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Obama Pushes for Auto Industry Bailout; Interview With Former Social Secretary to Hillary Clinton

Aired November 11, 2008 - 17:00   ET


WOLF BLITZER, CNN ANCHOR: President Bush, in his first interview since the election, is now speaking out on his meeting with the president-elect, and he's looking ahead to the Barack Obama administration, looking back on his own administration. It's all in an exclusive interview with CNN's Heidi Collins. That's coming up in just a few moments.
But, first, Barack Obama making a push to help America's struggling automakers, and a push for another shot in the arm for the ailing economy -- new details on the president-elect's meeting with President Bush, even as Barack Obama lays the groundwork for his own administration.

Let's go to CNN's Jessica Yellin -- Jessica.

JESSICA YELLIN, CNN Capitol Hill CORRESPONDENT: Wolf, urgent aid for the auto industry was at the top of the list of priorities President-Elect Obama brought up in his meeting with President Bush yesterday. That's according to a senior Obama aide I spoke with earlier today, who also told me that Barack Obama pressed Bush on the need for a new economic stimulus package -- something President Bush has resisted so far.

In turn, we're told President Bush pressed Barack Obama on a priority that's important to him -- a new free trade deal with Colombia. You'll recall President Bush came into office promising to focus on relations essential in Latin America. And, clearly, he would like to see this pushed through before he leaves office.

Now, we are told by both sides there was no explicit tit for tat, no request for support with the free trade deal in exchange for support on an auto deal, for example. They say these were just different needs that the two men brought up in this important meeting.

Now, Congress is going to be addressing two of those issues next week -- both an economic stimulus package and a new proposal to help the car industry. That'll all happen in a special session of Congress. And we have yet to see where President Bush will come down on whatever Congress proposes.

Also, today, Wolf, we first heard from John Podesta, the man who is running Barack Obama's transition team. He tells us this new transition to power is going to cost $12 million. That's what they're spending on it. Four hundred people are employed in that transition and 100 of them have a special interim security clearance -- the first time we've seen this, part of the first post-9/11 transition to power. President Bush put this into effect, to make it a smooth and seamless transition on the security front, because of increased security needs in this time -- Wolf.

BLITZER: All right, Jessica.

Jessica's in Chicago, where Barack Obama is right now.

And now we're getting more information about that historic meeting yesterday in the Oval Office -- the president and the president-elect meeting.

I want to go to Heidi Collins.

She's in New York.

She had an exclusive interview with the president of the United States -- Heidi, in the last hour, we heard some moving words -- what he had to say about the troops. And I know you were with him aboard the USS Intrepid, this museum. And it is Veterans Day.

But you also had a chance to speak with him about the president- elect in these historic times. Tell our viewers what he said.

HEIDI COLLINS, CNN CORRESPONDENT: Well, he actually said a whole lot, Wolf. It was a really interesting interview and as you mentioned, the first interview since the election, and, in fact, the first interview since he did meet with President-Elect Obama.

Even though he was there to honor the troops today and he came in, landed on the deck of the Intrepid in Marine One for Veterans Day, we did talk about a lot of different topics. And I had a chance here now to ask him a little bit about what kind of advice he gave Barack Obama when they met at the White House yesterday.


GEORGE BUSH, PRESIDENT OF THE UNITED STATES: To the extent he asked my advice, you know I -- and he may want to ask it again. And the best way to make sure he feels comfortable asking it again is for me not to tell you in the first place what I advised him.

So we had a very private conversation. It was relaxed. It was interesting to watch a person who is getting ready to assume the office of the president. This will be a fantastic experience for he and his family.

I don't -- I mean he didn't need my advice about supporting the military. He knows he must do that. And we had a good conversation. I was very pleased.

And I remember the conversation I had with my predecessor, Bill Clinton. As a matter of fact, I called him yesterday and, you know, I said, Bill, I'm getting ready to meet with the new president and I remember how gracious you were to me and I hope I can be as gracious to President-Elect Obama as you were to me. COLLINS: In fact, you said you didn't have to do this.

BUSH: That's right. It was -- it was interesting yesterday. You know, one impression I can share you is that one of the things that President-Elect Obama was really interested in after we had our policy discussions was his little girls -- how would they like the White House. And it was interesting to watch him go upstairs. And he wanted to see where his little girls were going to sleep.

And, clearly, this guy is going to bring a great sense of family to the White House. And I hope Laura and I did the same thing. But I believe he will. And I know his girls are on his mind. And he wants to make sure that, first and foremost, he's a good dad.

And I think it's going to be -- I think it's going to be an important part of his presidency.

COLLINS: This is your first interview since the election.

BUSH: Yes, it is. It is.

COLLINS: So you know I'm going to ask you, how did you think that turned out?

What was your impression?

BUSH: Well, my choice didn't win. I was for John McCain. I felt he battled hard. But I meant what I said after the election, that the election of Barack Obama is an historic moment for our country.

