this sunday, the countdown to november 2nd, election day. the president is on the trail trying to protect home turf, stumping for the democrat vying for his old senate seat. >> can you trust him. you can count on him. >> as the gop threatens to change the balance of power in washington, the fight for the illinois senate seat is still too close to call. this morning, we kick off our election year senate debate series with the showdown between the democrat, illinois state treasurer alexi giannoulias and the republican, congressman mark kirk. the big issues, jobs, spending and taxes and the credibility questions dogging both candidates, making this an intensely negative campaign. then our political roundtable on the bigger picture. how new jobless numbers affect

the campaign, whether democrats can make the election a closer contest than most expect. and another high-level departure from the white house. with us, "time" magazine columnist joe klein and "the wall street journal's" peggy noonan. good morning. good morning. with only 23 days to go, the campaign team of president obama and vice president biden heads to philadelphia today to try to rally democrats to turn out for pennsylvania senate candidate joe sestak. here in washington, this morning, it's all eyes on the tight battle in illinois. >> hello, chicago! it's good to be home. >> the fight is personal for the president. >> in some very tough circumstances, in a tough political season, he has not

wavered. and that's the kind of person that you want. that's the kind of person that you know when the going gets tough in washington, will be fighting for you. >> democratic state treasurer alexi giannoulias, neck and neck with five-term republican congressman, mark kirk, battling for perhaps the most famous senate seat up for grabs in this mid-term race, president obama's former seat. for the gop, it's the ultimate prize. >> the fact of the matter is, if democrats hold the majority, it will be because they held the president's senate seat. if they lose the majority, it means one of the seats they lost is the president's senate seat. that's the ultimate repudiation if you're a former illinois senator now sitting in the oval office. >> it is also a race that was marred by scandal from the start. when president obama left one end of pennsylvania avenue for the other, then governor rod

blagojevich ignored objections from democratic leaders and appointed a former state attorney general, roland burris to the seat. blagojevich was later arrested, charged with trying to sell the president's old senate seat. then, the campaigning began and the scandals continued. >> the navy named him -- >> kirk, a naval reserve has erroneous or exaggerated claims on his record. including service in the gulf war and invasion of iraq. and giannoulias, a 44-year-old former basketball star who played professionally in greece, has been plagued with his family's troubled bank and

whether giannoulias, at the time a senior loan officer with the bank, was aware of $20 million in loans to a pair of chicago criminals. >> if all you're looking at is the negative side, you have a choice between a serial embellisher and a mob banker. >> how will illinois voters decide and what will the outcome say about this mid-term campaign? joining me now, republican congressman mark kirk and illinois state treasurer democrat alexi giannoulias. welcome, both of you, to our studio and to this debate, "meet the press" style. so there are no set rules. we're sitting around this table.

we're going to have a conversation and go through the issues and there's a lot to get to, so, let's get to it. i don't have to tell you both the specter of president obama hangs over this race because indeed it was his senate seat that you are now vying for. it was on election day, 2004, in chicago, when the president and his family appeared and he was then the president-elect, this is what he said. >> it's been a long time coming, but tonight, because of what we did on this day, in this election, at this defining moment, change has come to america. >> mr. giannoulias, let's start with you. how would you define the change that has come to america under president barack obama? >> i think it's important to put things in context. if you look at the mess that he inherited and the enormous challenges that he inherited, a $1 trillion deficit, increasing job losses, i think he has done everything he can to help turn this economy around. the question is going forward, what more can we do? we focused our campaign on creating private sector jobs. we talked about infrastructure. we talked about moving forward with the next generation of clean energy jobs, tax breaks to small businesses, job creation, tax credit for small business, payroll tax holiday for low to moderate income workers, doing everything we can to get that $1.5 trillion that's, quite frankly, sitting on the sidelines of the private sector, encouraging and promoting -- >> the country is better off in this economic recession be of the change that president obama brought? >> i think if you look at what would have happened if some of the measures weren't taken -- again, they weren't perfect. for example, when you look at t.a.r.p., the bailout to the biggest banks, that congressman kirk voted for, i would like to have seen, as a former community banker, more oversight, more account jacket, requirements that these banks lend money to help increase to capital. something we've done in the state treasurer's office.

