The following is a transcribed excerpt from 'FOX News Sunday,' July 11, 2004:

CHRIS WALLACE, FOX NEWS: Here to discuss the two tickets and where this very close campaign goes now are Tad Devine, senior adviser for Kerry-Edwards; and Matthew Dowd, chief strategist for Bush-Cheney.

Gentlemen, welcome. There is a lot to talk about this week.

All right, let's start with a fact, a number, no spin. According to your own internal polling — and Tad Devine, let's start with you and the Democrats — has John Kerry gotten any bounce this week from his selection of John Edwards?

TAD DEVINE, KERRY-EDWARDS ADVISER: I don't know because we haven't polled it.

But I can look at every single public poll out there. And if you look at the public polling, you know, I think what you see is it's a close race. I think we have an advantage, Kerry-Edwards. We've been ahead anywhere from two to sometimes five or six points — a poll out today with a six-point lead.

I think it's been very, very well received by the public. I know within the Democratic Party it's been an enormous success. And I think all the early public polling suggests that the public is very much in favor of John Kerry's pick.

WALLACE: I find it hard to believe you haven't been polling. And I'm sure the Republicans have mapped out. Have they gotten a bounce?

MATTHEW DOWD, BUSH-CHENEY STRATEGIST: As I mentioned in a memo I put out that I expected their bounce to start with the v.p. pick. And I think it has. I mean, he's gotten a slight uptick, whether it's temporary or not...

WALLACE: How many points?

DOWD: A few points: two or three points. And I expect that to continue over through their convention. They're going to be up in double digits after their conventions.

But, yes, he's dominated the news to a degree much less a positive way, I think, than they initially thought with what's been in the discussion over the past five days.

DEVINE: Chris, can I say one thing? And I know Matt's been talking publicly about this. I don't think, you know, this double- digit, 12-, 15- point bounce that they're talking about, that there's a reality behind this.

You know, we got the bounce already that we're going to get. If you look at the Democratic vote, it has already consolidated behind John Kerry — anywhere from 82 percent to 89 percent of Democrats. And every public poll say they support Kerry already.

So I think this bounce, which has happened in the past when we've had challengers who weren't that well-known within their own party, it's not going to be a 10 or 15 points bounce. It's going to be a close race all the way.

DOWD: They might want to get the chairman of their Democratic Party...

WALLACE: I was going to say, Terry McAuliffe, he said last week, 8 to 12 points.

DEVINE: He showed his typical exuberance. And I can understand that. But, you know, if you look inside the numbers, I think you're going to see it's a close race.

WALLACE: Folks, this is what's called managing expectations.

Why do you, one, contend that they haven't gotten the public acceptance? And, obviously, one of the things that's been going on here is that both sides have been rushing to define John Edwards to the voters.

Why do you say, Matt Dowd, that they haven't gotten public acceptance?

DOWD: Our goal wasn't to define John Edwards. Our goal was to say what the pick of John Edwards says about John Kerry. And I think it says two things.

First, they've decided that branding their ticket is the most out-of-the-mainstream, liberal ticket in the history of the Democratic party. It's fine. And to run that's way is fine. They have the first most liberal and the fourth most liberal member of the United States Senate.

And second, it says for a guy that John Kerry said himself was not qualified to be president and needed on-the-job training, to pick that person as vice president, in what he says himself is the most important criteria, says a lot about what he does for political expediency.

DEVINE: Chris, you know, I recall some of the things that President Bush said about John McCain in 2000 in terms of people running against each other. I recall the way the president's father said Ronald Reagan's economic plan was voodoo economics. I mean, listen, you can always pick something out when people are contesting for a nomination and say, "Ah-ha, they said something terrible."

The fact is that John Kerry and John Edwards share the values and priorities of the great middle class of America. That's why they're going win this election.

WALLACE: All right. I want to switch subjects to the Republicans, because former Senator Alfonse D'Amato, Matt Dowd, said this week that George Bush dumped Dick Cheney.

And the fact is let's look at some numbers here. According to a new Gallup poll, 43 percent of voters have a favorable opinion of the vice president while 44 percent are unfavorable. In comparison, John Edwards's numbers are 54 to 16. And a new Time magazine poll finds that 51 percent say Cheney's ties to Halliburton make them less favorable to him.

Matt Dowd, that is not much support for a man who has been vice president for almost four years.

DOWD: Well, the interesting thing to me is that presidential elections are about President Bush versus Senator Kerry. And that's what this is going to be about. If the vice presidential pick in picking somebody that was going help your ticket in a way, Tad would have been working for President Dukakis in 1989 when the picks were Lloyd Bentsen versus Dan Quayle.

WALLACE: Is Dick Cheney a drag?

DOWD: Dick Cheney's not a drag at all. He's a very experienced person. He's shown great leadership over the past three years. He's going to be very helpful in the campaign. You'll see it by where we send him. If Dick Cheney lets us, we will send him to every city we possibly can to campaign. And we are fine with him campaigning wherever he can.

