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The Situation Room

President Obama Leading in New Polls; Interview With Utah Congressman Jason Chaffetz, Obama Campaign Traveling Press Secretary Jen Psaki; What's Behind Obama's 6-Point Lead?; Book Chronicles Drama at Brink of Debt Default

Aired September 10, 2012 - 18:00   ET

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

WOLF BLITZER, CNN ANCHOR: Happening now: our new poll and the important bounce President Obama got from his convention.

A big shift in the campaign funding fight. Who's got more money and why it matters.

Plus, behind the scenes of the drama between the president and the speaker -- new details of how the U.S. wound up on a fiscal cliff.

I'm Wolf Blitzer. And you're in THE SITUATION ROOM.

They each took a turn in the spotlight hoping to build momentum for their campaign and now our brand-new CNN/ORC poll shows one of the presidential candidates got a significant bounce from his convention. That would be President Obama now leading Mitt Romney by six points.

Our chief national correspondent, John King, is over at our magic wall for us.

John, break down the new numbers for us.

JOHN KING, CNN CHIEF NATIONAL CORRESPONDENT: We will dig deep, Wolf.

Important to remember, we elect presidents state by state. National polls sometimes can be misleading. But this is a big bounce for the president. Let's take a look at the reasons behind it.

First, let's just take a look at the numbers. Here's what the our poll shows and this is among likely voters. That's important. The president at 52 percent. Governor Romney at 46 percent. Heading in to the Democratic Convention, we had a dead heat among likely voters and just before the Republican Convention, the president had a slight edge, but that's essentially a tie, we went from a tie and a tie to a breakaway lead for the president plus six now in the latest poll.

So what's behind it? Still a huge gender gap for the president among women, but look at this, Governor Romney has consistently led among men. In our new poll, Wolf, among likely voters, a tie essentially, a one-point lead for the president. But that's a statistical tie. Last week you see the lead here. Governor Romney with a 12-point lead among men.

You want to look at what's driving this beyond that. Let's look at some of the key issues in the poll. We pop it out. Takes a little bit of a nudge here. If you look here, who's best in touch with the problems faced by the middle class? A key question in an election dominated by the economy.

Look at this right now. Among likely voters post-Democratic Convention, the president with a 20-point lead on the big question. Heading in to the convention, he was up just six points. The Democrats scored big addressing the problems of the middle class at their convention.

Another big one here, which candidate most shares your values? Again these are likely voters, Wolf. The president with an edge now, a seven-point edge. Just before both conventions, we last asked this question before the Republican Convention. Just before that, essentially a statistical tie. Again big jump on values, shares your values and in touch with the middle class.

If voters are sitting around the kitchen table to make their choice and they say what are the issues we want to go through and who do we favor on those issues, look at this. The president and Governor Romney tie on the economy. Governor Romney had been leading in that category, and then on foreign policy, Medicare, health care, all big themes of the Democratic Convention, the president leads. On taxes, another big theme of the Democratic Convention, the president leads.

Only on the deficit, Wolf, is Governor Romney ahead.

BLITZER: It obviously looks pretty good at least right now for the president. What is the Romney camp saying about all of this?

KING: They anticipated some of the numbers were coming. I suspect because they see it in their own numbers.

The Romney campaign's pollster, Neil Newhouse, sent out a memo this morning saying he calls it a sugar high, meaning he believes it's temporary. He says Democrats have rallied to the president's side and it will fade in time. And they do have a point. Again, we elect presidents state by state. No question. Looking at the middle class, shares our value, that issues scorecard I just showed you, this is an important gain for the president.

The question is, is it permanent or temporary? What the Romney campaign would tell you they say when they look at their polling in key battleground states like Florida, like Ohio, Virginia, North Carolina, they say, if the president is ahead in those states, only a point or two and they say still a dead heat when it comes to the battlegrounds.

But we will watch the numbers. One thing we should look for in the days ahead, when we start to see some post-convention polls from the battleground states.

BLITZER: We got debates coming up in October as well. John, thanks very, very much.

More on the Romney campaign and what it's saying about the poll results right now. They're dismissing as John reported all the positive numbers for the president as a "sugar high."

Our national political correspondent, Jim Acosta, is out on the campaign trail in Ohio with the Republican presidential nominee -- Jim.

(BEGIN VIDEOTAPE)

JIM ACOSTA, CNN CORRESPONDENT: Wolf, the CNN/ORC numbers are just the latest in a string of polls showing Mitt Romney falling behind President Obama. But if the GOP contender is worried about that, he's not showing it.

(voice-over): Mitt Romney was all confidence as he returned to the battleground state of Ohio.

MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: He went out with his campaign slogan. You know what it is. He says forward. Forward is his campaign slogan. I think forewarned is a better term.

(LAUGHTER)

ACOSTA: But recent polls, including new numbers from CNN/ORC showing the president pulling ahead by six points, prompted the Romney campaign to issue this polling memo to donors and supporters.

In it, Romney's chief pollster writes, "Don't get too worked up about the latest polling. While some voters will feel a bit of a sugar high from the conventions, the basic structure of the race has not changed. Mitt Romney will win this race."

The Obama campaign also came out with new fund-raising numbers for August, revealing it beat Romney in a monthly money haul for the first time since spring. To blunt that momentum, Romney and running mate Paul Ryan hit the Sunday talk show circuit, where the GOP nominee offered a more surgical take on health care.

ROMNEY: I'm not getting rid of all of health care reform. Of course, there are a number of things I like in health care reform that I'm going to put in place.

ACOSTA: Romney said he wants to make sure people with preexisting conditions can obtain insurance. It's a nuance he's repeated before, but only on a few instances. More typical is how he condemned the health care law after it was upheld by the Supreme Court.

ROMNEY: Help us defeat the Obamacare. Help us defeat the liberal agenda that makes government too big, too intrusive and that's killing jobs across this great country.

ACOSTA: Romney and Ryan also both declined to specify loopholes they would close to help pay for their proposed tax cuts. DAVID GREGORY, MODERATOR, "MEET THE PRESS": Can you give me an example of a loophole that you will close.

ROMNEY: Well, I can tell you that people at the high end, high- income taxpayers, are going to have fewer deductions and exemptions.

ACOSTA: The responses were spun into a new Obama Web video.

GEORGE STEPHANOPOULOS, ABC NEWS: Don't voters have a right to know which loopholes you're going to go after?

REP. PAUL RYAN (R-WI), VICE PRESIDENTIAL CANDIDATE: Mitt Romney and I, based on our experience, think the best way to do this is to show the framework, show the outlines of these plans.

ACOSTA: Republicans are pointing to a new Bob Woodward book, "The Price of Politics," which details the breakdown between the White House and Congress that nearly led to a debt default.

In a section from the book adapted for "The Washington Post," Woodward writes: "It was increasingly clear that no one was running Washington. That was trouble for everyone, but especially for Obama."

(on camera): Despite the latest poll numbers, a top Romney adviser says the campaign is -- quote -- "in a great position." With less than 60 days to go, the campaign believes the race will come down to the economy, an issue top aides say gives Romney the edge -- Wolf.

(END VIDEOTAPE)

BLITZER: Jim Acosta traveling with Mitt Romney, thanks very much.

(NEWS BREAK)

BLITZER: Millions and millions of desperately needed new jobs. President Obama and Mitt Romney both say they have plans to create them, but how? We go in depth next.

(COMMERCIAL BREAK)

BLITZER: You hear the poll numbers, the campaign speeches, but when voters go to the polls, what matter most?

All this week, CNN is going in-depth on the major issues right at the center of the presidential campaign, today, America's jobs crisis. Both President Obama and Governor Romney say they will create more jobs , but how?

CNN's Christine Romans takes a closer look in depth.

(BEGIN VIDEOTAPE)

CHRISTINE ROMANS, CNN CORRESPONDENT (voice-over): Over 8 percent unemployment, five million without work for six months or longer, more than eight million only working part-time. If there's one thing Mitt Romney and Barack Obama can agree on, the economy and, more specifically, the jobs crisis in America, is the issue of this race.

Mitt Romney's philosophy, let the private sector create new jobs. President Obama agrees, but thinks the federal government must play a larger role by investing in programs that may pay off in the future.

Romney advisers also claim their plans will ad another seven million jobs over the decade.

ROMNEY: Government doesn't create jobs. It's the private sector that creates jobs.

ROMANS: So what's in this Romney plan?

(on camera): First, Romney wants to overhaul the tax code by cutting marginal tax rates 20 percent across the board. He argues people will have money in the pockets to buy things. In turns, more jobs will be created to meet the demands for those goods and services.

Romney also claims that regulations cost private business about $1.75 trillion a year, so he says he will repeal Obamacare and Dodd- Frank financial regulation, much of which is still yet to be implemented. He also plans to reform the regulatory system to make sure it balances the benefit to society with its cost to business.

Finally, by balancing the budget, Romney plans to inject confidence into the business environment. However, capping federal spending, it means hundreds of thousands fewer government jobs at the federal, state and local levels.

(voice-over): Supporters of Romney's plan say it will create 12 million jobs, conservatively, but no president accomplished it in a single term since the data was first collected in the 1940s.

