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STATE OF THE UNION WITH JOHN KING

HHS Secretary Discusses Health Care Reform, Says Swine Flu Vaccine is Coming; Congressman Wants to Eliminate "Don't Ask, Don't Tell"

Aired July 12, 2009 - 20:00   ET

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


WOLF BLITZER, CNN HOST: This is our "State of the Union" report for this Sunday, July 12th. I'm Wolf Blitzer, in for John King.

President Obama wants Congress to deliver a health care reform bill for him to sign this year. But can the United States afford to implement ambitious and expensive changes with an ailing economy? And what role does the government have in any final plan? In an exclusive interview, the health secretary Kathleen Sebelius outlines the Obama administration's case.

Plus, James Carville and Mary Matalin. They're both here together. They'll weigh in on the health care reform battle. Plus, news today that the former vice president, Dick Cheney, ordered the CIA to withhold sensitive information from Congress.

Also, President Obama in Africa. Our own Anderson Cooper brings us an exclusive interview from a castle that was at a center of the slave trade. It's a remarkable interview with America's first African-American president.

That's all ahead this hour on STATE OF THE UNION.

Capitol Hill, the U.S. Congress, where they're debating health care reform. While President Obama spent the past week overseas by tending to global matters, his administration pressed ahead with its effort to revamp the U.S. health care system.

The vice president Joe Biden announced a new agreement with the hospital industry to help pay for reforms, but there are still major issues to resolve, including whether to tax health care benefits in order to finance a final reform plan.

Here to outline the Obama administration's view is the Health and Human Services Secretary Kathleen Sebelius.

Madam Secretary, thanks very much for joining us.

KATHLEEN SEBELIUS, U.S. SECRETARY OF HEALTH AND HUMAN SERVICES: Great to be with you.

BLITZER: How are you going to pay for $1 trillion if not more for this health care reform over 10 years?

SEBELIUS: Well, President Obama has outlined his preferred payment plans, about $660 billion in savings out of the existing system. So, money that's already in the system that's not making us healthier and going to procedures and practices that work very well and about $330 billion in a proposal that would cap the itemized deductions that the wealthiest Americans take. Return them to the level where they were in President Reagan's days.

The House and the Senate have slightly different variations, a lot of the same savings and they're looking at different funding...

BLITZER: Because the House version that Charlie Rangel, the chairman of the Ways and Means Committee, announced on Friday would tax the wealthiest Americans, additional tax, to help pay for the hundreds of billions of dollars that would still be needed if you make more than $300,000 a year or $400,000 a year, and make more than $1 million. You're going to be paying a lot more taxes in the years to come.

SEBELIUS: Well, the House has a version. There are a couple of different proposals being worked on in the Senate.

BLITZER: You like the House version?

SEBELIUS: I think that it's one of the ideas that will be discussed in the long run. I prefer the president's version, I think it makes good sense that, you know, again, the wealthiest Americans pay...

BLITZER: But you're open to the version of increasing taxes on richest -- the richest Americans to pay for health care for everyone else?

SEBELIUS: Well, I think the bottom line is, it's got to be paid for. And we all have a shared responsibility that we all need to play a role. The House and Senate version also have employers included, and individuals included.

And what's been remarkable, Wolf, is the stake holders who in the early '90s were the most vocal opponents of anything changing in the health care system are really at the table with their own suggestions of how to pay...

BLITZER: Just to be precise, you're open to Charlie Rangel's proposal.

SEBELIUS: Well, I think everything is on the table and discussions are underway.

BLITZER: Are you also open to taxing health care benefits that employers provide their workers?

SEBELIUS: Well I think, again, the president's made it pretty clear from the beginning, certainly during the course of the campaign and since then, that that proposal may well dismantle the current employer-based system.

He has always suggested that we want to build on the current system, 180 million people have insurance provided by employers. What we don't want to do is discourage employers from offering coverage.

BLITZER: But this is what he said back when he was a candidate in September of 2008. I'm going to play this little clip.

SEBELIUS: OK.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Everyone in America, everyone, will pay lower taxes than they paid in the 1990s under Bill Clinton at a time when the economy was growing and we produced 22 million new jobs.

(END VIDEO CLIP)

BLITZER: All right, so just to be precise, you're rejecting a proposal to tax health care benefits employees get from their employers?

SEBELIUS: Again, Wolf, the House and Senate are busily at work, and I think the president continues to re-emphasize that he has opposed the notion that we would tax health care benefits, continues to think that is not the best strategy to go forward.

If at the end of the day that's the chosen way, I mean, the House clearly doesn't have it in, the health committee doesn't have taxing benefits as part of the proposal. We're waiting to see what Finance comes up with. But he continues to work with the Finance Committee saying this is not the preferred strategy.

BLITZER: Not the preferred, but it's not necessarily completely being ruled out?

SEBELIUS: Well, no lines in the sand at this point. The most important thing is a health care reform bill passed this year, comprehensive reform because we can't afford to pay what we're paying right now. We're paying twice as much as any nation on earth, living sicker, dying younger, and that isn't good for any American.

