This is a rush transcript of "Special Report With Brit Hume" from October 15, 2008. This copy may not be in its final form and may be updated.
(BEGIN VIDEO CLIP)
DAVID AXELROD, OBAMA SENIOR ADVISOR: I think Senator McCain's problem is fundamental, which is he's got a bad argument. He's essentially on the wrong side of history. He's arguing for a set of policies and an approach that have been discredited in a really dramatic way over the last eight years.
GOV. SARAH PALIN, (R-AK) VICE PRESIDENTIAL CANDIDATE: He wants to paint us as that, just more of the same. And that strategy, though, thank the lord, that strategy is starting to wear so thin. The American people know John McCain, they know that he is his own man.
(END VIDEO CLIP)
BRET BAIER, HOST: There you see senior campaign advisor David Axelrod to the Obama campaign, and VP nominee on the Republican side, of course, Sarah Palin talking about the debate tonight, the final presidential debate. You can see it right here on FOX about two hours and 20 minutes from now. Brit Hume is hosting that.
What about this? What has to happen? What will happen? Some analytical observation from Fred Barnes, Executive Editor of The Weekly Standard, Nina Easton, Washington Bureau Chief of Fortune magazine, Mort Kondracke, Executive Editor of Roll Call, and Juan Williams, senior correspondent of national public radio, FOX News contributors all.
Fred, let's start with you-expectations?
FRED BARNES, EXECUTIVE EDITOR, THE WEEKLY STANDARD: It's the third debate. It usually doesn't matter much, a smaller audience.
And I think each of the three people involved have something they need to do. Bob Schieffer needs to make it interesting, and ask stuff that, one, hasn't been asked in the earlier debates that people are interested in, like abortion and guns and same-sex marriage, Cuba — and ask the candidates things they don't want to be asked.
Ask Obama about Bill Ayers and that Jeremiah Wright. Ask John McCain about Charles Keating, the insurance guy, the Keating five. Ask him why he had so many former lobbyists and maybe future lobbyists on his staff. Those would be good things to ask.
I don't think Obama has to do anything but just not make a mistake. He's ahead, so he can cruise. He is very self-disciplined anyway.
And, at the very least, McCain does have to raise the Bill Ayers thing, because he has been taunted by Joe Biden, you know, as if he's not a man and he won't look Obama in the eye and raise that.
I think he better — I think McCain has to deal with that.
BAIER: Even Senator Obama mentioned that he was surprised that it didn't come up in the last debate. David Axelrod was asked about that today on the plane. Take a listen.
(BEGIN VIDEO CLIP)
AXELROD: We weren't goading Senator McCain. Senator Obama made an observation that it was odd that the day after they were together that he brought it up.
(END VIDEO CLIP)
BAIER: Nina, do you think Bill Ayers will come up by McCain bringing it up, or possibly in a question by the host Bob Schieffer?
NINA EASTON, WASHINGTON BUREAU CHIEF, FORTUNE MAGAZINE: Probably I think McCain could bring it up. I think he may also bring up Jeremiah Wright for two reasons.
One is I think the physicality of the debate, it is going to be the two of them side by side. They have to actually look at each other, which we know McCain didn't do last time. So that could make for some sparks.
But I think what we've seen with John McCain in both previous debates is that he felt like he had to throw a Hail Mary. What he did with the first debate is he suspended his campaign to race to Washington for the rescue plan and asked that we postpone the debate.
That kind of blew up in his face when Barack Obama called him on it and said the president should be able to multi-task.
Debate two, he comes up with this idea to nationalize home mortgages, basically to take home mortgages off the hands of people who can't or won't pay them.
That kind of blew up in his face, too, when the conservative base said this doesn't sound very free market to me, a $300 billion plan.
So neither of those have really worked. But both of them show John McCain's character in these settings. He's going to try to do some big game-changing moment.
MORT KONDRACKE, EXECUTIVE EDITOR, ROLL CALL: I agree with, and I agree with what Fred said, too, that Bob Schieffer should ask right off the bat about Ayers and about Jeremiah Wright and, you know, whatever is embarrassing to McCain as well, and get those out of the way.
Look, we just had another trillion dollar loss in the stock market today. What the public cares about most is the economy. And I think that Schieffer ought to ask, "Look, Senator McCain, how are your policies different from George Bush's trickle-down economics?" and give him a chance to say that.
"What about what's going to happen, Senator Obama, if you are president, and Nancy Pelosi and Harry Reid are running congress? Aren't we going to have regulation and spending and taxes the way Democrats always do that are going to ruin the economy?"
Those kinds of questions that are provocative, I think, is what Schieffer ought to do.
BAIER: Juan, is there something that McCain can do that would be a game changer tonight?
JUAN WILLIAMS, SENIOR CORRESPONDENT, NATIONAL PUBLIC RADIO: I think there are things he could do. If we are just speculating here, I think he should take on the role of a populist avenger, the sheriff going in to Gucci(ph) Gulch and say I'm going to clear out bad guys.
You talk about golden parachutes and big paydays and lying on profits an earnings. I'm going to stop it. I'm going to speak for the American people who feel that what we've seen here is money going to the rich, and the rich in this case, corporate heads, who have disappointed us, who have betrayed the American system, betrayed capitalism.
