won't create jobs, won't reduce our deficit, but will make sure that folks at the very top don't have to play by the same rules you do. i have got a different vision for america. i want to build on our strengths. i put forward a plan to make sure that we're bringing manufacturing jobs back to our shores. by rewarding companies and small businesses that are investing here, not overseas. i want to make sure we have got the best education system in the world and we're retakening workers for the jobs of tomorrow and i want to develop oil and natural gas and the energy sources of the future. i want to reduce our deficit by cutting spending that we don't need and also asking the wealthy to do a little bit more so that we can invest in things like research and technology that are the key to a 21st century economy. as commander in chief, i will maintain the strongest military in the world, keep faith with our troops and go after those who would do us harm but after a

decade of war, i think we all recognize we have to do nation building here at home, rebuilding our roads, our bridges, and especially caring for our veterans who sacrificed so much for our freedom. we have been through tough times but we always bounce back because of our character. because we pull together, and if i have the privilege of being your president for another four years, i promise you i will always listen to your voices. i will fight for your families. i will work every single day to make sure that america continues to be the greatest nation on earth. thank you. >> governor. >> thank you. bob, mr. president, folks at lynn university, good to be with you. i am optimistic about the future. i am excited about our prospects as a nation. i want to see peace. i want to see growing peace in this country. it is our objective. we have an opportunity to have real leadership. america is going to have that kind of leadership and continue to promote principles of peace that will make the world a safer place and make people in this

country more confident that their future is secure. i also want to make sure we get this economy going, and there are two very different paths the country can take. one is a path represented by the president which at the end of four years mean we would have $20 trillion in debt heading towards greece. i will get us on track to a balanced budget. the president's path will mean continuing declining in take-home pay. i want to make sure our take-home pay turns around and starts to grow. the president's path means 20 million people out of works struggling for a good job. i will get people back to work with 12 million new jobs. i am going to make sure we get people off of food stamps, not by cutting the program but by getting them good jobs. america is going to come back and for that to happen, we're going to have to have a president who can work across the aisle. i was in a state where my legislature was 87% democrat. i learned how to get along on the other side of the aisle. we have to do that in washington. washington is broken.

i know what it takes to get this country back, and we'll work with good democrats and good republicans to do that. this nation is the hope of the earth. we have been blessed by having a nation that is free and prosperous thanks to the contributions of the greatest generation. they have held a torch for the world to see, a torch of freedom and hope and opportunity. now it is our turn to take that torch. i am convinced we'll do it. we need strong leadership. i would like to be that leader with your support. i will work with you. i will lead you in an open and honest way. i ask for your vote. i would like to be the next president of the united states to support and help this great nation and to make sure we all together maintain america as the hope of the earth. thank you so much. >> gentlemen, thank you both so much. that brings an end to this year's debates and we want to thank lynn university and the students for having us. as always do at the end of these debates, i leave you with the words of my mom who said go

vote. it makes you feel big and strong. >> that's great. >> thank you. >> thank you. [ applause ] the final face off has come to a close, the president and governor romney ending their third and final debate about foreign policy. >> a little emotional that the debate season is over? it is sad, isn't it. >> fiery and a little more volatile towards the end. i felt like governor romney was playing it safe here and the president came out swinging. what do you think? >> do no harm may have been the debate strategy ahead of time given his momentum in the polls and nationwide and swing states. there were spirited moments with the president trying to school romney on modern warfare saying in addition to fewer subs and ships we have fewer horses and

bay nets in today's military but clearly i don't know what was more frustrating, the fact that the positions on foreign policy were not that different, not that far apart or the fact they didn't really want to talk foreign policy at all. >> they wanted to connect the dots to the economy and talk about their plans to get jobs moving again in this country. interesting commentary about russia. initially the president had the upper hand but then romney came back with the comment about putin and russia and that was an interesting part of the debate as well. >> they covered iran, pakistan, israel. let's go to boca raton and check in with john harwood. you told us romney would be playing defense tonight. you were right. >> yes, carl, both candidates did exactly what their advisers told me they were going to do. mitt romney tried to be presidential. i think he was. he showed that he had certainly absorbed a lot of the briefing material he had. he doesn't have direct foreign policy experience but looked assuring to the american people. he had a strong close there. he only went after president obama when provoked.

president obama on the other hand decided that he wanted to be aggressive as he was in the last debate. he went at mitt romney over and over on his positions on the auto bailout, on being all over the map as the president said, and on various issues and the question is going to be by being aggressive did he actually benefit himself? did he score points? you know, there was a -- when you contrast the demeanor of the two, barack obama looked more like the challenger who looked as if he was trying to make head way in the debate while mitt romney was saying this is going my way, i am just trying to avoid mistakes. it is possibly true that this debate isn't going to move the polls very much. the polls are pretty well locked in right now, but be interesting to watch the reactions over the next few days and see where whether either candidate finds their strategy vindicated. >> for sure. i agree. i think this is one of those debate that is doesn't necessarily resonate with the voter out there as they're focused on job creation.

seems these international correspondent on set. michelle, your thoughts. >> i think ultimately president obama came out on top, b he did not trounce romney. romney did as well as he needed to tonight. i think he needed to convince people he stood for peace and stability when he made the point about not wanting american soldiers to go into syria. i think that was a good point. ultimately, i think he stood his ground and did what he needed to do and make the point, marie a ultimately the topic tonight isn't the one that is driving the election. it is the economy and when romney spoke about the economy, he looked far more comfortable and stronger. >> even when the issue of libya and benghazi came up and the president's response to the american people about benghazi, romney did not jump in and try to attack that the way a lot of people thought he would, larry cutler. >> i think he made a mistake. i think team romney reverted back to sitting on a lead they may or may not have.

this group is interesting. there are two romneys. one is the romney biography, here i am, here is what i have done, i know how to balance a budget. the other romney is here are my policies, they're a lot different than your policies, i am a tax cutter, i am a free enterpriser, i am going to build up military. now, he said those things, but i don't think he said them in a way that really stuck. >> really? you wanted boots on the throat tonight? >> i wanted to see more aggressive mitt romney. >> the way the president was. >> i thought the president was more aggressive and had less to say which is an odd thing. just like his domestic policy, i don't think mr. obama has a vision for foreign policy at all. i think what these guys did was they counter punched each other to death literally. they're probably both left standing after 15 rounds. i don't think anybody got any place in this. i loved romney's end. i loved the summary. i think he was about an hour and a half too late. >> bring in our panel, sara fagen, a senior aid to george w. bush and jerry bernstein, former

chief economist to joe biden, and cnbc contributors and robert wolf, former chairman of the americas for ubf and billionaire heinz servant is with us. did the president look by being aggressive and not as much to say, did he look like he was flailing in any way and punching at anything that moved? >> he did look a little that way and even though he looked presidential and in command of his facts i think tone ally he was a little off tonight and at the same time i agree with larry. i didn't get from mitt romney what i wanted to as a republican. he did not sound like a hawk at all. you can be a hawk without promoting war. so i was disappointed in both tonight. >> it certainly was a strategy that he had. >> i thought the point was to not appear like a blood thirsty. >> that's fine. you can do that. >> i wanted romney to kick some butt. to be honest with you, i wanted him to kick some butt.