Now for President Obama's plans to get more Americans back to work.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Jobs must be our number-one focus in 2010, and that's why I'm calling for a new jobs bill tonight.

ROMANS: Well, that jobs bill never panned out and neither did the $477 billion effort he promoted last year, both essentially blocked by Congress. So, what does Mr. Obama want to do moving forward? Similar to what he's proposed in the past.

OBAMA: We need to create more jobs faster. We need to fill the hole left by this recession faster. We need to come out of this crisis stronger.

ROMANS (on camera): He wants to create jobs in manufacturing and green energy through tax incentives and investment, more spending on infrastructure. The president signed a more than $100 billion transportation bill in July, extends mostly current programs through 2014. And the president also proposed spending $35 billion for school, police and fire department payrolls, along with another $130 billion to shore up state budgets.

This was in his failed jobs plan last year. Yet to be seen, if he's reelected, whether those plans would have more success than they have had in the last three years.

(voice-over): Both candidates say they want to cut the corporate tax rate, expand energy jobs in the U.S. and support small business. Whoever's elected will probably have to do all that and much more to get us out of the jobs hole.

Christine Romans, CNN, New York.

(END VIDEOTAPE)

BLITZER: Certainly issue number one in this campaign, the economy and jobs.

KATE BOLDUAN, CNN CORRESPONDENT: And will be a huge issue in the upcoming debates that we're going to be watching very, very closely.

Also coming up, bear-hugging the president, actually lifting him off his feet. What was this guy thinking? He tells us next. Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Kate's here with a quick look at some of the stories trending right now.

Kate, what is trending?

BOLDUAN: Not only your glasses, Wolf. There are other things trending in THE SITUATION ROOM right now, including Hollywood's buzzing about the possibility of Oscar-winning actor Al Pacino headlining a new movie about the late Penn State coach Joe Paterno.

CNN confirms Pacino will play the coach. But reportedly there's still no script and no director and no final deal on the making of the film. And much more on that to come.

Also, the Taliban are threatening to kidnap or kill Britain's Prince Harry. He's just started a four-month deployment in Afghanistan as a co-pilot and gunner in a squadron of Apache helicopters. A source with Britain's Defense Ministry tells CNN they have thoroughly assessed the threat.

And Toys "R" Us is introducing a tablet just for kids. It's padded. It has a seven-inch screen and comes pre-loaded with 50 child-friendly apps and access to thousands more with a wi-fi connection. It will cost $150, a lot cheaper than other iPads and goes on October. oh, of course, just in time for the holidays. And the Florida pizza shop owner whose bear hug literally lifted President Obama off the ground this weekend says the moment wasn't Paul pre-planned or cleared in advance with Secret Service.

Wolf talked to him just a little bit ago.

(BEGIN VIDEO CLIP)

SCOTT VAN DUZER, BUSINESS OWNER: I guess I got caught up in the moment.

He -- I had a brief moment when I knew he was coming. He opened up the door and he was like, where's Scott at? And as soon as I saw him, he came right at me, shook my hand. And I was just so excited. I just gave him a big hug and picked him up. It was crazy.

(END VIDEO CLIP)

BLITZER: Nice guy, Scott.

BOLDUAN: Seems so nice.

BLITZER: I enjoyed speaking with him.

He obvious was so excited. The president comes into his pizza restaurant, pizza and pasta, I should say. And all of a sudden he gets emotional, picks up the president.

BOLDUAN: He said he was caught in the moment. Good thing that there wasn't a scene afterwards, the Secret Service going after him. But obviously it was all in good fun.

BLITZER: Fortunately, he didn't fall, nobody was hurt. There it is. Let's show it. There they are. Watch this.

BOLDUAN: has that ever happened to you?

BLITZER: No, no. I'm sure it's never happened to a president either.

BOLDUAN: I think you're absolutely right. Quite a video, something to remember.

BLITZER: We will be talking about that picture for a while.

BOLDUAN: For a long while.

BLITZER: A fund-raising first for the Obama campaign, at least in a few months. We're crunching the numbers.

Plus, more on the president's new lead in the polls. That's next. Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Happening now: significant changes in polls and fund- raising. Is this a turning point in the race for the White House?

Also, new details of a behind-the-scenes battle between President Obama and House Speaker John Boehner.

And a New Jersey mayor arrested by the FBI, now possibly facing decades in prison.

I'm Wolf Blitzer. You are in THE SITUATION ROOM.

A clear convention bounce for President Obama following the Democratic gathering in Charlotte. Take a look at this, our brand-new CNN/ORC poll. You can see the president now six points ahead of Mitt Romney. They were tied before the Democratic Convention.

BOLDUAN: And there's now a one-point Obama lead on the critical question of who would better handle the economy, erasing Mitt Romney's six-point lead following his convention in Tampa.