I think if he went in there and made it clear, his vision as to exactly how he wants to go after people, it plays to the anger that people feel at the moment, the upset they feel about what's taking place on Wall Street, and that could help him. That could get us back to John McCain, the maverick, the hard-charging guy.
I think he has lost his voice in the midst of all this, not had a clear message. So he's got to combine that with explaining the economic packages an put forward this week, explain why that's going to get the economy going again, and then posit himself as this populist avenger.
BAIER: Obama plays it safe?
WILLIAMS: He's got to. He has nothing to lose, so he is going to play it close to the vest like a good poker player.
BAIER: Last word.
BARNES: Can I say something about what Juan said, which I agree with 100 percent. If McCain could do that and then be this fighter against those things for the rest of his campaign, it could work.
But the problem is he has done that occasionally and not followed up.
BAIER: What about the current president's economic move? Some now fear they are taking America down a path towards socialism. We'll talk about that when we return.
(BEGIN VIDEO CLIP)
DURST: I think it is a last he resort solution. But I think two months ago, whoever thought about this would have been fired and kicked out of any parliament in the world.
BUSH: I frankly don't want the government, you know, being involved with businesses, owning businesses. It's not — I don't think it's good for the country.
It was necessary that the stock be purchased to help us through this financial crisis.
(END VIDEO CLIP)
BAIER: There you see a London banker and President Bush talking about the moves made both here in the U.S. and around the world to buy stock in various banks.
There are incentives for those banks to buy back the stock after a certain amount of years, but there is some concern out there that this is a step towards socialism.
We're back with our panel on this topic. Nina, let's start with you. For people out there who don't get it, there is $250 billion infused into these various banks to buy preferred stocks, and there are incentives for the banks to buy back the stock after the markets have stabilized and recovered.
So there is the end of the line, right?
EASTON: It's still, and, by the way, I think you raised this question, this is a question that should be asked the candidates tonight, what is their exit strategy to move us forward from this, because, as you say, it is incentives. There is no cap on the time period.
Is this a slippery slope to socialism? I would say no, but it's a slippery slope to an end of unfettered free market philosophy in this country. Why? Because we have set this precedent of bailouts.
Dating back even before these capital injections, you look at AIG, you look at arguably Fannie Mae and Freddie Mac, Bear Stearns. How do you say no to other big corporations that come up and say, look, we're going to fail and destroy the economic system.
It set up a precedence that is going to be hard to be say no to, a. B, the other thing that really concerns me about this is a Democratic Congress saying, look, we injected capital into you. You better start following our agenda.
And the Democrats have an agenda when it comes to lending and who should be receiving loans and so on. I worry about that. And I think it's a politicization of our banking system that probably had to be done, but there is going to be dangerous long-term effects that we can't even see yet.
KONDRACKE: The bailing out, I think, is a painful enough process that nobody is going to want to repeat it.
But Nina is right. This could lead to the politicization of credit, of Congress starting to order the banks around as to what they can invest in and what they can't invest in.
And, also, remember, as part of the $700 billion rescue package, the Democrats wanted to put union representatives on the boards of these various banks that they got bailed out.
I mean, if the Congress starts ordering around who is going to be on the board of American corporations, I mean, that is a very bad precedent, and that's something that Obama definitely should be asked about.
BAIER: Fred, President Bush has made clear numerous times in numerous statements that he is not comfortable with this, but it is the step that he had to take. Is that message getting enough?
BARNES: I think so. They are cliches that cover this-"necessary evil." And that's what it is.
Look, I'm not looking at socialism. It is designed to pre-serve a free market capitalist system and free market financial markets as best we can in a horrible circumstance.
My only concern is one thing — will it work? Will it work? Are banks going to start lending to each other? Are credit markets going to open up? They have a little bit. They need to a lot more.
And, as Mort pointed out, the best way to look at whether there is growing confidence in what's being done is the stock market. It is always a bet on the future. It went way down today.
BAIER: Juan, if there is a Democratic president and Democratic congress, will the temptation be too great to stay in this kind of mobilization in these companies?
WILLIAMS: Right now it is not Democrat versus Republican. This is this is a Republican administration, and they are fully complicit in whatever goes forward in terms of these billions of dollars in bailout.
My sense is that it's not socialism, Bret, it is the government throwing a lot of money at banks, which remain private institutions with private investors and private agendas.
The suggestion here is the Democrats might start telling the banks what to do. My sense is that the banks will get away without having the government or people having any leverage, although it's all of our money keeping these banks afloat.
And I think the banks — and I wish that the people who are the captains of capitalism would have some sense of responsibility here to the little guy down the street, beginning with the investor, but also with workers.
BAIER: That's the last word on this panel.
Copy: Content and Programming Copyright 2008 FOX News Network, LLC. ALL RIGHTS RESERVED. Transcription Copyright 2008 ASC LLC (www.ascllc.net), which takes sole responsibility for the accuracy of the transcription. ALL RIGHTS RESERVED. No license is granted to the user of this material except for the user's personal or internal use and, in such case, only one copy may be printed, nor shall user use any material for commercial purposes or in any fashion that may infringe upon Fox News Network, LLC'S and ASC LLC's copyrights or other proprietary rights or interests in the material. This is not a legal transcript for purposes of litigation.