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Conservative Dems Dog President; Budget Axe Hits Pentagon; President Obama's Possible Commerce Choice

Aired February 23, 2009 - 17:00   ET

THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.


WOLF BLITZER, CNN ANCHOR: And to our viewers, you're in THE SITUATION ROOM.

Happening now, financially-strapped states now just days away from seeing their first stimulus dollars. But some governors are saying they may refuse at least some of the handout.

And a sign of the desperate times -- Florida goes to hand out 3,000 applications for housing help, but 5,000 show up and there's violence and chaos.

And a prison escape right out of the movies, but this is real life. It's daring and dramatic and it's all on videotape.

I'm Wolf Blitzer.

You're in THE SITUATION ROOM.

The first dollars from President Obama's stimulus package will start flowing to cash-strapped states Wednesday -- $15 billion to help cover Medicaid payments. The president delivered the news himself to the nation's governors at the White House today.

But one rising GOP star says he may refuse some of that money. That would be Louisiana's governor, Bobby Jindal, seen as a potential presidential candidate in 2012.

Our senior political correspondent, Candy Crowley, is back.

She's watching this story for us -- Candy, what's going on?

CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT: Well, there are a handful of governors who may, in fact, go ahead and say they don't want at least some of these funds. But there is one who in particular whose rejection is making -- getting people a lot of attention.

(BEGIN VIDEOTAPE)

CROWLEY (voice-over): A rising star in the Republican Party, Louisiana Governor Bobby Jindal is taking some heat for his decision not to take some of the federal stimulus money coming his way. You'd be surprised who understands.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I think there are some very legitimate concerns on the part of some about the sustainability of expanding unemployment insurance.

CROWLEY: At issue -- states who take a certain portion of federal money for the unemployed are required to broaden benefits for laid-off, part-time workers. The Louisiana governor told NBC's "Meet The Press," that's great until Washington stops writing checks.

GOV. BOBBY JINDAL (R), LOUISIANA: Within three years, the federal money is gone. We've got now a permanent change in our laws. We have to pay for it. Our businesses pay for it.

CROWLEY: Jindal will refuse $100 million of the $4 billion his state will receive. He remains critical of the bill overall, citing wasteful spending that will not create jobs. And that's where he loses the president.

OBAMA: And somehow it's being in broad brushes as wasteful spending, that starts sounding more like politics.

CROWLEY: Even if his concerns are budgetary, Jindal's opposition certainly has political impact. Young, charismatic and the first governor of Indian decent, he was seen as a possible running mate for John McCain. Shortly after McCain lost, Jindal went to Iowa to address a conservative group. There is talk -- which he does not deny -- that Jindal make a presidential run in 2012, which is to say there is more to the discussion than dollars and cents.

Louisiana's Democratic lieutenant governor suggested Jindal needed to choose whether he represents Louisiana or the Republican Party: "It puts the governor at risk of sending mixed messages," he said. "Louisiana should be very aggressive in going to get this money."

In a political swipe, the two New York senators joined others releasing a letter sent to the president, saying they'd be happy to take any money refused by governors.

Bobby Jindal, by the way, was tapped to give the Republican response to President Obama's speech to Congress Tuesday.

JINDAL: We're going to look for every opportunity to reach across the party line to work with him. We absolutely want to see him succeed.

(END VIDEOTAPE)

CROWLEY: And that, of course, is the problem for Bobby Jindal tomorrow night, Wolf. And that is how do you look as though you want to look bipartisan, say that you will be bipartisan and, at the same time, take on a president who has an approval rating over 70 percent.

BLITZER: It's not an easy challenge for him.

CROWLEY: No.

BLITZER: Let's see how he does.

All right, Candy, thanks very much.

And, by the way, coming up shortly, we're going to be speaking live with the governor of Michigan, Jennifer Granholm. She's be here in THE SITUATION ROOM. Stand by for that.

In the meantime, I want to go to Barbara Starr, our Pentagon correspondent.

She's working a story involving some potentially deep cuts in the Pentagon's budget in the coming years. And we just heard the president suggest, you know what, he sort of likes Marine One the way it is. He's not exactly convinced he needs a new generation of a helicopter over at the White House after John McCain pointed out the cost overruns of that helicopter project.

What's going on?

Are they bracing for some major cuts in spending at DOD -- Barbara?

BARBARA STARR, PENTAGON CORRESPONDENT: You bet, Wolf. All over the hallways, the word is it's time to start scrimping and saving. Defense Secretary Robert Gates is telling everyone get ready for some big cuts in weapons spending.