There are a lot of people in America who did not believe they would ever see this day. And it is good for our country that people have hope in the system and feel vested in the future.

And so President-Elect Obama has a great opportunity. And I really do wish him all the best. I mean I am just as American as he is American. And it is good for our country that the president succeeds.

And so the transition that we're working with him on is a genuine effort to help him be able to deal with the pressures and the complicated issues of the presidency.

COLLINS: I imagine that you probably have a moment in your presidency that you are most proud of and a moment that I'm sure you most regret.

BUSH: You know I regret, saying some things I shouldn't have said.


BUSH: Like dead or alive and bring 'em on. You know, this -- and, by the way, my wife reminded me that, hey, as president of the United States, you'd better be careful what you say. I mean I was trying to convey a message. I probably could have conveyed it more artfully. You know, being on this ship reminds me of when I went to the USS Abraham Lincoln and they had a sign that said "mission accomplished." I regret that, you know, that sign was there. It was a sign aimed at the sailors on that ship. However, it conveyed a, you know, broader knowledge. To some, it said, well, Bush thinks the war in Iraq is over, when I didn't think that. But nevertheless, it conveyed the wrong message.

So there are things I've regretted. There are -- you know, I've had a lot of reasons to be, you know, proud, I guess is the right word. I'm proud every time I stand in front of the United States military. I am proud to be the commander-in-chief of people who are so selfless and so courageous that they would volunteer to serve our country in a time of war.

I'm proud when I see people feed the hungry. I'm proud when I'm in Africa and see volunteers helping citizens dying of HIV/AIDS. I'm proud to know there are young kids raising money to buy mosquito nets to help us defeat malaria on the continent of Africa.

I cannot tell you what an inspiring experience it's been to be the president of this country, because we're a nation full of generous, courageous, decent people.


BLITZER: And, Heidi, I guess you had a chance not only to speak to the president of the United States, you also spoke with some of his aides.

Take us behind-the-scenes a little bit and tell us what you're learning.

COLLINS: Sure. You know, they -- obviously, they were all there with him. And we've seen many of these people on television before. But it is interesting at this point, Wolf, because there's just two months left now in office. And certainly some things are winding down.

And behind-the-scenes, when you do talk to his staff, they, of course, speak very highly.

And you have to ask them, you know, what's next?

What are you going to do next?

And I will tell you that not many of them have a full plan at this point and very much are going to miss their jobs. They've said that it's the highlight, obviously, of their careers, as they know them so far. And it's going to be a tough, tough time for them, as they tell me.

BLITZER: Well, they can get some advice from a lot of other former White House officials who make that transition.


BLITZER: But there is a period of withdrawal. There's no doubt about that.

Heidi, good work.

Heidi Collins in New York for us today.

And I want to alert our viewers, the full interview will air tomorrow, 9:00 a.m. Eastern, in the "CNN NEWSROOM" with Heidi Collins. You're going to get a lot more then.

And we'll also be hearing later this hour from another leader, the former president of the United States, Jimmy Carter. He tells CNN that Barack Obama made him a personal promise about what he'll do in the very early days -- the first few days, in fact, of his administration. The interview with President Carter -- that's coming up, as well -- another CNN exclusive.

Let's go to Jack Cafferty right now because he's got The Cafferty File -- Jack.

CAFFERTY: The majority of Americans want change which, of course, explains the recent election results. But there is change and there's change.

And when it comes to our cars, we have a tough time with the concept of permanent change. We like to drive. Always have. We've got a long history of having relatively cheap gasoline.

But when gas prices hit all time highs this past summer -- four bucks a gallon and even higher in a lot of places -- many Americans were left with no choice. They had to cut back on their driving.

But a lot has changed since then. Oil prices are now hovering around 19-month lows and gas prices have dropped for 55 consecutive days. Forty-six states and the District of Colombia now reporting gas prices below $2.50 a gallon.

Now, that's the good news.

The bad news is there is mounting evidence we're getting back to our old ways -- climbing behind the wheel and driving more and more, the way we used to before gasoline got so expensive.

So what to do?

President-Elect Obama wants to cut greenhouse gas emissions when he gets to the White House in January. One way to do that is to put a hefty tax on gasoline -- big enough that it would force down consumption. That's our question -- should the government impose a gas tax aimed at holding down consumption?

Go to and you can post a comment on my blog -- Wolf.

BLITZER: You're going to get a lot of response to this question, Jack.

Thanks very much.

Well, one group in particular is very anxious about Barack Obama's election.


UNIDENTIFIED MALE: He says he's a friend to gun owners and his record is completely contrary to that.


BLITZER: Some gun enthusiasts are afraid Barack Obama may try to bring change that they don't want and they're taking action right now. They're buying large quantity of guns.

