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Well, thank you, Jim. And thanks to everybody. And I do have a sad note tonight. Senator Kennedy is in the hospital. He is a dearly beloved friend to all of us. Our thoughts and prayers go out to the lion of the Senate. I also want to thank the University of Mississippi for hosting us tonight. And Jim, I -- I've been not feeling too great about a lot of things lately. So have a lot of Americans who are facing challenges. But I'm feeling a little better tonight, and I'll tell you why. Because as we're here tonight in this debate, we are seeing for the first time in a long time Republicans and Democrats together sitting down, trying to work out a solution to this fiscal crisis that we're in. And have no doubt about the magnitude of this crisis. And we're not talking about failure of institutions on Wall Street, we're talking about failures on Main Street and people who will lose their jobs and their credits and their homes if we don't fix the greatest fiscal crisis probably in -- certainly in our time, and I've been around a little while. But the point is -- the point is, we are finally seeing Republicans and Democrats sitting down and negotiating together and coming up with a package. This package has transparency in it. It has to have accountability and oversight. It has to have options for loans to failing businesses rather than the government taking over those loans. We have to -- it has to have a package with a number of other essential elements to it. And yes, I went back to Washington, and I met with my Republicans in the House of Representatives. And they weren't part of the negotiations, and I understand that. And it was the House Republicans that decided that they would be part of the solution to this problem. But I want to emphasize one point to all Americans tonight: This isn't the beginning of the end of this crisis. This is the end of the beginning, if we come out with a package that will keep these institutions stable. And we've got a lot of work to do. And we've got to create jobs. And one of the areas, of course, is to eliminate our dependence on foreign oil. less more

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Sure. Sure, but -- but let me -- let me point out I also warned about Fannie Mae and Freddie Mac and warned about corporate greed and excess and CEO pay and all that. A lot of us saw this train wreck coming. But there's also the issue of responsibility. You've mentioned President Dwight David Eisenhower. President Eisenhower, on the night before the Normandy invasion, went into his room, and he wrote out two letters. One of them was a letter congratulating the great members of the military and Allies that had conducted and succeeded in the greatest invasion in history -- still, to this day, and forever. And he wrote out another letter, and that was a letter of resignation from the United States Army for the failure of the landings at Normandy. Somehow we've lost that accountability. I've been heavily criticized because I called for the resignation of the chairman of the Securities and Exchange Commission. We've got to start also holding people accountable, and we've got to reward people who succeed. But somehow in Washington today -- and I'm afraid on Wall Street -- greed is rewarded, excess is rewarded, and corruption, or certainly a failure to carry out our responsibility, is rewarded. As president of the United States, people are going to be held accountable in my administration. And I promise you that'll happen. less more

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-- Senator Obama suspended those requests for pork barrel projects after he was running for president of the United States. He didn't happen to see that light there in the first three years as a member of the United States Senate. Nine hundred and thirty-two million dollars in requests maybe to Senator Obama is not a lot of money. But the point is that you -- see, I hear this all the time. It's only $18 billion. Do you know that it's tripled in the last five years? Do you know that it's gone completely out of control, to the point where it corrupts people? It corrupts people. That's why we have, as I said, people under federal indictment and charges. It's a system that's got to be cleaned up. I have fought against it. My career -- I have fought against it. I was called the sheriff by the -- (chuckles) -- one of the senior members of the Appropriations Committee. I didn't win Miss Congeniality in the United States Senate. Now, Senator Obama didn't mention that along with his tax cuts he is also proposing some $800 billion in new spending on new programs. Now, that's the fundamental difference between myself and Senator Obama. I want to cut spending. I want to keep taxes low. The worst thing we could do in this economic climate is to raise people's taxes. less more

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I don't know where John's getting his figures. Let's just be clear. What I do is, I close corporate loopholes, stop providing tax cuts to corporations that are shipping jobs overseas, so that we're giving tax breaks to companies that are investing here in the United States. I make sure that we have a health care system that allows for everyone to have basic coverage. I think those are pretty important priorities. And I'd pay for every dime of them. But let's go back to the original point. John, nobody is denying that $18 billion is important. And absolutely we need earmark reform. And when I'm president, I will go line by line to make sure that we are not spending money unwisely. But the fact is that eliminating earmarks alone is not a recipe for how we're going to get the middle class back on track. And when you look at your tax policies that are directed primarily at those who are doing well and you are neglecting people who are really struggling right now, I think, that is a continuation of the last eight years. And we can't afford another four. less more

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Well, well, let me give you an example of what Senator Obama finds objectionable. the business tax. Right now the United States of America business pays the second highest business taxes in the world, 35 percent. Ireland pays 11 percent. Now, if you're a businessperson and you can locate anyplace in the world, then obviously if you go to the country where it's 11 percent tax versus 35, you're going to be able to create jobs, increase your business, make more investment, et cetera. I want to cut that business tax. I want to cut it so that businesses will remain and -- in the United States of America and create jobs. But again, I want to return, it's a lot more than $18 billion in pork-barrel spending. I can tell you it's rife. It's throughout. The United States Senate will take up a continuing resolution tomorrow or the next day -- sometime next week -- with 2,000 -- 2,000 -- look at them, my friends. Look at 'em. You'll be appalled. And Senator Obama is a recent convert, after requesting $932 million worth of pork-barrel spending projects. So the point is, I want people to have tax cuts. I want every family to have a $5,000 refundable tax credit so they can go out and purchase their own health care. I want to double the dividend, from $3,500 to $7,000, for every dependent child in America. I know that the worst thing we could possibly do is to raise taxes on anybody, and a lot of people might be interested in Senator Obama's definition of "rich." less more

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Well, let me just make a couple of points.

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My -- here's what I can tell the American people: 95 percent of you will get a tax cut. And if you make less than $250,000 -- less than a quarter-million dollars a year -- then you will not see one dime's worth of tax increase. Now, John mentioned the fact that business taxes on paper are high in this country, and he's absolutely right. Here's the problem: There are so many loopholes that have been written into the tax code, oftentimes with support of Senator McCain, that we actually see our businesses pay effectively one of the lowest tax rates in the world. And what that means, then, is that there are people out there who are working every day who are not getting a tax cut, and you want to give them more. It's not like you want to close the loopholes. You just want to add an additional tax cut over the loopholes, and that's a problem. Just one last point I want to make. Senator McCain talked about providing a $5,000 health credit. Now, what he doesn't tell you is that he intends to, for the first time in history, tax health benefits. So you may end up getting a $5,000 tax credit. Here's the only problem: Your employer now has to pay taxes on the health care that you're getting from your employer, and if you end up losing your health care from your employer, you've got to go out on the open market and try to buy it. It is not a good deal for the American people, but it's an example of this notion that the market can always solve everything and that the less regulation we have the better off we're going to be. less more

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Well, look, look, we -- no matter what, we've got to cut spending. We have -- as I said, we've let government get completely out of control. Senator Obama has the most liberal voting record in the United States Senate. It's hard to reach across the aisle from that far to the left. (Chuckles.) (View cut data) The point -- the point is -- the point is we need to examine every agency of government. First of all, by the way, I'd eliminate ethanol subsidies. I oppose ethanol subsidies. I think that we have to return, particularly in defense spending, which is the largest part of our appropriations -- we have to do away with cost-plus contracts. We now have defense systems that the costs are completely out of control. We tried to build a little ship called the Littoral Combat Ship that supposed to cost $140 million, ended up costing $400 million and we still haven't done it. So we need to have fixed-cost contracts. We need very badly to understand that defense spending is very important and vital, particularly in the new challenges we face in the world, but we have to get a lot of the cost overruns under control. I know how to do that. I saved the taxpayers $6.8 billion by fighting a contract that was negotiated between Boeing and DOD that was completely wrong. And we fixed it and we killed it and the people ended up in federal prison. So I know how to do this, because I've been involved in these issues for many, many years. But I think that we have to examine every agency of government and find out those that are doing their job and keep them and find out those that aren't and eliminate them. And we'll have to scrub every agency of government. less more

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There is no doubt that it's going to affect our budgets. There is no doubt about it. The -- not only -- even if we get all $700 billion back, let's assume the markets recover; we're holding assets long enough that eventually taxpayers get it back. And that happened during the Great Depression, when Roosevelt purchases a whole bunch of homes. Over time, home values went back up. And in fact, government made a profit. If we're lucky and we do it right, that could potentially happen. But in the short term, there's an outlay. And we may not see that money for a while. And because the economy is slowing down, I think, we can also expect less tax revenue. So there's no doubt that as president, I'm going to have to make some tough decisions. The only point I want to make is this, that in order to make those tough decisions, we've got to know what our values are and who we're fighting for and what our priorities are. (View cut data) And if we are spending $300 billion on tax cuts for people who don't need them and weren't even asking for them and we are leaving out health care, which is crushing on people all across the country, then I think we have made a bad decision, and I want to make sure we're not shortchanging our long-term priorities. less more

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But I just have to have make this point, Jim. John, it's been your president, who you said you agreed with 90 percent of the time, who presided over this increase in spending, this orgy of spending, and enormous deficits. And you voted for almost all of his budgets. So to stand here after eight years and say that you're going to lead on controlling spending and, you know, balancing our tax cuts so that they help middle-class families, when over the last eight years that hasn't happened, I think just is, you know, kind of hard to swallow. less more

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What about that point?

