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Fort Hood Massacre Shooter Talks; New Pap Smear Guidelines Out, Stir Controversy; Economic Suffering Deepens; Feeling Heat on Health Care; Who's Protecting Consumers?

Aired November 20, 2009 - 16:00   ET

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


WOLF BLITZER, CNN ANCHOR: Happening now: The Fort Hood massacre suspect is talking. Wait until you hear what Major Nidal Malik Hasan knows, according to his attorney. We have new information just coming into THE SITUATION ROOM.

First mammograms, now Pap smear, some women are told essentially to rethink a lot of the advice they have been receiving over the years about another cancer screening. Will new guidelines on Pap tests cause uproar, like new mammogram guidelines did? I will speak with a Columbia University public health professor.

And dramatic developments in a case threatening to rip apart a Missouri town -- the woman takes the stand in the case pitting blacks against whites with Wal-Mart right in the middle.

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

This just coming into THE SITUATION ROOM: Ever since 13 people were slaughtered in cold blood at Fort Hood in Texas, ever since authorities nabbed a man and charged him with multiple counts of premeditated murder, a lot of people have wanted to know this. Does this suspect fully understand the claims against him?

Well, now just coming into CNN, we're told just what Major Nidal Malik Hasan understands as he lies in a hospital bed.

Let's bring in Brian Todd. He's been investigating.

What are you finding out, Brian?

BRIAN TODD, CNN CORRESPONDENT: New information just in, Wolf, on the alleged shooter's condition. This is from his attorney, John Galligan, who tells CNN that Hasan has been conversing with him from his bed in the intensive care unit at the Brooke Army Medical Center near San Antonio.

The attorney, Mr. Galligan, who did not want to be interviewed on tape, says his conversations with Hasan has been coherent, that Hasan who comprehends who Galligan is and what the next steps are in the legal process. Galligan says he last met with Hasan on Thursday, says, after about one hour, it was clear that Hasan was fatigued and could not continue. When I asked Galligan about Hasan's paralysis, he confirmed he's paralyzed from the waist down, said he tapped him on the thigh, and -- quote -- "There's no feeling there."

Galligan says Hasan has several guards around him.

CNN is also getting new details of Hasan's alleged shooting rampage. Texas Congressman John Carter, whose district includes Fort Hood, has just met with more victims and with commanders at the base. Carter says victims are telling him, when the shooting first started, many of them thought it was some kind of paintball drill. They told Carter that Hasan had a laser sight on a gun and was shooting everything and everyone he could get a laser on. And Carter says victims are telling him about who they think Hasan wanted to hit.

(BEGIN VIDEO CLIP)

REP. JOHN CARTER (R), TEXAS: Everybody is convinced he was starting soldiers, and not targeting civilians, because some of the civilians said he looked them in the eye, shook his head, and passed over them.

And, so, they really think he was targeting soldiers, and not targeting civilians.

(END VIDEO CLIP)

TODD: Carter also told me a short time ago that one soldier who was a victim told him that he, that particular soldier, was shot three times until he fell, and then Hasan shot him again three more times. That soldier survived the attack, according to Representative Carter.

Now, we have to stress these are secondhand accounts from the congressman from victims who told him these things. And eyewitness statements can often be inconsistent.

When I asked Hasan's attorney, John Galligan, about Carter's accounts from these victims, Galligan says he's -- quote -- "saddened" by the congressman's remarks, calls them inflammatory, premature, and prejudicial. He says he takes issue with the content and character of the congressman's accounts -- Wolf.

BLITZER: Has Hasan's attorney seen the -- the e-mails that he exchanged with this radical Muslim cleric in Yemen?

TODD: I asked him about that. Galligan says he has not seen those e-mails. He has not seen any classified documents yet. He's seen some of Hasan's personnel file, but he says the only things he's really seen are some very basic things, not even some of the things that have been reported in the media about how Hasan's record at Walter Reed and at (INAUDIBLE) and other places.

Galligan says he's asked for his own security clearance to be reinstated, so that he can view some of this classified material. He says the Army has not responded to that.

BLITZER: Just to recap, you say that he's conversant, he's aware of what's going on.

TODD: That's right.

BLITZER: What about his physical condition beyond that? Did John Galligan give you an update on that?

TODD: It was interesting.

We tried to get some details. He's very circumspect on some of the details of Hasan's condition. At one point, he described his condition as grave. And I said, now, wait a minute. That, in many medical circles, means that it's very close to death. He said, no, he's not close to death.

So, clearly, this is not a medical doctor talking. But he's in clearly some serious condition. He is paralyzed from the waist down. Again, he said he tapped him on the thigh. He can't feeling anything there. So -- but, again, conversant. He seems to understand what's going on and the next steps in the legal process.

BLITZER: Brian Todd is doing some good reporting for us, as usual.

Thanks, Brian, very much.

The White House has been working on a new Afghan strategy now for months, and we still don't know when or if U.S. troops will join the battle, at least additional U.S. troops, already 68,000 in place. Another 30,000 or 40,000 potentially could be on the way.