BLITZER: Will the president accept health care reform that does not include a public option? In other words, public government-run health insurance companies competing with the private health insurance companies?

SEBELIUS: Again, he has said consistently and very strongly a public option is one of the strategies that will help lower costs, provide some competition for private insurers, and make sure that consumers in many parts of the country have a choice. Absent that, you won't have cost competition and you won't have choice.

BLITZER: So be precise, is the president going to reject any -- if the House and Senate says, you know what? We can do this with co- ops, we can do this with other ways, but there's not going to be a public government-run health insurance system. Is the president going to accept this? SEBELIUS: Well, I think you're going to hear from senators in a little while about a variety of strategies to get to a public option. There isn't one size fits all. So he -- I think, the president has said we can have -- the issues are competition and choice and how you bring that into the private marketplace. There probably are a variety of strategies, all of which are on the table.

The good news is that Congress is hard at work. We've got Republican senators working day in and day out with Democratic senators trying to figure out how to make sure reform happens this year. And they're working really hard.

BLITZER: When is the president going to say, you know what, enough, the House and the Senate, they've got their own version, I'm going to come up with a Barack Obama version that I want you guys to pass?

SEBELIUS: Well, everybody assumed that I had the 1,000-page plan in my purse as I traveled through the Senate for my pre-confirmation hearings.

What the president understands is that this package of legislation, this very comprehensive bill needs to be a bipartisan approach. It needs to be owned by the House and the Senate with lots of input from the administration.

That's exactly what's going on now. Progress is happening day in and day out, people are at the table. Senator Grassley is working hard with Senator Baucus and Senator Conrad and others.

I think we're going to have a bipartisan bill with not only votes from Republicans and Democrats, but lots of ideas from Republicans and Democrats to reform the health care system.

BLITZER: Let's talk about the swine flu. You're getting ready.

SEBELIUS: H1N1.

BLITZER: The flu season is going to be starting in the fall here in the northern hemisphere. It's going pretty wild right now in the southern hemisphere. Will there be a vaccine that will be ready when the flu season starts in the United States?

SEBELIUS: By mid-October, we will have a vaccination ready. When exactly the flu season starts, we can't predict.

BLITZER: Because millions of people, potentially, are at risk in the United States.

SEBELIUS: Well, we have about a million cases of H1N1 right now in the...

BLITZER: Around the world?

SEBELIUS: No, in the United States right now.

BLITZER: In the United States alone?

SEBELIUS: Yes. And 102 countries are seeing presentations of this disease. The good news is that it's not terribly lethal right now. We've had about 170 deaths, that's too many, but we know 36,000 people die every year with seasonal flu. So we're watching southern hemisphere, no vaccine, H1N1 mixing with flu right now.

We'll know a lot more as we move toward the fall, but we are preparing to keep Americans safe and secure.

BLITZER: Give us a preview of the announcement you're going to make tomorrow on vaccines.

SEBELIUS: Well, there'll be another $1 billion worth of orders placed to get the bulk ingredients for an H1N1 vaccination. Congress has agreed with the president that this is the number one priority, keeping Americans safe and secure.

BLITZER: Madam Secretary, thanks very much for coming in, good luck.

SEBELIUS: Thank you, great to see you.

BLITZER: Thank you.

President Obama even sees a health care bill, says he wants to see a health care bill on his desk by the end of this year. Lawmakers on Capitol Hill have to agree on what goes into it.

Up next, four key U.S. senators break down what needs to be done to reach a bipartisan agreement.

Also, Anderson Cooper's exclusive interview with President Obama in Africa. It's a remarkable interview from the exact location where millions of Africans were sold into slavery. You're going to see it right here on STATE OF THE UNION.

(COMMERCIAL BREAK)

BLITZER: Well, we just heard the Obama administration's view of health care reform. Now let's turn to four U.S. senators who are playing a key role in crafting a plan.

In his home state of New Hampshire, Republican Judd Gregg. And from her home state of Michigan, Democratic Senator Debbie Stabenow. Here with me in Washington, Republican Lamar Alexander of Tennessee, and Democrat Kent Conrad of North Dakota.

Senator Conrad, let me start with you. You just heard Kathleen Sebelius, the secretary of Health and Human Services, say the Obama White House is open to this House proposal that Charlie Rangel, the chairman of the Ways and Means Committee, has put forward to put additional taxes on the richest American families to pay for health care reform for almost -- for everybody else who doesn't have it yet.

Is that a good idea? SEN. KENT CONRAD (D), NORTH DAKOTA: Look, everything does have to be on the table. You can't negotiate properly without that rule in place. But I don't think the House proposal as I've heard it will be what's part of the final package.

I think there may be some request from those of us who at the highest levels of income in this country to pay a bit more. But there will be a much broader package of revenue as well as spending reductions in order to make this package work.

BLITZER: Yeah, are you open to the House version to consider a tax on people making more than, let's say, $250,000 or $300,000 or $350,000 a year, add 1 percent or 2 percent additional tax on their gross income to pay for health care reform?