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Which point? You raised a whole bunch of them.

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Well, the latter point. I know. All right.

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Let's go to the latter point and we'll back up, the point about your not having been --

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Afghanistan. Lead -- a new lead question. Having resolved Iraq, we'll move to Afghanistan. (Laughter.) And it goes to you, Senator Obama, and it's -- it's -- it picks up on a point that's already been made. Do you think more troop -- more U.S. troops should be sent to Afghanistan? How many, and when? less more

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Jim, let me just make a point. I've got a bracelet, too, from Sergeant -- from the mother of Sergeant Ryan David Jopek, given to me in Green Bay. And she asked me, "Can you please make sure that another mother's not going through what I'm going through?" Now, the -- no U.S. soldier ever dies in vain, because they are carrying out the missions of their commander in chief. And we honor all the service that they've provided. And they've -- our troops have performed brilliantly. The question is for the next president -- are we making good judgments about how to keep America safe -- precisely because sending our military into battle is such an enormous step. And the point that I originally made is that we took our eye off Afghanistan; we took our eye off the folks who perpetrated 9/11. They are still sending out videotapes. And Senator McCain, nobody's talking about defeat in Iraq, but, you know, I have to say that we are having enormous problems in Afghanistan because of that decision. And it is not true that you have consistently been concerned about what happened in Afghanistan. I mean, at -- at one point, while you were focused on Iraq, you said, well, we can muddle through Afghanistan. You don't muddle through the central front on terror. And you don't muddle through going after bin Laden. You don't muddle through stamping out the Taliban. I think that is something that we have to take seriously. And when I'm president, I will. (Cross talk.) less more

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You know, you might, you might think that with that kind of concern, that Senator Obama would have gone to Afghanistan particularly given his responsibilities as the subcommittee chairman. And by the way, when I'm subcommittee chairman, we take up the issues under my subcommittee. But the important thing is, the important thing is, I've visited Afghanistan and I've traveled to Waziristan and I've traveled to these places. And I know what our security requirements are and I know what our needs are. And so the point is that we will prevail in Afghanistan. But we need the new strategy and we need it to succeed. But the important thing is, if we suffer defeat in Iraq, which General Petraeus predicts we will if we adopted Senator Obama's set date for withdrawal, then that will have a calamitous effect on Afghanistan and American national security interest in the region. Senator Obama doesn't seem to understand, there's a connection between the two. less more

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My reading of the threat from Iran is that if Iran acquires nuclear weapons, it's an existential threat to the state of Israel. And it is a threat to the region, because the other countries in the region will feel a compelling requirement to acquire nuclear weapons as well. Now, we cannot allow a second Holocaust. Let's just make that very clear. But I have proposed for a long time -- and I've had conversation with foreign leaders about -- forming a league of democracies. Let's be clear and let's have some straight talk: the Russians are preventing significant action in the United Nations Security Council. I have proposed a league of democracies, a group of people -- a group of countries that share common interests, common values, common ideals. And they also control a lot of the world's economic power. We could impose significant, meaningful, painful sanctions on the Iranians that I think could have a beneficial effect. The Iranians have a lousy government, so therefore their economy is lousy even though they have significant oil revenues. So I am convinced that together we can, with the French, with the British, with the Germans and other countries -- democracies around the world, we can affect Iranian behavior. But have no doubt -- but have no doubt that the Iranians continue on the path to the acquisition of a nuclear weapon as we speak tonight. And it is a threat not only in the region, but around the world. But I'd also like to point out the Iranians are putting the most lethal IEDs into Iraq, which are killing young Americans. There are special groups in Iran that are coming into Iraq and are being trained in Iran. (View cut data) And there is the -- are the Republican Guard in Iran, which Senator Kyl had an amendment in order to declare them a sponsor of terror. Senator Obama said that would be provocative. So this is a serious threat. This is a serious threat to the security in the world, and I believe we can act, and we can act with our friends and allies and -- and reduce that threat as quickly as possible. But have no doubt about the ultimate result of them acquiring nuclear weapons. less more

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-- who is -- Ahmadinejad, who is now in New York talking about the extermination of the State of Israel, of wiping Israel off the map, and we're going to sit down without precondition across the table to legitimize and give a propaganda platform to a person that is espousing the extermination of the State of Israel and therefore -- then giving them more credence in the world arena -- and therefore saying they've probably been doing the right thing because you will sit down across the table from them and that will legitimize their illegal behavior. The point is that throughout history, whether it be Ronald Reagan, who wouldn't sit down with Brezhnev, Andropov or Chernenko until Gorbachev was ready with glasnost and perestroika or whether it be Nixon's trip to China, which was preceded by Henry Kissinger many times before he went -- look, I'll sit down with anybody, but there's got to be preconditions, and those preconditions would apply that we wouldn't legitimize with a face-to-face meeting a person like Ahmadinejad. Now, Senator Obama said without precondition. less more

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-- so he -- he may not be the right person to talk to. But I reserve the right as president of the United States to -- to meet with anybody at a time and place of my choosing if I think it's going to keep America safe. And I -- I'm glad that Senator McCain brought up the history -- the bipartisan history -- of us engaging in direct diplomacy. Senator McCain mentioned Henry Kissinger, who's one of his advisers, who along with five recent secretaries of State just said that we should meet with Iran -- guess what? -- without precondition. This is one of your own advisers. Now, understand what this means, "without preconditions." It doesn't mean that you invite them over for tea one day. What it means is that we don't do what we've been doing, which is to say until you agree to do exactly what we say, we won't have direct contacts with you. There's a difference between preconditions and preparation. Of course we've got to do preparation, starting with low-level diplomatic talks, and it may not work because Iran is a rogue regime. But I will point out that I was called naive when I suggested that we need to look at exploring contacts with Iran, and you know what, President Bush recently sent a senior ambassador, Bill Burns, to participate in talks, with the Europeans, around the issue of nuclear weapons. Again, it may not work, but if it doesn't work then we have strengthened our ability to form alliances to impose the tough sanctions that Senator McCain just mentioned. (View cut data) And when we haven't done it, as in North Korea, let me just take one more example. In North Korea, we cut off talks. They're a member of the axis of evil. We can't deal with them. And you know what happened? They went -- they quadrupled their nuclear capacity. They tested a nuke. They tested missiles. They pulled out of the non-proliferation agreement. And they sent nuclear secrets potentially to countries like Syria. When we reengaged, because again the Bush administration reversed course on this, then we have at least made some progress. Although right now because of the problems in North Korea, we are seeing it on shaky ground. And I just, so I just have to make this general point, that the Bush administration, some of Senator McCain's own advisers all think this is important. And Senator McCain appears resistant. He even said the other day that he would not meet potentially with the prime minister of Spain because he, you know, he wasn't sure whether they were aligned with us. I mean, Spain. Spain is a NATO ally. If we can't meet with our friends, I don't know how we're going to lead the world in terms of dealing with critical issues like terrorism. less more

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Well, I think that given what's happened over the last several weeks and months, our entire Russian approach has to be evaluated, because a resurgent and very aggressive Russia is a threat to the peace and stability of the region. Their actions in Georgia were unacceptable. They were unwarranted. And at this point it is absolutely critical for the next president to make clear that we have to follow through on our six-party -- or the six-point cease-fire. They have to remove themselves from South Ossetia and Abkhazia. It is absolutely important that we have a unified alliance and that we explain to the Russians that you cannot be a 21st century superpower or power and act like a 20th century dictatorship. And we also have to affirm all the fledgling democracies in that region -- you know, the Estonians, the Lithuanians, the Latvians, the Poles, the Czechs -- that we are in fact going to be supportive and in solidarity with them in their efforts. They are members of NATO. (View cut data) And to countries like Georgia and the Ukraine, I think, we have to insist that they are free to join NATO if they meet the requirements. And they should have a membership action plan immediately to start bringing them in. Now, we also can't return to a Cold War posture with respect to Russia. It's important that we recognize there are going to be some areas of common interest. One is nuclear proliferation. They have not only 15,000 nuclear warhead but they've got enough to make another 40,000. And some of those loose nukes could fall into the hands of al Qaeda. This is an area where I've led on in the Senate, working with a Republican, ranking member of the Senate Foreign Relations Committee, Dick Lugar, to deal with the proliferation of loose nuclear weapons. That's an area where we're going to have to work with Russia. But we have to have a president who is clear that you don't deal with Russia based on staring into his eyes and seeing his soul. You deal with Russia based on, what are your, what are the national security interests of the United States of America? And we have to recognize that the way they've been behaving lately demands a sharp response from the international community and our allies. less more

