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New Questions on Closing Guantanamo; Nine Killed in Netherlands Plane Crash

Aired February 25, 2009 - 18:00   ET


WOLF BLITZER, CNN ANCHOR: Also this hour, the Louisiana governor draws a bullseye on a new target for stimulus critics. Should it cost millions of dollars to monitor volcanoes?

And new second-guessing about the president's plan to close the Guantanamo Bay prison camp, it's coming from a fellow Democrat.

All that and the best political team on television.

Welcome to our viewers in the United States and around the world. I'm Wolf Blitzer. You're in THE SITUATION ROOM.

Right now, President Obama is close to unveiling yet another how- to manual on his plans for fixing the economy and slashing the federal deficit. On the eve of his budget rollout, he's trying to keep the momentum going from his prime-time pep talk to the nation and the Congress last night.

Let's go to our White House correspondent, Dan Lothian. He has the latest on what is going on -- Dan.


And in keeping that momentum going, today, the president was focusing on the banking industry, meeting with his economic advisers here at the White House, trying to set up so-called rules of the road to prevent banks from collapsing like they did in the past, wanting to have a healthy bank system, this administration trying to move beyond last night's speech.


LOTHIAN (voice-over): It was an economic sales pitch to Congress and the country. Identify the problem, paint it in very real terms, then offer solutions.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: The answers to our problems don't lie beyond our reach. They exist in our laboratories and our universities, in our fields, in our factories.

LOTHIAN: The day after the president's address to a joint session of Congress, the Obama administration is now moving to step two: get the stimulus money out the door as quickly as possible.

ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: The tax cuts will soon move out in people's paychecks. The president announced just a few days ago with the governors in town, a big chunk of money relating to Medicaid and health care to insure that they're not having making drastic cuts.

LOTHIAN: The Department of Housing and Urban Development is now taking the first step in awarding $10 billion to states and local governments. Money to create jobs by improving public housing and making units more energy efficient.

Watching over how all this money is spent is a team headed by Vice President Biden. Meeting at the White House for the first time in what will be a weekly gathering, Mr. Biden says he's willing to publicly embarrass governors and mayors who are inefficient.

JOSEPH BIDEN, VICE PRESIDENT OF THE UNITED STATES: I'm going to go on television and say, you know, we gave so-and-so X-amount of dollars and nothing's happening. Why hasn't it happened?

LOTHIAN: The early stages of cracking open the piggy bank. Over the next few weeks, the administration says money will be freed up for food stamps, unemployment insurance, low-income housing tax credits, and law enforcement grants. The White House says taxpayers will be able to watch the process closely, like accountants at

EARL DEVANEY, ACCOUNTABILITY BOARD CHAIR: If they see things that they don't like, and hopefully, we'll get some attention to misuse of any of this money.


LOTHIAN: Last night, when talking about the budget, the president said that his administration had identified $2 trillion in savings. Well, tomorrow, that budget will be unveiled, and we will get a chance to see what's in and what gets cut out -- Wolf.

BLITZER: We will watch it closely.

Dan, thank you.

Just a short while ago, the House of Representatives passed a $410 billion spending bill to keep the federal government running until the end of September. Republicans and budget watchdogs are growing very, very interested. They're wondering if this bill is simply too expensive and is it stuffed with pet projects?

Our senior congressional correspondent, Dana Bash, is working this story for us.

All right, Dana, what's the latest?

DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT: Well, the latest is that, up next, Wolf, for this bill is the Senate, and the Democratic leader, Harry Reid, earlier today made no apologies for the fact that they are boosting the amount of taxpayer money they're spending, even though President Obama called on them for some belt- tightening.


BASH (voice-over): Less than 24 hours after President Obama urged Congress to make tough choices to lower the deficit, his fellow Democrats in Congress moved to increase government spending.

REP. JIM MCGOVERN (D), MASSACHUSETTS: For health care projects, for education projects, all very important to get our economy moving again.

BASH: The $410 billion spending bill funds the government for the rest of this year, with $31 billion more than last year. Republicans accuse Democrats of living in a parallel universe.

REP. PETE SESSIONS (R), TEXAS: American families and small businesses are making sacrifices across this country and cutting expenses due to tough economic times. Yet, this democratic majority continues to spend like there's no problem at all.

BASH: Democrats insist they're mostly trying to make up for cuts under President Bush that hurt the needy. For example, a program that feeds poor women and infants would get $6.9 billion, a 21 percent increase.

But Democrats are also giving generous increases for everything from the Agriculture Department to Amtrak. And Congress is giving its own budget a 10 percent increase to $4.4 billion, well above inflation. That includes $40 million more to finish the Capitol Visitors Center.

And even though Republicans are blasting the bill, they're getting eight million more taxpayer dollars to keep Senate Republican aides from being fired, in the wake of GOP losses in November's election.

And then there are those pet projects, $7.7 billion in earmarks.

The House Democrat in charge of spending decisions is bringing tens of millions back to his Wisconsin district, including $1.9 million for a new building at the University of Wisconsin. He defended congressional earmarks.

