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CNN Live Event/Special

Delaware Senator Candidates Debate

Aired October 16, 2010 - 16:00   ET

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

NANCY KARIBJANIAN, DELAWARE FIRST MEDIA, CO-MODERATOR: I'm Nancy Karibjanian, for Delaware First Media.

WOLF BLITZER, CNN ANCHOR, CO-MODERATOR: And good evening. I'm Wolf Blitzer from CNN. Thank you so much for joining us for what is certain to be one of the most widely watched events of this, the 2010 midterm election season.

KARIBJANIAN: Let's introduce the candidates. Joining us for this debate this evening, Democratic Chris Coons, welcome. And Republican Christine O'Donnell, welcome.

CHRISTINE O'DONNELL (R), DELAWARE SENATORIAL CANDIDATE: Thank you.

KARIBJANIAN: We also want to thank AARP Delaware and the American Cancer Society Cancer Action Network for their support making this debate possible.

BLITZER: And let's go through some of the rules, some of the ground rules for this 90-minute debate. It's divided into two parts. Following a two-minute opening statement from each candidate, Nancy and I will pose questions. Responses to that initial question limited to two minutes with a one-minute rebuttal from the other candidate. And then there will be an opportunity for all of us to mix it up a little bit, to get into a discussion, and follow up. That's the first hour. The first 60 minutes of this debate.

That will be followed by a 30-minute segment, during which we turn to the students here at the University of Delaware. They have questions. Responses to their questions will be limited to one minute. Each candidate will also have two minutes at the end for a closing statement.

Our live audience here in Mitchell Hall understands, we hope, that there will be no applause during tonight's debate. We want everyone to be quiet and listen and learn from these two candidates.

A coin toss determined earlier the order for this evening. We begin with two-minute opening statements from each of the candidates, and we begin with Chris Coons.

CHRIS COONS (D), DELAWARE SENATORIAL CANDIDATE: Thank you. Thank you, President Harker.

To our moderators, Wolf Blitzer, Nancy Karibjanian, and to our hosts, UD Center for Political Communications and Delaware First Media. There's a great deal at stake in this election for our state, for our families and for our country. All of us, regardless of our political leanings, recognize that Washington is broken. As I've traveled up and down the state the last nine months as a candidate listening to voters talk about the issues facing them in their daily lives, I've heard again and again their frustration with Washington and with elected officials who are putting narrow partisan agendas ahead of the good of our country and doing little to help millions of Americans out of work or on the verge of losing their homes or who are anxious about their futures.

The partisan gridlock in Washington has real implications for us in Delaware. There's more than 35,000 Delawareans still out of work and nearly 3,000 families that have faced foreclosure this year. These aren't just numbers. In Delaware, these are our neighbors. And we can't simply stand by and watch Washington ignore us or them any longer.

In this election, Delaware's voters face a clear and important choice between, on the one hand, my opponent, a candidate who wants to take our state and country back to the failed economic policies of the past, who values partisan bickering over compromise and solutions. And who I believe has extreme positions that threaten vital education programs and would abandon our commitment to our veterans.

And on the other hand, in my case, a candidate with a proven track record of balancing budgets, finding bipartisan solutions, working with Delaware's businesses large and small, helping to create jobs and spur growth.

Over the next 90 minutes, I look forward to the chance to share with you my ideas and values, Delaware values that I learned growing up in Hokesen, working here in Newark with one of Delaware's most innovative manufacturing companies and leading Delaware's second largest government.

I take seriously the idea this campaign is a job interview. And tonight's debate is about giving Delaware's voters an insight into which candidate has the experience, the values, and the ideas to best represent them and do the hard work of fixing what's broken in Washington.

Thank you.

KARIBJANIAN: Your opening statement.

O'DONNELL: Thank you.

Thank you to our hosts and for everyone being here tonight. I'm running because I'm concerned about the direction of our country. The America we knew and grew up with is being threatened in the most serious way. In just three years, we will be paying $1 billion a day on the interest alone on our national debt. The common sense men and women in this room, and all across Delaware, know this is not sustainable. Yet my opponent wants to go to Washington and rubber- stamp the failed spending bills that are coming from - that have cost us 2.5 million jobs.

This is wrong. Uncle Sam needs to be cut off.

With your vote and your support, I want to go to Washington to create jobs based on private business, not your tax dollars. I want to fight to have our nation become debt free. I want to stop the tax hikes that are coming in January. I want to reach sustainable energy independence, support the military, and strengthen the security of our homeland. I want to fight to safeguard Social Security, improve education, and protect our constitutional liberties.

And in an election year, when so much is at stake, just about every candidate says this, yet what distinguishes one candidate from another are the proposed solutions to reach these goals. I very much look forward to getting down to brass tacks with all of you over the next 90 minutes because I believe there is a clear choice in this election. A vote for my opponent will cost the average Delaware family $10,000 instantly between the January tax hikes and his vote for cap and trade.

Most of us can't afford that. If you think that government is too small and that your taxed too little, if you're ever questioned whether America is a beacon of freedom and justice, then he's your guy. But if you want a U.S. senator who will stand up to the Washington elite, who will put your interests ahead of the special interests, and make the tough decisions needed to rein in an out of control Washington, then I humbly ask you to vote O'Donnell for U.S. Senate.

Thank you.

(COMMERCIAL BREAK)

KARIBJANIAN: We're now getting into our question portion of the evening.

And I'll begin with you, Mr. Coons. Creating jobs to get America back to work clearly has to be a priority to do. Americans voted overwhelmingly for Democrats during the last election, because most felt that the Democrats would be able to fix the failing economy. Unemployment is at 9.6 percent, almost three quarters of Americans in the most recent CNN Opinion Research Corporation poll said that the economy is still in a recession.

So why should the voters of Delaware trust a Democrat this time around?

COONS: Well, Nancy, thanks for your question. I think the voters of Delaware should trust this Democrat because of my combination of experience working in the private sector and working with the private sector. Hands-on work, helping one of Delaware's most innovative companies expand and grow jobs and concrete and engaged work as county executive working with our Chamber of Commerce, our business roundtable, the Committee of 100, lots of groups who represent businesses large and small to effectively grow the economy. I've also presented as a candidate for the Senate concrete and real ideas. They're on my web site but I look forward to the chance to go over them in some detail tonight.

I would advocate for a research and development tax credit and expand our tax credit that's combined with a new manufacturing tax credit that advocates for companies that invent things here and make them here, getting an extra inventive.

I also think we need to change the crazy tax policy in Washington that gives an incentive to American companies to shut down operations here and ship jobs overseas.

There's other things I've proposed - expanding the home office tax credit, expanding a tax credit for starting a new business that employs folks within the first couple of years, fighting harder in trade policy to make sure we're not letting our trading partners take advantage of us in trade deals that were signed over previous years, doing more in investment and innovation.

At the end of the day, I think Delaware has a long tradition of inventing and manufacturing world class products. The best way for us to get out of this recession is through growth. The best way to growth is by taking advantage of the skills and resources of a world class university like this one where we're having this debate this evening and tying that to a stronger more qualified more capable workforce, giving it the resources and the energy it needs to be once again the leader in the world in creating high quality, high value manufacturing jobs.

Those are some of the ideas I look forward to discussing more this evening. Thank you.

KARIBJANIAN: Ms. O'Donnell, you have one minute for a rebuttal.

O'DONNELL: Well, first, we have to keep in mind my opponent has a history of promising not to raise taxes on the campaign trail and then breaking those promises as soon as he takes office. Unemployment here in New Castle County rose, almost doubled in the last two years under his watch as New Castle county executive.

Now, when it comes to the policies that he has said on the campaign trail, he will continue to rubber-stamp the spending policies coming from Washington. We were promised that the stimulus bill would create jobs. But instead it cost us 2.6 million jobs. We were promised that it would keep unemployment at eight percent, but instead we see unemployment at 9.7 percent. The Democrats are bragging that unemployment has leveled out, but while unemployment has leveled out, more people than ever are on food stamps and our welfare spending is higher than ever. This is not the right move. This is not a move towards real economic recovery. This is a move towards creating a culture of dependency.

I believe the best thing the government -

KARIBJANIAN: That's the time, sorry. But now we get to open it to discussion.

O'DONNELL: Great.

BLITZER: Well, what specifically, Ms. O'Donnell, would you do, specifically, to create jobs?

O'DONNELL: Well, what I think the best thing the government can do to get our economy back on real economic recovery is for - to get out of the way of the small business owner, to get out of the way of the entrepreneur. And the way you do that is to make sure these tax hikes don't come in January. You begin to roll back some of the regulation that's forced them to close their doors.

A couple of that things that I'm proposing. And number one, a temporary two-year tax holiday on the capital gains tax to give investors the money they need to reinvest in business, to permanently eliminate the death tax. That's not only an unjust bill because we've paid taxes while we saved it, but it will also create 1.5 million new jobs.

KARIBJANIAN: Let me just remind that we are in the discussion portion so you can interject here as well as we continue to discuss that point.

COONS: I'm not sure I understand what Ms. O'Donnell means when she says this is simply create ago culture of dependency and that her primary objective would be to end all the endless regulation and red tape. She denounces the Obama administration, says its done nothing to promote job growth when frankly, just a few weeks ago, a new bill that would provide expanded SBA loan capacity, $30 billion worth of new lending capability, TARP funds that have been repaid, and are being repurposed towards small and midsized banks all over the United States. Real and concrete steps are being taken.