The defense secretary, Robert Gates, today apparently already considering, though, an exit strategy -- listen to this.

(BEGIN VIDEO CLIP)

ROBERT GATES, U.S. SECRETARY OF DEFENSE: We are not going to do what we did in 1989, and turn our backs on Afghanistan. But what we would hope is that, within a reasonable period of time, that we could begin transferring responsibility for security over to the Afghans, as they are capable of taking responsibility for it, and -- and begin drawing down our forces.

(END VIDEO CLIP)

BLITZER: Let's talk about what's going on with our senior political analyst, Gloria Borger.

The president is back from his four-nation trip to Asia.

BORGER: Yes.

BLITZER: He's got a lot on his plate right now. When are we hearing he's going to announce his Afghan strategy?

BORGER: I think we're probably see it shortly after Thanksgiving, probably within a week or so after. And what you heard from Secretary Gates is what I'm hearing, which is that, when the president does announce his decision, he's also going to give us some sense of where the off-ramps are in all of this, in other words, no open-ended commitment. He clearly doesn't want to get bogged down in Afghanistan. And he is going to tell that to the American public.

BLITZER: Are we beginning to see the outlines, though, of an Obama strategy?

BORGER: Well, we are. In trying to piece this together, it's hard to come up with sort of specific numbers. But what we are seeing is that this is more likely to be a process, Wolf, than the president coming out and saying, we're going to do X-number of troops.

But what he's going to do is set benchmarks or targets for Afghanistan and Pakistan to meet. In other words, in Afghanistan, you have got to -- you have got to be more independent, set up your troops, get rid of corruption, Pakistan, start targeting al Qaeda, start targeting militants.

You know, the big question, though, Wolf, is, we don't know, if they don't meet those benchmarks, what do we do then? What's our stick, you know, because we're there for us; we're not there for them...

(CROSSTALK)

BLITZER: It also -- it also looks like the administration is beginning to rethink the entire strategy in dealing with the recently reelected Hamid Karzai.

BORGER: Yes. I spoke with one administration source who said to me, let's just call it a recalibration, because, obviously, this is an administration that's been very disappointed in Karzai. And -- but they understand, of course, that, right now, they have got to work with him. He is our guy, whether we like him or not.

As one person said, we're in Afghanistan because of our interests, not his, and we have to learn to work with him. So, they will.

BLITZER: Lots -- lots of questions that have to be resolved.

BORGER: Absolutely.

BLITZER: You say after Thanksgiving, the -- presumably shortly thereafter...

BORGER: Yes. That's what I believe.

BLITZER: ... we will get word how many troops will be heading off to after. Thanks very much.

(CROSSTALK)

BLITZER: Let's check in with Jack Cafferty. He has got "The Cafferty File."

JACK CAFFERTY, CNN ANCHOR: Talking about this Thanksgiving?

BLITZER: Yes, this Thanksgiving.

CAFFERTY: Just checking.

Something called a Botax might help pay for health care reform. The name derives from a tax on Botox, which, in the case of some of those Hollywood types, could raise millions. Senate Democrats are proposing a 5 percent excise tax on elective cosmetic procedures. This would include Botox injections, breast implants, tummy tucks, face-lifts, liposuction, teeth-whitening, eyelid repairs, et cetera. The tax would bring in an estimated $6 billion over 10 years. It would not apply to cosmetic surgery needed to fix a deformity or injury.

Drugmakers and plastic surgeons, as you might expect, think it's a terrible idea. The company that makes Botox calls it an easy target, says the tax is unnecessarily punitive. The American Society of Plastic Surgeons says it will hurt countless American women of every income level, that it is not just -- quote -- "a tax on wealthy suburban Republican women."

They claim the tax would come at a particularly difficult economic time, when women are trying to spruce up their looks as they search for jobs.

I would offer that, if you're out of work, you probably wouldn't be getting Botox injections, but what do I know?

It could have been worse. Lobbyists -- true -- lobbyists apparently succeed in persuading lawmakers to reduce the tax from 10 percent, which would have brought in $11 billion over 10 years. Over the summer, a lot of Democrats -- a lot of people, rather, thought the Democrats couldn't possibly be serious about taxing cosmetic surgery, but, oh, they were so wrong.

Harry Reid and company brought it back because -- quote -- "They needed money to make the bill work" -- unquote.

Here's the question, should the government tax cosmetic procedures like Botox, tummy tucks and liposuction to help pay for health care reform? Go to CNN.com/caffertyfile and post a comment on my blog.

You know, I was just thinking, out of that whole list of stuff I read, with like one exception, I could use all those things.

BLITZER: Tummy tucks? You don't need one.

(LAUGHTER)

CAFFERTY: Well, maybe not a tummy tuck. Two things.

BLITZER: Liposuction, but not a tummy tuck. (LAUGHTER)

CAFFERTY: Thanks a lot.

(LAUGHTER)

BLITZER: Jack, here's a question, serious question.

CAFFERTY: What's that?

BLITZER: Because you know it's going to come up.

