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Interview With Carlos Gutierrez; Interview With Ted Turner

Aired November 16, 2008 - 11:00   ET


WOLF BLITZER, HOST: This is LATE EDITION, the last word in Sunday talk.

PRESIDENT GEORGE W. BUSH: We share a determination to fix the problems that led to this turmoil.

BLITZER: The world's leaders meet in Washington to try to head off a global financial meltdown. What did they accomplish? We'll ask U.S. Commerce Secretary Carlos Gutierrez.

America's big three automakers on the verge of collapse. Will Congress bail them out? Democratic Congressman Charlie Rangel and Republican Congresswoman Marsha Blackburn weigh in.

PALIN: I just don't want to close any doors at this point.

BLITZER: In a wide-ranging interview, former vice presidential candidate Sarah Palin discusses the economic crisis, Barack Obama and her own political future.

SEN. HILLARY RODHAM CLINTON, D-N.Y.: I'm going to respect his process and any inquiries should be directed to his transition team.

BLITZER: Will Hillary Clinton be Barack Obama's secretary of state? Insight and analysis from James Carville, Ed Rollins and the best political team on television.

TURNER: The best way out of the financial mess that we're in is to put our shoulders to the grind stone.

BLITZER: CNN founder Ted Turner discusses the economic crisis, Barack Obama's election and his own book "Call Me Ted."

The first hour of LATE EDITION begins right now.


BLITZER: It's 11:00 a.m. here in Washington, 8:00 a.m. in Los Angeles and 6:00 p.m. in Baghdad. Wherever you're watching from around the world, thanks very much for joining us for LATE EDITION. The leaders of 20 nations met here in Washington this weekend to try to craft a plan to address the global financial crisis. The U.S. economy, meanwhile, continues its slide with the very real prospect of a collapse of America's auto industry. Let's talk about all of this and more with the U.S. Commerce Secretary Carlos Gutierrez. Mr. Secretary, thanks very much for coming in. Want to get to the auto industry in a moment because I think there's some developing headlines coming out of what you're about to tell us. Let me ask you if there was any immediate achievement resulting from the summit yesterday, 20 leaders gathering with President Bush here in Washington, that will have an instant or immediate impact in turning things around as far as the U.S. economy is concerned.

GUTIERREZ: I think the important thing is the leaders of G-20 coming together and agreeing on a longer term agenda. One meeting is not going to solve the whole global situation, but they did agree on principles, they agreed on future meetings. They agreed on a process. I think that's a very important step forward.

BLITZER: But nothing immediate that they decided yesterday that next week, the week after, maybe within three weeks, even a month is going to have an impact.

GUTIERREZ: Well they agreed on a future meeting. They agreed on key principles.

BLITZER: But future meeting isn't going to be until March or April or whenever.

GUTIERREZ: Right. But very importantly too is this principle that we're here not to strengthen our free market capital system, not to change it. And people shouldn't get confused as to what we're going to do and I think that's a very important principle.

BLITZER: The Europeans, Led by the French President Sarkozy, they want greater oversight, transparency. They want more international regulation and they want a limit on executive pay. Is the Bush administration, the U.S. onboard?

GUTIERREZ: Well, there is an inclination, when you get into problems like this to go to an extreme, to over regulate, to think that we're going to have a worldwide compensation system. How is that going to be done? I think we have to be careful, we have to find a balance and we can't over regulate so that five years from now we're trying to claw our way back because we overdid it.

BLITZER: So that's the biggest difference with the Europeans right now would you say?

GUTIERREZ: Well, I think that's a conceptual point that I'm sure President Bush made the other day in New York, that we have to, we have to find balance and we have to find the wisdom to not get carried away.

BLITZER: Let's talk about the auto industry. The big three auto manufacturers in the United States, Ford, GM and Chrysler, they're on the verge, potentially of collapse right now. Does President Bush support a federal bailout, U.S. taxpayer dollars to keep these auto industry, these auto manufacturers alive? GUTIERREZ: Let me tell you what we support and what we don't support. First of all, we do not support opening up the financial rescue package.

BLITZER: The $700 billion --

GUTIERREZ: The $700 billion package for the auto industry.

BLITZER: So none of that money should be used to help the auto industry?


BLITZER: Is that right? None of that money.

GUTIERREZ: None of that. If you start that, where do you stop? There's a line of companies of industries waiting at Treasury just to see if they can get their hands on those $700 billion. That is for the financial system, it's to stabilize the financial system and that should not be used.

What we are proposing, we have a solution and 2007 energy bill, there is a section, section 136 that made available, $25 billion of loans for the auto industry so that they can retool for cars of the future, for fuel efficiency initiatives.

That bill, that section can be reworded quite readily and that money can be made available to auto companies. That can prove that they are viable or that they have a plan for viability.

BLITZER: So what you're saying is the money is there, but Congress needs to pass legislation to reauthorize it to be used to prop up the auto industry.

GUTIERREZ: It needs to be amended and that can be done very quickly.

BLITZER: This week you think it could be done?

GUTIERREZ: That should be done this week.

BLITZER: This week?


BLITZER: Because, as you know, a lot of Republicans oppose any taxpayer dollars being used to bailout the auto industry. I'm going to play this little clip, Chris Dodd, the chairman of the Senate Banking Committee, he made this point, listen to this.


SEN. CHRISTOPHER J. DODD, D-CONN.: Right now, I don't think the votes, I don't know if a single Republican is willing to support, so I want to be careful about bringing up a proposition that might fail. (END VIDEO CLIP) BLITZER: And Richard Shelby, who is the ranking Republican, Mr. Secretary, on the Senate Banking Committee he said this this morning. Listen to this.


SEN. RICHARD C. SHELBY, R-ALA.: I think it's a mistake. They would be in a lot of people's judgment, a lot better off to go through chapter 11 where they could reorganize, get rid of the management. Get rid of the boards. The people who brought them to where they are today. This is a dead end. It's a road to nowhere and it's a big burden on the American taxpayer.


BLITZER: Are you with Shelby on this one?

GUTIERREZ: What we're saying is look, it's already part of the law. The Congress made available $25 billion for the auto industry. So, let's use that legislation instead of going into the rescue package.

BLITZER: But that money was supposed to be used to clean up, in effect, to make it more energy efficient or green if you see, building better engines, less environmentally pollution oriented engines.

GUTIERREZ: And we believe that as part of whatever package is approved, that companies should commit to investigating in green technologies. But if we don't take care of the short term, there is no green future. They also have to commit to either demonstrate that they are viable or commit to a plan that makes them viable.

BLITZER: So let's spell out. What conditions, if you had your way, the Bush administration's way, what do the big three automakers have to do to be worthy of that $25 billion that's potentially out there that you would support giving them?

GUTIERREZ: Well, first of all, the legislation does talk about technology and green technologies and --

BLITZER: So they have to commit to that.

GUTIERREZ: Commit, have a plan to invest in that in the future. In the short term, in the immediate term, they have to demonstrate that they have a plan to become viable, either they are viable or they have a plan to become viable. Then there will be taxpayer protections, which would be negotiated with Congress and the Senate will work this out.

But the important thing is, why would the American taxpayer want to invest in a company that is not viable? So, the viability aspect of this is very important.

BLITZER: Because there's a lot of critics out there saying, you know what, you put in these billions into the big three American automakers, it's sending good money after bad. GUTIERREZ: That's why the viability aspect is so important because you wouldn't want to put money into an enterprise that isn't viable. So they need to demonstrate that they have a plan, a way forward to make their companies viable.

BLITZER: How bad off is the U.S. economy right now? Put some numbers up on the screen for you. Retail and food sales service, you're the commerce secretary -- back in July went down, well, 0.1 percent. August 0.3 percent, September minus 1.2 percent. In October, 2.8 percent drop. That's the worst drop since 1992. This is not going in the right direction.

GUTIERREZ: Yeah, there's no question. We are going through a difficult time. Unemployment is up 6.5. The consumer purchases and retail sales is a direct reflection of the lack of credit. Our economy functions on the basis of credit -- 70 percent of our economy is consumer spending. A big part of consumer spending is done on credit. That's why Secretary Paulson mentioned the three areas of focus of the $700 billion rescue package. One part of course is capital restoration in banks. The other part is consumer credit. We need to restore the ability to use credit cards, to buy a car, to buy furniture, and for small businesses to expand. So really, credit is at the heart of what we need to do to be able to grow and create jobs.

GUTIERREZ: The important thing is we need to restore viability and vitality to our private sector, because that's where we create jobs.

BLITZER: Carlos Gutierrez, the commerce secretary, thanks for coming in.

GUTIERREZ: Thank you.

BLITZER: And good luck.

Just ahead, the CNN founder, Ted Turner. We'll get his take on this economic crisis, as well as -- we'll talk about his new book, "Call Me Ted." You're going to want to see this.

And later, my wide-ranging interview with the vice presidential candidate, Governor Sarah Palin. A lot more coming up, right here on "Late Edition." We'll be right back.


BLITZER: Coming up later, James Carville and Ed Rollins -- they're standing by live. We'll talk about Sarah Palin's political future and Hillary Clinton's future, as well, possibly as the secretary of state. They're coming up.

But right now, joining us from the -- from Atlanta, not the CNN Center, but in Atlanta, his hometown, with his take on where everything is going right now, is the CNN founder, Ted Turner.