But behind-the-scenes -- no surprise -- defense contractors are already exerting their political muscle, saying it means jobs on their shop floors.

(BEGIN VIDEOTAPE)

STARR (voice-over): The new supersonic Lightning 2 fighter jet uses the world's most advanced technology.

But is it worth the $200 billion for these armored vehicles and communications gear?

Thousands of military industry jobs are at stake. Defense Secretary Robert Gates is about to swing the budget axe and tell Congress to kill off some of the Pentagon's most treasured and most expensive programs.

ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: This moment also presents an opportunity -- one of those rare chances to match virtue to necessity, to critically and ruthlessly separate appetites from real requirements.

STARR: With the military bogged down fighting insurgencies in Afghanistan and Iraq, big ticket items like new fighter jets and warships may no longer be needed as much as they once were. So Gates is eyeballing some major weapons programs, such as the Lightning 2, built by Lockheed Martin; the Army's future combat system, built by Boeing; and General Dynamics' and Northrop Grumman's Virginia class attack submarine.

Winslow Wheeler worked on defense spending issues for Congress for 30 years.

WINSLOW WHEELER, CENTER FOR DEFENSE INFORMATION: We're going to have lots of fights in the next two or three months over various parts of the defense budget.

STARR: Already, powerful defense contractors are lobbying Congress to keep their programs intact. But Wheeler points out the jobs argument may be a losing argument.

WHEELER: For every billion dollars, the Pentagon generates significantly less jobs than mass transit or education or even health care.

(END VIDEOTAPE)

STARR: Another program on the potential hit list, Wolf, is F-22 fighter. The Pentagon is looking at possibly trying to save $8 billion by turning that program. But the defense industry says that would mean 12,000 jobs in more than 40 states. That's one, Wolf, you're going to hear a lot about in the coming days -- Wolf.

BLITZER: All right. We'll hear a lot about some of those cuts at the Defense Department.

Thanks very much, Barbara, for that.

Let's check in with Jack Cafferty.

He has "The Cafferty File" -- Jack.

JACK CAFFERTY, CNN ANCHOR: The financial crisis that's consuming the U.S. along with the rest of the world, is worse than the Great Depression and more along the lines of the collapse of the Soviet Union. Those are the thoughts of billionaire investor George Soros, who knows a thing or two about a few things.

He points to the September collapse of Lehman Brothers as the turning point. Quoting here: "The economy went into freefall and it's still falling and we don't know where the bottom will be until we get there. And there's no sign that we're anywhere near a bottom."

Soros describes the collapsed financial system as still being on life support. Since that day in September when Lehman went down, he says the current turmoil can be traced all the way back to the financial deregulation of the 1980s and that it marks the end of the free market capitalism model.

There's more. Soros thinks the Obama administration's plan to buy bad assets from banks will not be enough to get our financial institutions to start lending again. Instead, he thinks they should inject capital directly into the banks. And Wall Street seems to agree. After starting on a positive note on word that the federal government take -- might take a 40 percent stock in Citigroup, stocks turned lower and finished down 250 more points today, reaching levels we haven't seen since 1997. Meanwhile, it looks like most of us sense we're headed in a pretty dangerous place. A new CNN/Opinion Research Corporation poll shows that 73 percent of those surveyed are scared. Their words -- "scared" -- about the way things are going in the country today. And that's up 6 points from October.

The question then is this: What does it mean when one top investor says the financial collapse is now worse than the Great Depression?

Go to CNN.com/caffertyfile and post a comment on my blog.

BLITZER: Jack Cafferty, thanks very much.

ANNOUNCER: This is CNN breaking news.

BLITZER: There's a developing story -- breaking news at the White House.

Let's go to our senior White House correspondent, Ed Henry.

What are we hearing about a Commerce secretary -- Ed?

ED HENRY, CNN CONGRESSIONAL CORRESPONDENT: Well, Wolf, it appears that the president now finally has a new Commerce secretary pick, his third pick for that job. Senior administration officials as well as Democratic officials familiar with this are telling me and my colleague, Dan Lothian, that the pick is likely to be Gary Locke, the former governor of Washington State -- a very prominent Asian-American politician in this country.

This job of Commerce secretary is expected to take on, in part, the mantle of fiscal reasonability the president was just talking about a few months ago. You remember, Republican Senator Judd Gregg was supposed to be a key part of the cabinet. Focusing in on that as part of the broader economic and financial crisis message coming out of this White House.

He stepped aside, saying he was no longer comfortable, as a Republican, serving in a Democratic cabinet.

Before that, of course, Bill Richardson, the governor of New Mexico, had been originally picked for this job late last year. He had dropped out because of an investigation in New Mexico.