DEVINE: Chris, in the last week we've produced two television commercials with John Edwards, including one we're releasing today where John Edwards narrates the full commercial. Dick Cheney, you know, it's like "Where's Waldo?" finding Dick Cheney in that commercial. I mean, like there is no way they're going to ever put him in a single ad because they don't want to be seen with him

DOWD: This is the first time a presidential campaign has ever used a vice president to try to sell the ticket. I mean, it's very interesting to me that John Kerry, who's favorable/unfavorable ratio is lower not only than ours but lower than John Edwards, has to use his vice presidential pick to try to sell the ticket.

DEVINE: That's not true. Lloyd Bentsen made a five-minute piece for Mike Dukakis in '88. So listen, we've got...

DOWD: And they never bought that. They never bought that.

DEVINE: ... a great pick for v.p. And we're proud of him. They've got a pick in a current vice president who they don't want to be seen in public with. That's the difference.

WALLACE: All right, gentlemen. Values have become a big issue in this campaign.

Mr. Devine, at a fund-raiser this week, entertainers called the current president George Bush a thug, a liar. Whoopi Goldberg made vulgar remarks about the president's last name. And then John Kerry had this to say about the performance. Let's listen.

(BEGIN VIDEO CLIP)

KERRY: Every performer tonight, in their own way, either verbally or through their music, through their lyrics, have conveyed to you the heart and soul of our country.

(END VIDEO CLIP)

WALLACE: Do those kinds of remarks, Mr. Devine, convey the heart and soul of the country?

DEVINE: No. And he's made that clear. Senator Kerry and Senator Edwards have both made it clear that some of the things that were said there, they simply don't agree with.

WALLACE: So why did they...

DEVINE: Well, he was talking generically about artists and performers. But he has also made clear...

WALLACE: He said those artists and those...

DEVINE: But he has also made clear, Chris — and I don't know if he sat there and heard every word that they said. But he's also made clear that, you know, in this campaign, people like them, whether it's performers or other people — angry Americans.

Let me tell you something, the people are angry because this president has polarized this nation like none before. They have a right to speak out. And that anger about Bush and his policies is what drives people to say what they say.

WALLACE: All right.

Matt Dowd, I want to ask you about another question.

This week, the Senate is going vote on the constitutional amendment to ban gay marriage. You clearly, by all accounts, do not have the votes to actually pass it through the Senate. Why bring it up?

DOWD: Well, I mean, I think we'll see a good debate in the Senate over this issue. I think there's going to be people on both sides debating. The president, obviously, in his radio address says it's very important to push this issue that marriages should be defined as between a man and a woman.

I want to go back to one thing about values that I think is an important thing to discuss here. This is a very — watching this past week, it's very Alice in Wonderland where down is up and up is down.

You have a candidate who a week ago said he represents the conservative values this country, who is the number one-rated liberal in the United States Senate, who has voted for every single tax increase he possibly could, who has voted against parental notification on abortion, who has voted for partial birth abortion.

On every issue he stands way out of the mainstream. And then he flies back to Radio City Music Hall to listen to a diatribe, the most hate-filled speech from some people out of Hollywood. And he doesn't say a word that night, doesn't open his mouth, say a word, walk out. But now they realize it's political heat and they don't want to take back the sentiment but they want to take back the words.

So I think if you're consistent and you believe in what your values are, you state them from the start to the finish. They are all over the map.

DEVINE: Chris, this will just tell you how much trouble they're in. You know, here we are in July. And they're talking about partial birth abortion, gay rights, you know, a very hot button social agenda. And I'll tell you why they're talking about it: Because they're in trouble, big trouble, and they know it. They're in trouble with their own base. For example, the party. And they're trying to energize it.

And they're also not speaking to the great middle of America. OK, people who are concerned about job loss, massive job loss — 4 million Americans have lost their health care. They're concerned about issues like energy independence. They're concerned about security because America now has divided itself from the rest of the world.

WALLACE: Ten seconds and I want to ask you both. You've got to give me a yes or no. Are both of you willing to pledge that your campaigns will stick with public financing, accept the $75 million and not go to private financing during the general election?

DEVINE: Well, I don't know what they're going to do. We'll have to wait and see. But right now...

WALLACE: You have to decide before them.

DEVINE: Our plan right now is to stay within the system of public financing.

WALLACE: So you're not flatly going to say that you're going to...

DEVINE: Well, you know, they may get out next week and that they may change the circumstances. But right now, our plan is to stay within the system.

DOWD: The Bush campaign plans to stay within the public financing system. As we've said before, we're going to...

WALLACE: So it's a pledge, you're going to stay?

DOWD: We're going to stay with — as much of the decision I could make about the pledge, we're going to stay within the system...

DEVINE: Why not? They've got an eight-week general election and we've got a 13. So naturally, they're going to stay.

WALLACE: Since he's now pledged that, are you going to stay within the system?

DEVINE: Well, like I said, Chris, that is our intention. But remember, they've got an eight-week general election. We've got a 13- week general election. They've got a huge advantage. Of course, they're going to stay.

WALLACE: So you're saying it's still an open question?

DEVINE: That's our plan. That's our plan, to stay within the system.

WALLACE: All right. Got to leave it there.

Gentlemen, thank you both so much. See you at the conventions.