"I'm happy today that we can say we're a couple of years into people just being absolutely fed up," Cuccinelli said. "And that's good thing in this circumstance. That's a good thing. Today, the idea of federalism is re-emerge as a way to reign in the excesses of Washington."

Cuccinelli, the outspoken Republican gubernatorial candidate, is best known nationally for spearheading a lawsuit against the federal government over President Obama's health care law. At CPAC, Cuccinelli called the measure "one of the greatest legislative invasions of liberty in the lifetime of anyone in this room."

He also chastised the Obama administration for recently mandating that certain religious organizations offer contraceptive service coverage in their insurance plans. He said the decision is "assaulting our religious institutions."

Beyond the health care legal tussle, Cuccinelli also touted another fight he picked with the federal government.

"Even before that health care lawsuit, that was two months into my term as AG; one month in, we sued the EPA, which I've taken to calling the employment prevention agency," Cuccinelli said.

Cuccinelli faces Lt. Gov. Bill Bolling in what is expected to be a heated GOP primary next year.

Cuccinelli received the "Defender of the Constitution Award," on Thursday.

In a statement, Ron Barber, Giffords's former district director, said he would put aside politics, as Giffords had done during her three terms in Congress.

"Our community needs someone who will put politics aside and solve problems for the people of Southern Arizona," Barber said in a statement announcing his candidacy. "My commitment is to be honest with the people of this district and help restore civility to our public life. My first priority won't be the next election -- but the next generation. That means balancing the budget the right way by protecting Social Security and Medicare, creating jobs, and securing our border."

Barber was shot in the face and leg in the January 2011 attack on Giffords at a constituent event in Tucson. The attack left six people dead and 19 injured.

Barber said Giffords and her husband, Mark Kelly, asked him to run in a special election to finish out her term. Giffords is expected to endorse Barber. Barber told reporters on a conference call Thursday that he hadn't decided whether to seek a full term under a newly-drawn map that makes the Tucson-based seat safer for Democrats.

"After much prayer, counsel with my family, and discussions with supporters, I have decided to end my campaign for the U.S. Senate, and continue to serve New Mexico as your Lt. Governor," Sanchez said in a statement on Thursday.

Sanchez has been running to the right of Wilson. His campaign has struggled to gain traction and his fundraising -- an early barometer of candidate momentum -- has lagged behind Wilson's pace.

Wilson was already the frontrunner in the GOP race. Sanchez's exit cements her position atop the field.

In 2008, Wilson was defeated in a nasty Senate primary by Rep. Steve Pearce, who mounted a campaign on Wilson's right that cast her as too far to the left.

"That didn't play into my decision," Lee told Hotline On Call in an interview on Thursday at day one of the Conservative Political Action Conference. "I had decided before I became aware of that ad that Clark Durant was the guy I was going to endorse in Michigan."

Lee said he has not even seen the ad, but has heard negative things about it.

"To be honest I haven't seen it," Lee said. "I've heard a lot about it. And one of the things I've heard about it was that it was produced by the same individual who generated the 'I'm not a witch' ad from Christine O'Donnell. ... I'm told that this lives up to the same reputation as that advertisement and that it is bad."

Fred Davis produced both Durant's Hoekstra's ad and the O'Donnell spot referenced by Lee.

Michigan was not the only Senate race Lee waded into on Thursday. He also endorsed Sarah Steelman in the Missouri Senate race. Steelman in an underdog who has struggled to raise money and gain traction in the GOP race.

"We're looking at Michigan," DeMint said when asked directly whether he was looking at the Senate race.

Former Rep. Pete Hoekstra is the frontrunner in Michigan's Republican race but Clark Durant is running to the right of the former House Intelligence Committee chairman.

DeMint's expression of interest in the race comes the same day that Utah Sen. Mike Lee, another conservative favorite, told Hotline On Call that he would be endorsing Durant.

Both Michigan Senate candidates released TV ads on Thursday.

"Congressman Pete Hoekstra claims to know a lot about China. Does he know the Chinese word for hypocrisy? Hoekstra attacks Debbie Stabenow for excessive spending. But like Stabenow, Hoekstra voted to increase the debt ceiling and spending by trillions of dollars," says the narrator of Durant's spot.

Durant's ad is a response to a controversial TV spot Hoekstra launched on Super Bowl Sunday, which casts Democratic Sen. Debbie Stabenow as a big spender and includes an Asian woman who uses a stereotyped broken-English accent. The ad has drawn much controversy since it aired.

Hoekstra released a second TV ad on Thursday that doubles down on his criticism of Stabenow's spending but this time, the only person who speaks in the ad is Hoekstra himself.