i think that was a missed opportunity. >> you and the senator rallied back in march, gop rally, about the president, we are on the way to making this guy a one-termer. how do you answer that question? how do you define the change he has brought to america? >> tremendous amount of debt. i have a chart here that shows our debt-to-gdp ratio. while we did run deficits in the past, we now number our debt in trillions rather than in billions. and i think that represents a long-term danger, especially to the american dream. every american born today owes $43,000 to the federal government the day he or she is born. and we are transferring a tremendous amount of debt to the new generation. much of it owed to overseas creditors, who expect to be repaid by our children with interest. >> as a republican, member of congress, do you really want to stand by your party's record on the debt, going back since you came to congress? >> no. i've become very much a fiscal

hawk here. i foreswore earmarks for my own congressional district. we could save $66 billion right there. the kirk amendment passed in the house that attacked the bridge to nowhere, even though it was in a republican district, the chairman of the house transportation committee and now it's actually the bridges to nowhere, will not be built. >> i want to come back to the debt in a minute. i want to talk about the number one issue, i think, which is jobs, on the minds of every american, 9.9% unemployment. look at this chart, a tale of woe in this country. go back to august 2009. since that point, unemployment has been at 9.5% or higher. that's 14 straight months. congressman kirk, i'll start with you. what do you do at this point? as the federal government, to spur private sector job creation? >> first of all, recognize the stimulus has largely failed. the very small part of it even went to infrastructure development problems. it didn't answer the question, what happens when all the borrowed money runs out? secondly, this congress has been very, very viciously anti-business, new taxes, new regulation. we need senators and congressmen that will back up pro-growth

agenda. for example, my small business bill of rights, ten new policies to help out the number one employers in illinois and the united states, small business. half of all the jobs, 80% of the job losses in the great recession. they can't afford a washington lobbyist to go find stimulus money or a washington lawyer to wade through the latest 1,000-page bill that congressional leaders haven't even read. >> tax relief, tax cuts is the job creation? >> pro-growth agenda like making sure we don't pass legislation to take away your right to a secret ballot in a union election. my opponent wants to take that right away called the car check bill. i think that's a terrible idea. >> how do you answer the question to job creation? >> one of the problems is we have typical washington, d.c., politicians who have forgotten what it's like on main street. i'm the only candidate in this race who has worked in the private sector. congressman kirk has been in washington, d.c., for 20 years. if you're thrilled with out-of-control spending, out-of-control borrowing that has become the washington, d.c. ethos, i think congressman kirk is your man.

>> my question is, what do you do to create private sector jobs to put people back to work? what you've just said doesn't put people back to work. that's what people are wondering. >> that waive done in the state treasury department, the biggest problems i hear from my friends in the business community is that there's no lending, tough to get a loan. if you have a line of credit, it's being tapped. one of the first things we need to do is increase liquidity and access to capital and that the to make sure $1.8 trillion sitting on the sidelines in the banking system, can be leveraged to $18 trillion. we need to do everything we can to focus on that. we need to focus on green jobs, solar, wind, geothermal. biomass. there are so many opportunities but other countries like china are getting ahead of the curve. >> the government did do a lot with the stimulus, right? you actually said the stimulus was not big enough and you'll lead a progressive caucus if you're the senator from illinois, you've said. will you push the administration, if elected, to enact more stimulus, to spend more money to try to get people back to work? >> if it means more tax cuts to

small businesses, if it means middle-class tax cuts, i'm for it. i will tell you that we also have to keep in mind what the recovery act really did. a third of it was tax cuts to middle-class families, a third of it was emergency funding to states and municipalities, something i've seen as state treasurer. >> do you acknowledge it hasn't done the trick? 14 months of unemployment. they said if you passed stimulus, it would get to 18 -- 8.5%, but it's 9.5% for 14 straight months unemployment. >> the bigger question is what would have happened -- it wasn't flawlessly done. will you need to see souplines down the street. if you take a look at what would have happened -- do we need to see a stop sign down the street to avoid it? that is a reality. >> let me have you engage on the big tax debate. do you think the bush-era tax cuts should be extended for all americans? >> like cnn just did a survey of economists saying that they should not have a new big tax increase on december 31st. if you look what congressional leaders want to do, they want to hit the u.s.

economy with a $900 billion tax increase on december 31st. on top of the ten new taxes that were in the health care bill, on top of the taxes in financial regulation bill, on top of the taxes that were in the august congressional legislation. i don't think -- the key danger here is, will our policies increase the chance of a double-dip recession? if you look at the job numbers just last week, we have a significant danger of that. and taking more money out of the private economy and having the government perform as it has poorly done with the stimulus, i don't think is the right way to go. >> you said just a moment ago, if i heard you right, you are a deficit hawk, fiscal hawk. back in 2004, you were part of this republican main street partnership. and as part of that group, you had a press release on 2004 -- i'm going to put some of it up on the screen. today the republican main street partnership, the largest organization of the moderate elected republicans in the nation offered six principles for the '05 budget resolution designed to put congress on a path toward a balanced budget.