REP. DAVID OBEY (D-WI), HOUSE APPROPRIATIONS COMMITTEE CHAIRMAN: The fact is, without the earmarking process, the White House and its anonymous bureaucrats would make every single spending decision in government.


BASH: Now, Republicans may not be like that, so open in defending the earmark process, but I can tell you, Wolf, and it is important to note that Republicans are asking for about 40 percent of the 8,500 earmarks that are in this bill. So, it is certainly bipartisan.

BLITZER: It certainly is. All right, thanks very much for that.

Let's go back to Jack Cafferty. He has "The Cafferty File" -- Jack.

JACK CAFFERTY, CNN ANCHOR: In his address, Wolf, to Congress last night, President Obama laid out what would be an ambitious agenda even in good times. Never mind that we're in the midst of the worst economic downturn since the Great Depression.

And, yet, the president struck an optimistic tone, saying -- quote -- "We will rebuild and we will recover" -- unquote, his speech focusing on three top priorities, energy, health care, and education.

But there was more. Boy, was there more, including, but not limited to, tax reform, beginning a debate on overhauling Social Security, retooling the auto industry, reforming the regulatory system, getting rid of fraud and waste in Medicare, seeking a cure for cancer in our time, expanding mass transit, encouraging parental responsibility, and on and on and on.

Plus, don't forget, there's still a war on terror and two real wars going on. But our president seems remarkably unruffled by all of this, serene in an inner confidence that he's got what it takes to lead this country back into the sunlight.

That's not to say some of this stuff may not have to be delayed for awhile. Mr. Obama acknowledged as much, saying -- quote -- "Everyone in this chamber will have to sacrifice some worthy priorities for which there are no dollars, and that includes me. But that does not mean we can afford to ignore our long-term challenges" -- unquote.

It was quite a performance.

Here's the question: What are the most important priorities for this nation at this time and which ones can wait, in your opinion?

Go to Post a comment on my blog.

It occurred to me watching the president last night, Wolf, that he was born to do exactly what he was doing. He had that place in the palm of his hand for the entire time he was in that room. And that can be a tough audience, a tough room to work.

BLITZER: Yes, he knows how to give a speech, I must say.


BLITZER: He's very good at that. All right, thanks very much.

A man walks into a room at the White House and becomes the butt of one of President Obama's jokes.


PETER ORSZAG, DIRECTOR OF OFFICE OF MANAGEMENT AND BUDGET: And I said, yes, I'm "Supernerd." And the whole room cracked up.

(END VIDEO CLIP) BLITZER: You're about to meet that man who called himself "Supernerd." He's the youngest member of the president's Cabinet. What does he do that affects us all?

Plus, might your bank that handles all your money snap under financial pressure? Many banks are being put to a financial stress test right now.

And nightmare strikes again, death and devastation after a plane falls from the sky. After other recent plane crashes, what might have caused this horror on this day?

We will tell you what we know right here in THE SITUATION ROOM.


BLITZER: Some might call it revenge of the nerds. What's going on inside the Obama administration?

We asked our national political correspondent, Jessica Yellin, to check out what some themselves call the nerds.



Some folks in the Obama administration are focused right now on the budget. You could call some of them nerds. And CNN has learned that budget, in a piece of news, will set up a special fund to help pay for a massive overhaul of the health care system. Administration officials say by trimming taxes to the wealthy and payments to insurers and hospitals, they're going to set aside more than $600 billion over the next 10 years for health care reform.

And the person who hammered it all out is Budget Director Peter Orszag. He's fast becoming a power player in this administration.


YELLIN (voice-over): He's the youngest member of the president's Cabinet, an increasingly public face of the Obama economic team...

ORSZAG: Barack Obama.


YELLIN: ... and a cooperative target of White House jokes. In a meeting with congressional leadership, the president teased Peter Orszag for this photo, which ran in "The New York Times."

ORSZAG: And I said, yes, I'm "Supernerd." And the whole room cracked up. But I try to -- I don't think I was self-described.

YELLIN (on camera): As a nerd?


YELLIN (voice-over): Neither would "People" magazine. Its Web site called him one of the Obama team's hunks.

Tomorrow, Peter Orszag will present the president's blueprint, which for the first time will account for the cost of the wars in Iraq and Afghanistan.

ORSZAG: We're not going to play the games that have been played in the past.

YELLIN: A marathon runner, he lives off Diet Coke, and he will need it. President Obama has tasked Orszag with cutting the budget deficit in half and helping to get health care done this year.

A professional economist, Orszag has long argued that large-scale health care reform is essential to fixing the deficit.

ORSZAG: And we will have to see where that legislative process goes, but I -- I think the goal should be universal coverage.

YELLIN: He was one of the key negotiators in the final hours for the stimulus bill, which prompted Senator Harry Reid to declare:

SEN. HARRY REID (D-NV), SENATE MAJORITY LEADER: He's a natural. He's a brilliant man.

YELLIN: And he won the trust of fiscal conservatives when he ran the Congressional Budget Office.