It's been very difficult to get someone in place. They want to finally get this entire cabinet filled up. And, in fact, after this, the last job to fill, of course, will be Health and Human Services secretary. A lot of Democratic officials saying that Governor Sebelius of Kansas is still the most likely pick there.

We're hearing a timetable for all of this is likely to be later this week. It's not necessarily imminent, per se. But that Gary Locke is now the likely choice for Commerce secretary. We're expecting that to happen later this week -- Wolf.

BLITZER: And we assume that they've done a very thorough vetting of the governor -- of the former governor?

HENRY: Well, I think Obama officials would say that they hope that they've done a thorough vetting. And we've been hearing from senior officials in recent days that they've stepped up that vetting process because of some of the missteps -- not just because of the Commerce secretary with Bill Richardson. You'll remember, vetting was not really a problem with Judd Gregg. But, also, obviously, the Tom Daschle problem with Health & Human Services. They have claimed, at least, that they've stepped up the vetting process. We'll see what actually happens.

Remember, Gary Locke, of course, someone pretty well-known, has served as a governor already. But you can bet they were looking at a lot of things in the background just to make sure they don't stumble this time -- Wolf.

BLITZER: All right.

Ed Henry, thanks very much.

President Obama is taking unprecedented to try to aid the ailing economy, but getting a no confidence vote on Wall Street right now as stocks plunging to disturbing lows. Paul Begala and Alex Castellanos -- they're here with their take. That's coming up later.

Also, a brazen prison escape -- convicted felons dodging bullets to climb on a helicopter in the daylight and it's caught on videotape.

And "Slumdog Millionaire" brings new attention to the game show. And one particular question in particular catching our interest today, right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Unprecedented action by Washington to try to jump-start the nation's economy. Not enough, though, to ease anxiety on Wall Street. The Dow Jones Industrial Average and the S&P 500 closed at their lowest levels today since 1997.

Let's talk about that and more with the Michigan governor, Jennifer Granholm.

She's just cover over from the White House, where you had important meetings with your colleagues -- the other governors -- with the president.

What do you think about this report we're now getting from our White House correspondents that Gary Locke, the former governor of Washington State, is apparently in line to become the Commerce secretary.

GOV. JENNIFER GRANHOLM (D), MICHIGAN: Yes, I think that's fabulous.

BLITZER: You know him. GRANHOLM: Yes, I know him well. He is incredibly well-respected, not just among governors, but he's also been very active in the business community. He's very much somebody who had gone overseas. And, of course, the Commerce secretary is somebody who is a salesperson for the U.S. I think he would be a terrific choice.

BLITZER: Why do you think the markets continue to go down and down and down despite all these unprecedented efforts by the president?

GRANHOLM: Well, you know, yesterday we had a presentation from Mark Zandi, who I know spoke at the...

BLITZER: He's an economist.

GRANHOLM: ...at the summit today, as well. But he was saying there are three problems that the administration is trying to fix all at once. One is, of course, the crisis in consumer confidence. And that has created this downward spiral and the stimulus is supposed to be an injection to be able to create that spending.

So there's a -- you know, there's the problem and there's the prescription.

The second is the, of course, foreclosure and the mortgage problem has created -- which started this whole thing -- needs a direct and aggressive response. That also has started.

And the third, of course, is the financial markets. Now, that, of course, is still pending. The crisis in confidence is the thing that is pulling this whole thing down.

BLITZER: Because they seem, though, to lack confidence in what the government is trying to do...

GRANHOLM: Well, I...

BLITZER: ...at least on Wall Street.

GRANHOLM: I think that there's not a -- there's not a completion yet, because the rules are still going to be coming out on March 5th, etc.

So I think there has to be a completion of all three legs of the economic stool and some movement -- some visual movement. And that's why the stimulus is important for governors to be able to say, look, here are people that are being put to work as a result of this stimulus package.

BLITZER: Some of your Republican governor colleagues -- Haley Barbour and Bobby Jindal, Mark Sanford -- they're concerned that some of the money that's destined to go to the states for two years on Medicaid or trying to improve unemployment insurance could become long-term and create a new tax within your state. You've heard that criticism from these governors. Are you worried that the people of Michigan are going to be burdened with long time tax increases for businesses to pay after the two years from the stimulus package, after that initial sum of money dries up?

GRANHOLM: You know, states have the choice about whether they want to do that or not. But I can tell you this. What I am concerned about is the burden that people are experiencing right now. We've had 50,000 people more on Medicaid just since the last four months -- 50,000. Our unemployment rate is the highest in the nation.