BLITZER: Let's talk about all of this with two guests, Republican Congressman Jason Chaffetz of Utah. He's a key Romney supporter. And Jen Psaki, traveling press secretary for the Obama campaign.

Congressman, it's a nice little bounce for the president of the United States. Neil Newhouse, though, the Romney pollster, he put out a memo saying this, among other things.

He said: "Don't get too worked up about the latest polling. While some voters will feel a bit of a sugar high from the conventions, the basic structure of the race has not changed significantly."

But I assume these numbers are not encouraging right now. You got to do some work. So, what's the strategy?

REP. JASON CHAFFETZ (R), UTAH: Well, the strategy is to continue to talk about jobs and the economy, because, yes, they did get a little bit of a sugar high.

And you get a number of days with unfettered access to the media and the American people. But when you go mano a mano, when you go head to head, and you start actually talk about jobs, the economy and the president's record or lack of a record, then I think the focus then becomes who's the best to lead us forward and put America back to work?

And, clearly, I think that will be Mitt Romney and Paul Ryan.

BLITZER: Why didn't Romney get a sugar high after the Republican Convention?

CHAFFETZ: He got a little bit, but immediately it rolled right into the Democratic Convention.

So, no excuses. When you get to October 3, and then you actually start to have debates and talk about these issues, when the president actually has to come out and talk about where he's going to be on this teachers union issue and answer difficult questions from the media, then I think you will start to see Mitt Romney doing quite well.

BOLDUAN: And, Jen, one issue that was made a very big deal by the Obama campaign, they really criticized Mitt Romney for not mentioning Afghanistan during his acceptance speech in Tampa.

Listen first here to what Mitt Romney said just today.

(BEGIN VIDEO CLIP)

ROMNEY: I was surprised in the president's speech at the Democrat Convention, he didn't mention unemployment.

(LAUGHTER)

ROMNEY: He didn't -- he didn't mention 47 million people on food stamps.

By the way, and that's a record number, and not a good record. When he took office, there were 32 million people on food stamps, now 47 million, one out of six Americans living in poverty. These are not numbers or people he spoke about during his convention speech.

(END VIDEO CLIP)

BOLDUAN: Now, he's making a strong point there.

I mean, we look back at the 2008 exit polls, and it shows that people making less than $50,000, less than $15,000 overwhelmingly supported and voted for President Obama. So, is the president taking this group of voters for granted this time around?

PSAKI: You know, I spend every day out on the campaign trail with the president.

And every speech he gives is about standing up for people who need help the most, helping people get a job who need a job, helping people send their kids to college, helping people have access to affordable health care.

So this is a little game of silliness on the Romney campaign team side. This is the thrust of his campaign, and the thrust of his argument and the choice he's laying out for the American people.

One other interesting number in the poll that you didn't touch on the CNN poll today was that the American people feel there are more specifics in his plan. They feel they're more optimistic about the vision for the future, and we definitely felt that when we were out on the trail in Florida this weekend.

BLITZER: Let the Congressman respond today. Silliness, she says, that what the governor is saying there. Go ahead.

CHAFFETZ: No. That's -- the key to this campaign is are jobs a ten economy and the reality is there are 23 million American who either don't have a job or are looking for a job.

Unemployment's been north of 8 percent. We took a deficit -- or a debt nearly $10 trillion to $16 trillion. We're paying more than $600 million a day in interest on that debt.

The president presents his budget to the United States Congress. Not a single person in the House or Senate, Democrat or Republican, voted for the president's budget, and he says he wants to move forward? How bad is your plan when Nancy Pelosi won't even vote for it?

BLITZER: Go ahead, Jen.

PSAKI: I have to say, you know, on last Friday, the Romney campaign keeps saying they want it to be about the economy. They said that on Friday. This weekend, when he was given the opportunity to explain how he would pay for his $5 trillion tax cut package for millionaires and billionaires, neither he nor his running mate could do that. They didn't explain what they would do for the middle class.

Instead, he stood with Pat Robertson behind him, and announced he was for keeping "In God We Trust" on the coins. So what are they presenting for the economy and the middle class? And I can't name three things.

CHAFFETZ: Well, approve the Keystone Pipeline. Put thousands of Americans to work right away. Tax reform, which we desperately need in this -- in this country. Repeal Obama care. Give every state a waiver. And if you're making an adjusted gross income of $250,000 or less, make sure that there are no taxes for capital gains, interest or dividend income. This would have an immediate impact on the middle class America right away.

So there are a lot of specifics to the Romney plan. We just need to explain them.