SEN. LAMAR ALEXANDER (R), TENNESSEE: No, that's a bad idea, Wolf. What is on the table seems to be taxes like that more state taxes to support Medicaid, more cuts in Medicare, more employer taxes. What should be on the table -- and more government programs.

What should be on the table are more proposals like the one Senator Gregg has made or Senator Burr, Senator Coburn. There are 14 of us, Democrats and Republicans, who support the Wyden-Bennett plan, and that would give every American dollars with which to buy their own health insurance and could be done without adding a penny to the debt.

BLITZER: You want to tax benefits, health care benefits that employers provide to their employees as income?

ALEXANDER: I'm willing to stop giving tax deductions to people for Cadillac health insurance plans in order to give everybody a chance to buy their own health care insurance and not add a penny to the debt. I think that would be a good way.

BLITZER: No matter what their income.

ALEXANDER: No matter...

BLITZER: No matter what the income?

ALEXANDER: What it means is if we've got a Cadillac insurance plan and your employer gives you that, then some of it's going to be taxed. That money will be used to make sure we do -- we can't keep adding to the debt in the way we are.

BLITZER: Senator Stabenow, is that OK with you?

SEN. DEBBIE STABENOW (D), MICHIGAN: Well, Wolf, I think, realistically, the one thing that is off the table is taxing employee benefits. I think we'll see some other combination of things. But employees don't determine what insurance companies are going to charge them for their health care for their family. And I think that's pretty much off the table. What's most important...

BLITZER: Senator Alexander says it should be on the table. STABENOW: Well that may be his view. I respect that. But it is not I believe the majority opinion. But I think what's also very important in this discussion is that over half of the cost of reforming and changing the health care system is going to come with greater efficiencies, it's going to come with changing from quantity of tests to paying for quality, paying for health care not sick care.

I mean that's what makes it exciting.

BLITZER: But hundreds of billions of dollars, Senator Stabenow, are still going to be required and that money, according to President Obama, he wants a deficit neutral plan, doesn't want the taxpayers to be burdened with additional costs.

That's going to have to come from somewhere, and that's what I hear you saying is you don't want it to come from taxing health insurance benefits.

Let me ask Senator Gregg what he thinks.

STABENOW: That's correct.

SEN. JUDD GREGG (R), NEW HAMPSHIRE: What do I think about that issue?

BLITZER: Yes.

GREGG: Well, I think the UAW is calling the shots there, and that's why it's not on the table because they've got some very high- end health policies, and they don't want them to -- their union members to have to reduce those health policies.

But why don't we look at trying to control the rate of spending by looking at better quality delivery systems, which are more affordable? We've got a lot of excellent studies that tell us you can deliver a lot better health care at a lot less cost if you give people incentives to go out and buy health care intelligently, if you give employers the capacity to reward people for purchasing health care intelligently and giving up lifestyles which are basically counterproductive such as smoking.

BLITZER: Well, quickly, Senator Gregg, do you -- would you support, could you see yourself voting in favor of health care reform legislation that includes this public option, a public government-run insurance company to compete with the private insurance companies like Blue Cross and Blue Shield or United Health Care or some of these others?

GREGG: No, we do not want to go down the road that basically undermines our fundamental health care delivery by creating a state- run government system in this country and that's what a public plan is, it's a stocking horse for a single payer system.

BLITZER: Because Senator Conrad, you're not convinced that a public option would necessarily pass, that's why you've come up with your own compromise version of co-ops. Having these co-ops that wouldn't necessarily be completely public or private, it would be somewhere in the middle. You think that's passable?

CONRAD: I do. And really just to be clear, the cooperative plan is something that we see across many business lines in the country, very successful. The "Associated Press" is a co-op, we've got Ace Hardware as a co-op, Land O'Lakes, a $9 billion entity, is a co-op.

The beauty of it is that it does provide competition for insurance companies. But it is not government-run, government- controlled, it's membership-run, membership-controlled.

BLITZER: Could you support that, Senator Alexander, the cooperatives?

ALEXANDER: Well, it all depends. I mean, Blue Cross could probably fit under his definition of a co-op. The problem with a government-run plan would be something like this. Say the president said let's buy the rest of General Motors to keep Ford Motor Company honest. And that wouldn't matter unless he gave the government car some advantage.

So he might say, well, all your repairs are going to be at a very low cost, but all of the mechanics might say, we're not going to -- we're not going to work on the government car. That's what you have with a government plan today with Medicaid. 40 percent of the doctors won't serve Medicaid patients because of the low service and it's the only option that people have.

BLITZER: I want to ask Senator Stabenow. I'll rephrase the question for Senator Stabenow. Could you support that does not include a public option?

STABENOW: Well, my first choice and very strong choice is a public option. And I have to say, Wolf, that what my friends are saying, Senator Gregg and Senator Alexander, really are scare tactics that have been put forward by folks that don't want to change the system because they make a lot of money off the current system right now.