The president has repeatedly promised he's not going to raise taxes on people earning under $250,000 a year. But, as you know, a lot of people who earn under $250,000 a year get some of that cosmetic surgery. So, in effect, he's going to be raising taxes on them, right?

CAFFERTY: Well, yes. And it's not just on people who get cosmetic surgery.

We are so far in the toilet when it comes to the national debt and the deficits, that they are going to have to raise taxes on just almost everybody, is my guess. But, yes, I don't see any way in the world he can keep that pledge of not raising taxes on people who make less than $250,000 a year. It's not going to happen.

BLITZER: I'm -- I suspect you're right, Jack. Thanks very much.

CAFFERTY: Sure.

BLITZER: Unemployment rates grow worse in dozens of states, with no apparent end to the suffering. More Americans are blaming Democrats. And members of the Obama administration are right now being hammered. Stand by.

First, mammograms, now Pap smears -- there are new guidelines about Pap tests to screen for cervical cancer. We have details. I will speak with a Columbia University professor of public health.

And this is a TV newsroom -- take a look at this -- attacked by a mob of right-wing activists. They beat employees, smash furniture with baseball bats. Wait until you hear their explanation.

(COMMERCIAL BREAK)

BLITZER: Ten-point-two percent, that's the national average for unemployment, but a disturbing new report says things are getting a whole lot worse in individual states.

Could this suffering cause the Obama administration to suffer politically?

Let's bring in our White House correspondent, Suzanne Malveaux.

What do you see in there, Suzanne? SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Well, Wolf, these are very important numbers.

I want to point to the wall here, because this is the Labor Department survey that came out with this report today, taking a look at unemployment. Unemployment rose in 29 states. Plus, here in Washington, D.C., it fell for 13 states.

Wolf, this is a lot more than just numbers. It is about people and real lives. There are a lot more people that are suffering. And now they are starting to blame the president and his economic team.

(BEGIN VIDEOTAPE)

MALVEAUX (voice-over): Despite some economic indicators suggesting the economy has turned a corner, a new CNN/Opinion Research poll shows, a whopping 82 percent of the public believe economic conditions are poor. And the question of who to blame is taking front and center.

Just take a look at the grilling Treasury Secretary Timothy Geithner got from some Republican lawmakers.

UNIDENTIFIED FEMALE: The gentleman's time has expired.

Mr. Hinchey is recognized for five minutes.

REP. KEVIN BRADY (R), TEXAS: At some point, you have to take responsibility for your decisions.

(CROSSTALK)

TIMOTHY GEITHNER, U.S. TREASURY SECRETARY: I take responsibility for anything I am part of doing. I would be happy...

(CROSSTALK)

GEITHNER: What I can't take responsibility is, is for the legacy of crisis you have bequeathed the country.

BRADY: This is your...

MALVEAUX: Two years into the recession, the blame seems to be shifting. Americans are now less likely to point to the Republicans for the economic mess, and, instead, are angry at the Democrats.

The same CNN/Opinion Research poll shows 38 percent blame the GOP for the country's current economic problems. That's down 15 points from May, when 53 percent blamed them.

CNN deputy political director Paul Steinhauser says, that's bad for the Democrats and President Obama.

PAUL STEINHAUSER, CNN DEPUTY POLITICAL DIRECTOR: These numbers are troubling for the president. It's going to be harder and harder for this White House to blame the previous administration for the economic woes. This economy is turning into Barack Obama's economy. This recession is turning into Barack Obama's recession.

MALVEAUX: Americans are still very much divided over whether the president's economic policies are actually working. Thirty-six percent say they have improved economic conditions. Twenty-eight percent say they have made things worse. Thirty-five percent say what the White House has done has had no effect.

One of the reasons Americans are dissatisfied is their concern in the ballooning federal budget deficit. Two-thirds believe the government should be working harder to balance it.

UNIDENTIFIED MALE: Even though we're in a time of war, Americans think that the federal budget deficit needs to be brought down. The war is not an excuse.

(END VIDEOTAPE)

MALVEAUX: And another point, Wolf -- who gets the credit, who gets the blame on the state of economy, particularly jobs, could cost the Democratic Party as a whole.

I want you to once again take a look at these numbers in the wall here. It shows that three times the number of Democratic lawmakers facing midterm elections are in tough or close races, that is, three times the number as Republicans. So, who the voters actually see as part of the problem or the solution could make a very big difference next year -- Wolf.

BLITZER: And a quick political report, initial assessments. Still got a year to go, but we will be watching that closely, Suzanne. Thanks very much.

Let's bring in our chief business correspondent, Ali Velshi. He is joining us from Chicago.

Ali, right now, what's driving economic growth, and what's holding it back?

ALI VELSHI, CNN CHIEF BUSINESS CORRESPONDENT: All right. There are three things people depend on.

One of them is working. And that is markets. Stock markets are way up since the lows of March. That means that companies have a little bit more money. It means that people who invest are seeing retirement start to come a little closer, as opposed to go further away.

The -- the other thing that's kind of working is housing. It's stabilizing. It's not going down as fast. Low mortgage rates, a homebuyer's credit, and low home prices are helping to stabilize the housing market.