he didn't kick butt in the second debate. he did in the first. most of all, i said this and i think it was right. this is a guys, he was trying to get to economic policy, mitt, instead of foreign policy. i don't blame him. i don't think you do either. he said what he needed to say, but he didn't pound it home. he didn't talk hard about the tax cuts which he did. he did mention take-home pay. he didn't talk hard about the tax cuts. he didn't attack enough on the spending restraint and the entitlement reform and he gave too many openings to the president in my view. >> there is a balance to be walking. the president being as aggressive as he was tonight and using each opportunity as a smackdown for mitt romney, does that turn people off? >> well, i don't know if it turns people off or not. i think it makes him look a more authoritative on these issues and one of the reasons why mitt romney didn't pound back the way some of them wanted to is he just doesn't know as much about foreign policy. >> i am talking about the economy. >> to me, to he many, the tone

of the discussion tonight reminded me, i have a friend who knows a ton about sports. we talk about sports. i don't know that much about sports. i can carry my own. i sounded like mitt romney in these conversations. he just doesn't know as much. >> referencing mollie? >> he is well prepped. he doesn't have the on the ground experience. >> what do you think, robert? >> tonight's debate is who is the commander in chief? it was clear he came out as a commander in chief. whether we like it or not, the debates are a show. tonight was supposed to be ali, frazier iii and one guy showed up and one guy didn't. that's how it is. that's how the first debate was. >> i don't know if romney didn't show up. >> listen, he did not respond to the libya. he was not tough on iran like he was before hand. he was not -- >> president obama got trounced on debate one and romney did not get trounced tonight. >> it is very interesting to me. >> he had certain things. he was much more hawkish before tonight on iran and russia and china and don't he didn't.

>> why didn't he jump on the opportunities for benghazi? >> i am not sure. >> i think i know why he didn't. this was something that i believe his advisors said don't mix it up with ben gaz i the way you have been doing because it doesn't sound presidential. talk more about the thematics of the middle east as opposed to drilling down on this one incident. >> he should have talked about the security lapses. i understand the intelligence is moving and intelligence is murky. i get that part. >> don't politicize it. >> you said it, larry. >> i think the security issue was something he should have gotten into because the mistakes the administration made on security and benghazi were huge and by the way, this other story that's developing, a late breaking story, i talked about it with rumsfeld, there is no reason we didn't send military airplane from this italian base and could have been there in one hour on the jets and we could have had command owes on the

ground in three hours. >> to libya? >> yes. >> interesting the times -- >> i don't know why they hadn't talked about that. >> what is the answer? what do you think the answer is on this? why have we dropped the ball in libya? >> i don't think we have dropped the ball. i think the in was is still coming in. there was convincing information this week that in fact we don't even know if this was because of the video or a more planned protest. there is some information on the ground suggesting it was more a function of this video. >> what? what? >> i would love to get your take on what you heard tonight. >> i did something i really rarely do. i want to defend jared on this. >> thank you. >> the c.i.a. tables came out and did show not that it was one or the other. >> exactly. >> but that there might have been a mixture. i don't know about the c.i.a. i never know about the c.i.a. there is disagreements inside the intelligence. >> that's the whole point. >> i don't know why romney

didn't attack the lapse of security. security, security, security. >> one very nice panel member that is not here and at a different table. your thoughts about what you saw? >> well, i thought president obama was presidential. i thought governor romney failed the test. and the most inspiring thing is his love for teachers and the thing that he spared us is his love for big bird and frankly there was nothing inspiring at all in what governor romney had to say. i thought that president obama laid out his achievements in a very clear way. i thought that the only thing that governor romney was consistent about is his inconsistency and inaccuracy basically he was all bluster and swagger just like president bush during the whole campaign. now that he no longer needs to

cater to the extreme right of his party, he has gone completely to the same position as president obama. the one thing that really baffles me is he keeps repeating how he brought both sides of the aisle together when he was governor but what he doesn't mention is that he vetoed legislation that was in front of him, know this number, 844 vetoes as governor. if this is bringing both sides of the aisle together, and this is how he intends to govern, well, and if he becomes president of the united states, i think we're in deep trouble. 844 vetoes. >> right. >> now, just to finish up on what the president said, the president is dealing with 150 extremist islam terrorist

organization. nobody can solve that problem at a flip of a switch. maybe governor romney with his love for teachers and big bird can address this but no one can solve this problem. with that said, the president has kept america safe. >> haim, want to get back to boca and bring in our next guest who is governor pat quinn, illinois home base to some of america's biggest candidates actually, ad corporations, mcdonald's, boeing, deer, united, continental joining us now, democratic governor pat quinn that joins us from i which. thanks for being with us. >> glad to be here. i think you have mentioned all the company that is have done well exporting to the world under president obama and also i think president obama showed an encyclopediaic command of foreign policy and he is the commander in chief and notice how he mentioned the veterans from the get-go. he understands if you're commander in chief you have to stand with those on the front line for our democracy. >> he absolutely did. >> and when they come home, take

good care of them. >> governor, what do you make of the notion that perhaps the president looked more like a challenger tonight and he had to be aggressive because his back was against the wall. >> when somebody attacks you, you have to respond and be there with the facts and i think president obama over and over again showed governor romney what the facts are. i really don't think governor romney is in the same league when it comes to foreign policy. our country is much better today an that four years ago when it comes to foreign policy. we have a respect of nations all across the world. we have used that respect to build sanctions against iran and get out of iraq and move forward in the world, and i think that's what we're looking for in a president. >> do you think, governor, the candidates made the connection to the economy in terms of why these foreign policy decisions are so critical to actually coming back to the issue at hand for voters and that is job creation? >> i think it is very important, the president pointed out, we wanted the american auto

industry and if it was up to romney we wouldn't have to and having to do deal with china when it comes to automobiles. we have had a resurgence in illinois and all across the midwest in the auto industry and thousands more jobs and people working and all the subcontractors and suppliers working, and that's a clear way to strengthen america and have a strong economy to deal with the world challenges we have. we're exporting from illinois from the midwest from america and not only our agriculture but manufacturing goods all across the world. >> trouble is with all due respect, the economy is growing 1.5%. >> maybe 2. >> the last score was 1.3, 1.5. >> i will give you 2. >> i am not sure i want it. >> two ranks as the lowest recovery in gdp and jobs since 1947. that's one point. what romney did, i will defend him on this, he made the case that the weak economy is damaging our military posture

