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THE SITUATION ROOM

End of Recession Near?; President Obama Continues Health Care Push

Aired August 12, 2009 - 18:00   ET

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


WOLF BLITZER, CNN ANCHOR: A Christian ministry is taking an unconventional approach to helping members cover their medical bills.

CNN's Kate Bolduan explains how it works and whether it could work for you.

I'm Wolf Blitzer in CNN's command center for breaking news, politics and extraordinary reports from around the world. You are in THE SITUATION ROOM.

The Federal Reserve hasn't been this enthusiastic about the U.S. economy in more than a year, the Fed now declaring that the longest period of decline since the Great Depression is leveling out. That's why the Central Bank left interest rates alone today.

If you need more convincing, look at this -- 57 percent of economists surveyed by "The Wall Street Journal" say the recession is already over. That's what the experts say.

Let's get a reality check from the heartland.

Our chief business correspondent, Ali Velshi, is traveling on the CNN express. He is in Wentzville, Missouri, right now.

What are the folks saying to you, Ali, about the economy?

ALI VELSHI, CNN CHIEF BUSINESS CORRESPONDENT: Well, Wolf, as you can imagine, people in the heartland aren't waiting with bated breath to find out what economists on the East Coast or the Federal Reserve is saying about the recession being over.

They feel that times are still tough. Now, the Fed says it's bottoming out. That doesn't mean it's supposed to be feeling better. They just say it is going to be getting better. Let's see what people told me in Wentzville, Missouri.

(BEGIN VIDEOTAPE)

VELSHI: There are economists saying this recession is over. You live in this town. You see the businesses in this town, the people who live here. What's your thought on that?

UNIDENTIFIED MALE: Well, if the recession is over as they say, I figure it is going to take me personally about five or six years just to gain what I have lost over the last couple years.

UNIDENTIFIED FEMALE: No, my personal recession is not over.

UNIDENTIFIED MALE: It's going to take six, nine months, a year before the job loss slows down and stops and we start turning around and adding jobs.

UNIDENTIFIED FEMALE: I look at my own 401(k) and, you know, I didn't get hit as hard as others, but it's not back where it was. And I feel I will probably be working to 70 or 80, until it gets back to where it is.

(END VIDEO CLIP)

VELSHI: Well, hopefully, we will start feeling a little better than that, people having to work until 70 or 80 years old.

But the reality, Wolf, is that until home prices level off, they might be doing that now on a national level, but they level off in your community and start going up, and until we stop bleeding jobs in this country, many Americans are not going to feel like this recession is coming to an end, even if it really is, Wolf.

BLITZER: Even if the Federal Reserve says it is leveling off, people have to feel that first.

Ali, thanks very much.

The economic rebound is coming with a big price tag. The federal deficit has climbed to another record high of almost $1.3 trillion so far this budget year and it is not over yet. The Treasury Department reports more than $180 billion in red ink July alone. That's higher than expected.

At this rate, by the way, administration officials project that the federal deficit will top $1.8 trillion when the fiscal year ends September 30. That's four times higher than last year. The budget deficit was about $450 billion, now approaching almost $2 trillion.

The debate over skyrocketing health care costs is playing out again today in schools and community centers across the country, but a town meeting -- at a town meeting happening right now in Iowa, certain things are standing out, not necessarily because it is getting ugly, but because it is being held by a powerful Senate Republican.

We are talking about Charles Grassley. He is on the panel that's been trying to hammer out a compromise reform bill with Democrats. And guess what? He is not sounding very optimistic right now.

(BEGIN VIDEO CLIP)

SEN. CHARLES GRASSLEY (R), IOWA: There might be something that comes out of our committee. But who knows. Maybe nothing will come out of our committee. I mean, it may not be at least nothing that I agree with.

And so, maybe I will be pushed away from the table. I don't know. It could be that with what the president said yesterday afternoon or yesterday morning in Portsmouth or whenever he had his meeting there, there was some indication that he may be ready just to move ahead in a very partisan way.

(END VIDEO CLIP)

BLITZER: Our White House correspondent Dan Lothian, is standing by at the North Lawn of the White House.

Let's go to our senior political correspondent, Candy Crowley, though, first. You are with Senator Grassley at this town hall meeting that is going on right now.

Can we say this was a red flag that the senator put forward today?

CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT: Listen, this is as negative as I have heard Senator Grassley about the prospects for the Senate Finance Committee, that small group within the Senate Finance Committee, actually getting to some conclusion.

In fact, just now, at this town hall meeting, he said, listen, I'm not going to walk away from these meetings, but I think I may be shoved away. And he talked about coming back from the August recess and how the Democrats may just plow forward.

He seems, when I talked to him earlier in the day, to be upset about a quote that he read that the president said yesterday when he was in New Hampshire that he would like things to be bipartisan, but when he hears all these stories, what he wants is to do something for the American people. That was a red flag to Senator Grassley that the president intends to kind of push this through in a partisan manner. And it sounds like to him that is what is happening.