But, Wolf, the one that matters the most is the one that's not working. And, as Suzanne mentioned, it is unemployment. The bottom line is, you can live without buying or selling a house. You can live without your 401(k). You can't live without an income. And increasing numbers of Americans are having to be forced to live without an income. That's the number-one problem for this administration. If they start to see job losses stemming, unemployment going down, you will probably start to see a turnaround in those poll numbers.

BLITZER: What do we expect in terms of retail sales after Thanksgiving, before Christmas? This is supposed to be the busiest time of the year for a lot of these stores.

VELSHI: Yes.

It kicks off next week with Black Friday. You're already seeing stores being very heavily promotional. The bottom line is, you won't see the depth of sales that you saw last year. Remember, last year, this -- this was upon us more quickly than we had expected, so retailers couldn't manage their inventory. There weren't enough buyers, so they had to slash prices to get it out the door.

They are much, much more careful this year. Retailers are just not packing in as much inventory, which means not as much need to slash those prices, probably not a big rush to get out there, Black Friday, and be in those lines at 4:00 in the morning or 5:00 in the morning. If we come out with a retail season, a holiday season, that is any better than last year's, most retailers will consider that a victory.

BLITZER: Ali, thanks very much.

Ali is going to be coming back in the next hour. He's in Chicago. We are going to talk a little bit about Oprah as well.

A hodgepodge of agencies overseeing credit cards, mortgages and insurance, now there's a push to protect consumers in a new way. And big business is balking.

Also, you are going to find out why a museum in Italy plans to display two fingers and a tooth.

(COMMERCIAL BREAK)

BLITZER: Fredricka Whitfield is monitoring some other important stories incoming to THE SITUATION ROOM right now.

Fred, what's going on?

FREDRICKA WHITFIELD, CNN CORRESPONDENT: Hello to you, Wolf.

Hello, everyone.

Well, demonstrations are in play at a couple of University of California campuses, where students are protesting a 32 percent tuition hike. They occupied portions of U.C. buildings in Los Angeles, Berkeley, Davis, and Santa Cruz late yesterday. Sit-ins are still happening at Berkeley and Santa Cruz. University officials passed the tuition hike yesterday, saying it's needed because of the state's financial crisis.

Protesters say the hike will hurt students depending on state- funded education.

And officials in India say they suspect right-wing activists of attacking a Mumbai TV station today. The suspects say that it was an act of retaliation against the channel's bias against their leader. Offices at IBN-Lokmat was ransacked and employees were beaten. A deputy police commissioner says at least seven men have been arrested, and up to 20 more arrests are expected.

And officials in Saudi Arabia are taking extraordinary measures to prevent the spread of the H1N1 virus among millions of hajj pilgrims. Pilgrims landed at Jeddah International Airport must pass before thermal screening equipment, looking for anyone with a fever above 100.4.

No one is being barred from the hajj, but doctors say anyone showing signs of the disease are transported to a special hospital. Saudi authorities tell CNN that there have been 20 suspected H1N1 cases, of which only 12 were confirmed.

And two fingers and a tooth said to have come from Galileo will go on display next spring. The Museum of the History of Science in Florence, Italy, acquired the remains believed to belong to the astronomer from a collector. The Vatican branded Galileo a heretic for saying the Earth revolved around the sun. He died in 1642. Pope John Paul II rehabilitated him in the early 1990s -- Wolf.

BLITZER: It's a little gory, isn't it, two -- two fingers and a tooth?

WHITFIELD: It's kind of creepy to me.

(LAUGHTER)

BLITZER: Yes, it sounds sort of creepy. Who wants to see that?

WHITFIELD: But folks revel of finds like that.

BLITZER: Yes. Maybe it's a big deal for some.

WHITFIELD: yes.

BLITZER: All right. Thanks very much, Fred.

On the heels of new guidelines for mammograms, there's now some new advice about getting Pap smears. Should American women be worried that their health care is being rationed?

And we're digging deeper on the connection between a radical Islamic cleric and the alleged gunman in the Fort Hood massacre -- just ahead, the cleric's message raw and uncut.

(COMMERCIAL BREAK)

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

Happening now.: It's up to the jury in a case of a woman accused of losing it in a Missouri Wal-Mart. She took the stand today to tell her side of the story. Was she simply rude or driven to it by racial slurs?

Another member of Senator John McCain's family is making his mark on Twitter, this time behind the camera. CNN's Abbi Tatton will show us what Jack McCain is up to right now.

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

Days after new mammogram guidelines caused huge controversy, there are now new recommendations for Pap smears from the American College of obstetricians and Gynecologists. It recommends women have their first Pap test at age 21, then every other year until age 30, instead of every year. After age 30, the group advises women to get Pap tests every three years.

Let's talk a little bit more about all these guidelines causing huge controversy and confusion out there.

Joining us now is Professor Sheila Rothman, a public health professor at Columbia University in New York.

Professor Rothman, thanks very much for coming in.