which is damaging our foreign national security abroad. a, b, it is a reagan argument in effect. my problem with romney tonight is i don't think he hit it home. i don't think he punched it out the way he did in the very first debate. >> was that intentional? he wants to look presidential and not look like the attacker? >> i think his aides decided he was going to play it safe. i think there is a little too much val you mean in the romney presentations, and i would rather see some -- really, i would have rather seen a caffeinated starbucks. >> one last question from the governor before we let the governor go. >> we have been there. >> governor, you understand the up state/down state dynamic in illinois, romney strong in the south generally, obama strong in the urban centers and chicago up north. did any of that change tonight even on the margin? >> i think when you talk about veterans, they come from every part of our country, suburban, rural, and city, and i think the

president understands if you're commander in chief, you take care of those fighting for our democracy and i think we shouldn't under estimate both the first lady and the president's commitment to our troops. they understand when you are commander in chief and you order people into battle and you have to protect them, not only in battle but when we come home, and that's important issue for all of americans, and the president is an outstanding record at fighting for the men and women that wear the uniform of our country. >> and he communicated that tonight, governor. good to have you on the problem. thank you so much. we appreciate your time. let's get back to boca and john harwood and a special guest. john, over to you. >> i want to make one point before i go to our special guest, that is the tone you were talking about from mitt romney at laying back and haimsaban said he moved towards president obama. that was largery because the key voters, the swing voters at the end of the campaign were women so he was trying to very much

distance himself from the bush foreign policy and portray himself as a peace maker for the benefit not of larry kudlow but female voters in ohio, virginia, florida, colorado, but i am joined by boe biden, the attorney general of delaware, son of vice president joe biden. let me ask you about what we discussed earlier in the program. president obama was much more aggressive, but did he also strike a presidential tone in the sense, was he trying too hard to go after romney where romney was trying to be as statesmen like as possible? >> the president of the strong, decisive, steady, and the same way in the debate tonight and you saw from governor romney, a person not in command of the facts and uncertain and reckless. >> where was he not in command of the facts. >> on iran. he has been all over the place on iraq. he has been all over the place on afghanistan. he said it depends. he agrees with the president's time lines but certain other times it depends on iraq.

he called it a tragedy we're removing trips from iraq and tonight he gave the president a hug on that. he was a bit of a con torgsist tonight. >> do you think he had a strong li against the president when he said that you went overseas and said that america deck at a timed to other countries and mitt romney turned to the president and said we didn't dictate to other countries, we removed dictators from other countries. >> i don't think people score it that way. i think governor romney went to great britain and in 24 hours we friended our closest ally and went and said he met with the british intelligence agency and long called russia the greatest geopolitical ally. we have seen this before. this is what happens when you elect a governor with no experience, zero foreign policy experience. they rely on retainers. >> obama had no experience when he was elected four years ago. >> he had experience in the united states senate working with dick luger for four years on one of the singet greatest issues facing us. he was steeped in expert in

that. governor romney has zero. he has chosen a vice presidential candidate a year younger than me and says the foreign policy experience is voted on war and i have gone to war in iraq. the president is talking about veterans and not about how we send and where we send the troops but how we take care of them when they get home. he understands that. he has increased funding for the v.a. and governor romney chose veterans day last year to propose the vouchersization of the v.a. doesn't mean he is a bad guy, just a whole different set of values. >> thanks very much for joining us. >> thanks, john. >> carl and maria. >> john, thanks a lot. back to the panel here. did you get a sense of the governor's world view even though he might not have been as aggressive as larry would have liked? >> i did. i have to say, and it was interesting to hear john make the comment about women voters. i would be amazed if anyone's vote was changed by what we saw tonight.

first of all, a lot of times it was hard to even kind of see what the differences were. they agreed on a lot. that's a disadvantage to the governor. he really is changing many of his positions that he held in the primary. >> wouldn't you agree with john he needed to come off as a peace maker and disavow war and promote peace and stability. >> you mean romney. >> exactly. >> i think so. the problem is he just ends up i think looking because i think the fact is that he just doesn't have the kind of experience and knowledge that the commander in chief has on these issues. >> i want to say, though, what about men? what about men? men vote. >> good point. >> he is already leading by 9 points. >> he should be leading by more. >> thank you. thank you very much. that's exactly the way those numbers work. i just want to say, again, i don't know, broken record. he makes the points, but he didn't hammer it home. the other side of the coin tonight, and we'll see how this plays, is that what you got from president obama was a guy who definitely wants to, a, slash

the military budget, b, raise taxes, and, c, spend more money. if romney, he counter punched on this that a few times. >> good point. >> i think that was pretty good and i want to see how that plays. he has no program. the president has no program. >> don't go too far. we'll do more after the break. there is a lot more to come in the next hour as we're taking you straight until midnight on the east coast. always entertaining, always smart, former auto executive extraordinary bob lutz.

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in order to be able to fulfill our role in the world, america must be strong. america must lead. for that to happen, we have to strengthen our economy here at home. you can't have 23 million people struggling to get a job. >> we have to do it in a responsible way, by cutting out spending we don't need and also by asking the wealthiest to pay a little bit more. that way we can invest in the research and technology that's always kept us at the cutting edge. >> some of the more compelling moments from tonight was hard to get some compelling moments at times. interesting reactions coming in from all over the world. jack welch tweeting that romney demonstrated he is presidential in every way. >> right. >> which jack has had news making tweets lately, too. >> i would discount that particular tweet. >> my guess is the president doesn't mind that tweet.

>> our panel, did you get from romney what you wanted tonight, larry? >> no. no. in short. >> does it matter to the it ma? >> i don't know. that's a good question, because i think most people have already made up their mind. but as i said earlier, and i'll just repeat it, i think he made some good points on the economy and military weakness and american decline overseas. but i don't think he hammered hidalgo his point home. and i think the president did a good job parrying. >> we got a good performance from the commander in chief. he really hammered this point that it's always really hard to figure out where governor romney is on so many positions. the governor romney you heard tonight on foreign policy was a very different governor romney you heard a few weeks and months ago in the primary. and that's a very tough trust issue for people who are paying attention to the foreign policy issues. >> but are they? >> that's a good question. >> and romney missed an opportunity by not going after the president on his inconsistency in the arab spring. you know, obama is strong on

egypt. he is strong on tunisia. he says nothing when saudi arabia puts tanks in. i was surprised. and the president opened it up for him to come attack him. when he pointed out he was strong in egypt, tunisia and libya and not in iran, and not against libya. he did it and romney didn't take -- no. >> he took a lower strategy. he took a lower strategy on a topic that isn't driving the election. >> right. bottom line. >> he played it safe tonight. >> it was a strategy. >> i think the president did a good job, as we were mentioning at the break about talking about the gadhafi part of libya, where working with coalitions, even though he was the leader of that coalition, he didn't have to put boots on the ground and still actually literally killed the person who had more blood on their hands than the u.s. >> that's a better libya conversation. >> and i think it was a surprise to me that romney didn't then take that and segue into the other libya, but just let it go. >> he was playing it safe. >> that was a strategy thinking