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No, actually, I think Senator McCain and I agree for the most part on these issues. Obviously, I disagree with this notion that somehow we did not forcefully object to Russians going into Georgia. I immediately said that this was illegal and objectionable. And absolutely, I wanted a cessation of the violence, because it put an enormous strain on Georgia. And that's why I was the first to say that we have to rebuild the Georgian economy and called for a billion dollars that has now gone in to help them rebuild, because part of Russia's intentions here was to weaken the economy to the point where President Saakashvili was so weakened that he might be replaced by somebody that Putin favored more. Two points I think are important to -- to think about when it comes to Russia: Number one is we have to have foresight and anticipate some of these problems. So back in April, I warned the administration that you had Russian peacekeepers in Georgian territory. That made no sense whatsoever. And what we needed to do was replace them with international peacekeepers and a special envoy to resolve the crisis before it boiled over. That wasn't done, but had it been done, it's possible we could have avoided the -- the issue. The second point I want to make is -- is the issue of energy. Russia is, in part, resurgent and Putin is feeling powerful because of petro-dollars, as Senator McCain mentioned. That means that we, as one of the biggest consumers of oil -- 25 percent of the world's oil -- have to have an energy strategy not just to deal with Russia but to deal with many of the rogue states we've talked about -- Iran, Venezuela -- and that means, yes, increasing domestic production and offshore drilling. (View cut data) But we only have 3 percent of the world's oil supplies and we use 25 percents of the world's oil, so we can't simply drill our way out of the problem. What we're going to have to do is to approach it through alternative energy like solar and wind and biodiesel and, yes, nuclear energy, clean coal technology. And you know, I've got a plan for us to make a significant investment over the next 10 years to do that. And -- and I have to say, Senator McCain and I, I -- I think, agree on the importance of energy, but Senator McCain mentioned earlier the importance of looking at a record. Over 26 years, Senator McCain voted 23 times against alternative energy like solar and wind and biodiesel. And so we -- we -- we -- we got to -- we got to walk the walk and not just talk the talk when it comes to energy independence because this is probably going to be just as vital for our economy and the -- the pain the people are feeling at the pump -- and you know, winter's coming and home heating oil -- as it is our national security and the issue of climate change that's so important. less more

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I -- I just have to correct the record here. I have never said that I object to nuclear waste. What I've said is that we have to store if safely. MR. LEHRER. (Inaudible.) SEN. OBAMA. And Senator McCain, he says -- he talks about Arizona, I've got to make this point, Jim. MR. LEHRER. Okay. less more

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Well, first of all, I think that we are safer in some ways. Obviously we've poured billions of dollars into airport security. We have done some work in terms of securing potential targets. But we still have a long way to go. We've got to make sure that we're hardening our chemical sites. We haven't done enough in terms of transit. We haven't done enough in terms of ports. And the biggest threat that we face right now is not a nuclear missile coming over the skies; it's in a suitcase. This is why the issue of nuclear proliferation is so important. It is the -- the biggest threat to the United States is a terrorist getting a hands on nuclear weapons. And we, we are spending billions of dollars on missile defense. And I actually believe that we need missile defense because of Iran and North Korea and the potential for them to obtain or to launch nuclear weapons. But I also believe that when we are only spending a few hundred million dollars on nuclear proliferation, then we're making a mistake. The other thing that we have to focus on though is al Qaeda. They are now operating in 60 countries. (View cut data) We can't simply be focused on Iraq. We have to go to the root cause, and that is in Afghanistan and Pakistan. That's going to be critical. We are going to need more cooperation with our allies. And one last point I want to make. It is important for us to understand that the way we are perceived in the world is going to make a difference in terms of our capacity to get cooperation and root out terrorism. And one of the things that I intend to do as president is to restore America's standing in the world. We are less respected now than we were eight years ago or even four years ago. And this is the greatest country on Earth. But because of some of the mistakes that have been made -- and I give Senator McCain great credit on the torture issue, for having identified that as something that undermines our long-term security -- because of those things, we, I think, are going to have a lot of work to do in the next administration to restore that sense that America's that shining beacon on a hill. less more

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Well, let me just make a closing point. My father came from Kenya. That's where I get my name. And in the '60s, he wrote letter after letter to come to college here in the United States, because the notion was that there was no other country on earth where you could make it if you tried. The ideals and the values of the United States inspired the entire world. I don't think any of us can say that our standing in the world now, the way children around the world look at the United States, is the same. And part of what we need to do, what the next president has to do, and this is part of our judgment -- this is part of how we are going to keep America safe -- is to, to send a message to the world that we are going to invest in issues like education; we are going to invest in issues that relate to how ordinary people are able to live out their dreams. And that is something that I'm going to be committed to as president of the United States. less more

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Yeah. Well, you know, until two weeks ago, it was two Mondays ago John McCain said at 9:00 in the morning that the fundamentals of the economy were strong. Two weeks before that, he said George -- we've made great economic progress under George Bush's policies. Nine o'clock, the economy was strong; 11:00 that same day, two Mondays ago, John McCain said that we have an economic crisis. That doesn't make John McCain a bad guy, but it does point out he's out of touch. Those folks on the sidelines knew that two months ago. less more

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Gwen, I don't know where to start. We don't call a redistribution in my neighborhood -- Scranton, Claymont, Wilmington, the places I grew up -- to give the fair -- to say that not giving ExxonMobil another $4 billion tax cut this year, as John calls for, and giving it to middle-class people to be able to pay to get their kids to college -- we don't call that redistribution; we call that fairness, number one. Number two, factually, 95 percent of small businesses in America, their owners make less than $250,000 a year. They would not get one single, solitary penny increase in taxes, those small businesses. Now with regard to the -- to the health care plan, you know, it's -- one with one hand you give it; the other, you take it. You know how Barack Obama -- excuse me. You know how John McCain pays for his $5,000 tax credit you're going to get, a family will get? He taxes as income every one of you out there, every one of you listening who has a health care plan through your employer. That's how he raises $3.6 trillion on your -- taxing your health care benefit, to give you $5,000 plan, which, his website points out, will go straight to the insurance company. And then you're going to have to replace a $12,000 -- that's the average cost of the plan you get through your employer; it costs $12,000 -- you're going to have to pay -- replace $12,000 plan, because 20 million of you are going to be dropped. Twenty million of you will be dropped. So you're going to have to place -- replace a $12,000 plan with a $5,000 check you've just given to the insurance company. I call that the ultimate Bridge to Nowhere. less more

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Well, mortgage holders didn't pay the price. Only 10 percent of the people who are -- have been affected by this whole switch from Chapter 7 to Chapter 13. It gets complicated. But the point of this, Barack Obama saw the glass as half-empty, I saw it as half-full. We disagreed on that. And 85 senators voted one way, and 15 voted the other way. But here's the deal. Barack Obama pointed out two years ago that there was a subprime mortgage crisis and wrote to the secretary of Treasury. And he said: You better get on the stick here. You better look at it. John McCain said as early as last December, quote -- I'm -- I'm paraphrasing -- I'm surprised about this subprime mortgage crisis, number one. Number two, with regard to bankruptcy now, Gwen, what we should be doing now -- and Barack Obama and I support it -- we should be allowing bankruptcy courts to be able to readjust not just the interest rate you are paying on your mortgage to be able to stay in your home, but in -- be able to adjust the principal that you owe, the principal that that you owe. That would keep people in their homes, actually help banks by keeping them from going under. But John McCain, as I understand it -- I'm not sure of this, but I believe John McCain and the governor don't support that. There are ways to help people now, and the ways that we are offering are not being supported by -- by the Bush administration nor do I believe by John McCain and Governor Palin. less more

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Absolutely. Do I support granting same-sex benefits? Absolutely, positively. Look, in a(n) Obama-Biden administration, there will be absolutely no distinction from a constitutional standpoint or a legal standpoint between a same-sex and a heterosexual couple. The fact of the matter is that under the Constitution, we should be granted -- same-sex couples should be able to have visitation rights in the hospital, joint ownership of property, life insurance policies, et cetera. That's only fair. It's what the Constitution calls for. And so we do support, we do support making sure that committed couples in a same-sex marriage are guaranteed the same constitutional benefits as it relates to their property rights, their rights of visitation, their rights of insurance, the rights of ownership, as heterosexual couples do. less more

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Your plan is a white flag of surrender in Iraq, and that is not what our troops need to hear today, that's for sure, and it's not what our nation needs to be able to count on. You guys opposed the surge, the surge worked. Barack Obama still can't admit the -- the surge works. We'll know when we're finished in Iraq when the Iraqi government can govern its people and when the Iraqi security forces can secure its people. And our commanders on the ground will tell us when those conditions have been met. And Maliki and Talabani also, in working with us, are knowing, again, that we're getting closer and closer to that point, that victory that's within sight. Now you said regarding Senator McCain's military policies there, Senator Biden, that you supported a lot of these things. In fact you said that you wanted to run -- you'd be honored to run with him on the ticket, and that's an indication, I think, of some of the support that you had, at least until you became the VP pick here. less more

