hundreds of people have turned out a city council meeting in their support. the mayor of the city said i will launch an independent investigation. our take is, hey, go ahead and wear the city-issued swim suits and use the pool as long as you didn't use do it on the company dime, let's go. how does it go? oh. doing that, okay. no, i draw the line. on that note, here is "piers morgan tonight." tonight a moment of crisis or a moment of truth? no longer secret mitt romney tapes. this morning in the corner governor bob mcdonnell and over here in this corner jep fer granholm. the questions that could decide this country's future. tonight, we will talk to larry kudlow on the debt and the mitt romney gaffe. and a species of a republican

and hollywood, and i will talk to kelsey grammar about his idea to keep america great. >> i think that small government is a great idea. i always have. i think that larger taxes are a good idea. i always have. >> this is "piers morgan tonight." good evening we start with breaking news and live pictures where mitt romney is in a rally, and we will keep an eye on that. and also an attack in libya that killed ambassador christopher pace. >> the tape came out a couple of days ago with the president saying that he believes in

redistribution. i don't. i believe that the way to help people who have higher incomes is not to take from some to give to the others, but create an economy so strong it lifts everybody. >> virginia's republican governor bob mcdonald says why he is standing up for mitt romney. welcome. >> hi, piers, good evening. >> let me start with a simple question for you. did you agree when mitt romney said that 47% of americans are victims who basically scrounger off of the states? >> well, mathematically, the number was right, 46.4% of the people pay no federal income tax. i think that he would agree that he would not have said it this way, but with the lousy obama e kconmy, that unploem ploimt ove 40%, and food stam republicans the highest in history and entrepreneurship in the lowest

level in 30 year, and so we have to do better, and we need a job creator and i believe in that part, we need more jobs created because we need more people working. >> for the american people to throw out barack obama, they have to believe that mitt romney understands their cares and concerns, and can do something about it. it is very hard for them when all they see in the last 48 hours is a sound bite of him saying that he does not care about nearly half of the population. his words, not mine. >> well, it shouldn't have been said that way, and i think he would agree. but i didn't read the full context that way. he wants the economy to be better to create more taxpayers to have more people funding government to do something about this $16 trillion national debt. i mean, that is the larger takeaway. but he certainly would not say it that way again, but the broader point about to have a

champion for the small businessman and a debt reducer and a job creator, i think that is a good point and a big contrast with the president. >> let me tell you the results of three polls in three key states. one is michigan, mitt romney's home state among likely voter, barack obama, 52%, and mitt romney, 44%. and now virginia, your home state. barack obama, 50%, and mitt romney, 46%. then wisconsin, paul ryan's home state, obama, 51%, and mitt romney, 45%. a clear pattern now emerging in the three states that have particular resonance to you and paul ryan and mitt romney of a lead and momentum in the favor of the president. what are you guys going to do about this? >> well, i would rather be ahead

than behind, but we were down by eight in the margin of error, but we have work to do. the ground game is critically important and we did better than four years ago in virginia, but i would say that what mitt romney has done well is being able to make out the case why barack obama shouldn't with be re-elect and this is 8% unemployment for 43 months and crushing an unsustainable debt that the president has failed to lead on but what he has not done as well as we need to is to say, here is what i a will do and what is the case for mitt romney to do and you the average american family, the middle class back on the road to the american dream and prosperity is the closing argument for the last 45 days, piers. i can tell you that the independent voters in virginia just want results. they don't don't care about the party politics, but they want to know who has the best ideas of military and spending and i think that mitt romney will make a case in the end, but in the close vote i think that romney

wins in the end of the day in virginia. >> my, what optimism. the last two weeks have been a di s disaster as far as the republicans have been concerned. >> well, we have had better weeks. >> you have to be twitchy that if this carries on, barack obama won't win in a close race, but a comfortable margin if it carries on so this campaign has to regroup and refocus and do something sharpish doesn't it? >> well, i'm not nearly that pessimistic at all. obama won virginia by seven and i won by 18 the next year so that the independent voters really make up their mind oftentimes right near the end. i don't think that the more mitt romney, and i think that i agree with you on this that mitt romney has to continue to focus on what he started the campaign with six months ago in earnest and that is that we can do a lot better. president has tried, and his policies have failed.

