Senator John Edwards phoned Senator Barack Obama yesterday when Obama was in El Dorado, Kansas. According to Obama staffers, Edwards told Obama he was likely to drop out of the race, but had not yet made a decision. They two also talked about poverty, an issue for which Edwards has championed during his campaign for the presidency.

Staffers confirmed that Edwards phoned Obama again this morning prior to the candidate’s Denver rally to inform him that he was, in fact, dropping out. The two did not discuss an endorsement, but staffers say obviously Obama would like Edwards’ support going forward.

“I congratulated him on a great race and what a gracious way to end by going back to New Orleans,” Obama said to a reporter before talking to an overflow crowd at his Denver rally. When asked what impact Edwards’ departure would have on the race, Obama answered, “I don’t know.”

Here’s what Obama said about Edwards to a crowd of about 9,000 in Denver:

Clinton Campaign Statement on John Edwards withdrawal from the Democratic Race:

“John Edwards ended his campaign today in the same way he started it - by standing with the people who are too often left behind and nearly always left out of our national debate.

John ran with compassion and conviction and lifted this campaign with his deep concern for the daily lives of the American people. That is what this election is about - it’s about our people. And John is one of the greatest champions the American people could ask for.

I wish John and Elizabeth all the best. They have my great personal respect and gratitude. And I know they will continue to fight passionately for the country and the people they love so deeply.”

Edwards called Clinton yesterday to say that dropping out of the race today was a possibility. He called again this morning to break the news officially, and she promised to keep his core issue of poverty in America at the forefront of the campaign.

Listen to what she had to say to reporters about Edwards here:

Fox News has learned that former Senator , and Democratic contender for the White House, John Edwards will announce today in New Orleans that he is dropping out of the race. Edwards press staffers say that he will “not endorse anyone at the moment.” 

As we in the press corps wait for Senator Barack Obama’s 9 o’clock victory speech here at the Columbia Convention Center, the crowd is trickling in after going through security. Obama’s staffers are freely mingling in the press area - something they did in Iowa, but not in New Hampshire - or Nevada, when they all left the state before the caucus. A giant television screen suspended from the ceiling is blasting CNN - which just showed video of Senator Hillary Clinton leaving her South Carolina hotel. The crowd booed. The boos were just as loud when the monitor showed video of former President Bill Clinton speaking in Independence, Missouri. The crowd, of course, cheers every time the network delivers pro-Obama news. At one point the diverse crowd chanted, “Race doesn’t matter!”

Barack Obama began what would be a successful day in his candidacy at Columbia’s Bethelehem Baptist Church, followed by a quick stop at a polling precinct at the historically black Benedict College - sans press. A small press pool was allowed to accompany Obama to greet patrons of Harper’s Restaurant, where Obama exchanged pleasantries and posed for photos with nearly every table and some of the restaurant’s employees before leaving.

The Senator spent much of the day holed up in his Columbia hotel, where he did multiple interviews via satellite with South Carolina and February 5th state television stations. To unwind, Obama along with two staffers (including his body guy, Reggie Love, who used to play for Duke University and 6′8″ trip director, Marvin Nicholson) played a little basketball with some of Obama’s Secret Service detail. Obama’s team won the best of three contest, two games to one.

Shortly after the polls closed in South Carolina, Senior Advisor David Axelrod and Communications Director Robert Gibbs emerged from their hotel to walk the short block to the Columbia Convention Center. Gibbs told a gaggle of reporters that it appears the white vote was “far closer” than anyone had thought it would be - early exit polls show that Obama received a whopping 80% of the African American vote and 24% of the caucasian vote as compared to Hillary Clinton and John Edwards’ 38% each.

This is an election about delegates - not states, Gibbs said. The campaign sent out a statement that estimated Obama snatched 25 delegates here in South Carolina. Clinton picked up 12 and Edwards 8, per the Obama campaign. Their tally now has Obama leading the delegate count 63 to Clinton’s 48 and Edwards’ 26.

Gibbs waas sure that the race for the nomination would not be decided by February 5th. Expect a long battle that could extend into April. Gibbs was unsure if Hillary Clinton had called Barack Obama to congratulate him on his victory, but in a statement put out by the Clinton Camp, Clinton said she had called to “congratulate him and wish him well.” It continued, “We now turn our attention to the millions of Americans who will make their voices heard in Florida and the twenty-two states as well as American Samoa who will vote on February 5th.”

In a tight race, the expectations game is crucial; a better than expected second place in a state can be spun as a win for an underdog, while a closer than expected victory can be seen as a loss for a front-runner.

So when Clinton aides point to recent polls to suggest they’re expecting a double-digit loss in South Carolina, reporters see them trying to set expectations low so that a four-point loss might turn into a positive story for the campaign.