BOLDUAN: Well, let's talk about that, those specifics. And listen to this from Mitt Romney in an interview that he did with "Meet the Press" over the weekend. Listen to this.

(BEGIN VIDEO CLIP)

DAVID GERGEN, HOST, NBC'S "MEET THE PRESS": Give me an example of a loophole that you will close.

MITT ROMNEY (R), PRESIDENTIAL CANDIDATE: Well, I can tell you that people at the high end, high-income taxpayers, are going to have fewer deductions and exemptions. Those numbers are going to come down.

(END VIDEO CLIP)

BOLDUAN: You're a Romney surrogate. You're also a member of Congress that would really be looking at these issues, so let's talk specifics. What specific tax loopholes are the Romney campaign looking to close? CHAFFETZ: What we have said consistently is we want to broaden the base and lower the rate, and there are hundreds of exemptions out there that should no longer probably be there. Racetrack owners. Rum manufacturers. You keep going down the list. There are a whole host of them out there that really probably should be...

BLITZER: What about mortgage deductions?

CHAFFETZ: Well, it's something that's going to have to be discussed. But I don't think that is the heart of what they want to do. There are certain places that I think charitable deductions, home mortgage, those things probably are fairly untouchable at this point. But that's what the Congress is for.

You've got to have a president who engages with the Congress, works with the Ways and Means Committee. Thus far, the president in four years has been totally unable to do that.

BLITZER: I mean, as far as you're concerned, those home mortgage deductions and charitable contributions, that's off the table, as far as the president is concerned?

PSAKI: Right. You know, I just have to say, you can't pay for this with eliminating racetrack -- deductions for racetrack owners. The problem is the math and the arithmetic just do not add up. Because you can't lower the tax rate for everybody without impacting the middle class, without eliminating those deductions you just mentioned.

CHAFFETZ: Here's the fundamental difference. House Republicans at least have introduced a budget that passed the House. The Senate has gone more than 1,200 days...

BLITZER: You didn't spell out what deductions and loopholes you would put out. That's for the Ways and Means Committee. Paul Ryan is the chairman of the budget committee. He always says, "That's for the Ways and Means Committee. I'm not going to get into it."

CHAFFETZ: That's the way the process works. And what we did do is introduce...

BLITZER: Like all those big tax deductions and exemptions for G.E. or ExxonMobil, would you get rid of those?

CHAFFETZ: Well, there are a lot of tax credits that go out the door for the so-called green energy that are fundamentally absolutely not working.

And what America can't continue to do to is just have this bailout mentality that we're going to go bail out the whole rest of the country, because we have to actually pay the bills at the end of the day.

The president has totally failed to do this. You can't just keep spending money we don't have.

BOLDUAN: Do you think a lack of specifics is hurting the Romney campaign?

CHAFFETZ: No, absolutely. I would argue there are more specifics in the Romney plan than there are in the Obama plan. You have a budget that President Obama -- four years he's been the president. Not a single Democrat has ever voted to support the president. So he says he has his plan. Where is it?

BLITZER: Fair point, Jen. Why has none of the president's budgets actually passed? Hasn't even gotten any Democratic support sometimes.

PSAKI: Well, look, sometimes there's some games that go on in Washington, but the president has laid out a $4 trillion tax plan that would reduce the debt responsibly with a balanced approach from both sides. He has been willing to put forward cuts that Democrats don't like to some entitlement programs, but we also need Republicans to come to the table and put revenue on the table. And until they do, it's going to be a really rough discussion.

CHAFFETZ: This is the fundamental difference. They want to raise taxes. Mitt Romney said, "We're not going to raise taxes."

BLITZER: But you want to raise taxes by eliminating loopholes and deductions, as well.

CHAFFETZ: We are not one good tax increase away from prosperity in this country. To hear the president and the Democrats say it, we just need to raise taxes and everything will be fine.

We are spending more than 24 cents out of every dollar spent this country has spent by the federal government. What Mitt Romney and Paul Ryan have said, we have to drive that down to historical norms between 18 and 20 percent. That's where this country has got to be responsible.

PSAKI: There's no economist who will tell you that maintaining tax cuts for the highest income will help stimulate the economy, create jobs, move the ball forward. You know, we don't -- money doesn't grow on trees, as we all know. We have to make some tough choices. That's what the president wants to do.

CHAFFETZ: But the president has never introduced the budget that ever balances. Paul Ryan, at least while he was in the House, introduced a budget that over time does balance and pays off the debt. That's scored by the Congressional Budget Office. This is a very, very reliable...

PSAKI: Over the very long course of time, involves slashing programs. Domestic programs.

CHAFFETZ: You say a balanced program. The president has never introduced anything that comes close to balance.