BLITZER: Very quickly, all four of you, if you can give me a yes or no answer, I'm going to play a clip of what the president of the United States said in an exchange with a reporter in Italy on Friday and I want your answer. Listen to this.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: Is it pretty much a do or die by the August recess?

OBAMA: I never believe anything is a do or die. But I really want to get it done by the August recess.

(END VIDEO CLIP)

BLITZER: Will there be legislation on the president's desk, Senator Gregg, by the August recess? GREGG: On health care, I think that's highly unlikely since the Finance Committee doesn't even have a bill drafted yet. And we're in the middle of the Sotomayor hearings for this week and then we're going to be debating her nomination for a week before we adjourn for this August recess.

BLITZER: Let me ask the chairman. What do you think?

CONRAD: I think we'll be through the Finance Committee by the August recess and I think that's a realistic goal. You know, there really is plenty of time. Congress is going to be in session until Christmas Eve.

BLITZER: What do you think?

ALEXANDER: No, there's no reason to rush. We need to get it right, not add debt, not have a Washington takeover.

BLITZER: Is the president going to be disappointed, Senator Stabenow?

STABENOW: Well, I think he's going to be very pleased with the progress we're making. I believe we're going to move this through the Finance Committee. We're going to get it done as quickly as possible. The most important thing is to get it right. The American people have waited for a long time.

BLITZER: A new revelation that the CIA withheld information about a secret intelligence program from Congress on direct orders from then Vice President Dick Cheney.

Veteran political strategist James Carville and Mary Matalin. They're here with their take on that. And a lot more. That's next on STATE OF THE UNION.

(COMMERCIAL BREAK)

BLITZER: Welcome back now. The sound of Sunday where we fill you in on all of what's been happening on the Sunday talk shows. The leading topic today, health care reform here on STATE OF THE UNION.

I asked the president's health secretary, Kathleen Sebelius, what she thought of a proposal by House Democrats for a surtax on the wealthiest Americans to help pay for reforms.

(BEGIN VIDEO CLIP)

BLITZER: Just to be precise, you're open to Charlie Rangel's proposal.

SEBELIUS: Well, I think everything is on the table.

(END VIDEO CLIP)

BLITZER: Republicans were quick to shoot down that surtax proposal. (BEGIN VIDEO CLIP)

SEN. JON KYL (R), ARIZONA: At least 55 percent of the income that would be generated by this surtax directly hits the entrepreneurs who run these small businesses. It would be a job killer. It would be exactly the wrong to do any time but especially when we're in the middle of a recession.

(END VIDEO CLIP)

BLITZER: But many Democratic senators are ruling out another proposal with tax employees' health benefits.

(BEGIN VIDEO CLIP)

SEN. CHARLES, SCHUMER (D), NEW YORK: I think what we've learned over the last week that on both sides of the aisle, people do not want to tax the benefits. Democrats and Republicans. And given what the House has done, given that a majority of Democrats are against taxing benefits, no, I don't think that's going to happen.

(END VIDEO CLIP)

BLITZER: The other big story in the Sunday conversation, another revelation that shortly after the 9/11 attacks, the then Vice President Dick Cheney ordered the CIA to withhold information from Congress about a secret intelligence program. Democrats, even some Republicans, were critical of the former vice president. And Republican Senator Judd Gregg that both parties shared at some of the blame.

(BEGIN VIDEO CLIP)

GREGG: This national attempt by some of our colleagues on the other side of the aisle that basically undermine the capacity to protect and develop intelligence is, I think, going to harm us in the long run. Now, yes, this is wrong. What if -- somebody told the CIA not to inform the appropriate members of Congress on information they should be informed of, that's wrong.

(END VIDEO CLIP)

BLITZER: As you can see we've been watching all the other Sunday shows so you don't necessarily have to.

Joining us here in Washington two political pros that you'll only see together right here on STATE OF THE UNION. The Democratic strategist and CNN political contributor, James Carville, and the Republican strategist and CNN contributor, Mary Matalin.

Guys, thanks very much for coming in.

MARY MATALIN, CNN POLITICAL CONTRIBUTOR: Morning, Wolf.

JAMES CARVILLE, CNN POLITICAL CONTRIBUTOR: Thank you. BLITZER: Your former boss, the former vice president of the United States, as you saw that front page "New York Times." Let me put it up and show our viewers. "Cheney is linked to concealment of CIA project. Congress was in dark." Panetta, the current CIA director, said to have oversight panels to -- of direct orders.

How big of a problem, potentially, is this for the former vice president?

MATALIN: It's a big problem for the administration.

BLITZER: The Obama administration.

MATALIN: This is very suspect timing. The president's agenda is almost in shambles. His numbers are dropping. Isn't it coincidental they gin up a Cheney story? What the "New York Times" is saying in that story is they're accusing the vice president of telling, of ordering the CIA to not tell the Congress about a program that didn't exist.