BLITZER: Candy is competing with a town hall meeting that is going on right now over there.

Let me bring in Dan Lothian, our White House correspondent.

Dan, White House officials for days now they have been saying, you know what, they would love to get a bipartisan piece of legislation through the House and the Senate, but if necessary, they are willing to do it with only Democrats given the enormity of what's going on and what's at stake. Is that right?

DAN LOTHIAN, CNN WHITE HOUSE CORRESPONDENT: That's right. They are certainly signaling that.

The president has said all along that he really wants a bipartisan effort when it comes to health care reform. But they really are, it appears, making it clear that the president is willing to do this without Republicans. In fact, I talked to a top aide and asked him, is the president saying that he is willing to do this with or without Republicans? And he said -- quote -- "with those that want to see health care reform" -- Wolf.

BLITZER: Do White House officials, Dan, believe the president's message -- he had a town hall meeting yesterday, he's going to have another one in Montana, another one, I don't know where, but someplace else, Colorado, I think.

LOTHIAN: In Colorado.

BLITZER: Do they feel his message is getting out?

LOTHIAN: Well, they certainly know that there is a lot of noise out there. And they have been spending the last few days trying to clean up the message, the health care reform message, and this after the president has held more than a half dozen town hall meetings. But there are still a lot of Americans out there who are skeptical. And the White House believes that this noise could present some troubles. Take a listen.

(BEGIN VIDEO CLIP)

LOTHIAN: And is there any concern at all that, if this misinformation machine continues and -- and the record can't be corrected, as the White House would like it to be, that it could potentially make it more difficult to get health care reform across the...

(CROSSTALK)

ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: Well, look, if -- if the debate is dominated by something that's not true, of course. I don't think the president believes, though, that when all is said and done that -- that most people will make their decisions on something that is false and something that has been said is false.

(END VIDEO CLIP)

LOTHIAN: So the White House believes that these town hall meetings are a great opportunity, are valuable, a chance for the president not only to inform but to knock down what they believe is false information about health care reform that's out there. And so that's why the president will be hitting the road again this weekend, Wolf.

BLITZER: Yes, he is going to Colorado and Montana.

Candy, Senator Grassley suggests the anger out there really is nothing new?

CROWLEY: I'm sorry. One more time, Wolf. We are just sort of competing with a rather large crowd.

(CROSSTALK)

BLITZER: ... that the anger out there at these town halls really is nothing new?

CROWLEY: Well, you know, he is giving -- this is his 75th town hall meeting this year. And what he has seen so far this year beginning in February when he did them during the February break is that his crowds are two to three times as big as they have been in previous years. And he says, he thinks it is a lot of things.

It is the stimulus plan that many people think Congress didn't really think through. He believes it is the bailouts. These are the issues that he is hearing about, the spiraling deficit, as well as just government spending in general. So he thinks health care has just compounded this. And of course now most of the questions he gets here are about health care, but he still hears about these other subjects as well.

So, all this year, he has been seeing this groundswell build in Iowa, at least.

BLITZER: Candy Crowley, back in Iowa for us, thanks very much.

President Obama threw a celebration of sorts today for the Supreme Court's first Latina justice. He welcomed Sonia Sotomayor to the White House for a private celebration and a public victory lap of her confirmation.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: we celebrate how, with their overwhelming vote to confirm Justice Sotomayor, the United States Senate, Republicans and Democrats, tore down yet one more barrier and affirmed our belief that in America the doors of opportunity must be open to all.

SONIA SOTOMAYOR, SUPREME COURT JUSTICE: It is this nation's faith in a more perfect union that allows a Puerto Rican girl from the Bronx to stand here now.

(CHEERING AND APPLAUSE)

SOTOMAYOR: I ask not just my family and friend friends, but I ask all Americans, to wish me divine guidance and wisdom in administering my new office.

(END VIDEO CLIP)

BLITZER: After the party, Justice Sotomayor has lots of work to do. She's busy hiring clerks, getting ready for the court to convene early on September 9, by the way, to hear an important campaign finance case. She is going to be busy.

Let's go to Jack Cafferty for "The Cafferty File" -- Jack.

JACK CAFFERTY, CNN ANCHOR: Embattled South Carolina Governor Mark Sanford should be impeached for abusing state finances -- the charges come from a state senator who also happens to be a fellow Republican.

Senator David Thomas says Governor Sanford violated state regulations by billing South Carolina for business and first-class tickets on international flights during trade missions. South Carolina law requires officials to buy the cheapest seats possible. He is also accused of using state airplanes for personal and political travel, which he admits doing.