BLITZER: You're saying that Paul Ryan has introduced legislation that would eliminate that $16 trillion national debt?

CHAFFETZ: Over the course of time, when you extrapolate it...

BLITZER: Over what? How long? How long would it take under the Paul Ryan budget to eliminate $16 trillion in our national debt?

CHAFFETZ: Well, you start to do that over a 75-year period. Well, you get some...

BLITZER: Seventy-five years?

CHAFFETZ: Well, you get to balance in the 2020 something. I have to go back and look at the actual date, but it actually balances. And it's not just what Paul Ryan was saying. It's not what House Budget Committee was saying, which I'm on the budget committee. It's scored by the Congressional Budget Office. The president has never come close to doing that.

BLITZER: Looking forward to the debates. What do you think?

BOLDUAN: If this is an example, I'm very much looking forward to the debates.

BLITZER: Look forward to it, October 3. That first presidential debate, three presidential debates. Is he practicing already, the president?

PSAKI: You know, I'll say Mitt Romney has a bit more practice than the president and he's done a lot of them recently. So...

BLITZER: Are you nervous?

PSAKI: Well, he's a much better debater. So we are nervous.

BLITZER: Who's a much better debater?

PSAKI: Mitt Romney has been...

BLITZER: You think?

PSAKI: Mitt Romney's been doing debates. He's done how many, a dozen over the last year.

CHAFFETZ: That's a good quality of the president. He's a better debater.

BLITZER: I moderated four presidential debates with the president when he was a candidate four years ago. Four presidential debates with Romney. They're both very, very good debaters. I would say that.

PSAKI: Should be interesting. Looking forward to it.

BLITZER: Don't sell the president of the United States short. He's a very good debater.

PSAKI: Don't tell him I said so.

BLITZER: I won't tell him. Thanks very much.

A potential election spoiler. But for which candidate? We're taking a closer look at how the Libertarian candidate for president is doing in the polls. Which major party might be paying a price? Stay with us.

(CROSSTALK)

PSAKI: You know, what he said is actually true. He has trouble having...

(COMMERCIAL BREAK)

BLITZER: All right. Time for some other political headlines making news right now. When's going on, Kate?

BOLDUAN: Yes, a lot's going on. First, let me take you to Trenton, New Jersey. The mayor of Trenton, New Jersey, is now free on $150,000 bail. Tony Mack appeared in federal courts this afternoon hours after being arrested for allegedly taking more than $100,000 in bribes from a developer seeking to build on city property. The arrest followed a two-year undercover operation by the FBI.

Also, bipartisanship, it's almost a dirty word around here, but it is still alive, at least in some places. Two Republican senators are endorsing a Democratic congressman, California Congressman Howard Berman. Redistricting has him running against a fellow Democrat, that's Brad Sherman, to represent the San Fernando Valley. Republican senators John McCain and Lindsey Graham are both now backing Berman, along with independent Senator Joe Lieberman.

And he is a very long shot for the White House, but Libertarian presidential candidate Gary Johnson could have an outsized impact on the race. The former New Mexico governor draws 3 percent support among likely voters in our new CNN/ORC poll, just ahead of Green Party candidate Bill Stein.

Their inclusion cost President Obama just one point but cost Mitt Romney three points, and that could tip the balance in an extremely close election.

Johnson was kind of pushing for support from former Ron Paul supporters. I don't think he's going to make the window.

BLITZER: In New Mexico, you know, his home state, he could make a difference.

BOLDUAN: He could make a difference. We'll see.

BLITZER: Erin's going to be speaking to him live in the next hour, so we look forward to hearing what Gary Johnson has to say. Thanks very much.

President Obama and the House speaker, John Boehner, talk about the debt showdown that took the United States to the brink of default. You're going to hear what they told our own Jessica Yellin about the drama that went on behind the scenes.

(COMMERCIAL BREAK)

BLITZER: As I mentioned, Erin Burnett is getting ready to interview Gary Johnson live in the next hour. He's the Libertarian candidate for president of the United States.

Erin, he could play a significant role if it's really, really close in certain states. He could maybe swing some of those votes.

ERIN BURNETT, CNN ANCHOR: That's true. And you know, when you look at, Wolf, these swing states and how crucial they are, Gary Johnson could really just take a few percent here or there; change the course of this entire election. It's a pretty powerful position to be in.

And we're going to talk to him about that and, well, why he made the decision to do it and which candidate he thinks he may affect the most. Because it's interesting, as you say, Wolf, in some states, the Obama campaign is more afraid of him and in other states, the Romney campaign is more afraid of him. So we're going to be joined by Gary Johnson.