It wasn't operational, it was never operational. Further, there's a reason, which he had every right to do, even if it was operational. There's a reason that executive branch withholds information, which they're entitled to do because when it leaks it renders said programs ineffective or inoperative and right now Barack Obama is threatening his first veto on the same issue.

What is the -- how many people get to know what at what level? Because the more people that know, the more it leaks and, as did our surveillance program, our finance tracking program and then the enemy knows what it is.

I'm not saying in any way or suggesting that that story is true. But, again, the timing of it is highly suspect. Accusing the vice president of ordering something stopped that didn't exist while the administration is fighting with the CIA.

BLITZER: The timing of the story is related directly to Leon Panetta apparently telling Congress, you know what, there was this very secret program, we don't know what it was. But the then vice president told the CIA, don't share this information, even with the leadership of the House and Senate.

CARVILLE: And I think the word is fully operational. 98 percent operational. I mean, Washington, that's a great kind of statement. I think what's going to happen here is that every week something like this comes up. I don't think that Leon Panetta -- he's been pretty fiercely independent guy.

I don't think he'd be in part of any co-conspiracy to sort of try to save the president's agenda or anything like that, but I think that Eric Holden and people are now giving some serious consideration into looking at any of this.

And does anybody think this is going to be the last one or that we know most certain it is going to be more revelation. It might be perfectly legitimate what they did. But there are enough questions being raised where it's going to be very hard to take this thing away.

BLITZER: And Mary, the chair of the Senate Intelligence Committee, Dianne Feinstein, is obviously very, very concerned. Listen to what she said today.

(BEGIN VIDEO CLIP)

SEN. DIANNE FEINSTEIN (D), CALIFORNIA: I think you weaken your case when you go outside of the law. And I think that if the intelligence committees had been briefed, they could have watched the program, they could have asked for regular reports on the program, they could have made judgments about the program as it went along.

That was not case because we were kept in the dark. That's something that should never, ever happen again.

(END VIDEO CLIP)

MATALIN: She doesn't know. No one knows. No one knows what program they're talking about. No one knows what not operational means. But it was within the law, it is within the law, it exists within the law, as you noted in the earlier hour, for the executive branch to withhold anything they want, which I'm going to predict right here and now that this president is going to do at some point in time.

The larger story and the more damaging story and why I think the Obama administration is walking into a buzz saw here is what Eric Holder is suggesting he is going to do in this week's "Newsweek" to backwards prosecute and investigate these people, these intelligence gathers will have such...

BLITZER: Those who were involved in the interrogation techniques. The harsh interrogation techniques.

I want to play for you what, John Cornyn, said earlier today, he's the Republican senator from Texas, James. Listen to this because this is exactly on the point that Mary is just making.

(BEGIN VIDEO CLIP)

SEN. JOHN CORNYN (R), TEXAS: This is a terrible trend, and I hope that this attorney general listens to the president who says we need to look forward, not backward. This is high-risk stuff because if we chill the ability or the willingness of our intelligence operatives and others to get information that's necessary to protect America, there could be disastrous consequences.

(END VIDEO CLIP)

BLITZER: And take a look at this cover of the new issue of "Newsweek" magazine. You can see it right here. I'll show our viewers. "Holder versus Bush. Torture and the attorney general's moment of truth."

You know, it's a problem right now for the president of the United States who says he doesn't want to look back, he wants to look forward, but if Eric Holder says there's should be a special counsel named to investigate these interrogation techniques, that's clearly looking backwards.

CARVILLE: It's not going away. And there's going to be more -- does anybody think that these stories are going to stop coming out? Of course they're not going to stop coming out.

And if Eric Holder says, look, I don't know how this is going to come out. I don't think that the president, I don't think the president's chief of staff and all the people in the White House really want to deal with this. But the attorney general says, you know, I took an oath to uphold the laws of the United States.

In my view, this is a potential violation of that law. I cannot not do this. I don't -- there seems to be a position that he's moving toward. Perhaps there's some kind of a middle ground here where we can find out what happened and, you know, the president has the power to pardon people.

Any number of things can happen but I don't -- the momentum of this thing is starting, you can just feel it starting to move. If this is the last story we see, probably this thing will just, will recede a little bit. But if there are two, three more stories on top of this, as most people think is quite likely, the momentum of this thing is going to continue the bill.

BLITZER: Because as you know there's been a discussion of having separate investigations of the Justice Department lawyers who authorized the harsh interrogation techniques, what some call torture, and now this investigation of either CIA employees who were involved in the interrogation or because I'm told that most of them, if not all of those who actually interrogated these three suspects and agents to waterboarding and other techniques were contract employees.

They weren't CIA officers. They were contractors from outside who were brought in to actually do the interrogation.

MATALIN: Nobody was off the hook. The attorney general, the president, the entire administration takes an oath to protect and defend. Protecting and defending in the case of this enemy, this asymmetrical war that we're in, is intelligence. It's the key.

And they're undermining our ability to gather intelligence by going backwards and investigating and prosecuting the intelligence gatherers, the lawyers who rendered the opinion, it is politicization and criminalization of political (INAUDIBLE), and every time -- I come back to the timing.