People are feeling the pain.

BLITZER: Will you have to increase taxes in two years...

GRANHOLM: Well, if that...

BLITZER: ...to keep that level going?

GRANHOLM: What we're going to use is the solvent part of the Unemployment Modernization Act -- we're going to use to relieve, we hope, some of the businesses taxes that they have to pay right now to make this system whole. So we want to use it as a way to relieve the businesses and not to further enhance the taxes on them.

BLITZER: Listen to what Governor Jindal of Louisiana, who is a rising star in the Republican Party, said earlier today as he left the White House.

(BEGIN VIDEO CLIP)

JINDAL: For example, a billion dollars for the census; for example, $300 million to buy cars for the federal government; for example, $50 million for the National Endowment for the Arts. And the list goes on and on.

There are several -- several spending -- there are several dollars included in the stimulus that it's not apparent to me why they necessarily had to be in the stimulus package.

(END VIDEO CLIP)

BLITZER: All right.

Is it apparent to you why some of that money was in there?

GRANHOLM: Yes. The whole point is to spend and to get money into the stream of commerce. And to say that this is not going to -- that stimulus is not a good idea is ridiculous. Every economist...

BLITZER: Well, they say it's a good idea...

GRANHOLM: ...Democrats and Republicans...

BLITZER: They say it's a good idea. But they're wondering why some of the... GRANHOLM: OK.

BLITZER: ...the money had to go, for example, to the National Endowment for the Arts

GRANHOLM: So that the arts community can keep their operations and keep people employed, because they'll be doing grants to arts communities all across the state.

BLITZER: Wouldn't you rather have the money doing infrastructure?

GRANHOLM: Well, I mean...

BLITZER: Roads and bridges...

GRANHOLM: The question -- I'd love to have more roads and bridges money. But the whole point is, if you're going to criticize 1 or 2 percent of this and say no, no, no, then you're not contributing to the movement forward of the nation. So let's agree to disagree on some things.

But come on, let us move -- put this money into the stream of commerce. And don't just have your platform be no, which seems to be the way that some of the Republicans are going.

BLITZER: The auto industry, it's a huge in Michigan, as all of us know. Tom Friedman, the "New York Times" columnist, wrote this in yesterday's "New York Times": "G.M. has become a giant wealth destruction machine, possibly the biggest in history. And it is time that it and Chrysler were put into bankruptcy so they can truly start over under new management with new labor agreements and new visions."

Those are pretty strong words from Tom Friedman.

GRANHOLM: Would you buy a car from a bankrupt company?

BLITZER: Is that...

GRANHOLM: Would you spend thousands and thousands of dollars for a car?

BLITZER: But the argument that he makes and others make is they're burdened with all these -- these requirements in terms of...

GRANHOLM: And today. So...

BLITZER: ...health insurance and pensions...

GRANHOLM: I understand.

BLITZER: ...and all sorts of dealership requirements, that if they could start afresh, they could become viable. They could compete with the Japanese and the German automakers...

GRANHOLM: And so why not use this opportunity with this -- the advisory team that the president has put together -- to renegotiate some of that?

Why not use this crisis moment to be able to do that?

But putting a company into bankruptcy that sells the biggest consumer product that you buy -- 80 percent of consumers say that they will not buy a car from a bankrupt company. Putting them into bankruptcy is an -- ends their term, basically.

BLITZER: So you don't think they're going to do that?

GRANHOLM: And the bottom...

BLITZER: They're not going to go into bankruptcy?

GRANHOLM: Well, if you put them into bankruptcy, what do you do with all the suppliers?

I mean that whole supply chain, which feeds three-and-a-half million jobs -- the same number of jobs that the stimulus is supposed to create in this country.

If we -- are we going to have a manufacturing sector?

Are we going to support that sector?

Let's restructure them, which they are doing, in a way that makes them viable. And I think the Obama administration is committed to having a viable auto industry. It's going to be tough. They're going to have to do restructuring. But let's make sure we have an industry that succeeds.

BLITZER: Governor, thanks for coming in.

GRANHOLM: You bet.

BLITZER: Appreciate it very much.

A helicopter lands and bullets fly as two desperate prisoners make a break for it. We have the video of the bold daylight prison break. You're going to want to see this.

And Bobby Jindal now the de facto leader of the Republican Party?

That's a question. He's a rising star and he's making headlines with his opposition to the president's stimulus package. Paul Begala and Alex Castellanos -- they're here to weigh in.

Stay with us.