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Can I -- can I clarify this? That's just simply not true about Barack Obama. He did not say he'd sit down with Ahmadinejad. The fact of the matter is, it surprises me that Senator McCain doesn't realize that Ahmadinejad does not control the security apparatus in Iran. The theocracy controls the security apparatus, number one. Number two, five secretaries of State did say we should talk with and sit down. Now, John and Governor Palin now say they're all for -- they have a "passion," I think the phrase was, a "passion for diplomacy," and that we have to bring our friends and allies along. Our friends and allies have been saying, Gwen, sit down, talk, talk, talk. Our friends and allies have been saying that. Five secretaries of State, three of them Republicans. And John McCain has said he would go along with an agreement, but he wouldn't sit down. Now, how do you do that when you don't have your administration sit down and talk with the adversary? And look what President Bush did. After five years, he finally sent a high-ranking diplomat to meet with the highest-ranking diplomats in Iran in Europe to try to work out an arrangement. Our allies are on that same page. And if we don't go the extra mile in diplomacy, what makes you think the allies are going to sit with us? And last point I'll make: John McCain said as recently as a couple weeks ago, he wouldn't even sit down with the government of Spain, a NATO ally that has troops in Afghanistan with us now. I find that incredible. less more

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No, I do not believe that it has been. But I'm so encouraged to know that we both love Israel, and I think that is a good thing to get agree to, Senator Biden. I respect your position on that. No. In fact, when we talk about the Bush administration, there's a time too when Americans are going to say enough is enough with your ticket on constantly looking backwards and pointing fingers and -- and doing the blame game. There have been huge blunders in the war. There have been huge blunders throughout this administration, as there are with every administration. But for a ticket that wants to talk about change and looking into the future, there's just too much finger-pointing backwards to ever make us believe that's where you're going. Positive change is coming, though. Reform of government is coming. We'll learn from the past mistakes in this administration and other administrations. And we're going to forge ahead with putting government back on the side of the people and making sure that our country comes first, putting obsessive partisanship aside. That's what John McCain has been known for. In all these years, he has been the maverick. He has ruffled feathers. But I know, Senator Biden, you have respected him for that, and I respect you for acknowledging that. But change is coming. less more

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The line that should be drawn is whether or not we, A, first of all, have the capacity to do anything about it, number one; number two, there are certain new lines that have to be drawn internationally. When a country engages in genocide, when a country engages in harboring people who are killing our people -- terrorists -- and they will do nothing about it, that in fact -- at that point, that country, in my view and in Barack's view, forfeits their right to say you have no right to intervene at all. The truth of the matter, though, is that -- let's go back to John McCain's strategy. I never supported John McCain's strategy on the war. John McCain said exactly what Dick Cheney said. Go back and look at Barack Obama's statements and mine. Go look at JoeBiden.com -- contemporaneously held hearings in the summer before we went to war, saying if we went to war we would not be greeted as liberators, we would have a fight between the Sunnis and Shi'as, we would be tied down for a decade, it would cost us hundreds of billions of dollars. John McCain was saying the exact opposite. John McCain was lockstep with Dick Cheney at that point about how this was going to be easy. So John McCain's strategy in this war -- not just whether or not to go, the actual conduct of the war -- has been absolutely wrong from the outset. John McCain was lockstep with Dick Cheney at that point about how this was going to be easy. So John McCain's strategy in this war -- not just whether or not to go, the actual conduct of the war -- has been absolutely wrong from the outset. less more

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Ah, say it ain't so, Joe. There you go again, pointing backwards again, though.

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Gwen, I hope we'll get back to education, because I don't know any government program that John is supporting -- not early education, more money for it. The reason No Child Left Behind was left behind was the money was left behind. We didn't fund it. But we can get back to that, I assume. With regard to the role of a vice president, I had a long talk, as I'm sure the governor did with her principal -- in my case, with Barack -- and let me tell you what Barack asked me to do. I have a history of getting things done in the United States Senate. John McCain would acknowledge that. My record shows that, on controversial issues. I would be the point person for the legislative initiatives in the United States Congress for our administration. I would also -- when asked if I wanted a portfolio, my response was no. But Barack Obama indicated to me he wanted me with him to help him govern. So every major decision he'll be making, I'll be sitting in the room to give him my best advice. He's president, not me. I'll give my best advice. And one of the things he said early on when he was choosing, he said he would pick someone who had an independent judgment, who wouldn't be afraid to tell him if he disagreed. That is sort of my reputation, as you know. So I -- I look forward to working with Barack and playing a -- a very constructive role in his presidency, bringing about the kind of change this country needs. less more

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Vice President Cheney's been the most dangerous vice president we've had probably in American history. He has -- he has -- the idea he doesn't realize that Article I of the Constitution defines the role of the vice president of the United States, that's the executive -- he works in the executive branch. He should understand that. Everyone should understand that. And the primary role of the vice president of the United States of America is to support the president of the United States of America, give that president his or her best judgment when sought, and as vice president to preside over the Senate only in a time when, in fact, there's a tie vote. The Constitution is explicit: the only authority the vice president has from the legislative standpoint is to vote only when there is a tie vote. He has no authority relative to the Congress. The idea he's part of the legislative branch is a bizarre notion invented by Cheney to aggrandize the power of a unitary executive, and look where it's gotten us. It has been very dangerous. less more

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People aren't looking for more of the same, they are looking for change. And John McCain has been the consummate maverick in the Senate over all these years. He's taken shots left and right from the other party and from within his own party because he's had to take on his own party when the time was right, when he recognized it was time to put partisanship aside and just do what was right for the American people. That's what I've done as governor also -- take on my own party when I had to and work with both sides of the aisle. In my Cabinet, appointing those who would serve regardless of party -- Democrats, Independents, Republicans, whatever it took to get the job done. Also, John McCain's maverick position that he's in, that's really propped up to and indicated by the supporters that he has. Look at Lieberman and Giuliani and Romney and Lingle and all of us who come from such a diverse background of policy and of partisanship, all coming together at this time recognizing he is the man that we need to leave in -- lead in these next four years, because these are tumultuous times. We have got to win the wars. We have got to get our economy back on track. We have got to not allow the greed and corruption on Wall Street anymore. And we have not got to allow the partisanship that has really been entrenched in Washington, D.C., no matter who's been in charge. When the Republicans were in charge, I didn't see a whole lot of progress there either; when the Democrats either, though, this go-round for the last two years. Change is coming, and John McCain is the leader of that reform. less more

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Yeah, I can. When I got to the United States Senate and went on the Judiciary Committee as a young lawyer, I was of the view and had been trained in the view that the only thing that mattered was whether or not a nominee appointed -- suggested by the president had a judicial temperament, had not committed a crime of moral turpitude, and was -- had been a good student. And it didn't take me long -- it was hard to change, but it didn't take me long, but it took about five years for me to realize that the ideology of that judge makes a big difference. That's why I led the fight against Judge Bork. Had he been in the court, I suspect there would be a lot of changes that I don't like and the American people wouldn't like, including everything from Roe v. Wade to issues relating to civil rights and civil liberties. And so that -- that -- that -- that was one of the intellectual changes that took place in my career, as I got a close look at it. And that's why I was the first chairman of the Judiciary Committee to forthrightly state that it matters what your judicial philosophy is; the American people have a right to understand it and to know it. But I did change on that, and -- and I'm glad I did. less more

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You do what I did as governor and you appoint people regardless of party affiliation -- Democrats, independents, Republicans. You -- you walk the walk. You just don't just talk the talk. And even in my own family, it's a very diverse family, and we have folks of all political persuasion in there also. So I've grown up just knowing that, you know, at the end of the day, as long as we're all working together for the greater good, it's going to be okay. But the policies and the proposals have to got to speak for themselves also. And again, voters on November 4th are going to have that choice to either support a ticket, support policies that create jobs -- you do that by lowering taxes on American workers and on our businesses, and you build up infrastructure, and you rein in government spending, and you make our -- our nation energy-independent -- or you support a ticket that supports policies that will kill jobs by increasing taxes -- and that's what the track record shows, is a desire to increase taxes, increase spending -- a trillion-dollar spending proposal that's on the table, that's going to hurt our country -- and saying no to energy independence -- clear choices on November 4th. less more

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Senator, we have one minute for a discussion here. Obviously, the powers of the Treasury secretary have been greatly expanded, the most powerful officer in the Cabinet now. Hank Paulson says he won't stay on. Who do you have in mind to appoint to that very important post? (Pause.) Senator McCain? less more

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You know, that's a tough question. And there's a lot of qualified Americans. But I think the first criteria, Tom, would have to be somebody who immediately Americans identify with, immediately say, we can trust that -- that individual. Supporter of Senator Obama's is Warren Buffet. He's already weighed in and helped stabilize some of the difficulties in the markets and with companies and corporations, institutions today. I like Meg Whitman. She knows what it's like to be out there in the marketplace. She knows how to create jobs. Meg Whitman was the CEO of a company that started with 12 people and is -- now 1.3 million people in America make their living off eBay. Maybe somebody here has done a little business with them. But the point is, it's going to have to be somebody who inspires trust and confidence, because the problem in America today, to a large extent, Tom, is that we don't have trust and confidence in our institutions because of the corruption on Wall Street and the greed and excess and the cronyism in Washington, D.C. less more

