. Negotiators on Capitol Hill trying to work out a deal. We'll be here for a very special edition of the "CNN NEWSROOM" at midnight, at midnight. We're following every single development.

Now back to "THE NEXT PRESIDENT."

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

OBAMA: I'm very proud of my vice-presidential selection, Joe Biden, who's the chairman of the Senate Foreign Relations Committee.

MCCAIN: I have a long record and the American people know me very well and that is independent and a maverick of the Senate. And I'm happy to say that I've got a partner that's a good maverick along with me now.

(END VIDEO CLIP)

KING: Senators McCain and Obama, they're both making references to their running mates at Friday night's debate.

And of course, Governor Palin and Senator Biden will face off this Thursday in St. Louis in their one and only debate before Election Day. Each vice presidential candidate has their own strength and weaknesses that could shift things in some key battleground states.

We're back at our magic wall. To help map it out for you, and with us, again, Democratic pollster, Peter Hart, is in Washington. Hot on the trail, Dana Bash and Jessica Yellin. Still with us here in the studio, Republican strategist Alex Castellanos, and CNN political analyst, Gloria Borger.

Peter Hart, let me start with you. Looking at a map of the United States of America, we always say it comes down to the guys at the top of the ticket. But is there a place in America, a place on this map where you would make the case?

I know you're a Democrat, but does Sarah Palin helps John McCain?

HART: Without a doubt, she is a red meat candidate for the red states. She has to provide the enthusiasm, the sense of hope and optimism that the top of the ticket doesn't have. That's what she's going to be able to do.

KING: And -- then Peter, let me ask you, quickly, the down side for Sarah Palin.

HART: Well, I think the big down side is that voters just don't see her as experienced. They like her personally. They find her a mom. They her feisty, there are all kinds of good qualities.

But when you ask them, only 40 percent of American voters think that she is qualified to be president of the United States. 64 percent say that Joe Biden is qualified. That is a huge gap, and the biggest problem that she faces is that she can't make a mistake Thursday night, because if she does, it will be replayed 10,000 times and it'll take the ticket down with it.

KING: So Dana Bash, Sarah Palin preparing for this debate. Peter raises the threshold question, is she qualified to be president?

Tell us how she's preparing and then tell us how they do view this inside the McCain campaign. Where on this map do they think Sarah Palin is a huge plus?

BASH: Well, I'll start with that. First of all, in terms of the states where they were a little bit worried that they were going to lose some traditionally red states or least recently, like the state of Georgia, for example, where conservatives, people who should vote Republican, simply were not comfortable with John McCain.

They're comfortable with Sarah Palin. But also battleground states like Ohio and Pennsylvania. Obviously, they're not red states, but the red areas of those states, we so it on the trail with Sarah Palin, with John McCain. They're coming out more. They're much more excited. That's where they feel comfortable.

In terms of the preparation, it's hard to imagine them spending more time and more effort trying to prepare Sarah Palin, John. She -- starting last Thursday, she was sitting in one of those battleground states in Philadelphia in a hotel room with advisors, really hunkered down and they're trying to prepare her, obviously, for the host of issues that will come up.

And she's going to be doing that, basically, except for one planned rally right up until the day of the debate next week. They understand she didn't do very well in last week's interview with Katie Couric, and they can't afford for her to tumble on this debate.

KING: So Jessica Yellin, if you're Joe Biden preparing and the Obama team briefing him for this debate, do you come in trying to disqualify her, trying to prove to the American people on television she is no president? Or do you hope she does that herself and focus your attention elsewhere?

YELLIN: Exactly. They have to let her sink or swim on her own. For Biden, this is a natural. He knows how to debate. He knows the issues. His challenge is to be as respectful of her as he can and as disciplined as he can, and I say that not because she's a woman candidate, but because she is new to the national scene and she's perceived as struggling right now.

And he cannot seem condescending. He wants to be likeable, he needs to be likeable, so let her sink or swim on her own.

KING: Perceived to be under siege right now, Alex Castellanos. How do you take Sarah Palin out here? Put her in a place where, maybe she does need a little practice, maybe she does need to campaign on the national stage? Where do you put her and where do you maybe take advantage of that? You heard it at the convention, the Republicans trying to say the elitists are after this woman. Where do you put that to your advantage?

