>> production assistance for "inside washington" was provided by allbritton communications and "politico," reporting on the legislative, executive, and political arena. >> how did you become so wealthy on the government payroll? >> this kind of a low blow. >> this week on "inside washington," democrats prepare for the worst as the white house unleashes its most powerful weapon. the 2010 debates, political discourse at its most elevated above all. -- elevated level. the lincoln-douglas debates they are not. >> you're just jealous you were not on "saturday night live."

>> the latest chapter in the housing crisis, screwed up foreclosures. and a federal judge in california orders a halt to "don't ask, don't tell," but that is not the last word. >> this policy will end on my watch, but i have an obligation to make sure we are following some of the rules. captioned by the national captioning institute --www.ncicap.org-- >> the word you hear repeatedly around this town from the political soothsayers with regards to november 2 is bloodbath, as in democratic bloodbath. how bad is it? the white house has dispatched the democrats'most powerful spokesperson to help candidates in several states. >> we have come too far to stop putting the american dream that i know, that my husband knows, that russ knows, back within

reach for all of us. we have come too far. >> that is michelle obama, trying to throw a lifeline to struggling russ feingold. kenji save them, mark -- and she save them, mark? >> he will save himself. michelle obama, the lightning rod, the controversial figure in the campaign of 2008, has emerged as the more popular. she can go to colorado. the president has not been, to my knowledge, invited back to colorado since he helped michael bennet win the primary. she can go where he cannot, and her numbers are hot. as far as delivering votes, we don't deliver votes in this country, we don't deliver groceries, we barely deliver mail. >> se67 percent approval rating, michelle obama. does putting her out there put in jeopardy, nina?

>> i don't think so. she is an incredibly graceful circuit -- graceful sordid who can only help a candidate. she cannot elect a candidate and more than any president really likes the candidate, but she can help -- then the president elect the candidate, but she can help. >> how does a look to you, evan? >> obama's approval rating is not that bad compared to progress. -- compared to congress. but there is nothing positive he can do. mostly he is just a bystander at all of this. >> a bystander, charles. >> in a country wracked by anxiety over the dead wrestler issue, it is good to see -- as for michelle obama, she will not make an iota of difference in

these races. her husband is toxic in most of these races. as for wisconsin, russ feingold is one of the most principled members of our political class in 30 years. of all the democrats to mention obamacare, almost all of them are running advertisements against it. he is standing up and defending it, knowing how popular it is. i salute him. he is behind and looks like he is not going to make it. >> they have the first lady at the because the new republicans will show up and democrats, especially young ones, might stay home. the president was speaking to students at george washington, and did a live town hall on mtv, bet, and the internet. >> healthcare passed and i am proud of the fact that a lot of the people here will benefit directly.

i'm pretty confident that if we work together over the next several years, the political temperature will go down, the political rhetoric will go down, because we will actually be making progress on a lot of these issues. >> is he going to be able to get the end people out there to vote? >> no, the surge in the 2008 election was three basic groups, african-american voters, college towns, first- time voters. you are not going to recreate -- you cannot get that souffle to rise again. but republicans have targeted and are harvesting older voters. republicans run advertisements talking about defending at stopping the cuts in medicare. >> and older voters have just learned that for the second year in a row, the cost of living increase will not be applied to social security. >> there is no cost-of-living

increase, which is why you are not getting the money. nothing has been taken away from them. >> but you tell that to them. >> it is like 1%. >> that is why i am not running for office. >> there is no something for nothing. what has struck me about this campaign, and i have talked to a bunch of members of congress -- i am not sure why people run continually. i talked to a bunch of numbers who are kind of frightened by the ugliness and the nastiness and allies. >> i think it has been a splendid campaign -- [laughter] at election they will be more splendid. the news of the week is not what we saw in that clip is what he says in "the new york times magazine" coming out on sunday. he tells peter baker that he has

just realized that there is no such thing as a shovel-ready project. that will come as a surprise to americans who invested $1 trillion in projects he told us over and over and over again or shovel-ready. quite an admission. if you are a democrat who supported the stimulus, you are way out on a limb, and the sound of the saw is coming from the white house. >> house republicans go off that -- could house republicans go off at limb? >> the conventional wisdom is that the house is going to go republican. to charles' point, the trick of the modern president is to rise out of the muck that is so deep. how does the president get noticed? how could the president not be noticed? he has the biggest bully pulpit in the world. but somehow obama has managed to make himself not irrelevant, but

he has done to solve it his presidency and figure out a way to make people actually listen -- he has got to salvage his presidency and figure out what to make people actually listen to him. >> he may have done too much media -- >> that may be, but he is not getting himself listened to. >> he looks tired and mad. you cannot do that when you are president. you have to let the energy that reagan and clinton -- >> the problem is that he looks a little tired and a little mad. >> the way of rising out of the mike is to accuse the chamber of commerce of secretly using foreign money without a shred of evidence so that even "the new york times" points out in a news story that there is no evidence for any of that. >> let's talk about that. let's examine some of the elegant rhetoric of the campaign as the president tries to rise out of the mock. >> what opinions of late that