Also, what the Obamas heard and saw at the White House with the President and Mrs. Bush -- we have other new details coming up.

Plus, Barack Obama's fine line -- how does he bring about the change he's promising without appearing vindictive and angry?

Stay with us.



BLITZER: We're learning new details of yesterday's White House meeting between President Bush and President-Elect Obama -- some of it, as you just heard from President Bush himself, in that exclusive interview with Heidi Collins.

Let's go to our White House correspondent, Elaine Quijano -- Elaine, what else are you learning?

ELAINE QUIJANO, CNN CORRESPONDENT: Well, Wolf, it's interesting. In addition to the discussions on policy, yesterday was also about the personal and how a family can make the White House feel like home.


QUIJANO (voice-over): In an interview with Heidi Collins for CNN "NEWSROOM," President Bush shared his impressions of Barack Obama, the family man. Both are fathers to two girls who will have spent formative years in the White House spotlight.

BUSH: One of the things that President-Elect Obama was really interested in, after we had had our policy discussions, was his little girls -- how would they like the White House. And it was interesting to watch him go upstairs. And he wanted to see where his little girls were going to sleep. And, clearly, this guy is going to bring a great sense of family to the White House.

QUIJANO: That means making sure 10-year-old Malia and 7-year-old Sasha feel at home. As part of her visit with First Lady Laura Bush, Michelle Obama met the chief usher of the White House, Admiral Stephen Rochon, who asked for her preferences on meals, formality levels and more.

ANITA MCBRIDE, MRS. BUSH'S CHIEF OF STAFF: They were also asked, you know, if you want to make a selection of a particular swing set that the children -- that the girls might like and to let the usher's office know that and that will be purchased and it will be placed on the lawn.


QUIJANO: Anita McBride says Michelle Obama was also told about the superintendent of the White House grounds, Dale Haney, who has taken care of every presidential pet since 1976 and who would be in charge of taking care of the Obama's future first dog -- Wolf.

BLITZER: All right, Elaine.

Thanks very much.

Lots of interest in that dog.

We've learned that Michelle Obama's mom will be moving with the family to Washington, possibly into the White House itself, but she won't be the first presidential mother-in-law to do so.

Mamie Eisenhower is the mother on the right in this picture. She spent winter months at the executive mansion.

And Beth Truman's mother lived their full-time during her son-in- law, Harry Truman's, presidency.

We don't know yet whether Joe Biden's 91-year-old mother will be moving with him now to Washington. She currently lives with him in Delaware.

There's a pool house over at the vice president's residence, by the way, on Massachusetts Avenue, where Tipper Gore's mother lived while he was vice president of the United States.

Michelle Obama is an Ivy League-educated lawyer, a former public official and she's also the mother of two young children.

So what kind of role will she play as first lady?

Joining us now is Capricia Marshall, the former social secretary to the First Lady Hillary Clinton, when she was in the White House.

Capricia, thanks very much for coming in.


BLITZER: All right. Give us, publicly, some advice right now for the new incoming first lady. These are important decisions she has to make now that will set the tone for the next four years, maybe eight years. MARSHALL: Well, I think that she's on the right path. She has put family first. First and foremost, she's going to make sure that her young children transition into the White House the right way and that they're comfortable and that they feel secure in their new surroundings.


BLITZER: And picking a school is important, obviously, as well.

MARSHALL: Absolutely. Absolutely. But Washington, D.C. offers so many wonderful choices for them. I understand that she has already been out, that she has been looking -- scouting around. She's been asking many friends big questions on what she should...

BLITZER: Because when Hillary Clinton came, you know, she and Bill Clinton had Chelsea. She was a young girl and they had to worry about her schooling. They finally found Sidwell Friends for her, which is obviously a very elite private school here in the nation's capital.

We're also told that she's not necessarily, Michelle Obama, going to have an office in the East Wing.

What, if anything, does that mean?

MARSHALL: Well, I'm not sure. I think that my advice to her would be take it slow. You know, move into the White House, get your footing and then determine what you want to do. There's no reason for her to rush into making any decisions right now. She can take her time, get her family settled and then she can start making some choices.

BLITZER: Because at some point, she has to start worrying about what state dinners and sort of official or semiofficial functions, traditional functions of a first lady. And that's all rather complicated, albeit there's a great staff at the White House.

MARSHALL: Albeit there is. And they are wonderful. And they will make that family feel very much at home.

But there is a lot of waiting for her -- of course, state dinners and other ceremonial functions. She has a lot to do. There'll be a lot coming up very, very quickly.

BLITZER: Looking back on Hillary Clinton's adjustment from Arkansas to becoming first lady of the United States, there were some mistakes that were clearly made.

What does she need to avoid doing right now, Michelle Obama?

MARSHALL: Well, I'm not exactly sure what mistakes you're referring to, Wolf, because I think that she did it...

BLITZER: Well, that first year of the...