these principles stand for a key value that once we adopt the budget we must have the tools to stick to it, said congressman mark kirk. here is a key part to that. tax cuts should only be extended temporarily and limited to those that are due to expire in 2004. key point. we simply can't afford permanent and across-the-board extinctions at this time. that's what you said then. >> right. >> when the debt was about one-third of what it was today. congressman, how can we afford to make permanent tax extensions now, the bush tax cuts, in this climate? >> especially in this climate, we have congressional leaders who are not interested in spending restraint at all. for example, i back spending restraint across the board. at the d.o.d. like no second engine for the f-35 fighter, closing down joint forces command, across the board reductions. when you look at the state of the economy right now, you have to set a priority. my top priority is the deficit of jobs and economic growth. and especially this perception that the united states could be falling behind, especially asian

economies. if we go through all the tax increases that congressional leaders proposed -- by the way, congress is going to come back right after the election in this lame duck session of congress with a new round of spending in this omnibus appropriations bill and new tax increases. >> should -- the question is, mr. giannoulias, should tax cuts be paid for? >> this is a fundamental policy difference between myself and congressman kirk. he said he's a fiscal hawk. the congressman has told some real whoppers in this campaign but that may be the biggest one of all. he has voted to increase his own pay six times, voted for the bridge to nowhere twice. he voted for a pay increase for himself. the list goes on and on. saying you're a fiscal hawk doesn't necessarily make it true and your voting record proves it's not true. the question for the congressman is the $700 billion in tax cuts for the wealthiest americans, we don't have $700 billion. my question to the congressman is, which country do you plan on

borrowing $700 billion from? the saudis? china? we can't afford it. that's one of the problems, quite frankly, with washington, d.c., this over borrowing, over spending. >> congressman, respond to that. the congressman has said tax cuts don't have to be paid for. republicans have said and the president says there's $700 billion they want to extend. where are they going to get the money? >> spending reductions across the board, cutting out whole programs and making sure we have a new sit of mechanisms. for example, the president has been rumored to bring forward a line item veto proposal. republicans should support that. we should have a new grace commission put forward with base-closing powers to put a joint bill that the house or senate one or up or down vote. it's ironic for my opponent to criticize my record on fiscal conservatism, in front of "the chicago tribune," they asked him name one spending bill you would vote to cut. he couldn't name one. as "the chicago tribune" said when they endorsed me, it was painful to watch. >> speaking of painful, let's pick up on that because i was

going to ask each of you in this circumstance, what is a painful choice you would make to bring the budget into balance? a spending cut that you would make. >> look, this country has not lived within its means for a very long time and we're going to have to take our medicine and and what the deficit committee says is important to answer, your question and this is an area where the congressman and i would agree. i would have voted against the omnibus spending bill, which included earmarks and a lot of pork. this is where the president made a mistake. >> everyone who comes into congress says we'll cut out wasteful spending. an explosion of entitlement spending, social security, medicare and the like. what would you do on some of these big runaway programs? social security, would you look at upping the retirement age in order to cut benefits and save some of that money? >> we'll have to take a look at what the deficit commission says and look at their ideas. i'm personally not in favor of increasing the age limit. i do think that we need to look on the revenue side different

options, increasing the taxable wage base, finding ways to get more revenue, but i'm all for strengthening social security, not diminishing it. >> congressman kirk, if you were serious about cutting the deficit and cutting spending, why don't you stand up beside paul ryan, the congressman who has put forward some pretty draconian cuts like medicare, do you stand with him in those cuts? >> we need a whole range of cuts. >> my question is, do you stand with him and some of his suggested cuts to medicare? >> i have my own cuts which i want to put forward. we should, for example, sell off big parts of the tennessee valley authority, southeastern power administration. consolidate maintenance at the department of defense, a lawsuit reform which would save at least the federal government $54 billion. i could go on and on beyond the f-35 engine and the earmark spending. >> do you go beyond the republican pledge, which is to go back to 2008 discretionary spending levels? >> i think we need a radical reduction in spending because -- >> beyond the 2008 level? >> 2008 is a great start.