I also frankly can't imagine where she found the numbers that unemployment doubled in just the past year under my watch. I suspect we're going to need to keep a close eye this evening on the numbers that go flying back and forth.

BLITZER: Let's ask her, where did you get those numbers?

O'DONNELL: The Department of Labor Statistics. And we'll have them on our web site by tomorrow.

But I want to point out that he said that we're not creating a culture of dependency. How would you explain what is happening when unemployment is leveled out, but more and more people are on food stamps? We've got to ask ourselves, what do we want Delawareans to be receiving, food stamps or paychecks? I say paychecks.

COONS: Obviously paychecks. We'd like to have Americans able to receive the benefits that they need to get through incredibly difficult times. But to simply denounce people as being dependent because they're applying for and receiving food stamps...

O'DONNELL: Oh, Chris, that's not fair...

COONS: ...in the worst recession in modern times...

O'DONNELL: That's not fair of you to say that.

COONS: Is frankly slandering people who are in incredibly difficult times.

O'DONNELL: That fair of you to say that, because that's not at all what I'm doing. I'm not the person who would cut the tax benefits for disabled and low-income senior citizens, as you did as county executive. But what I'm proposing is to give these tax - to make sure that the tax cuts for our Delawareans do not expire this January. You have said that you will stop the tax cuts for the so-called rich. What you fail to realize is that the so-called rich are the small business owner, the dry-cleaner down the street, the pizza shop owner who makes $300,000 before they pay their four employees, before they feed their own family...

BLITZER: I'll have you respond.

COONS: Ms. O'Donnell, we're going to try to have a conversation here this evening, rather than just a diatribe if we possibly could. I think it would be helpful for us to have an exchange of ideas and let each of us take turns. So thank you for moderating, Wolf.

I think it's important to look closely at some of the things Ms. O'Donnell's thrown out on her new web site. Most of them are untrue. Some of them are just flat-out lies. Some of them are mischaracterizations. Some of them are just factually untrue. So, I'm not going to stop every single time there's something she throws out that I disagree with or I think is factually untrue.

But let me just say at the outset, that much of what you've put out, much of how you've characterized my record is incorrect. And if we simply sit here this evening and say, that's not true, we're not going to make much progress.

BLITZER: Well, do you support keeping the Bush tax cuts for all Americans or only for those making under $250,000 a year?

COONS: I support extending the Bush tax cuts for the overwhelming majority of Americans. I don't think we should draw an arbitrary line at $250,000. But the value that I will apply as deciding how much to extend, whether it goes up to $1 million or $2 million, or $5 million is that we've got a tough choice to make. Every increased tax cut, every extension that's given, is going to cost, it's going to increase the deficit, it adds to the debt.

And here's the primary value I would apply in deciding whether to extend all of the Bush tax cuts and for how long. I think we should do those tax cuts that have the best chance of getting our economy going again...

BLITZER: All right...

KARIBJANIAN: We're out of time though for this discussion.

BLITZER: But you're going to have an opportunity to get back into this discussion because this is issue number one - jobs, jobs, jobs.

(COMMERCIAL BREAK)

BLITZER: I want to get into the deficit right now. You've made the point that the national debt is exploding, the budget deficit is exploding right now. I want some specific meaningful cuts, if you're elected a senator from Delaware, what would you cut in the federal budget? And don't just say waste, fraud and abuse, because everybody says that. What would you cut specifically?

O'DONNELL: That's a great question because first of all we have got to tackle the deficit and the debt because our deficit is almost becoming equal to our national GDP. When your deficit - a country's deficit equals your GDP, that's when your currency collapses, your market collapses. We've got to take drastic measures.

BLITZER: So what would you cut?

O'DONNELL: First of all, cancel the unspent stimulus bill. Second of all, put a freeze on non-discretionary - on discretionary spending, put a hiring freeze on nonsecurity personnel. And then, of course, when we're talking about cutting government spending, we've got to talk about waste, fraud and abuse.

A recent report came out said that we spent over $1 billion in Medicaid waste, fraud and abuse. We're talking about pharmacies billing for prescriptions given to dead people. We're talking about home health care companies billing for patients who were in the hospital.

Senator Coburn recently put out a report called schoolhouse pork that disclosed millions of dollars that were supposed to go to education funding that instead went to special favors.

Now, special favors are something that my opponent knows very much about because he created 12 contingency funds so that he could pay out favors to special interest groups. The courts forced him to close 11 of them. But of the one that remained open, he paid $53,000 in a men's fashion show. He paid another - more than $50,000, to appease liberal special interest groups.

At a time when he brags about balancing the budget by raising our taxes, cutting policemen pay, this is how he chooses to spend our tax dollars. We've got to ask, do we want to send this gentleman to Washington, D.C.? I would say no.

He's a career politician who has proven he knows how to play the I'll scratch your back, you scratch mine game.

BLITZER: You have a minute to respond.

COONS: There's so much to respond to Wolf, a minute may not be enough. Let me get back to the focus of the question, which is what would you do to tackle the deficit and the debt? I think we have some very large challenges in front of us. The overwhelming majority of federal spending is made up by defense spending, Medicare, Medicaid, Social Security and interest on the debt.

While the president has proposed, and I would seriously consider supporting, a freeze on non defense discretionary spending for three years, which would achieve significant reductions. I've also identified on my web site a series of reductions that I would support. Some of them are in agricultural price supports. Some of them are in federal office space, for example, or hiring. And several of them are in defense programs.

Defense acquisition that the Pentagon itself has already said they no longer need. The C-17 program, for example, or the second engine for the F-35. There's a variety of platforms and programs that I think we can simply do away with. As we invest in making our defense and our military more modern, more flexible, more responsive to the real threats we face in the modern world. And as we continue to achieve some savings through the BRAC program and other things that have shown a real capacity to save.

KARIBJANIAN: Let's open the discussion on correcting some of the financial issues here by talking about some of your own personal financial problems. And most people know about it by now, including an IRS lien that was for about $12,000 in taxes and penalties from '05. There was the 2008 mortgage default judgment on your home. You just received your bachelor degree, as you said, because it took a decade to pay off the tuition.

The question, then is, how can voters rely upon your thoughts on how to manage the deficit if you're having such personal financial issues of your own?

O'DONNELL: Well, first of all, that IRS tax lien, the IRS already admitted that it was a computer error and my opponent should not be bringing that up, because as I've gone up and down the campaign trail, I've discovered that there are thousands of Delawareans who have faced the same thing. An IRS mistake has caused them greatly, which is all the more reason why we need to reform the IRS, not put them in control of our health care.

Second of all, you mentioned education. I don't have a trust fund. I didn't come from a privileged, sheltered background as my opponent says he did...

KARIBJANIAN: Let's stay to the issue of paying bills and managing finances.

O'DONNELL: I am. I paid for my own college education. I also have a graduate fellowship in constitutional government from the Claremont Institute. I know how hard it is to earn and keep a dollar. And one of the reasons why the Delawareans should be able to trust me is because when I did in this economy, I worked for non-profit groups. Non-profit groups were the first to have been hurt. When I fell upon difficult times, I made the sacrifices needed to set things right. I sold my house. And I sold a lot of my possessions in order to pay of my personal debt and to become in a stronger position.

I have worked hard in order to get to the position that I am. So I can relate to the thousands of Delaware families that are suffering right now. And I'm stronger for it. I made it through to the other side. And that's where - leadership doesn't count in whether or not you fall, it counts in whether or not you've gotten up and that's what I've done.

KARIBJANIAN: Let's just remember we're in the discussion portion so if you have anything you want to address within that response, on things that have been said on this topic thus far, go for it.

COONS: Well Nancy, I frankly think that we need to focus in this debate this evening and in the campaign, not on personal financial difficulties or background issues but really on the issues in front of us, the things that Delawareans are concerned about - how do we tackle the deficit and debt? How do we get Delaware back to work? There's been lots of discussion in the national media about things my opponent has said or done that I frankly think are a distraction from the core issues that Delawareans ask about - ask both of us about.

O'DONNELL: You're just jealous that you weren't -

COONS: What would you do in Washington?

O'DONNELL: - on "Saturday Night Live."

COONS: I'm - I'm dying to see who's going to play me, Christine.

BLITZER: Well, let's - on a serious note, let's get through some of the accusations that she'd made and - and we'll give you a chance to respond.

COONS: Please.

BLITZER: That -

COONS: On the idea that somehow I was the one responsible for being sued for creating 11, 12 -- she's confusing me with my predecessor, Tom Gordon.

BLITZER: What we're talking about is County Executive -

COONS: Yes.

BLITZER: - New Castle County Executive. You raised property taxes, according to reports, three times, 25 percent hike in the last fiscal year. You proposed new taxes on hotels, paramedic services, even 911 calls from cell phones. Is that true?

COONS: No. It's not true that we proposed a tax on the calls to the 911 center. In any case -

O'DONNELL: It's not true. COONS: - research into that would reveal that. It's difficult, it's complicated, but I'll take - Ill take a -

BLITZER: ell, explain your record on - on axes. id you increase taxes as the county executive?

COONS: Wolf, let me walk you through, for a moment, what's happened, because one of the attacks my opponent's made repeatedly is that I've driven the county to the edge of bankruptcy. That's on her newest attack. Nothing could be the further from the truth.