MARSHALL: ...quite perfectly. BLITZER: The first year of the administration, where there was some tension, some problems -- "Hillary Care," if you remember, those problems, for example.

MARSHALL: I thought that went really well.


MARSHALL: But anyway...

BLITZER: It didn't exactly work out.


MARSHALL: I think that -- you know, I have to say that Michelle Obama really should take a page out of Hillary's book.

BLITZER: For example?

MARSHALL: For example, with her children and that what Hillary did in the White House really made the family time sacred time. And that staff couldn't intercede at that family time during dinner or on vacations was really for the family. And I think that she's going to do that. I think that she's going to put up those boundaries.

And then the rest of the transition, as I said, that will come. Those decisions can come.

BLITZER: Because I think everybody recognizes -- every -- I was a White House correspondent in those days, as you well know, the media really protected Chelsea Clinton. She was a little girl and we stayed away from her.

How does the White House, how does the first lady -- the incoming first lady make sure these two sweet little girls who are about to come to the White House are protected from that -- you know, the public scrutiny, if you will?

MARSHALL: Well, again, I would -- I would actually refer to what Hillary did with Chelsea is, you know, set certain expectations. Give them a broad view of what might be coming. You know, have a family discussion. Role play as to, you know, what people might be saying and how you can react, because it's not only going to be good stuff all the time. But there may be some bad things that may come down the road.

So preparing them for what might happen, I think, would be a wise choice. And thereafter, surround them with good friends. Brig in lots of friends. Bring in some...

BLITZER: Young little kids into the White House?

MARSHALL: Absolutely. Fill it up with laughter.

BLITZER: Because these kids are going to have no trouble finding friends, I'm sure. MARSHALL: No, I'm sure they won't.

BLITZER: And -- but it's overwhelming -- I've got to -- it must be overwhelming for a first lady, all of a -- an incoming first lady to see what's going on.

MARSHALL: Absolutely. This transition in the next two months, I'm sure that they really wanted to go to bed and relax after this grueling campaign. But the next two months, they are on speed skates. There is so much to get done.

They have to determine how to pack the boxes out of Chicago, what goes into storage, what comes into the White House, how to prepare for the inaugural. There's so many steps involved in that.

And then, first steps walking into the White House. And I'm sure that Mrs. Obama was very surprised when she was handed her folder from the chief usher that said you need to start thinking about Christmas 2009.


BLITZER: All right. We'll leave it at that. And that's -- I remember those Christmases, all the Christmases that you helped organize and the decorations and the beautiful parties and all the thousands of people who come over for those receptions. It's a lot of work.

MARSHALL: It's a lot of work, but it's great fun and a magical place that's awaiting them.

BLITZER: They should hire you as a consultant.

You'd bring them some good advice, right?

MARSHALL: Well, I'm here to offer whatever assistance I possibly can.

BLITZER: I'm sure you are.

Capricia Marshall, thanks very much.

MARSHALL: Thank you, Wolf.

BLITZER: Barack Obama made a promise to Jimmy Carter -- the former president of the United States now telling CNN in an exclusive interview what the next president is vowing to do during the immediate early days of his administration.

Plus, the Senate race that still isn't over -- it's close, it's nasty, it's a political cliff hanger. We have new details right here in THE SITUATION ROOM.


BLITZER: Jimmy Carter, speaking exclusively with CNN. He says Barack Obama made a promise to him what he's going to do in his first few days in the White House. Stand by for that interview.

In the meantime, let's go to Zain.

She's monitoring some other important stories incoming into THE SITUATION ROOM right now -- Zain, what's the latest?

VERJEE: Wolf, a negative Christmas is how one analyst is describing holiday sales. The Small Business Optimism Index fell nearly 5.5 points in October, after many store owners said that they're liquidating inventories and laying off employees. The Dow sank on news that no business is immune from the lack of consumer spending. It closed down 176 points, or 2 percent.

The sporting event was supposed to promote peace. Instead, a suicide bomber hit a stadium in Northwest Pakistan home to Al Qaeda and Taliban militants. The bomb killed two and injured seven. Athletes from all over Pakistan were holding a closing ceremony inside the stadium.

He's not president yet, but Barack Obama is making promises to troops on this Veterans Day. Obama laid a wreath near Soldiers Field in Chicago and promised to keep a sacred trust, that America will serve them as well as they served the country.

With Obama was Tammy Duckworth, who lost both of her legs in Iraq.

Worldwide, this day is observed honoring troops from all wars. Here you can see observations from places like London, Belgium, Australia and France -- Wolf.

BLITZER: Zain, thank you.

The U.S. economy may be slowing, but business is booming for one industry.


UNIDENTIFIED MALE: I was here for Y2K, September 11th, Katrina and all those were the big events. And we did notice a spike in business, but nothing on the order of what we're seeing right now.