Governor Sanford acknowledges that he did wrong and that there are consequences for that. But the weak-kneed rationale for his malfeasance in office is something along the lines of other people have done this and even done it more often than I have. It's the same kind of logic used by people doing long stretches in prison for robbing banks. Other people did that, too.

Of course, Sanford has been under fire since he mysteriously disappeared in late June. At first, his office said he was hiking the Appalachian Trail. It was nude hiker week that weekend. I don't know if anybody in his office knew that at the time. I would guess not.

A week later, though, in his rambling news conference, the governor admitted he wasn't on the Appalachian Trail. He was in Argentina with a woman he had been having an extramarital affair with. At the time, people called on him to resign, but Sanford said he planned to continue as governor and would try to fix his relationship with his wife and four sons, whom he left on Father's Day to be in Argentina with this other chick.

His wife, Jenny, has since moved out of the governor's mansion in Columbia, South Carolina, and taken the four kids with her. But Governor Sanford says they are not going to get a divorce.

The question is this: Is Mark Sanford no longer fit to serve as governor of South Carolina?

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

BLITZER: That's going to get a lot of comments, Jack, I suspect.

(CROSSTALK)

BLITZER: Thank you.

To lower your medical bills, do you need to get God on your side? One group has a unique health care plan and one member says if more of you could practice God-fearing habits, there might not be a health care crisis in the country at all.

Are you living next door to gun-toting American extremists bent on terrorizing other Americans? We're hearing anti-government militia are now making a comeback.

And Hillary Clinton invokes George and Jeb Bush, Florida, and the contested Florida election while still in Africa. What she said is now raising some eyebrows. We have the videotape.

(COMMERCIAL BREAK)

BLITZER: All sorts of ideas are being kicked around to make sure more Americans have health care coverage. Why not try a little divine inspiration?

You could say that is what is going on in Philadelphia right now, where Christians are helping each other pay their doctor bills.

Our Kate Bolduan is here with a story you will see only here on CNN.

Kate, what is going on?

KATE BOLDUAN, CNN CORRESPONDENT: Well, Wolf, you could call it a health care plan based on a little bit of faith. It's a unique variation of a cooperative. And with co-ops making health care headlines lately, we just had to learn more.

(BEGIN VIDEOTAPE)

BOLDUAN: As the health care debate rages on in Washington, we decided to get outside the beltway. We are heading to Philadelphia to take a look at one alternative people are turning to.

(voice-over): It's called bill sharing. In this case, a large group of Christians pool their money to cover each other's medical costs. It is not conventional insurance, and it is not regulated. Christian activist Shane Claiborne is a member of one, Ohio-based Christian Healthcare Ministries.

SHANE CLAIBORNE, CHRISTIAN CO-OP MEMBER: One of the things I like about it, it is relational and I can see exactly where my money is going. And I also wanted my money not to go to line some executive's pockets or buy some yachts and Bentleys, but actually go directly to meet the medical needs of folks that are really carrying those burdens.

BOLDUAN: Last time we saw Claiborne, he was touring the country promoting his book "Jesus For President." He moved into this rough Philadelphia neighborhood to help clean it up, like this former drug den he took us to.

CLAIBORNE: We talk a lot about practicing resurrection. So, for us, this is a part of it. We bring abandoned spaces to life and try to make ugly things beautiful.

BOLDUAN: It is rough work. Claiborne was jumped a few years ago, landed in the hospital with a concussion and broken jaw. That's when his health care stepped in.

CLAIBORNE: So, you get this bill for $10,000 or $12,000 and then we ended up paying $6,000 of it. And because I had thousands and thousands of people carrying that bill with me, I was able to just write -- we just wrote a check for it.

BOLDUAN: The ministry negotiated directly with his doctors to lower the bill.

Executive director Howard Russell says the core of their success is the 20,000 members who have met conditions that include not smoking, being a Christian, and living by the Bible.

HOWARD RUSSELL, CEO, CHRISTIAN HEALTHCARE MINISTRIES: If everybody in America had the provisions that our members have, there wouldn't be a health care crisis.

BOLDUAN (on camera): It's like a health care cooperative, a community-based nonprofit organization owned by its members, a group that uses its strength in numbers to negotiate competitive rates with health care providers. And that's an idea gaining traction on Capitol Hill.

(voice-over): Robert Burns, a professor of health care management at the University of Pennsylvania, says the key to co-ops is size -- 20,000 to 50,000 enrollees minimum needed.

ROBERT BURNS, PROFESSOR, UNIVERSITY OF PENNSYLVANIA: If they are not big enough, then they won't be able to do either of those two things, hold down their administrative costs internally or negotiate good rates with the providers externally.

BOLDUAN: And, even then, it may not be enough.

(on camera): Do you see health care co-ops as the silver bullet to this debate?

BURNS: No, as I told my class last night, it's part of the silver buckshot.

BOLDUAN: So, one of many that needs to be done for reform?

