On Sunday’s CBS "60 Minutes," anchor Steve Kroft interviewed Hillary Clinton and Barack Obama, along with a small group of Ohio Democratic voters who, as Kroft explained: "told us that both race and gender would be hidden factors in southern Ohio, that many blue collar workers here won't vote for a woman, and others would never vote for a black." Kroft went on to focus on Obama: "And Senator Obama has another problem: a malicious campaign against him that surfaced in a number of our interviews."

This "malicious campaign" as Kroft sees it is the suggestion by some that Obama is a Muslim. Kroft was shocked to find this belief from one of the voters he talked to, Kenny Schoenholtz, who said:

I'm leaning towards Obama. There's a couple issues with him I'm not too clear on...Well, I'm hearing he doesn't even know the national anthem. He wouldn't use the Holy Bible. He's got his own beliefs, with the Muslim beliefs. And couple of issues that bothers me at heart.

Kroft was concerned that this one misinformed voter, who said he would probably vote for Obama anyway, was reflective of broader smear against the Illinois Senator:

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KROFT: One of the things that we found in southern Ohio -- not widespread, but something that popped up on our radar screen all the time, people talking about it, this idea that you're a Muslim.

OBAMA: Right. Did you correct them, Steve?

KROFT: I did correct them.

OBAMA: There you go.

KROFT: Where's it coming from?

OBAMA: You know, this has been a systematic e-mail smear campaign that's been going on since, actually very early in this campaign. Clearly, it's a deliberate effort by some group, or somebody, to generate this rumor. I have never been a Muslim, am not a Muslim. These e-mails are obviously not just offensive to me, somebody who's a devout Christian who's been going to the same church for the last 20 years, but it's also offensive to Muslims because it plays into, obviously, a certain fear-mongering there.

Kroft then aggressively questioned Senator Clinton on the issue:

KROFT: You don't believe that Senator Obama's a Muslim?

CLINTON: Of course not. I mean, that's -- you know, there is no basis for that. You know, I take him on the basis of what he says. And, you know, there isn't any reason to doubt that.

KROFT: And you said you'd take Senator Obama at his word that he's not a Muslim.

CLINTON: Right. Right.

KROFT: You don't believe that he's a Muslim or implying? Right.

CLINTON: No. No. Why would I? There's no, there is nothing to base that on, as far as I know.

KROFT: It's just scurrilous...

CLINTON: Look, I have been the target of so many ridiculous rumors that I have a great deal of sympathy for anybody who gets, you know, smeared with the kind of rumors that go on all the time.

Beyond clarifying that Barack Obama is not a Muslim, Kroft also painted a dire economic picture in Ohio, declaring that:

In the eight years that George Bush has been president, Ohio has lost more than 200,000 manufacturing jobs, and the state's median income has fallen by nearly 10 percent. It's being felt in the small cities that dot the Ohio landscape, and could very well decide the primary. Places like Chillicothe, a town of 22,000 people, an hour south of Columbus.

Later, Kroft explained that usual life of luxury for most Midwesterners was gone:

KROFT: Used to be that almost everybody in Ohio and the Midwest took a vacation to Florida, the west coast of Florida in the wintertime, and bought a new Chevy or a Ford or Chrysler every other year.

MIKE THRONE: The one that I have has 175,000 miles on it.

KROFT: Anybody take a vacation to Florida in the wintertime?

SCHOENHOLTZ: No.

JOHN ISON: I haven't taken a vacation in five years.

Here is the full transcript of the segment:

STEVE KROFT: On Tuesday, the Democrats will hold primaries in two big states, Texas and Ohio. The latter has long been a bellwether of American politics. No one has won the presidency without winning Ohio since John F. Kennedy did it nearly 50 years ago. If the Democrats had carried the state in the last two presidential elections, they would have won the White House. This week, Ohio voters will play a big part in determining who the Democratic nominee will be in 2008, and perhaps whether Hillary Clinton can keep her candidacy alive. We talked with Senator Clinton and Senator Barack Obama as we followed their campaigns in Ohio this past week. I know your husband has said and other people have said you've got to win these two states to stay in the race. Do you agree with that?

HILLARY CLINTON: Well, I intend to. I intend to do everything I can to win them. And we're doing well.

KROFT: Do you like your chances of winning one of the two big primaries that are next Tuesday?

BARACK OBAMA: I think we've got a good shot.

KROFT: There is no better place to find out than Ohio. It's the heartland of America, one of the big states in the middle of the country that has always grown the food and made the things that America needs, from auto parts, to soap and shampoo, to hamburgers. It stretches from the Great Lakes to the Ohio River, from Appalachia to the Plains of the Middle West. If Ohio were a country, it would have the 25th largest economy in the world, just behind the Netherlands. But today it reflects the problems and the challenges facing the United States and its middle class, in a world that's rapidly changing.

OBAMA: We are going to have trade agreements that make sense, not just for Wall Street, but for Main Street.

CLINTON: China's steel comes here, and our jobs go there.