must have been intentional. carl? >> let's get back to john harwood in boca raton with senator marco rubio. john? >> i'm joined by marco rubio, the freshman senator from florida, someone who is a rising star in the republican party. senator, the tone of the commentary that my colleagues have been making is that mitt romney was very laid back, was not as aggressive as the president. the president may have scored more points. tell me if you were satisfied with that strategy by mitt romney and what difference it might make in the rest of the campaign. >> i think he was presidential tonight. this is not a debate society. we're talking about the -- >> it was a debate. >> but this is not a college debate competition. this is a competition to see who the next commander in chief of the most powerful armed forces in human history is going to be. i thought governor romney tonight appeared presidential. i do think the president tonight on some issues appeared rather small in comparison to the questions that were being asked. rather than dealing with big issues in a big way, he appeared petty at times. >> what is an example? >> for an example, there was a

question about iran tonight and iran's nuclear ambitions. and the president went off on some conversation about an investment in a chinese company that mitt romney had. what does that have to do with a nuclear program that iran is pursuing? i think those are the opportunities the president had to be presidential on an important issue of enormous importance. instead he was looking to score some counterpunch point. i don't think that's going to go over well with the american people. that's not what they are looking for tonight. >> who do you think is watching and making a decision based on this debate, if anyone, since we know that 95% of the people have already made their choices? >> you're going to have millions who watch tonight. but then watching over the next few days, the clips, the youtube videos, the commentary as a result of the debate. i think the people that haven't made up their minds are likelier to watch. i also think it's important for enthusiasm. the supporters of these candidates, particularly of governor romney want to stay excited, want the drive people out to the polls. and these debates help with that as well. the kind of performance we saw tonight by governor romney is

only going to make his supporters more excited about going out to vote. >> do you not think the president made any headway by going after romney's inconsistencies by accusing him on multiple occasions of being all over the map on various foreign policy occasions? >> but he wasn't. he used one example about iraq saying that governor romney wanted to see an increase in troops in iraq. what governor romney was saying was we needed a status of forces agreement in iraq, which is precisely what the president himself is trying to negotiate. the one who has been inconsistent is the president, who for example was calling assad and his -- secretary clinton was calling assad a reformer even as assad was beginning to carry out some of these massacres there. so it was a lack of clarity on foreign policy that the president has led which has led to many of the foreign policy problems we now have. >> finally, let me ask you about the state of florida. we've had a very close race here for some time. president obama had a lead. now it appears mitt romney is up a couple of points. do you see the race over in this state. >> i don't think it will be over in florida until it's over.

we have a history of having close races around here for president, you guys may remember. i hope it won't be that close this time around. but it's going to be close. florida is always competitive state. we're going to keep working hard. i feel very good about where things are. i would rather be us than them. >> the senator from florida, thank you so much for joining us. >> thank you. >> carl and maria? >> thank you so much. john harwood with senator rubio. going forward, what do you think this debate represents for next two weeks? how important was this debate in terms of actually moving the needle and changing minds or getting that independent to say here is the person that i trust? >> i don't think that it will have any impact on the next two weeks from changing where this race stands for two reasons. one, the president's base didn't want to hear the president talking as strongly as he did at times on issues like iran, issues like syria. romney, on the other hand, his base wanted to hear more. they wanted him to go out and talk about how the united states needs to lead in the world. and so i think it has no impact

on the race. we're in a tight ball game, and we're going to keep it that way. >> no disrespect -- >> they try to connect the dots on the economy -- >> no disrespect, but since i'm an obama guy, i would disagree. they like that he said continue sanctions in iran. they like that he said he didn't want to put soldiers into syria. but they also liked that he said there is a red line, and if iran got a nuclear war. that would be there. i think they liked what he said because he talked about things working. >> this is not about evading issue for the democratic base form policy. it is for republicans. so as a result of that, i think that we go back to the economy. this is now a game of turnout. this is all about whose base is nor energized and who has the better ground. >> you may be right. i think that makes some sense. but here is where robert may have a point. you know, mitt got such a big bounce out of the first debate. and the president began to

neutralize that in the second debate. i think he did more of that tonight. so i think whatever kind of trending you saw with governor romney in the polls, i suspect that at this point -- >> i tend to agree with jared on this. this is such a strange race. even going back to the primaries, polls moved after debates. and they continue to move after the debates in the general election. and i want to see how the polls move in the next few day, because i think the president made a buck or two for himself. >> move it on because i don't think people kept watching after 20 minutes. >> they'll see it tomorrow. >> it will be 75 -- >> what rubio said is right. people are going to look at it on youtube and everything. that's one thing i also want to say. in romney's summary, one thing i really liked, which i think helped him in the first debate was talking about reaching across the aisle. i think people are so fed up with the fact that we can't fix the fiscal cliff, we can't get anything done in washington, d.c., military budgets, taxes,

anything going bankrupt for christ's sakes, which most people think we are going bankrupt. so i think romney got that in. sara, i just don't know if it was too late and powerful enough. i think that's an independent thing. was it too late? was it powerful enough? to really get heard. >> i don't think there were many people who had tuned in, particularly in the last half hour of this debate. >> why? because it was foreign policy? >> they spent 57 minutes on the middle east and ten minutes on china. >> listen -- >> here is a good example of the two candidates talking about in this case al qaeda as the president turns it to russia. take a listen. >> i'm glad that you recognize that al qaeda is a threat, because a few months ago when you were asked what is the biggest geopolitical threat facing america, you said russia, not al qaeda, you said russia. in the 1980s or now, calling to ask for their foreign policy bank, because the cold war has been over for 20 years. >> russia i indicated is a

geopolitical foe. excuse me. it's a geopolitical foe. and in the same paragraph i said iran is the greatest national security threat we face. russia does continue to battle news the u.n. time and time again. >> so that -- larry, there was some substantive discussion. >> he came right back. he came right back at him. i absolutely agree with that. and i think he came right back at him on a number of things. that is what makes this such an odd debate. >> but your point along with jared is that get the transcripts, those things add up. they're currency. and you think they're continuing to add up. >> i'll bet you whatever snap polls we're going to see are going to show president obama a pretty clear winner, a very clear winner. that's my point. whatever momentum he had coming out of the second debate, i think he probably boosted that. >> if we put our economic hat on, tonight when the president talked about china, he tooked about the thousand jobs because of the tire industry, and he talked about the nine sanctions that he went after them on. that was all for ohio, all for

ohio. >> we agree on that. >> just to be clear. >> and that worked. >> and by the way -- >> only from behind, we should lead from -- >> actually injected when romney talked about china manipulation, he said wouldn't that cause a trade war, which was interesting. that is the one time. >> to evidence what you said, michelle, and sara, you agree, the twitter volume was down tonight. >> way. not surprised. >> 6.5 million total tweets down from 7.2 in the second and down from 10.3 million in the first debate. so you're right there. was lower viewership. there was lower twitter activity. >> except on cnbc which was record. >> well, let's take care of it, shall we? senator dick durbin is an illinois democrat, and he joins us right now along with john harwood. john? >> maria, we've got senator dick durbin, a former colleague of barack obama in the senate.

