Candidates Prepare For Presidential Debate
WOLF BLITZER, CNN ANCHOR: To our viewers, you're in THE SITUATION ROOM. Happening now, the breaking news we are following -- the president and the Democrats hope to reach a deal soon on that $700 billion financial bailout, but some from the president's own party are against what he is trying to do. The presidential debate, as you know, is on, but only after John McCain changed his mind again. With all the drama, what do McCain and Obama need to do now? And what will they need to do down the road? We are going to preview the substance, their styles and the great expectations as the debate suspense builds, all that plus the best political team on television. I'm Wolf Blitzer at the CNN Election Center. You are in THE SITUATION ROOM. We are only three hours away from a dramatic point in this presidential race. Barack Obama and John McCain will hold their first debate. And as they get ready to face off in Oxford, Mississippi, Congress and the White House continuing their desperate effort, indeed their desperate debate, over that $700 billion Wall Street bailout. We are following the breaking news that one high-ranking Democrat calls a revolt by House Republicans against the president's wishes. Congressional Democrats say President Bush needs to get House Republicans on board if there is any chance of passing it. Democrats and the president are hopeful a deal will be reached very soon. Ed Henry is standing over at the White House. But let's go to Jessica Yellin first. She is up on Capitol Hill watching all the latest developments. What is the latest. What do we know about the prospects right now, Jessica, of a deal?</s>JESSICA YELLIN, CNN CONGRESSIONAL CORRESPONDENT: Wolf, right now, negotiations are taking place at the staff level. And I have just gotten word that those staffers are taking a dinner break. Some of them have been at work on this project since 5:00 this morning. We understand they will come back and continue to hammer out what will be a draft proposal in theory. And once they have worked through an entire draft, it's our understanding that is when they would have a meeting of the principals in this negotiation, two Democrats, two Republicans, with Secretary Paulson to hammer out the final details. Now, we have heard a lot of sniping in the past day over who is to blame for the breakdown, Democrats today expressing some real frustration that they feel this process was politicized when the presidential candidates came to town. This was Nancy Pelosi earlier.</s>REP. NANCY PELOSI (D-CA), SPEAKER OF THE HOUSE: I would not include yesterday among the days where we made progress, because there was an intervening -- an intervening event that set us back, took time. And now we're back on track.</s>YELLIN: Now, House Republicans, of course, saying that they had reservations all along, and they are glad that their considerations are now in part of the negotiating process. Of course, the overall message we're getting from members on both sides is that they do want to get something done, that progress is being made. One person described it to me as plodding, but still moving forward and they are looking still at a Monday date. That is their goal date to have something done, but we will see if that is realistic -- Wolf.</s>BLITZER: We will see and we're watching every moment with you, Jessica. Thanks. Let's go over to the White House. Ed Henry is over there. Ed, with hindsight, that dramatic meeting that the president had, what, 26 hours ago with the Republican and Democratic leadership on the Hill, and the two Palestinians candidates, was it a mistake? Did it set back the negotiations?</s>ED HENRY, CNN WHITE HOUSE CORRESPONDENT: Wolf, Democrats certainly think so, but White House officials still believe that the president bringing the two presidential nominees to the table was a dramatic move to at least sort of focus everyone's attention in Washington and around the country about the urgent need to sort of move forward do something, but can it actually get done? That is the big question here at the White House this hour. I can tell you that just in the last few moments, the president wrapped up a meeting with British Prime Minister Gordon Brown. At the end of that meeting, the president said he is still hopeful that he can get a deal through Congress. He also said that he thinks that the price tag, $700 billion, is big enough to make an impact here and around the world. That is something that the British prime minister expressed support for, obviously a lot of fears in Europe that this could spread over there even more. Secondly, the president earlier today took a call from the French president, Nicolas Sarkozy, who also expressed his support in that phone call we're told for the actions here in the U.S., hopeful there in France as well that there will be some action in the U.S. Congress. Again, there is fear in Europe that this problem, the crisis in the United States, could be spreading overseas. And finally I can tell you that the Treasury Secretary Henry Paulson not only has been reaching out to various members, but has been on the phone with Senate Majority Leader Harry Reid throughout the day today trying to get reports. Administration officials say, bottom line, they are getting word from the Hill about what they say is constructive talks, but still nowhere close to a deal -- Wolf.</s>BLITZER: All right, thanks very much, Ed. Stand by over at the White House. Let's go up to Capitol Hill once again. Chris Dodd, the Democrat from Connecticut, the chairman of the Senate Banking Committee, and one of the negotiators, one of the inside players in all of this, is joining us right now. When do you realistically believe, Senator, that you will resolve all these matters and actual legislation will come up for a yea or nay vote on the Senate floor?</s>SEN. CHRISTOPHER DODD (D), CONNECTICUT: Well, I don't know the answer to your question, Wolf. I think it could come as early as the end of the weekend or maybe some time early next week. I am interested in getting this done quickly, but I won't be stampeded. Listen, this crowd got us into this mess. It didn't have to happen. You have heard me say that in the past. This was preventable and avoidable. This was not like Katrina or Hurricane Gustav. So, we are here in a moment of tragedy candidly and everyone is angry about it, they ought to be. The question is, what do we do about it? And I have made recommendations. We have had meetings yesterday, in fact all week since last Thursday, a week ago Thursday night. And I am prepared to be supportive of a plan, a rescue plan here, a workout plan, but it needs to have provisions on it dealing with executive compensation, dealing with taxpayer -- getting something back if profits are made on the sale of these assets. But I clearly want to see strong accountability provisions, as well as of course dealing with the issue of foreclosures...