When asked for his reaction to Hoekstra's first ad, DeMint declined to comment.

Here's a bit more on the major congressional race ad buy from the Chamber of Commerce that we flagged in Hotline Sort this morning:

In total, the Chamber is targeting eight Senate races and 12 House races.

The Chamber is playing a lot of offense in the Senate, where the group is primarily running ads in states that represent strong GOP pickup opportunities. North Dakota, Montana and Missouri, three top pickup chances, are on the list, as are Hawaii, Virginia, Wisconsin and Ohio.

Ad anti-Kaine ad in Virginia slams former Democratic National Committee chairman Tim Kaine for his support for president's health care law. A pro-George Allen ad touts Allen's support for tax cuts.

The ads can be viewed here.

The Chamber is only defending one Senate Republican incumbent: Indiana's Richard Lugar, who finds himself in a pitched GOP primary against state Treasurer Richard Mourdock. "Lugar fights for energy jobs and America's energy security, even when a president gets in his way," the narrator of the pro-Lugar spot says.

The 12 House races the group is targeting includes 7 seats held by Republican freshman. Notably, the Chamber is supporting Democratic Rep. Jim Matheson in Utah's 4th District race.

The Wall Street Journal reported that $10 million is being spent on the ad campaign, overall. After the jump we have the full list of races the Chamber is targeting. In some cases, the Chamber will be running ads for the Republican candidates, in others, the ads target the Democratic candidate. In Virginia, for example, both types of ads will be running.

"Hopefully, we'll have four or five more" upcoming, DeMint said in a speech that kicked off the three-day Conservative Political Action Conference in Washington.

DeMint also touted the four Senate candidates -- Josh Mandel in Ohio, Ted Cruz in Texas, Mark Neumann in Wisconsin and Don Stenberg in Nebraska -- his political action committee has already endorsed, and urged the audience to support them.

Even the topic of the Super Bowl made it into DeMint's address, as he used the game to illustrate a point about working with Democrats in Washington.

"[The Giants] weren't cooperating with Tom Brady," DeMint said.

"The two teams had different goals; the Patriots were there to beat the Giants," he said.

"Compromise works well in this world when you have shared goals," he added. "We don't have shared goals with the Democrats."

8) CPAC kicks off this morning in Washington. Hotline On Call will be on-site, with dispatches and tidbits over the next three days. Check out the full speaking schedule here.

7) Former Kentucky Ag. Commissioner (and 2011 Lt. Gov. nominee) Richie Farmer has returned seven rifles to the state.

6) Anything you can do I can do better: Democrat Patrick Murphy announced that he is going to challenge Republican Rep. Allen West in Florida's new 18th District.

5) Rick Santorum said on Wednesday that he raised almost $1 million in 24 hours.

4) Republican Clark Durant will continue to hammer former Rep. Pete Hoekstra on Thursday over his controversial TV ad. He'll appear at a press conference with a county commissioner who is switching her support. More notable: He will also be unveiling a new TV ad, the subject of which has not yet been released. Stay tuned to Hotline On Call for more on this story later this morning.

3) That Sen. Debbie Stabenow, D-Mich., money bomb we brought to your attention earlier this week is up to $88,000 as of Wednesday afternoon. So the campaign has not yet reached its $144,000 goal.

"I haven't seen Rick Santorum so happy since they cancelled Will and Grace," Jay Leno joked about the former Pennsylvania Senator's victories.

"It was a big, big setback for the Mitt Romney campaign. Even the very poor said they felt bad for him," David Letterman quipped.

Don't miss today's Must See Moment at 1:41 when you can see what President Obama was really aiming for when he launched a marshmallow across the State Dining Room at the White House science fair:

A compromise on the issue could still be possible, an aide to the president has signaled. In the meantime, here's a closer look at how members of the president's own party running for the Senate in 2012 have been navigating the issue this week:

Former Democratic National Committee Chairman Tim Kaine:

The key Democratic break with Obama came from his close ally and former DNC chairman Tim Kaine, running for the Senate in a hotly-contested battleground. Kaine, whose Catholic devotion is a major part of his biography, said he favored additional religious exemptions for Catholic employers.

Here's what Kaine said in an interview taped on Tuesday with WHRV: "I think the White House made a good decision in including a mandate for contraception coverage in the Affordable Care Act insurance policy but I think they made a bad decision in not allowing a broad enough religious employer exemption. This is something that's been talked about a lot today and I have definitely expressed my grave concerns to the White House about that. I support the contraception mandate but there should be a religious employer exemption that is broader than the one they proposed."

Kaine isn't breaking with Obama on the decision to include contraception in the list of preventative services insurance companies need to cover; but he is rejecting the president's decision not to provide a broader exemption for religious organizations.