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Well, Oliver, first let me tell you what's in the rescue package for you. Right now, the credit markets are frozen up. And what that means as a practical matter is that small businesses and some large businesses just can't get loans. If they can't get a loan, that means that they can't make payroll. If they can't make payroll, then they may end up having to shut their doors and lay people off. And if you imagine just one company trying to deal with that, now imagine a million companies all across the country. So it could end up having an adverse affect of everybody. And that's why we had to take action, but we shouldn't have been there in the first place. Now, I've got to correct a little bit of Senator McCain's history, not surprisingly. Let -- let's first of all understand that the biggest problem in this whole process was the deregulation of the financial system. Senator McCain, as recently as March, bragged about the fact that he is a deregulator. On the other hand, two years ago I said that we've got a subprime lending crisis that has to be dealt with. I wrote to Secretary Paulson, I wrote to Federal Reserve Chairman Bernanke, and told them this is something we have to deal with, and nobody did anything about it. A year ago I went to Wall Street and said we've got to reregulate. And nothing happened. And Senator McCain during that period said that we should keep on deregulating because that's how the free enterprise system works. Now, with respect to Fannie Mae, what Senator McCain didn't mention is the fact that this bill that he talked about wasn't his own bill. He jumped on it a year after it had been introduced, and it never got passed. And I never promoted Fannie Mae. In fact, Senator McCain's campaign chairman's firm was a lobbyist on behalf of Fannie Mae, not me. So -- but look, you're not interested in hearing politicians pointing fingers. What you're interested in is trying to figure out how is this going to impact you. This is not the end of the process, this is the beginning of the process. And that's why it's going to be so important for us to work with homeowners to make sure that they can stay in their homes. The secretary already has the power to do that in the rescue package, but it hasn't been exercised yet. And the next president has to make sure that the next Treasury secretary is thinking about how to strengthen you as a home buyer, you as a homeowner, and not simply think about bailing out banks on Wall Street. less more

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I think it depends on what we do. I think if we act effectively -- if we stabilize the housing market, which I believe we can if we go out and buy up these bad loans so that people can have a new mortgage at the new value of their home; I think if we get rid of the cronyism and special interest influence in Washington so we can act more effectively -- my friend, I'd like you to see the letter that a group of senators and I wrote warning exactly of this crisis. Senator Obama's name was not on that letter. The point is -- the point is that we can fix our economy. Americans -- workers are the best in the world. They're the fundamental aspect of America's economy. They're the most innovative. They're the best -- they're most -- best -- we're the best exporters. We're the best importers. They're most effective. They are the best workers in the world. And we got to give them a chance. They got -- we got to give them a chance to do their best again. less more

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We're going to have to prioritize, just like a family has to prioritize. Now, I've listed the things that I think have to be at the top of the list. Energy we have to deal with today, because you're paying 3.80 here in Nashville for gasoline, and it could go up. And it's a strain on your family budget, but it's also bad for our national security, because countries like Russia and Venezuela and, you know, in some cases countries like Iran are benefitting from higher oil prices. So we've got to deal with that right away. That's why I've called for an investment of $15 billion a year over 10 years. Our goal should be, in 10 years' time, we are free of dependence on Middle Eastern oil, and we can do it. When JFK said we're going to the Moon in 10 years, nobody was sure how to do it. But we understood that if the American people make a decision to do something, it gets done. So that would be priority number one. Health care is priority number two, because that broken health care system is bad not only for families, but it's making our businesses less competitive. And number three, we've got to deal with education so that our young people are competitive in a global economy. But just one point I want to make, Tom. Senator McCain mentioned looking at our records. We do need to look at our records. Senator McCain likes to talk about earmarks a lot, and that's important -- I want to go line by line through every item in the federal budget and eliminate programs that don't work, and make sure that those that do work work better and cheaper. But understand this: we also have to look at where some of our tax revenues are going. So when Senator McCain proposes a $300 billion tax cut -- a continuation not only of the Bush tax cuts but an additional $200 billion that he's going to give to big corporations, including big oil companies, $4 billion worth -- that's money out of the system. And so we've got to prioritize both our spending side and our tax policies to make sure that they're working for you. That's what I'm going to do as president of the United States. less more

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You know, a lot of you remember the tragedy of 9/11 and where you were on that day and, you know, how all of the country was ready to come together and make enormous changes to make us not only safer but to make us a better country and a -- and a -- and a more unified country. And you know, President Bush did some smart things at the outset, but one of the opportunities that was missed when he spoke to the American people, he -- he said: Go out and shop. That wasn't the kind of call to service that I think the American people were looking for. And so, you know, it's important to understand that the -- I think the American people are hungry for the kind of leadership that is going to tackle these problems not just in government but outside of government. And let's take the example of energy, which we already spoke about. There is going to be the need for each and every one of us to start thinking about how we use energy. I believe in the need for increased oil production. We're going to have to explore new ways to get more oil, and that includes offshore drilling. It includes telling the oil companies, that currently have 68 million acres that they're not using, that either you use them or you lose them. We're going to have to develop clean coal technology and safe ways to store nuclear energy. But each and every one of us can start thinking about how can we save energy in our homes and in our buildings. And one of the things I want to do is make sure that we're providing incentives so that you can buy a fuel-efficient car that's made right here in the United States of America, not in Japan or South Korea; making sure that you are able to weatherize your home or make your business more fuel- efficient. And that's going to require effort from each and every one of us. And the last point I just want to make. I think the young people of America are especially interested in how they can serve. And that's one of the reasons why I'm interested in doubling the Peace Corps, making sure that we are creating a -- a volunteer corps all across this country that can be involved in their community, involved in military service, so that military families and our troops are not the only ones bearing the burden of renewing America. That's something that all of us have to be involved with, and that requires some leadership from Washington. less more

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You know, nailing down Senator Obama's various tax proposals is like nailing Jell-O to the wall. There's been five or six of them. And if you wait long enough, there will probably be another one. But he wants to raise taxes. My friends, the last president to raise taxes during tough economic times was Herbert Hoover. And he practiced protectionism as well which, I'm sure, we'll get to at some point. You know, last year, up to this time, we've lost 700,000 jobs in America. The only bright spot is that 300 -- over 300,000 jobs have been created by small businesses. Senator Obama's secret that you don't know is that his tax increases will increase taxes on 50 percent of small-business revenue. Small businesses across America will -- will have to cut jobs and will have their taxes increase and won't be able to hire because of Senator Obama's tax policies. You know, he said some time ago -- he said he would forego his tax increases if the economy was bad. I got some news, Senator Obama: the news is bad. So let's not raise anybody's taxes, my friends, and make it be very clear to you I am not in favor of tax cuts for the wealthy. I am in favor of leaving the tax rates alone and reducing the tax burden on middle-income Americans by doubling your tax exemption for every child from $3,500 to $7,000; to giving every American a $5,000 refundable tax credit and go out and get the health insurance you want, rather than mandates and fines for small businesses as Senator Obama's plan calls for. And let's create jobs and let's get our economy going again, and let's not raise anybody's taxes. less more

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This is one of the biggest challenges of our times, and it is absolutely critical that we understand this is not just a challenge, it's an opportunity, because if we create a new energy economy, we can create 5 million new jobs easily here in the United States. It can be an engine that drives us into the future the same way the computer was the engine for economic growth over the last couple of decades. And we can do it, but we're going to have to make an investment. The same way the computer was originally invented by a bunch of government scientists who were trying to figure out, for defense purposes, how to communicate, we've got to understand this is a national security issue as well. And that's why we've got to make some investments. And I've called for investments in solar, wind, geothermal. Contrary to what Senator McCain keeps on saying, I favor nuclear power as one component of our overall energy mix. But this is another example where I think it is important to look at the record. Senator McCain and I actually agree on something. He said a while back that the big problem with energy is that for 30 years politicians in Washington haven't done anything. What Senator McCain doesn't mention is, he's been there 26 of them. And during that time, he voted 23 times against alternative fuels. Twenty-three times. So it's easy to talk about this stuff during a campaign, but it's important for us to understand that it requires a sustained effort from the next president. One last point I want to make on energy. Senator McCain talks a lot about drilling, and that's important. But we have 3 percent of the world's oil reserves and we use 25 percent of the world's oil. So what that means is that we can't simply drill our way out of the problem. And we're not going to be able to deal with the climate crisis if our only solution is to use more fossil fuels that create global warming. We're going to have to come up with alternatives, and that means that the United States government is working with the private sector to fund the kind of innovation that we can then export to countries like China that also need energy and are setting up one coal power plant a week. We've got to make sure that we're giving them the energy that they need or -- or helping them to create the energy that they need. less more

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I think pure research and development investment on the part of the -- of the United States government is certainly appropriate. I think once it gets into productive stages that we ought to obviously turn it over to the private sector. By the way, my friends, I, I know you grow a little weary of this back and forth. There was an energy bill on the floor of the Senate loaded down with goodies, billions for the oil companies. And it was sponsored by Bush and Cheney. You know who voted for it? You might never know. That one. You know who voted against it? Me. I have fought time after time against these pork barrel -- these, these, these bills that come to the floor. And they have all kinds of goodies and all kinds of things in them, for everybody, and they buy off the votes. I vote against them, my friends. I vote, I vote against them. But the point is also on oil drilling, oil drilling offshore now is vital, so that we can bridge the gap. We can bridge the gap between imported oil which is, which is a national security issue as well as any other. And it will reduce the price of a barrel of oil, because when people know there's a greater supply, then the cost of that will go down. That's fundamental economics. We've got to drill offshore, my friends, and we've got to do it now. And we can do it. And as far as nuclear power is concerned again, again look at the record. Senator Obama has approved storage and, and reprocessing of spent nuclear fuel. And I'll stop, Tom, and you didn't even wave. Thanks. less more