KROFT: From Youngstown and Cleveland to Akron and Dayton, Obama and Clinton have crisscrossed a state that could put one of them in the White House. In the eight years that George Bush has been president, Ohio has lost more than 200,000 manufacturing jobs, and the state's median income has fallen by nearly 10 percent. It's being felt in the small cities that dot the Ohio landscape, and could very well decide the primary. Places like Chillicothe, a town of 22,000 people, an hour south of Columbus.

UNIDENTIFIED MAN: It is coming up on 8:00 here at 1490, WBEX Chillicothe.

KROFT: Chillicothe is a political microcosm of the state of Ohio. In the past two presidential elections, the voting patterns here have been virtually identical to the statewide results. George Bush and John Kerry campaigned for president here. So did Bill Clinton, Richard Nixon, Harry Truman, and Teddy Roosevelt.

KROFT: One reason may be that the politics here are unpredictable. Chillicothe has more independents than Republicans and Democrats combined, and all of them are eligible to vote on Tuesday. Is this town a mirror of Ohio?

STEVE MADRU: Actually, I think it's the mirror of not only Ohio but the whole country. You know, you have...

KROFT: Steve Madru is the Democratic chairman of Ross County.

UNIDENTIFIED WOMAN: So you're definitely voting on March 4th...

KROFT: And every evening he turns his real estate office in Chillicothe into the campaign headquarters for Senator Clinton.

WOMAN: The numbers are looking good.

KROFT: My sense of it is that a lot of the party establishment, a lot of the party machinery is behind Hillary.

MADRU: Yes, pretty much. I think it's, you know, Ted Strickland, our governor, is behind Hillary, and, you know, he's done such a great job in Ohio, and he's friends with the Clintons. And a lot of us have kind of followed along with the governor.

KROFT: A month ago, that organizational support had given Senator Clinton a 20 point lead in Ohio. But much of it has evaporated with 11 straight defeats, and the rise of a dedicated corps of Obama supporters who have been canvassing neighborhoods and taking their own informal street corner surveys by gauging how many people honk at their campaign signs. So you assume that people honking are people that like you?

UNIDENTIFIED MAN B: Well, when they give you a thumbs up, they like you. When they give you the finger, it's a thumbs down. So I'm pretty sure those are international symbols.

KROFT: Over the past eight years, there's been good cause for obscene gestures. Thompson Electronics packed up its plant and moved more than 500 jobs to China. And there have been layoffs at the Kenworth Truck factory and the Glatfelter Paper company, two of the town's biggest employers. Another paper plant, NewPage, is closing its facility by the end of the year.

KENNY SCHOENHOLTZ: Big change for our country.

KROFT: One of the people losing his job is Kenny Schoenholtz, who we invited to join a small cross-section of Chillicothe residents to talk about politics and the town's problems. Do you know what you're going to do?

SCHOENHOLTZ: I have no clue. Not at this time. Paper making is all I've knowed for 27 years. That's what my dad did for 41 years, and it's been my way of life. But I'll find something. I'll do something.

KROFT: What about health insurance?

SCHOENHOLTZ: That's another huge part in my life. I have a sick wife, MS, and I'm facing some huge expenses.

KROFT: But if you had to go out and buy private health insurance, could you afford it?

SCHOENHOLTZ: No, I couldn't afford it.

JOHN ISON: How they're going to fix that, I don't know.

KROFT: John Ison worked most of his adult life at the Thompson plant until it moved to China. He spent two years retraining himself in information technology and wound up with a lower-paying job at a local health care center.

ISON: The job that I'm working now, I make still a third less than what I was making for the last three years at my previous job.

KROFT: Anybody here better off now than they were four years ago? Ten years ago?

ISON: Four years ago?

JEFF ALLEN: Absolutely not.

ISON: I'm making my base pay now is what I was making in '91.

KROFT: Mike Throne has been the editor of the local newspaper for the past 10 years and has seen a lot of things change. Used to be that almost everybody in Ohio and the Midwest took a vacation to Florida, the west coast of Florida in the wintertime, and bought a new Chevy or a Ford or Chrysler every other year.

MIKE THRONE: The one that I have has 175,000 miles on it.

KROFT: Anybody take a vacation to Florida in the wintertime?

SCHOENHOLTZ: No.

ISON: I haven't taken a vacation in five years.

KROFT: We found them almost evenly divided on how they plan to vote on Tuesday. College student Katie Tuttle and Jeff Allen, a local union official, like Obama.

ALLEN: I'm leaning towards Barack. You know, they talk about the experience of Obama and I -- that's one of his shortcomings, is he doesn't have a lot of experience. But I think there's a lot of upside there.

KROFT: John Ison and City Councilwoman Queen Lester plan to vote for Hillary, partly out of nostalgia.

QUEEN LESTER: Her husband had the economy in much better shape when he was president than what we have today. So if he's an adviser in that area, I think we will do great.

KROFT: Both Clinton and Obama want to renegotiate NAFTA, give tax breaks to the middle class, and take them away from companies that send jobs overseas. But John Blind, a vice president at the Glatfelter Paper Company, one of the last big employers in Chillicothe that pays $20 an hour with full benefits, says that's not going to be enough to reverse the tide. What are your problems, specifically, with foreign competition in the paper business?