He's the author of a brand-new book entitled "Call Me Ted." It's an autobiography, an important read if you want to know what's going on in the history of the past 50 years or so.

Ted, thanks very much for coming in.

TURNER: It's good to be here.

BLITZER: Let me get your immediate reaction, before we get to the book, Ted. We just heard the news from the commerce secretary, Carlos Gutierrez, saying the Bush administration would support $25 billion to rescue, if you will, to bail out the Big Three U.S. auto companies, to reprogram, reauthorize some existing funds in the energy bill to make it possible for Chrysler, Ford, and GM to survive.

Is this a smart use of taxpayer money? TURNER: Well, I -- I didn't actually see the announcement, but you told me about it. I'm just -- I don't like to see these bailouts, and particularly of big industry.

And, on top of that, who's to think that $25 billion is going to bail them out. That will probably last until March and then they'll be back for some more. Their problems aren't going to go away any time soon. They've just been building the wrong kind of cars for a long time.

BLITZER: So you're saying that it might be -- I mean, the economy would clearly suffer and the economic crisis would deteriorate if GM, for example, would go down. Think of all those jobs that were lost in the...


TURNER: Well, remember, it's not -- it's not going down. It's going into Chapter 11. And, you know, we don't know what would happen if they go into Chapter 11. But not everybody would be let go. They'd maintain operations, I believe.

BLITZER: Who's to blame -- who's to blame, Ted, for this current economic crisis in the United States?

TURNER: All of us. Because we spent more money, for years, than we made. And you can do that for a while, but you can't do it forever. And all of a sudden, it's become time to pay the piper.

We -- George Soros, on CNN a couple weeks ago, said the average American, over the past five years, has spent 6 percent more than they made per year. And that just is unsustainable. We're going to have to pay down our debt some.

BLITZER: Can Barack Obama, as the incoming president -- can he turn this around after January 20th, or is that overly raising expectations?

TURNER: I -- you know, I don't think that just -- that, unless there's something I don't know about, that there's not going to be a miracle solution to this. It took us a long time to get into this mess and I don't know how long it will take us to get out.

I hope it's short. I mean, I'm like everybody else. I'm an optimist. But I think, you know, it's going to be a really tough job.

And I think he's probably as good as anybody to lead us out.

BLITZER: Give us some financial advice to our viewers. Where are you holding your money?

And you don't have as much as you used to have, but you still have, I believe, more than a billion dollars.

So, where is it safe to keep your money right now? TURNER: I don't -- I have some Treasury bills that are supposed to be the safest thing of all, but I had some Triple-A bonds in one of those Icelandic banks. I've lost millions and millions of dollars, too.

But the Treasury bills were good. I learned -- you know, I almost -- I got financial trouble when we did the AOL merger, so I got scared and I've invested more -- more cautiously than I would have if I was younger.

BLITZER: Smart. I think a lot of people should be doing that, especially as they get older.

Let's talk about your new book, "Call Me Ted.' And it's really a great book. I went through it. I have a personal interest since, almost 20 years ago, you hired me here at CNN.

And let's talk specifically about CNN. There was no guarantee, in 1980, when you launched a 24/7 cable news network that this was going to succeed. You almost went down at a few points, didn't you?

TURNER: At several points. It was five years before CNN turned the corner. It was -- lost money for the first five years.

BLITZER: This is what you write in the book, on page 192. "It had been a real dash leading up to CNN's launch and now that we're up and running, it turned out our expenses were nearly twice what we had budgeted, while our revenues were about half. With CNN losses four times our projections, the pressure was excruciating."

How close were you, in those early days, Ted, to losing -- to seeing CNN collapse?

TURNER: We needed a federal bailout, but we didn't think about it because, you know -- anyway, I'm just joking. But we were very close. You know, I don't know exactly how close, you know, but close.

BLITZER: I remember those...

TURNER: And the banks called our loans, and I had to refinance.

BLITZER: I remember those days vividly. And people thought you were nuts, in starting CNN.


They called it "the chicken noodle network" because, in those days, there were three broadcast networks. They had a half-hour newscast every day, and here you said, you know what, 24/7, there's going to be news on television.

Who gave you that concept? How did you come up with the idea?

TURNER: Well, I've had some radio stations and I've studied the radio stations a bit and all-news radio, in the big markets of New York and Washington had already been proven successful. So -- and I just knew, as a viewer, as a television viewer, that it would be nice to be able -- you know, if you came in at a time when the news wasn't on, which was most of the day, and you wanted to get an update of what was going on, it would really be a nice to have a channel you could tune to on your television set that would tell you what was going on up to the moment. So, you know, have a feeling of, you'd feel better.

BLITZER: I'm going to put some numbers up on the screen, Ted. I don't know if you can see them, but I'll read them to you. Election night coverage a couple weeks ago from 8:00 p.m. to 12:30 a.m., that's when Barack Obama finished up with his victory speech. On that Tuesday night, CNN had 13.3 million viewers in the United States. ABC 12.5, NBC 11.9, the FOX News Channel 8.1, CBS 7.5 and MSNBC 6.4. The network you started, that you created on basic cable came out No. 1, not only being the cable competition, but the broadcast competition, as well. How do you feel when you heard about that?

TURNER: I was very proud. And, you know, it was a wonderful, wonderful thing to see.

BLITZER: It was an amazing --

TURNER: But I think we were No. 1 during the Gulf War, too, I think, some of the time.

BLITZER: We were No. 1 during the Gulf War, a war that I covered. And remember, that is just in the United States. When you add up all the other people watching in 240 countries and territories, we're talking about a lot of viewers out there.

I'm going to read another quote from your book because I think it speaks of what's going on right now. "I look around to see what the competition is running, figure out whose tastes aren't being met and provide them with an alternative."

At this critical time when you're looking at this economic crisis, what do you think that alternative might be, not in television but in any field that you would be spending your time and energy on, right now, let's say you were 30 years younger.

TURNER: Well, I'm a great believer in clean alternative, locally produced power. Wind, solar, GF Thermal and now probably biofuels. We need to move away from the fossil fuel energy system where we're burning things and putting all these greenhouse gases in the atmosphere to clean locally produced energy, like T. Boone Pickens says.

BLITZER: You're with him when it comes to that. Ted Turner's book is called "Call Me Ted." It's a great read. Ted Turner, thanks for coming in.

TURNER: It's a pleasure, Wolf, thank you. BLITZER: Thank you. And up next, she and John McCain lost to Barack Obama, so what does Sarah Palin think of the election of the first African-American president of the United States? My interview with the former vice presidential candidate. It's wide ranging, you're going to see it right here on LATE EDITION. (COMMERCIAL BREAK)

BLITZER: Her bid to become the first female vice president of the United States may have failed, but Sarah Palin is not about to disappear. She was very much in the spotlight when Republican governors from around the country met this past week in Miami. It was there that I had a chance to speak with the Alaska governor about a number of topics, including this historic presidential race.


BLITZER: And joining us now, the governor of Alaska, the -- I guess you could call her now the former Republican vice presidential nominee, Sarah Palin. Governor, thanks very much for coming in.

PALIN: Thanks. Yes, you could call me the has been.

BLITZER: No. You're not a has been. A lot of people know that. Let's talk a little bit about what's going on in our country right now.

It's a pretty historic moment, when you think about it, the first African-American president, President-elect Barack Obama. This is historic. What does it mean to you?

PALIN: It's historic, and I think this time is full of optimism. And it's an opportunity for everybody to get it together and start working together. For us, as Republicans, to reach out to Barack Obama and the new administration that will be ushered in, and offer the solutions that we see for meeting some of America's great challenges right now.

This is an opportunity to all be working together. And of course President-elect Obama had promised also bipartisan efforts to meet the challenges. So let's seize this opportunity. Let's take him up on that offer. And let's all start working together.

BLITZER: Are you ready to help him?

PALIN: Absolutely, especially on energy independence, energy security that we need for this nation. Being the governor of an energy-producing state, knowing that we have the domestic solutions there in our state and in other energy-producing states, I'm more than willing and able to help President-elect Obama to start tapping into the domestic solutions that we have now so we can quit being so reliant on foreign sources of energy.

BLITZER: So if he reaches out to you and says, Governor Palin, I need your help on energy, or some other issues, kids with special needs, for example, and says, I want you to be part of a commission, you would be more than happy to say, Yes, Mr. President?

PALIN: It would be my honor to assist and support our new president and the new administration, yes. And I speak for other Republicans, other Republican governors also. They being willing, also, to, again, seize this opportunity that we have to progress this nation together, a united front.

BLITZER: Because, you know, during a campaign, every presidential campaign, things are said that's tough. As you well know, it gets sometimes pretty fierce out there.

And during the campaign, you said this. You said, This is not a man who sees America as you see it and how I see America. And then you went on to say, Someone who sees America, it seems as being so imperfect that he's palling around with terrorists who would target their own country.

PALIN: Well, I still am concerned about that association with Bill Ayers. And if anybody still wants to talk about it, I will, because this is an unrepentant domestic terrorist who had campaigned to blow up, to destroy our Pentagon and our U.S. Capitol. That's an association that still bothers me, and I think it's still fair to talk about it.

However, the campaign is over, that chapter is closed. Now is the time to move on and to, again, make sure that all of us are doing all we can to progress this nation. Keep us secure, get the economy back on the right track. And many of us do have some ideas on how to do that, and hopefully we'll be able to put all that wisdom and experience to good use together.