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Well, thank you for the question. You -- you -- you really identified one of the really major challenges that America faces. Copayments go up, costs go up -- skyrocketing costs which make people less and less able to afford health insurance in America -- and we need to do all of the things that are necessary to make it more efficient. Let's put health records online. That'll reduce medical errors, as -- as they call them. Let's have community health centers. Let's have walk-in clinics. Let's do a lot of things to impose efficiencies. But what is at -- at stake here in this health care issue is the fundamental difference between myself and Senator Obama. As you noticed, he starts talking about government. He's talked -- said government will do this and government will do that and then government will -- and he'll impose mandates. If you're a small business person, and you don't insure your employees, Senator Obama will fine you, will fine you. That's remarkable. If you're a parent and you're struggling to get health insurance for your children, Senator Obama will fine you. I want to give every American a $5,000 refundable tax credit they can take anywhere, across state lines. Why not? Don't we go across state lines when we purchase other things in America? Of course it's okay to go across state lines, because in Arizona they may offer a -- a better plan that suits you best than it does here in Tennessee. And if you do the math, those people who have employer-based health benefits -- if you put the tax on it, and you have what's left over, and you add $5,000 that you're going to get as a refundable tax credit, do the math. Ninety-five percent of the American people will have increased funds to go out and buy the insurance of their choice and to shop around and to get -- all those people will be covered, except for those who have these gold-plated Cadillac kinds of policies -- you know, like hair transplants. I might need one of those myself. But the point is that we have got to give people choice in America and not mandate things on them, and give them the ability -- every parent I know would -- would acquire health insurance for their children if they could. Obviously small-business people want to give their employees health insurance. Of course they all want to do that. We've got to give them the wherewithal to do it. We can do it by giving them, as a start, a $5,000 refundable tax credit to go around and get the health insurance policy of their choice. less more

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Well, I think it should be a right for every American. In a country as wealthy as ours, for us to have people who are going bankrupt because they can't pay their medical bills -- for or my mother to die of cancer at the age of 53 and have to spend the last months of her life in a hospital room arguing with insurance companies, because they're saying that this may be a preexisting condition and they don't have to pay her treatment, there's something fundamentally wrong about that. So let me, let me just talk about this fundamental difference. Tom, I know that we're under time constraints, but Senator McCain threw a lot of stuff out there. Number one, let me just repeat, if you've got a health care plan that you like, you can keep it. All I'm going to do is help you to lower the premiums on it. You'll still have choice of doctor. There's no mandate involved. Small businesses are not going to have a mandate. What we're going to give you is a 50 percent tax credit to help provide health care for those that you need. Now, it's true that I say that you are going to have to make sure that your child has health care, because children are relatively cheap to insure, and we don't want them going to the emergency room for treatable illnesses like asthma. When Senator McCain says that he wants to provide children health care, what he doesn't mention is, he voted against the expansion of the Children's Health Insurance Program that is responsible for making sure that so many children who didn't have previously health insurance have it now. Now, the final point I'll make on this whole issue of government intrusion and mandates -- it is absolutely true that I think it is important for government to crack down on insurance companies that are cheating their customers, that don't give you the fine print. So you end up thinking that you're paying for something, and when you finally get sick and you need it, you're not getting it. And the reason that it's a problem to go shopping state by state -- you know what insurance companies will do? They will find a state -- maybe Arizona, maybe another state -- where there are no requirements for you to get cancer screenings, where there are no requirements for you to have to get preexisting conditions, and they will all set up shop there. That's how in banking it works. Everybody goes to Delaware because they've got pretty loose laws when it comes to things like credit cards. And in that situation -- less more

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I mean, not true. Not true. I have obviously supported those efforts that the United States had to go in militarily, and I have opposed those that I didn't think so. I understand what it's like to send young Americans into harm's way. I say -- I was joking with a veteran -- I hate to even go into this -- I was joking with an old veteran friend who joked with me about Iran. But the point is that I know how to handle these, these, these crises. And Senator Obama, by saying that he would attack Pakistan -- look at the context of his words. I'll get Osama bin Laden, my friends. I'll get him. I know how to get him. I'll get him no matter what. And I know how to do it. But I'm not going to telegraph my punches, which is what Senator Obama did. And I'm going to act responsibly as I have acted responsibly throughout my military career and throughout my career in the United States Senate. And we have fundamental disagreements about the use of military power and how you do it. And you just saw it in response to previous questions. less more

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Well, the resurgence of Russia is one of the central issues that we're going to have to deal with in the next presidency. And for the most part, I agree with Senator McCain on many of the steps that have to be taken. But we can't just provide moral support. We've got to provide moral support to the Poles and Estonia and Latvia and all the nations that were former Soviet satellites, but we've also got to provide them with financial and concrete assistance to help rebuild their economies. Georgia in particular is now -- (inaudible) -- of enormous economic challenges. And some say that that's what Putin intended in the first place. The other thing we have to do, though, is we've got to see around the corners. We've got to anticipate some of these problems ahead of time. You know, back in April, I put out a statement saying that the situation in Georgia was unsustainable because you had Russian peacekeepers in these territories that were under dispute. And you knew that if the Russians themselves were trying to obtain some of these territories or push back against Georgia, that that was not a stable situation. So part of the job of the next commander in chief in keeping all of you safe is making sure that we can see some of the 21st-century challenges and anticipate them before they happen. We haven't been doing enough of that. We tend to be reactive; that's what we've been doing over the last eight years. And that has actually made us more safe. That's part of what happened in Afghanistan, where we rushed into Iraq. And Senator McCain and President Bush suggested that it wasn't that important to catch bin Laden right now and that we could muddle through, and that has cost us dearly. We've got to be much more strategic if we're going to be able to deal with all the challenges that we face out there. And one last point I want to make about Russia, energy is going to be key in dealing with Russia. If we can reduce our energy consumption, that reduces the amount of petro-dollars that they have the -- to make mischief around the world. That will strengthen us and weaken them when it comes to issues like Georgia. less more

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My wife, Michelle, is there, and she could give you a much longer list than I do. (Laughter.) And most of the time, I learn it by asking her. But look, the nature of the challenges that we're going to face are immense. And one of the things that we know about the presidency is that it's never the challenges that you expect, it's the challenges that you don't that end up consuming most of your time. But here's what I do know. I know that I wouldn't be standing here if it weren't for the fact that this country gave me opportunity. You know, I came from very modest means. I had a single mom, and my grandparents raised me, and it was because of the help of scholarships and my grandmother scrimping on things that, you know, she might have wanted to purchase, and my mom at one point getting food stamps in order for us to put food on the table. Despite all that, I was able to go to the best schools on Earth. I was able to succeed in a way that I could not have succeeded anywhere else in this country. The same is true for Michelle, and I'm sure the same is true for a lot of you. And the question in this election is, are we going to pass on that same American dream to the next generation? Over the last eight years, we've seen that dream diminish. Wages and incomes have gone down. People have lost their health care or are going bankrupt because they get sick. We've got young people who have got the grades and the will and the drive to go to college. But they just don't have the money. And we can't expect that if we do the same things that we've been doing, over the last eight years, that somehow we are going to have a different outcome. We need fundamental change. That's what's at stake in this election. That's the reason I decided to run for president. And I'm hopeful that all of you are prepared to continue this extraordinary journey that we call America. But we're going to have to have the courage and the sacrifice, the nerve to move in a new direction. Thank you. less more

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Well, let me -- let me say, Bob, thank you. And thanks to Hofstra. And by the way, our beloved Nancy Reagan is in the hospital tonight, so our thoughts and prayers are going with you. It's good to see you again, Senator Obama. Americans are hurting right now, and they're angry. They're hurting and they're angry. They're innocent victims of greed and excess on Wall Street and as well as Washington, D.C. And they're angry and they have every reason to be angry. And they want this country to go in a new direction. And there are elements of my proposal that you just outlined, which I won't repeat. But we also have to have a short-term fix, in my view, and long-term fixes. Let me just talk to you about one of the short-term fixes. The catalyst for this housing crisis was the Fannie and Freddie Mae that caused the subprime lending situation that now cause the housing market in America to collapse. I am convinced that until we reverse this continued decline in homeownership and put a floor under it, and so that people have not only the hope and belief they can stay in their homes and realize the American dream, but that value will come up. Now, we have allocated $750 billion. Let's take 300 of that billion and go in and buy those home-loan mortgages and negotiate with those people in their homes, 11 million homes or more, so that they can afford to pay the mortgage, stay in their home. Now, I know the criticism of this. Well, what about the citizen that stayed in their homes, that -- that -- that paid their mortgage payments? It doesn't help that person in their home if the -- if the next door neighbor's house is abandoned. And so we've got to reverse this. We ought to put the homeowners first. And I am disappointed that Secretary Paulson and others have not made that their first priority. less more