Similarly, when the Obama campaign released a memo today pointing out just how much Clinton has done to win the state, reporters understand that they’re trying to prevent an Obama win of any size from being seen as a loss — or just as bad, as expected and therefore unimportant.

In the memo, Team Obama tells interested parties to look past the Clinton spin — saying  “the truth is Hillary Clinton’s campaign is pulling out all the stops to win in South Carolina. And it includes saying and doing just about anything to win.”
Trouble is, Obama himself criticized Hillary for not taking the state seriously enough after spending much of the last week in Feb 5th states — telling CBN’s David Brody, “I think the South Carolina voters will have to make an assessment in terms of how seriously she’s taking the state. She said last night that Bill Clinton wasn’t the one running for resident, but this is the next primary and he’s the one who’s staying behind.”

Clinton spokesman Phil Singer asks “does the Obama campaign think we are giving up on South Carolina or going all out for it? I guess it depends on the day.”

Read the full Obama memo after the jump

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While addressing a crowd of 200 people in Bennettsville, South Carolina, John Edwards criticized Hillary Clinton for choosing to leave the state in the days before the January 26th primary.

Clinton left South Carolina after participating in Monday night’s Democratic presidential debate in Myrtle Beach to campaign in states scheduled to hold contests on February 5th.

“Right after the debate, she flew out and she’s been gone and she won’t be back until I don’t’ know—later in the week or until primary day,” Edwards said. “And the question is, if she’s not going to spend time here the week before the South Carolina primary, what do you think the chances are she’s coming back after the primary? And what are the chances she’s coming back when she’s president of the United States?”

In his criticism of Clinton’s absence, Edwards sought to depict her as a politician not genuinely committed to the needs of those living in rural South Carolina. He also characterized the rural South as “forgotten America,” emphasizing his Southern upbringing to persuade voters that he identifies with and understands their economic hardships.

“We need a president of the United States who actually understands your life. It’s one thing to fly into South Carolina from some place else, give a speech, go to a debate and then fly back out,” he said. “It is a very different thing to have lived here, to have grown up in this part of the country and to understand in a personal way what’s happening in your lives. I do.”

On the heels of Monday night’s Democratic presidential debate, John Edwards launched a new television ad on Tuesday to run in South Carolina, challenging his Democratic opponents on accepting lobbyist money—an issue that has become the touchstone of the former North Carolina senator’s grassroots campaign.

The 30-second ad, titled “What Happened,” begins with side-by-side images of Hillary Clinton and Barack Obama on the screen. The announcer says: “One gets more money than anyone from drug companies. The other one takes more money than anyone from Washington lobbyists. What’s happened to the Democratic Party?”

As the pictures changes to images of Edwards speaking before large crowds and mingling with supporters, the narrator continues: “The only one who’s never taken a dime from PACs or Washington lobbyists, who knows we’ve been ignored too long, who knows that rebuilding the middle class is more important than politics—our John Edwards. The only one.”

Edwards has centered his campaign on the principle of “taking back America.” He reasons that one cannot reduce the power of lobbyists who control Washington if he or she is accepting their money. While campaigning in Iowa in December, Edwards announced he would ban all corporate lobbyists and individuals who have lobbied for foreign governments from working in his administration, if elected.

In an attempt to make a comeback in a state he won during the 2004 primary election, Edwards will embark on a two-day “Back Roads, Back Home Barnstorm” of South Carolina on Wednesday, targeting small towns and rural communities in the hopes that his populist message will resonate among rural voters. During Monday night’s debate, Edwards argued that he is the only Democratic candidate who can “go everywhere and compete head-to-head” with the Republican nominee, including in places like the rural South—a demographic, he said, the Democrats cannot afford to lose in the general election.

“We can’t concede places like South Carolina, North Carolina, Georgia, Missouri,” Edwards said.

“We always do well in Chicago, or New York, or Los Angeles, Seattle. We do well in the big urban areas. The question is: Are we competitive in the rural areas, in the tougher places for Democrats to compete?”

On the eve of Martin Luther King Day—just moments before the start of the Democratic presidential debate in South Carolina—John Edwards’ campaign released a letter sent by King’s son, Martin Luther King III, to the former North Carolina senator, praising him for his commitment to end poverty and injustice and calling for all candidates to emulate his initiative.

“I want to challenge all candidates to follow your lead, and speak up loudly and forcefully on the issue of economic justice in America,” King wrote. “My dad was a fighter…Keep fighting. My father would be proud.”

Edwards and King held a private meeting at the King Center in Atlanta on Saturday, and though details of that encounter were not disclosed to the press, the two men discussed Dr. King’s legacy and their “shared commitment to fighting poverty,” according to Mark Kornblau, a spokesman for Edwards’ campaign.