DR. SHEILA ROTHMAN, PUBLIC HEALTH PROFESSOR, COLUMBIA UNIVERSITY: Thank you very much. Delighted to be here.

BLITZER: A lot of people are concerned. It looks like this is the start of rationing, sanctioned, in effect, by the government. Is it?

ROTHMAN: No.

I think it's sad that there's this confusion out there. The guidelines are quite separate. They have been put forth by two very conservative, very well-established agencies, the American Cancer Society, for the guidelines, are very strongly supporting it, the American College of Obstetricians and Gynecologists on the Pap test.

And they have been conflated with rationing, but they really have nothing to do with it. And I think it's important for the American people to begin to think about it and separate the two.

BLITZER: But what about the federal task force that came out with these new guidelines on mammograms? That wasn't the American Cancer Society or the college.

ROTHMAN: Well, but the week before, the American Cancer Society had spoken out about mammograms and kind of prepared us, I believe, for what was going to happen.

BLITZER: But the American Cancer Society, correct me if I'm wrong, didn't they walk away, distance themselves from these new guidelines on mammograms?

ROTHMAN: Yes and no. But I think what's really important here, Wolf, is for women to not begin to conflate these with rationing, and to begin to kind of understand what people are talking about.

I know all of us as women are very concerned about breast cancer, and obviously about cervical cancer, and mammograms and pap tests are very important to us. We go once a year, and I know myself and everyone else I know feels, like, a sigh of relief when we get the results back and we know that it hasn't happened to us.

BLITZER: Because to a lot of critics, it looks like they are more interested in saving money, which is not necessarily a bad thing if you can use that money for some more worthwhile uses, as opposed to saving lives.

ROTHMAN: I don't think that's really the issue here. There are new guidelines, and the guidelines are based on evidence-based medicine. A lot of the older stuff, as we're learning, was really much more anecdotal, much more of a narrative, and these new guidelines are trying to help set standards.

Now, they are just guidelines, and they really have nothing to do with an individual woman and her physician and what they decide. And individual decisions will be made, but these are just population guidelines, and they should be understood as that.

BLITZER: You say they are just guidelines, Professor, but the Department of Health and Human Services, on its Web site, calls these federal task force, the ones that came out with the controversial mammogram new guidelines, the gold standard, and a lot of insurance companies, there is fear out there, will start using these new standards, these new guidelines, and they won't reimburse people for getting mammograms, let's say, in their 40s.

ROTHMAN: That's hard to tell. I mean, what I can talk to you about is the fact that -- about the fear issue and about how women are perceiving this. And the fact -- I really am a historian of medicine, and talk to you about times when in the past, science has come out with new recommendations, and that it's taken people a long time to get used to them, even though they are based on science. Because some of the things we did before weren't based on science.

For instance, when Cox (ph) discovered the tubercle bacillus, people had always thought that tuberculosis ran in families. And it took the public a long time to understand that this was a little microbe and that they had to have different habits and think about things differently. We could talk about the same thing with hand- washing. And I think the issue here is really thinking about it, having doctors begin to educate people, having doctors understand this, and understand that this is based on evidence and not anecdote.

BLITZER: Still a lot of confusion out there when you get these new guidelines, especially when they go so against the grain of what we earlier had been told. And we're not going to resolve it right now, but thanks for coming in, Professor. Really appreciate it. ROTHMAN: You're welcome.

BLITZER: The Senate is nearing a critical test vote on health care reform. Some Democratic women in particular are feeling the pressure. Which way are they leaning right now?

And while Sarah Palin makes money, a lot of it off of her book tour, are Democrats making money off of her as well? Mary Matalin and Jamal Simmons, they're standing by for our "Strategy Session."

And your credit cards, your mortgage, your insurance. All sorts of different agencies are watching out for your money, and some lawmakers don't think they are doing a good enough job.

(COMMERCIAL BREAK)

BLITZER: Regarding health care reform, Democrats say Republicans are just saying things to scare you. Republicans say the real fear is the Democrats' plans.

Tomorrow night, both arguments are set to face off in the U.S. Senate. There will be a vote on whether or not to proceed with the actual debate on the Senate floor. Ultimately, to pass health care reform, Democrats will need all their members, including those who may be on the fence.

Our senior congressional correspondent, Dana Bash, has been watching what's going on up on Capitol Hill.

Dana, still a little bit of mystery, I take it, over whether or not Harry Reid, the majority leader, has those essential 60 votes.

DANA BASH, CNN SR. CONGRESSIONAL CORRESPONDENT: That's right. One Democratic senator, however, took the mystery away from how he is going to vote.

Ben Nelson of Nebraska announced today that, despite his deep concerns about his party's health care bill, he will in fact vote to begin debate, to bring the health care bill to the floor. He said, "If you don't like a bill, why block your own opportunity to amend it?" So, the president can cross Ben Nelson off his list of potential Democratic senators who can put the brakes on his top priority, but there are a couple of other senators who are still publicly coy.

(BEGIN VIDEOTAPE)

BASH (voice-over): Behind the scenes, it's a Democratic scramble to secure 60 votes needed to start the Senate health care debate.