BLITZER: There's a run on guns. Sales are soaring across the country -- why many see a tie to Barack Obama and his incoming administration.

And it's one of the bigger challenges the president-elect will face -- how does he balance his agenda of change without appearing vindictive?

Plus, the election of the country's first African-American president some experts are predicting will change workplace dynamics across the country.

Stay with us.



BLITZER: To our viewers, you're in THE SITUATION ROOM.

Happening now, another result of this presidential election -- gun sales across the United States are up, way up. Americans are deeply worried about possible Second Amendment restrictions under an Obama presidency -- at least some Americans are.

Former President Jimmy Carter weighing in on President-Elect Obama's to-do list. He wants the next president to make the Israeli/Palestinian conflict his top priority.

And it's been a week, but the nasty race in Minnesota is by no means over. Democrat Al Franken and Republican Norm Coleman -- they're going to a recount for the Senate seat.

I'm Wolf Blitzer. You're in THE SITUATION ROOM.

Barack Obama's election victory has some gun owners and buyers up in arms. They're worried about possible gun control legislation and as a result, some merchants say the gun business has never been better.

Let's go to our justice correspondent, Kelli Arena.


KELLI ARENA, CNN JUSTICE CORRESPONDENT: Wolf, across the nation, shop owners say that sales have been incredibly brisk. We went out to talk to folks to see why they're rushing to buy. It turns out many of them are afraid of losing their rights.


ARENA: Barack Obama won. And Kyle Lewandowski bought a gun.

KYLE LEWANDOWSKI, GUN BUYER: Every election year you have to worry about your rights being eroded away a little bit at a time.

ARENA: The Virginia resident is worried that an Obama administration and a Democrat controlled congress will pass tough new gun laws. And he is not alone.

BERNIE CONATSER, GUN SHOP OWNER: I was here for y 2 k, September 11th, Katrina. All those were big events. We did notice a spike in business. But nothing on the order of what we're seeing right now.

ARENA: In the days following the election, gun sales went through the roof. Background checks for gun purchases shot up nearly 49 percent from the same time last year.

UNIDENTIFIED MALE: He says he's a friend to gun owners and his record is completely contrary to that.

UNIDENTIFIED MALE: They don't want the average American to have the right to defend themselves.

ARENA: During the campaign, the NRA warned that Obama would be the biggest anti-gun president in American history. This is what Obama has said.

SEN. BARACK OBAMA (D), PRESIDENT ELECT: I believe that the second amendment means something. I do think that it speaks to an individual right.

ARENA: What exactly are his policies? Well, Obama wants to revise and make permanent the ban on assault weapons. He supports a national ban on concealed weapons. And Obama supports the rights of local governments to set their own gun laws. But the Obama team says gun control is not high on its list of priorities and that it's focusing on things like the economy and health care. Still, people like Kyle Lewandowski aren't taking any chances.

LEWANDOWSKI: Maybe into the second year, I mean, Clinton didn't do anything until his second year in office.


ARENA: Gun advocates fear even if the Obama team doesn't mess with gun rights it may hurt them in other ways like raising taxes on things like ammunition. The president-elect hasn't said he'd do that but many gun owners aren't convinced. Wolf?

BLITZER: Thanks very much for that.

Let's get some more on this transition to power. For that we're joined by Democratic strategist Steve McMahon and Republican strategist and CNN political contributor Leslie Sanchez. Guys, thanks very much for coming in.


BLITZER: You heard Kelli Arena's report that a lot of these gun owners are deeply worried right now. This is the delicate balance that the president-elect has to go through. How vindictive, if you will, payback time to the Republicans as opposed to trying to forge some new consensus. It's not easy right now because there are some liberals out there who say, you know what, the Republicans had it for eight years. Now it's time for us to basically have it.

MCMAHON: Yeah. I think there is a little bit of pent up demand on the Democratic side to move things quickly, some things that might be very controversial. I think Senator Obama is interested in setting a new tone. Valerie Jarrett was on a show over the weekend where she said people will be surprised how much of a pragmatist Barack Obama is. I think that's probably right. I know Rahm Emanuel who I've known for a long, long time is very much a pragmatist. He pushed everything from President Clinton's welfare reform bill to the crime bill and worked on a wide range of issues. This is not a white house that's being taken over by the left. On the other hand there's no question that organized labor and a lot of Democrats were responsible for Barack Obama being there both as a nominee and president-elect.

LESLIE SANCHEZ, REPUBLICAN STRATEGIST: That's probably the most interesting part. You're hearing about a big public works initiative and other bailouts. I think a lot of folks are concerned about provisions the union will have. I mean why don't we undate (ph) some of the provisions that call for minimum wage so that non-union companies can be competitive and that's probably better government overall. I think overall Senator Obama, now President-Elect Obama has been magnanimous. He's put heavy hitters around him. He'll probably play good cop while they play bad cop.