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Well, first of all, I want to thank Hofstra University and the people of New York for hosting this tonight. And it's wonderful to join Senator McCain again. And thank you, Bob. I think everybody understands at this point that we are experiencing the worst financial crisis since the Great Depression. And the financial rescue plan that Senator McCain and I supported is a important first step and I pushed for some core principles: making sure the taxpayers can get their money back if they're putting money up, making sure that CEOs are not enriching themselves through this process. And I think that it's going to take some time to work itself out. But what we haven't yet seen is a rescue package for the middle class, because the fundamentals of the economy were weak even before this latest crisis. So I've proposed four specific things that I think can help. Number one, let's focus on jobs. I want to end the tax breaks for companies that are shipping jobs overseas and provide a tax credit for every company that's creating a job right here in America. Number two, let's help families right away by providing them a tax cut, a middle-class tax cut for people making less than $200,000. And let's allow them to access their IRA accounts without penalty if they're experiencing a crisis. Now, Senator McCain and I agree with your idea that we've got to help homeowners. That's why we included in the financial package a proposal to get homeowners in a position where they can renegotiate their mortgages. I disagree with Senator McCain in how to do it because the way Senator McCain has designed his plan, it could be a giveaway to banks if we're buying full-price for mortgages that now are worth a lot less, and we don't want to waste taxpayer money. And we've got to get the financial package working much quicker than it's been working. The last point I want to make, though -- we've got some long-term challenges in this economy that have to be dealt with. We've got to fix our energy policy that's giving our wealth away. We've got to fix our health care system, and we've got to invest in our education system for every young person to be able to learn. less more

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He's been watching some ads of Senator McCain's. Let me tell you what I'm actually going to do. I think tax policy is a major difference between Senator McCain and myself. And we both want to cut taxes. The difference is, who we want to cut taxes for. Now, Senator McCain -- the centerpiece of his economic proposal is to provide $200 billion in additional tax breaks to some of the wealthiest corporations in America. ExxonMobil and other oil companies, for example, would get an additional $4 billion in tax breaks. What I have said is I want to provide a tax cut for 95 percent of working Americans -- 95 percent. If you make more -- if you make less than a quarter-million dollars a year, then you will not see your income tax go up, your capital gains tax go up, your payroll tax -- not one dime. And 95 percent of working families -- 95 percent of you out there -- will get a tax cut. In fact, independent studies have looked at our respective plans and have concluded that I provide three times the amount of tax relief to middle-class families than Senator McCain does. Now, the conversation I had with Joe the plumber, what I essentially said to him was, five years ago, when you were in the position to buy your business, you needed a tax cut then. And what I want to do is to make sure that the plumber, the nurse, the firefighter, the teacher, the young entrepreneur who doesn't yet have money, I want to give them a tax break now. And that requires us to make some important choices. Last point I'll make about small businesses -- not only do 98 percent of small businesses make less than $250,000, but I also want to give them additional tax breaks because they are the drivers of the economy. They produce the most jobs. less more

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-- in order to give -- in order to give additional tax cuts to Joe the plumber before he was at the point where he could make $250,000. Then ExxonMobil, which made $12 billion -- record profits -- over the last several quarters, they can afford to pay a little more so that ordinary families who are hurting out there, they -- they're trying to figure out how they're going to afford food, how they're going to save for their kids' college education -- they need a break. So, look, nobody likes taxes. I would prefer that none of us had to pay taxes, including myself. But ultimately we've got to pay for the core investments that make this economy strong, and somebody's got to do it. less more

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Okay. All right. Energy -- on -- well, first -- second of all, energy-independent -- we have to nuclear power. We have to stop sending $700 billion a year to countries that don't like us very much. It's wind, tide, solar, natural gas, nuclear, offshore drilling, which Senator Obama has opposed. And the point is that we become energy-independent, and we will create millions of jobs, millions of jobs in America. Okay. What -- what would I cut? I would have, first of all, an across-the-board spending freeze, okay? That -- some people say that's a hatchet. That's a hatchet, and then I would get out a scalpel, okay, because we've got -- we have presided over the largest increase -- we got to have new direction for this country. We have presided over the largest increase in government since the Great Society. Government spending has gone completely out of control. Ten trillion dollar debt we're giving to our kids; a half a trillion dollars we owe China. I know how to save billions of dollars in defense spending. I know how to eliminate programs. I have fought against -- less more

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Well, I mean, look, if we want to talk about Congressman Lewis, who is an American hero, he -- unprompted by my campaign, without my campaign's awareness -- made a statement that he was troubled with what he was hearing at some of the rallies that your running mate was holding, in which all the public reports indicated were shouting, when my name came up, things like "terrorist" and "Kill him," and that your running mate didn't mention -- didn't stop, didn't say, "Hold on a second. That's kind of out of line." And I think Congressman Lewis's point was that we have to be careful about how we deal with our supporters. less more

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-- my response. I do think that he inappropriately drew a comparison between what was happening there and what had happened during the civil rights movement. And we immediately put out a statement saying that we don't think that comparison is appropriate. And in fact, afterwards, Congressman Lewis put out a (similar ?) statement saying that he had probably gone over the line. The important point here is, though, the American people have become so cynical about our politics because all they see is a tit for tat and back and forth. And what they want is the ability to just focus on some really big challenges that we face right now. And that's what I have been trying to focus on this entire campaign. less more

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So the point is -- the point is that I have repudiated every time someone has been out of line, whether they've been part of my campaign or not. And I will continue to do that. But the -- but the fact is that we need to absolutely not stand for the kind of things that have been going on. I haven't. less more

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You know, I think it's -- that's going to be up to the American people. I think that obviously she's a capable -- (audio break) -- has, I think, excited the -- a base in the Republican Party. And I think it's very commendable -- the work she's done on behalf of special needs. I agree with that, John. I do want to just point out that autism, for example, or other special needs will require some additional funding if we're going to get serious in terms of research. That is something that every family that advocates on behalf of disabled children talk about. And if we have a across-the-board spending freeze, we're not going to be able to do it. That's an example of, I think, the kind of -- the use of the scalpel that we want to make sure that we're funding some of those programs. less more

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Oh, I think that Joe Biden is qualified in many respects, but I do point out that he's been wrong on many foreign policy and national security issues, which is supposed to be his strength. He voted against the first Gulf War. He voted against it, and obviously we had to take Saddam Hussein out of Kuwait or it would have threatened the Middle Eastern oil supply. In Iraq, he had this cockamamie idea about dividing Iraq into three countries. We're seeing Iraq united as Iraqis. It's tough, hard -- but we're seeing them -- we're now about to have an agreement for status of forces in Iraq coming up. There are several issues in which, frankly, Joe Biden and I openly and honestly disagreed on national security policy. And he's been wrong on a number of the major ones. But again, I want to come back to -- you know, notice, every time, Senator Obama says, "We need to spend more. We need to spend more. That's the answer." Why do we always have to spend more? Why can't we have transparency, accountability, reform of these agencies of government? Maybe that's why he's asked for 860 -- sought and proposed $860 billion worth of new spending and -- and wants to raise people's taxes in a time of incredible challenge and difficulty and heartache for the American families. less more

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I believe we can, for all intents and purposes, eliminate our dependence on Middle Eastern oil and Venezuelan oil. Canadian oil is fine. By the way, when Senator Obama said he would unilaterally renegotiate the North American Free Trade Agreement, the Canadians said, yeah, and we'll sell our -- our oil to China. You don't tell countries you're going to unilaterally renegotiate agreements with them. We can eliminate our dependence on foreign oil by building 45 new nuclear power plants right away. We can store and we can reprocess. Senator Obama will tell you, in the -- as the extreme environmentalists do, it has to be safe. Look, we've sailed Navy ships around the world for 60 years with nuclear power plants on them. We can store and reprocess spent nuclear fuel, Senator Obama, no problem. So the point is, with nuclear power, with wind, tides, solar, natural gas, with development of flex fuel, hybrid, clean coal technology. Clean coal technology is a key in the heartland of America that's hurting rather badly. So I think we can easily, within 7, 8, 10 years, if we put our minds to it, we can eliminate our dependence on the places in the world that harm our national security, if we don't achieve our independence from them. less more