BURNS: One of many. That's right.

BOLDUAN (voice-over): Claiborne agrees. His co-op may not suit everyone's health care needs, but he is hoping it at least forces Americans to think outside the box.

CLAIBORNE: I am not here to endorse one particular project of this, but actually the vision of caring for each other in a way that we're able to provide health care for one another.

(END VIDEOTAPE)

BLITZER: So, Kate, if these health care cooperatives are already up and running, what would new legislation that's out there in Congress actually accomplish?

BOLDUAN: Well, one thing they're talking about, they are talking about taking it to a national level on a national scale or to regional and state level or a combination of both.

Senator Kent Conrad, he has become a big proponent, a big supporter of this. He sees the cooperatives as the way to bridge the gap, appeal to Democrats and Republicans, to really get bipartisan reform done.

BLITZER: He may be right. BOLDUAN: We will see.

BLITZER: Thanks very much. Good report, Kate Bolduan.

A new warning about anti-government militia groups right here in the United States. They are reportedly regrouping right now and could actually balloon in size. We are going to take a look at who belongs to them and if they pose a security threat.

And you may have seen video of this woman being removed from a town hall meeting yesterday. Well, today, we have video from another angle that tells a very different story.

A huge asteroid hitting the Earth, it's possible. But NASA says it can't monitor many of them and needs more money. We will tell you what's going on right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

(NEWS BREAK)

BLITZER: It's being called the most dangerous domestic terror threat in the United States right now. Right-wing militias are making a comeback. We are taking an in-depth look at this angry new call to arms.

And she's secretary of state right now, so should Hillary Clinton stop taking partisan shots at George W. Bush, especially when she is overseas?

And you may have seen this video of a woman being removed from a health care forum yesterday in Missouri. We now have a different camera angle. And it tells a very different story of what actually happened. Our Internet reporter, Abbi Tatton, has the videotape.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: Everybody, sit down.

(END VIDEO CLIP)

(COMMERCIAL BREAK)

BLITZER: We have all seen images like these, terrorists training in distant lands. This kind of thing, though, is also going on right here at home. They are not branches of al Qaeda. They are right-wing extremists with lots of guns and an axe to grind against the U.S. government.

We have an in-depth report right now on the growing threat from these militias.

CNN's Brian Todd is here with more on what he's learning.

What are you learning, Brian? BRIAN TODD, CNN CORRESPONDENT: Well, Wolf, you will remember, in the 1990s, these groups were blamed for espousing the ideology put into practice by that Oklahoma City bomber Timothy McVeigh. Now a new report claims anti-government militias could be making a significant comeback.

(BEGIN VIDEOTAPE)

TODD: A posting on YouTube attributed to the Ohio militia.

UNIDENTIFIED MALE: Listen, people, things are bad. Things are real bad. And it's going to get a lot worse. So, basically, you people need to wake up. Start buying some of these, see?

TODD: The video is an example of how militias are making a comeback according to a new report from the Southern Poverty Law Center.

MARK POTOK, SOUTHERN POVERTY LAW CENTER: We're at a very worrying moment, in my view. We're seeing a kind of perfect storm of factors that favors the continued growth of this movement. We are talking about non-white immigration, a black president, an economy that is in very dire straits.

TODD: A Homeland Security assessment in April said recent arrests indicate the emergence of small well-armed extremist groups in some rural areas. How dangerous are they?

JANET NAPOLITANO, U.S. HOMELAND SECURITY SECRETARY: It's a number of groups, almost far too numerous to mention, regrettably so. But some of them, indeed, want to do what happened in Oklahoma City, that is, commit violent acts within the homeland.

TODD: The government's intelligence assessment said, lone wolves and small terrorist cells embracing violent right-wing extremist ideology are the most dangerous domestic terrorism threat in the United States. A leader of the Michigan militia told us members of established militia like his, which do training on firearms and first aid, shouldn't be lumped in with violent extremists who talk about mounting attacks.

UNIDENTIFIED MALE: It's not something that we want to tolerate. We are not going to let any innocent Americans get hurt.

TODD: He described their ideology as pro-freedom and pro- Constitution, not anti-government.

MARK POTOK, SOUTHERN POVERTY LAW CENTER: I don't mean to suggest that all of these people out there with these kinds of ideas are killers. I think that's absolutely and clearly not true.

But does this movement produce people who engage in criminal actions and sometimes really terrifying ones?

I think that's unquestionable. TODD: Several high profile criminal suspects have been linked to racist or right-wing ideology recently -- the alleged shooter of three Pittsburgh police officers killed in April; the man charged with killing a Kansas abortion doctor in May and the alleged gunman at the Holocaust Museum in Washington in June.

The election of the first African-American president is serving as an extremist recruiting tool, according to the Department of Homeland Security. Law enforcement sources tell CNN, while Barack Obama had a significant number of threats during his campaign, since his swearing-in, it's not been much different from previous presidents.