BLITZER: Go ahead.

MCMAHON: It's very pragmatic. He's a pragmatic guy. He's a tough operator. But he's not a doctrine liberal. He's interested in getting results just as President-Elect Obama has said he is. People are going to be surprised. He promised a new tone in Washington. One of the reasons he carried ten or twelve states that Senator Kerry wasn't able to carry is because he didn't just promise; he appeared like he was going to bring a new kind of politics to Washington. He's got a lot invested and I think he's going to deliver.

BLITZER: Go ahead.

SANCHEZ: It's true. The olive branch to Senator Lieberman is definitely a sign. People are very cautious in Washington is he going to be somebody who --

BLITZER: Speaking of Lieberman, Steve, do you think they should let him caucus, continue to caucus with the Democrats and remain chairman of the Homeland Security Committee?

MCMAHON: I think whether or not he remains chairman of the Homeland Security Committee is an issue Senator Reid and the Democratic caucus will have to deal with. He does in fact vote with the Democrats on almost every issue with the exception of Iraq. So I think on the whole, Senator Lieberman has been a Democratic senator. He got a little out of his lane in the primaries and certainly at the convention when he was criticizing President-Elect Obama.

BLITZER: You want him to stay as part of the Democratic majority.

MCMAHON: They're closer to 60 with him there than not there.

SANCHEZ: Those are the challenges with conservative Democrats. Not only the number but the composition of individuals.

BLITZER: What do you think Lieberman's going to do and what do you think the Democrats will do?

SANCHEZ: I can't predict that. They'd be smart to know there's a mandate that people want effective government. To that extent I think many Republicans, independents, all of us want to see Obama succeed because it's important economically and for our security.

BLITZER: Steve, what's the proper approach that Barack Obama should be doing now in terms of trying to squeeze or influence the current president about helping the auto industry? He is the president-elect. He's not the president. But he still is a United States senator.

MCMAHON: He's still a United States senator. I think what he did or what he apparently did yesterday by basically suggesting an outcome he would like to see, even though he's not the president yet, he simply the president-elect. I think you know he wants control of the bailout package so it's not tilted so much in favor of Wall Street and big banks, it's tilted more in favor of people who actually need help. There are a lot of auto workers who depend on GM and Ford and companies like that surviving. Health care benefits depend upon it. I think he'd like to see the auto industry get at least as much help as Wall Street has gotten.

BLITZER: Very quickly.

SANCHEZ: I think it has to be done but there's a question to when do the bailouts end.

BLITZER: That was very quick. Thanks guys very much.

They made the election a family affair.

JIMMY CARTER, FMR. PRESIDENT: There are 26 voters in our family who are descendants including those two. Obama got 26 votes.

BLITZER: Former President Jimmy Carter speaking to CNN, speaking about what he hopes President-Elect Barack Obama will deliver in return.

It may be the nation's nastiest senate race and it's also the closest. Why it's far from over right now.

Stay with us. You're in THE SITUATION ROOM.


BLITZER: The former president of the United States, Jimmy Carter, did not deliver a formal endorsement during the Democratic primaries. But he made it clear he favored Barack Obama. Now the man who brokered the first Arab/Israeli peace deal wants Barack Obama to make the Middle East a top priority even as America is rocked by an economic crisis. Jimmy Carter spoke exclusively with CNN's Octavia Nasr.


CARTER: On a personal note, there are 26 voters in our family who are descendants of me and Rosa. Obama got 26 votes. We were for Obama. We're very thrilled that he has been elected. One of the reasons that we have been pleased with his election, he promised to me personally and also to the public that he will not wait even a month after he is president to start working on the peace process. Whereas, as you know, the previous two presidents, they waited until the last year of their eight years in office before they began the peace process. So I think to start early on when the newly elected president has a maximum amount of influence and popularity and so forth to deal with this very difficult question is a very good move. That's one reason that I'm very thrilled that -- and expect that there'll be a new approach brought, a new stimulus brought to the peace process in the Middle East when Obama is the president.

OCTAVIA NASR, CNN CORRESPONDENT: But also he saves an economic crisis of huge proportion. Some people say it will be unwise to deal with anything other than the issues in this country first, the economy and -- and the crisis, jobs are being lost, people losing their homes, and that would be a priority, that he shouldn't be focusing on anything else.

CARTER: I don't agree with that. When I was elected we had a horrible crises in the world. We were involved in the cold war where nuclear annihilation was threatened on both sides. We had had four wars in 25 years in the Middle East with Egypt being the main adversary for Israel. We had a much worse energy crisis then than we have now. We had original and secondary boycotts against Americans by the Arab OPEC nations and so forth. I can go down the whole list. And we still found time and the interest and the commitment to deal with all of those questions, economic and otherwise, as well as peace in the Middle East. Which I think is a very important issue. I don't have any doubt in my mind that to find peace and security of the human rights for the Palestinians and also for Israel would be a major factor in reducing the threat of terrorism. I think that disturbance and that lack of progress in the Middle East is one of the main causes for animosity and hatred and even violent acts against America and our allies. I think it's certainly not incompatible to work on the energy question, to work on, say, health care, to work on the troubled economy, as well as to work on peace in the Middle East. They're not incompatible and all of them can be done by a new president from the first day he's in office.