Today, New Castle County has a surplus. When I became executive in '05, it had a deficit. I have worked hard over six years to defend a very significant reserve, which has made it possible for us to continue to have a Triple-A bond rating. Out of 3,000 - roughly 3,000 counties in America, roughly 30 have a Triple-A bond rating, and I reached a bipartisan solution -

O'DONNELL: It says stop.

COONS: - that cut more in spending than was raised in taxes.

BLITZER: All right, a quick response and then we'll move to the next -

O'DONNELL: You've been criticized for saying that you brought the county to Triple A bond rating. You inherited that good rating. And how would you justify cutting the tax exception for low income seniors and disabled seniors, cutting our policeman pay when you wastefully spent so much money on appeasing the special interest groups?

You simply can't justify that. That is a career politician. That is cronyism. We don't need any more of that in Washington.

BLITZER: Very quickly, because we got to move to the next series of questions, do you want to respond to that?

COONS: There's a lot to respond to in that.

BLITZER: Do it in 30 seconds.

COONS: That's going to be difficult, Wolf.

But I'll tell you that I'm proud of my record as New Castle County Executive. The very hard choices that had to be made to clean up the government - every time you get a bond rating, you earned a bond rating.

Ms. O'Donnell's not familiar with how bond ratings work. Each time you go to the bond market, you are re-rated. Moody's, in their letter of rating just two weeks ago, said that it was because of the conservative fiscal policies of my administration that we have re- earned a Triple A bond rating from all three agencies.

(COMMERCIAL BREAK) BLITZER: Let's move on to the next series of questions on national security, foreign policy, right now. A 100,000 American men and women are serving in the military in Afghanistan right now. The president of Afghanistan, Hamid Karzai, has now acknowledged he's in direct talks with the Taliban leadership, wants to create what he calls a peace council.

Here's the question and it goes to Mr. Coons. Would you support a negotiated settlement in Afghanistan that includes Taliban representation, would that be acceptable to you, a deal between Hamid Karzai and the Taliban?

COONS: Wolf, I'm concerned about the security of our troops in the field and about honoring the service and the sacrifice of our veterans. The war in Afghanistan is the war of the two that we've been engaged in, Iraq and Afghanistan, that I think was justified by a direct attack on the United States, the Taliban, who were offering harbor to Al Qaeda, who were authors of the 9/11 attack. And I think in our 10th year now on the ground in Afghanistan, we have to look hard at whether we're continuing to contribute to America's security by having 100,000 troops on the ground.

I would support a negotiation resolution to the war that allowed us to leave security and intelligence assets in place, and that allowed us the opportunity to reengage should the Taliban take control again, or allow Al Qaeda to reemerge as a real threat to the region, or to the United States.

We've spent $1.3 trillion in Iraq and Afghanistan. It has significantly contributed to our debt. We have lost more than 5,000 American servicemen and women. And I've got folks, who I am personally close to, who are now deployed for their third and fourth tour. We have asked a lot of our men and women in the field. They have delivered brilliantly. But, frankly, the mission has exceed the scope that I think we could initially reasonably expect of them.

I am far more concerned about the threats to our security, posed by an unstable Pakistan, posed by Iran, and posed by an endless war in a country where we're trying to build a nation. Where there really hasn't been one in modern times.

BLITZER: You have one minute to respond.

O'DONNELL: Well, I would ask him if he's serious about making sure that Afghanistan doesn't become a safe haven for terrorists, why on the campaign trail he has said that he supports this random time withdrawal? We have to support our men and women who are risking their lives, many of them have already given their lives over there, a random withdrawal that he has said he supports, will simply embolden the terrorists to come after us even more, saying I've chased away the superpower.

When we withdraw from Iraq, we need to make sure that there are benchmarks in place. Those benchmarks are making sure there's a government that -- a representative government over there, that serves the needs of the people, and that can defend themselves. When we reached these benchmarks, that's when we withdraw.

BLITZER: You want to respond to that?

COONS: She said withdraw from Iraq, I suspect you meant withdraw from Afghanistan?--

O'DONNELL: No, from Afghanistan. Did I say Iraq? I'm sorry. Thank you, Chris. I meant Afghanistan.

COONS: If we're talking about Afghanistan, frankly I come from a family of veterans. I come from a family that has dedicated a lot to the service of our nation. And I wear a flag pin every day to remind me of the young man who grew up next door to me, who was killed in Iraq in December of 2005. I never take lightly the enormous sacrifices that our servicemen and women have made now and that we ask them to continue making. I don't know how long is too long, but 10 years strikes me as awfully long.

I question whether your standard, whether your principles give us any hope of winding up this war on any reasonable timeline. Because frankly, the government of Hamid Karzai has proven itself to be largely corrupt and be, frankly, ineffective at establishing control over the whole country. We are doing our best. We have dedicated trillions, hundreds of billions of dollars to this conflict. And I'm, frankly, deeply concerned it's a conflict without a reasonable end in sight. There are times in history when the best way to --

O'DONNELL: Saying that you are--

COONS: --to honor the sacrifice of service men and women is to come up with a plan to responsibly wind down a conflict.

O'DONNELL: And that plan should be based on those benchmarks. The benchmarks that means that we have had success. Again, you are hollow rhetoric when you say your top priority is the concern for the safety of us on the homeland, if you seriously support this random time withdrawal. Because, again, all we're going to do is embolden the terrorists to think they have more power than they do. I would ask you, a couple of times, whether it's the tax cuts or even here in this kind of veiled -- you've gone back and forth in what you just said in Afghanistan. Do you support the president, or don't you support the president? With the tax cuts you are saying you don't support the president? Are you going to tell him that when he comes--.

COONS: Ms. O'Donnell, let's stay focused on the issue in front of us, which is Afghanistan.

O'DONNELL: You're jumping around.

COONS: You suggested gauzy benchmarks.

No, we're staying focused on the issue of Afghanistan, rather than jumping to other issues.

O'DONNELL: And you've jumped around. You said that security-- .

NANCY KARIBJANIAN, MODERATOR: Let's let Mr. Coons finish his point.

COONS: The core issue here is what reasonable prospect do you have for these gauzy benchmarks and timelines you suggest to ever actually result in a withdrawal? In Iraq, there was a modern nation, there was a central government, there was infrastructure in place. In Afghanistan, there hasn't been a nation in decades. And so despite our 10 years of incredible effort, we are not succeeding in building a nation. As you put it, if the benchmark is self-governance, stability, security, we had a decent shot at that in Iraq.

(CROSS TALK)

O'DONNELL: Let's remember when we were fighting the Soviets over there in Afghanistan, in the '80s and '90s, we did not finish the job. So now we have a responsibility to finish the job. If you're going to make these politically correct statements that it's costing us too much money, you are threatening the security of our homeland.

KARIBJANIAN: We're about to wrap up this topic. Let's just get there real quickly and ask, yes or no answer. Is this nation more secure than it was under President Bush? Yes or no?

COONS: Yes.

O'DONNELL: No.

KARIBJANIAN: Today, yes or no.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

(BEGIN VIDEOTAPE)

KARIBJANIAN: We'll move on to our next topic and this question goes to Ms. O'Donnell.

O'DONNELL: Can I say why? We have had more terrorists attacks on our homeland-

(CROSS TALK)

KARIBJANIAN: No, we really-sorry, but we do need to move on.

I know that we've said that the statements out in the national media, the "Saturday Night Live" skits are distractions, I appreciate that. But to the voter in Delaware, it is the message that they are receiving. So we would be remiss if we did not address this issue.

So the comments that you've made in the past, which are in your own words because they're on the videotape, have become the fodder for the late night TV shows. You even released an ad that opened up by saying "I am not a witch." And a local newspaper columnist said, that the comments that you have been seen to be making, make Delawareans cringe. So what do you say to voters who want the change, but are uncomfortable by these remarks? O'DONNELL: This election cycle should not be about comments I made on a comedy show over a decade and a half ago. This election cycle should be about what is important to the people of Delaware? How we're going to get real jobs back to Delaware? How we're going to get our economy back on track? How we're going to protect our senior citizens and safeguard our Social Security? These are the issues the people of Delaware are concerned about.

You know, as Wolf, you can attest, I have not welcomed this media attention. You've been asking for an interview for quite a long time. My priority has been getting back to the Delaware voters, meeting as many voters, going to as many community forums as possible so that we can counter these things.

My opponent has said that the statements that we made in our 20s should be off the table, and after he made that statement, days later- he started running ads in his own campaign materials he's going back on his word, using those statements to misrepresent my character.

So, again, I thank you for the opportunity for the Delaware voters to get to know who I am and what I'm all about. Because what I can assure them is while I made statements, my faith has matured over the years, but regardless of my personal faith, when I go down to Washington, D.C., it is the Constitution that I will defend, and it is by the Constitution that I will make all of my decisions. And that will be the standard bearer for every piece of legislation I will vote on.

KARIBJANIAN: Mr. Coons, you have a one-minute rebuttal.

COONS: I was surprised to see in the newspaper in an interview a profile of both of us. Ms. O'Donnell's statement, pretty similar to what you just heard from here. That she would not have her faith be a central driver of her decisions if elected. I'm interested if we can explore further your suggestion that the Constitution would be your guide. Because I'm interested in hearing whether it's the Constitution as passed by the founders, the Constitution of 1920, 1930, the Constitution of 1975, the Constitution of today?

Because to me, protecting a woman's right to choose, protecting reproductive freedom and making sure we've got on the record Mr. O'Donnell's views on things like prayer, abortion, evolution, is important. These aren't just random statements on some late-night TV show. These are relevant to her service to the United States Senate. What sort of judges she would confirm. What sort of issues she would take up.