BLITZER: So, looking back, you don't regret that tough language during the campaign?

PALIN: No, and I do not think that it is off base, nor mean- spirited, nor negative campaigning to call someone out on their associations and on their record. And that's why I did it.

BLITZER: And just one historic footnote. Was that your idea or did somebody write those lines for you?

PALIN: Oh, it was a collaborative effort there in deciding, how do we start bringing up some of the associations that perhaps would be impacting on an administration, on the future of America? But again though, Wolf, knowing that it really at this point, I don't want to point fingers backwards and play the blame game, certainly on anything that took place in terms of strategy or messaging in the campaign. Now is the time to move forward together, start progressing America.

BLITZER: Let's talk about some of the current issues on the agenda right now. And I speak to you as someone who's emerging as a potential leader not only of the Republican Party, but maybe if you want to run again for president or vice president down the road.

Right now a big issue, should the U.S. government, the federal government, bail out the Detroit, the big three automakers? PALIN: Well, that is the discussion of the day. And there's going to come a point here where absolutely, the federal government must play an appropriate role in shoring up some of these industries that are hurting and will ultimately hurt our entire economy, and the world's economy if there aren't some better decisions being made.

PALIN: But we also have to start shifting some debate here in our country and start talking about personal responsibility, and responsibility of management in some of these corporations and companies, so that from hence forth, it's not assumed that the federal government is going to be bailing out everybody who's going to soon line up, Wolf, for more taxpayer assistance. And I'm talking about personal responsibility, too, in terms of homeowners and in terms of folks who maybe have extended their own credit.

Sure, predatory lenders are to blame in all of this also, but we have got to make sure, for instance, we're not talked into buying a $300,000 house if really we know we can only afford a $100,000 house. And we've got to start living those lessons that we try to teach our children in terms of not living beyond our means and extending our own personal credit to the point of not being able to pay our monthly bills and then expecting government to grow and be the answer?

BLITZER: So I'm still waiting for the answer. Should the government bail out the big three automakers?

PALIN: Well, it's in debate right now, and I'm listening closely to the debate. And there's a lot of information that even you and I certainly aren't privy to understand all the ramifications if the federal government were going to step in and bail out.

But we do know that the auto industry is that important and certainly it needs to be considered. But I'm not going to ignore the debate again that I think needs to lead to the personal responsibility, the management decisions that have been made in some of these companies and corporations that have also led us to where we are.

BLITZER: So I hear you saying you need more information then?

PALIN: Yes, I do.

BLITZER: What about the $700 bailout of the financial industry? Was that the right thing to do with hindsight, based on what you know right now, or the wrong thing to do?

PALIN: I still believe it was the right thing to do to be able to propose this rescue package, certainly in the home mortgage industry, because with foreclosures up 71 percent compared to where we were last year on foreclosures, this is bad ultimately for our entire economy. And it doesn't do any neighborhood, or any community, any state, any good to see the rate of foreclosures that we have. So with home mortgages and overall with the general bailout plan, yes, I think it was the right thing to do. The federal government had to take some action. But it cannot be assumed again that taxpayers can be looked to for all of the bailouts as more and more corporations, companies, entities come forward with their hand out for government to continue to bail.

BLITZER: Should Congress go forward right now with another economic stimulus package to help the struggling middle class?

PALIN: I do want to see the struggling middle class be the ones at the end of the day who are not stuck with the bills and stuck with the burdens. But I am not one, again, to believe that it should be just assumed that it's a taxpayer bailout that will be the solution to all the problems, all the financial challenges that our nation is facing.

Supportive of $700 billion initial, now hearing more rumor, more speculation of even greater amounts being poured into that. There again, need more information, but not being so enthused about a second, a third, a fourth stimulus package.


BLITZER: All right, much more of the interview coming up. What would Governor Sarah Palin like George W. Bush to do in his remaining time in office? She weighs in on that and a lot more when LATE EDITION continues.


BLITZER: Welcome back to LATE EDITION. I'm Wolf Blitzer in Washington. James Carville and Ed Rollins, they're standing by live to weigh in on Sarah Palin's future and whether Hillary Clinton might become the next secretary of state. But, first, here's part two of my interview with the Alaska governor and former vice presidential candidate, Sarah Palin.


BLITZER: President Bush only has, what, two and a half months or so left. What would you like to see him do in these remaining days and weeks? What's the most important thing he should be doing right now?

PALIN: He's already doing that, and that's reaching out to Barack Obama and to those potential new cabinet members also, and those whom we know will be in the cabinet. Reaching out to them and not being one to stay away, to shy away from addressing the challenges that we have today, working with the new administration, and start ushering in some new solutions. So I appreciate that he's already done that.

And that bodes well for our president also. And other things also that bode well for President Bush and keeping our country safe for the last seven years with no new attack on the homeland, those things I think we cannot lose sight of that President Bush has allowed for progress in those areas in our nation. You know, I'm going to do a shout-out to our president and thank him for that.

BLITZER: Even though he may have hurt you and John McCain in terms of becoming president and vice president?

PALIN: You know, I think that there is so much blame to go around, if you will, in terms of why it was that the Republican ticket did not win. And you know, that's being attributed to, we didn't get the Hispanic vote, that really hurt; we were outspent tremendously because, of course, Obama took the private financing, John McCain had stuck to his promise of just keeping the public financing in the campaign, so greatly outspent.

Barack Obama was a great campaigner. He had a very strong organization. So many reasons. I'm not going to look backwards there, again, and point to just President Bush and the administration as to why our ticket didn't prevail.

BLITZER: You look back and say to yourself, I wish I would have done something differently? Is there anything you look back and say, you know, I think I could have done something differently that might have helped?

PALIN: I just wish there had been more hours in the day, been able to speak to more Americans through the media. I would have loved to --

BLITZER: We tried. We tried. God knows we tried.

PALIN: I'm sorry. All right. That's why we're here today, Wolf. Yes.

But just more hours in the day so that we could have reached more Americans with that message of who it is that John McCain is. He is a true American hero. He does have solutions in mind for this country to get the economy back on the right track and to win the wars. But he now, as a leader in the Senate, we're going to be looking to him, again, being able to unite the party, but also helping unite the nation, working with the new administration. John McCain will continue to be that strong leader in America. And we need to listen to him.

BLITZER: Let's talk about affirmative action right now. It's a sensitive subject.

Now that there's a president-elect who's African-American, do you believe it's time to get rid of affirmative action in our country?

PALIN: I am one to believe in equal opportunity for everyone. And there probably are some specific policies that it is time that America can kind of turn that page, understanding that, with the intent of treating everybody equally and providing equal opportunity in the workplace, and in education, there are some specific policies that I'm sure, and we can move beyond.

And here again, you know, as Barack Obama prepares to take this office of Washington and of Lincoln, what progress our nation has made in not allowing race to be prohibited at all -- a prohibitive factor in an election. I'm so proud of America and very happy to see what Barack Obama, he has accomplished this for himself, but also for our nation, for our children, to know that race is not a factor, cannot be a factor, cannot be a ceiling or a prohibition towards progress.

(END VIDEOTAPE) BLITZER: And in our next hour of LATE EDITION, Sarah Palin talks about what the Republican Party needs to do right now to regroup and whether she'll run for president in 2012. That's coming up in our next hour.

But up next, she was his rival during the primary season, but is Hillary Clinton on the verge of becoming secretary of state in the Obama administration? We're going to talk about it with James Carville and Ed Rollins. They're standing by live. LATE EDITION continues right after this.



CLINTON: I am not going to speculate or address anything about the president-elect's incoming administration and I'm going to respect his process and any inquiries should be directed to his transition team.


BLITZER: Senator Hillary Clinton avoiding, but not denying the possibility that she might become Barack Obama's secretary of state. Word that the president-elect is, indeed, considering his former political rival to be his top diplomat shook up what was a relatively quiet transition week. Let's discuss this and more with two of the best members on the best political team on television. The Democratic strategist James Carville joining us in New Orleans. And the Republican strategist Ed Rollins is joining us in New York.

James, what do you think, is she likely to be the next secretary of state of the United States?

CARVILLE: Well, we do speculate. I would speculate that there's a lot of momentum from this and I sense in my conversations I have had and I have talked to people and I have talked to people who have talked to people, is that this thing could very well happen. Not saying that it's a done deal, I would be surprised but not shocked if it didn't happen. But I think the momentum is clearly for it to happen.

BLITZER: Any idea, James, when the announcement, if it happens, might take place? Are we talking days, weeks?

CARVILLE: Right, I don't have any sort of personal knowledge, but I think Ed would vouch for this, that they're going to have to do it pretty soon. It's only so long that this can sit out here. There are probably some things that have to be worked out that people are working very hard now.

But my sense is, and I don't base this on any first-hand knowledge is that they can't leave it hanging out there for very long.

BLITZER: I think you make a good point. Ed, listen to what the Republican governor of California, Arnold Schwarzenegger, said this morning on ABC when asked about the possibility that Hillary Clinton might become secretary of state.


GOV. ARNOLD SCHWARZENEGGER, R-CALIF.: I think that Senator Clinton is a very, very bright woman and very experienced. I think this could be a great move.


BLITZER: I think this could be a great move. What do you think?