you can't have four years of unemployment over eight% and a crushing debt and gas prices doubling and the entrepreneurship at a low and the high level of people on food stamps and call it a success for the middle class. so he has to make it clear why in a romney president, it is going to be better access for people in that -- i'm not at all discouraged. i believe that we will have financial parity four years down the road. we were crushed on spending two to one, and i think that we have a decent chance to win and it is margin of error, four point, and the independent voters have not made up their mind yet. >> governor mcdonnell, i a admire your optimism, and you are valid that there is a long way to go, and mitt romney can have a lot of firepower, if he

will quit committing gaffes. >> thank you, piers. >> and here to argue the other side is jennifer granholm, the host of the current tv "the war room with jennifer granholm" and author of "a governor's story." how are you? >> great. thanks for having me. >> have you calmed down from the barnstorming performance? >> well, it was so much fun, piers, because the crowd caused a wave, and i rode it. >> at one bit, i thought you might have exploded at one stage? >> well, it was a lot of fun. i can tell you that. >> i loved the enthusiasm. let's take a look at it here. >> barack obama! when america will live with losing 750,000 jobs per month, who gave us a lift? barack obama! when american markets broke down, who gave -- >> well, a fabulous response, i have to say. >> well, i do really attribute

it to the crowd. in the back, honestly in the back they say that you have to keep going, because they were worried about the timing and the crowd just kept getting louder and louder and chanting, and the message was right that the auto bailout and the rescue, it saved more than just jobs in michigan, but all across the kun tcountry the way to call out the states was a way to get them excited. >> and let's turn to the big story erupting all over washington and indeed america which is whether mitt romney's campaign has death charged itself through his own words and you heard the argument through one of the supporters, and do you believe he can survive this? what is the view from the democrat side? >> well, obviously, bob mcdonnell, and bless his heart for trying his best to put on a stiff upper lip, but honestly, i don't know how he can diss half of the population and it is not just dissing them, but it was a condescending and unbelievably

insensitive way of insulting them and calling them victims when nobody as the president said that nobody wants to be a victim, and you know, if this is not the final straw, obviously, he's got a couple of debates and three debates to be able to resurrect himself, and i don't know what is. >> well, one thing that may save him is that we are a news cycle industry where everything lasts two minutes and already a tape coming out of your beloved leader, the president, and apparently talking about his love of redistribution of wealth, and the republicans have reacted very fast to this and they have rattled out a new attack ad. take a look at this. >> if you have been successful, you didn't get there on your own. >> i actually believe in redistribution. >> which suggests redistribution ofwell. >> if you have a business, you did not build that. somebody else made that happen. >> this is the real obama coming

out of the closet? >> well, what do you have to say to that, jennifer? >> well, the redistribution and barack obama saying that he wants to say that we have a fair society and mitt romney who is obviously interested in redistributing up, and cut from the middle-class and preserve the tax breaks for those who make the most. redistribution cuts both ways, buddy, and if we want a fair society to pitch in to provide the opportunities forrer people, we ought to make sure that we have a fair tax structure and that whole redistribution argument is totally baloney when you think of what mitt romney and paul ryan's plans have in store for the people in the middle-class. >> and notwithstanding mitt romney's propensity for gaffes which are clear and present, why should any leader in america be re-elected when unemployment is

over 8%? >> because the trajectory is right. we have had over two years of every consecutive months of job creation and when you look at the party that is obstructing the effort to create further jobs and a party who every single one of them have signed pledges not to compromise with the president, you have to look and point the finger at who is causing the blockage that the president has the american jobs act to create 1 million jobs sitting in congress for one year, because the republicans absolutely refuse to create jobs in a way in the past they have absolutely voted in favor of. the same kind of tax credit and why wouldn't you want to stop the offshoring of jobs by rewarding businesses that ship jobs overshores through tax breaks for them, and why would you not want to stop that? they do not want to give the president a win, and that is the story that the president needs to continue to tell. he has created jobs in spite of

the congress. and i hope that the president will get a working majority to get the jobs bill passed. >> jennifer granholm, glad to have you on the show. >> hey, we want you on the my show, "the war room." >> well, if you don't shout at me like the cop vengs. >> okay. that would be great. >> see you soon. >> very good. >> >> breaking news on the middle east of a killing of an ambassador chrisste stevens in libya.