>> you do recognize 2008 that's in the pledge isn't nearly enough to deal with the size of this deficit, right? >> one thing that's missing from this whole debate is no effort to put forward pro-growth policies. if the united states launches on a plan, as my opponent's policies would do, on to be a very high-taxed, high-spending, high-regulation economy like many european economies, then we inevitably have the slow growth and high unemployment of those economies. that's not the american way. the american way is a limited government, and lower taxes. and a very robust small business sector, which especially is employing low income and minority kids coming into the american dream. i very much worry right now that if we're embracing a european style, very high debt, very high tax environment, we will suffer all the slow growth policies that they have. >> congressman, you have said that you would lead the charge to repeal health care reform passed by this congress. is that still your position? >> that's right.

when i came back to the united states, i met with the republican leader and said, we have to be the party of better. we can't just be the party of no. we put together the alternative which i introduced into congress. 400 pages. it was not allowed for a debate, discussion or a vote. it did three big things, medical rights act, the congress should make no law that interferes with the decisions you made with your doctor. second, lawsuit reform which was completely skipped and needs to be in there. and third, congress should defend your right to buy health insurance from any state in the union if you find a plan less expensive to cover your family. >> you will try to repeal it? >> let's look at the health care bill we passed. $500 billion in cuts for seniors who depend on medicare. another ten new taxes that hit the economy. and a perverse incentive. what is the essence of health care bill in 30 seconds? it says that if you employ 50 americans or more, you must offer health insurance to the

employees or pay a $2,000 fine. but health insurance in america, many times, costs more than $2,000, giving a perverse incentive for employers in 2014 to drop coverage. >> are you running on health care reform? is that something you will stand by? as passed by the congress? >> i am running on jobs and helping small businesses. the health care bill was far from a perfect vehicle. that being said, it did some important things that the congressman wants to repeal, denial of coverage for pre-existing conditions, making sure that kids in between college and their first job have health care and i think, morally, we shouldn't have 51 million americans without affordable, basic health care. the health care system as we have it right now, we spend over 17% of our gdp on health care. it's bankrupting our families. it's bankrupting small businesses and bankrupting this country. the congressman has the talking points of $500 million in medicare cuts. the truth is a lot of medicare expenditures are fraud, waste and abuse. and what this does is create efficiencies within medicare, which is why the aarp and the ama endorsed it. there's a lot more to be done. i would have loved to have seen

a provision to let the secretary of health and human services negotiate bulk drug rates for medicare the way the v.a. does. there's missed opportunities in the implementation -- >> coverage of preexisting conditions was in our bill. i've traveled to the top health care systems and they'll talk about these cuts as representing between a $30 million and $100 million cuts per hospital across illinois leaving them to cancel expansions. the effects of the cuts of your legislation are already being felt by the illinois health care facilities. >> the difference is, he wants to repeal it, i want to fix it and reform it so it works for businesses and families. >> let me move on to some of the personal aspects of this race. it's been pretty nasty. negative tone by both of you. here was a poll in the chicago tribune, wgn. who do you consider more trustworthy or honest? 35 giannoulias, 30% kirk, 16% neither. can't be a figure either one of you are proud of. i want to go through some of the

issues that have cropped up on both sides and allow you guys to talk through it. mr. giannoulias, back in 2006, you were running for state treasurer. this was part of an ad you put on the air touting your record. >> people out there in illinois need our help. >> alexi giannoulias, financial expert, businessman, banker. >> treasurer's office is a fiscal office. let's get in someone in there to protect people's money. >> your family bank, broadway bank, was seized by regulators and it went under. you released a statement earlier this year creating some distance from the bank and when it was closed. let me put the statement on the screen. it was because my father instilled in his sons the importance of helping others that i decided to leave the bank in 2005. that's the key date here, 2005, to pursue public service. at the time i left, according to every independent analysis, the bank was one of the best performing in illinois. "the chicago tribune" summarized some of the issues at stake here. under this headline, giannoulias

still worked at family's bank in '06. candidate tells voters he left by late 2005. he tells voters he was gone from his troubled family bank by late 2005, but that's not what he told the irs. giannoulias was able to take a $2.7 million tax deduction because he reported working hundreds of hours at broadway bank in 2006. he says there's no contradiction. the issue highlights the fine line that he walked telling exactly what he did and when he did it. a bull's-eye for critics bank's loans for mob figures that contributed to broadway's collapse earlier this year. saying he left in 2005 gives giannoulias maximum distance from the bank's questionable lending practices, the april takeover by federal regulators and other controversies such as a loan by the bank to convicted influence peddler tony rezko. in early 2006. but by reporting that he worked at least 500 hours at broadway in 2006 giannoulias was able to get a break that helped him avoid paying federal income tax in 2009. can you clear this up? which is it? when did you leave and did you get a tax break you shouldn't