You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Deborah Feyerick is monitoring some other important stories incoming into THE SITUATION ROOM right now -- Deb, what's going on? DEBORAH FEYERICK, CNN CORRESPONDENT: Well, Wolf, a top Senate Republican says it's time to reconsider the United States' long time economic sanctions on Cuba. Senator Richard Lugar is the ranking Republican on the Senate Foreign Relations Committee. In a draft report, he says the 1962 embargo has failed to achieve its stated purpose of bringing democracy to the Cuban people. He says we must recognize the ineffectiveness of our policy and deal with the Cuban regime in a way that enhances U.S. interests.

And the United Arab Emirates is planning -- is pledging $10 billion to prop up Dubai, which is hard-hit by the global financial crisis. Dubai is one of seven Gulf emirates that make up the UAE. And it says it needs the money to stay afloat. Dubai launched ambitious plans in the past decade to become a global hub for information technology, finance and tourism. Dubai lacks the oil reserves of other UAE members and took out huge loans to finance its plans.

And another sign of progress in Iraq -- the nation's national museum, which was looted at the start of the U.S.-led invasion, reopened today. Prime Minister Nuri Al-Maliki and other Iraqi officials attended the opening ceremony. The minister of tourism and antiquities says out of 15,000 items that were stolen from the museum, 6,000 pieces have been returned and restored.

Good news -- Wolf.

BLITZER: Very good news.

All right, thank you, Deb.

We'll get back to you.

A big dive again -- the market has hit its lowest point in more than a decade.

So what's driving the drop and the problem President Obama may eventually have to take credit for?

Plus, a helicopter company advertising escapes to idyllic destinations probably didn't expect prison escapes to be on the list. The high-flying breakout -- authorities say two felons pulled it off.

And the president may have found the key to creating political harmony. We'll tell you what it is, right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

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

Happening now, the lowest point in 12 years -- the Dow lost another 250 points today, hitting a mark not seen since 1997 -- a drop analysts say is being fueled by fears that efforts to halt the recession won't work.

Also ahead, how long before Americans hold the current president responsible? Plus, reports are swirling the government may claim a bigger stake in a huge financial institution, raising a big question -- is this a step toward nationalizing America's banks?

And 12 planes targeted in one night -- what happened to the pilots that has police investigating right now?

I'm Wolf Blitzer.

You're in THE SITUATION ROOM.

The recession may be the country's most pressing problem, but it's certainly not the only one. And President Obama is warning Americans to brace themselves.

(BEGIN VIDEO CLIP)

OBAMA: I want to be very clear, while we are making important progress toward fiscal responsibility this year, in this budget, this is just the beginning. In the coming years, we'll be forced to make more tough choices and do much more to address our long-term challenges, from the rising costs of health care that Peter described -- which is the single most pressing fiscal challenge we face, by far -- to the long-term solvency of Social Security.

In the end however, if we want to we want to rebuild our economy, we will need to change the way we do business here in Washington. We're not going to be able to fall back into the same old habits and make the same mistakes. The casual dishonesty of hiding spending with clever accounting tricks. The costly overruns, the endless excuses. This is what the American people rejected at the polls.

(END VIDEO CLIP)

BLITZER: Let's talk about what's going on today with the Democratic strategist and CNN political contributor Paul Begala and the Republican strategist and CNN political contributor Alex Castellanos. Guys, thanks very much for coming in.

These are very tough choices the president has to make and seemingly, when he talks about it, he points out how dire the situation is now, which seems to fuel that concern out there. What's going on?

PAUL BEGALA, DEMOCRATIC STRATEGIST: I think we need to be concerned. The president is telling the truth and that's a new experience for Americans.

BLITZER: Should he be more hopeful?

BEGALA: He's an extraordinarily hopeful president, hopeful man. As we say back home in Texas and to President Bush, don't pee on my boots and tell me it's raining. Things are bad. He's got a way out. he's got an economic plan. He's got a mortgage plan. He's got a bank capitalization plan. I think you'll see tomorrow night talking about energy, the environment, health care, the long-term things. You always want to be a dealer, and I think this guy is, but he has to be grounded in reality.

BLITZER: Next week, he's having a health care summit.

ALEX CASTELLANOS, REPUBLICAN STRATEGIST: I think what we're seeing, the reason Wall Street seems to be rejecting is that this is Washington, when we've got a plan for you, Barack Obama, there seems to be a new plan for American people every day and we're seeming to come up with every lift wing program the Democrats had for 40 years, we're putting it together now. He said he was going to be a nonpartisan, non-idea logical president.

BLITZER: When he took office, the Dow Jones was almost 8,000. I believe it was 7,949 to be precise. Right now, today, it closed at 7,114. That's a 12-year low.