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breaking news news tonight on the attack in benghazi that killed ambassador chris stevens and three other americans. it was a terrorist attack but it wasn't planned. was the ambassador on a hit list? joining us is fran townsend a cia contributor from the security council advisory. fran, what do we know about this? there are two strands to the story that are breaking today. one was that he feared he was on an al qaeda hit list and that the ring leader for the attack may have been somebody at guantanamo bay and release bad tok l -- released back to america, and what do we know about these things? >> let's start with with the guantanamo detainee. i have not seen it, but in

reports, the man who is the leaders of the splinter al sharia who is related to the islamic el mag reshgseb and as you pointed out that the center of the islamic center said it was a terrorist attack, and if you look at the top of the terrorist leader list, he would be at the top. >> where does this leave us going forward? >> well, no question that given when i was in libya and tripoli and met with ambassador stevens he acknowledged to me in a long conversation that in fact there was an increase of extremism in libya and he encouraged me to go

the benghazi to see that the situation was getting more concerning. i noticed in tripoli the rise of militias even in the center of tripoli, and the ambassador, himself, was traveling and very familiar with benghazi and with the rebels having been there before with the fall of the khadafy government, and he was in a good position to understand the threat and express real concern about it. >> are you thinking that from what you are hearing that he was properly protected or more should have been done there? >> it is hard to say. i would say that i was surprised with when he arrived that we had breakfast on august 9th at the corinth ya hotel, and he arrived in what appeared to be an armored car with no security, but he, again, was comfortable and believed to have been talking to people. it would not have been his style to have a big security

footprint, but the problem is that he, himself, an ambassador in that position a national asset, and this is particularly true of chris, because he was incredibly brey aave and capabld it seems that we should have wanted to protect him the best we could sierra nevada a gotten the job done. >> thank you, fran townsend. mitt romney's campaign is in damage control. joining me now is larry kudlow, and chris, welcome to you both. what do you make of that? >> well, while there is a lot of uncertainty about who killed ambassador stephens, it is no doubt that al qaeda and islam islam islamic magreb is something that is in algeria, and that al qaeda

affiliate is very much on the march. now, you know, trying to gain strength in libya. >> why are a lot of the guys fighting in iraq? what is the migration about, fighting with al qaeda and then off shoot groups to move into libya? >> well, it is much more true in al qaeda than miz law mick -- than islamic megrab?

>> why are a lot of people guys fighting in iraq, didn't they wind up moving into libya? >> that was more a west african organization. >> is al al qaeda still run by a central force? >> they get penetrated and who ever is playing that switchboard operator gets hit by a drone. it is a collection of affiliates that share a passion for violence and it is not as if they are sharing resources or anything. that is what they are getting right now. >> one last point on this. given what is happening in the mid east. clearly, a fundamentalist sees in the past, how dangerous is this right now? across the middle east. you are seeing this if al qaeda is still operating with these cells? >> i don't -- i think that this goes in a kind of sign wave and i believe there are rough moments ahead, but i don't believe that the embassy in cairo is going to be taken the way that our embassy in teheran was. i covered indonesia, and the fall of indonesia and that was incredibly messy for years and you look at eastern europe likewise and romania is a mess after all of these years and after democracy came slow in 1989. i believe that the middle east is going to be very messy for a long time to come.

and libya is going to be messy. i worry more about egypt actually than libya. but it will be, i don't think it will go over a cliff. >> let's talking about the economy. larry, give me a good defense of mitt romney's claim if you take out all of the rhetoric and take out all of the gaffe element of the rhetoric and you cut to his principle point that he claims that he's been making a lot on the stump, which is that, you know a lot of people in america, mainly the ones who vote for barack obama don't pay much tax, and income tax, and are basically living off of government handoffs? >> well, that particular argument is not one that i would have made to tell you the truth. >> is he accurate? >> well, no, i don't think it is accurate. i think that the 47% or 49% of households that are getting government benefits is accurate. that is a good number. once you get beyond that, the issue that nobody pays or half