SEN. DICK DURBIN (D), ILLINOIS: We're not assuming a thing. We're working hard to bring all Democrats together for the 60 votes necessary to proceed to this historic debate.

BASH: And all eyes are on one of the last Democratic holdouts, the senator inside this office, Blanche Lincoln of Arkansas.

UNIDENTIFIED MALE: Senator Blanche Lincoln's office.

BASH: Phones are ringing off the hook. Constituents trying to get through to influence her vote.

UNIDENTIFIED MALE: Yes, ma'am. I'm sorry about that.

UNIDENTIFIED FEMALE: OK. Can I let her know that.

UNIDENTIFIED MALE: Well, we're getting a lot of people calling.

BASH: Lincoln holds the power to stop President Obama's top priority in its tracks or let it proceed. She's got a tough re- election battle next year in a state Obama lost in 2008 by 20 points, and conservative voters now worry the health care bill spends too much and gives too much power to the government.

Democratic leaders are well aware of her political pickle, but try to pressure her with this argument...

DURBIN: I would say to Senator Lincoln that I believe most of the people in Arkansas will be relieved and happy to see health care reform. I think the failure to pass a bill is not good for America. It isn't good for any of us in Congress or those standing for re- election.

BASH: Another Democratic senator who hasn't formally announced her vote is Mary Landrieu of Louisiana. Aides released these photos to CNN showing her working with staff, going through the 2,000-plus page health care bill. One thing she will find is this -- a sweetener Democrat leaders added to help persuade Landrieu, $100 million in Medicaid assistance she's been trying to get for her home state of Louisiana, still struggling from Katrina.

(END VIDEOTAPE)

BASH: Now, Landrieu also says she still has deep concerns about a lot of what's in this bill, especially the cost and the fact that she opposes a government-run health care plan, which, again, is in this bill. But she seems to be leaning towards voting to start debate.

Now, when you talk to Democratic leadership sources, Wolf, perhaps because of that and because of other things they're hearing privately, they're cautious optimism behind the scenes has turned into really confidence that they will get these votes tomorrow night.

BLITZER: So, Dana, did I hear you right in saying there's $100 million earmarked especially for Louisiana in this legislation to make it more attractive for Mary Landrieu?

BASH: Mary Landrieu and other lawmakers from Louisiana. It's perhaps a little bit ironic, but remember, in the House there was one Republican -- one Republican in the House -- who voted for the Democrats' health care bill. He is a Republican who represents New Orleans. He had a personal conversation with the president, saying that he really hopes that they help Louisiana, so that is nice symmetry with what the Democratic senator from Louisiana also wants.

It's the delegation and the governor, the Republican governor, who have been pushing this for a long time. This is a good opportunity for the president to give it to them.

BLITZER: Yes, a $100 million sweetener. It sounds pretty good for Louisiana.

Thanks very much for that, Dana. We're going to watch this with you, obviously, all weekend.

Another focus in Congress this week, protecting consumers. Democrats say there are too many different agencies involved in protecting you and your money, and they're proposing one -- repeat, one -- watchdog agency with a lot more bite.

Our national political correspondent, Jessica Yellin, has been doing some excellent reporting on this for us.

I guess we could call it part of the "Broken Government" series we're looking at. What are you finding out today?

JESSICA YELLIN, CNN NATIONAL POLITICAL CORRESPONDENT: What I'm finding out is that right now, members of Congress are trying to fix the government, and there is a huge political fight under way. No, not on health care reform -- over a proposal to create a powerful new agency whose only mission would be to protect consumers.

(BEGIN VIDEOTAPE)

ETTA HUNTE, HOME WAS FORECLOSED: It's cooking.

YELLIN (voice-over): Etta Hunte is a victim of the kind of consumer abuses that helped take this nation to the brink of economic crisis.

HUNTE: I went on my own thought I was doing the right thing, and this is where it ended.

YELLIN: She lost the house she lived in for 17 years after she signed a new mortgage she didn't understand and couldn't afford. Her broker did not make it clear her payments would skyrocket.

HUNTE: Yes. I'm reading and signing this thing, signing my home away, and had no idea. And no one was informing me that it's an adjustable rate.

YELLIN: The problem? No single federal agency oversees all mortgages. Instead, five agencies have a hand in it. And during the subprime mortgage crisis, some companies worked the loopholes.

Elizabeth Warren is a watchdog for Congress.

ELIZABETH WARREN, CONGRESSIONAL OVERSIGHT PANEL CHAIRWOMAN: And there are gaps in between and overlaps in the regulatory structure. YELLIN: Mortgages are just one piece of a much bigger problem for consumers. Across the federal government, seven different agencies set rules for everything from loans to mortgages, credit cards and insurance products, so some companies play one regulator against another.

Now Democrats in Congress are pushing a major overhaul that would organize these powers into one new consumer protection agency.

SEN. CHRIS DODD (D-CT.), BANKING CHAIRMAN: Our plan will stop abusive practices by creating an independent consumer financial protect agency with one mission, and that is standing up for consumers.