ROLLINS: I think it's a brilliant move. I personally think that she came within 100 delegates of being president of the United States. I think she has got worldwide experience. I think that she's a good team player and she showed we went to the Senate. A lot of Republicans were very apprehensive about her and she worked well across the aisle. So I think it would be a great choice. I think solidifies, not that Obama needs to solidify anymore, but it really closes that final door on the Democratic Party and I think it gives them a great team.


BLITZER: And what about Bill Clinton, James? You know, he's got a global initiative, the Clinton foundation. He travels all over the world. I assume that there would have to be some agreement on his part to do nothing that could interfere with his wife as secretary of state or with the president of the United States for that matter.

CARVILLE: I'm sure. I'm sure that that's a matter that people are discussing. But I think this just shows, it says a lot about the president-elect. I mean, she is, you know, terrific for that position and the fact that he is willing to put all this aside and go with what is obviously the best choice for the position here says a lot really good about him. But, yes, these are issues that I'm sure are being discussed and they will have to be worked out and it's legitimate to ask these questions.

BLITZER: Tomorrow, Ed, the president-elect is going to be receiving the former Republican presidential candidate John McCain in Chicago. When I interviewed Barack Obama in the final days of the campaign, he didn't rule out the possibility of cooperating, trying to find a way to work together with John McCain. What do you expect, if anything, to emerge from this big meeting tomorrow?

ROLLINS: I think they'll have a cordial meeting. I think they'll put a lot of the ill will that they had in the closing days of the campaign behind him. John McCain has always been someone that can go across the aisle and make things happen when it's for the best interest of the country. So he has got two years left in this term. I think he could be a very important player. I don't think he's going to go on the administration. I think he'll be more valuable if he's a senator who basically can bridge the gaps.

BLITZER: Here's how he phrased it, James. I'll play the sound byte. This from the interview that I did with Barack Obama, the final days just before the election in Des Moines, Iowa. Listen to this.


OBAMA: I think that he has a history of wanting to work together on some things that I care about, like comprehensive immigration reform and making sure that we are dealing with critical issues like global warming. And, so, I hope that we can forge a strong relationship to get some things done. Get some things moving.


BLITZER: Is it far fetched, too far fetched to assume that Barack Obama could reach out to John McCain and even invite him to join him in the administration?

CARVILLE: I don't think it is. You know, I don't have any -- I expect good things to come out of this meeting tomorrow. It's not outside the realm of possibility. I don't think it would happen. As you know, Governor Napolitano in Arizona is very close to the president-elect. They could work out an agreement where she would appoint a Republican who would agree to serve the remainder of Senator McCain's term and have him come in and offer some position in the administration.

I don't know that will happen, it probably won't. But that's not outside the realm of possibility. And Senator McCain's history has always been, you know, is to sort of work with the Democrats. He's sort of been, he's sort of taking issue with some of the Republicans and you can't, you have to discount the campaign by 80 percent. That happens in politics.

BLITZER: I think that's a fair point. Ed, you know that Barack Obama has said he's read a great deal about Abraham Lincoln and what he did when he was elected president. He reached out to all of his adversaries, his rivals. He basically brought them into his cabinet, if you will, into his government because he wanted them inside as opposed to sniping away from the outside. I think Barack Obama admires that.

ROLLINS: Well, they're both from Illinois. Both obviously have the potential to be -- one is an extraordinary president, one has the potential to be an extraordinary president.

I think any time you can heal the wounds and bring people together, this important crisis, we're facing probably a severe crisis. I'm 65-years-old. I've been around politics for 40 years. No president has ever faced what this young president is going to face in the coming months and years.

So all the more help he can get and I hope that my party in the foreseeable future will be as cooperative as they can on issues that they can cooperate on and basically be a loyal opposition on things they feel strongly about.

BLITZER: All right, I'm going to have Ed and James stand by. We have a lot more to talk about, including Governor Sarah Palin. What exactly is her future? That and a lot more coming up right after this.


BLITZER: We're talking politics with two members of the best political team on television, Democratic strategist James Carville and Republican strategist Ed Rollins.

Ed, Sarah Palin -- she's leaving that door wide open to a possible presidential run in 2012. Is that realistic?

ROLLINS: I think she ought to close the door, go back to Alaska, work very hard...


... to make up for the 10, 12 weeks she's been gone, get herself re-elected in two years and then see where the politics is.

I think, to try and run four years from now, when she's got to run for re-election -- she has 100 percent name ID and she's been a polarizing figure. Some love her; some don't.

She can do a lot for the party, in the course of this -- of this next couple years, but I think trying to be a candidate four years from now will be very, very tough for her.

BLITZER: What do you think, James?

CARVILLE: You know, I keep looking for something nice to say about Sarah Palin and she never gives me any reason to say it.

And what happened is, is that -- and Ed can attest to this, because he and I have been involved in a lot of campaigns. When these campaigns are over, they hit the light switch and it gets dark quick. And it looks like she wants to keep going and not end it.

And I have no idea why she's talking to all of the media and talking about running in 2012, or the door being open, anything else.

I completely agree. She could have given a -- maybe she wanted to give a couple interviews and explain the clothes issue, a couple things like that. But to go to that Republican Governors Conference and just dominate the media like that, I just don't think was very politically smart on her part.

BLITZER: It was really amazing, Ed, because I was down there, when I interviewed her, this past week, in Miami. And wherever she went, there were 20, 30 cameras chasing her and reporters.

The other governors, including some possible 2012 candidates, they walked around; they had a staff guy, whatever, but that was about it. It was really -- it was really day and night.

ROLLINS: Well, I think there was a lot of resentment about that. Because there's several governors, there, with far more experience. They could have been the vice presidential candidate, may have helped the ticket even more. And there are several of them that basically are planning on running in the future.

So I think the bottom line is, as I said, she's now back in the shark pool. And these governors are going to be the future of our party. And so I think the reality is that she just needs to go back and be a good governor.

She's been in office for two years. She's got two more years in this term. She gets herself re-elected, does a good job, then, obviously, she can come forward and try and move the ball forward again.

But I think trying to be a national figure and run a state as far away as Alaska, she will fail on the most important job, which is the job of being the governor.

BLITZER: James, the expectations for Barack Obama, right now, are enormous. And in our CNN Opinion Research Corporation poll we did this week, we asked, "Will Obama change the country?" Sixty-three percent said yes, for the better.

The "conditions in the country four years from now" -- look at this: "Better" -- 76 percent said the conditions will be better than they are right now.

And finally, "Will Obama improve economic conditions?" Seventy- six percent said that was likely. He's got -- he's got a huge expectation that he's going to have to deal with.


CARVILLE: Well, I hope that -- everybody talks about how fundamentally smart the American people are and how good their judgment is. I hope that they're correct. I'll tell you that.


Yes, these are some awfully high expectations. And I suspect that the president-elect and his team see these numbers. And I think we're going to hear some sombering talk -- sobering talk from the president -- from the president-elect, here, before long.

I think he is going to change things. I have the expectation he'll do a terrific job, but I think it's going to take a little while.

BLITZER: Ed? ROLLINS: The great skill that he has is the communication skill. He's a very disciplined candidate. Great presidents of this century, Teddy Roosevelt, Franklin Roosevelt, Ronald Reagan, Bill Clinton, could all communicate with the public and bring them around to their point of view.

This president is going to have to explain every sick single step he makes. He's got those great skills to do that. Because we're going through tough, tough times ahead.

BLITZER: What's the single most important thing he needs to do to communicate, James, right now, during this transition before the inauguration on January 20th?

CARVILLE: Well, first of all, he's a superb communicator. And I think he -- he's going to do -- yes, I think he needs to speak directly and say to -- and have people's expectations understand some of the things that we're going to do, you're not going to see result right away, that a quick fix -- an attempt at a quick fix is more dangerous than a steady course.

And he's got to give us a sense of the course that he's on and talk to us periodically. And I think that's an important point. Ed makes a very good point.

His communication skills are going to be very, very important here, and to get people to believe in what he's doing and to stay behind him. Because no one that I ever talked to thinks this is going to be short or easy.

BLITZER: Not going to be easy at all. And we're going to be watching every step of the way.

James Carville, Ed Rollins. Guys, thanks very much for coming in.

ROLLINS: Thank you.

CARVILLE: Thank you, Wolf.

BLITZER: And there's much more ahead on "Late Edition," including a debate between two key members of Congress about whether the federal government should bail out the Big Three automakers. "Late Edition" continues, right at the top of the hour.


BLITZER: This is LATE EDITION, the last word in Sunday talk.


BUSH: This crisis did not develop overnight and it's not going to be solved overnight. But our actions are having an impact.

BLITZER: Bailout blues. From a struggling Wall Street to an auto industry on the brink of collapse. What more will Congress do to help? We'll ask Democratic Congressman Charlie Rangel and Republican Congresswoman Marsha Blackburn.

In the spotlight --

PALIN: A lot of Republican governors have really good ideas for our nation because we are the ones there on the front lines being held accountable every single day.

BLITZER: Former vice presidential candidate Sarah Palin discusses the next steps for the GOP and her own political future.

Barack Obama considers Hillary Clinton for secretary of state, as he prepares to meet with John McCain. Is the president-elect assembling a team of rivals? We'll assess the transition to power with three of the best political team on television. LATE EDITION's second hour begins right now.