BEGALA: The stock market though dropped on the first day of each of the last five presidencies. For Reagan, it took 20 months, October of 1982, that the market was back up to January of '81 levels. I don't think it's a vote of whether the president's optimistic, or even his program today. Stocks move up and down because of the fundamentals of the business. A major American bank, their stock is suffering.

BLITZER: Way too much into that.

BEGALA: Shouldn't blame Barack Obama.

CASTELLANOS: I think there's another way to look at it. It makes a difference. Businesses need certainty to plan to invest. We're going to make the rules, it's up to you, business can plan ahead, but now, government has said; no, only we can decide which part of the economy is going to grow. There's no certainty. When business has no certainty, they can't plan and invest. That's why Wall Street doesn't like this.

BEGALA: Now, it's good there's a plan to move things back up.

CASTELLANOS: There's no way business knows what the rules are going to be tomorrow.

BLITZER: Alex, you caused a bit of a stir, your comments about Governor Crist, Charlie Crist of Florida. He wants to work with Obama. You said this to the "Miami Herald." "There is a difference between working in a bipartisan way for the common good and switching sides and putting on the other team's jersey. At the one moment when we've finally found our voice and remember who we are as Republicans, Charlie Crist forgets. It's stunning." He responded to you yesterday on "Meet the Press." Listen to the governor.

(BEGIN VIDEO CLIP)

GOV. CHARLIE CRIST (R), FLORIDA: People run for office in order to try to help their constituents, the people of their state or district of country. In my case, it's Florida and that's all I care about. In Florida, we worked across the aisle.

(END VIDEO CLIP)

BLITZER: The billions of dollars coming into Florida will help a lot of folks.

CASTELLANOS: And crack-cocaine will make you feel better in the short term, but it's not good for your health. Republicans every Republican in the House, nearly every Republican in the Senate think this is just bad medicine for the economy. Not the politics. Think this is bad economics. Me borrowing money from you and you from me isn't going to make us prosperous. Might feel good for a while. Very few Republicans said you know, that's, we're going to forget all that. We're going to borrow and spend our way to prosperity.

BLITZER: There were very few Republicans in Washington but there were governors like Charlie Crist, Arnold Schwarzenegger and a few others, and some mayors that say, you know what? We need the cash.

BEGALA: Here's how you know it's politics and not principle. When a Republican president ran up $5 trillion in debt, all the Republicans supported it. 5 trillion. 5 trillion in debt for which we got as we say in the catholic church, nothing. Virtually no new jobs. The entire Bush presidency, we had 400,000 private sector jobs, 23 million under Clinton. The Republicans had a Republican president who ran up the debt for nothing, just to reward rich people.

CASTELLANOS: We did keep you safe for seven years.

BEGALA: The tax cuts did that? The debt? I don't think so. It's politics. Here's President Obama, yes, it's more deficit spending, but it's going to jump-start the economy.

BLITZER: We hope it does.

BEGALA: He says it will.

BLITZER: All right, guys. Thank you.

It's a prison escape you'll have to see to believe. The suspects, a helicopter and a barrage of bullets.

This version of "Who Wants to Be a Millionaire." One of the questions really hit home. We'll see if you know the answer.

Stick around. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: It's an unfortunate sign of the times, people lining up to get housing assistance and violence breaks out. Let's go to CNN's Brooke Baldwin. She's watching the story. Brooke, what happened?

BROOKE BALDWIN, CNN CORRESPONDENT: Wolf think about supply and demand and really the math just doesn't add up, here we go. 3,000 housing assistance applications in hand. 5,000 people in need of them though. You can imagine that kind of disparity creating quite a scary scene Saturday morning, all for financial aid that applicants may not even see for months perhaps years to come.

(BEGIN VIDEOTAPE)

GABRIELLE WARREN, NEEDS HOUSING ASSISTANCE: This is the most savage thing that I have seen in my whole life for assistance. I need a bailout, OK?

BALDWIN (voice-over): Desperate for housing help, between 4 and 5,000 Floridians stood in line Saturday, some bundled up in blankets and slept on the streets all for a piece of paper, an application to get on the waiting list for government subsidized housing.

SHEILA PELZER, WAITED FOR APPLICATION: Fighting, spraying mace, pregnant people out there. One lady just had a C-section.

TAM ENGLISH, HOUSING AUTHORITY OF FORT LAUDERDALE: We worked with the police department to find a play to keep the crowd as small as possible before we opened the gates.