UNIDENTIFIED MALE: I think Peter's one of the best things that President Obama has going for him when it comes to bipartisanship.

YELLIN: Recently, Orszag got some unexpected attention. He accidentally forced an evacuation of a White House building when he lit some logs that were left by his fireplace. He didn't know the building's chimneys had been covered over.

ORSZAG: And, so, while everything was venting down here, two or three floors up, there was smoke filling a room.

YELLIN: But he quickly came up with a joke to make light of it.

ORSZAG: Rahm wanted me to send some smoke signals to the Hill, or, I'm the budget director. Come on. I was just trying to save a little money on the heating costs.


YELLIN: Now, on a more serious note, Orszag is not without critics. On the left, some worry that he will cut too much. On the right, some are unhappy that his budget phases out President Bush's tax cuts.

And, Wolf, in Orszag's defense, he says that he did check and it did seem -- that fireplace did seem to vent in his office. It was just covered over a few floors up.

BLITZER: Yes, you have got to check that. Yes, OK, good.


BLITZER: All right, thanks very much.

We're going to be speaking with him tomorrow, by the way. He will be here in THE SITUATION ROOM. He will be among my guests, the new budget director.

President Obama today announced his third choice for commerce secretary, the former Washington State Governor Gary Locke. Mr. Obama acknowledged his previous picks, Bill Richardson and Judd Gregg, dropped out. But he expressed hope that Locke will make it all the way to Senate confirmation and a place in his Cabinet.


OBAMA: Now, I'm sure it's not lost on anyone that we have tried this a couple of times. But I'm a big believer in keeping at something until you get it right. And Gary is the right man for this job.


BLITZER: There are some influential slots still open in the Obama administration, including the head of the Federal Aviation Administration, overseeing airline safety, the surgeon general -- that's the leading voice of U.S. health policy -- and the director of the Federal Emergency Management Agency, FEMA, key figure for disaster relief.

Can the bank that handles your mortgages, savings and other financial matters handle all the pressure? The federal government today is beginning what they're calling a stress test to the nation's biggest banks. It's part of Washington's efforts to make sure financial institutions can handle the recession.

Our senior correspondent, Allan Chernoff, has details -- Allan.


ALLAN CHERNOFF, CNN SENIOR CORRESPONDENT: Wolf, the recession has all companies on a treadmill, trying to keep up as the economy rolls downhill. Well, regulators want to be certain that the nation's biggest banks can handle even more financial stress. So, they're testing them by speeding up the economic treadmill.

(voice-over): The exam is under way for the nation's 19 biggest bank holding companies, with assets of more than $100 billion. No bank will fail, though, say government regulators. If a bank looks weak, it may simply have to raise more money.

BEN BERNANKE, FEDERAL RESERVE CHAIRMAN: We will be looking at a two-year horizon and asking the question, what are the expected losses over that whole horizon?

CHERNOFF: How bad could it get for the banks? Regulators are combing through the bankers' books to see how much they might lose if the economy keeps sinking.

The worst case? The economy shrinks 3.3 percent this year, unemployment jumps to 10.3 percent next year, a rise of nearly 3 percent from the current level, and home prices fall by 22 percent this year. The exams will be finished by the end of April.

BRIAN GARDNER, KEEFE BRUYETTE & WOODS: I don't think there's any disagreement across the spectrum politically, economically, that most of these -- some of the larger banks are too big to fail. And I don't think the government is going to let them fail.

CHERNOFF: If the stress test shows a bank could be in danger under the precarious economic scenario, Washington will require the bank to raise more money. If private investors won't put money in, the government will provide more taxpayer money, almost a guarantee, say some financial experts.

LARRY WHITE, PROFESSOR, NYU STERN SCHOOL OF BUSINESS: Well, my guess is, by the time the dust clears, there will be a government substantial stake.

CHERNOFF: In return for taking funds from the Treasury, banks will issue stock to the government that pays a hefty 9 percent dividend.

(on camera): Financial regulators say the whole point of the exercise is not just to be certain that bankers can keep running the economic treadmill, but to make sure that they will actually lend during tough times, which is what the economy needs to move forward, instead of backwards -- Wolf.


BLITZER: Allan Chernoff getting a little exercise in the process.

It's happened again. Another plane falls from the sky, killing nine people. What might have caused this latest plane crash? We will tell you what we know.

Also, it's a volcanic issue, a debate erupting over the use of money from the economic stimulus plan to monitor volcanoes. But what's the truth behind all of this?

And where would the accused mastermind go if released? And might suspected terrorists wind up in your city? Just two questions posed regarding closing down the U.S. prison camp at Guantanamo Bay in Cuba.

Stick around. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK) BLITZER: Anxious hours right now for the families of passengers aboard a Turkish airliner that crashed in a field near Amsterdam earlier today. Dutch authorities say they won't release the names of the dead until tomorrow. Investigators say it's still too early to know what went wrong.

Here's CNN's Ivan Watson from Istanbul.