have? >> sure, there have been no inconsistencies in anything i've said. i left day-to-day operations in '05 and fully left the bank in 2006, made millions of dollars in taxes over the last five years. this is not what people are talking about, david. when you bring up the bank, my father came to this country as an immigrant, started a community bank 30 years ago. this was not some fly-by-night company. it was his whole life, his legacy and he has helped thousands of people achieve the american dream. because of the devastating recession, we've seen more community banks go under than ever before. another almost thousand community banks are on the watch list and, you know what? while i'm very fortunate and my family is very fortunate, i know what it's like to lose a family business because of this recession. >> let's get to the substantive point. why did you say you left in 2005 but you told the irs you were there working in 2006 in order to get the tax break? >> nothing i said have been inconsistent. i said that left day-to-day operations in 2005. >> but you did work there in 2006? >> as i always said.

nothing is inconsistent and i make my tax returns public, unlike the congressman. everybody can see what i paid in taxes. i make my tax returns public. i paid my state treasurer's salary in taxes and getting a refund because of a widely known business failure and i'm giving that money to charity. >> were you aware of some of the loan activity to criminal figures? >> the way a community bank does business -- i know when you run for office, these stories get sensationalized. when a bank decides who to give a loan to, they look at the creditworthiness of a borrower, they look at the credit score of the borrower, appraisal value of the property. any bank -- of course, there are individuals that we may not want to do business with, but that doesn't represent the thousands of people -- >> my question, mr. giannoulias, were you aware that there were crime figures getting loans from your bank? you were a loan officer there. >> as i continue to mention, as i continue to say, if i knew now what i know -- if i knew then what i know now, these are not the kind of people we do our business with. >> you're saying you didn't know. you didn't know?

that's the easy question. did you know they were crime figure that is your bank was loaning money to? >> we didn't know the extent of that activity. >> but you knew that they were -- >> if you look at any bank, bigger bank, you'll find hundreds of individuals. >> that's not what i'm asking. did you know they were engaged in crime activities that you were loaning to? >> i didn't know the extent -- >> this is what you said, congressman kirk about all of this in ads and to fox news. it appears that the broadway bank, the giannoulias family bank, has ties to the mob, convicted felons. this is a portion of the ad that you're running this with the senate republican committee. >> alexi giannoulias, he'd make tony soprano proud. >> are you saying he has ties to organized crime? >> this is a list of all the bank loans to convicted mobsters and felons. the ones in yellow are the ones where he was the senior officer at the bank.

these are all infamous mob figures and bankers who have very long and storied record. you don't have to pull their rap sheet. it was in "the chicago tribune." >> again, this is the congressman, who's never worked in the private sector. who doesn't know what it takes -- what a bank does when they look at whether or not to approve or deny a loan. he pulls some names and tries to make it a political attack. people aren't buying it. that's why we're up in the polls. this is what's wrong with politics. someone like congressman kirk, who has no idea what it's like in the private sector, to go out there and say these are convicted mobsters. those aren't the kind of people -- >> do you stand by all those ads that -- he's sitting right here. does he have connections to organized crime, in your judgment, or was there bad judgment by the bank? >> the broadway bank provided an extraordinary amount of capital totaling millions of dollars to mob figures and convicted felons after they had been convicted and that's absolutely the -- i was in the private sector. i did work. i'll tell you the private sector experience i don't have.

i don't have experience in loaning money to mob figures. i don't have experience in reckless loans to commercial real estate and brokered hot money deposits leading to a collapse of the bank. "the new york times" analysis of treasurer giannoulias' work of the bank, showed it was his decisions that -- >> that's not true -- >> analysis showed that it was his decision that led to the collapse transferring a $390 million bill. >> i'll give you the final word and we'll take a break. >> we shouldn't be surprised to see the congressman lying again. look at the loans that were past due and the bank was taken over, like thousands of community banks that are dealing with challenges, less than 9% of the loans -- it's a political war, i understand that. for him to characterize my family that way is misleading, it's offensive. people aren't buying it. the congressman wouldn't know the difference because he has been in d.c. for 20 years. >> we'll leave this issue here. we'll take a break. there have been credibility issues that you've raised, about some statements you've made, congressman, during the campaign.