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I -- I think that in 10 years we can reduce our dependence so that we no longer have to import oil from the Middle East or Venezuela. I think that's about a realistic time frame. And -- and this is the most important issue that our future economy is going to face. Obviously, we've got an immediate crisis right now, but nothing's more important than us no longer borrowing $700 billion or more from China and sending it to Saudi Arabia. It's mortgaging our children's future. Now, from the start of this campaign I've identified this as one of my top priorities, and here's what I think we have to do. Number one, we do need to expand domestic production. And that means, for example, telling the oil companies the 68 million acres that they currently have leased that they're not drilling, use 'em or lose 'em. And I think that we should look at offshore drilling and implement it in a way that allows us to get some additional oil. But understand, we only have 3 (percent) to 4 percent of the world's oil reserves and we use 25 percent of the world's oil, which means that we can't drill our way out of the problem. And that's why I focused on putting resources into solar, wind, biodiesel, geothermal. These have been priorities of mine since I got to the Senate, and it is absolutely critical we -- that we develop a high- fuel-efficient car that's built not in Japan and not in South Korea, but built here in the United States of America. We -- we invented the auto industry, and the fact that we have fallen so far behind is something that we have to work on. Now, I just want to make one last point because Senator McCain mentioned NAFTA and the issue of trade, and that actually bears on this issue. I believe in free trade, but I also believe that for far too long, certainly during the course of the Bush administration with the support of Senator McCain, the attitude's been that any trade agreement is a good trade agreement. And NAFTA doesn't have -- did not have enforceable labor agreements and environmental agreements, and what I said was we should incluse (sic) those and make them enforceable in the same way that we should enforce rules against China manipulating its currency to make our exports more expensive and their exports to us cheaper. And when it comes to South Korea, we've got a trade agreement up right now -- they are sending hundreds of thousands of South Korean cars into the United States -- that's all good -- we can only get 4(,000 to 5,000 into South Korea. That is not free trade. We've got to have a president who is going to be advocating on behalf of American businesses and American workers, and I make no apology for that. less more

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Let me respond. Actually I understand it pretty well. The history in Colombia right now is that labor leaders have been targeted for assassination, on a fairly consistent basis, and there have not been prosecutions. And what I have said, because the free trade -- the trade agreement itself does have labor and environmental protections -- but we have to stand for human rights and we have to make sure that violence isn't being perpetrated against workers who are just trying to organize for their rights, which is why, for example, I supported the Peruvian Free Trade Agreement, which was a well-structured agreement. But I think that the important point is we've got to have a president who understands the benefits of free trade, but also is going to enforce unfair trade agreements and is going to stand up to other countries. And last point I'll make, because we started on energy, you know, when I talked about the auto makers, they are obviously getting hammered right now. They were already -- already having a tough time because of high gas prices, and now, with the financial crisis, car dealerships are closing and people can't get car loans. That's why I think it's important for us to get loan guarantees to the auto makers. But we do have to hold them responsible, as well, to start producing the highly fuel-efficient cars of the future. And, you know, Detroit had dragged its feet too long in terms of getting that done. It's going to be one of my highest priorities, because transportation accounts for about 30 percent of our total energy consumption. If we can get that right, then we can move in a direction not only of energy independence, but we can create 5 million new jobs all across America, including in the heartland, where we can retool some of these plants to make these highly fuel-efficient cars, and also to make wind turbines and -- and solar panels, the kinds of clean energy approaches that should be the driver of our economy for the next -- for the next century. less more

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So the point is -- so --

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You won't pay a fine because -- zero -- because I -- as I said in our last debate -- and I'll repeat, John -- I exempt small businesses from the requirement for large businesses that can afford to provide health care to their employees but are not doing it. I exempt small businesses from having to pay into a kitty. But large businesses that can afford it -- we've got a choice. Either they provide health insurance to their employees or somebody has to. Right now what happens is those employees get dumped into either the Medicaid system, which taxpayers pick up, or they're going to the emergency room for uncompensated care, which everybody picks up in their premiums. The average family is paying an additional $900 a year in higher premiums because of the uninsured. So here's what we do. We exempt small businesses. In fact, what -- Joe, if you want to do the right thing with your employees and you want to provide them health insurance, we'll give you a 50 percent credit so that you will actually be able to afford it. If you don't have health insurance or you want to be able to buy into a group plan, you will be able to buy into the plan that I just described. Now, what we haven't talked about is Senator McCain's plan. He says he's going to give you all a $5,000 tax credit. That sounds pretty good, and you can go out and buy your own insurance. Here's the problem: that for about 20 million people, you may find yourselves no longer having employer-based health insurance. This is because younger people might be able to get health insurance for ($)5,000, young and healthy folks; older folks, less-healthy folks, what's going to end up happening is that you're going to be the only ones left if your employer-based system, your employers won't be able to afford it. And once you're out on your own with this $5,000 credit, Senator McCain for the first time is going to be taxing the health care benefits that you have from your employer. And -- and this is your plan, John: for the first time in history, you will be taxing people's health care benefits. By the way, the average policy costs about $12,000. So if you got ($)5,000 and it's going to cost you ($)12,000, that's a loss for you. Last point about Senator McCain's plan is that insurers right now -- the main restrictions on what they do is primarily state law, and under Senator McCain's plan, those rules would be stripped away, and you would start seeing a lot more insurance companies cherry-picking and excluding people from coverage. That, I think, is a mistake. And you know, I think that this is a fundamental difference in our campaign and how we would approach health care. less more

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I think it was a bad decision. I thought it was a -- I thought it was a bad decisions. I think there was a lot of decisions that were bad. I think that the decision should rest in the hands of the states. I'm -- I'm a federalist. And I believe strongly that we should have nominees to the United States Supreme Court based on their qualifications rather than any litmus test. Now, let me say that there was a time, a few years ago, when the United States Senate was about to blow up. Republicans wanted to have just a majority vote to confirm a judge. And the Democrats were blocking in an unprecedented fashion. We got together, seven Republicans, seven Democrats. You were offered a chance to join. You chose not to because you were afraid of the appointment of, quote, "conservative" judges. I voted for Justice Breyer and Justice Ginsburg, not because I agreed with their ideology but because I thought they were qualified and that judge -- and that elections have consequences, when presidents are nominated. This is a very important issue we're talking about. Senator Obama voted against Justice Breyer and Justice Roberts on the grounds that they didn't meet his ideological standards. That's not the way we should judge these nominees. Elections have consequences. They should be judged on their qualifications. And so I -- that's what I will do. I will find the best people in the world -- in -- in the United States of America who have a history of strict adherence to the Constitution and -- less more

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Well, I think it's true that we shouldn't apply a strict litmus test and the most important thing in any judge is their capacity to -- to provide fairness and justice to the American people. And it is true that this is going to be, I think, one of the most consequential decisions of the next president. It is very likely that one of us will be making at least one and probably more than one appointments and Roe versus Wade probably hangs in the balance. Now, I would not provide a litmus test, but I am somebody who believes that Roe versus Wade was rightly decided. I think that abortion is a very difficult issue, and it is a moral issue and one that I think good people on both sides can disagree on. But what ultimately I believe is -- is that women, in consultation with their families, their doctors, their religious advisors -- are in a best position to make this decision. And I think that the Constitution has a right to privacy in it that shouldn't be subject to state referendum in the -- any more than, you know, our First Amendment rights are subject to state referendum, any more than, you know, many of the other rights that we have should be subject to, you know, popular vote. So this is going to be an important issue. I will look for those judges who have an outstanding judicial record, who have the intellect, and who hopefully have a sense of what real-word -- -world folks are going through. I'll just give you one quick example. Senator McCain and I disagreed recently when the Supreme Court made it more difficult for a woman named Lilly Ledbetter to press her claim for pay discrimination. For years she had been getting paid less than a man had been paid for doing the exact same job. And when she brought a suit saying, "Equal pay for equal work," the judges said, "Well, you know, it's taken you too long to bring this lawsuit," even though she didn't know about it until fairly recently. We tried to overturn it in the Senate. I supported that effort to provide better guidance to the courts. John McCain opposed it. I think that it's important for judges to understand that if a woman is out there trying to raise a family, trying to support her family, and is being treated unfairly, then the -- the court has to stand up if nobody else will, and -- less more

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Yeah, let -- let me respond to this. If -- if it sounds incredible that I would vote to withhold lifesaving treatment from an infant, that's because it's not true. The -- here are the facts. There was a bill that was put forward before the Illinois Senate that said you have to provide life-saving treatment and -- that would have helped to undermine Roe v. Wade. The fact is that there was already a law on the books in Illinois that required providing life-saving treatment, which is why not only myself, but pro-choice Republicans and Democrats voted against it. And the Illinois Medical Society, the organization of doctors in Illinois, voted against it. Their Hippocratic Oath would've required them to provide care, and there was already a law in the books. With respect to partial-birth abortion, I am completely supportive of a ban on late-term abortions, partial-birth or otherwise, as long as there's a exception for the mother's health and life. And this did not contain that exception. And I attempted, as many have in past, of including that so that it is Constitutional. And that was rejected. And that's why I voted "present," because I'm willing to support a ban on late-term abortions as long as we have that exception. Last point I want to make on the issue of abortion. This is an issue that -- look, it divides us, and in some ways, it may be difficult to reconcile the two views. But there surely is some common ground. When both those who believe in choice and those who are opposed to abortion can come together and say we should try to prevent unintended pregnancies by providing appropriate education to our youth, communicating that sexuality is sacred and that they should not be engaged in cavalier activity, and providing options for adoption and helping single mothers, if they want to choose to keep their baby. Those are all things that we put in the Democratic platform for the first time this year. And I think that's where we can find some common ground, because nobody is pro-abortion. I think -- (audio break) -- we should try to reduce these circumstances. less more