IVAN WATSON, CNN CORRESPONDENT (voice-over): It started like any other flight. Passengers and crew members boarded Turkish Air Flight 1951 in Istanbul Wednesday morning for the three-and-a-half-hour trip to Amsterdam.

Minutes before the scheduled landing at Schiphol Airport, passengers say they heard a loud noise and what felt like turbulence. Seconds later, the plane slammed into the ground several hundred meters short of the landing strip. The initial reactions from air traffic control at Schiphol Airport:

UNIDENTIFIED MALE: It's a very large emergency. It looks like we lost an aircraft.

WATSON: The Boeing shattered into three pieces, but there was no fire. And, incredibly, some passengers walked out from the wreckage of the plane unharmed.

HUSEYIN SUMER, PASSENGER (through translator): It ran into turbulence and we saw the plane break into pieces. Naturally, there was panic, but it was contained. I'm still in shock. There was heavy damage on the front, and my section broke apart and that is what we used to walk out. Then we called our families, and they thought we were joking.

WATSON: Within an hour of the crash, the Turkish government quickly formed a crisis center. Hope surged after the transportation minister said there were very few casualties. He called it a miracle.

SUAT HAYRI AKA, TURKISH MINISTRY OF TRANSPORTATION (through translator): The latest information is, everyone has been evacuated. There are no deaths.

WATSON: But then, just a few hours later, grim news from officials in Holland: At least nine people were killed in the crash, with dozens seriously wounded.

INEKE VAN DER ZANDE, AMSTERDAM EMERGENCY SERVICES: Nine people -- sorry -- have died. Six people are very seriously injured. And we don't know -- they are critical at this moment -- 25 passengers are really severe wounded.

WATSON: Turkey's pilots association says that the captain of the aircraft, Hasan Tahsin Arisan, was an experienced veteran and former officer in the Turkish air force. Dutch officials say at least three crew members were among those killed in the crash. Worried relatives gathered at Istanbul Airport, waiting for an emergency Turkish Airlines flight to join their loved ones in Amsterdam.

(on camera): In the days ahead, Dutch and Turkish authorities will try to determine what caused this accident. And Turkish officials are already coming under fire here for raising false expectations about survivors in the aftermath of this tragedy.

Ivan Watson, CNN, Istanbul.


BLITZER: President Obama has made it clear he thinks Gitmo has to go.


OBAMA: I have ordered the closing of the detention center at Guantanamo Bay and will seek swift and certain justice for captured terrorists.



BLITZER: But there's some new rumbling about whether Guantanamo Bay may be the best option after all. It's coming from a Democrat.

Plus, millions of dollars to monitor volcanoes -- the stimulus project that's being targeted by a top Republican.

And the best political team on television on why a veteran Democratic senator is accusing the president of a power grab. We will explain that, and more, right here in THE SITUATION ROOM.


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

Happening now: a warning about Argentina, Ecuador, and Venezuela from the new CIA director. Leon Panetta says those nations are in dire economic straits, and he says they could be destabilized by the worldwide economic crisis.

A key Supreme Court decision involving religious displays. Today, the justices ruled that a small religious group cannot force a city in Utah to place a granite marker in a local park.

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

It holds some of the most feared and infamous suspected terrorists. So, where might they go for a new home? Those are among the serious questions being raised right now as President Obama aims to shut down the U.S. detention center at Guantanamo Bay within a year. Those plans, though, continue to meet resistance. Let's go to our homeland security correspondent, Jeanne Meserve.

And, Jeanne, some of that resistance sort of surprising.


Though the president underlined last night his intention to close the prison at Guantanamo the controversy has not subsided, even in his own party.


MESERVE (voice-over): It was one of the applause lines in President Obama's speech last night.

OBAMA: That is why I have ordered the closing of the detention center at Guantanamo Bay and will seek swift and certain justice for captured terrorists.


MESERVE: But a fellow Democrat says, closing Guantanamo Bay may need rethinking.

REP. ALCEE HASTINGS (D), FLORIDA: If Amnesty International and the Red Cross are permitted to see the actual circumstances, then I believe that Guantanamo, different than most, can stay open with a greater understanding in the world as to why the individuals are being held there.

MESERVE: The challenges in closing Guantanamo are complex. Where would dangerous detainees, like accused 9/11 mastermind Khalid Sheikh Mohammed, go? If detainees are held on U.S. soil, would they win the constitutional right to a trial? If they did go to court, could the U.S. present evidence against them without revealing sensitive intelligence sources and methods?

Would some evidence be thrown out because detainees were subjected to harsh interrogation techniques? Is there a risk some detainees would be released into the U.S. or that detainees sent from Guantanamo to other countries would be set free?

Those thorny questions are being thrashed out by a task force led by Attorney General Eric Holder, who made his first visit to Guantanamo Monday. He says the facility, at least at present, is well-run.

ERIC HOLDER, U.S. ATTORNEY GENERAL: I think it does not in any way decrease our determination to close the facility. This will not be an easy process. It's one that we will do in a way that ensures that people are treated fairly and that the American people are kept safe.