BLITZER: During his own term, President Carter struggled with an economy marked by double digit inflation, high unemployment. One note for the record, though, in the first year of the Clinton administration, back in 1993, Bill Clinton September of that year did host that historic white house meeting between the then prime minister of Israel and the Yasser Arafat. He brought them together for the agreement signed in '94. Bill Clinton was involved in the first Israeli/Jordanian peace treaty. He helped sign and work out that peace treaty between Israel and Jordan. Jimmy carter wasn't exactly precise in saying Bill Clinton waited until his last year to try to do something about the Arab/Israeli conflict. We're going to be speaking with Jimmy Carter hopefully in the next few weeks. We'll talk about that and a lot more.

Meanwhile, it may have been the nastiest political race of this election year. But a week after Election Day it is by no means over. And it won't be for a while. The Minnesota senate contest is now headed for a recount. Brian Todd has been looking into this extraordinarily close race. What are you picking up?

BRIAN TODD, CNN CORRESPONDENT: This one's on a razor's edge. This may be a long shot but the Democrats still have a chance to get the filibuster proof 60-seat majority in the senate. Three senate races in Georgia, Alaska, and Minnesota are still up in the air. And in Minnesota the candidates are separated by just a sliver of space.


TODD: They've taken Minnesota's reputation for civil politics and dumped it on its ear. Now the competitive senate race between incumbent Republican Norm Coleman and comedian turned candidate Al Franken is headed toward extra innings, despite the fact that Coleman's declared victory twice.

SEN. NORM COLEMAN (R), MINNESOTA: Yesterday the voters spoke. We prevailed.

TODD: That was November 5th when Coleman's lead was 725 votes. The latest tally from the Minnesota secretary of state's office has Coleman ahead by just 206 votes and we're headed to a recount that'll begin next week.

PROF. LARRY JACOBS, UNIV. OF MINNESOTA: It is quite possible that the Minnesota senate race will not be settled by the beginning of the 2009 new session in congress.

TODD: Nearly 3 million votes cast. All on paper ballots. Now have to be examined by hand. They include about 25,000 ballots where votes for president were cast, but not votes for senate. Observers say most of those votes were in Democratic counties with many first- time voters, so the markings will have to be checked very carefully. It adds to the intrigue of a race characterized by both candidates calling each other misleading and this add from Coleman's side showing Franken's less than senatorial moments.

AL FRANKEN: You are wrong and you have to apologize, ma'am. How [ bleep ] shameless these people are. These people are so [ bleep ] shameless.

TODD: A spot that brought so much backlash, Coleman had to promise a more positive campaign. Why is this race so personal? One analyst says it harkens back to when Coleman won the seat held by the late Democratic Senator Paul Wellstone.

JACOBS: This is almost a blood vendetta. Al Franken was good friends with Wellstone who died in a plane crash only about 10 days before Election Day back in 2002. Al Franken has dropped his career as a comedian to move back to Minnesota to run this race.


TODD: Like any recount, battle lines are already being drawn. In Minnesota there are questions about possible fraud from Coleman's side which Franken's people deny and lawyers for both sides gearing up for this recount. It could get nasty.

BLITZER: As you know there's a Republican governor but the state lately has been pretty Democratic.

TODD: That's right. It's playing into this. The secretary of state himself is a Democrat. It's a heavily Democratic state. The Coleman people are ready to pounce if they see anything hinting of partisanship. The secretary of state himself told me no way is it going to creep into that. Minnesota actually has a good reputation for having clean recounts in these things. They've got three other recounts going on now for statewide races.

BLITZER: Close elections. All right. Frank, thanks very much.

Governor Sarah Palin talks about the next presidential election. You're going to be hearing what she says about running potentially for president in 2012.

Obama's plan to move troops out of Iraq into Afghanistan. What the people who fought in those wars think about it.

Stay with us. You're in THE SITUATION ROOM.


BLITZER: As we await Barack Obama, he is now the president- elect. He is going to be the president of the United States. There is no doubt that a lot of U.S. military personnel are waiting and watching to see what is going on. But there is one special group of troops that have a special interest in what is going on right now. Let's go to Chris Lawrence, who is joining us live now from San Diego.

That group, some really patriotic Americans. Chris, tell us what you have discovered.

CHRIS LAWRENCE, CNN CORRESPONDENT: That is right, Wolf. More than 100 permanent legal residents with green cards who have been serving in the U.S. military but only today got sworn in as citizens. Now they were not eligible to vote until today, but they have been paying close attention to what candidate Obama said about the military, and now they are speculating about where he may deploy them as president.