have come from the high court to you most object to? >> oh, gosh, give me a specific one. i'm sorry. >> i cannot, because i need to know which ones you refer to. >> i'm very sorry. i note there are a lot. i will put it on my website, i promise you. >> that is christine o'donnell, running for senate in delaware. there is the controversy and the california governor's race over the use of the word "whore," there is the candidate in ohio who dresses up as a nazi and accuses his opponent of character assassination by bringing about -- [laughter] >> it was a re-enactment. he was not driving a mercedes and carrying a gun. i never defended a nazi before, actually. [laughter] >> i knew the first nazi that

charleston that it would be a republican candidate -- that charles defend it would be a republican candidate. [laughter] >> as harry reid would say, that was a low blow. >> how about the debates? does anybody have an favre? > -- favorite? >> i would be the california gubernatorial debate. christine whitman, who cannot stop smiling -- >> midwood min. -- meg whitman. >> meg whitman, who cannot stop smiling, and jerry brown, who has forgotten how to smile. i think the fact that we had a limit -- >> politics has become a freak show. if you go into politics, you have got to know that you will be a clown, he will be subjected

to ridicule. whatever you do in the back, whatever little fly on you, will be magnified by 20. david brooks has an interesting column on this guy kirk, who exaggerated his record, but he is getting absolutely killed for it. why even bother to go into politics? >> what is your favorite candidate? i know who years is, carl paladino. >> he got into a a shouting match with the report or he says something like "i will run you out -- rub you out --" >> take you out. >> then he got into something on homosexuality with the hasidic rabbis. he spent three days apologizing, and then the rabbi repudiated

him. you cannot make this stuff up. >> he is howard beale -- "i am mad as hell --" >> the outside, unreported, an accountable body, is nine-one republican -- unaccountable money is nine-one republican. the lid of fact, -- politifact, which is analyzed these ads run by we don't know who, say that 80% of those advertisements are basically false. they may have a kernel of truth in them, but they're basically false. when you see somebody say, "i am a gordon peterson i paid for this ad, close to oppose a basically true.

-- "i am gordon peterson and i paid for this ad," those are basically true. >> what about the attack on the chamber of commerce with foreign money? >> they made it up, the white house. the real story is billions of dollars and lack of accountability and transparency. you do not know who is giving it and why they're giving it and who is behind it did take the case of the two-term democratic congressman in iowa, and a group called the american future fund spends $800,000 against him. he is pretty resourceful. the charges come again, have been false against him. all you need is one of these guys, one member of congress going down with an outside group spending $1 million and it would send paralysis of fear

throughout congress. nobody in the next congress will do anything except raise money in anticipation of an outside group, against them, and it will play a big part and not let let anyone that wants to repeal the estate tax -- >> according to my calendar, the money is just pouring in. >> it is hard to imagine progress being more paralyzed than it already is. -- imagine congress being more perilous than it already is. >> they did stop. they passed health reform and financial institution reform. it is a big accomplishment. so these are big accomplishments and there are big interests that don't like them. big financial interests that don't like them. >> it is really hard to require sacrifices in making tough votes. >> what you are missing is these

major accomplishments, and they were -- health care reform is a historic accomplishment. i think it is a mistake, but it is a historic accomplishment these major accomplishments, health care reform, stimulus, cap-and-trade, is what has stirred this resentment, anger, and pushback. that is what the election is about. >> you think that is true? >> it is exactly over what the administration and congress have done. if you are going to do something, you do something other than obamacare, other than $1 to clean up stiglitz, shovel-ready products and that an ounce a year and half -- $1 trillion of that stimulus, shovel-ready projects and then announce a year-and-a-half later that there are nine. >> let's go back to the dead wrestler. there is questions of and a list

and bite mr. richard blum -- on top questions of embellishment by mr. richard blumenthal as well. >> he abolished his record on vietnam. he served only state side. but he seems to overcome that and put the focus on non- prescription pharmaceuticals and world wrestling association. and his appointed's association with that institution. -- his opponent's association with that institution. >> he should not be in any trouble at all. he was a congenital forever, hugely successful. -- he was attorney general forever, hugely successful. the fact that he is in trouble is a sign of how in trouble the democrats are. >> this is a recurring theme here in election after election. it is not a cardinal sin to have done this. it seems to me that a guy like him, really does have a long

record of public service -- yes, it was stupid and at what he did. he should not have done that. but it should not have canceled out all the other things they have done in their careers. i think the politicians ought to be cut some -- >> nobody gives the politicians any slack at all. they give their kids flat and 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.