MESERVE: The Holder task force has about a year to determine what to do with each of the 245 Guantanamo detainees. But the debate about whether it's the best course of action is likely to continue longer than that -- Wolf.

BLITZER: All right. Jeanne, thank you.

Let's bring in Brian Todd right now.

He's watching another story involving what's called volcano monitoring. The Republican governor of Louisiana, Bobby Jindal, we heard him last night sort of ridiculing that money being spent to monitor these volcanoes.

But what's going on?

BRIAN TODD, CNN CORRESPONDENT: It was a hallmark of his response speech, Wolf. You know, when a bill has got about $800 billion worth of economic jolt for the country, probably not too hard to pick something that might appear frivolous.

Do you think millions should be spent to monitor volcanoes like Alaska's Mount Redoubt right here?

In his response to the president, Republican Governor Bobby Jindal said keeping tabs on volcanoes like this isn't worth stimulus money.

So we drilled down a bit.


GOV. BOBBY JINDAL (R), LOUISIANA: What Congress should be monitoring is the eruption of spending in Washington, D.C.

TODD (voice-over): The Republicans' rising star sounds the party's battle cry over the stimulus bill. The wasteful spending in this package, says Louisiana Governor Bobby Jindal, can be encapsulated in one pet project.

JINDAL: And $140 million for something called volcano monitoring.

TODD: The U.S. Geological Survey is getting $140 million in this package. But volcano monitoring is only one of dozens of backlogged projects targeted for that money. It's not clear exactly how much is going to volcano monitoring, but that project has staunch defenders at USGS.

MARIANNE GUFFANTI, VOLCANOLOGIST, U.S. GEOLOGICAL SURVEY: We don't throw the money down the crater of the volcano and watch it burn up.

TODD: Volcanologist Marianne Guffanti says America's got some of the most active volcanoes in the world. The one on Alaska's Mount Redoubt will likely erupt within a few months and several others are rumbling. They need to upgrade the five volcano observatories across the country, not so much to warn people about lava flows and mud slides, but to warn commercial and military aviation about potentially deadly volcanic ash that often spreads for thousands of miles after an eruption.

In the past, it's brought down at least one commercial plane and rerouted many others. So the monitoring, Guffanti says, has an economic impact.

GUFFANTI: If we can give good information about what's happening, that system of diversions and cancellations all works much more efficiently and fewer people are delayed and business -- standard business is resumed quickly.

TODD: But volcano monitoring gets millions every year from Congress anyway.

Should it get this additional money in the stimulus?

Officials at USGS and the Department of the Interior tell us the stimulus money is for modernizing old equipment that desperately needs it, the yearly budget money is for maintenance and operations.

One economist says the additional money is stimulus.

PROF. DANNY BOSTON, GEORGIA INSTITUTE OF TECHNOLOGY: If it's upgrading, that's no different than the amount of money that you would spend in terms of building a street or building a bridge or something like that.


TODD: And the volcanologist, Marianne Guffanti, says when they upgrade their equipment with stimulus money, they're buying new GPA centers and radios, hiring helicopter pilots, programmers, information specialists. They have to go to volcanoes to install all that. When they do that, they have to stay in hotels, eat at restaurants. So they are doing their part, they believe, to stimulate the economy -- Wolf.

BLITZER: It's sort of like, to a certain degree, hurricane forecasting, which I assume Governor Jindal strongly supports, given Louisiana's track record.

TODD: He didn't mention hurricane forecasting. But you can compare it. The bill allocates about $600 million for the parent company of the National Weather Service for things like satellite development, the improvement of forecasting -- $600 billion compared to $140 million is a lot -- billion dollars is a lot more.

But the governor's office just sent us an e-mail saying they still believe that this is growing government, not growing jobs. They're sticking to their position.

BLITZER: OK. Thanks very much, Brian Todd, doing a good fact check for us.

Energy independence, health care, education and more -- can President Obama succeed where his predecessors have failed and rescue the economy at the same time?

Plus, the president accused of a power grab with his White House appointments. And that's coming from a Democratic Senator, that accusation. The best political team on television is here to discuss it.



OBAMA: Nearly a century after Teddy Roosevelt first called for reform, the cost of our health care has weighed down our economy and our conscience long enough. So let there be no doubt, health care reform cannot wait, it must not wait and it will not wait another year.


BLITZER: Nancy Pelosi, the speaker, was quick to jump up and applaud that line.

Let's talk about what's going on with our senior political correspondent, Candy Crowley; our CNN political contributor, Steve Hayes, of "The Weekly Standard;" and our CNN senior political analyst, Jeff Toobin. They're all part of the best political team on television.

Bill Clinton promised health care reform. It didn't exactly work. Going back to Nixon, they've been talking about energy independence. It hasn't exactly worked out.

Why does President Obama think he can achieve all these ambitious goals?

CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT: Timing. They look at things and they say, first of all, that people do understand the connection between the high cost of health care and what that does to businesses. And when Hillary Clinton, as first lady, tried to do health care, people really said, oh, I like my health care, actually. Now people are saying I'm scared I'm going to lose my health care. So it's a whole different environment and that's why he thinks it's possible.