YELLIN: Congressional Republicans oppose the Democrats' plan but do support new streamlined consumer protections.

REP. JEB HENSARLING (R), FINANCIAL SERVICES COMMITTEE: I believe in regulation that makes markets more competitive. I believe in regulation that respects the rights of consumers. I don't see this happening with this particular agency.

YELLIN: But business interests, they are ready for battle and have spent more than $334 million lobbying this year. They are led by the U.S. Chamber of Commerce.

TOM QUAADMAN, CHAMBER OF COMMERCE: You've just seen a multiplication of agencies. Big government isn't the answer.

YELLIN: He says the powerful new agency will hurt business innovation.

QUAADMAN: It creates a scheme where you have regulators who are really starting to decide who winners and losers are.

YELLIN: Etta Hunte just wants someone to speak for her.

HUNTE: I would like them to have somebody to keep tabs on these -- all of these mortgage companies.

(END VIDEOTAPE)

YELLIN: So, how would this new agency work? Well, they could mandate simpler contracts. They would have the power to sue companies for unfair practices. And they would say they would try to close gaps in regulations.

Now, the critics, they say this agency would limit our choices as consumers. For example, they insist if this kind of agency existed a decade ago, we wouldn't have ATMs or debit cards, for example.

So, very powerful interests, Wolf, lined up on both sides of this debate, and it's just beginning.

BLITZER: Yes. It must be huge for the companies if they're spending already more than $300 million just to lobby on it. YELLIN: Huge, huge dollars. It's business life and death for them.

BLITZER: All right. Thanks very much.

Jessica Yellin reporting for us.

It's a sure bet that Sarah Palin is certainly raking it in with her best-selling memoir, but could she be bringing in even a little bit more money for her political opponents?

Our "Strategy Session" is straight ahead.

And there's some frightening news out right now about the H1N1 virus. A mutated strain appears to drive infection deeper into the patient, and fears are growing that one of the key drugs in the fight against it is now losing its punch.

Stay with us. You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: Let's get to our "Strategy Session" right now.

Joining us, the Democratic strategist, Jamal Simmons. He's a principal with The Raven Group, which does have some health care interests as part of its clientele. And Republican strategist and CNN political contributor Mary Matalin.

I was pretty surprised -- and I'll start with you, Jamal. John Conyers, the chairman of the House Judiciary Committee, he really went after the president and Rahm Emanuel, the White House chief of staff.

Listen to what he told Bill Press on his radio show.

(BEGIN AUDIO CLIP)

REP. JOHN CONYERS (D), CHAIRMAN, JUDICIARY COMMITTEE: Holding hands out and beer on Friday nights in the White House, and bowing down to every nutty, right-wing proposal about health care, and saying on occasion that public options aren't all that important is doing a disservice to the Barack Obama that I first met, who was an ardent single-payer enthusiast himself.

(END AUDIO CLIP)

BLITZER: How worried, Jamal, should the president be that he could lose his very liberal base?

JAMAL SIMMONS, DEMOCRATIC STRATEGIST: You know, John Conyers is my hometown congressman from Detroit, and he has a very long record of speaking his mind and saying what he thinks.

Progressives are a little upset about some of the things that are coming through on the health care bill, but, you know, the Barack Obama from a few years ago, the difference between him and the Barack Obama of today is that this Barack Obama has got to get a health care bill passed, and failure is not an option, and he knows that. And so, they're going to do whatever it takes to get the bill through.

And I think at the end of the day, a lot of these progressives, although they may not be happy, they also know that failure is not an option. And as Bill Clinton used to say, we can't make the perfect the enemy of the good. We've got to get this bill through.

BLITZER: He's sort of -- I guess the accusation, Mary, has been sort of takes them for granted. He's really reaching out to the more moderate and conservative Democrats, whom he desperately needs to get this thing passed.

MARY MATALIN, REPUBLICAN STRATEGIST: Well, he does, and that would be a surprise to those moderate Blue Dogs who don't feel like they have gotten much cover.

What this does show is that the Democratic Party is far more cross-pressured than the much-ballyhooed coverage of the Republicans' so-called civil war. But as Jamal and I have been saying every time we're on, it's not a left or right issue. It's the people in the middle, it's the Independents, who have been from the beginning opposed and are increasingly intense about their opposition to this health care.

And that's where a lot of Democrats, particularly in the South -- you saw Jesse Jackson singling one out the other day. They are really cross-pressured and far more than the fringy (ph) left of whom Conyers has earned the right to be and to speak out for.

BLITZER: Mary, you're from Louisiana. You live in New Orleans right now. Mary Landrieu, the senator from Louisiana, she's apparently the last of the 60 needed to start the debate tomorrow night in the U.S. Senate. She's under a lot of pressure back home, she's up for re-election, as you know, next year.

What do you think she's going to do as far as allowing the debate at least to begin on the Senate floor?

MATALIN: I do not know, but I think this sweetener, as it's been called, has been completely miscast. I happen to know that Governor Jindal, everybody is for this, because it represents an anomaly in the way that the Medicaid dollars are calculated, an anomaly that arose from Katrina.