Every time they get in trouble, which the president's poll numbers are slipping and his health care and global warming initiatives are under assault, they dredge up a Darth Vader story so they can say that they're...

BLITZER: I guess the question is this, James. At a time when the president is trying to get health care reform passed. They got an economic stimulus package that may or may not be working the way you thought it would. Enormous international headaches whether in two wars, Iran, North Korea, all sorts of other issues.

Is this what you want to see the administration?

CARVILLE: I don't think the administration wants to deal with this. All right? But these stories keep coming out. Apparently there are any number of people I think that laws might have been broken. You can't suspend. You're supposed to protect and defend the constitution.

If you're the attorney general, he believes that laws were broken. I got to do something. But don't think that President Obama, or people say, gee, we want to deal with these stories right now. They don't need anything else. They came in, they got a pretty full plate here.

But these stories keep coming and people -- and there are going to be more stories coming and we don't know the extent of them. What I'm saying is that in all likelihood this is going to continue. There's going to have to be a way to deal with this. And it's the attorney general or they're going to appoint a special prosecutor or they're going to get a federal judge or a commission or something like this. But this stuff is not going to go away.

BLITZER: Very hypothetical question. If the current vice president Joe Biden said, you know what, there's a very sensitive intelligence program that's under way right now. I'm going to go to the CIA and tell Panetta and company, don't share this information with the top eight leaders of the House and the Senate Democrats and Republicans. It can't go out.

Would it be OK for Joe Biden to make that unilateral decision?

MATALIN: It is within their -- part of the law for him to be able to do it. He would have to be very, very selective, and I don't think politically you would want to withhold it from the top eight. But it depends on what it is. And in this case, we don't know what it is. We know that it wasn't operational.

The reason these stories keep happening. They're not just happening, Wolf, they're being manufactured for political reasons. This whole Panetta range of stories, (INAUDIBLE) of stories, was a cover for Nancy Pelosi.

BLITZER: It's a very serious charge you're making against Leon Panetta, the CIA director...

(CROSSTALK)

MATALIN: It's a very serious charge that he made against the vice president.

BLITZER: That you're saying he is involved in some political operation against the Republicans. MATALIN: I am saying that the House intelligence fans or proponents with Nancy Pelosi started saying -- misquoted or misrepresented Leon Panetta's use by saying that he said CIA had mislead Congress. Then they walked that back and said that no, they won't mislead Congress.

And then in the middle of that the story just comes out that accusing the vice president of not telling Congress, ordering the CIA not to tell Congress about a program that did not exist, was not operational.

BLITZER: Wrap it up, James.

CARVILLE: I mean, I just got to come back and said the stories said it wasn't fully operational. I don't know about 99 percent operational, and I don't think Leon would do anything that would hurt his country. I think he's an honorable man. I've spoken and by the way received a fee in all disclosure on a couple of occasions at the college out in Monterey Bay.

BLITZER: The Panetta Institute.

CARVILLE: In the Panetta Institute. But I -- and I don't think that he...

BLITZER: That was before he became CIA director.

CARVILLE: Before he became CIA director, yes.

MATALIN: Nor would the vice president, the former vice president, do anything other than what was in the best interest of this country. So, if you're suggesting that Leon wouldn't and somebody else would, I hope that wasn't your suggestion.

CARVILLE: We have an investigation and we'll find out. Maybe everybody is right.

MATALIN: And meanwhile, while we're investigating, Wolf, the CIA is saying, I am not gathering intelligence, I'm not doing anything. I don't want to put my family through this. I don't want to be prosecuted. You can indict a ham sandwich in this town, and if they feel like that's what's going to happen to them, their efforts to gather intelligence for our security is going to be greatly chilled.

BLITZER: But you admit they should do it lawfully and legally.

MATALIN: As the -- I'm 100 percent, 110 percent confident the vice president and the former administration did everything within the confines of the law.

BLITZER: Guys, thanks very much.

President Obama is back home from his overseas trip including a visit to Ghana. CNN's Anderson Cooper within the African nation as well and spoke with the president. We're going to bring you some of Anderson's exclusive interview. That's just ahead on STATE OF THE UNION.

(COMMERCIAL BREAK)

DON LEMON, CNN ANCHOR: Hello, everyone. I'm Don Lemon live at the CNN world headquarters in Atlanta. More STATE OF THE UNION in just a moment. But first I want to give you your headlines.

There has been an arrest in connection with the murder of a Florida couple known for their large family of mostly adopted children. The Escambia Country sheriff says 52-year-old Leonard Patrick Gonzalez -- there you see his face -- he has been arrested on a charge of evidence tampering.

Sheriff says there are more arrests to come. Byrd and Melanie Billings were killed on Thursday. Eight of their children were in the home at the time.

The space shuttle is not going anywhere tonight for the second time in as many days. NASA has scrubbed the scheduled launch of Endeavor. The shuttle was supposed to have lifted off in the 7:00 p.m. Eastern hour. But just moments before NASA backed off because of storms around a 20-mile radius of Florida's Kennedy Space Center.