BALDWIN: Overcapacity crowds forced police to shut down the application process earlier than expected. That meant as many as 2,000 people in need went home empty handed. A company following the trend says that there were 4,403 foreclosed properties in Broward County last month. One in every 182 housing units in a state with the fourth highest foreclosure rate in the nation behind Nevada, Arizona and California. It left many wondering who can help.

ALESIA WADE-BRYANT, NEEDS HOUSING ASSISTANCE: I really need assistance and right about now, it's got to the point where I don't know what to do, who to turn to.

(END VIDEOTAPE)

BALDWIN: Because police had to shut down the application process early, there were still 200 applications they didn't hand out. So members did meet today to discuss how to get the remaining applications to the people who need them, so hopefully that will happen.

BLITZER: Let's hope Brooke. Thank you, Brooke Baldwin reporting.

A helicopter lifts off to cheers of those on the ground. Greek authorities say a man call a modern day robin hood and accomplice pulled off a dramatic prison break for the second time. CNN's Ivan Watson is following the story.

(BEGIN VIDEOTAPE)

IVAN WATSON, CNN CORRESPONDENT: Amateur video of a daring jailbreak that has deeply embarrassed the Greek government. Two felons convicted of armed robbery and murder escaped from Greece's largest prison in broad daylight yesterday, by jumping on to a helicopter. You can hear gunshots and what sounds like inmates cheering as the chopper makes a clean getaway. Police later found the abandoned aircraft and pilot who was bound and gagged, not far from the Greek capital. Incredibly, this is the second time these two criminals have escaped from the same prison, almost exactly the same way. In June of 2006, a bank robber and his partner in crime, a convicted murderer from Albania, escaped by helicopter. It took nearly two years to capture them and today, they were supposed to be in court.

This is the last thing the Greek government needs right now. It's still recovering from weeks of riots. Now, after the second prison escape in three years, the government has fired three top prison officials. Police say they detained some and are interrogating the helicopter pilot, who says a man and woman forced him at gunpoint to carry out the jailbreak. In the meantime, a man hunt is under way for the two most notorious criminals in Greek history.

Ivan Watson, CNN, Istanbul.

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BLITZER: A story in a matter of minutes, pilots aboard a dozen different planes all saw the same thing. The danger they encountered and why it may not have been an accident.

Plus, an Oscar winning movie is bringing renewed attention to a millionaire game show. Why one question today caught our eye. We'll tell you right here in THE SITUATION ROOM.

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BLITZER: A day after the movie "Slumdog Millionaire" walked away with eight awards, the American version of "Who Wants To Be A Millionaire." Today's show hasn't aired in all U.S. markets.

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AL GORE, FORMER VICE PRESIDENT OF THE UNITED STATES: I've traveled to every part of this country during the last sixty years. During my service in the United States congress, I took the initiative in creating the internet.

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BLITZER: That was former vice president Al Gore, telling me what he said way back when, but listen to this. Listen to what was on "Who Wants to Be a Millionaire" earlier today.

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UNIDENTIFIED FEMALE: Forty-five seconds on the clock. Outrageous claims is the category. Al Gore's famous and often ridiculed quote, I took the initiative in creating the internet was made in 1999 to what journalist? Barbara Walters, Larry King, Wolf Blitzer, Matt Lauer.

UNIDENTIFIED MALE: I'm going to phone a friend. Not phone a friend. Lifeline, sorry.

UNIDENTIFIED FEMALE: Yes.

UNIDENTIFIED MALE: We're going to ask the expert.

UNIDENTIFIED FEMALE: Read the clock at 33 seconds and we're going to bring in our expert, Ashley Banfield, with a free, face to face video. Hey, Ash.

UNIDENTIFIED FEMALE: Hi.

UNIDENTIFIED FEMALE: This is about journalism. I'm hoping you might know it. Roger's going for $250,000 here. I'm going to feed you the question now.

UNIDENTIFIED FEMALE: That's a tough one. Because in 1999, all four of these choices were on the air. You know what, I am going to tell you that I believe it is Wolf Blitzer, but I would not stake the house on this one.

UNIDENTIFIED MALE: How sure are you, though?

UNIDENTIFIED FEMALE: I'm going to tell you that I feel about 40% on this.

UNIDENTIFIED FEMALE: OK, Ashleigh. Thank you. Thank you for that. She's thinking it's 40%. You have 33 seconds left. The clock starts now.

UNIDENTIFIED MALE: That wasn't a lot of help. That's a tough one. Let's ask the audience.

UNIDENTIFIED FEMALE: OK. We will stop the clock with 20 seconds. OK, audience Roger needs your help. On your key pads, vote now. OK. Interesting. Larry King, 48%. Wolf Blitzer, 24%. Down from there. You have 20 seconds starting now.