In his letter, King addressed the aims of Edwards’ campaign mission: “I appreciate that on the major issues of health care, the environment, and the economy, you have framed the issues for what they are - a struggle for justice. And, you have almost single-handedly made poverty an issue in this election.”

The letter could not have come at a more opportune time for Edwards, who was asked at the end of Monday night’s debate, “If Dr. Martin Luther King were alive today…why do you think he would or why should he endorse you?”

Without hesitation, Edwards said he has focused his cause on the “two biggest issues that Dr. King stood for, which are the issues of equality and ending poverty in America.”

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Despite his distant third place finish in the Nevada caucuses, John Edwards says he is the only Democratic presidential candidate who can beat all Republicans in a general election—including potential GOP frontrunner, John McCain.

“I think it’s important for us to have somebody run against McCain who can beat him,” Edwards told reporters outside a restaurant in Winnsboro, South Carolina, on Sunday. “And national polls show that I’m the one who beats John McCain in the general election.”

In addition to mentioning polls that find he is best suited to stand against a Republican next November, Edwards raised the issue of campaign finance reform. Edwards—whose campaign is publicly funded—has long prided himself in his refusal to accept money from Washington lobbyists, reasoning that one cannot challenge corporate powers and “bring change to Washington” if he or she has taken lobbyist money. Edwards has called for campaigns to be publicly financed, and often tells voters, “we’re going to have an election, not an auction,” as he travels around the country.

While some have doomed Edwards’ candidacy due to lack of funds (compared to senators Barack Obama and Hillary Clinton, who have each raised over 100 million), Edwards says his stand on campaign financing would work to his advantage—particularly in a race against McCain, who has also sought to reduce the influence of money in the campaign process.

“This is a guy who’s made central to his political life campaign finance reform,” Edwards said of McCain. “It seems to me we ought to be putting somebody up against him who’s never taken money from special interest PACs or Washington lobbyists. Between the three of us, that’s me.”

In an editorial board meeting with a Reno, Nevada, newspaper last week, Senator Barack Obama said what turned out to be ammunition for rival campaigns. “Ronald Reagan changed the trajectory of America in a way that Richard Nixon did not, and a way that Bill Clinton did not,” Obama told the newspaper. “I think it’s fair to say that the Republicans were the party of ideas for a pretty long chunk of time there over the last 10 to 15 years in the sense that they were challenging conventional wisdom.”

Both John Edwards and the Clinton campaign used these comments to make it clear that they, good Democrats, did not approve of Ronald Reagan’s policies. “I would never use Ronald Reagan as an example of change,” Edwards told the Associated Press. His campaign later put out a statement. “The breadth of change Ronald Reagan brought was crippling for millions of Americans, with the two worst recessions since the Depression, a complete disregard for the rights of American labor, and tax cuts that lined the pockets of the richest Americans at the expense of fiscal sanity and the well-being of the most vulnerable in our society,” said Edwards campaign manager David Bonior.

The Clinton campaign dispatched surrogates to respond. Corrine Brown (D-Fla.) wondered, “I would like to know what Republican ideas he thinks are great ideas.” Brown then listed Reagan-supported plans to privatize Social Security and abolish the National Education Association as well as provide tax breaks to the rich. President Clinton also weighed in, saying Obama “said that since 1992, the Republicans have had all the good ideas. So now it turns out you can choose between somebody who thinks thinks our ideas are better, or the Republicans had all the good ideas.”

Today Senator Obama responded to their criticisms at his Columbia, South Carolina rally, saying his statements have been mischaracterized - just another Washinton “trick.”

“I didn’t’ say I liked Ronald Reagan’s policies,” Obama explained. “What I said was that was the kind of working majority we need to form in order to move a progressive agenda forward. So when I see, you know, Senator Clinton or President Clinton distort my words, say somehow that I was saying Republican (sic) the only ones who had good ideas since 1980 – then that is not a way to move the debate forward. That is not a way to help the American people. And I am not running for president just to become president – I’m running to help the American people and move the debate forward. I’m not willing to say or do anything just to win an election, because when you start operating that way, you lose the trust of the American people and we need trust if we’re going to build the kind of country that all of us want for our children and our grandchildren.”

Obama told the crowd that Reagan “was able to tap into the discontent of the American people and he was able to get Democrats to vote Republican – they were called Reagan Democrats.” This skill of bridging party divides is one that Obama admits he hopes to emulate. “We as Democrats right now, should tap into the discontent of Republicans. I want some Obama Republicans!”

Seems like the Obama campaign has been thinking about this - or at least they came up with a snazzy name for these Obama Republicans: “Obamacans.”