BLITZER: Welcome back to the second hour of LATE EDITION. This was another awful week for the U.S. economy. Thousands of layoffs were announced and more industries are appealing to Washington for billions of dollars in bailout.

Clearly, there are going to be some tough choices face be members of Congress when they return to work this week. Let's get a preview of what we can expect.

Joining us from our New York bureau, the Democratic Congressman Charlie Rangel. He's chairman of the powerful Ways and Means Committee. And here in Washington, Tennessee Republican Congresswoman Marsha Blackburn. She serves on the House Energy and Commerce Committee. Thanks to both of you for coming in. Let me start with Congressman Rangel. We heard in the earlier hour of LATE EDITION, Congressman, that Carlos Gutierrez, the commerce secretary, speaking on behalf of the Bush administration, now says they support a bailout, if you will, of the auto industry but only if the money comes from an existing legislation, $25 billion from some energy bill that passed last year that you'd have to reprogram but doesn't come from that $700 billion bailout for the financial sector. Is this something you can deal with this week?

RANGEL: Just talking about it is some relief because while the emphasis has been on bailing out the banks, we represent the people, and the banks seem pretty comfortable in trying to find out which way Secretary Paulson is going. But in terms of the people that are looking for jobs or losing their jobs, I think just discussing how we're going to handle General Motors and the one out of 10 jobs that will be lost if they go under is something we can talk about.

BLITZER: All right. Let me play the clip for Marsha Blackburn, the congresswoman. Here is what Carlos Gutierrez, speaking for the president, said in LATE EDITION in the last hour.


GUTIERREZ: What we are proposing, and we have a solution, 2007 energy bill, there is a section, section 136, that made available $25 billion of loans for the auto industry so that they can retool for cars of the future, for fuel efficiency initiatives. That bill, that section can be reworded quite readily and that money can be made available to auto companies that can prove that they are viable or that they have a plan for viability.


BLITZER: All right. What do you think? Are you with the president on this one? BLACKBURN: Well, I would have a lot of questions about this. You know, we hear a lot about bailing out Detroit, but for me it's also about Spring Hill, Tennessee. And I don't want any of my constituents to lose their job. I do have great concerns about just blanket bailouts.

Now what Secretary Gutierrez is talking about there is section 136. That is of the 2007 energy bill that was passed. The money is there to take care of retooling, to meet cafe and energy efficiency standards. There was also money for R&D for next generation automobiles, the lithium-ion battery, things of that nature.

And Wolf, we would have to look very carefully at that because what we've been hearing from the auto industry is they want not only that $25 billion fast tracked to speed up that innovation, but they were wanting an additional $25 billion to handle their legacy costs.

BLITZER: They probably, Charlie Rangel, they probably would like $100 billion if it were available, why not? What do you think about this notion of at least -- letting them use that $25 billion to get themselves out of this financial -- this financial mess they're in right now?

RANGEL: I'm suggesting that it could make a heck of a lot of sense, make certain that the automobile industry will be following a new tract, that we're able to be competitive, that we're not talking more about the same thing.

But I am so pleased that the administration is taking advantage of this one last week we have to talk about the safety and the opportunities of people who are employed.

BLACKBURN: Is it possible, do you think? You know the legislative process better than anyone, Congressman Rangel. Is it possible to pass this, what the administration wants, to retool, if you will, the $25 billion from the energy bill this week, pass it in the House, pass it in the Senate, let the president sign it into law? Can it be done this week?

RANGEL: It could be done. The problem we have is still in the Senate. You recognize that we need 60 votes in order to stop filibusters. It's been abundantly clear that the Republicans in the Senate have not been willing to consider anything in order to have this administration have some type of transition with the next one. So we won't be taking up anything unless we have agreement from the Senate they're willing to pass something rather than give hopes to people and don't do anything at all. The president would have to agree upon it.

BLITZER: What do you think, congresswoman?

BLACKBURN: The Democrats control both sides of the Hill and they can pass whatever they want to pass.

BLITZER: In the House they can, but in the Senate, you need 60 votes to get through a filibuster. They don't have the 60, they have 51.

BLACKBURN: I think what we need to do -- being one that has voted against the bailouts, I think what we need to do is put everything on the table. We know that there are a lot of just-in-time suppliers and manufacturers that are around these auto plants. We need to look at suspending cap gains.

We need to look at what would happen if we had sales tax deductibility, which has -- we have in Tennessee, we deduct that from our federal income tax filing. What would happen if you were to deduct sales tax from everybody's federal income tax filing and give consumers an incentive to go buy? The product?

BLITZER: Well, let's ask the chairman of the Ways and Means Committee. He's responsible for writing tax laws in the United States. What do you think of that idea, congressman?

RANGEL: Any idea that's going to bring relief to the American people instead of just the bank executives is something we should talk about. I don't know whether we have enough time to have hearings on all of these things, but I do believe that the congresswoman is right, that we can't just throw the money out there.

The question is, if the president wants to talk about this, he has to talk to the senators to make certain that we do have enough votes there to pass it. And that's where we ought to be talking about, not our differences, but how can we get out of this Congress -- we got just one more week to go, and give some relief to the people who are unemployed, be able to protect some of the people from this terrible winter we're going to have, to give something in health care, and to make certain we try to bring some stability to employment.

These are the people that are crying for some help. And so we can discuss all of these things, but we won't be able to get back until next January. I hope that this week we can discuss things in a bipartisan way and bring some relief to the automobile industry no matter what compromise.

BLITZER: Basically one week of work you have before the Thanksgiving recess.

BLACKBURN: You're exactly right, Wolf. And we have to get to work on some of these issues. We have to look at the entire picture that we're dealing with, with distributors, with consumers. The energy issue, my goodness, we have to get the cost of energy down. We're looking at the $25 billion that had been put in place for retooling the auto industry.

BLITZER: Let me read to you, Congresswoman, what John Boehner, your leader, the minority leader in the House, said on Thursday. "Spending billions of additional federal tax dollars with no promises to reform the root causes crippling auto makers' competitiveness around the world is neither fair to tax payers nor sound fiscal policy."

And we heard something very similar from the ranking Republican on the banking committee in the Senate, Richard Shelby, earlier today as well. Do you agree with them?

BLACKBURN: I do agree with that. And I think that both Mr. Shelby and Mr. Boehner are correct on that. The American people are now finding out from Secretary Paulson, he spent $250 billion, and there will be no return to the American people on that. AIG is into the federal government for over $315 billion. You had $323 billion that was spent before the $700 billion bailout. This is all on the taxpayers' back. And the taxpayers are getting very, very weary of this. Now, what we need to do --

BLITZER: Let me let Congressman Rangel respond to that. Go ahead, Congressman Rangel.

RANGEL: I think it's true, the taxpayers are getting weary and they should be because all of the assistance is to the financial institutions. But we're there not to represent the banks. We're there to represent the people. And there are just millions of jobs that are dependent on the automobile industry. They're in Tennessee, they're in New York. They're all around this country. It would seem to me rather than going to this debate in the last week of the session, that we should be talking about compromises about how can we help these people? How can we help the industry? How can we help the people? And for those out of work, to give them some support.

BLITZER: Let me switch gears because we're almost out of time.

BLITZER: Congressman Rangel, a lot of us remember it was you who inspired Hillary Clinton as the first lady of the United States to run for a Senate seat from New York. And she did. She got elected, re- elected, almost got the Democratic presidential nomination. But now there is serious talk that Barack Obama might ask her to become the next secretary of state of the United States. How would you feel about that?

RANGEL: Well, we certainly will miss her in the great state of New York but it just shows that President-elect Obama will want to do what's best for the country, and indeed, the free world. I cannot think of a better choice than our great Senator Hillary Clinton. I think it would be terrific if she's offered it and if she accepts it.

BLITZER: How do you feel, congresswoman, about that?

BLACKBURN: I think that Hillary Clinton will probably accept that, from what I am hearing. I think it would be a nice gesture. I think that she is well qualified. She does have a certain standing in the world that is required in order to be able to demand the respect from other countries to deal with issues that are going to be affecting not only us but other of our allies, our trading partners. And I think that she would be a well placed in that position.

BLITZER: On that bipartisan note of agreement, we'll leave it.

BLACKBURN: Absolutely.

BLITZER: Congresswoman, thanks very much for coming in.

BLACKBURN: Thank you, good to be with you.

BLITZER: And Mr. Chairman, always good to have you here on LATE EDITION. Thanks for joining us.

RANGEL: Thank you.

BLITZER: And there's still a lot more to come, including the Alaska Governor Sarah Palin. She talks about her future in national politics. We're going to take a short break. First, this programming note. Join Anderson Cooper Thanksgiving night to find out who will be CNN's hero of the year. And there are just a few days left to vote for your favorite CNN hero. Go to to see their stories. LATE EDITION continues after this. (COMMERCIAL BREAK) BLITZER: Welcome back to LATE EDITION. I'm Wolf Blitzer in Washington. It's fair to say that few if any politicians have hit the national stage like the Alaska Governor Sarah Palin. Now that her bid for vice president is over, what are her plans for the future? That was just one of the topics we covered with we sat down in Miami this past week.


BLITZER: Let's talk about some of the other issues. And we have a question. One of our I-Reporters sent this in.

PALIN: Oh, good.

BLITZER: Eric Olsson of Savage, Minnesota. He says he is a Democrat, he voted for Barack Obama, but he has this question.