I'm someone who stands firmly behind the Constitution as it stands today. I respect the steri decisis (ph), the decided cases, the case law that governs the United States.

KARIBJANIAN: All right. But let's go to the issue of faith and politics. Because you were a student pastor at Yale. You also said in an interview once, that you thought you would either end up a preacher, a professor, or a politician. You've occasionally been a guest speaker at some of the churches here in our community, Baptist churches, Presbyterian churches, to name a few. How much of an influence does this faith in your life have on your politics?

COONS: Faith is a central part of how my wife and I are raising our three children, why we decide to do the community service and the outreach that we do. But ours is a faith that we think is a general motivation towards public service, towards trying to create a community that's more tolerant, inclusive and just, and towards the sort of forgiveness, healing and reconciliation that we think is the central message of our faith.

But I also think as someone who has been elected 10 years, I've learned to reach a balance, where my private faith, the aspects of my faith that are religious doctrine, don't influence the decisions I've made for the public in my 10 years in county office.

BLITZER: Let's give you a chance to respond to some of the things she said, because in a television appearance back in 1998, on Bill Maher's show, you said evolution is a myth. Do you believe evolution is a myth?

O'DONNELL: I believe that the local -- I was talking about what a local school taught, and that should be taught -- that should be decided on the local community. Please let me respond to what he just said.

BLITZER: We'll let you respond, but answer the question. Do you believe evolution is a myth?

O'DONNELL: Local schools should make that decision. I made that remark based on --

BLITZER: What do you believe?

KARIBJANIAN: What do you believe?

O'DONNELL: What I believe is irrelevant.

BLITZER: Why is it irrelevant? Voters want to know what you--.

O'DONNELL: What I will support in Washington, D.C., is the ability for the local school system to decide what is taught in their classrooms. And what I was talking about on that show was a classroom that was not allowed to teach creationism as an equal theory as evolution. That is against their Constitutional rights and that is an overreaching arm of the government.

But please allow me, at least the full minute, to respond to what he said, because he said these statements that we made should be taken into consideration, when casting your vote. So then I would be remiss not to bring up the fact that my opponent has recently said that it was studying under a Marxist professor that made him become a Democrat.

So when you look at his position on things like raising taxes, which is one of the tenants of Marxism, not supporting eliminating the death tax, which is a tenant of Marxism, I would argue that there are more people who support my Catholic faith than his Marxist beliefs. KARIBJANIAN: Well, let's let him clarify-

O'DONNELL: And I am using his own words.

KARIBJANIAN: We're going to clarify that.

BLITZER: Because a lot of people remember, because they've learned in the last few weeks, you did once describe yourself when you were in college, a long time ago, as a bearded Marxist.

COONS: Great question, Wolf. I hope folk also read the article. It's an article that I wrote as a senior the day of our commencement speech. And the title and the content of that clearly makes it obvious that it was a joke. There was a group of folks who I had shared a room with, my roommates junior year, who were in the Young Republican Club. And who thought when I returned from Kenya, and registered as a Democrat, that doing so was proof I had gone all the way over to the far left end. So they jokingly called me a bearded Marxist. If you take five minutes and read the article, it's clear on the face of it, it was a joke.

Despite that, my opponent and lots of folks on the right wing media have endlessly spun this. I am not now, nor have I ever been, anything but a clean-shaven capitalist.

(LAUGHTER)

O'DONNELL: Well, I would stand to disagree, because first of all, if you're saying what I said on a comedy show is relevant to this election, then absolutely, you writing an article, forget the bearded Marxist comment, you writing an article saying you learned your beliefs from a articulate, intelligent Marxist professor. And that is what made you become a Democrat. That should send chills up the spine of every Delaware voter, because then if you compare, that statement to your policy-

COONS: If it were accurate, if it were true, I'd agree. But it is not accurate, it is not true.

O'DONNELL: But that is what you said that on MSNBC, just a few weeks ago.

KARIBJANIAN: We'll have to let the last word.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

(BEGIN VIDEOTAPE)

KARIBJANIAN: This goes to you first, Mr. Coons, and this is the issue of education in our country. And in many public school districts all across America, as they're trying to get an accountability in the classroom, it is very difficult to dismiss an underperforming teacher because of the stringent contracts that have been negotiated with the individual school districts and teacher unions. So do you feel that teacher unions are too powerful?

COONS: Nancy, one of the things that I've complimented, both Delaware's teachers and Delaware's governor for, is their remarkable progress under the "Race to the Top" program.

One of, I think, the best parts of the Obama-Biden's administration's progress on education. I like both the process and the outcome. They set a very high bar, they offered a federal pot of money that was available for those states that were willing to make significant changes. In Delaware and Tennessee, where two states made that progress.

Delaware's teacher's union, the DSEA, came to the table and with the leadership of Governor Markell, and made significant changes. Things that a lot of folks predicted they wouldn't do, to embrace charters and make them more powerful. To make it possible for schools that are underperforming to be shut down or restructured. And to change a system so that teacher compensation could be tied towards improvement by students in the classroom.

I think our teachers deserve our support and I think our teachers have a long tradition of contributing significantly, not just to educating our children, but to building a stronger and better community. My own mother and grandmother were school teachers. And I deeply respect the hard work that they do. Earlier today, I was at Eisenberg (ph) school in New Castle, because this is National School Lunch Week.

The work that our teachers do, the work that's done in early education from Head Start to full-day kindergarten, through K through 12 education, the work that's done here and other great public universities around the state and country, is critical to laying the ground work for our future.

I have no problem with recognizing that the folks who do the hard work, the teachers and the para professionals are entitled to a good standard of living, are entitled to live a life where they have health care, they have a pension and they have job security.

I do think there are issues we have to tackle and I think "Race to the Top" made significant progress in making sure our schools are performing as best they can.

BLITZER: You have a minute to respond.

O'DONNELL: If you notice, he didn't answer the question as to whether or not he thought the teachers unions were too powerful and it's probably because he got their endorsement.

I would say that what we need to do, especially here in Delaware where we spend so much money on education, it ends up going to the six figure salaries of our bureaucrats, and our superintendents, not to the teachers in the classroom. It's appalling in a state where we spend so much federal and state dollars on education, good teachers who want to get extra materials, have to do so out of their pocket. I have met many teachers. I've sat down with them and talked to them about their concerns with "Race for the Top" and whether they're Democrat or Republican, a lot of them express that we are not spending our education dollars appropriately.

We are not helping the classroom, and what's going to happen when this Race to the Top funding dries up? We have a broken system, especially in Wilmington, where I live. We have an extremely high dropout rate. Throwing more money on a broken system is not going to work. Instead what we need to do is sit down and have conversations with the teachers, not the unions, about what they need us to do to help them in their classrooms.

BLITZER: Over the years, a number of conservatives have proposed eliminating the Department of Education in Washington. Do you support eliminating the Department of Education?

O'DONNELL: I don't think that we need to go to that drastic of a step, but as I said, Senator Coburn has released a report that shows where millions of dollars in Department of Education money has been abused. That is the kind of stuff we have to stop. We also have to make sure the money we are putting into education does go to the classroom and make them more effective.

That's something that we're ignoring every time there's a problem, we just throw more money on it to appease the special interest groups. We're not getting to the root of the problem and that's what we need to do start getting to the root of the problem, which means talking to the teachers. And not only that, putting the power back to the parents over where they send their children to school.

BLITZER: In a recent survey of 30 industrialized countries, the United States ranked 25th in math, 21st in science, Finland was first in math. South Korea was first in science. Specifically what would you do to make the United States number one once again in math and science?

COONS: Great question. And as someone who spent 20 years working with a nonprofit foundation, The I Have A Dream Foundation, that raises money from private individuals and helps provide scholarships for students, for teachers, and for a college education.

I've been hands-on and engaged with some of the toughest schools in America and some teachers who are significantly under-supported by their districts and who needed additional resources to deliver on the promise of an effective education. I think there's a significant role, though, for the federal government in providing financial support and encouragement.

Scholarships for those teachers in STA, and science and technology, and engineering and math, we need a new generation of teachers who are fully prepared and fully qualified to engage their students in a classroom, to use the latest teaching tools and media, to teach to the standards that No Child Left Behind established and need to be modernized, and made more flexible and responsive. And we frankly need to use collaborative learning techniques.

KARIBJANIAN: I'm sorry, but we're time keeping here. BLITZER: I'll give you a very quick chance to respond. What would you do specifically to make the United States number one?

O'DONNELL: Again, what I would say to improve our education, we have to empower the teachers to do what they need to do to be more effective. They're the ones on the first line of defense, they have the most influence over our students. But we also have to empower the parents. So I support charter schools and I support student vouchers, or school vouchers, so that it gives parents, regardless of income, regardless of status, an opportunity for their students to have a shot at a great education until our public schools do improve.

(END VIDEOTAPE)

(COMMERCIAL BREAK)

(BEGIN VIDEOTAPE)

BLITZER: Let's switch gears and talk about health care, which is such an important issue to millions and millions of Americans right now.

Under the new health care law that was recently signed into law by the president, children now can stay on their parent's insurance policies until the age of 26. People can no longer be denied coverage for preexisting conditions. Insurers, the big insurance companies, are prohibited from rescinding coverage if a customer becomes sick, and they can't impose any life-time limits on essential benefits, like hospital stays or expensive treatments.