The new launch time is tomorrow evening just before 7:00 p.m. Eastern. And whenever it happens, you can watch it live right here on CNN.

I'm Don Lemon. Those are your headlines. STATE OF THE UNION with Wolf Blitzer right after a break.

(COMMERCIAL BREAK)

BLITZER: Twenty-four newsmakers, analysts and reporters were out there on the Sunday morning talk shows. But only one gets the "Last Word." That honor today goes to Democratic congressman Patrick Murphy from Pennsylvania. He is joining us from Philadelphia.

Congressman, thanks for coming in.

REP. PATRICK MURPHY (D), PENNSYLVANIA: Great to be with you, Wolf.

BLITZER: If it's true that the former vice president of the United States, Dick Cheney, ordered the CIA not to share with leaders in the House and Senate some sort of classified intelligence program that was under way, we don't know what it was, would that be appropriate under some circumstances?

MURPHY: Absolutely not, Wolf. I mean there's a reason why we have three branches of government that are co-equal branches of government. And the fact that he -- you know, really put the CIA in a bad position saying, don't tell the Congress. Even those gang of eight, those select few members of Congress that really should know what's going on.

It's disturbing. You know when it comes to national security, well, a few know that politics should always stop at the water's edge. And I really think that the vice president put the CIA in a bad position here. These CIA personnel, they're just trying to do their job to keep our families safe.

BLITZER: You're on the House Intelligence Committee. Do you know what this program was? What's this controversial program that apparently the vice president thought was so secret, so important, it shouldn't be shared, the details should not be shared with the House and Senate Intelligence committees?

MURPHY: I have been briefed by Director Panetta as a member of the Intelligence Committee. And obviously, Wolf, I can't talk about it on TV or even in private because it's classified. But I will say that it's a program that, to Director Panetta's credit, he stopped immediately as the new CIA director.

And he went immediately to Congress, came and brought us together -- there's only a few of us that are in the intelligence committees in the House and the Senate. But brought us together and said, listen, I just found out about this, I want to be straight with you.

And we want to work, you know, with the executive branch. We want to work with these heroes in the CIA because listen, they're trying to keep us safe. But we cannot allow folks that take note to support and defend the constitution to really disregard a co-equal branch of government.

COLLINS: Should the attorney general of the United States, Eric Holder, ask for a special prosecutor or special counsel to investigate the Bush administration's behavior in some of these areas, especially the enhanced interrogation techniques?

MURPHY: Well, listen, I'm not going to tell Attorney General Holder how to do this job, but I will tell that in my job as a member of the intelligence committee, we're getting after this, and we're going to find out what was said, what was known, what happened because it is disturbing, no doubt about it.

Listen, I came back from 7:30 Mass this morning, and I read "The New York Times" of what happened, and I tell you, I was pretty upset, and I'm upset with the facts as they came out as related to me by the Director Leon Panetta.

BLITZER: Now you're trying a leadership role now and trying to get the U.S. military to move away from the "don't ask, don't tell" policy that bars homosexuals from serving openly in the United States military.

You're a veteran of the Iraq war, you've served in the military. Why now, in the middle of two wars, do you think it's a good time to move away from the Don't Ask, Don't Tell policy?

MURPHY: It's actually the best time to move away from it, Wolf, because we've discharged over 13,000 troops. That's over 3.5 combat brigades. Not for any type of sexual misconduct. If it's sexual misconduct, they should be thrown out. But just because of their orientation, just because they're gay, it doesn't make any sense whatsoever. Listen, when you're a paratrooper like I was in the 82nd Airborne Division, you care whether -- what race someone is or corps or creed, you don't care what their orientation is.

You care if they can fire an M4 assault rifle, whether they can kick down a door in Baghdad or Kabul and whether they can do their job. That's what you care about, and whether or not you can all make it home alive to see your family.

BLITZER: Thirteen thousand have been discharged since 1993 when the "don't ask, don't tell" policy was brought into line. Those who say, you know what, it's served pretty well and it's good for unit cohesion and morale for the troops that -- what do you say to people who say, you know what, this is a good idea, and keep it going the way it is?

MURPHY: Wolf, I ask those people why don't they think our young men and women here in America are professional soldiers, or as professional as the 24 other countries that have allowed our troops to serve openly. Even our strongest allies, Great Britain and Israel, allow their troops to serve openly.

It will not affect -- listen, troops or these heroes that are 18, 19, 20, 22 years old, they don't care about this. They care about whether or not they can the job done. And I tell you, it's disheartening when I hear them question the professionalism of our men and women in uniforms.

BLITZER: Do you have any reason to believe that the president of the United States who, during the campaign, since the campaign, has said, you know what? I think it's time to move beyond "don't ask, don't tell," but so far he hasn't done it. Do you any reason to believe he will take the first steps necessary to remove this policy?