ERIC OLSSON, SAVAGE, MINNESOTA: Governor Palin, before the election, you were speaking with James Dobson, and you said you were confident that God would do the right thing for America on November 4. Did God do the right thing for America?


PALIN: I don't know if that was my specific quote, but I do believe that there's purpose in everything.

And, for me personally, I put my life in God's hands and ask him to -- don't let me miss some open door that he has for me, and I will travel through that. And I think the same thing for our nation, as we seek God's guidance, his wisdom, his favor and protection over our nation, that at the end of the day that, the right thing is done.

And, you know, I do believe that prayers were answered, others who prayed across this nation in the election, that -- you know, that this nation would be protected, that we would be safe, that we would be prosperous and favored. I believe that that prayer is answered.

BLITZER: All right. Well, fair enough. What does Barack Obama have to do right now, in your opinion, to show that he's going to reach out to Republicans and independents and work in a bipartisan way?

PALIN: He needs to do what I did when I was elected governor of Alaska. And that is, you don't use as your litmus test partisanship. You do not look to someone's party affiliation, but you look to fill your Cabinet positions, especially, with the best of the best. That's what I did as a governor of Alaska, appointing Democrats, independents, Republicans all to work in a team effort, really walking the walk, not just talking the talk, not just that rhetoric of, you know, an ability that's preached to reach across the aisle. But he's really going to have to walk that. And he can do that by appointing others who are not just a member of his own Democrat Party. And I think we're going to see that.

BLITZER: Here's another question from Dan Waun of Lansing, Michigan. He was undecided. He said he leaned for McCain at one point, was for Bush in '04. He ended up voting for Barack Obama. This is his question.


DAN WAUN, LANSING, MICHIGAN: What would you propose the GOP do to reconcile this ideological shift, in order to regain moderates and independents, who so convincingly voted for President-elect Obama?


BLITZER: He's referring to the ideological shift, the conservative, social religious base vs. the more moderates, the pragmatic independents in the middle.

PALIN: Well, if there is some kind of perception that conservatives and those who maybe represent a conservative base are not pragmatic and are not thinking along those lines that you put a sense of partisanship aside, then I beg to differ with the whole premise of his question.

Certainly, this is opportunity, though, to bring people together, to unite and start finding the solutions to America's great challenges. But, as you're reading these viewers' questions, you got any questions from anybody who voted for McCain?

BLITZER: I think we do.

PALIN: Oh, good. OK.


BLITZER: But stand by. We're going to get to that.

Another question: What are your new ideas on how to take the Republican Party out of this rut that it's in right now? Give me one or two new ideas that you're going to propose to these governors who have gathered here in this hotel? PALIN: Well, a lot of Republican governors have really good ideas for our nation, because we are the ones there on the front lines being held accountable every single day in service to the people whom have hired us in our own states. And the planks in our platform are strong. And they are good for America. It's all about free enterprise and respecting equality and...

BLITZER: Is there anything new you want to come up with, a new Sarah Palin initiative that you want to release right now?

PALIN: Nothing specific right now, sitting here in these chairs, that I'm going to be proposing. But in working with these governors, who, again, on the front lines, are forced to -- and it's our privileged obligation to find solutions to the challenges facing our own states every day, being held accountable, not being just one of many just casting votes or voting present every once in a while.

We -- we don't get away with that. We have to balance budgets, and we're dealing with multibillion-dollar budgets and tens of thousands of employees in our organizations, that executive experience that every governor has and must have being put to good use now as we work together as governors to help reach out to Barack Obama's administration, being able to help him make good decisions, based on the solutions that we already see, for me specifically, of course, energy independence that is doable here in this country. We have the domestic solutions because we have the domestic supply.

BLITZER: And that's a huge issue for you.

Here's another question from Chris Plumstead (ph) of Cumberland, Maine.


CHRIS PLUMSTEAD, CUMBERLAND, MAINE: Yes. Hi, Governor Palin. I was wondering how you plan on dealing with a convicted felon and senator of your state.


BLITZER: He's referring to Ted Stevens.

PALIN: Right.

BLITZER: He may or may not be re-elected. We don't know. But what are your thoughts?

PALIN: Well, and after the four counts -- the felony counts and the judgment came down --

BLITZER: Seven. Seven.

PALIN: Seven. Yes.


PALIN: After that came down -- and I called for him to step down and he chose not to.

PALIN: Now it is in the hands of the U.S. Senate. It takes two- thirds vote to expel. It's up to the U.S. Senate to decide what to do.

But the voters of Alaska -- the will of the people was that he would be representing Alaska. And whether some of that vote's intent was that he would win the election and then we would have a special election and still have a chance to hold onto that seat in the Republican Party, maybe that was some intention, there, of some of the voters.

But it's in the U.S. Senate's hands now. It's not in my hands.

BLITZER: So if he's re-elected -- they're still counting ballots, I take it, up there, and the Senate goes ahead and kicks him out of the Senate, is that something you might be interested in?

Could you name yourself, for example, to succeed Ted Stevens?

PALIN: I suppose, if you were that egotistical and arrogant...

BLITZER: Do you have any desire to serve...

PALIN: ... you would name yourself.

BLITZER: Do you want -- do you want to be in the United States Senate?

PALIN: But I'm not going to name myself.

You know, I believe that I have -- I feel I have a contract with Alaskans to serve. I've got two more years in my term. I'm going to serve Alaskans, to the best of my ability. At this point, it is as governor.

Now, if something shifted dramatically, and if it were acknowledged, up there, that I could be better put to use for my state in the U.S. Senate, I would certainly consider that. But that would take a special election and everything else.

I'm not one to appoint myself or a member of my family to take the place of any -- any vacancy.

BLITZER: All right. So you're not going to name yourself, but you're not ruling out the possibility, in some other way, of becoming a United States senator? PALIN: I just don't to want close any doors, at this point. I'm very, very happy, privileged, blessed to serve as governor, want to continue to do that. But I'm not going to close a door, in the future, here, if Alaskans decide that, perhaps, I could be put to better use for them in another capacity.

BLITZER: You're not ruling out a run in 2012 for president of the United States, are you?

PALIN: Not -- not ruling that out, but there, again, that is based on my philosophy of -- it's crazy to close a door before you even know what's open in front of you.

As you travel this road in life and as you turn a corner, there may be something there that -- circumstances change, you've got to call an audible, and you decide to shift gears, take another direction. I'm always open for that.

You've just got to be prepared. And when you see opportunity and preparation meet, that's how you know that a door is open; you're ready to go through it.

BLITZER: You have five children.


BLITZER: Michelle Obama and Barack Obama -- they have two sweet little adorable girls...

PALIN: Sweet.

BLITZER: ... as you know. Do you have any advice for Michelle Obama, right now, who's about to become our first...


BLITZER: ... our first lady, I should say.

PALIN: Right, right. Well, she is, as I do in the governor's mansion in Juneau, also, let the kids be kids. Let them have their friends come over. Let them -- let them hold onto that childhood, despite the fact that they are going to be in the public eye and in more formal settings and everything else.

Bring spunk and life into the White House. You do that via children being allowed to have fun and just be who they are. And they're just going to have a blast in there.

And it's going to be good for the country, also, to see that young life in the White House. I think it's going to just brighten up our entire country. I look forward to that.

BLITZER: I see a smile coming on your face just thinking about it.

PALIN: Absolutely, yes, yes. BLITZER: How did this campaign affect your family?

Because your kids, you know, they -- obviously, they came into the spotlight as well.

PALIN: My kids are cool, too. They are very adaptable. They've been used to, all these years, me having a very busy schedule as an oil and gas regulator and a city manager and mayor and then governor, and then Todd being very busy with a commercial fishing schedule and North Slope oil production schedule that he has.

The kids have always been very adaptable, kind of, going with the flow, but at the same time being quite independent themselves.

And it's a great, fun family that we have, also, a very full life. And they, too, I believe, have felt that this has been the privilege of a lifetime, to be able to get to know John McCain, be able to run with him, with his family, with the team that we had together.

They got to travel the country and see things that, of course, never would they have had an opportunity before. So it's been nothing but awesome.

BLITZER: Your son is serving in Iraq right now.


BLITZER: Are you worried about the incoming commander in chief, who's going to be his commander, in effect?

PALIN: Well, you know, we've got to make sure there, too, that Barack Obama surrounds himself with -- with strong commanders who understand that our boys, our girls, with their boots on the ground, you know, they're looking to -- their lives -- my son's life is in his hands.

And I do have faith in this new administration, that they're going to look out for America's finest, those in uniform who are protecting us and our freedoms. I have faith that all is going to be well.

And my son, he's -- he's good. He's serving for the right reasons. He's a teenage kid who recognized that he had opportunity to do all that he could, at his stage in life, to help protect America and to serve something greater than self.

And I think about my son -- I think about Track in those terms, and I think, is every elected official, too, serving in government, doing the same thing?

To the best of their ability, are they protecting this country? Are they doing all that they can to make sure that our troops over there, especially, are well-equipped, have the budgets that they need, have all the tools that they need for them to do their job? BLITZER: I'll leave it on that note, because I know you're worried about your son every single day. And let's hope he's OK. Let's hope all the men and women who serve in the U.S. military in Iraq and elsewhere are OK.

Governor, I know it's been very busy. But thanks very much for joining us.

PALIN: Thank you, any time.