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we continue our debate with the two candidates vying for the senate seat once held by president obama. ise a glass

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we're back to continue our debate with the candidates battling to be the next u.s. senator of illinois for the seat once held by president obama. congressman kirk, there have been issues raised on the campaign trail that has to do with your military record, naval reserve as an intelligence officer, you served in afghanistan, iraq, congressional medal for kosovo service in

1999, all of which makes it curious for some of the exaggerations made during the campaign trail. back in june, i'll put it on the screen, kirk's problems began with the revelation that his claims were false. being named the navy's intelligence officer of the years were false. followed by a long string of other errors and exaggerations, a letter from his office said he served in the gulf war, when he didn't. the first gulf war. he also referred to serving in the invasion of iraq, although his duties kept him stateside. he said his reserve work sometimes includes running the pentagon war room even though he oversees only the intelligence operations. although he had clearly described coming under fire while flying missions over kosovo and iraq, kirk began to hedge and say that he couldn't be sure his plane was targeted by the anti-aircraft fire. and he didn't mention that he rode along on only a handful of flights. perhaps just three. kirk's campaign also denied he had ever improperly mingled political activity with his military duties only to have the pentagon confirm he had done exactly that on two occasions.

you also did an interview at "the chicago sun times" that you had been shot at in kandahar only to have contradicted by something on your own website earlier in the year. my question is, given your own military record, would you would why would you exaggerate these? >> i made mistakes with regard to my military service, misstatements. i was careless and learned a very painful and humbling lesson. this is very important to me. in my naval training as a naval officer, we are trained to take command, to be responsible, to be accountable for our personnel, for our unit and our mission. and i am completely accountable for this. so, i corrected the record. >> whoa, whoa. how does one get careless on that? if you served overseas, and you have, anybody who's in combat is very clear on whether they were in combat or not. if you're a voter and you're listening to this, should there

not be some credibility test for you? should that have some weight on whether you can be trusted if you're going to exaggerate your military record? something that sensitive? >> there certainly should be and the level of scrutiny here is completely appropriate because this is a very high office. for me, what i did first was to correct the record, then apologize to the people of illinois. then i released all 21 years of my officer fitness report, these are my confidential personnel file to everyone so that they could read. i'm very proud of my record. i've served in afghanistan in northern watch and operation allied force. i believe in this country very greatly and i would give my life for it. i think it's made me a better congressman. and a better advocate. >> bottom line, did you say you were once shot at when, in fact, you were not? >> for example, when you're flying over iraq as a big nato strike package, usually the iraqis opened up on us. but whether the squadron came under fire on us is -- >> you've called him a liar. this is a very serious charge.

do you accept his explanation? >> that's for the voters. but even more troubling than untruth was the military record than his phantom teaching career. more troubling to me are his votes in washington, d.c. here is someone where you don't know where he stands. "the chicago sun times" pointed out friday we don't know where he stands on important issues. now, david, the people of illinois may not always agree with everything i say, but they always know where i stand. he says he votes for cap and trade and doing it for the security of the united states and then as a republican for the senate and said he would never vote that way again and it was a huge mistake. they asked him on the don't ask, don't tell. he said he's not sure yet. i'll tell you where i stand. that's leadership. that's what the people of illinois want and that's what i'm give them the rest of my career. that's the fundamental difference in principles, values and more or less between myself and the congressman. >> i want to close with this and we're in partnership with facebook and their political page and we've solicited a question from dmitri morris.

congressman kirk, i'll start with you on this. name two issues on your party's platform that you do not agree with and why. >> for example, i backed stem cell research. i very much support hate crime legislation where it went through the house. i also supported health insurance for low-income kids through the s-chip program, rated as one of the most independent members of congress. fiscal conservative, social moderate. >> mr. giannoulias? two areas of the democratic party you don't agree with, where you bunk your party? >> as i mentioned, the way t.a.r.p. was handled was an enormously -- >> republicans started that. >> there was a missed opportunity. i would have loved to have seen increased access to capital requirements for banks to lend money out. we fought and saved jobs, one thing we did was go after wells fargo and looked at them and said, listen. you can't let this company falter. you can't let them fail. you know, congressman always uses the word "independent." the only thing he's been independent of in this race is