You say you want to repeal all of that?

O'DONNELL: Well, first of all, no one is disputing that our health care system before Obama-care didn't need reform. Those are very important things that are part of insurance reform, not health care reform. In the course of the public debate over health care reform, we've begun to confuse coverage with care. Our goal should be to make health care more affordable. Even with Obama care, our most vulnerable in Delaware are still left uninsured and still left without access to quality health care. When we passed Obama care, we were promised that it would make more people insured. Well, recent reports say that it's not.

It's actually causing businesses to drop their policies because compliance standards are so high. Our laws, especially when it comes to health care, should not force businesses to break our laws. Second of all, we were promised that more people -- that health care costs would be lowered. It hasn't. It has increased health care costs, according to recent reports. So what I want to do is to fight to fully repeal that so we can enact real reform. And that real reform would include allowing policy portability when you change jobs, allowing Delawareans to get policies across state lines. Right now we only have three options. That's not right. And I would also fight for some sort of tort reform that allowed doctors to not have to worry and practice medicine to prepare for the courtroom as opposed to the examination room. But at the same time, this tort reform has to protect those patients who are victims of true medical malpractice. BLITZER: You have one minute to respond.

COONS: So much to say. I support the implementation of the Affordable Care Act. I think it made significant advances and you outlined many of them. But there's additional investments in the bill to make sure that there's breadth of coverage to rural areas, through the Health Services Corps, by recruiting and training a whole new generation of doctors and nurses, by expanding support for community health centers. And by also improving the efficiency of our health care system. It makes a land mark investment of $350 million over a decade to try and fight waste, fraud and abuse and increase those savings and there were strategic investments and electronic medical systems that would allow electronic medical records and to reduce injuries to patients, mistaken diagnosis and mistaken treatments.

All of these in combination I think argue for extending, perfecting and implementing this land mark bill. It's not perfect, there are problems with it. But I think rather than turning it back repealing and going for another year or two of endless partisan bickering, this was a critical piece of legislation. Not a pretty process that passed it. But I would stand for it and implement it responsibly.

KARIBJANIAN: Well, we're now into the part of the discussion on it. So, let me just ask you the issue was brought up about malpractice reform. And Democrats are often accused of being too close to trial lawyers and Republicans say that's why that there has not been the opportunity for reform in this area and why it was not included in the health care bill. If you were elected, would you work to amend that bill to include malpractice reform?

COONS: I think it is critical that folks in this country be able to stand up to and take on powerful interests and where individuals are harmed, that they're able to go into court and seek to redress, whether they're harmed by someone who misled them in a securities investment, a product that they purchased that hurt them, because it wasn't designed or delivered right or a medical procedure that went horribly wrong. I don't support putting caps on liability, because I frankly think in our current system, it is only the threat of a significant recovery that allows protection for consumers, for patients, for investors. I frankly think that's an important part of the American legal system. I do think as I just mentioned, there's significant advances in this bill that allow us to make health care safer, stronger, more transparent and if I've got a major concern about this bill, it's that we're going to reduce costs without squelching innovation. Delaware and this county has made...

KARIBJANIAN: It is discussion.

O'DONNELL: It is discussion. OK, that's what I was trying to -- OK, first of all, you say that you're concerned about reducing costs but reports have showed that this health care bill has caused costs to skyrocket. Second of all, you say that...

COONS: I don't know what reports you're reading. I haven't seen reports that document that. O'DONNELL: ... it's partisan bickering, but one out of four Democrats have gone on record saying that they oppose Obama care, they realized that we made a bad mistake. And what this bill does is it gives a massive control over health care.

COONS: And three out of four Democrats do support it. It does not give massive control...

O'DONNELL: Uncle Sam has no business coming in the examination room...

COONS: ...to Uncle Sam over health care.

O'DONNELL: ...coming between you and your doctor. And that's exactly what this bill does.

COONS: Christine, give some concrete example of how -- that's a great slogan. You toss it around everywhere you go. But how does this bill actually put Uncle Sam in the examination room between doctors and patients?

O'DONNELL: It dictates what kind of...

COONS: And if so, why did the organization that fights for and represents America's nurses, America's seniors, America's hospitals, and America's doctors, all endorse and support this bill?

O'DONNELL: And many of those branches on the state level, including here in Delaware, have said that we don't support what the national office has done. It gives the government the ability to say...

COONS: That's not true.

O'DONNELL: ...what kind of treatment a doctor can and can't do, what kind it will fund. It forces businesses to have to comply to these standards where many businesses, especially here in Delaware, have said that they can't afford to, and it's cheaper to pay the non- compliance.

COONS: Well, Ms. O'Donnell, the state Chamber of Commerce...

O'DONNELL: And it has also cut -- this health care bill has cut Medicare.

KARIBJANIAN: Let's get this point out because we're down into the last 30 seconds of this discussion.

COONS: I was just going to say, the state Chamber of Commerce and Christiana Care hosted a debate earlier today. I was sorry you chose not to join us. It would have been great to hear the response of the physicians and the nurses and the hospital administrators to your suggesting that they didn't support a bill they lobbied for.

(CROSSTALK)

BLITZER: I want to be precise on this specific health care- related issue. You oppose the government mandating that everyone must purchase health insurance, is that right?

O'DONNELL: Yes, because we're confusing coverage with care. Our goal needs to be to make health care affordable.

BLITZER: All right. Well, here's the question. Let's say someone decides not to purchase health insurance, makes that conscientious decision, even though this person can afford to buy health insurance, but decided he doesn't want to. This person gets critically ill, is rushed to an emergency room. Should we, people who pay for health insurance, provide him or her with that kind of treatment, or should we kick them out of the emergency room, said, you made a decision, you're not going to get this kind of treatment?

O'DONNELL: If we do the things that I've said that will help to address -- that I'm proposing, that will help to address the issue of health care, then that person can afford to buy a catastrophic-only policy from across state lines. They'll be able...

BLITZER: Well, what if the person doesn't want to buy it?

O'DONNELL: Well, then we have to address that.

BLITZER: Who should take care of that person in an emergency?

O'DONNELL: We have to address it.

BLITZER: Would we, all of us tax-payers...

O'DONNELL: We have to -- no, we have to...

BLITZER: ... have to pay for that person?

O'DONNELL: Anything that they do when they have another bill that they can't pay, make them pay it. Hold them accountable for that.

KARIBJANIAN: Before or after they get care?

O'DONNELL: But right now, right now -- well, that's up to the hospital. But right now we're forcing them to. We're forcing them that they have to give care to illegal aliens. So this is something that we're already doing. What I'm proposing, you're also talking about a very small hypothetical using scare tactics to make people support this health care bill. What I'm proposing in the health care reforms that I'm proposing will help address those situation and help alleviate those situations.

BLITZER: Not just a small number...

O'DONNELL: Well, nobody should be forced to pay for anyone else's health care, and that's what Obama-care is doing.

COONS: And that's what's happening today. Before the health care reform bill passed, all of us who have health insurance, who have health coverage have been bearing the costs, paying the freight for those who don't have insurance and don't have coverage. They're getting health care through emergency rooms now. That's partly why small businesses, employers like New Castle County have faced double digit increases in our insurance costs year after year and year because that's how we provide care now, it's inefficient, it's inhumane and it's not effective.

(COMMERCIAL BREAK)

BLITZER: Let's move on to immigration right now. And this question will be from Mr. Coons. A pathway to citizenship for illegal immigrants. You support that, right?

COONS: No. I support a pathway to being here legally. And let me take a moment -- was that your whole question?

BLITZER: The question is, what is your position on a pathway to citizenship for illegal immigrants?

COONS: We've got roughly 12 million illegal immigrants in the United States today. This is a huge problem. And immigration is a federal responsibility. And I think we should look to the federal government to step up and fix it. The federal government has failed states like Arizona, like Delaware, like many others. But we need to recognize the situation we're in. There are whole industries that rely on the labor of those who are here illegally. And there is a long tradition of failing to deliver the border security that our country needs. The current administration has stepped up and invested millions of dollars in additional troops and additional services, additional support at the border.

My path forward on immigration would be, strengthen the borders, make it much tougher for folks to come here illegally and increase the penalties when they do. Second, hold employers accountable, particularly those who routinely employ folks who are here illegally by giving them real ID that can work, that is much more difficult to counterfeit and then holding them accountable if they repeatedly violate that by employing those who are here illegally. And then allow those who are here illegally and do not commit further crimes to come out of the shadows if they will pay taxes, learn English, pay a fine, say I committed a crime and pay a fine and go to the back of the line behind those who applied to come here legally.

I would give them a path towards legal residence. I think there's more they'd have to do to ever earn citizenship. I respect the tradition of those who go and serve our nation overseas, for example, being offered a chance at citizenship. But in my view, the pathway I'm suggesting is one towards legal residence. I want to see us focus our resources, law enforcement resources on finding and deporting those who pose a real threat to our community. As somehow responsible for a County Police Department, I've seen over and over instances where neighborhoods are threatened by people who are here illegally and where the ICE does not have the resources to deport them when we deliver them to them. That should be our top priority.

O'DONNELL: Again, he's back tracking on things that he had said earlier on the campaign trail. And I would ask you when you say that you support border enforcement, this administration recently stopped the efforts to put a virtual fence on our border. When Barack Obama is standing with you on a campaign trail this Friday, are you going to tell him that you disagree with him on his immigration reform efforts? I believe, however, that securing our borders should be our first priority before we get into any discussion of whether we're going to get Social Security benefits to illegal aliens.