Still, a former Secret Service agent tells us...

WILLIAM PICKLE, FORMER SECRET SERVICE AGENT: I think the historical nature of this presidency is -- is certainly something the Secret Service and the whole country is aware of.

(END VIDEOTAPE)

TODD: Now, neither of these two reports mentioned left-wing extremists. But a January Homeland Security Department report focused on cyber attacks by left-wing groups. And law enforcement has charged environmental extremists who have committed arson attacks -- Wolf.

BLITZER: And I understand the Southern Poverty Law Center, also, in their new report, says something about gun sales in the United States.

TODD: This report says that they are up from last year. But gun rights advocates say what that reflects is a concern among law-abiding gun owners that this administration -- this Congress are going to tighten up gun laws. So they say that -- that part of the report may not put it all into context.

BLITZER: Brian Todd, thanks very much for that report.

The FBI says it's investigating death threats against a United States Congressman and Nazi graffiti found outside his Georgia office. Democratic Congressman David Scott was targeted after he got into a heated argument with a doctor during a forum that mentioned health care.

Congressman Scott tells CNN the threats and racial abuse he's been getting are appalling.

(BEGIN VIDEO CLIP)

(BEGIN VIDEO CLIP FROM "AMERICAN MORNING")

REP. DAVID SCOTT (D), GEORGIA: This symbol represents the most heinous period in world history, indicative of man's greatest inhumanity to man, where nearly six million Jewish people and others were murdered purposely by Adolph Hitler. So when you reach that point to go -- and this is how this individual wanted to express their concern about this health care debate -- this is very, very dangerous. And it's part of others -- that things we received in the mail, like, for example, this, which depicts President Obama as the clown with the swastika on his forehead: "Death to Marxists, foreign and domestic," meaning some of the concerns that Bertha (ph) has had. And then it says to (EXPLETIVE LANGUAGE) David Scott, you were, you are and you shall forever be a (EXPLETIVE LANGUAGE). And the Ethiopian cannot make himself white. I mean, this is just outrageous.

(END VIDEO CLIP)

BLITZER: And another congressman said he said he's been getting threats because of the health care debate. Democrat Dennis Moore of Kansas is refusing to hold anymore town hall meetings on this issue for now.

We showed you video yesterday from a town hall meeting in Missouri where Senator Claire McCaskill was seen and a woman inside that room was escorted out. A video now posted on YouTube from a different angle tells a very different story.

Let's bring in our Internet reporter, Abbi Tatton -- Abbi, tell us what the video shows.

ABBI TATTON, CNN INTERNET REPORTER: Well, let's start with the video that we all saw yesterday. It seemed to show a woman being led out, clearly very agitated. She's yelling, being taken out by police. That's the video that we saw yesterday.

But now we've got another video that was shot from up there in the bleachers at exactly the same time. This was shot by Democratic strategist, Peter Glickert (ph), who says he was there to document the event, but he was there in an unpaid capacity. He just wanted to tape it.

The woman is right here at the bottom. Glickert (ph) and other people there say that she had entered with a sign. Now, signs were not allowed at this event. She had been asked to put it down and she had done so.

Now, I want to press play on this video. You'll see this woman walking toward her at the bottom. This is photojournalist Ali Gardner (ph). She wanted the woman's name to know what was on the sign for a story. Gardner says that the sign showed Rosa Parks' name and some images of the civil rights movement.

Now, look at that guy. That guy walks over, snatches the sign and the woman follows him. She appears to be trying to get that sign back. There's a scuffle and then the man is also led away, in the other direction, by police -- something that we just didn't see on the video yesterday.

If we can cue that up again and highlight what happened, you'll see that it seemed to be that the woman was reacting to the man who tried to come over and take her sign.

Wolf, Glickert says that he was uploading this video to YouTube because what we all saw on the news was one view and what his video showed with a very different view entirely.

BLITZER: There's a lot of cameras out there nowadays at these events, so you get different angles...

TATTON: Right.

BLITZER: ...and they tell different stories.

TATTON: And one thing we don't know is why that man was motivated to go and take the sign. But Gardner (ph) says that he was shouting, "No signs" at this point.

BLITZER: All right. Thanks very much, Abbi, for that.

Secretary of State Hilary Clinton finds her Africa tour overshadowed once again, this time by her remark today about George and Jeb Bush and the 2000 election. We'll have the tape for you. Stand by.

Plus, President Obama awarding the nation's highest civilian honor to 16 people. We meet some of the newest recipients of the Medal of Freedom.

(COMMERCIAL BREAK)

BLITZER: Lawmakers as punching bags -- why are they putting themselves in the line of fire over health care reform?