let me ask about the president's performance tonight. he was much more aggressive than mitt romney. in some ways, he looked more like the challenger in the race than what he was trying to make up ground. do you think he struck the right tone in doing that? >> he learned a valuable lesson in denver, standing there being presidential doesn't work. there are two candidates on stage. they're going to basically try to highlight the differences. so in the second debate again tonight, the president really brought the debate to governor romney. and i think at the end of the night, count how many times governor romney said well i agree with that part of the president's policy, or something i said earlier in the campaign is no longer operative. so i think at the end of the night, the president looked strong and decisive. and governor romney did not look like he was in a comfort element there on the stage. >> now romney's aides said before all they wanted to do was no mistakes and look presidential, stay on a par with the president and let the economic issues drive the election home for them. what is wrong with that thinking? >> because you're playing not to lose, rather than playing to

win. and of course romney had to. when it comes to the basic foreign policy positions of obama, he doesn't disagree. he just wants a little more of this, a little less of that. there is no dramatic difference there when it comes right down to it, and the president can point to specifics. yes, the war in iraq is over. yes, the troops are coming home from afghanistan. yes, osama bin laden is gone, and al qaeda is on the run. yes we have a working policy of sanctions in iran that is putting pressure on them in ways that we've been praying for years. it's working. so by and large, the president's foreign policy was vindicated by romney many times today. >> maybe it's actually they agree on foreign policy and there wasn't enough there to have a real sharp debate and controversy among some of the more important issues in foreign policy. >> well, if that's the point, then the obvious question for the american voters, if our foreign policy is working and they both agree, stick with the president who has executed it well for the last four years. >> hey senator, one thing that

sort of got lost in all the foreign policy discussion was something out of the president saying that sequester is not going to happen. does he know something about what is going on in the senate that the rest of us don't? >> i can tell you when the president is reelected. i expect after the reelection for him to sit down, even during the lame duck session and come up with an approach that will avoid the sequester and really move us on a path toward reducing the deficit, while still pushing this recovery forward. we're still in a very tentative position here. we want to move the economy forward, creating jobs and strengthening businesses, but get serious about the deficit. i know the president is committed to that. >> what happens in the lame duck if mitt romney is elected? >> i can't even imagine. if we try to follow his plans, which call for $5 trillion more in tax cuts, $2 trillion more in defense spending that has been asked for, it throws everything into a tailspin. erskine bowles of the simpson/bowles commission said romney's numbers just don't add up. >> are you going to work with him? what are you willing to do to work with him if in fact he is

elected to get compromise and get business that the american people care about done? >> i'm not going to make a mitch mcconnell statement. whoever is elected president, he will work with them for the gad of this country. >> back to you. >> we're going to replay that later. >> do we ever, if we're not going to have a sequester, we're not going to have the military cuts, we're not going to have the domestic cuts do, we ever cut spending? do we ever? >> wait a second. when you said that, i had forgotten that he -- >> he said that. >> he blew right by that. that was a really interesting statement. and if that's true, the president says it's not going to happen, sequester. what he is essentially saying, this is going to make you very unhappy, larry. what he is essentially saying is the upper end bush tax cuts will expire. >> that's right. >> that has been -- >> i think he has been keen on that. >> that's a deal that he has been sticking from the very beginning. >> and sticking with, that in fact just recently, administration officials have said look, he stands ready to veto any legislation that tries

to block. >> the majority of senate democrats have voted for that, and the president has been very strong spine on that point. >> i agree. what troubles me, though, is the spending cuts. i believe a smaller government is pro-growth and absorbs less capital and helps business. and i don't hear these guys wanting to cut spending. and if the president says the guester is not going to happen, i'm going to take that at face value. i mean, i think mitt romney is the spending kuttner this race. but if the president is no sequester, when is it? bernanke says don't cut spending now. timothy geithner, don't cut spending. it's going to hurt the economy. is there ever a time when it's right to cut spending? >> on the fence, mitt romney wants to spend more than the president. how does that fit -- >> well, he's got. i don't want to defend his entire program. but they've got going from 24 to 20% on gdp spending that comes to a interruptle trillion. what they're saying they're going to go around the fence and cut it on domestic and in

entitlement reform. >> and more revenue. >> and grow the economy for revenue. all i'm saying is i agree with this. it's a great insight. obama said no sequester. and i just thought to myself -- >> let's talk the numbers. >> when will we ever cut spending? >> the sequester is 1.2 over ten years. if you cut $60 billion, you give yourself six months. okay. you get through the debt ceiling debate. >> the numbers aren't that big. >> so you can easily cut $60 billion. you can cut $60 billion out of afghanistan. and you can get through -- >> no, you cannot. it's a double count. >> i don't think so. >> they've already taken the money out of afghanistan. >> i don't think he means -- i don't think the president means that he doesn't want to cut spending. in fact, in his budget, the way he says we'll deal with the sequester is by offsetting it with more revenues, which i don't like. but that is part of his plan. but also considerable spending cuts. and in fact, and this is underappreciated.

thus far, this president and this congress have cut $1.5 trillion in spending over ten years. $1.7 trillion in interest added savings. that's on the books. >> overall making a dent and moving the need until terms of debt reduction, do you really move the needle by not extending those tax cuts just for that very small group? >> it's a trillion dollars over ten years. if you believe bowles/simpson, you need $4 trillion in order to stabilize the debt to gdp ratio in the budget window that gets you 25% of the way there. i think that's real money. >> and i must say i don't think the president's spending cuts are real. i think when you look at those numbers, i agree about the revenue side, that's what they want. and i also agree he wants to cut military spending. that's what he wants to cut. >> did you find odd hardly any mention of the eurozone, greece. >> romney mentioned once that he doesn't want us to become greece. >> you're right. it was missing. >> we've criticized all the

moderators of the debates. if i had a criticism tonight, i'll say it again. 75 minutes on the middle east, ten minutes on china, nothing on europe. unbelievable. >> even the middle east, sara, i was waiting for someone to tie to it gas prices and reach out to an undecided. it was not explicit, if they did it at all. >> no they didn't. and romney i think really did well on his economic points. but again, just didn't go after the president the way he could have. he was -- he acted in this debate like he was five points ahead as opposed to being tied. >> right. >> the gallup does have him. >> that's if you believe gallup. if you look at all his polls averaged. >> it's much higher for him to be aggressive tonight on a topic that he is not as comfortable with, on a topic that doesn't move the needle. tonight was showing he knew parts of the middle east, just like biden and ryan did the other night, that he had command

of certain topics. >> they wrote romney has not been his best when he tried to add a global dimension to his campaign. that changed a little bit tonight, don't you think? >> i think he won on economic issues. but on foreign policy, the president won. >> i hope you're right. >> it wasn't a trouncing, though. >>. no. >> and interestingly, i think the two, michelle and carl bring up a great issue about europe. i think the reason they didn't go there, is this about are you feeling safe. the world a safer place? and it wasn't so much about underlying economic dynamics. and i think the intersection of u.s. and european economic dynamics is important, is essential, is fascinating. that's where a lot of us live. but it wasn't -- >> it might be even more boring than the debate we saw tonight. >> sitting next to a former global banker. >> i think you have to bring up the euro crisis when you talk about -- >> international affairs. >> and that would have been romney to go a little bit further to say if we don't spend properly, we could end up like europe.