BLITZER: She makes a good point, because it's not just those folks who have health insurance, it's a lot of folks -- millions who have health insurance but don't think it's adequate or they're afraid they're going to lose it.

STEPHEN HAYES, SENIOR WRITER "THE WEEKLY STANDARD": Right. I think Candy is absolutely right. I would say that it's timing and numbers -- and not just the numbers that we're talking about. I mean there's a sense in Washington right now that we're talking about monopoly money. Nobody really understands how big this is. And what I think what Barack Obama has done is go bold in his -- in his first year.

It's what, I think, is a smart thing to do, because of the timing.

BLITZER: Is he raising, though, expectations -- because energy, education, health care, stabilizing the banks, economic recovery?

Wow! Any one of those would be an enormous challenge for any one president.

JEFFREY TOOBIN, CNN SENIOR LEGAL ANALYST: Well, if he gets even half of his agenda through, it would be the biggest domestic policy adventure probably since the Great Society or maybe even the New Deal.

But I think we are going to be looking at three people for the next two years -- Susan Collins, Olympia Snowe and Arlen Specter. Because they are the three moderate Republicans who can get Obama to 60 votes. And I think they are going to hold the key to this whole domestic policy agenda.

BLITZER: Because they learned, if they didn't know already -- and a lot of them knew -- that to get anything done in the Congress, you need not only the House, where there's a lopsided Democratic majority, but you need 60 out of 100 votes in the Senate to break down any filibuster.

CROWLEY: Absolutely. But he also needs to look out for his conservative Democrats. I mean I don't think it's just those three. Those three are the key if he's got all his Democrats in line. But there are some of these things -- and particularly if we go on and say, well, we need to put this much more in the bailout and we need to do this much more.

And as that number goes up, you're going to see those conservative deficit hawks on the Democratic side begin to sort of get squeamish.

BLITZER: Do you think there is a possibility, Steve, that more Republicans beyond the three we're talking about might be peeled off and join the president's camp on some of these crucial votes?

HAYES: I think it all depends, as it often does, on how popular he is. If he remains popular, if his numbers stay high and he gains additional legislative victories, Republicans are going to have no choice, I think, but to jump along.

But make no mistake, I mean, we're talking about a fairly radical transformation of government -- a vast expansion of government that should be, I think, at odds with what most Republicans campaigned on in the past.

BLITZER: And we heard from Robert Byrd, the senator from West Virginia -- the longest serving Senator. And he was critical of the president's decision to bring in all these czars, whether an energy czar or whatever, into the White House and to take a health czar to take over some of these responsibilities from cabinet members who have to be confirmed by the Senate.

Robert Byrd said this: "As presidential assistants and advisers, these White House staffers are not accountable for their actions to the Congress, to cabinet officials and to virtually anyone but the president."

He's a stickler for the U.S. Constitution, as you well know.

TOOBIN: He is. But I don't think this is a Constitutional problem, I think it's a management problem.

Inside the Obama administration, who's in charge of economic policy?

Is it Tim Geithner, the secretary of the Treasury or is it Larry Summers?

Who's in charge of environmental policy?

I think trying to get this ambitious agenda through with authority divided in this way -- I think it's a problem in terms of getting things done. I don't really see it as a Constitutional issue.

BLITZER: But when you ask who's in charge, Candy, the president of the United States is in charge.


BLITZER: And he can decide in the executive branch how he wants to divide up a lot of those responsibilities. So he can have a Larry Summers as his economic adviser in the White House and still have Tim Geithner as his Treasury secretary.

CROWLEY: Well, on the economic front, that's certainly been a pattern that other presidents have had. I think what Senator Byrd is talking about may be less about the Constitution and more about accountability. Because there you are in the White House, you don't have to go into the Congress about anything you said in there. It's called executive privilege. And I think that's what they are worried about.

And in some cases, certainly when Senator Daschle -- and they may have changed their minds and we'll see. But when Senator Daschle was the HHS nominee, they also were going to set up an office for him in the White House.

Well, how does that work?

He does something in the White House, but he doesn't have to talk about it?

So, I mean, I think that's what Senator Byrd is getting at.

BLITZER: Well, there is a National Security Council, a national security adviser who doesn't have to be confirmed. He's a staffer. And there's a secretary of State of a secretary of Defense.

So does Robert Byrd have a point? HAYES: Well, it's interesting, actually. I had a conversation with a senior Republican Senate aide this week, talking specifically about the National Security Council, which James Jones has said that he intends to expand. It's going to be a more powerful NSC. And I was told that that could draw some real resistance from members of Congress, both on the Republican side and the Democratic side, as an expansion of executive power.

BLITZER: Legally, do they have a problem by doing that?

TOOBIN: I don't think so. The president has so much authority to set up his staff the way they want. This will be a process of give and take. But in terms of a lawsuit, in terms of a legal ruling, I don't think the courts would get anywhere near this subject. This is really between Congress and the president.