of the people pay income tax is ta statistically true, but misleading, because so many people take the payroll taxes. i haven't taking any sides here, so i am just giving you the facts. the idea of taking taxes from the voting taxing is not a smart idea and i don't know why a smart guy like romney made it. retirees will vote heavily for mitt romney, but they don't pay income taxes, and veteran groups the same way. and the whole group of nonincome taxes, the middle class people, and take middle-class people who might be earning $50,000 or $60,000 a year, and they get a child tax credit and say three or four kids and they get a child tax credit which might take their income tax liability right away. and they might go for romney, but i would not write them out. one of my friends said that all

he is saying that half of the people are going to vote for him and half of the country is going to vote for obama and then small percentage across the ten states are going to decide the states, and if that is the point, then he should have said that. >> well, it lent power to those who believe there are two of him where he has fund-raising guy who wants their money, and a different guy in public who says a different thing and you add that to the flip-flopping on all sorts of stuff like abortion and so on, you get a sort of reputation building up of a guy with no real political principles. >> i mean, if at the end of the day he was essentially complaining about people feeling like victims even as they have abused the tax code and that is how he comes across himself, and here is a guy who, well, the average, about 60% of americans when all of the taxes are paid,

state, local and federal pay a quarter more of the income in taxes. one quarter. meanwhile, romney may pay less than that, because of ben it ef for carried interest and so forth, and people feeling sorry for themselves as they are taking advantage of to tax breaks, it comes across as insulting. >> i want to make it counter, and i want to make a counter point on that. >> larry, hold the counter point, and keep the viewers on tender hooks so we can come back to get your counterpoint, and talk about obama's appearance on letterman where he seems to forget what the debt was. ♪ [ male announcer ] introducing a reason to look twice. the entirely new lexus es and the first-ever es hybrid. this is the pursuit of perfection.

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what is also true is that we are going to need to ask folks like you and me to do more. and if you and i are in the same tax rates that we did under bill clinton, then that helps to close the deficit. if we do those two things, then

we can manage very effectively and get our books in order. >> do you remember what that number was? was it $10 trillion? >> i don't remember what the nu number was precisely. >> president obama precisely on david letterman and how big of a mistake was that? >> kelsie grammer was due to be on by now, but he appears to have left the building. he has exited stage left, so we have half an hour left. he may or may not come back. we shall see, but for now, i can't think of two finer stand-ins to continue than you two, larry kudlow and bill christoph on cnn right now. >> it is a pleasure to meet nick and i have read him for many years and we have a difference of opinions, but we will get to them. >> well, let's get to them.

>> what was the counter point? >> i want to say a couple of things on the romney stuff. >> the number of households that our government dependant has sprouted in the last 25 years. i think that is an unhealthy sign of the economy. i think people hearing that won't like it either. in other words, as inartfully as romney made the case, people are hearing that we are more government dependent will not like that which opens a door for mitt romney if he walks through it, and we will see. the door is that pmr. obama, yo are for a government entitlement state which is how he puts it sometimes and i on the other hand am for a free enterprise open society, and think they romney's argument is fundamentally more popular in this country than mr. obama's bigger government dependency

argument, the question and the mystery for the romney campaign is why he does not stay on that message. he did in the primaries and then all of the sudden, it went away. >> it is like one of your old am radios where you are listening as a kid and you tie the copper wire to your radiator. the sound comes in and out. his message comes in add out. if you want to sell it, it is about repetition. >> i agree. >> he does not get that done. >> well, the problem is that he keeps putting his own foot in his mouth. you did a brilliant thing on twitter called #romneyencore. there is an interesting point there. this should be a very, very easy gig for a republican nominee to take on an incumbent democrat president.

you've got unemployment over 8%, gas prices have doubled, people out of work, helpless and furious and dissatisfied with all sorts of things in this country, and yet at the moment, obama is beginning to stretch a lead as if everything is hunky-dory, and the reason has to be mitt romney, doesn't it? >> yes, he needs to hire a management consultant firm bain to help the campaign. >> why is he proving to be right now anyway so haphazard? >> i think part of it is that he spent six years now effectively in a republican primary bubble talking to people where everybody sort of thinks that the 47% is this group in america and there are names that go around that say he wasn't ready. and on foreign affairs he stepped nit, because he has not thought about foreign affairs

the way he has domestic. >> and there he is saying that he can't remember the national debt or the exact figure -- >> well, obama should have said $1 $11 trillion and change and it has gone up to $16 trillion and change. >> why does he not want to say that perhaps? >> perhaps he does not like the number numbers, because they are very big numbers. he is being blamed -- >> isn't that the truth. >> -- for a 5.5% increase in the national debt. bill clinton at the convention who gave a great speech tried to bail obama out on the debt, but obama didn't take clinton's advice. i want to slow you down a little bit. you cited polls showing movement for obama, but if you look at the other polls and gallup's overnight poll of likely voters and rathman's, and these guys are neck and neck, and they are running neck and neck in the battleground states. >> are you surprised that romney is not ahead?