BLITZER: And, coming up, I'll discuss Governor Palin's future and a lot more with three of the best political team on television. We'll also assess the prospects of Hillary Clinton becoming the next secretary of state.

But straight ahead, Campbell Brown thinks the way the financial rescue is being handled is a, quote, "joke." Stick around. You're going to want to see what she's saying. We'll be right back.


BLITZER: And welcome back. I'm Wolf Blitzer in Washington. And I'm joined by my colleague, Campbell Brown, in New York.

Campbell, a while ago, you criticized the secretary of the Treasury, Henry Paulson, for essentially asking for a $750 billion blank check, and applauded Congress for demanding real oversight of the financial bailout.

But things have changed. Let me play a bit of what you had to say Thursday night on "Campbell Brown: No Bias, No Bull."


CAMPBELL BROWN, CNN ANCHOR: Well, what a joke. Because here we are today; more than a third of the $700 billion has been spent. Paulson tells us yesterday, oh, by the way, he doesn't think the money is being spent the right way and he's now going to redirect the rest of us -- redirect the rest of it, rather.

Now, for all I know, Paulson is right. Maybe the original plan was a bad one and we do need to regroup, right now, but where the heck is the oversight?


BLITZER: All right, Campbell, so who do you blame?

Where is that oversight that's so essential in dealing with all these billions?

BROWN: Well, that's what's so frustrating, I think, Wolf, to a lot of people, is that there is a system in place -- it was created as part of the legislation when the bailout package passed Congress. There were certain positions, oversight positions that were created by Congress, some to be appointed by Congress, some to be appointed by the White House.

And those jobs have not been filled. Late this week, the White House did put a name forward for one of those positions.

BROWN: But there is squabbling going on on Capitol Hill right now between congressional committees over who has jurisdiction over this or that. And so these jobs are going unfilled. We're now well into addition as you mentioned earlier, into the money. And what we've spent, more than a third of it already, and nobody's keeping track. And I just want to make the point. Paulson may be doing exactly the right thing. The question I have is, how do we know? How do any of us know because there isn't anybody who's sort of keeping track of what's going on.

BLITZER: There's been some talk, Campbell, as you know, that the incoming Obama administration for continuity sake should keep some of these people, maybe even the Secretary of Treasury Henry Paulson, during this economic crisis. What do you think?

BROWN: Well, the hope would be, I think all of us would hope, that at least during this transitional phase they're coordinating. And I spoke just this week with Robert Reich, who is one of the economic advisers to the Obama administration, to the transitional part as they try to create their administration, and he said there is some communication. They are obviously keeping track of what Paulson's doing.

But the Obama folks have been pretty clear about saying, President Bush is the decision-maker right for you. There is one president. And so there probably isn't as much coordination as we would all like. It would be nice to think that both sides, Republicans and Democrats, could sort of rise above politics given the state of the economy right now and try to come up with a plan because clearly this is a very long term problem that takes us well beyond what Hank Paulson does.

BLITZER: Good point, Campbell. Thanks very much. And, remember, you can watch Campbell Brown "NO BIAS, NO BULL" every weeknight here on CNN, 8:00 p.m. Eastern. We'll have more with the best political team on television straight ahead. LATE EDITION continues right after this.


BLITZER: Welcome back to LATE EDITION. As you no doubt know, politics didn't exactly go away when the election was over. Let's discuss the week's events with Suzanne Malveaux in Chicago. She's keeping an eye on the president-elect of the United States, Barack Obama. And joining us here in Washington, our Congressional correspondent Dana Bash and our White House correspondent, Ed Henry. They're all part of the best political team on television.

What's the latest, Suzanne? You're in Chicago, you're right in the middle of everything, on the possibility, and it's only a possibility right now, that Barack Obama will ask Hillary Clinton to be the next secretary of state?

MALVEAUX: You know, Wolf, it may be surprising but I recall back in my first interview with Barack Obama in Iowa, at the time Bill Clinton had said, you know, Rwandan genocide, if only they had listened to his wife, Hillary Clinton, who had suggested that they intervene, that perhaps they intervene, that perhaps hundreds of thousands of lives could have been saved.

I asked Barack Obama about that because he was really basically saying she had just gone overseas, was meeting with dignitaries, drinking and sipping tea with them. And he said, it's well all about judgment, who has good judgment, and that Hillary Clinton didn't have good judgment about the Iraq war.

So on the one hand, the public stance has always been there's this big difference between them, but on the other hand, if you talk to the advisers, you talk to the insiders, and they say if anybody can do this who has the constitution or the personality to bring someone on board who's a real adversary, that it is Barack Obama. That that is the kind of person he is, that this really is something that is definitely real, and reaching out to her for that possible post.

BLITZER: Dana, what does it say about Barack Obama that he's even considering her and we hear it's a lot more than consideration?

BASH: Yes, well obviously it says a lot and I think that's part of the point of him considering her, given the fact that we remember, we covered day in and day out, of the debate between the two of them which really did focus primarily on his readiness to be commander in chief.

Remember the 3:00 a.m. phone call ad she had, remember all the things that she said about his readiness with regard to Iraq, with regard to sitting down with Ahmadinejad, things like that.

But I think the most interesting thing is the fact that we hear about this no drama Obama, this sort of sense from him that he doesn't want to have a lot of soap opera going on inside his world. And he's going to have Clintons in his world, big time.

BLITZER: It's a real possibility, Ed, that she might be the next secretary of state and we could learn that fairly soon.

HENRY: That's right, and I think another aspect of this is keep your friends close, keep your enemies closer. It's quite simple.

And one person close to the transition told me, one part of this, not the largest part, but one part of the equation is get her out of the Senate. She can make a lot of mischief for Barack Obama, as Dana knows, in terms of the agenda. On things like health care, that she cares very passionately about. She can get involved, she can add amendments to his health care bill and do all kinds of things.

But you get her into the cabinet, pull her in this, this team of rivals he's been talking about. Politically, you kind of get her out of the domestic mix and put her on the world stage.

BLITZER: Suzanne, tomorrow, Barack Obama is going to receive another guest in Chicago where you are right now. That would be John McCain. What if anything are you hearing about this meeting. What should we expect?

MALVEAUX: Well, Wolf, it really is, aides are saying, kind of a courtesy to John McCain. Obviously, Barack Obama has talked about some things that they have in common, whether it is energy or climate change. They're really trying to find some things that these two can talk about. But they believe, you know, ultimately this is a part of what they're trying to do, is bring those people closer together, frenemies, if you will, to not have this be so difficult.

But this something, they want to reach out to the Republicans. We are not expecting any kind of cabinet post or any positions within the administration. But clearly smoothing over that relationship with John McCain, looking to the Republicans to forge some sort of bipartisan agreement. That is something that he obviously is going to need. They don't have the 60 senators that they need, the filibuster approved Senate. So that is something that they're looking to do. At the very least it's just a gesture, a conciliatory gesture.

BASH: And Wolf, I spoke to somebody pretty senior in the Obama transition this morning. Said, is it fair to say, that there will be no offers of any kind of job inside the administration for John McCain? And I was told yes, that is absolutely fair to say. Look, this was brokered in part by John McCain's best friend, Lindsey Graham. And Lindsey Graham, we've been talking about this since the day of the election, since election night has been really, really pushing John McCain to stay in the forefront of the debate, of every policy debate.

He wants him to be a big part of any kind of compromise, on big issues coming down the road, and that's in part what this is about. It's as Suzanne said, symbolic to try to kind of move on past the pretty bitter campaign. But also to position John McCain so that he could be a big player with regard to any big piece of legislation.

HENRY: It enables Barack Obama to be very deliberate in how he's moving forward and to think about what he did last Monday.

HENRY: He went to the White House, had that meeting with the president. They get all that organized, it looks like the transition is going smooth. Now they kick off the next week by sitting down with John McCain. He's being very magnanimous and reaching across to John McCain and saying I want to hear your views, patching that up and moving forward.

And so it enables him to show that this transition, at least so far, is getting off on the right foot.

BLITZER: All right guys, stand by, because we have a lot more to talk about, including Governor Sarah Palin. What about her future in 2012? Too early to talk about that? Stand by, we'll get back to the best political team in television. Also the California Governor Arnold Schwarzenegger, he's not warning of very tough economic times to come. We'll tell you what he had to say on one of the other Sunday morning talk shows. That's coming up in our very popular "In Case You Missed It" segment. Much more on LATE EDITION, right after this.


BLITZER: We'll get back to our reporters round table in just a moment. But right now, in case you missed, it let's check some of the highlights from the other Sunday morning talk shows here in the United States. On NBC, debate over whether the federal government should bail out the big three U.S. automakers.


SHELBY: I think it's a mistake. They would be in a lot of people's judgment a lot better off to go through chapter 11 where they could reorganize, get rid of the management, get rid of the boards. The people who brought them to where they are today. This is a dead end. It's a road to nowhere. And it's a big burden on the American taxpayer.

SEN. CARL LEVIN, D-MICH.: This is a national problem, first of all, without any question. We have at least 3 million jobs dependent upon this industry surviving. We've got -- this is a main street problem. We've got 10,000 or more dealers. They cover the country in every town of this country. The auto industry touches millions and millions of lives.


BLITZER: On CBS, the House Financial Services Committee Chairman Barney Frank outlined the conditions of any potential bailout package for the big three automakers.