JOHN BLIND: They're paying their employees about one-fortieth of what we pay our employees. They do not have environmental regulations to deal with.

KROFT: How could the next president change that?

BLIND: It's going to take some courage to deal with this. I really believe so.

KROFT: And what unpopular decisions do you think need to be made?

BLIND: I think there needs to be some form of tariff to level that playing field.

KROFT: When we caught a few minutes with each of the Democratic candidates earlier in the week, we asked them about what John Blind had to say on tariffs, which are taxes placed on imports to make American products more competitive. His complaint about you, and his complaint about Senator Obama, both of you, is that you're sort of nibbling around the edges of trying to make improvements when to do all the things that you're talking about, there needs to be stronger action, bolder action, a more protectionist policy, tariffs.

CLINTON: We have to have a time-out on trade, which is what I've said I would do as president. We need to step back and say, 'Look, during the 19th century, we had tariffs when we were growing our economy. During the 20th century, open markets were to our advantage, because we were by far more productive.' Well, now we've got a new set of problems. I'm all for trade, but I don't want to be a patsy.

OBAMA: I don't think we can draw a moat around our economy. But what we do have to say is, 'We're going to drive a tough bargain. If you want access to our markets, you're going to have to open up yours.' Now, is that going to solve all our problems? No. But it's a good place to start.

KROFT: Senator Clinton said, you know, people forget that there have been certain times in our histories where we've had a much more protectionist policy, and it may be time for us to sit down and re-evaluate that situation again.

OBAMA: Mm-hmm. The problem with a time-out is the rest of the world's not taking a time out. I don't think we should be afraid of competition with the world. I think what we have to do is to be smart about competition in the world.

KROFT: But trade and jobs are not going to be the only issues for some voters in Tuesday's primary and in November. In Chillicothe, people told us that both race and gender would be hidden factors in southern Ohio, that many blue collar workers here won't vote for a woman, and others would never vote for a black. And Senator Obama has another problem: a malicious campaign against him that surfaced in a number of our interviews. Who are you going to vote for?

SCHOENHOLTZ: I'm leaning towards Obama. There's a couple issues with him I'm not too clear on.

KROFT: Which issues?

SCHOENHOLTZ: Well, I'm hearing he doesn't even know the national anthem. He wouldn't use the Holy Bible. He's got his own beliefs, with the Muslim beliefs. And couple of issues that bothers me at heart.

KROFT: You know that's not true.

SCHOENHOLTZ: No? I'm just -- this is what I've been told.

KROFT: One of the things that we found in southern Ohio -- not widespread, but something that popped up on our radar screen all the time, people talking about it, this idea that you're a Muslim.

OBAMA: Right. Did you correct them, Steve?

KROFT: I did correct them.

OBAMA: There you go.

KROFT: Where's it coming from?

OBAMA: You know, this has been a systematic e-mail smear campaign that's been going on since, actually very early in this campaign. Clearly, it's a deliberate effort by some group, or somebody, to generate this rumor. I have never been a Muslim, am not a Muslim. These e-mails are obviously not just offensive to me, somebody who's a devout Christian who's been going to the same church for the last 20 years, but it's also offensive to Muslims because it plays into, obviously, a certain fear-mongering there.

KROFT: It happened again last week when this photo of Obama, in ceremonial African tribal dress during a visit to Kenya, was featured prominently on the Internet and attributed to people in the Clinton campaign. Senator Clinton disavowed any knowledge of it. You don't believe that Senator Obama's a Muslim?

CLINTON: Of course not. I mean, that's -- you know, there is no basis for that. You know, I take him on the basis of what he says. And, you know, there isn't any reason to doubt that.

KROFT: And you said you'd take Senator Obama at his word that he's not a Muslim.

CLINTON: Right. Right.

KROFT: You don't believe that he's a Muslim or implying? Right.

CLINTON: No. No. Why would I? There's no, there is nothing to base that on, as far as I know.

KROFT: It's just scurrilous...

CLINTON: Look, I have been the target of so many ridiculous rumors that I have a great deal of sympathy for anybody who gets, you know, smeared with the kind of rumors that go on all the time.

KROFT: Her big leads in Ohio and Texas are both gone now, but she still has a chance of ending her losing streak and winning both states. There are a lot of people that think even if she manages to win both states by a small margin, and there's no difference in the delegates, that it's most likely impossible for her to catch you.

OBAMA: That's true.

KROFT: Is there a point where you say, `It's not in the interest of the party to continue this?'

CLINTON: No. No. You know, I am going to win, and I am going to go on.

KROFT: But you seem to be saying that as long as you think you have a chance to win, that you're going to stay in it, even if it goes to the convention?

CLINTON: Well, I don't think that will happen. But, you know, my husband didn't wrap up the nomination until June.

KROFT: We'll have Senator John McCain on '60 Minutes' next Sunday.

—Kyle Drennen is a news analyst at the Media Research Center.