the truth. this is an incredibly important race. we need fresh leadership, new ideas. we need to help create jobs. people in illinois are getting crushed, crushed by this recession. washington washington, d.c. yes isn't working. and my question is why in the world would we send the same people who created this mess back to washington, d.c.? that's why the people of illinois need new ideas and fresh voices. >> the debate will continue. the campaign will continue in crunch time. good luck to both of you. thank you for sharing your views with us here on "meet the press." we'll be watching closely, of course. coming up here next, we will have our political round table and talk about some of the big issues that continue on the campaign trail. we'll have more from the campaign trail next week, next week, the colorado democratic senator, michael bennett will square off the republican and tea party favorite, ken buck, our senate debate series coming up next week on "meet the press." mid-term picture, new jobless numbers, tight races across the nation, and another high-level obama administration departure. how will it all impact the campaigns? our roundtable weighs in. joe klein and wall street

journal's peggy noonan after to manage their car insurance policy online. well, you know that's why we have 24/7 support, so customers can call us anytime. [ in a robotic voice ] does not compute. error. [ all ] error. error. error. malfunction, babs. beep. boop. boop. ha ha. very funny. powering down. [ new guy ] we're not really robots. [ thomas ] i thought we were. [ male announcer ] want a great deal on car insurance? go to esurance.

we're back. we turn to our roundtable to get perspective on today's debate as we get closer to november. joining me now, joe klein, whose most recent piece is the cover story, author of "what i saw: political life in the reagan era." "the wall street journal's" peggy noonan.

joe, dodging embarrassment obama agenda in the illinois senate race. he has been involved in this race. he's been campaigning for him. >> giannoulias just said he didn't know the full extent of the criminal activity of people that his bank was giving loans to. i don't think i've ever seen a politician say anything like that before. >> it's part of what has been such a negative campaign, peggy. and we put this on the screen now. it's a tight race, in part, perhaps because congressman kirk's statements about his military record but giannoulias is seen as more of a flawed candidate and perhaps that answer is going to dog him. >> yeah. i think it might. look, it is a very -- one of the things that turns off people about politics is that it can be so negative, so personal. they know if they look at their own lives, they know anything they did could be made into something huge, negative and bad if it were turned into a 60-second spot.

and a lot of people running for office this year do not want to talk about issues or do not want to talk about their past stands on issues and so they're just pounding each other personally. he lied, she lied. he did this. it lowers everything and is not fortunate during a crisis. >> did obama help him here? he's been really aggressive in campaigning. is there an obama effect in illinois? >> i was in kirk's old district during this road trip and obama has 50%, 59%, 60% approval in that district. a district that's gone full republican in the past. obama is still very popular in illinois. but i want to pick up on what peggy said. and the amazing thing to me about this debate is how much it is at variance with the way people are actually feeling in this country. they are freaked out. they're panicked. they really are scared that the jobs we've lost are not coming back this time and that their kids won't live as well as they have. and instead of this tit for tat political stuff you see in all

of the negative ads, they want to hear real ideas about how we're going to -- >> to that point, the cover piece i just mentioned, this is a portion of it i thought was so interesting. you write this, i found the same themes dominant everywhere, rethinking of basic assumptions, a moment of national introspection. there was an idea that washington was broken beyond repair, that i want to underline. but the disgraceful behavior of the financial community and debilitating effects on the country was the issue that raised passion by far in the middle of the country. it's like americans are saying who do we trust now? >> exactly. the investment community, people are putting two and two together. the same people who did the mergers and acquisitions that led to a lot of these jobs being shipped overseas then turned their attention to the housing market and began giving, with the help of fannie mae and freddie mac, these mortgages to people who shouldn't have gotten them, made a gazillion dollars off these crazy financial

products and then caused the crash of 2008. so, people are looking at the financial community. they're looking at china. and they're not seeing the president of the united states or the republicans really talking about this. >> peggy, to that point, look, you've got some populism, the tea party, christine o'donnell. some of these candidates come out of a place of deep economic anxiety that could be prolonged and there could be a real effect on our politics, prolonged unemployment and economic malaise. and that could be a real effect on our politics, prolonged unemployment. >> yeah, there could. look, i think joe and i were talking before we came out. the biggest change, politically, in my entire lifetime is the fact that the american people now no longer feel that they will be handing on to their country a stronger, better place where their kids will get a job and their kids can get a house. i wouldn't call it pessimism, but a new, sober, almost sadness is out there.