i am surprised that only one incumbent president in history has been re-elected with this type of unemployment, and that was fdr. >> well, literally i worked for reagan in the first term. i was not in the campaign, but i worked for him. and reagan was losing to carter right up to the middle of october. and eight points behind in october, and things switched in the debates. i have a sense and you may disagree or not, but because neither of these guys have run really good campaigns, okay, obama very negative and making his own errors and now they have this redistribution tape, and i'm a redistributionist, and romney making the mistakes we talk about tonight, i think that the debates could be very important and we may not know how the thing is going to flip until the end. >> i think it is crucial. on the redistribution thing. >> yes. >> what is redistribution and why is that a dirty word? >> i mean, i don't see why it should be. i mean, after all in eisenhower

years we had a federal margin income tax of 91% and 92%. and that is obviously for redistribution and social security system is in part about redistribution if you have a death. and i think that also that quote from obama's speech has been somewhat unfair that he goes on the say that he'd favor redistribution to create opportunity. and that's a key phrase. it is different from the carving out somebody and saying more if he talked about the public schools in that speech and this kind of things so people are leery about the idea of robinhood kind of approaches and kind of creating or more starting lines, and more schools for early childhood education for more opportunity, and there is more sympathy for that approach. >> we disagree on some of this, but right now given the lousy economy, and this economy is growing at 2% roughly, and it is the worst recovery in post war history, and the oddly enough,

if you go back 10 or 12 years, we have been growing at about 2%, which is way below what america should do. look, i'm an old reagan guy. i say put some more freedom into the e kconomies and let the innovators and the entrepreneurs in more interested in starting up a business and caring for such as manufacturing and energy sector coming along and keep the regulators at bay for a while and don't talk about raising the tax rates for a while. we can solve the longer term issues, but right now, the thing that solves the debt and the thing that solves the unemployment and the thing that helps the inequality is not there and that is economic growth. that is the biggest problem this country has, and we should be growing now after a deep recession closer to 5% than 2%. and to me, still at the end of the day, that's what this election is going to be about. >> i have to leave it there. final word, nick? >> well, let me push back on the notion that taxes make the

difference in growth. push cut t bush cut taxes and slow growth, and so it is more complicate ed that than. >> and bush did well with the tax cuts in mid-200s, but marginal tax rates do impact the marginal decisions and the economic decision, and frankly on the issue of redistribution federal spending affects decisions. because a businessman looks at a big deficit like $1 trillion and businesswoman, and you know what they see down the road? more government and more taxes to finance it. that is one of the big problems here. that is why the obama program with its spending and deficit has really backfired on it. people say, you know what, we are going bankrupt and i don't really feel like making an investment for 20 or 30 years if this country is going bankrupt. >> larry, i have to cut you off in the prime. i rather like this pairing unusual as it may have been and longer than intend ed, i thank

you both very long this evening. thank you. kelsey grammar has not come back, but we have 20 minutes. tension mounts. coming up a tv star finds herself in the middle of a real life drama and the custody battle that sent a woman's children to france, and now alan dershowitz is stepping in to defend the children's rights. ♪ you give it bold new styling, unsurpassed luxury and nearly 1,000 improvements. introducing the redesigned 2013 glk. see your authorized mercedes-benz dealer for exceptional offers through mercedes-benz financial services.