>> going to be putting more money into the imf. are we going to be bailing out greece? all these issues are on the table. >> romney has a big debt problem himself. once again, we can argue about this. i really don't think ever has a good argument for how the heck are you going to pay for your $5 million cash cow. >> i think he did a great job in the first debate. i think the cap on deductions, the economic growth incentives is a great job and the spending cuts are great job. the troublesy didn't hear it tonight. i didn't hear it tonight. >> take a quick break. coming up next, the fact checker scott cohn and his team on the case. we'll see if the president and governor romney were telling the truth, or not, scott. >> i guarantee that the economic part. >> we'll be right back. two years ago, the people of bp made a commitment to the gulf.

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welcome back to our special coverage, the third and final face-off between president obama and governor romney has come to a close. senior correspondent scott cohn and his fact checkers have looking at some of the disputed elements in the debate tonight. >> a lot to sift through here. the auto bailout produced one of the liveliest exchanges, centering on the new york op-ed about romney that he did not write, let detroit go bankrupt. >> the idea has been suggested that i would liquidate the industry, of course not. of course not. that's the height of silliness.

i have never said i would liquidate the industry. >> governor, the people of detroit don't forget. >> well, mitt romney did not write in that 2008 op-ed that he wanted to liquidate the auto industry. he did say he wanted it restructured through bankruptcy with government guarantees after bankruptcy. that is a key difference from what happened with the government providing financing for bankruptcy. experts and the obama administration say that was the only way to pull off the rescue. foreign policy is completely intertwined with defense policy, and defense is intertwined with money, huge money. the candidates clashed on iraq where still wants a defense presence. >> indicated we should still have troops in iraq. >> i'm sorry. i indicated -- i indicated that you failed to put in place a status of forces agreement at the end of the conflict. >> both candidates are taking some liberties here. here is what governor romney said october 8th in virginia. quote, america's ability to influence events for the better

in iraq has been undermined by the abrupt withdrawal of our entire troop presence. but he then went on to say that the president had tried but failed to get agreement for a gradual drawdown of the troops that is correct. the president, though, wanted 5,000 troops. governor romney had called for as many as 30,000. on defense spending, romney was critical of what he called a trillion dollars in defense cuts, half a trillion from the president's budget. another half a trillion if sequestration goes through. in fact, the half trillion in the budget cuts, the rate of growth, not the absolute budget. and romney claimed the air force and navy are historically small. >> i want to make sure that we have the ships that are required by our navy. our air force is older and smaller than at any time since it was founded in 1947. >> the president quipped that we also have fewer horse and bayonets, but let's slice through this more. the air force is the smallest it has been since 1947 in terms of aircraft, but it has more active personnel. the navy does have fewer ships than it had during 1917, but it

has more than the bush administration. it has grown in the obama years there is more to check, including the president's claims on china, education. so we're going to be back for one more fact check later in 24 hour. >> what people want to know is whether or not the military does actually use bayonets. i've seen a report it's been discontinued in 2010. i'll bet you special ops uses some, some time, right? >> they probably do. and i'm sure they probably still have horse taos. we'll put that on the list. >> thanks, scott. doing good work for us tonight. we asked you to go to cnbc.com to tell which candidate won tonight. president obama 67%. governor romney 30%. and 3% said neither. reflecting a small group of undecideds. >> a small group of undecideds. i think it's extraordinary if those people are still undecided. can you have that big of an undecided group at this moment in time, two weeks before the election? >> i don't know. that's going to be -- that's why the ground game, sara, is now key. >> it is key.

and if you look at this race, it's also about the electoral college. and a lot of these swing state polls have moved to romney. and you look at the fact that there is about 130 electoral votes up for grabs, but it all sort of centers to the midwest. and this is where the president has maintained a slight 1 to 3-point lead in ohio, wisconsin, and iowa. these are the states that romney needs to go and make ground if he is going to win this race. >> so romney appears to have north carolina in the bag, at least according to this past week, right? >> yeah. the president hasn't been there since right after the convention. i think that obama campaign has largely written north carolina off. >> so what is at a fulcrum right now? florida? >> florida is tending toward romney, although just slightly. i think the fulcrum point is virginia, it's ohio. those are the two states that ultimately the pathway for romney to win gets much easier if you can win ohio.

he can still do it without ohio. but he's then got to win virginia. he's got to win pennsylvania or michigan or wisconsin. >> but how feasible is that to get those electoral college votes in ohio? >> so just a reminder about ohio unemployment rates, because i was just running these numbers earlier. the unemployment rate in ohio topped out at 10.6%. so the nation topped out at 10. now it's down to 7%. now% is too high an unemployment rate, i grant you that. the nation of course at 7.8. but they started out a lot higher, and they're now a lot lower. and that's got to be helping the president tonight. i can't believe there is much on foreign policy in ohio that is going to move the dial relative to theed kinds of -- >> when you've got a much lower unemployment rate. we heard from two mayors actually earlier. and one of those unemployment rates was 5.9%. >> i'm sorry, sara. >> no, that's okay. i was just going the say if you look at this debate series, i think that romney did one thing through these three debates,

which he established himself as somebody who could serve on the presidential stage. so people doubting the president now look at these debates three later and say yeah, i see that guy as president. i can support him. i can get behind him. but at the same time, he's got go close the deal in these key states. and as the economy gets better, the key question is going to be, which is economy is getting better, as you pointed out, but the question is it enough? and i don't think we're going to know that until election day. i think it's going to be that close. >> yeah, another jobs report to get through, michelle. >> gdp report. >> and that's going to be important. and the trajectory that jared is talking about is so crucial. what is the difference between top and bottom. that's going to be influential in ohio. at the national level it hasn't really been that much of a move, or not big enough necessarily yet. we'll have to see. that last jobs number, ultimately is going to be extremely important. >> how much damage can you really have between a jobs report on a friday before the tuesday election? are they going to be that

impactful? >> yes, absolutely. because this is the topic that is driving this election, absolutely. if it's a really ugly number, it moves undecideds over to romney's side. >> do you have thoughts on this team, john harwood? >> i wanted to first of all disagree with michelle on the importance of that last jobs number. i think we have seen that these numbers have not -- these jobs numbers have not in fact moved poll numbers very much. when the president got the very favorable 7.8 after the denver debate, didn't make much difference. things kept moving to romney. i wanted to touch on something, though, that sara fagen was saying. and it matches what ed gillespie in the republican campaign told me a few moments ago. through the debate period, mitt romney establishing himself as a presidential level player was exactly their goal. and that was their goal tonight. the question's going to be the follow-on. does he also have enough momentum to get over the hump in the states in the midwest that sara was talking about.

they think they do. i don't think that's clear from the poll numbers that we've seen and whether their gamble was right on that may determine the outcome of the election. >> looks like a party tonight in the spin room. thanks a lot, john. we'll see you in a few moments. when we come back, back to the budget balancers. david walker of the comeback america initiative. and bob lutz, worked for gm, chrysler and gm. his thoughts on where made in the usa really stands two weeks before the election. that's next.