Also going to be joined by former congressman, Patrick Kennedy, who's going to talk about a man that has become a very close friend of his over the past 15 years, Congressman Jesse Jackson Jr., who is back in Washington. And, you know what, Wolf? He's got -- they had a very serious conversation about stepping aside.

Congressman Kennedy had said, you know what? It was the best decision of his life to step aside, given all of the issues that he has had, the challenges that he has had with mental illness and addiction. And he's going to talk about his advice to Congressman Jackson as he faces some very big decisions.

All that coming up top of the hour. Back to you.

BLITZER: Looking forward to it, Erin. Thanks very much.

The behind-the-scenes drama of last year's debt showdown is being revealed in a new book by the award-winning journalist Bob Woodward, and it's an important new book, too.

BOLDUAN: It's an important new book. And it details the collapse of the so-called grand bargain between the White House, the Oval Office and the Republican-led House, which put the U.S. on the brink of default. We remember so well.

BLITZER: Certainly. We've got more problems down the road. Our chief White House correspondent, Jessica Yellin, spoke about it with both the president and the House speaker, John Boehner. Jessica's here with more.

It's a dramatic story, indeed. And you got the inside story on that. JESSICA YELLIN, CNN CORRESPONDENT: Well, I talked to both the men and sort of who you blame for this one really depends on where you sit. Speaker Boehner says the president blew up the deal by changing the terms at the last minute, but the president, he says the speaker is mischaracterizing what happened.

(BEGIN VIDEOTAPE)

REP. JOHN BOEHNER (R-OH), SPEAKER OF THE HOUSE: It was going to be tough for both of us. I'll be the first one to admit, but I -- I was willing to go down this path with him, because it was the right thing to do for the country.

YELLIN: They say they never changed the terms of the deal. So, are you saying they're lying?

BOEHNER: They changed the terms of the deal. The president either lost his courage or lost his judgment and wanted $400 billion more in higher taxes.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I think personally, Speaker Boehner wanted to do something. He just couldn't control his caucus. I think that some of the Tea Party language and sort of elements that had come to dominate the Republican priorities and Republican politics made it very tough for him to sell any deal with me.

YELLIN: Given your history together, why should the American people have faith that you and Speaker Boehner can work together in the future?

OBAMA: My hope is that, after this election, if I'm elected to a second term, then the priority that some Republicans in Congress have placed on beating me will recede, since I'll no longer be up for re- election, and the priority of getting things done for the country will be at the forefront. And in that environment, I think we can get things done.

But look, there are very real differences between Democrats and Republicans right now on how to solve some of these problems.

(END VIDEO CLIP)

YELLIN: Now, the facts, I'm told by both Democrats and Republicans, that just before the grand bargain blew up, the White House did ask for an additional $400 billion in revenue.

The Democrats say White House negotiators told Speaker Boehner if he cannot do it, he should let them know. That's why they say they weren't changing the terms of the deal. They were asking for that, and the next they heard he'd pulled out of the deal.

And Speaker Boehner's office says, bah, that's just not how it happened. It's really a he-said/she-said for the ages.

BOLDUAN: But kind of a fascinating parlor game, because everyone really wanted to get inside and find out who blew up the deal and how it all went down.

Part of the discussion throughout has been that these two men didn't know each other very well when they were taking on this negotiation. How much have they been in contact since then?

YELLIN: So they have had a phone call around Christmas time. They've had these bipartisan meetings when leaders of both houses have gotten together. But not -- no direct conversations really seriously beyond that.

And I did ask Speaker Boehner -- they have this fiscal cliff to negotiate. I said, "Are you going to call the president?"

And he said, "Well, he's the president."

I said, "So what does that mean?"

He says, "We'll work it out."

BOLDUAN: It sounds like not much has changed.

BLITZER: Yes. And by the way, Wednesday, I'm going to be sitting down with Bob Woodward. He's got this new book, and he just goes through all this stuff. We've got some new details from this new book. The interview will air Wednesday night on "PIERS MORGAN TONIGHT." Filling in for Piers on Wednesday. You'll see it.

BOLDUAN: Great. I'll watch.

BLITZER: Thank you.

Just in time for Halloween, a new candy corn version of the Oreo. Some say it's yummy. Others say not so much. Our Jeanne Moos will put it to the test.

(COMMERCIAL BREAK)

BLITZER: So, bats in the belfry are one thing, but bats in a TV news room? That seems to be chaos. Look at this video. A bat had been hiding in the building housing CNN affiliate KATV in Omaha, Nebraska. And it had been hiding there for weeks. It finally spent an hour, as you can see right here, swooping through the news room Saturday. And eventually, the Humane Society was called, and they eventually, after as you can see, much chaos, caught the bat. It's now in protective custody, and the news room is quiet once again, at least. As quiet as a news room gets.