and, in part, is shaping things. nobody expects the kind of economic growth that we are going to need to produce enough jobs not only for everybody to keep their job, but for young people coming up. >> you write in a preface to the new book, you talk about reagan and that sense of optimism and belief in the future. our recent poll indicated that what's really tough is now that so many people are out of work, they don't have much faith in the president's policies to turn things around. that's kind of a death knell for a political party and a president. >> yes, and i think part of what's coming in just a few weeks in november is probably a rebuke of our current leadership. and i think that might be fairly severe, but the larger issue is that i don't think the american people look at washington and see people who, a, can know what needs to be done and, b, can actually summon the will and grit to do it. they don't see that leadership as likely and so they are

frustrated because they hire leaders to make things better and now they don't feel that whoever they hire will get them there. >> what is the dominant feeling or sentiment you hear expressed out there about the president himself? >> i didn't go through the deep south, which is very red. i also didn't go into urban neighborhoods, which are very blue. i went down diagonally across -- >> we have a map we can show. actually, of your trip. >> oh, really? >> yes. >> i want to remember this. but, anyway, people respect him. you don't see the fist-shaking anger that you often see on cable news. certainly there's some obama haters out there. most people respect him but they don't quite admire him. he's floating over this debate and doesn't seem to be part of the things that people are most concerned about. they don't understand what's in the health reform legislation. they don't understand what's in the financial reform regulation. they're beginning to see the stimulus in a different way. because you can't drive 30 miles in this country without hitting a road crew, and they're feeling

better about the auto bailout but they feel that the big issues that we're talking about here, the jobs being expressed overseas, china. they haven't heard from him. for every time someone mentioned afghanistan, the war in afghanistan, which is an issue i've been obsessed with, they mentioned china 25 times. >> can i say that i think that the issue, the way i would put it with regard to the president, is a certain off-pointness. the country has consistently been talking about the things a, b, and c. and he's on some other letters of the alphabet. even when he comes forward, the past week when he is on the stump, the issues he's speaking of seem extrainious to the central -- >> is there confidence in the. republican party? >> no, no. >> the frustration i hear is right. >> i've got to tell you, it's part of the sadness. >> we don't have people in washington who are real problem solvers, willing to speak like adults to other adults and say, this is what has to happen.

>> that's right. >> yeah. i think -- and, look, the rise of the tea party, great cliche we've all been talking about is very interesting, very evolving, very changing. its most interesting element is that it is not only a reaction to democratic party leadership, it is a critique of the past ten years of republican leadership. the republican party will either evolve and change in interesting ways along with the tea party or not but are the voters saying i love the republicans? >> not yet. >> i want to show sarah palin, speaking last night. it's interesting, some of what she said. and the following that she has. i want to play a piece of her speech because it gets to what may be next. this is what she said. >> i just want to say some things that maybe some of you can't say because i have no title. i have no uniform. i have no office. it's todd and me. and we're traveling -- i get to say what i feel and i'm going to speak for some of you who may be thinking it but can't say it. >> what does she represent, joe? she talked about a reagan-like

revival on the right. is she running? >> she may well be running. she represents maybe 30% of the population. from what i saw, the tea party movement had enormous impact within the republican party, but not beyond it. and maybe to some independents. >> if this could be described very briefly, people think they know what the republicans stand for -- lower taxes, less government, less regulation. they have no idea what the democrats stand for except for big slovenly pieces of legislation we've seen which contain ridiculous provisions. one candidate in nevada, republican, running for office says there's a provision in the health care reform bill that small businesses have to set aside areas for breastfeeding women to use their breast pumps. my dad was a small businessman. he didn't need to be told by the government to do that. he would have said use my office. >> we have about 30 seconds. what's the dynamic in the next 20 some odd days before the

election that may impact the results? >> that may impact the results? i do think the result is probably pretty set. i think it's going to be a rising up against huge spending, at least the american people feel maybe they can put some pressure on politicians to start to control federal government spending. >> and to contract government when it's not held to a very high esteem. >> yeah, and that's a conundrum. because when you talk to people out there, the deficit versus stimlous argument that goes on here in washington is settled. people would rather have the government spending money on job programs that actually work than on deficit reduction, which they've never really cared about in any case, although they say so when things aren't going well. >> but they have a sense that it's out of control, this spending, they really do. it's too big. the deficit -- when you get into the "t"s, trillions, you're in trouble. >> good place to end. thank you both very much. we'll leave it there and we'll be right back. [ female announcer ] where are people with moderate to severe

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that is all for today. be sure to join us next week. we will turn our attention to colorado where michael bennett is locked in a tight battle with republican challenger, tea party favorite ken buck. if it's sunday, it's "meet the press."