the family slack. >> the result is not good for people running for office. >> that is absolutely true. >> how does boxer look in california? >> if jerry brown and barbara boxer win in california, it will be the ultimate revenge of pete wilson, the republican governor who, in 1994, pushed proposition 187, anti-immigration proposal, and alienated in perpetuity the growing latino vote in that state. ronald reagan got the latino vote in california. >> given all of that, it is amazing how close that race is, particularly because of the history that mark just talked about. and, as nina said, how close is an connecticut. for all these peccadillos and wonderful quirky stories and

debates all of the country, and for all the money thrown in, this really an ideological election. this is a wave election, and it is about what the congress and democrats has hundred don -- what congress under democrats has died. here is what they could have done -- tax reform. you would of had left and right support. or tort reform. there are a lot of other issues were you could have had a consensus answer. at obama himself -- the story in "the times" on sunday says he wishes he could have inc. tax cuts in the stimulus to bring republicans in -- you would have had three issues on which you would have had a national consensus and you would not have had the tsunami you have now. >> this is not going to be a republican victory in the sense that it will beef up the republican party. independence, who voted heavily for obama in 2008, are now

voting for republicans but it does not mean that they are republicans. it means they are against democrats. >> this is not an ideological election, it is an anchor election. you see that in republican primaries. the democrats are angry at everybody. >> in just about every case -- if you are a republican, to solve, if you are a democrat, because he supported the president. >> republicans oppose things they were for historically -- the individual mandates -- john chafee and bob dole on health insurance -- tax cuts to small business, they oppose it -- cutting federal spending, they oppose it. >> just when you think they could not have a follow up the

mortgage situation any worse, something surprises you. >> a trustee for a trust, but that was not for the bank i had my note with and my mortgage. when i found that out, i went to my attorney and we spoke about it and we filed a motion to dismiss the case. >> all clear on that? the outrage against bank of america and jpmorgan chase, talking about fake social security and forged documents, mortgages sliced and diced so many ways you cannot tell who owns them, and class-action lawyers and state's attorney general filing lawsuits -- i don't know why people have so little confidence. >> we thought we were rescued in 2008, 2000 and, by tarp and all that. -- 2008, 2009, by tarp and all that. there is the suggestion here that we are not, we could have

another financial crisis, and the banks that are dead center at all of this have all of this bad paper, and they will not be able to lend any money and we could have another financial crisis, maybe not on the scale of 2008, but enough to give a sharper and told to a shaky economy. -- sharp jolt to a shaky economy. >> they will not get another rescue. they're getting millions in bonuses. i don't understand why, because they do not lend, but they are. nobody feels sorry for them. they it didn't just desserts, they screwed it up -- they are getting just desserts. they screwed it up once, they are screwing up twice. people don't understand -- >> want to say something nice about the banks, charles? >> this is not a story about the banks. the most wonderful story is the

political story. immediately after this erupted, five democratic senators immediately called for a moratorium on foreclosures. the white house immediately reacted by saying, "no." the reason is that they understand that if you do that, it sounds wonderful, sweetness and light, you will save all the people. if you impose a moratorium right now, you will have a financial guide test a free -- if i took catastrophe did you seize up the housing market, -- such as it if i -- and ecocatastrophe --. a financial catastrophe. you will seize up the housing market, such as it is. the white house is careful. it would destroy the system all over again. >> look at the facts. illegal on the part of the banks, signing off on documents they never read.

why? because of the rabbit, a feverish pursuit of profit -- rabid, feverish pursuit of profit. it took their mortgage payments one month later to an institution they never heard of, and months later, a different institution. they were securitized and these mortgages in eight gold rush. and now we're supposed to say, look at these folks who hire people at minimum wage to robo ostamp papers -- >> what do we do about it? >> we cannot reward in any way this kind of behavior. >> they are so central to our existence that if we really punish them, we are back in the suit. -- in the soup? >> so we should just say, "fellows, you did a helluva job"? >> if people could not do the modification, they would lose the house. >> the latest chapter in the

"don't ask, don't tell" wars. >> i am absolutely thrilled. all i want to do is go and do my job. >> that is an air force major, a decorated flight nurse recently ordered reinstated by a federal judge in washington state. she was discharged for being gay. the judge put a halt on all the investigations of service members. that is that the end of it, is it? -- not the end of it, is it? >> the federal government has an obligation to defend the laws of the land even if they feel it is unconstitutional. that is what obama is doing, trying to get it changed through congress. by the time this goes through the courts, it may not stand. that is the hammer hanging over congress' head. but it is going to be messy. >> secretary of defense bob gates has been emphatic about

this. there is a process going on. he wanted to continue. the question is, 150,000 military personnel active in reserve. they have 50,000 questionnaires back, questions about benefits for partners and survivors and so forth. you talk to military people off the record, and they say they are worried about recruitment. i think the legislative process is necessary, for it to go through the political process of congress. >> i do, too, but that is the problem. congress is so stock. -- stuck. i am not sure right they are going to ok this. -- sure they are going to ok this. >> the president is right, and he ought to be commended for acting on principle here. we do things in this country, often slowly, but in the end, it

usually ends up right. if you short circuit, as with abortion, and you do it as a judicial act, you end up with 20 or 30 years of unnecessary strike. i am sympathetic on this issue, but i think you should do it the right way, and that is through congress. >> last word. see you next week. for a transcript of this broadcast, log on to insidewashington.tv.

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