BLITZER: Let's hope a bat doesn't fly into our new SITUATION ROOM studio.

(CROSSTALK)

BOLDUAN: No, there are no animals.

BLITZER: How do you like our new studio?

BOLDUAN: If I had to use a word, snazzy.

BLITZER: Very nice.

BOLDUAN: Very nice.

BLITZER: I tweeted, "The president is jealous of our SITUATION ROOM. He's telling his folks over at the White House in the West Wing they need a new situation room over there. Our SITUATION ROOM is better than his.

BOLDUAN: I mean, I'm going tell him that, actually.

BLITZER: Thank you.

The makers of the all-American cookie, the Oreo, are giving it the flavor of candy corn to create a special Halloween treat. We're not making this up. But candy critics wonder what are they thinking?

CNN's Jeanne Moos puts the taste to the test.

(BEGIN VIDEOTAPE)

JEANNE MOOS, CNN CORRESPONDENT (voice-over): What do you get when you combine America's most famous cookie with its most loved and hated candy? You get what Gizmoto calls the "mutant love child of deliciousness." The limited edition candy corn Oreo. About a third of the folks who tested without telling were able to place the taste.

UNIDENTIFIED MALE: Yes, I got it. The corn. The candy corn.

UNIDENTIFIED MALE: I'll give them props for matching the flavor, but I don't like candy corn.

UNIDENTIFIED FEMALE: Once a year, love it for about three handfuls. Then I'm done.

MOOS: Just in time for Halloween, Nabisco is selling the Candy Corn Oreo at Target stores. Naturally, candy corn has been a target for haters.

LEWIS BLACK, COMEDIAN: All of the candy corn that was ever made was made in 1911.

MOOS: Lewis Black calls it the worst thing about Halloween, but when we gave the cookie to Fiona...

UNIDENTIFIED FEMALE: It's about all of the candy that I had for Halloween.

MOOS (on camera): Like this?

UNIDENTIFIED FEMALE: Yes, I love those.

MOOS (voice-over): Odd flavors of Oreos are nothing new. Nabisco makes blueberry ice cream Oreos for Indonesia and green tea Oreos for China. And they've gotten edgy with their advertising, giving the Oreo's image a makeover for gay pride and to honor the latest Mars rover, but an actual candy corn Oreo has the Internet champing at the bit to review it.

UNIDENTIFIED FEMALE: Chug it (ph)?

Can I have it? That's a no.

MOOS: One reviewer thought the cookie's taste is so identical to candy corn that if you can't get your hands on the new Oreos, he recommends sticking actual candy corn between the halves of a regular Oreo.

Still, some refuse to try it.

UNIDENTIFIED MALE: I'm in a 12-step program for Oreos.

MOOS: Ahh, childhood memories. Using candy corn for Halloween fangs. Some people only have eyes for Oreos, even in the most unlikely places.

UNIDENTIFIED MALE: HI, this is Rob. I'm in the bathtub. You want to see my package?

MOOS: That's candy corny.

Jeanne Moos, CNN...

UNIDENTIFIED MALE: Hee-hee.

MOOS: ... New York.

(END VIDEOTAPE)

BLITZER: I think they're probably delicious.

BOLDUAN: I think they're probably delicious.

BLITZER: I might...

BOLDUAN: Can I turn this conversation to something we've been wanting to talk about all day?

BLITZER: Yes, OK.

BOLDUAN: This new eye wear.

BLITZER: Yes.

BOLDUAN: Is it because of the new studio you had to have new eyewear?

BLITZER: Anderson Cooper, he's got these similar kind of glasses. You see Anderson Cooper?

BOLDUAN: I've met him. BLITZER: A few years ago, he was deciding whether to wear the glasses or take them off. I saw it. If you go online, check out Anderson Cooper. You know, he's got the silver. He's the silver fox.

BOLDUAN: And you're the Wolf fox.

BLITZER: We have a new studio. And I said you know, I need new glasses. I went and got some glasses.

BOLDUAN: And what is...

BLITZER: Some people like them. Some people don't like them.

BOLDUAN: We love them, and in honor of Wolf's new glasses, we couldn't let you have all the fun.

BLITZER: Wow.

BOLDUAN: Producer Von Sterling let me wear his.

BLITZER: Wow.

BOLDUAN: So now, I'm officially Wolf.

BLITZER: Yes. Look how studious you look.

BOLDUAN: Camera one, camera two.

BLITZER: We'll give the viewers a sense.

Now you can follow us on Twitter: @WolfBlitzer and @KateBolduan. "ERIN BURNETT" -- I'm looking at the camera -- "OUTFRONT" starts right now.