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they sell us about this much stuff every year, and we sell them about this much stuff every year. so it's pretty clear who doesn't want a trade war. >> if we had taken your advice, governor romney, about our auto industry, we would be buying cars from china instead of selling cars to china. if we take your advice with respect to how we change our tax code so that companies that earn profits overseas don't pay u.s. taxes compared to companies here that are paying taxes, now that's estimated to create 800,000 jobs. the problem is they won't be here. they'll be in places like china. >> yeah, he's -- >> we're just discussing at the table the theater behind that answer from mitt romney. doing this to describe a trade war might seem a little simplistic, maria, but it works. >> it works on television. it really does. >> they have something to lose as well. joining us to break down the debate tonight, michael porter, a professor at harvard business school, david walker of the come

back initiative, and bob lutz. gentlemen, good evening to you all. bob, be a theater critic for me for just a moment. it's been said tonight that the president tried to engage repeatedly the governor into some sort of contentious fight. that's what challengers do. it's what you do when you think you're behind. do you agree? >> are you asking me? >> yeah, bob. >> sorry, i didn't get -- yes, that's what challengers do. but, you know, i think the natural advantage in this debate clearly went to obama. he has the daily briefs. he has been immersed in foreign policy. he has access to the cia reports. he is the one that meets with people around the world. so i think he had the natural advantage. and in my judgment, romney did exceptionally well, holding his own. he had the stature of a future leader of the united states. he looked calm. he looked confident.

he had good command presence. and every time he was able to divert the discussion to questions of the domestic economy, i thought he was particularly strong. >> yeah, that's great analysis. it's true. he definitely did play it safe versus obama, who has -- the president has all of the information in terms of foreign policy. >> sure. >> but let me get your take, all of you, on what we've been talking about here at the table. the fact is michelle caruso cab cabrera, no mention of europe and the european debt crisis. did we talk about all the pertinent issues when it comes to foreign policy, or was this too focused on middle eastern policy? >> well, i thought that i was surprised -- go ahead. who is going to go? >> you go ahead, david. david. >> all right. i was surprised that they did not talk more about europe. but let's face it. this election is not going to get decided on foreign policy.

the president has a natural advantage on foreign policy. frankly, i thought that governor romney clearly exceeded expectations with regard to his knowledge on foreign policy. this election is going to get decided on who is going to do the best job on growing the economy, generating the jobs, and putting our finances in order. and the biggest national security threat that we face is our own fiscal irresponsibility. >> yeah, which should have come up more, i think. and it should have been related to economic policies a lot more than it actually was. do you all agree? michael porter, what is your take on that question? >> maria, i think the biggest foreign policy issue facing america is indeed our declining competitiveness. we have a structural problem. it's been building for more than a decade. and there is a number of fundamental steps we have to take to kind of get our economy moving in the right direct. the number one is a budget compromise. and without that, america's influence in the world, our ability to get other nations to join the trading system, to do what we need to do, it's just not going to be there.

so this is job number one for the next president. and the question is who is going to get that job done? who is going to be able to get that compromise through? who is going to be able to work with all the constituencies and actually make progress. because my gosh, we got to make progress. >> bob? >> who won the china question tonight, bob? >> well, i think romney kind of won that because some of obama's statements, if we hadn't -- if he hadn't saved the automobile industry, we would all now be driving chinese cars is just patently untrue. the chinese auto industry is absolutely not in the shape yet to export legally cars that meet u.s. legal requirements and meet the quality requirements of the american public. >> but do the voters dough know that? >> it's silly. >> but do the voters know that? >> well, i guess it was a sound bite that works. but the reality is we would now be driving korean and japanese cars, which we do plentyfully

anyway. but i thought that romney's statement about where china does not want a trade war with his hand motions of we import this much, we export that much. >> right. >> i thought that was very effective. that was effective television. that sort of adding a visual. and underpinning his argument is something that anybody can understand. that's the guy that is benefitting the most from trade is not going to want a trade war. and i thought -- i thought he handled that very effectively. >> let me just add the that i think one of the fundamental problems in america is we just lost our leadership in the international economy, in moving the international trading system in the right direction. and china is one example. but there are many other examples. we've been filing a lot of trade complaints. but we haven't been actually opening markets and doing deals. >> that's right. and many of the trade deals that were completed during this

presidency actually were negotiated in the former administration actually. gentlemen, thank you very much. appreciate your time tonight. and we'll see you soon. we appreciate it. let's get back to john harwood. he is right now with the chairman of the rnc. over to you, john. >> maria, i've got reins priebus our polls shows president obama beat romney two to one. romney didn't bring the fight. he was too passive. >> i didn't see that at all. once again we showed that mitt romney was intelligent, reasonable, presidential, he should be commander in chief of this company. and 90 minutes of that to the american people that governor romney is not who president obama is trying to portray, that's 90 minutes of gold to us. it was gold in denver. it was gold in long island and it was gold again tonight. >> but you would agree that

president obama with his aggression going after romney scored more debating points? >> i didn't think so at all. i thought that governor romney did a great job tonight. i think that he clearly showed that he is ready to be commander in chief. and i thought he did a great job. i think he did a great job, once again, showing that this president, while he is in love with the sound of his own voice, he can't follow through on a promise, he promised he would bring more respect to the united states in north africa and the middle east. he didn't do it. we have a mess in libya. we have the keystone cops between the white house and and not just over the president's record on domestic policy, but what he is doing abroad. and thing is a lot of questions out there. i think it was good night for governor romney. >> maria? >> let me ask you a question here on the libya exchange. do you feel a bit disappointed that the governor did not pounce on that situation a little more? it seems like the one glaring opportunity that he had to actually talk about when the american people knew what and what the administration knew and

why they didn't share it when they could have, did he have a missed opportunity on that front? >> i don't think so. you've been pounding away on this issue. you know what? there are four live that have been lost. obviously it's a very sensitive issue. i think it was very clear. and i think the american people understand that no one in the white house, the state department is clearly setting a tone in this country as far as what happened, when it was known. i mean when it comes to shooting first and aiming later, the president takes the cake in what happened over there. and it's unfortunate. i thought that he laid out the case. first question out of the box, and again, i think it's a tragedy, and i think there is a lot of questions, and i think this thing is percolating. i think it's simmering, and i think it's continuing to boil. i think it's going to be a problem for the president. >> republican national chairman reince priebus. >> trying to hold the candidates

to the withhold truth, nothing but the truth. he'll let us know if the president and the governor were on the straight and narrow tonight. that's next. [ male announcer ] the 2013 smart comes with 8 airbags, a crash management system and the world's only tridion safety cell which can withstand over three and a half tons. small in size. big on safety.