Let's talk about with this and more with David Frum, the former White House speechwriter under President Bush, now a fellow at the American Enterprise Institute; Nia-Malika Henderson, White House correspondent for Politico.com; and our own Joe Johns.

We'll get to you guys in a moment.

Let's go to Jessica Yellin first, our national political correspondent -- to Jessica for some background.

What's going on?

JESSICA YELLIN, CNN NATIONAL POLITICAL CORRESPONDENT: Wolf, move over, Jerry Springer. He's got nothing on some members of Congress at these town hall events. They're juggling rage, mistrust, warring parties -- all before a live audience.

Every day, we are watching politicians becoming punching bags. They're getting beaten up by voters, in many cases, who've already made up their minds. It can't be comfortable.

At one event, Senator Specter was told he'll have to answer to God over health care reform.

Today, a woman accused Maryland's Ben Cardin of betraying the faith and trust of the American people. Then she went on to say this.

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: This government is out of control. We are in debt up to our eyeballs and you all are doing nothing but putting more debt on us and our children and it's got to stop.

(END VIDEO CLIP)

YELLIN: When the senator tried to respond, the crowd did not want to hear it.

(BEGIN VIDEO CLIP)

SEN. BENJAMIN CARDIN (D), MARYLAND: I think that the Obama administration has already started to restore trust in health care by the...

(BOOS)

(END VIDEO CLIP)

YELLIN: Ouch. Well, put it in some context. They aren't all like this. There are also some straightforward questions about health care reform.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: What are you specifically going to do to ensure that the private option is there and viable?

(END VIDEO CLIP)

YELLIN: But, again, we've all heard the raucous questions a whole lot more. Now, the lawmakers say they're holding these events because this is part of democracy. But audience members still tend to leave angry, convinced that their voices have not been heard. And meantime, politicians are getting pummeled.

So the question is are these shout fests worth it?

Should politicians keep putting themselves in the line of fire -- Wolf?

BLITZER: Good question, Jessica.

David, what do you think?

DAVID FRUM, FORMER BUSH SPEECHWRITER: Well, they collect injure pay. Yes, they have to put themselves in the line of fire. They have to do this. And it's part -- there's a learning process. And, in a way, the more -- when you encounter something unfair, people see it. The audience sees it -- the TV watching audience sees it. And maybe they learn a little bit about what is true and what is not true.

BLITZER: Are we learning anything in the process or is there just a lot of -- a lot of noise out there?

NIA-MALIKA HENDERSON, WHITE HOUSE CORRESPONDENT, POLITICO: Well, one of the things that we're learning is that people are very angry. And it's hard to know if, you know, they're angry about health care or they're angry with Obama and uncomfortable with him, because one of the things you're seeing is they're commenting on a lot of things. They're commenting on immigration. They're commenting on the Iraq War. They're obviously, you know, concerned about health care, too. But in some ways, these town halls seem to be, you know, a vehicle for express -- for folks just expressing all that anger they have about what's going on.

BLITZER: And I suspect -- Joe, you've covered Congress, like I have, for a long time -- these members will come back to Washington influenced by what they're hearing at these meetings.

JOE JOHNS, CNN CORRESPONDENT: Absolutely. And one of the questions that follows along with that is are the Democrats getting out of it what they thought they were getting out of it?

On one side, there are some Democrats who are saying it shows extremes and to the extent it's a proxy fight over other issues, the direction the president is leading the country, that's one thing.

But one Democratic strategist I talked to today said a lot of Democrats look like they're out of control, they don't have control of the message, they're reacting instead of sort of asserting what they think needs to be done about health care. They're back on their heels -- all, they say, because Democrats simply didn't have a unified message going into August.

So it's a future problem for them, perhaps.

BLITZER: It seems to me -- and correct me if -- if I'm wrong -- is that at these events, at least the ones that I've seen so far, the Republicans and the conservatives are much more vocal than the Democrats and the liberals.

FRUM: The Republicans and the conservatives have something they're against. They have a target. They may not always be against it for knowledgeable reasons, but they know what they're against.

BLITZER: So why can't the White House and the Democratic establishment...

(CROSSTALK)

BLITZER: ...get their act together, as they did during the campaign, and get their forces out there?

HENDERSON: Well, that's clearly what the -- Obama is trying to do. I mean, we saw him in New Hampshire yesterday try to give some talking points, try to put the message out there that this is really about, you know, safety and security for people who are already insured. And he'll do that again on Friday. And they even -- I mean, before they left, the White House gave a lot of senators pep talks and kind of gave them talking points. But it's clear that it's not really getting through so well.

BLITZER: All right, guys. Stand by for a moment. We've got more to discuss, including echoes from the 2000 election campaign reverberating in Africa today, where a remark by the secretary of State, Hilary Clinton, is overshadowing her diplomatic work once again. Details of what she said today. We have the videotape. Stand by.