REP. BARNEY FRANK, D-MASS.: No dividends, no bonuses for anybody making more than $200,000 a year, a very tough oversight board that among other things could veto ventures that would take some of this money and maybe put it overseas. The $25 billion is going to get them -- divided among three companies, it gets them into the next administration before anything else can happen. Either they'll have to all pay it back and we're out of it, or they will come up with plans that will convince people that they can be both environmentally and economically sound.


BLITZER: On ABC, the California Governor Arnold Schwarzenegger, offered some advice to Congress about approving another economic stimulus package.


SCHWARZENEGGER: When you come up with rescue packages or stimulus packages, don't think just about now. Think what will happen within the next few months or the next year. Things will get worse. Unemployment will get worse. The housing crisis will get worse. The mortgage situation is going to get worse. So what we have to do is we have to plan for the worse situation rather than always one month at a time.


BLITZER: And on FOX, two men considered to be the future of the Republican Party, discussed the lessons learned from their party's election laws.

(BEGIN VIDEO CLIP) GOV. TIM PAWLENTY, R-MINN.: We have to be a conservative party and we should be. But we have to apply those principles in the context of a changing country. The demographics of the country is changing. The technology is changing. The economy is changing. The culture is changing. We have to learn to do a better job of applying our conservative principles.

MICHAEL STEELE, GOPAC CHAIRMAN: We don't know how to talk to people. We have absolutely forgotten how to communicate a message to firmly -- what the governor says, to espouse those very principles in the context of people's everyday lives. When you're talking about an economy that's slowing down, a war that they're concerned about, not to mention health care and other issues, our party has to have a voice. It has to have a relevant voice.


BLITZER: Highlights from the other Sunday morning talk shows here on LATE EDITION, the last word in Sunday talk.

And please be sure to see "FAREED ZAKARIA GPS" right at the top of his hour. This week, Fareed asks his guests if there's a new Cold War between U.S. and Russia. That's coming up. A lot more on "FAREED ZAKARIA GPS" right at the top of the hour only here on CNN.

Up next, a lot more politics to sort through with our panel. LATE EDITION continues right after this.


BLITZER: We're back with three of the best political team on television, CNN's Suzanne Malveaux, Ed Henry and Dana Bash. Dana, you were down there at the Republican Governors Association meeting in Miami this week. I interviewed Sarah Palin. What's the buzz?

BLITZER: Who are the leaders?

Who's emerging as the leader, shall we say, of the Republican Party, so disappointed in their political setbacks on Election Day?

BASH: What is so fascinating, Wolf, is that there isn't one. There really isn't a single person emerging, and not even close to a single person emerging.

And that was what made covering this Republican governor's meeting so fascinating, because, if there is a place to look in the Republican Party, it definitely is in the governor's mansions across the country.

And these Republican governors -- there aren't very many of them, compared to how many there were in the past. They came, many of them, with very specific ideas.

And there are definitely different ideas about the way the party should go, whether it should reach out, whether it should, you know, deal with new technology, whether it should go back to its roots. But I think, to me, what was so fascinating was the reaction to Sarah Palin. Obviously, everybody realized she is a mega-star, at this point. She sucked up most, if not all, of the oxygen down there.

But there was disappointment, even among people who really like her, with the speech that she gave about the way forward for the Republican Party, because, for the most part, she was talking about her stump speech in the -- in the McCain campaign.

BLITZER: Yes, and, you know, there's no doubt that, when she walked around, there were reporters and everyone following her. And when these other governors, most of them, walked around, well, you know, it was like a Republican governor's association meeting.


HENRY: Right, so she's got that platform. But as Dana's saying, what is she going to do with it?

She does now, I think, have to reinvent herself a little bit. She's going to keep who she is, obviously, but she's got to get beyond just the rhetoric of the hockey mom, get beyond, you know, the Joe the plumber stuff we heard on the trail, so much, and get into some substance. What will she do to remake the party?

I mean, you heard Michael Steele talking about, there in that last segment, that you've got to get beyond just the social issues, and you've got to talk about the economy and health care.

And that's something Obama was able to do. Well, Sarah Palin wasn't doing that, that much. She was really going for the social conservatives, in this last race. Moving forward, she's going to have to really expand the field a bit.

BLITZER: You know, let me bring back Suzanne in Chicago. Michelle Obama and Barack Obama -- they sat down, the other day, with "60 Minutes" on CBS, for their first television interview since his win in the election.

I'm going to play, Suzanne, a little clip of what they -- what they said. Listen to this.


QUESTION: I just asked your husband, when did it sink in?

MICHELLE OBAMA, WIFE OF PRESIDENT-ELECT BARACK OBAMA: You know, the night we were watching the returns, I guess I'm, sort of, like him. I'm not sure if it has really sunk in. But I remember, we were watching the returns, and, on one of the stations, Barack's picture came up, and it said "President-elect Barack Obama."

And I looked at him, and I said, "You are the 44th president of the United States of America. Wow, what a country we live in."

B. OBAMA: How about that? M. OBAMA: Yes.

B. OBAMA: Yes. And then she said, "Are you going to take the girls to school in the morning?"


M. OBAMA: I did not. I didn't say that.


B. OBAMA: It wasn't at that moment.



BLITZER: All right, Suzanne, talk a little bit about what, if any, changes you've seen in this couple since the win on Election Day.

It's approaching two weeks. Is it still the same Michelle Obama, Barack Obama, or have you seen a difference? Because you've covered them throughout this campaign.

MALVEAUX: Well, certainly. We were in Grant Park when that big screen, the JumboTron, came up, and CNN was on, and it said, "President-elect," and the crowd erupted. It was really quite an exciting spectacle to see.

But one of the things that Michelle and Barack had been doing for the last couple of weeks before the election is that they had made it very clear to everybody on their team, keep your head down; keep working; don't take this thing for granted; you never know what will happen in the end.

So it is not surprising, at all, to hear Michelle Obama saying that it really hadn't sunken in, at that point. They were very much about working and working really hard.

Now, these two, obviously, very close. That hasn't changed at all. What has changed, Wolf, is the neighborhood. It's really quite amazing to see the transition. The security is incredible. He can't get his hair cut at the local barber anymore, and the barber has to go to him; a lot of life changes that have happened, but they seem to be taking it in stride.

A lot of close friends and family that they're surrounded with -- it's a very tight-knit group of people, the same folks who have been taking the kids to school, as well as Michelle's mother, are carting them back and forth, the friends as well.

So they've got the same play dates. They've got the same kind of schedule, if you will -- very, very focused, very structured, Michelle really being at the center of all of that.

But there's a tremendous amount of change that they are looking forward to, and Michelle, fiercely protective of her daughters.

BLITZER: And, you know, it's -- for a lot of people, it's really sinking in, now, Dana, that Barack Obama and Michelle Obama and their sweet, adorable, two little girls -- that's going to be the first family, right now, starting January 20th.

BASH: Absolutely. Obviously, we have been focusing so much on who's going to be in the Cabinet and what the relationship is going to be like between Barack Obama and, for my part, you know, some of his fellow Democrats in Congress.

But there's no question. Look, this is -- Americans, really everybody around the world, loves a storyline, and they love to be in love with people who are kind of, you know, leading the country. And we've known this since the 1960s.

And there is no question that the changes that we are going to see are going to be absolutely captivating to all of us here and to everybody around the country.

BLITZER: We'll watch every step of the way. Guys, thanks very much for coming in. An excellent discussion as usual. But, up next, the woman known as the other side of Barack Obama's brain. You're going to hear what Valerie Jarrett has to say about the president-elect reaching out to Republicans, including Governor Sarah Palin. "Late Edition" will continue, right after this.


BLITZER: Barack Obama has asked one of his long-time campaign advisers and good friend, Valerie Jarrett, to be one of his senior White House advisers.

When I spoke with Valerie Jarrett, this week in "The Situation Room," she talked about the president-elect wanting to reach out to Republicans, including the former vice presidential candidate, Sarah Palin.


JARRETT: One of, I think, his remarkable qualities, Wolf, is his sincere interest in learning from all different perspectives. And if Governor Palin has some innovative new ideas coming out of Alaska, of course we're interested.

BLITZER: So, you're saying -- correct me if I'm wrong, Valerie -- that it's not out of the question that, for example, on something like energy, where she knows a lot, given Alaska's role in energy production, you could see a meeting between the president-elect and the governor of Alaska, in which they might discuss things going on, involving ANWR, the Alaskan National Wildlife Refuge, or other issues?

And maybe he could be picking her brain -- is that right?

JARRETT: He's interested in picking brains from all different perspectives. Part of why, I think, he is where he is today is his openness and his willingness to listen.

He likes to have people with different perspectives. He has an insatiable appetite for new and innovative ideas.

And, Wolf, that's what the American people deserve. That's why they voted for him. That's part of what the message of change is all about. It's people working together in a bipartisan nature.

The fact that we could have a hotly contested election just weeks ago, one week and one day ago, and still have Governor Palin make that generous offer, that's what -- that's what the American people deserve. And that's what makes our country great.


BLITZER: Valerie Jarrett, speaking with me, earlier in the week, in "The Situation Room." And that's your "Late Edition" for this Sunday, November 16th. Please be sure to join us again next Sunday and every Sunday at 11 a.m. Eastern for the last word Sunday talk. I'm also in "The Situation Room," Monday through Friday, from 4 p.m. to 7 p.m. Eastern.