America is a magnet for those all over the country who do believe -- or all over the world, who do believe that America does stand as a beacon of hope and justice for the world, and therefore, I support a legal pathway to those who are coming over here, especially for political asylum, to seek a better life than they do in our country. And to reward those who break our laws is to cheat those who honor them. And this is not a message that our federal government should be sending.

KARIBJANIAN: OK. Let's go into the discussion portion of it. Because you say that you agreed to the pathway to citizenship...

O'DONNELL: For legal.

KARIBJANIAN: But you don't want to provide amnesty.

O'DONNELL: I don't want to provide amnesty...

KARIBJANIAN: How can you do one without the other?

O'DONNELL: Because what I'm saying is we have to get rid of all the bureaucratic messes that make the legal pathway difficult. But when someone willingly breaks our laws, that sends a message that, don't worry about the laws that we've set up, don't worry about those who are on long waiting lists for political asylum, break our laws and we'll grant you these benefits. It's sending the wrong message. It's economically hurting us. And it's also a national security issue.

KARIBJANIAN: It's discussion.

COONS: Ms. O'Donnell patently mischaracterizes her own position.

(CROSSTALK)

O'DONNELL: I do support responsible guest worker programs. And that's the difference.

COONS: If you can reconcile all those comments, you're an even more talented reporter than I think you are Nancy. One of the challenges we face is getting past the endless bickering and the partisan divide on this. Senator John McCain was someone who, before this election cycle, had been a real advocate for working with the business community, working with Democrats in Congress to find a path forward. As the years and years have rolled by, the number of folks who are here illegally and who pose real threats to our community continue to grow and we are not taking the actions we need to take to separate those who are willing to pay a fine, to accept responsibility for coming here illegally and begin paying taxes and contributing to our community and the benefits they are earning. I would rather have us begin to provide a path so that those who are here illegally all stand up and take responsibility for that or are deported. That way we can make progress.

O'DONNELL: Wow, he just took a hard-line position. Again, I would ask you, are you going to tell President Obama that, that you disagree with him and you think that illegal aliens should be deported. But we have to keep in mind that (video gap) increased the problem. So we've got to address the issue of securing our borders. And this is something the President Obama's administration stopped this year. We've got to secure our borders first and then begin the discussion on guest worker programs and how to eliminate some of the bureaucracies that keep the legal pathway to citizenship so difficult.

(COMMERCIAL BREAK)

BLITZER: I just want to clarify one thing on the national security front, on China, which is a huge issue right now. In 2006, and correct me if I'm wrong, you said that China has, quote, "a carefully thought out and strategic plan to take over America. And if they pretend to be our friend, it's because they've got something up their sleeve." You also said, "you wish you weren't privy to some of the classified information I am privy to." I'd like, if possible, for you to clarify what you meant.

O'DONNELL: Well, first of all, I was talking about when I was working with the humanitarian group that was going to China. We are given some security briefs about China's position with some potentially hostile nations and some security threats that my clients would be facing. But we do have to look at China very seriously because we own so -- they own so much of our debt, it prohibits a lot of decisions that we need to make in regard to our foreign policy. Number one is Iran with nuclear weapons. China stands in a big way there. These gasoline sanctions that we have are not enforced as strictly as they could be, because we have allies like France and Italy participating in the gasoline embargo, but then China comes in and swoops up all that business.

We need to be putting sanctions on those Chinese companies, because right now when it comes -- Iran getting nuclear weapons is our biggest threat to our national security. And when we go to China and we say, please stop these companies, they probably smirk, because we're not economically in a position to really hold them to that. China could be a bigger ally with us in North Korea, but they're not. They're not putting the pressure on North Korea that they could. So first of all, we have got to tackle that national debt. We've got to stop these things like these reckless spending bills coming from Washington that only contribute to further our national debt, because it is putting our national security at issue.

BLITZER: But on a specific quote that you said that China has a plan to take over America, you know about this plan?

O'DONNELL: Well, they misquoted me at the time, I believe. But look at what's going on. Right now, monetarily, China could take us up over monetarily before they could militarily.

BLITZER: You want to quickly respond, because I know that we want to get to the students' questions? COONS: It's hard for me to respond effectively, Wolf, to all the different issues that my opponent has raised in previous statements, and I'll just let that stand. I don't have any classified information about China or its plans, but what I think we really need to focus on in this debate, on this particular question, is the steady degradation of our security posture in the Pacific Rim. The Australian navy engaged in joint exercises with the Chinese and specifically excluded us recently. A dramatic shift in the Australian policy.

And as the Chinese have become economically stronger, they are seeking to become militarily stronger. They're pushing the envelope on issues from Taiwan to trade to intellectual property. It is a profound threat, not just to the vitality of our economy and our innovation and our manufacturing businesses, but also to our safety and security, to have widespread counterfeiting of everything from pharmaceuticals to aircraft parts, to garments, going on in China without our standing up and fighting against it...

KARIBJANIAN: (INAUDIBLE) out of time.

COONS: ... in trade war.

O'DONNELL: Are you saying...

KARIBJANIAN: We're out of time at this particular point.

O'DONNELL: Are you saying that China has a plot to take over America?

KARIBJANIAN: We're going to close out this conversation and move on to the students' questions because we do want to involve the University of Delaware students. And first up, we have a question from a student who brings us the issue of "Don't Ask, Don't Tell."

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: I was wondering if you're planning to (INAUDIBLE) the issue of "Don't Ask, Don't Tell" and its possible repeal.

(END VIDEO CLIP)

KARIBJANIAN: Mr. Coons, your response? One minute.

COONS: I would move swiftly as a senator to repeal "Don't Ask, Don't Tell." I think it is discrimination, plain and simple. I've met with and spoken to veterans here in Delaware who've served our nation honorably for decades, several with top-secret clearances, but who could do so only at the expense of denying who they were and the relationships that they wanted to have. In my view, we should be making progress in this country towards recognizing the full range of humane experience, and repealing "Don't Ask, Don't Tell" to me is an important next step in the civil rights movement.

O'DONNELL: A federal judge recently ruled that we had to overturn "Don't Ask, Don't Tell." There are a couple of things we need to say about that. First of all, judges should not be legislating from the bench. Second of all, it's up to the military to set the policy that the military believes is in the best interests of unit cohesiveness and military readiness. The military already regulates personal behavior in that it does not allow affairs to go on within your -- your chain of command. It doesn't allow, if you're married, to have an adulterous affair within the military. So the military already regulates personal behavior because it feels that it is in the best interests of our military readiness. I don't think that Congress should be forcing a social agenda onto our military. I think we should leave that to the military to decide.

(COMMERCIAL BREAK)

BLITZER: We have another student question on the issue of embryonic stem cell research, and this goes first to Mr. Coons.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: My question is, what are your views on the federal allocation of funds used for stem cell research?

(END VIDEO CLIP)

COONS: I would support stem cell research, and I think...

BLITZER: We're talking about embryonic stem cell research.

COONS: Correct. I would support federal funding for medical research that includes embryonic stem cell research. I think there are critical advances that are being made and can be made in addressing some of the most difficult diseases that affect millions of Americans, and I frankly think if it is possible to do so, we ought to be investing and making progress in this critical area of research.

O'DONNELL: I think if we took an intellectually honest look at the research that's been put out there, you will see that there is incredible advances with adult stem cell research, not as much with embryonic stem cell research, because that is where this went on in the private sector. That is where investors would be putting their money.

Second of all, the government, the federal government, should not be in the business of creating life, simply to destroy it. And when it comes to the issue of so-called medical waste, I would point to a program called the Snowflake Babies, where they have had incredible success adopting these human embryos that are going to be discarded for medical waste. Where they have given millions oh, I'm sorry- hundreds and potentially thousands of infertile couples the opportunity to have babies. It is the Snowflake program, it is a wonderful program and I suggest everyone take a look at it.

KARIBJANIAN: Our next student question brings us the issue of abortion.

(BEGIN VIDEO CLIP)

CHELSEA MOSER, UNIVERSITY OF DELAWARE STUDENT: What is your stance on abortion, including in cases of rape and incest. (END VIDEO CLIP)

BLITZER: It's for you.

O'DONNELL: I believe that there has been a profound loss of respect for the dignity of human life, and that is reflected in a lot of our policies, whether it is cutting taxes exemptions for disabled, low- income citizens in New Castle County, or with abortion. I respect the human dignity on all levels, the unrepeatable precious human dignity on all levels. And my opponent and others will use the scare tactic about rape and incest when that is less than one percent of all abortions performed in America.

KARIBIJANIAN: Mr. Coons?

COONS: I strongly support a woman's right to choose. It is settled constitutional law. It is an important part of our nation and its freedoms. I personally am opposed to abortion, but I don't think it's my place to put that view on women. I think abortion should be safe, legal and rare.

BLILTZER: Let's get into some of these issues and we go back and get more student questions.

On the issue of gays serving openly in the United States military, almost all the NATO allies allow gays to serve openly in the military. Israel, which has a fine military, as you know, allows gays to serve openly in the military. Why specifically do you believe gays should not be allowed to serve openly in our military?

O'DONNELL: Because it's a military policy our military set forth. It's the same thing as I said in my remarks about adultery not being allowed in the military. It's a military policy that they regulate because they believe that is in the best interest of unit cohesiveness and our effective military.