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♪ scott cohn and the fact checkers were watching and listening to this debate, especially closely tonight. scott, what did you find? >> yes, carl, the marines still use bayonets and the army infantry in pakistan still uses horses. let's talk china. each candidate trying to sound tougher than the other guy, and the president making this claim. >> we have brought more cases against china for violating trade rules than the other -- the previous administration had done in two terms. >> on the surface, that is correct. eight cases in the past four years, compared to seven in president bush's two terms. but that doesn't tell the full story. for example, a peterson institute study characterized the administration won on tires quote, saving few jobs at high

cost. education is key to america's role in the world, both candidates agreed. and that brought governor romney's record in massachusetts into focus, the governor pointing out that education reform in his state made massachusetts schools tops in the nation. >> that was ten years before you took office. and then you cut education spending when you came into office. >> and we kept our schools number one in the nation. they're still number one today. >> they are still number one, but the major education reform in massachusetts came in 1993 under republican governor william weld, working with democrats in the legislature. ten years before the governor took office. governor romney's first budget did cut education spending, that, and the nonpartisan spending and policy center wrote in 2003 that the governor also relied on questionable assumptions and tax hikes. two other quick ones. the governor said the rate of business creation under president obama is the lowest in 30 years. that is true. the president said oil imports are the lowest in 20 years. he is off by about half. it's the lowest in ten years.

lots more on this tomorrow here and on cnbc.com. >> all right, scott. great stuff. fact checkers on the case. the prospect of government spending cuts and the fiscal cliff did come up tonight, despite the fact this was a debate designed to focus on foreign policy. >> our navy is older -- excuse me, our navy is smaller now than any time since 1917. the navy said they needed 313 ships to carry out their mission. we're now down to 285. we're headed down to the low 200s if we go through a sequestration. that's unacceptable to me. >> the guester is not something that i proposed. it's something that congress has proposed. it will not happen. the budget that we're talking about is not reducing our military spending, it's maintaining it. >> very important point there. sequestration will not happen is what he just said. michael granoff is with us, the rest of our panel once again back with us. michael, good to see you. thanks for join us. >> thanks, maria. >> let's talk a bit about that. sequestration not going to happen. can the president avoid it? >> well, i think in this case,

you may have one of those situations where all of the parties involved, republicans and democrats have a good reason to avoid sequestration, and therefore you probably have a higher chance of some agreement than you do on other budget-related issues. >> can i make a point? >> jared? >> interestingly, in terms of what hurts the economy the most, it actually is the automatic budget cuts, the sequestration relative to the tax increases because of two things. first of all, the tax increases imply changes in withholding tables. the second, the secretary does not have to implement those right away if he thinks this is going to be a deal. and secondly, the other tax increases don't happen until april 14. they happen kind of retroactively. if you look at impact on the gdp on the economy, it's the spending cuts that bite you the hardest the fastest. so if the president is right about that, that's actually good economic news. >> can i challenge -- as much as i love jared, the increase in marginal tax rates. >> uh-oh, here it comes. >> the increase in marginal tax

rates have a very negative effects on employment, and growth. it will be very negative effect and it will be discounted immediately. the reduction in spending are so small. these are small cuts per year. in fact, in almost every case, jared, and certainly in the aggregate, they're not a reduction in the level. they're a reduction in the growth rate. and that's why to some extent this game has to be understood. you have yourself a baseline. i'm going to be like romney. you have yourself a baseline. and they always want an increase. this is the increase line. what they're doing is bringing this top increase down. it's like buying a chevy instead of a mercedes. >> but year still buying. >> that's correct. you're still buying. oh, heck, the larger government is, the slower economies are. there are so many studies about this in europe and asia. the smaller government is, the faster economies grow. so i want to see this sequester, and i want to see the tax rates stay in place. >> but they won't stay in place if the president gets reelected. he is very clear. >> the house republicans --

>> fiscal -- >> he may be bluffing, though. >> fiscal contraction. >> why would you say he is bluffing? he hasn't been bluffing. >> if you're teaching anything, larry, it's fiscal contraction is bad for economies that is the lesson, the screeching out of europe. and second, the president is all spine on insisting upper end bush tax cuts -- >> it's not an either or. for him to raise -- for the fiscal cliff, as it approaches, it's going to raise taxes on everybody. so is the president really going to have as his legacy somebody who raised taxes on the middle class? he's got the bully pulpit -- >> you're saying the treasury doesn't necessarily impose taxes. that's what you're saying. >> that has to do with wage taxes. but look, no, you've got a good point. but the fact is the congress and the president all agree on 98% of this tax part of the fiscal cliff. it's just the 2% above 250. >> let me just say here is what -- i won't name his name.

but i'll say he is a senior republican on the ways and means committee and the joint economic committee. he said to me two or three days ago, the election will adjudicate the entire issue of the fiscal cliff. and he was very clear that is to say republicans in the house know they will have to give obama his due. >> sure. >> what we don't know is whether the senate goes republican or democrat. we don't know that. and that's going to matter. >> which michael raises a great question. our whole audience is full of investors who are trying to plan their way around this binary outcome that is the election, and after that of course the fiscal cliff. what do you tell them at this point? any way to plan at all? >> well, of course we live in a pretty noisy world. and it's hard to -- it is hard to plan. most people think that the harshest part of the fiscal cliff will probably not come into effect because as i said, so many of the stakeholders and

participants have a reason to kick the can or get something done. and i think that's likely to happen. and if that happens, we will continue to live somewhere between a robust economy, let's say, and a crisis economy. and in a low normal environment, things begin to happen. i run a private equity business. we own interests in a couple of thousand companies. and i can tell you that for the most part, they're beginning to see steady and slow economic growth. >> right. >> and that's being reflected in housing numbers. it's being reflected in unemployment numbers. it's being reflected across the board. it as much as people would like to see? no, it probably isn't. but is it beginning to be felt, not only by businesses, but by people out there? i think it is beginning to be felt. and it's then beginning to get reflected in consumer confidence numbers and numbers like that. >> right. >> and the investors take those kind of things into account when they think about how they're going to deploy capital.

>> we'll see what this means in terms of moving the needle for voters in the coming days here. john harwood, final comments on this, the final debate? >> president obama was more aggressive. he scored more debating points. mitt romney hugged close to obama's positions. the question is that going to benefit president obama? one republican congressman told me both sides believe they won this debate. and we're going to see from the polls whether that is born out. >> of course, our own survey, 67/30. i like how it started out foreign policy, and even we brought it back to domestic. larry kudlow, thanks to you, sarah feigen, jared bernstein, robert wolf, you guys are the best. we'll see you tomorrow, maria on closing bell. >> i'll see you on "squawk on the street." >> that does it for our coverage of the debate tomorrow. tune in for squawk at 6:00 a.m. you can always go to cnbc.com for continuing coverage, 24/7. good night. in america today we're running out of a vital resource we need

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