UNIDENTIFIED MALE: It's a lot of money.

UNIDENTIFIED FEMALE: It is.

UNIDENTIFIED MALE: Lot of money. I'm going to take one more lifeline.

UNIDENTIFIED FEMALE: We will stop the clock, then, with six seconds to go. If you miss it, you do go down to $25,000. Could I have your first answer, please?

UNIDENTIFIED MALE: First answer will be c, Wolf Blitzer.

UNIDENTIFIED FEMALE: Final?

UNIDENTIFIED MALE: Final.

UNIDENTIFIED FEMALE: I don't know how she knew it but it's Wolf Blitzer. You're right. BLITZER: $250,000. You know that he got it right. Here's how the vice president at that time, Al Gore, answered my question. Listen to this.

GORE: I've traveled to every part of this country during the last six years. During my service in the United States congress, I took the initiative in creating the internet.

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BLITZER: All right. $250,000, that lucky guy gets. Jack Cafferty, $250,000, that's a lot of money, especially in these hard times.

CAFFERTY: Indeed it is. Question this hour: What does it mean when one top investor, George Soros, says the financial collapse is worse than the great depression.

Kevin writes from Pennsylvania: "It doesn't mean that much to me. We're not even close to a 25 percent unemployment rate of the 1930s and we have a lot more safety nets than during that time. No doubts it's real back, but it ain't the 30s. So let's start losing the great depression comparisons, focus on getting back on the right track. 24 hour cable news networks hammering this stuff over and over again is not helping the situation."

Patty in Illinois writes: "I am wondering, did he live through the great depression? My grandparents and parents did and they say we are nowhere near it. Just because some of us have to change our lifestyle from wanting to have every little thing to jus having the things we need most doesn't mean we're in worse shape than the great depression."

Robert writes: "Soros wouldn't make a comment like that unless he thought he could profit from it. that's how the became a multi- billionaire. Dollars to donuts he's shorting the entire U.S. economy and laughing all the way."

Chris in South Carolina: "During the depression people turned first to agriculture, then to building projects and then the government started helping people. Today, who needs a job? I can get unemployment, food stamps, a mortgage bailout, low cost heating fuel and not do or produce anything."

Don in Grand Rapids, Michigan: "As long as you negative media types and people like Soros keep pushing this, we'll keep sliding. My question to you is when was the last time you had a positive thought? All this negativity is B.S. Shove ready, B.S."

Kathy in Chicago says: "Viva la revolution, Jack. The country is screwed. This problem is bigger and more complicated than anyone thought. Globalization screwed us in the workplace, greed has screwed us in the financial community, political corruption has screwed us in taxes and laws. Maybe we can all get jobs cutting lawns in Mexico."

If you didn't see your e-mail here, go to my blog, CNN.com/Caffertyfile and look for yours among hundreds of others.

BLITZER: Thank you, Jack.

We told you Friday they were coming to the White House. Earth, rain and fire were there last night. We'll show you what they did right after this.

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BLITZER: The guests of honor at the White House last night, the nation's governors. Even some of the president's biggest critics attended. The key to creating some political harmony may be the music of some rock legends.

All right. They're grooving to earth, wind and fire. That's the president of the United States having some fun last night with the governors. Let's check in with Lou to see what's coming up in an hour from now. Lou, what are you working on?

LOU DOBBS, CNN ANCHOR: A lot of rock and roll at 7:00 p.m. eastern. We'll have the controversy over the "New York Post" cartoon. That controversy escalating. The NAACP calling for the editor and cartoonist to be fired. The Reverend Al Sharpton wants to go even further, trying to destroy the entire paper, apparently. We'll be examining what the story's really about. Outrage over what some are claiming is a racist attack on President Obama or is it an attempt to shut down freedom of speech. We'll be discussing that.

And where are the so-called great defenders of free speech in this country? Where is the national liberal media and does it have something to do with conservative newspaper that the national media is being so silent in its defense of the first amendment? We'll be examining the controversy with the country's foremost authorities on the first amendment, Floyd Abrams, Professor Richard Thompson Ford, author of "The Race Card." Join us for all the day's news as we examine this critically important issue. Wolf, back to you.

BLITZER: Thank you, Lou.

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

Happening now, President Obama wraps up an extraordinary question and answer session over at the White House. Members of congress and others grilling him live on TV, including his former rival, John McCain.

Plus, a health care horror story. Imagine you're sick, out of work, and forced to spend as much on medical insurance as you spend on your mortgage payment.

A potential threat to airline safety. A dozen times over at one airport in a single night. Under investigation right now.