</s>BLITZER: Are you any closer with those House Republicans, who are saying, you know what, the basic concept that Henry Paulson, the treasury secretary, came up with, that the Democrats accepted in the Senate and the House, with some major modifications, as you point out...</s>DODD: That is totally false.</s>BLITZER: What is totally false?</s>DODD: That we accepted the Henry Paulson plan.</s>BLITZER: No, no, no, but you accepted the core principle that there should be a bailout, there should be $700 billion as part of this package, that the U.S. government in effect should buy these so- called illiquid debts.</s>DODD: No, no, no. In fact, the other day, you may have recalled, if you paid attention -- I'm sure you did -- to the hearings, I raised specifically the question, are you considering other options, other than just buying these distressed assets? Because I want to know if you need additional statutory authority to do that, because many people have serious reservations about exactly what you want to do, not just here in Congress, but economists across the country. He assured me that he was considering other options. There's never been any question about whether or not...</s>BLITZER: Well, what do you think about the alternative proposal being put forward by these House Republicans?</s>DODD: Well, I don't know. I have been told by Henry Paulson it's a terrible idea. Now, other economists are rejecting that as a proposal, but I have no objection to economists considering that idea, along with a variety of others that ought to be out there on the table. That has never been a debate. The debate has been about whether or not you protect taxpayers, whether or not you protect against executive greed in compensation, whether or not you do something on foreclosures, and whether or not you're going to really do something here with accountability. This proposal that was sent to us a week ago had none of that in it. And we have been insisting upon those conditions. If they are not there, this plan will die. If they are there, there's a chance we will pass it.</s>BLITZER: And, so, basically, give us your bottom line, Senator. How close do you believe -- and no one is closer to the negotiations than you are -- how close do you think you are now to a package, to a proposal, legislation that can be voted on in the House and Senate?</s>DODD: Well, I am heartened by the fact that the House Republicans are finally sending a serious negotiator in Roy Blunt. We have tried for seven days to get them to pay attention to this. And of course they wouldn't. Now they are. That is good news. And I welcome it. So, I am optimistic that if we can sit down over this weekend, that we can get some result here that we can offer to our colleagues. But I have got to tell you, 38, 39 days before election, most people up here are angry that they have been put in this position, and they're not about to turn a $700 billion check -- or checkbook over to this president or his successor without some real conditionality associated with it.</s>BLITZER: Chris Dodd is chairman of the Banking Committee. Senator, thanks very much. Good luck.</s>DODD: Thank you, Wolf.</s>BLITZER: All right, let's bring back Jack. He's got "The Cafferty File." A lot of drama, but enormous stuff at stake right now.</s>JACK CAFFERTY, CNN ANCHOR: I like him.</s>BLITZER: Chris Dodd?</s>CAFFERTY: Got his stuff together.</s>BLITZER: Yes.</s>CAFFERTY: They have got to be tired. These guys have got to be getting worn slick. They are going almost around the clock with this stuff. Good job. Joe Biden, the vice presidential candidate, never at a loss for words. That is both the good news and the bad news. You see, not everything Biden says is helpful to the Democrats' cause. Here's an example: He told the "CBS Evening News" this week that, in 1929 -- quote -- "When the stock market crashed, Franklin D. Roosevelt got on the television and didn't just talk about the, you know, princes of greed. He said, 'Look, here's what happened'" -- unquote. Except that FDR wasn't in office in 1929, and there wasn't no television when the stock market crashed either. In that same interview, Biden called an Obama that attacked John McCain as being computer-illiterate terrible. Last week, Biden criticized the government bailout of AIG without checking with the Obama campaign first. And Barack Obama later had to say -- quote -- "I think Joe should have waited" -- unquote. There's more. Biden said paying higher taxes is the patriotic duty of the rich. And earlier this month, he told a crowd that Hillary Clinton may have been a better vice presidential pick than he was. Like we said, never at a loss for words. Here's the question: Is Joe Biden an asset or a liability for Barack Obama? Go to CNN.com/caffertyfile. You can post a comment on the blog. When is the vice presidential debate? Is it next week?</s>BLITZER: It's next Thursday.</s>CAFFERTY: Next Thursday. I can't wait.</s>BLITZER: Saint Louis, Missouri.</s>CAFFERTY: I can't wait. You think this thing is going to be interesting tonight? I can't wait until next Thursday in Saint Louis, Missouri.</s>BLITZER: I love all these debates, but you are right. That one will be pretty exciting, too.</s>CAFFERTY: Yes, it will.</s>BLITZER: All right, at last the two nominees getting ready to face off in a debate. We're counting down, two hours, 49 minutes to go. Now that it is back on, how is the Obama camp managing expectations? What he needs to do tonight? Also, did McCain's bailout strategy backfire? After his high- profile suspension of his campaign, there is still no rescue plan, so why is the debate back on? And President Bush suffers a power failure. In a stunning twist, he has backing from many Democrats, while lawmakers from his own party, many of them turning a deaf ear to his pleas. All of this coming up, plus the best political team on television. Stay with us. You're in THE SITUATION ROOM.