Plus, an Oscar-winning actor, a civil rights icon, an ailing senator -- just a few of the people receiving the Medal of Freedom from President Obama at the White House.

We're going to take you there.

(COMMERCIAL BREAK)

BLITZER: Secretary of State Hilary Clinton is still in Africa, but she's raising some eyebrows by a remark she made today about the 2000 election here in the United States -- Jessica, what happened?

YELLIN: Well, Wolf, we've had some secretaries of States who are just about as famous for their own celebrity as for their jobs -- General Colin Powell, Condoleezza Rice, now Secretary Clinton.

But when you hold that job, how much of your own personal views is it appropriate to share?

You'll remember, Wolf, when Secretary Rice was in the job, you asked her whether she was going to vote for Obama and McCain and she dodged.

(BEGIN VIDEO CLIP FROM JUNE 21, 2008)

BLITZER: Have you decided who to vote for?

CONDOLEEZZA RICE, FORMER SECRETARY OF STATE: Wolf, yes.

BLITZER: Do you want to tell us?

RICE: No.

BLITZER: OK. You don't have to.

RICE: Thank you.

(END VIDEO CLIP)

YELLIN: Well, Secretary of State Clinton is letting some of her views show. Speaking to a town hall in Nigeria, she was asked about good government and corruption. And she was comparing Nigeria's government to the U.S. when she said this.

(BEGIN VIDEO CLIP) HILLARY RODHAM CLINTON, U.S. SECRETARY OF STATE: Now, our democracy is still evolving. You know, we had all kinds of problems in some of our past elections, as you might remember. In 2000, our presidential election came down to one state where the brother of the man running for president was the governor of the state. So we have our problems, too.

(END VIDEO CLIP)

YELLIN: Well, it's no secret that Clinton is a Democrat. But the question today is, should opinions about the nation's domestic politics be fair game or off limits for the nation's top diplomats -- Wolf?

BLITZER: A sensitive subject, David, especially a comment like that made overseas.

FRUM: They have to upgrade the quality of the mattress on the secretary's plane. I don't think she's getting enough rest. I mean, of all things for Hillary Clinton to say, to say, you know, having a powerful relative with a presidential position should not be something that is allowed to help you in your own personal political career, I think it's an unpromising line of attack for her.

BLITZER: She's going to be criticized by a lot -- well, a lot of people don't like her to begin with, in terms of her political critics. But this is going to raise some eyebrows.

HENDERSON: Yes. I mean, and sure. I mean one of the questions that Hilary Clinton got when she was running was essentially will the real Hilary Clinton stand up?

And it looks like she's finally doing that. I mean she had these comments before, the "I am the secretary of State" comment and with this, wading back into this 2000 campaign, it does seem like she's herself in a lot of ways.

She's being the real kind of off-the-cuff, unscripted Hilary Clinton. And I think for some people, that's really refreshing. But as you said, it certainly can give her opponents some ammunition.

BLITZER: Because, you know, the -- the downside of this for her diplomacy is she really is doing important diplomatic work in Africa right now. But a comment like that -- 19 seconds -- can sort of overshadow everything.

JOHNS: Well, it looked to me like she didn't finish the sentence. I mean the end of that sentence that -- that she stated was that: "But we in the United States did no go out into the streets and participate in violence with machetes or machine guns or what have you because we didn't like the way the election turned out."

I mean if you look at it from a political science standpoint, the comparison is apt, even though she was not very articulate with it. And that is that politics in Nigeria is sometimes and has been brutal. Here in the United States, we can have a transition of power where one person follows another person, a lot of people may disagree with the outcome, but there's no violence.

(CROSSTALK)

JOHNS: You sort of understand what she was trying to say. Maybe she didn't say it too well.

BLITZER: She didn't say it as -- as well as you just said it, obviously...

(CROSSTALK)

BLITZER: But then again, you haven't been traveling for 10 days and getting very limited sleep.

But do you want to elaborate?

FRUM: Well, I think your -- the initial question, what is the role of talking about domestic politics?

I mean it seems to me you shouldn't be doing that. And she needs to remember, you're representing everybody. It was a close election. There are a lot of people who thought the Supreme Court came up with the right answer.

And, by the way, there was no possibility that anybody other than George Bush was ever going to win that election anyway because it would have gone to the House of Representatives. So quit picking the scab.

BLITZER: Because the point, I guess, the implication of what she's saying is that the president's brother, Jeb Bush, you know, may have been involved in some, you know, hanky panky to get his brother elected president.

HENDERSON: Yes, I mean that certainly seems like what she was kind of tiptoeing around. And I mean, as you said, I mean she's in a difficult position to be saying that, I mean, given her -- you know, she's essentially from a political dynasty, as well.

But, I mean, again, I think she, as secretary of State, is probably allowed to say things that the president can't. And she is, you know, very much kind of in her element, it seems to me, in this job.