WOLF: So if the chairman of the Joint Chief of Staffs says he believes gays should be allowed to serve in the military, would that be good enough for you?

O'DONNELL: If the four heads -- if the heads of all four branches of the military said that, then it would be up to them, not me as a U.S. Senator to impose my social agenda, whether it's for or against Don't Ask, Don't Tell.

WOLF: What about that? What if the chairman of the Army, the Navy, the Air Force and the Marine Corps, their respected chairman of the services said, we'll do whatever the commander in chief tells us to do, but we don't think it's a good idea because of these issues that Ms. O'Donnell raises, unit cohesion and those other issues, what would you say then?

COONS: One of my real heroes is Harry Truman. Harry Truman made a very difficult decision to compel the racial integration of the United States armed forces at a point when most of the generals said, for exactly the same reasons, unit cohesion, performance on the battlefield, we should not have a racially integrated military. That was a brave decision. It was an important decision. It's made one of our United States militaries the most progressive, in terms of promotion, advancement opportunities for racial minorities of any organization in our country.

As you said earlier, most of our NATO allies have long ago realized that we are giving up on the service of thousands of potential volunteers who could be serving our nation at home and abroad. I don't think it makes any sense, because of a narrow social agenda, to continue to exclude them from open service in our military.

(COMMERCIAL BREAK)

KARIBJANIAN: Our next student question comes on the issue of campaign finance reform.

LAUREN CUTAJAR-WYNNE, UNIVERSITY OF DELAWARE STUDENT: What is your position on campaign finance reform? And what is your reaction to the recent Supreme Court ruling allowing corporations to donate to political campaigns?

KARIBJANIAN: Mr. Coons, you're first. One minute.

COONS: I think the Citizens United decision, the decision to which the student is referring, was an unfortunate and ill-decided decision, one that opens the flood gates to increase corporate contributions that could have the unintended consequence, I think unintended in the decision, of distorting our electoral process here in the United States. And I would support reforms that further disclose who is behind the shadowy groups, whether individuals or corporations that are trying to influence our elections by pouring money into it. Sunshine is the best disinfectant. And in politics it is best for us to disclose as fully and as broadly as possible who is making contributions.

O'DONNELL: Yet, the legislative efforts to do exactly that have failed to do that. The Disclose Act that Harry Reid, which he's called my opponent his pet, has put out there to do just that, has exempted the major corporations from disclosing it.

Instead what these efforts do is only serve to infringe on the First Amendment right of private citizens. I'll use my own campaign as an example. From our FCC reports, my supporters have been getting harassing phone calls, not just from reporters, but from all kinds of people who oppose any candidacy. They're using intimidation tactics because we are forced to disclose who is contributing to my campaign.

So this so-called finance reform is exempting the corporations, whether on the left or the right. It's those who are in Washington already, those who are over 10 years old, who have over 500,000 members and who are already playing in the back-room deals. So this is a misguided attempt.

WOLF: Do the American people have a right to know where all this money in these campaigns is coming from? O'CONNELL: Yes and no. I believe there are ways to do that, where we can report to the FCC. But we don't have to make them public unless there's a question of corruption and then that would prevent a lot of the harassment that my supporters are getting, that would prevent a lot of discussion about our First Amendment rights. We can disclose that to the FCC, but they don't have to put it up on a web site. That makes anyone vulnerable to further fundraising calls. Over and over, that's a repeated violation in many campaigns, not my own, but even my own party has said go look on someone's FCC report and call them up for a donation. And I've said, absolutely not. That's against the law.

WOLF: Very quickly.

O'DONNELL: So these so-called disclosure attempts are being abused.

COONS: I just -- there's so much there, Wolf, I don't know.

Frankly, I support full disclosure of campaign contributions, as I said before. I think it is the best way to ensure that we've got fair, open and clean campaigns. Folks should know who the folks who are who contributing to campaigns. It's an important way to hold candidates and elected officials accountable.

WOLF: We have another student question on the sensitive issue of religion in America.

HASIB HAQUE, UNIVERSITY OF DELAWARE STUDENT: In the light of the events in the past decade, Islam has been viewed as a religion for extremists and terrorists, where Muslims, including myself, can attest that Islam is far from that. Recently, there's been controversy over the mosque being built in the vicinity of Ground Zero and also the Florida pastor making outrageous remarks about the Koran. My question to you is, as a Senator, where is the line between freedom of speech and the respect of other religions, both of which freedoms are found in the First Amendment of the Constitution?

WOLF: Mr. Coons?

COONS: A great question and a difficult one. The Florida pastor who caused a lot outrage by threatening to burn the Koran showed profound misunderstanding of the difference between the Islamist terrorists, the extremists, who genuinely attacked America and, I think, deserve our condemnation, and the vast majority of Muslims who participate in a religion whose fundamental principles is commitment to peace and to embracing the rest of humanity. If that pastor wanted to make the right point, he should have threatened to burn the readings and the teachings of Osama bin Laden or of other folks who are part of the Islamist extremist groups.

It's an important challenge, a key role for the United States Supreme Court to continue to draw the line in the First Amendment between those who would do the equivalent of calling "fire" in a crowded theater, who would be inciting attack and riot, such as Osama bin Laden has in some extremist and hateful writings, and those who have scripture, religious traditions that are deserving and worthy of broad support. Those are difficult lines to police. And that's a central world that the Supreme Court plays in our democracy.

O'DONNELL: Well, I would agree, the Supreme Court has said that there are restrictions on our First Amendment rights. Again, you can't, as you said, go into a crowded theater and yell "fire." You can't stand up on a plane and yell "hijack." You can't slander and libel someone. However, where the question has come between what is protected free speech and what is not protected free speech, the Supreme Court has always ruled that the communities, the local community has the right to decide. And in the issue with the 9/11 mosque, that's exactly where the battle is being fought, by the community members who are impacted by that. And I support that.

WOLF: But the community members have -- at least the city council, the mayor and the representatives support this mosque that's supposed to be built near 9/11.

O'DONNELL: And a lot of the people on the ground do not, and they're going to have a lot to face from their constituents and maybe re- election is even going to be jeopardized.

WOLF: Should this cultural center and mosque near 9/11 be built?

COONS: There's already cultural center -- there's already mosques in many locations in Manhattan.

And as you mentioned, I would defer to the decision of the local land- use authorities, the folks who were elected by that community, to make decisions of where, when and how things ought to be built.

I don't think it was a wise choice of location. But I can't stand here and say that we should prevent folks from practicing their religion anywhere in the United States. To say that we will say you can't build a mosque here violates one of our most fundamental principles.

(COMMERCIAL BREAK)

KARIBJANIAN: Obviously, a United States Senator has the opportunity to determine, in a way, the makeup of that court. So what opinions of late that have come from our high court do you most object to?

O'DONNELL: Oh, gosh. Give me a specific one, I'm sorry.

KARIBJANIAN: Actually, I can't, because I need you to tell me which ones you object to.

O'DONNELL: I'm very sorry, right off the top of my head, I know that there are a lot, but I'll put it up on my web site, I promise you.

WOLF: We know you disagree with Roe v. Wade.

O'DONNELL: Yes, but that was -- she said a recent one.

WOLF: Well, that's relatively recent.

O'DONNELL: She said of late. Yes. Well, Roe v. Wade would not put the power -- it's --

(CROSSTALK)

(LAUGHTER)

WOLF: But since then, any other Supreme Court decisions --

O'DONNELL: But let me say, about Roe v. Wade, Roe v. Wade, if that were overturned, would not make abortion illegal in the United States. It would put the power back to the states.

WOLF: But besides that decision, anything else you disagree with?

O'DONNELL: Oh, there are several, when it comes to pornography, when it comes to court decisions -- not the Supreme Court but federal court decisions to give terrorists Mirandized rights. I mean, there's a lot of things that I believe that -- this California decision to overturn Don't Ask, Don't Tell. I believe that there are a lot of federal judges who are legislating from the bench.

WOLF: That wasn't the Supreme Court --

O'DONNELL: That was a federal judge. That's what I said, in California, yes.

WOLF: Which Supreme Court decisions, if any, do you disagree with?

COON: The most recent one that I've been engaged in, that we've talked about, is Citizens United. I think the Citizens United case takes a logical extension in the law, but takes it to a ridiculous extreme. Corporations really aren't entitled to the same free-speech rights as people. And in Delaware, America's corporate capital, you would think we would be fighting for the rights of corporations. But in terms of political contributions, the free-speech rights of corporations I don't think deserve the same protections as the free- speech rights of real, living, breathing voting humans. So I would disagree with that decision. And I would act to try and find ways to limit it, narrow it or even over turn it.

WOLF: Anything else?

COONS: That's the most important.

WOLF: Let's take another question from a student on energy.

JOHN GARDNER, UNIVERSITY OF DELAWARE STUDENT: My question is, where do you think funding should be placed in order to move towards the United States decreasing its carbon foot print?

WOLF: Mr. Coons?

COONS: The most effective investment in reducing emissions of CO2 and other things that cause greenhouse gas forming is energy efficiency and conservation. There was a significant investment in the stimulus bill in getting municipalities, local governments, the private sector to invest in efficiency and conservation. And those are investments that reduce emissions, put people to work, and develop cutting-edge technologies that make our systems operate better and to reduce, not just the emissions, but also the operating expenses.

In New Castle County, we took $3.8 million in EECBG grants and combined it with $4 million of our own and retro-fitted 20 county buildings. We reduced our operating costs. We reduced our emissions. We ultimately put folks to work here in our own community.