MURPHY: Absolutely. Wolf, in fact, he's already has done that. He talked a week ago to the secretary of defense and the chairman of the Joint Chiefs of Staff and said, listen, be ready to implement a change in the "don't ask, don't tell" policy. He went, and now it's our job as a Congress to overturn that policy.

What the president -- President Obama does, he understands and has a healthy respect for a co-equal branch of government. And if he's not saying to his military, well, disregard what the Congress passed 16 years ago, no matter how wrong it might be. It was an act that Congress, Wolf, that put this law into place, this discriminatory law into place.

It will take an act of Congress to repeal it.

BLITZER: Do you have the votes?

(CROSSTALK)

MURPHY: We're going to have the votes when it comes to a vote, Wolf. And that's my job, to quarterback this through the House and get it to the president's desk after it gets to the Senate, to overturn this change in policy.

BLITZER: Patrick Murphy is the Democratic congressman from Pennsylvania. Congressman, thanks for coming in.

MURPHY: Thanks, Wolf. I appreciate it.

BLITZER: Up next, the challenges that come with rural health care. The nearest hospital is often miles and miles away. And many avoid getting into the most basic care simply because they can't afford it.

(COMMERCIAL BREAK)

BLITZER: Welcome back to STATE OF THE UNION. I'm Wolf Blitzer sitting in for John King.

Every week John likes to get outside of Washington and speak with you about the issues being debated right here in Washington. In John's "American Dispatch" this week, an up-close look at how many in rural America worry their unique concerns and challenges might not fit with Washington's debate over accessible and affordable health care.

(BEGIN VIDEOTAPE)

JOHN KING, CNN CHIEF NATIONAL CORRESPONDENT (voice-over): Clay, West Virginia is tucked into the remote rolling hills of coal country. The nearest hospital is 50 miles away on these winding rural roads. With the poverty rate approaching 30 percent, many here can barely afford to drive, let alone the care, like Carl and Elizabeth Walls.

CARL WALLS, CLAY, WEST VIRGINIA: If life and death depended on money, I would have to die.

KING (on camera): You would be dead right now.

C. WALLS: I would have been dead right now.

KING (voice-over): Carl had a massive heart attack a little more than a month ago. First, along an ambulance ride and blood thinners at a rural hospital. Then an emergency helicopter medevac to Charleston.

C. WALLS: I (INAUDIBLE) she was back with dignity (INAUDIBLE) that you could ask. And in spite of we may not had any money. As if I were a king, you know?

KING: Most of their life savings went to pay for back surgery and other health issues Elizabeth had a few years back. She has diabetes and is legally blind.

(on camera): Why won't you go to the doctor?

ELIZABETH WALLS, CLAY, WEST VIRGINIA: Because I can't pay for it. And I -- you know I could go and I get bills, and I can't pay those bills, so...

MURPHY: Thousands and thousands of dollars worth of bills come in, and what can you do about it?

KING: But so you'd rather not go to the doctor than to have a bill come that you can't pay?

E. WALLS: Right.

DR. SARAH CHOUNARD, CLAY PRIMARY HEALTH CARE CENTER: Did you get in touch with her regarding that repeat on the mammo?

KING (voice-over): It is the dilemma Dr. Sarah Chounard faces every day. Trying to convince the uninsured not to wait for the heart attack, cancer diagnosis or some other major problem, to seek medical care.

CHOUNARD: We offer sliding fee payment scales. If they're at 100 percent federal poverty level or worse, then they owe us $5 only and the rest of their care is waived. 35 percent of our patients are uninsured and so we have to come up with ways to deliver health care at low cost and try to figure out what to do with their health care once they're outside of these walls.

KING: The urgent focus here is preventive care because it's the right medical approach and because Dr. Chounard and her colleagues know many of their poor and uninsured patients will ignore suggestions to see expensive specialists.

CHOUNARD: We see a large portion of diabetics, hypertensive and hyper cholesterol patients. Our hope is that we keep people away from needing extensive health care services. So our role in a rural setting is key.

The question is, how do we keep paying for it? How do we keep getting discounted care? How do we afford to keep the doors open?

KING: A big chunk of the federal budget comes from federal grants. But Dr. Chounard says she hasn't heard much talk during the reform debate in Washington about how to protect places like this in small town America.

CHOUNARD: It will be interesting to see what happens if they come up with universal coverage. What will our role as a federally qualified health center be? How is our role defined after that?

I worry that we have patients here who will maybe not fall into some category and somehow slip through the cracks.

KING: Carl and Elizabeth Walls shared that concern. They sold two small businesses, watched the money go to health care bills, and now have thousands of dollars more because of Carl's heart attack.

E. WALLS: You know, we have worked all of our life and tried, and we can't seem to get any programs that's worked for us. KING: It's not that the Walls or Dr. Chounard oppose the idea of universal coverage. To the contrary. It's just the sense that when there is talk of big change, people like them and places like this so often get left behind.

(END VIDEOTAPE)

BLITZER: John King reporting. I'm Wolf Blitzer in Washington. John King will be back next Sunday.

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