HAYES: It's almost like Dick Cheney is advising Barack Obama on executive power.


CROWLEY: But presidents always do this, by the way.


CROWLEY: I mean presidents always want to get as much power as they can.

BLITZER: They want to be in control.

CROWLEY: Absolutely.

BLITZER: All right, guys, thanks very much for that.

From Brooklyn to South Africa, inner city students make a Journey for Change and an experience that they never dreamed of.

Plus, the action you might have missed in last night's speech behind the president and in the sidelines. CNN's Jeanne Moos has the joint session follies.

Stick around.



LOU DOBBS, CNN ANCHOR: Coming up on "LOU DOBBS TONIGHT" at the top of the hour, much more on President Obama's demands for tough new laws to regulate Wall Street -- one day after calling for a big expansion in the role of government in this country. But President Obama insists he does not want a socialist economy. We'll have complete coverage tonight.

Also, the United Nations is now threatening this nation's sovereignty -- our right to free speech with a so-called anti- blasphemy resolution that targets anyone who criticizes Islam. We'll have a live report from the United Nations. And we'll be joined by author and "Vanity Fair" columnist, Christopher Hitchens.

And the Supreme Court now considering a case at the center of the battle to stop illegal aliens from stealing your identity. That special report and we'll be joined by two attorneys arguing the case.

Please join us for all of that, all the day's news and a lot more at the top of the hour.

THE SITUATION ROOM returns right after this.


BLITZER: Jack Cafferty is joining us once again with "The Cafferty File" -- Jack.

CAFFERTY: Indeed, I am. Thanks, Wolf.

The question this hour: What are the most important priorities for the nation at this time and which of them can wait, based on some of the things Barack Obama talked about last night in his address to the joint session of Congress?

Maureen writes: "Reforming public education -- priority. The next generation must be able to compete with the rest of the world or we will become a Third World country."

Laura in Texas: "Jack, taking care of the environment cannot wait. Obama needs to take -- make green initiatives his number one priority because the next generation may not be able to clean up the damage that we have caused to the Earth."

Alex, also in Texas, Weatherford: "The energy and environmental crisis need to take a back seat while we stabilize the economy and the war effort. We're not going to fix those future problems if we don't deal with the more immediate ones first."

Steve, Cedar Park, Texas: "I'd say the financial system and the housing problem should be addressed right away. The health care system, well, maybe wait on that. But who am I, just another guy with no health insurance."

Dennis in Sacramento, California: "Bringing jobs back -- the ones we lost to other nations in the last 10 years -- would be a good start. Then have a NAFTA tea party and throw it away."

And Julie in Florida writes: "We dug long and deep to get into this mess. Everything is a priority. Solving the key issues -- jobs, education, health care, green energy, returning our service men and women home -- these are all necessary to dig us out of this hole. It's time to wake up the sleeping giant -- or is he sleeping in? We'll soon know."

The question -- you can go to my -- if you didn't see your e- mail... (LAUGHTER)

CAFFERTY: I'm new at this.

If you didn't see your e-mail here, you can go to my blog at and look for yours there among hundreds of others.

I got the pages of my script out of order (INAUDIBLE)...

BLITZER: You'll get it eventually, after saying it a few times. You'll get it.

CAFFERTY: And once -- once in a while The Cafferty File makes an error.

BLITZER: Yes, me, too. All the time.


BLITZER: All right, Jack.

Thank you very much.

Recently, a group of inner city African-American students took a special journey to South Africa.

Here's CNN's Soledad O'Brien with a preview of her award-winning series, "BLACK IN AMERICA."



SOLEDAD O'BRIEN, CNN CORRESPONDENT (voice-over): It took interviews...

UNIDENTIFIED CHILD: Because it will make me change my life.

O'BRIEN: Essays, recommendations and 18 hours...

UNIDENTIFIED FEMALE: Just stick to your mentor and stay together.

O'BRIEN: get these 30 kids from Bushwick, Brooklyn 8,000 miles to Johannesburg, South Africa.

Bushwick is a poor community and many of these children are on the receiving end of government aid.


O'BRIEN: But on this trip, they'll be givers -- volunteering in South Africa's shantytowns, where every single person lives in crushing poverty.

UNIDENTIFIED FEMALE: Do you need stuff for school?

UNIDENTIFIED CHILD: Yes, I need stuff for school.

UNIDENTIFIED FEMALE: Yes, you need your stationery and you need your books.

O'BRIEN: Home is a tin shack. The toilet is at the end of an alley. There's no money for school. The program is called Journey for Change and its purpose is to give kids from a troubled community, plagued by crime and drugs and dropouts, confidence, hope and opportunity.

MALAAK COMPTON-ROCK, FOUNDER, "JOURNEY FOR CHANGE": I thought by bringing these kids here and seeing what real poverty is and also seeing kids who are dying to go to school, dying to learn, that they would then take advantage of not only the blessings that they have in the U.S. but then use those blessings to continue to serve.

O'BRIEN: Malaak Compton-Rock is a tireless advocate and fundraiser for these children.