LAWRENCE: They have served America, and they are now Americans.

UNIDENTIFIED MALE: You are an inspiration for all of us.

LAWRENCE: More than 100 service members sworn in. Legal residents, now U.S. citizens.


LAWRENCE: Marine Sergeant Henry Maldonado came here legally as a teenager from Mexico. He's done three tours in Iraq and been awarded two purple hearts. Four years ago in Fallujah he was one of the few survivors when a car bomb detonated next to his truck.

SGT. HENRY MALDONADO, U.S. MARINE CORPS: Post traumatic amnesia where you don't remember getting on the truck or being on the truck or pain or no nothing.

LAWRENCE: With Obama taking office in January, do you think you will deploy back to Iraq again?

MALDONADO: With him in command, probably not.

LAWRENCE: Maldonado thinks that Obama will send marines to Afghanistan.

MALDONADO: Him being elected kind of puts it in a reassures that we will shift over there. Because McCain, it was kind of more of iffy.

LAWRENCE: He has heard Obama say, quote, the scale of the deployments in Iraq sets back our ability to fight in Afghanistan. Maldonado says that a lot of the marines would welcome a deployment there.

MALDONADO: We have done a lot more people in Iraq. There's a fight going on in Afghanistan. There's marines and army guys getting whooped over there.

LAWRENCE: Maldonado says by January his marines will start throwing money in a pot betting on when they're deployed. Wherever he goes, it will be as a U.S. citizen.

MALDONADO: I'm officially here. This is my home now and I'm not just renting.


LAWRENCE: No he, is not. He came from Venezuela to Vietnam and Egypt and Kenya and other nations. So it illustrates the diversity of the troops.


BLITZER: Chris Lawrence, a very powerful story. Thank you, Chris. Congratulations to all of the troops.

Let's go back to Jack. He's got the Cafferty file. Jack?

JACK CAFFERTY, CNN CORRESPONDENT: The question this hour is should the government impose a gasoline tax aimed at holding down consumption?

David says, "Definitely, but only if it is the money is set aside for developing alternative energy sources and the poor receive rebates. However, I'm afraid the vultures in Washington would pick it dry like they've been doing to social security. Mexicans pay $3 a gallon. I think the Americans can handle it as well." Mark in Arizona, "Whole-heartedly I agree. You car owners are the most spoiled and wasteful people I know. No one is going to take the high road and make the necessary sacrifices unless they are forced to. But don't jack it up too high. I like having the bus mostly to myself."

Jim in Fort Collins, Colorado, "It doesn't make sense to pour billions into the auto industry to save jobs then turn around and penalize people who buy cars and drive rather taking the bus."

Jim in New Hampshire, "We should raise the gas tax, ideally indexing it to the price of oil to create a price floor. It would ensure a change in driving behavior, hasten the development/purchase of fuel efficient vehicles and provide funding for repairs to bridges and roads."

Ballanor in Dallas, Texas, "A gas tax is regressive. The citizens who live in poverty would pay the same gas tax as the rich folk in gated communities. Should a struggling single mother with 3 kids pay the same gas tax as Oprah Winfrey and Dick Cheney?"

And Terry in North Carolina, "Stop putting the ideas on the screen, because some of the lawmakers might watch the Cafferty file along with five other people and propose an idea. We are struggling enough, let's leave it alone."

If you didn't see your email here, you can go to my blog at and look for yours there among the other five.

BLITZER: Mia. All right. Jack, thanks very much.

The Barack Obama team is the most diverse as everybody, so will corporate America take note?

Plus, Sarah Palin's media tours. The vice presidential nominee laying the groundwork for a presidential run in 2012?


BLITZER: The insurance company AIG is on the defensive again after another report says that the company was holding a meeting at a posh resort while they were restructuring the bailout plan by the government. Lou is keeping an eye on all of this.

So what is going on, Lou? What are you discovering?

LOU DOBBS, CNN ANCHOR: Well, AIG again this time trying to disguise the executive conference out in phoenix, Arizona, at another posh resort spending over $300,000 again. But trying to keep it secret, Wolf, and denying at the same time there is any problem and saying that they are going to have sponsorship. Elijah Cummings a congressman is calling for resignation of the CEO of AIG, because this is now the third time in which this has happened. The first time they were wrongly criticize and the second time, they decided to cancel it, and now the third time, they sided to disguise what they were doing and this from a company that has just received approval for another $40 billion on top of the $123 billion authorization for a bailout they had received earlier. This is outrageous behavior on a part of a corporation, and Hank Greenberg, the previous CEO, he is outraged as well.

BLITZER: Well, Lou will have more on this story coming up in one hour. Lou, thank you.

DOBBS: You bet.