Former Alaska Gov. Sarah Palin speaks to supporters at a Republican National Committee rally in Orlando, Fla., Saturday, Oct. 23, 2010.(AP Photo/John Raoux) (Associated Press) 
 
 Former Alaska Gov. Sarah Palin speaks to supporters at a Republican National Committee rally in Orlando, Fla., Saturday, Oct. 23, 2010.(AP Photo/John Raoux) (Associated Press) 
 
 Sen. John McCain is calling Sarah Palin an "outstanding candidate" for the Republican presidential nomination in 2012, but says it's too early to endorse her. 
 
 McCain told CBS's "The Early Show" Tuesday that "I don't think Sarah would want me to, before she's even able to make a decision" about running. 
 
 The Arizona Republican said "it's very early to start picking winners and losers." He said he still holds his 2008 running mate "in high regard" and said he's been amused by the former Alaska governor's confrontations with "the liberal media." 
 
 Palin has been active in the campaign, raising money, throwing her support behind a host of tea party-backed conservative Republicans and giving speeches around the country. ||||| When asked if the Republican Party - which some predict will win control of the House of Representatives next week - will win a majority in the Senate, the GOP's 2008 presidential nominee declined to foresee success. 
 
 Appearing on CBS' "The Early Show" this morning, Senator John McCain, R-Ariz., said, "I'm a little worried about some of my Republican friends who are taking a victory lap about a week ahead of time. 
 
 "And indications are that, as always, the Democrats have a very sophisticated get-out-the-vote operation. We've got to get our vote out. 
 
 "If I had to predict," McCain told anchor Harry Smith, "and I'm very hesitant to do so, I think we will be up late, or even after election night, waiting to see what happens in California and the state of Washington. I think the election will probably depend on that, as far as Senate majority." 
 
 Special Report: Campaign 2010 
 
 As a co-sponsor of campaign finance legislation that was all but gutted by the Supreme Court's decision in Citizens United, which allowed unfettered spending of money from anonymous donors (including corporations, industry groups, unions and non-profits), McCain said the current glut of spending by House and Senate (according to the Washington Post, nearly $2 billion for this midterm) and by outside groups (an additional nearly half-billion dollars, much from hidden sources), was feared. 
 
 "Yeah, we were worried about that," said McCain (who alone spent about $20 million to defeat his primary opponent J.D. Hayworth), "especially money that comes from sources that are not really known. Or money like the unions that spend without the permission of union members - obviously many union members who don't agree with the far left agenda of the union leadership. 
 
 "So, it is what it is, and we're in for an interesting election." 
 
 Looking ahead, McCain was asked about the prospect of compromise in Congress over the Bush era tax cuts, which are due to expire at the end of this year. While most agree that tax cuts for middle class Americans should be extended, battle lines have been drawn against whether the richest two percent of Americans should also have their tax cuts continued. 
 
 Doing so, Democrats argue, would increase the federal deficit by $700 billion over the next decade. 
 
 Though a recent CBS news poll shows a majority of Americans say tax cuts for those making $250,000 a year should not continue, Republicans are fighting for them. 
 
 "Democrats are floating the idea of moving that ceiling up to $1 million a year," said Smith. "If the Bush tax cuts, which are up for renewal, come up again and they say, 'You know what, we'll just only tax people who make $1 million or more,' is that something you might be able to stomach?" 
 
 "Look, let's just extend them all for a couple of years and then worry about it, and see what happens a couple years from now," McCain replied. "We're not going to get into a bidding war with the Democrats over what level [of] rich people we hate. 
 
 "Look, we don't need to raise anybody's taxes at this time. Let's extend them for a couple of years, as 45 Democrats in the House said that they were committed to [doing], and let's start attacking the real problem, and that's spending. 
 
 "Taxes isn't the problem; it's spending that's the problem. And so that's what we need to do." ||||| Mark Peterson / Redux 
 
 The music swells and then picks up tempo. Sarah Palin is talking about how 2010 will be the year that "commonsense conservative women get things done for our country." She's worried about "these policies coming out of D.C. right now, this fundamental transformation of America," and reports that she is not alone. "Moms kinda just know when something's wrong," she says. "You thought pit bulls were tough? Well, you don't wanna mess with the mama grizzlies!" 
 
 Can a two-minute Internet video reshuffle a Republican presidential race before it has even started? Palin's glossy yet authentic clip, released without any fanfare July 8, did just that. It was the surest sign yet that she means to be an energizing factor in this year's midterm elections and will mount a real bid for the White House in 2012. Most compelling is the way the video targets women, specifically moms, whom Palin exhorts to vote in the midterms and halt the Obama agenda. The video features image after image of everyday, determined, smiling, patriotic mothers and grandmothers, all keen to join her army of supporters. Palin calls it a "mom awakening." If she can inspire GOP and independent women to turn out for the party's candidates in November, she could decisively influence the outcome of the midterms. (See TIME's special "After Alaska: Sarah Palin's Year of Living Large.") 
 