CASTELLANOS: I think there is one place in this country where you put Sarah Palin and that's you take her to Macomb County, Michigan. You put Sarah Palin in the working-class, Reagan Democratic suburb of Detroit and, you know, that's a place that can determine whether Republicans or Democrats carry Michigan.

Park her there, get her a snowmobile, don't let her leave, because as Michigan goes, so goes the nation. That might be the one place that Sarah Palin could swing the election.

KING: Gloria Borger, let's flip this coin. We talked about Sarah Palin, where she might help. What about Joe Biden? Where can he help?

BORGER: Well, I think Joe Biden helps in a state like Florida. Joe Biden helps in -- with Catholic voters, in Pennsylvania. He can help in Ohio. He can help in those so-called bitter rural areas, as Barack Obama once referred to them.

He is a working class guy from Scranton, Pennsylvania. We were reminded about 50 times when he got the vice presidential nod, so I think -- I think he can help Barack Obama with those middle class and blue-collar voters that he needs some help with.

KING: Peter, give us the reality check. How much does this one matter? People vote the top of the ticket, and does it matter more this year, as some people say, because Barack Obama -- he's only 47 years old and relatively new on the national stage?

John McCain is 72 years old and would be the oldest president ever elected. Does it matter more because of those dynamics?

HART: Both matter. First of all, for Joe Biden, he provides a reassurance. He knows foreign policy, he's experienced just as Dick Cheney provided a reassurance for George W. Bush in 2000.

But also, in terms of Sarah Palin, she has one problem. Voters don't see her as being qualified. And because John McCain is 72 years old, voters connect those two things. They wouldn't do it ordinarily, but the age of John McCain hurts when you look at Sarah Palin on the ticket.

KING: Well, Dana, I asked Jessica Yellin if Joe Biden is focused on Sarah Palin or on John McCain on broader issues. How does Sarah Palin approach this? Is she trying to somehow go after Joe Biden, or is this all about Barack Obama?

BASH: That's an excellent question. Honestly, I think at this point, she is -- they want to definitely make this about Barack Obama. And really, we've heard that from her in the campaign trail. You know, she almost never talks about her -- counterpart, I should say, Joe Biden, she almost always talks about Barack Obama. I can't imagine it being different with regard to the vice presidential debate, because, you know, they see -- they saw what happened when she was first picked, that Barack Obama suddenly was focused on her and many Democrats said, wait a minute, you're aiming at the wrong target here.

They understand full well their target is one person, and that's Barack Obama.

KING: Their target is Barack Obama.

Gloria Borger, to the degree that Sarah Palin has gotten so much attention, at first it helped John McCain. Peter Hart who is with us says it's perhaps now a lethal element to the campaign because of the questions about her experience when combined with McCain's age.

If we are talking about Palin -- and even Joe Biden for that matter -- after the vice presidential debate, does that hurt John McCain who needs to take command of this economy...

BORGER: Yes.

KING: ... and take command of this election?

BORGER: Absolutely. And that's why I think they're spending so much time preparing her for this debate. But I think a potential problem, John, is that you see how she didn't do well in the Katie Couric interview this past week.

She seems to have lost every bit of self-confidence that we saw at the Republican convention. I think she is being over-briefed. I think they've taken the spark out of her. I think she's so afraid to make a mistake that she becomes garbled.

And I think that's going to be a problem for her in this debate, if they don't find a way to relax this woman, get her to loosen up. And what I think she's going to do is talk about John McCain's credentials as commander in chief, and less about herself.

KING: Pretty low expectations there, Alex. Is it easy to jump over that hurdle if it is so low?

CASTELLANOS: I think, you know, debates tend to be great levelers, just the very fact that you have two candidates on the stage sparring with each other tends to make you look at them as equals.

So I think the key thing here is that both candidates are going to be debating someone who is not there. Palin is going to be debating Barack Obama. Biden is going to be debating the presidential candidate on the other side. So -- and that's the most effective thing that each of them can do.

KING: As you can see, a great deal of interest. And don't forget, the vice presidential debate Thursday night in St. Louis and you can catch it right here live on CNN.

And that does it for this CNN special. THE NEXT PRESIDENT DEBATES: ROUND ONE.

Want to thank all our guests for joining us tonight. And don't forget to join us for round two, the second presidential debate will be held Tuesday, October 7th, in Nashville, Tennessee.

I'm John King. Thanks for watching and good night.