O'BRIEN: In South Africa, they meet children who lack everything -- food, parents and something many of the Bushwick kids don't take advantage of -- free school. And they experience a culture they never dreamed of.


O'BRIEN: How will it change them?


O'BRIEN: And will those changes last?


O'BRIEN: So, Wolf, that's a little bit of a preview from "BLACK IN AMERICA 2," which will air in July. Tonight, we re-air "BLACK IN AMERICA." We update some of the stories that so many people were following so closely from last year. So "BLACK IN AMERICA" will air tonight, "BLACK IN AMERICA 2" will air tonight night. And then, at 11:00 p.m. Eastern time, tomorrow night, Thursday night, we'll give you a longer preview, an hour long discussion and preview from some of our stories for "BLACK IN AMERICA 2."

The entire four hour documentary, Wolf, will air in July -- back to you.

BLITZER: And for those who saw it, you went back and you updated it. And there's new material that we're going to see tonight and tomorrow night over the course of those four hours?

O'BRIEN: Yes, absolutely. There are so many families that people literally fell in love with and were very interested in knowing how their situations worked out. So we'll have updates on those families. You'll know what's happening to them right now.

BLITZER: 8:00 p.m. Eastern tonight -- a little more than an hour from now. And tomorrow night. Four hours of excellence in television.

Soledad, thanks for doing this.

O'BRIEN: Thanks, Wolf.

BLITZER: From man hugs to back rubs, Jeanne Moos is handing out her awards for the "Moost Unusual" moments during President Obama's address to Congress last night.

Stay with us.



BLITZER: Most eyes, of course, were on President Obama during his speech to the Congress last night. But our own Jeanne Moos was paying very close attention to some other things going on in the room.

She hands out awards for the "Moost Unusual" moment.


JEANNE MOOS, CNN CORRESPONDENT (voice-over): Up, down, up, down. Let's give a hand to the one with the most ups and downs.

(on camera): The Jack in the box award goes to House Speaker Nancy Pelosi.

OBAMA: It will not wait another year.

Our jobs overseas...

Halfway around the world...

MOOS: She was usually first. She clapped loudest.

OBAMA: ...whose parents work full-time.

MOOS: She left Joe Biden struggling to keep up...

OBAMA: And...

MOOS: Though on rare occasion, they were in sync.

OBAMA: We can make that commitment here tonight.

MOOS: She even gave Joe...

OBAMA: Because nobody messes with Joe

MOOS: ...a standing ovation. The last time we picked on Nancy Pelosi was two years ago, when she took the prize for most blinking. At one point, we clocked her at 85 blinks per minute.

UNIDENTIFIED MALE: We were trying to do a shot with every drink -- or every blink.

MOOS: This year...

OBAMA: ...ends this war

MOOS: ...the award for slowest standing ovation goes to John McCain. Fastest for his size...

OBAMA: ...needs and values, the talents of every American.

MOOS: ...goes to Maryland Congressman Eli Cummings .

(on camera): The man hugger of the night prize goes to the president.

(voice-over): He was bear hugging his buddies, hugging even that persistent thorn in his side, Joe Lieberman. Hugging even arch conservative, Tom Coburn.

As ABC's George Will noted...


GEORGE WILL: I don't know when men started to hug each other, but hug they do.


MOOS: Jesse Jackson, Jr. Managed to get two presidential autographs before getting a hug and an invite.


OBAMA: All right. (INAUDIBLE).

JACKSON: We'll have you over.

MOOS: Hillary Clinton got a kiss on the cheek. Senator Barbara Boxer tried to give the president a little body rub.

Speaking of rubbing the wrong way...

(on camera): ...the uh-oh the mic was open moment belongs to MSNBC.

(voice-over): As Governor Bobby Jindal strode forth to give the Republican response, Chris Matthews was overheard saying, "Oh, God."



(END VIDEO CLIP) MOOS: Matthews later explained he was taken back by the stage craft -- perhaps mimicking the White House?

Meanwhile, the blogs were agog with a certain resemblance in mannerisms...


UNIDENTIFIED MALE: Americans can do anything.



MOOS: ...between Governor Jindal and Kenneth, the NBC page from the show "30 Rock."

As for the star of this show...

UNIDENTIFIED FEMALE: You just woke up America. Thank you.

MOOS: We don't know if he woke up America, but he did wake up Nancy Pelosi...

OBAMA: ...America to lead again.

MOOS: Jeanne Moos, CNN...

OBAMA: It's time.

MOOS: ...New York.


BLITZER: Leave it to Jeanne.

Thank you, Jeanne.

Tomorrow, here in THE SITUATION ROOM, President Obama -- as you know, he'll be sending his first budget proposal to the Congress. I'll speak about that and more with the budget director, Peter Orszag. We'll be talking about possible road blocks on both side of the aisle. The interview tomorrow in THE SITUATION ROOM.

Until then, thanks very much for joining us.

I'm Wolf Blitzer.

Up next, "LOU DOBBS TONIGHT" -- Lou.