Is John McCain Conceding Michigan to Barack Obama?

This is a rush transcript from "America's Election HQ," October 2, 2008. This copy may not be in its final form and may be updated.

MEGYN KELLY, HOST: Inside the "Strategy Room" we go.

John McCain is pulling out of Michigan. He has cancelled an event there planned for next week and GOP officials say his campaign will not run any more ads on TV in the state after this week.

This is — polls in a critical swing state bring more good news for Obama. But do these polls at this point in the race mean anything?

Here with us now on the left, Julie Menin, who's a board member for Women's Campaign Forum and the 2007 chair for Should She Run Campaign — that's a pro-choice group. And on the right, former senior adviser to Mitt Romney, Kevin Madden. Hello.

KEVIN MADDEN, FORMER ADVISOR TO MITT ROMNEY: Hey, Megyn.

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KELLY: All right. Kevin, let me start with you. I told the viewers moments ago Howard Wolfson was gleeful about the news that McCain is pulling out of Michigan.

MADDEN: You said "skipping." I can fully picture him skipping, too.

KELLY: All right. I may have stretched the truth a bit. I'm a boy with Howard. But he was very happy. So, Kevin, is it a huge deal? Put it in perspective for us.

MADDEN: Look, this is about resources. And right now, the McCain campaign has to focus their very limited resources. You know, they accepted matching funds. They've got $84 million to spend after the period after the conventions. So they have to put their resources where they think they are best able to compete and where the electoral map is going to help them.

So they're going to take the money out of Michigan and put it into places like Wisconsin, like Florida, like Minnesota and they're going to compete there. And that's their strategy towards victory in November. And I think you'll probably see them announce that they're going to go into other places where there haven't been very big battleground fights in past elections like Maine.

Maine splits its electoral vote, so there's a very good chance that John McCain can get to 270 by just picking up even a couple of electoral votes in the second congressional district up in Maine.

KELLY: All right. So, Julie, you know, Howard was happy. But Kevin seems to be making the point. You know, look, he wasn't doing well in Michigan. It wouldn't have been a huge shock in John McCain had lost Michigan in this race. And now he's going to take his resources and divert them into states that he may actually be able to seize from Barack Obama. So maybe, skipping — premature.

JULIE MENIN, BOARD MEMBER, WOMEN'S CAMPAIGN FORUM: Well, listen. It's a very bad time for John McCain. And I'm sure Kevin would agree with me that John McCain, at this moment, probably wishes now that he had picked Mitt Romney who ties to Michigan and is very strong on the economy.

But it really boils down to two issues. Voters are very disaffected with McCain's handling of the economic crisis, his, basically, gambit of putting his election on hold, the campaign on hold and swooping into Washington with little plan. And I think...

KELLY: What did Barack Obama do?

MENIN: A lot more than John McCain.

KELLY: What did he do? I mean, he was in St. Paul.

MENIN: I mean, he even fought on the floor of the Senate last where Barack Obama gave a very non-partisan speech.

(CROSSTALK)

KELLY: What did Barack Obama do before last night to make this thing resolve?

MENIN: Well, one of things he really did to come into Washington at the meeting with the White House and asked questions of Paulson and of Bernanke. But John McCain didn't do - John McCain was silent for 40 minutes in that meeting, yet he was the one who wanted that meeting. And it just does not show leadership. And I think the American voters really understand that.

And McCain could not even control his own party. He had a revolt among House Republicans. He could not keep that under control. And by basically staking his campaign on this one issue, he was not able to win on this issue. And it also comes down, I think, though, to Sarah Palin and the fact that voters are learning more and more about Sarah Palin and they're really not liking what they see.

KELLY: Kevin, what say you? Did she have the facts right on why McCain's numbers - they are slipping across the board. You look at Florida, Michigan, Ohio, Colorado, Nevada, Pennsylvania — he is down in all those states.

MADDEN: Well, first of all, we have to remember that polls are just a snapshot in time. You know, we wouldn't be having this argument two weeks ago where the polls were either dead even or John McCain was up a few points.

So I think what you have to worry about with polls is the trend line. The trend line has shown that the polls are going up and the polls are going down. They very likely could swing back towards McCain.

But McCain has to do — he has to do something very important over the next 30 days and that is dismiss this notion that Barack Obama is a centrist politician. He is every bit outside the mainstream, a leftist- center politician on everything from economics to national security. So McCain has to go out there and make that argument in these last 30 days, his last 30-plus days to all these voters in these swing states.

KELLY: Kevin, what about the Palin factor? Julie points out she thinks Palin is now hurting McCain in the polls?

MADDEN: Well, look, I fundamentally don't believe that voters make their choice based on the bottom of the ticket. They make their choice on the top of the ticket. The problem with Sarah Palin is that the narrative over the last few days, the last few weeks has been that she is unprepared and she's inexperienced.

And instead, we have to get back to the narrative where Sarah Palin was the maverick, the reform candidate, somebody who was much more outside of Washington than everybody else inside of Washington. That's the Sarah Palin we need to show voters.

KELLY: Got it. Go ahead, Julie.

MENIN: Yes. But Kevin, listen, 30 percent of all vice presidents become president. We know that statistic. That's a very meaningful statistic. And the fact of the matter is the more we see of Sarah Palin, the more we see she does not have a fundamental understanding of the issues, the Supreme Court cases, foreign policy. She even showed a disinterest in the Iraq War and the surge. That is not what voters around America want to see.

KELLY: All right. We've got to leave it at that, guys, but we're out of time, but good debate. Julie Menin, Kevin Madden, thanks so much.

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