 Palin doesn't need specific policies  or even specific criticisms of Obama  to crank up the energy. She knows that injecting emotion into the conversation is the most efficient way to spark a movement. Her charming if idiosyncratic way with words may also be an asset: "Look out, Washington, because there's a whole stampede of pink elephants crossing the line, and the ETA stampeding through is Nov. 2, 2010. Lotta women comin' together." (See photos of Sarah Palin's life since the 2008 election.) 
 
 John McCain saw this inspirational side of Palin when he named her his running mate in 2008. Ultimately, that move did him no good, but Palin's video proves that she is savvy and sophisticated enough to harness her star power for political effect, shrugging off the cartoonish taint that has clung to her since she and McCain lost. Many GOP insiders and consultants, some of whom had dismissed Palin's chances as a presidential contender and written her off as a political flameout, say they are impressed by the competence and impact of Palin's new approach. Says veteran Republican strategist Greg Muller: "She's set herself up very, very well. She is only going to get stronger." The majority of voters are still skeptical. A new TIME poll shows Palin losing to Obama 55% to 34%, a lopsided ratio that leads some Republican strategists to predict a wipeout if Palin is eventually chosen as the party's nominee. 
 
 But that might not matter. Palin has stayed busy endorsing candidates in competitive Republican primaries, picking her share of winners and losers and, in some contests, helping determine the outcome. Her political-action committee raised more than $865,000 in the past three months and has beefed up its staff. Palin has enjoyed some personal victories too: Levi Johnston, the father of her grandchild, made a public apology to Palin on July 6, complete with a retraction of damaging allegations he made about her family in the past. This week Johnston and Palin's daughter Bristol reannounced their engagement after months of estrangement, removing  with apparent serendipity  a blemish from her wholesome narrative. (See photos of the fashion looks of Sarah Palin.) 
 
 The question for Palin now: Can she build on this moment? Although she has taken few steps to prepare for a presidential contest, her path is becoming clearer. It starts with a big advantage: she would be the only woman running against a half-dozen or more Republican men. As long as she leaves the door to the race open, she can freeze the field, prevent other GOP hopefuls from gaining much traction, keep the media in a perpetual will-she-or-won't-she frenzy and jump into the race whenever she likes. That would be impossible for an ordinary candidate, but Palin could splash in as late as November 2011, just a few months before the voting begins. There is no deadline for signing up for the Iowa caucuses, and when it comes to competing in early-state contests, she will have a far easier time than any previous insurgent. Her candidacy would require almost none of the usual time sinks that force politicians to jump in early: power-broker schmoozing, schedule-intensive fundraising, competitive recruitment of experienced strategists, careful policy development. She would have immediate access to cash, with even small Internet donations likely bringing in millions. 
 
 Already the most arresting political figure other than the President, Palin will be even more visible in the coming months. After a year of profitable speaking, bookselling and punditry on Fox, she will do some promotion in August for the paperback release of her best-selling Going Rogue. When it airs in the fall, her documentary series about Alaska on TLC will attract both curiosity and viewers. And after the midterms, her second book, America by Heart: Reflections on Family, Faith, and Flag, will hit stores in time to rack up millions of dollars in Christmas sales. She keeps in touch with her fans via Twitter and Facebook; on July 13 she pushed back hard after the NAACP criticized the Tea Party. (See TIME's Sarah Palin covers.) 
 
 Palin thrives on the unpredictable, and as her new video shows, she can adapt quickly. "What she knows, you can't teach," says Mark McKinnon, a top strategist for George W. Bush and McCain. "And what she doesn't know, she can learn  and she's learning fast." 
 
 Read "Sarah Palin to Muslims: Reject Ground Zero Mosque." 
 
 See TIME's Pictures of the Week.
– John McCain thinks a lot of people are getting ahead of themselves. Asked on CBS’ Early Show if he’d endorse Sarah Palin for president in 2012, he said she’d make an “outstanding candidate,” but that it was too early to say he’d endorse her. “I don’t think Sarah would want me to, before she’s even able to make a decision” about running, he said, according to the AP, adding “It’s very early to start picking winners and losers.” For that matter, McCain thinks it’s too early to call the midterms. “I'm a little worried about some of my Republican friends who are taking a victory lap about a week ahead of time,” he said. “Indications are that, as always, the Democrats have a very sophisticated get-out-the-vote operation. We've got to get our vote out.”