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kelly rutherford starred in "gossip girls" and now in tv dramas, but now she is in a real life drama that turned into a nightmare. her children were born in america and now they are in france due to a judge's decision. kelly rutherford is joining me now. kelly, let me start with you. in simple terms what happened here with you and your ex-husband? >> um, he got kicked out of the country and. >> his visa was revoked? >> yes, exactly. and yet there is no justification for it we don't know why. we keep trying to figure it out. and i keep coming up with no answers from the judge. he is not required to show anything.

he asked that the kids come live with him in france even though we have no connection to france. >> he is german? >> yes. >> did you go to france to visit the children? >> yes. i went to visit them. and then you discovered that they were are not coming back. there is a court order that came out, and they will not be coming back from france. because he can't come from america, and therefore he can't come back to america so they will stay there. therefore the french judge decided this? >> the california judge said this. the concern is that france will now have jurisdiction. >> how do you feel about this? >> i'm beside myself. i didn't think anything like this would be possible. >> alan dershowitz how is this possible? >> i have long been interested in the rights of children in contested divorce cases and often children are the ones who are not represented and the

interest of the children are neglected as parents fight among themselves, and in 1960 and 70s i litigated the rights of children taken away from them because their mother was lesbian. in 1980s i was involved in a case of a russian boy who wanted to stay in america and his parents were compelled to go back. and in the elan gonzalez case, i expressed the rights of the child be represented and this case, it is typical of that. these are american children born in america, and they are american citizens who have been deported without any determination that really it is in their best interest not to be americans, and not to go to the schools in which they were enrolled and not the remain with their friends and not the remain with their mother, in order to sa satisfy a father who obviously as result of some part of his fault has been deported. the obvious solution is to keep the children with the mother in

america and arrange for once a month the mother to bring the children to canada or to the caribbean where the children could visit with them which would be much less destructive to the children's lives rather than take them out of the country where they have been raised and to put them in a country where they have not been raised and to put them in a country where they will be raised as french children. >> but this is not a french decision. it is an american judge. >> it is an american judge, a woman who decided that it would be best for everybody if the children were moved out of this country. it makes absolutely no sense from any logical point of view from the best interest of the children. i think that the children have the right to be represented and have their interests defended, and kids have the right to make sure they are brought up in the country in which they were born and not to be thrown around like footballs, like political footballs and i am afraid that

the children's interests have been negligented in this case. >> kelly, how are the children? do you have daily contact with them and skype them or what do you do? >> yes, this morning i set my alarm at 1:00 a.m. when they were leaving for school in france and i skype with them every afternoon. >> do they know what is going on? >> they have an idea, but they don't really. they say, look, mommy is going to be there as much as possible and mama will figure this out with your father, and know that i love you and i will be there as much as i can. >> how old are they now? >> 3 and 5. >> your ex-husband and what kind of relationship had you had with him up to this point in terms of obviously separated, but were you talking to each other or amicable at all? >> not so much. it was, i feel like once we separated it was then just about, you know, really about him. the children being arguing over who gets the most time with the

children. a lot of that happens in divorce, but this one in particular was kind of odd, because, basically, he was seeing the kids a lot until the visa got revoked and then all of the sudden, it was about getting themt of the country. >> have you tried to appeal to him and his humanity of this? >> of course. constantly. >> what does he say? >> he says no, we are going through the court system and he does not want to talk about it. he just wants to go through the courts. >> i don't know, but the crucial thing now is what can you do about this? you are one of the best of what you do in the world, and what is the next legal step that you can take on kelly's behalf? >> well, we have to find a very good established lawyer who emphasizes the rights of children to find the right vehicle h whethwhether it is a court lawsuit protecting the interests of children as american citizens or appeal in

the california courts, and all of the options have to be considered, but from my pointf view at least the focus has to shift from the rights of the parents to the rights of the children. and they have to be represented fully by somebody whose only job is to protect their interests and make sure that their rights as american interests are fully vindicated and protected. >> well, i wish you all of the best wit. i am so sorry, because i am the father of four myself, and i can't imagine anything worse. we have a statement from your ex-husband's attorney who says that my client continues not to comment in order to protect the children. i wish you all of the very best with this, because it seems absolutely ridiculous case to put it mildly, and incredibly wounding and hurtful to you. >> yeah, it has been. it has been very challenging and thank you so much for having me on and alan on. it really helped.

>> thank you. and best of luck, alan, with the legal campaign. >> thank you so much. when we come back, only in america. this extraordinary love story made in the usa and told in just 22 pictures. americans believe they should be in charge of their own future. how they'll live tomorrow. for more than 116 years, ameriprise financial has worked for their clients' futures. helping millions of americans retire on their terms. when they want. where they want. doing what they want. ameriprise. the strength of a leader in retirement planning.

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