BLITZER: All right. We'll leave it on that note. Guys, thanks very much.

Let's check in with Lou to see what's coming up at the top of the hour -- Lou?

LOU DOBBS, CNN ANCHOR: Wolf, thank you very much.

We'll have complete coverage of the Democratic Party's struggle to solve the president's health care plan and we'll have the latest on the president's continuing plunge in the poll ratings.

Extremists fringe groups are now trying to dominate the health care debate. We'll tell you who's behind each of those fringe groups.

And rising concern that the Obama administration is trying to push through a "big government agenda" funded by, of course, American taxpayers. It's an agenda that some are saying could change this country forever. That is the subject of our Face-Off debate here tonight.

And new evidence that the worst recession since World War II is ending. Even the Federal Reserve acknowledging our economy is stabilizing. We'll have the very latest -- a special report.

Join us for all of that, all the day's news and much more at the top of the hour -- Wolf, back to you.

BLITZER: All right. Thanks very much, Lou.

See you in a few moments.

Let's check in with Jack for "The Cafferty File" -- Jack.

CAFFERTY: The question this hour: Is Mark Sanford no longer fit to serve as the governor of South Carolina?

John in Indiana writes: "I don't care about his sex life at all, not one bit. But if he wasted or misused a single nickel of taxpayer money, he's got to go."

Mary in Florida: "Sure he's fit to serve as governor. If you removed from office all the men who have been unfaithful, there would only be women serving in high office."

Kate writes: "Let's face it, Republicans are searching for anything they can find to get rid of this guy before another election cycle passes and this loony tune is still in the news."

Joe in Missouri says: "Does hypocrisy disqualify you? My complaint with Sanford is that he's a hypocrite. He's like Newt Gingrich, who judged Bill Clinton while he was doing the same thing or worse on the sly. Give me a straight out sinner any day."

Carl in San Diego says: "I could care less about his affair. However, he either should have been impeached or resigned, since he left the state, which he swore to govern and serve, without any notice of how he could be contacted. He let the people of his state down. If you or I just disappear for a time from our job without anyone knowing how to contact us, we wouldn't have a job."

Ed in Cincinnati says: "It's not a question of being fit, rather a question of being effective. Given his baggage, he is and will continue to be ineffective. It's time for him to go."

And Robert in Florida writes: "Mrs. Sanford should divorce him. South Carolina should impeach him and throw him out. And he should fly to his soul mate in Rio, where hopefully we would never have to hear of or about him again."

If you didn't see your e-mail here, you can go to my blog at CNN.com/caffertyfile, where we post hundreds of these every hour. It's fascinating reading -- Wolf.

BLITZER: It is fascinating.

We'll do more of it tomorrow.

Jack, thank you.

CAFFERTY: OK. See you.

BLITZER: He inspired an Oscar-winning performance from the actor Sean Penn. Now the slain gay rights activist, Harvey Milk, is honored with his own award. You're going to hear President Obama's tribute. That's coming up.

(COMMERCIAL BREAK)

BLITZER: For American civilians, there is no higher honor from the government than the Presidential Medal of Freedom. Today, President Obama handed out 16. Recipients included a slain gay rights pioneer who was the first openly gay person elected in a major U.S. city.

(BEGIN VIDEO CLIP)

OBAMA: His name was Harvey Milk and he was here to recruit us -- all of us -- to join a movement and change a nation. For much of his early life, he had silenced himself. In the prime of his life, he was silenced by the act of another. But in the brief time in which he spoke and ran and led, his voice stirred the aspirations of millions of people.

(END VIDEO CLIP)

BLITZER: Another recipient was the first woman ever to sit on the United States Supreme Court.

(BEGIN VIDEO CLIP)

OBAMA: When a young Sandra Day graduated from Stanford Law School at the top of her class, in two years instead of the usual three, she was offered just one job in the private sector. Her prospective employer asked her how well she typed and told her there might be work for her as a legal secretary.

Now, I cannot know how she would have fared as a legal secretary, but she made a mighty fine justice of the United States Supreme Court.

(END VIDEO CLIP)

BLITZER: Others awarded the Presidential Medal of Freedom include Senator Ted Kennedy, who did not attend the ceremony due to -- due to his ongoing battle with cancer; the internationally recognized physicist, Steven Hawking; the civil rights icon, the Reverend Joseph Lowery; the former vice presidential candidate, Jack Kemp, who was honored posthumously; and the first African-American ever to win a best actor Academy Award -- we're talking about Sydney Poitier.

We want to congratulate all the winners -- all the recipients of the nation's highest honor, the Presidential Medal of Freedom.

And we want you to also check out our political podcast. To get the best political team to go, you can subscribe at CNN.com/situationroom.

I'm Wolf Blitzer in THE SITUATION ROOM.

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