As you look at those kinds of investments around the country, they are the most important -- they have the most impact of anything you can do that will reduce greenhouse gas emissions.

There's many more things you need to do to do improve the efficiency of operations of coal-powered power plants.

KARIBJANIAN: The minute's up.

COON: Excuse me.

O'DONNELL: Well, I think the best way to address that that is most relevant is to talk about the issue of cap-and-trade because the winner of this U.S. Senate race can be immediately sworn in and serve in Harry Reid's lame-duck session and vote on cap-and-trade.

I do believe we have to be good stewards of this earth. We don't need to do it at the expense of our citizens, and cap-and-trade will do that. Whether it's farmers, senior citizens or realtors who are concerned about its green compliance standards, nobody wants this bill. This bill is a national energy tax that will ration energy use and increase our utility bills. Senior citizens are concerned about the cost of their utility bills going up. Farmers are concerned about the green compliance standards and the raised utility bills shutting down their operations. And realtors are concerned about the green compliance standards hurting an already hurting housing market.

But I would have to ask my opponent, speaking of cap-and-trade, your family business stands to financially benefit from some environmental legislation under Bush. Would you business --

KARIBJANIAN: The minute is up, so let's toss it to him directly.

O'DONNELL: Would your business --

COON: A fascinating question that really makes no sense yet. So if you would like to let --

(CROSSTALK)

KARIBJANIAN: Be my guest. Go ahead and finish --

O'DONNELL: Yes, I would just like to know --

COON: Let her ask the whole question.

O'DONNELL: I would like to know -- COON: -- what she is talking about.

O'DONNELL: I would just like to know if your family business stands to have a financial gain if cap-and-trade is passed. And if so, would you recuse yourself in the lame-duck session from voting with Harry Reid.

COON: A fascinating question. No. To the best of my knowledge, there is no direct financial benefit. And I do think it's important for folks in public office to conduct themselves ethically, to be transparent and to be accountable for decisions they make and for votes that they cast.

I am someone who thinks greenhouse gases are a concern, are a problem for the long term. I think we need to take steps to rein them and to deal with environmental consequences that they might present.

WOLF: Let me ask Ms. O'Donnell, what evidence you have any family business he has would stand to gain from cap-and-trade?

O'DONNELL: Because they make fuel cells and --

WOLF: Who's they?

O'DONNELL: W.L. Gore. They make some of the stuff that will be required by these businesses to regulate cap-and-trade. So --

WOLF: Is that true?

COONS: That's quite a stretch. Gore makes over 1,000 products. It was difficult for me to understand from her question what she was talking about.

Gore is a company that makes lots and lots of products, from implantable medical devices to dental floss to some membranes that are component parts that go into systems that go into fuel cells. Fuel cells are not currently fielded broadly in the United States. It's a cutting-edge technology that someday has the promise of being a significant contributor to making a more energy-efficient, cleaner transportation future. But, to me, the impact is so distant from any particular proposal on cap-and-trade, it took a couple minutes to even understand what she was talking about.

(COMMERCIAL BREAK)

KARIBJANIAN: This is an issue that I think that can really illustrate the differences perhaps between the two of you. That is what specifically would you and could you do to actually help end any of the bitter bipartisan, nonpartisanship in Washington? What would you be able to do as an individual once you arrive in Washington?

DONNELLL: Well, I've had to fight my party to be here on this stage, to win the nomination and, to some extents, I am still fighting my party. So when I go to Washington, my allegiance will be to the voters of Delaware, not any special interests. My whole campaign has been about returning the political process back to the people of Delaware. And to me, that's a great thing.

So what I would do is I would stand strong on legislation that benefits the interest of our citizens, not the special interests in Washington, D.C. And I would stand there and not just vote against a piece of legislation, but make the floor speeches that would try to convince my colleagues on both sides of the aisle, who've lost their way and given in to partisanship, so much that it has caused several stalemates, as to why this is in the best interest of their constituents? I would stand firm regardless of what kind of pressure was on me from either party to stand firm in doing what's right for the people of Delaware, not the interests in Washington.

COON: I frankly don't think my opponent can or has pointed to one single example where she supports the current administration or an initiative of the Democratic Party.

O'DONNELL: That's not true.

COONS: I have a real practical record of having reached by bipartisan solutions here in county government of working with the elected Republicans who have served with me on county council and on council while I've been county executive. I have a real hands-on record here in the private sector and in my service and partnership with the private sector of reaching out to folks from different political backgrounds, from different experiences, and from different world views to work with them to find solutions. I think that's the kind of record that Delawareans will look at in judging whether or not I have the capacity to address some of this endless partisanship.

WOLF: On this specific issue, and Ms. O'Donnell raised it earlier, I'll give you a chance to clarify to explain. She says Harry Reid, the Senate majority leader, has called you his pet.

(LAUGHTER)

COONS: I don't know why Harry Reid said that. I'm nobody's pet. I'm going to be a bulldog for Delaware. I'm running to represent all Delawareans of whatever party, not just the Democrats. I have a significant amount of support from Independents, from Republicans, from Democrats, from all three counties. I have a record of independence and of fighting for the public interest. I would continue that in Washington.

WOLF: Just to clarify another point --

(CROSSTALK)

WOLF: -- from earlier just to make sure we tie this up, earlier you said you didn't want to have to talk about comments you made years ago about witchcraft and stuff like that. But in this commercial that's so widely seen you begin the commercial with the words "I am not a witch."

O'DONNELL: To put it to rest.

WOLF: What were you thinking? O'DONNELL: To put it to rest, to put it behind me.

WOLF: Didn't you realize that if you do that in a commercial it would revive it and everybody would be talking about that?

O'DONNELL: We're moving past that and we're talking about the issues.

I'd like to address what my opponent said about being a bulldog for Delaware, yet in a fund-raising letter, he promises to support the Reid/Obama/Pelosi agenda lock, step and barrel. That's not nonpartisanship.

And, again, why is the Democratic Party pulling out all the stops to get him elected? Because they see him as a rubberstamp for their agenda.

There are many things I have publicly said that I support the Obama administration on. I support Obama's decision to send troops to Afghanistan. I support Obama's decision for drones. I support Obama's decision to treat the American who's recruiting terrorists on American soil, who's hiding in Yemen, I support the decision for our intelligence agencies to do whatever it takes to take him out. So there are things I proudly support when it's in the best interest of Delawareans.

But I believe a lot of the policies coming from this administration are not in the best interest of Delawareans. And most of them are the failed stimulus bills, where we've been promised one thing and then received another. But breaking promises is something that my opponent is very comfortable doing.

WOLF: We will begin the closing statements. both of you will have a chance to make your final comments. We'll begin with Ms. O'Donnell.

O'DONNELL: Thank you.

Once again, I'd like to thank the host of this debate and Nancy and Wolf.

I hope now the Delaware voters better understand the clear choice we face in November. My opponent has a record of raising taxes and a record of wasteful spending. Like so many career politicians, he says he'd do one thing and then only breaks his promises after he's assumed office. My opponent will rubber-stamp the same famed policies that have caused unemployment and our national debt to skyrocket. He's in lock step with Barack Obama and Harry Reid and that's why Harry Reid called him his be pet.

I'm not a Democrat. But I know what's happening in this country now is not what my Democratic friends voted for when they voted for change in 2008. What Washington needs now are new voices and new ideas that look to the people and not to the government, to the solutions to our economic problems. My opponent is addicted to a culture of spending, waste, fraud and abuse, whether it's spending tax dollars on men's fashion shows or to pay off his cronies with sweetheart pension deals and special interests. We already have enough politicians in Washington like that.

I want to go to Washington and be the voice of the people of Delaware, not any party or special interest group. I want to go to Washington and represent the people who put me on this stage tonight and who are willing to work hard to get our country back on track again. It's not going to be easy, but I do believe that America is the greatest force of good in the world and I have never questioned whether America is a beacon of freedom and justice. We will get our financial house in order, we will cut spending, we will reform our government and we will defeat our enemies and see triumph over freedom again.

So with that said, I hope you will support me and cast your vote for O'Donnell for U.S. Senate. God bless you, and God bless Delaware.

COONS: I appreciate your attention to tonight's debate thank you for the tough questions you've asked and the conversation we've had over the last 90 minutes.

I think you've heard there's a real and clear difference in my opponent and me in our values, in our experience and in our approach. Ms. O'Donnell has experience at running for office but not at really running anything, at delivering catchy slogans but at not delivering on any real solutions. Frankly, that's sharpening the partisan divide, not bridging it. She's focused too little on the issues that really matter for Delawareans and too much on the issues that make for good sound bites.

I think what Delaware needs, what Delaware deserves is someone as their next United States Senator who has real hands-on experience, experience solving problems, fixing what's wrong with our community and in Washington, and tackling the real problems that face us in America. I believe I offer you real ideas based on that experience. I'm the only candidate on this stage tonight with experience working in and with the private sector.

KARIBJANIAN: All right.

COONS: And I'd be grateful for your vote.

KARIBJANIAN: My apologies for interrupting.

But thank you so much. Time is up.

O'DONNELL: Thank you.

KARIBJANIAN: Wolf Blitzer, a pleasure.

BLITZER: Thank you very much.

KARIBJANIAN: Thank you.

For all of you, who are watching, thank you so much for joining us for Delaware First Media. I'm Nancy Karibjanian. Good night.