It's a notable break for a candidate who, for the most part, has stood with the president on most major decisions. It's also one of the clearest signs that the administration might have a made a political miscalculation with its decision. After all, it's not every day that a major Senate candidate in a key swing state Obama needs to win, who has stood with him on almost everything else, breaks with him.

Sen. Bob Casey, D-Pa.:

Casey, who opposes abortion rights, sent a letter to Obama last week urging him to "correct this decision."

Massachusetts may be thousands of miles away from Montana, but Democratic Sen. Jon Tester is proposing something strikingly similar to an agreement Elizabeth Warren and Massachusetts Sen. Scott Brown have struck, sending a letter to Republican Rep. Denny Rehberg on Wednesday that proposes curbing the influence of third party advertising in the Senate race.

And from a strategic perspective, Tester's proposal is a smart play.

"Let's reject and work to keep all third-party radio and TV ads about you and me out of Montana. Let's reject efforts by outside groups to undermine Montana's tradition of elections decided by people -- not corporations," Tester writes in the letter to his Republican challenger.

Despite the inability of candidates to coordinate with outside groups, the Massachusetts agreement imposes penalties; Tester also proposes fines in his letter.

"If a third-party organization that funds or broadcasts any TV or radio advertisement that specifically mentions or references either candidate, through narration text or messages, then the opposite candidate must pay a one-time penalty equal to the cost of the ad buy to the Montana charity of charities of the penalized candidate's choice. The penalty shall not be greater than $250,000 and must come from a candidate's campaign coffers," writes Tester.

While the similarities are hard to overlook, Tester said that he did not use the Bay State document as a model for his own proposal.

"To be honest with you, I've never read that agreement," he said on a conference call with reporters.

Rehberg's campaign was noncommittal. "This is certainly an interesting proposal by Senator Tester," said Erik Iverson, Rehberg's campaign manager. "We are going to give it a close look and we will respond in due course."

Strictly strategically speaking, Tester's proposal makes sense for three reasons.

First, both Democratic and Republican-aligned outside groups have played and are expected to continue to play in the Montana race, which is shaping up as one of the cycle's closest contests. That said, Republican-aligned outside groups have been dramatically outraising Democratic groups so far and were major force in the 2010 election cycle.

A major national ally of Wisconsin Gov. Scott Walker is dropping six figures in the Badger State on a significant TV ad buy meant to present the governor's controversial budget repair measure in a positive light in advance of a likely recall election.

The Americans For Prosperity Foundation, AFP's 501c3 sister origination, is spending $700,000 to air the ad -- which has run before in a smaller buy in Wisconsin the last few months -- this week along with a second ad next week, AFP spokesman Levi Russell confirmed.

The Plum Line first reported on the ad buy.

The next spot "will be a similar effort and a similar message," Russell said.

A careful response, if not a wholly surprising one, considering that as chairman of Hoekstra's party in the state, he's not in a position to give a much different answer.

The ad shows an Asian woman, using a fake accent, thanking Sen. Debbie Stabenow, D-Mich., for sending American jobs overseas.

"I was offended. I was stunned," the California Democrat said on CNN's Starting Point. "I couldn't believe that there would be somebody that would run such a violent, hateful ad."

Chu said the ad stereotyped Asian-Americans, and could lead to anti-Asian sentiments.

7) Rob Johnson, Rick Perry's presidential campaign manager, is now going to run a pro-David Dewhurst super PAC.

6) Good news out of Nevada for former Democratic Rep. Dina Titus: state Sen. Ruben Kihuen dropped his 1st District bid. Kihuen had been badly outmatched on the fundraising front.

5) Is it possible that New York City Comptroller John Liu has successfully weathered the controversy over financing of his 2009 campaign for his current position? Authorities continue to investigate whether Liu's campaign illegally used straw donors to bankroll his campaign three years ago, but a new Quinnipiac University poll out Wednesday shows a slight uptick in Liu's approval rating over the past two months. Forty percent of New York City voters approve of the job Liu is doing (up from 38 percent in December), while 29 percent disapprove (down from 35 percent). Despite the controversy, the embattled former Queens councilman insists he still intends to run for mayor, but the Quinnipiac poll shows other likely Democratic candidates -- City Council Speaker Christine Quinn and Public Advocate Bill de Blasio -- with better job-approval scores.

4) Rep. Marcy Kaptur, D-Ohio, is spending $90,000 to run a positive TV spot in the Cleveland area and has reserved even more time down the road. The Cleveland Plain-Dealer:

Kaptur is facing off against Democratic Rep. Dennis Kucinich in the 9th District. The primary is on March 6.