This is not new money, this is appropriated money. It's a glitch in the system, it's not a sweetener for Mary. And if it is perceived as such here, that won't be good for her politically, but if she can help Governor Jindal get this red tape cleared up so we can escape from this anomaly here, that's a good thing.

BLITZER: Well, that's a good issue, Jamal. And I guess what concerns me a little bit is that this is supposed to be health care reform. Maybe that $100 million to deal with this Medicare problem in Louisiana is worthwhile, but should that be in this legislation, historic legislation, to reform health care reform, or maybe it should be in some other legislation dealing with appropriations for Louisiana and a whole bunch of other states that might need some remedies?

Why is this $100 million in what's supposed to be historic health care reform legislation?

SIMMONS: Well, you know, cost and spending have always been a big issue, and also some issues around Medicare. And what you're hearing from some of the Republicans is that the Democrats want to cut Medicare, they want to cut your Medicare, which is quite ironic. The Republicans would be the ones who are arguing about saving Medicare.

But everything is going to be in this bill that it takes to get the bill across and get it finished and get it done, and that's where Democrats are focused. And I think the president and the White House are focused, so they're going to do what it takes to finish it.

Mary just talked a little bit about, you know, the wide-ranging views in the Democratic Party. The issue right now is the Democratic Party is a big-tent party. We have one race in conservative and moderate districts across the country, and, therefore, more progressive members have to negotiate with conservative and moderate Democrats. And that's where we are.

BLITZER: All right. But Jamal, you didn't really answer the question. The question is, why does this money have to be in health care reform legislation, as worthwhile as it might be?

SIMMONS: You know, Wolf, I think you're going to have to ask one of the legislative leaders in the room about why they put that in the bill. All I know is when you talk to these folks up on Capitol Hill, what they tell you is they are doing everything they can to get this bill through and address the needs of their members.

BLITZER: Mary, the DNC is now using Sarah Palin to try to go out there and raise money. They've got a new ad they are running.

As we approach the final sprint on health reform, we can't afford more deception and delay. We need to be ready for anything and have the resources to respond with ads, events and calls to Congress when the attacks come. So we're setting a big goal, $500,000 in the next week, to help push back against Sarah Palin and her allies. Please chip in $5 to help reach our goal."

Is she going to do some financial wonders for the DNC, Mary?

MATALIN: This is -- I love this. They can't decide if she's a dope, a diva or a super destroyer.

They are sucking money out of a finite fund. Political givers are not inexhaustible to be used against a person who is not even running. So go for it. I mean, it's hilarious that they are so afraid of a person that they have such little regard for and can't insult enough. I'm finding it all so very amusing.

BLITZER: What are you finding it, Jamal? Is she helping or hurting fund-raising for the DNC? SIMMONS: We refer to Sarah Palin as the gift that just keeps on giving. Every single time she comes out in public it is a boon to Democrats.

It turns off moderates and Independents. She fires up the conservative Republican base, which is great for us, because she also fires up the Democratic base.

The DNC is raising money off of her. Any other candidate -- I mean, I think we saw what happened in New York in the special election.

Candidates should be nervous about having Sarah Palin come in and endorse you. She's not exactly going to be the signal for your success.

BLITZER: We've got to leave it there, guys. Thanks very much.

Jamal Simmons, Mary Matalin, they will be back.

It's enough to make Botox users furrow their brows. Quite an uproar over a proposed tax on cosmetic procedures to help pay for health care reform.

Jack Cafferty is standing by with your e-mail.

And another member of Senator John McCain's family is making his mark on Twitter. This time behind the camera.

And the Pentagon faces questions about the alleged Fort Hood gunman and whether he was in fact an Islamic extremist. If so, could the military have simply given him the boot?

(COMMERCIAL BREAK)

BLITZER: Let's get right to Jack for "The Cafferty File" -- Jack.

CAFFERTY: The question this hour, Wolf: Should the government tax cosmetic procedures like Botox, tummy tucks and liposuction to help pay part of the cost of health care reform?

Spring writes, "I love this idea. Those procedures are purely self-esteem issues. I have no problem adding a tax to them as long as those who are getting it for good reason, such as an accident or other medical reason, don't have to pay the tax."

Danny writes, "Why not? If you can afford cosmetic surgery, you can surely afford to donate some money to people who can't even afford basic medical care. At least this tax can't be passed on to the people we're trying to help, like the tax on medical devices."

Russ in Colorado, "No. These elected procedures have nothing to do with health care. If we let them get away with this, they'll be taxing pet food and CDs in order to pay for high-speed rails next. That would make about the same amount of sense." Ivan writes, "Why not? I paid a 10 percent tax on a sausage, egg and cheese sandwich this morning. That's the rate on eating out in our nation's capital."

Karen in Arizona, "Taxing elective cosmetic procedures is an utterly ridiculous solution. I believe there is far more money to be raised by taxing unhealthy life choices such as cigarettes, fast food, soft drinks, et cetera, which actually contribute to rising health care costs. Why not impose a tax on these items and attempt to limit their consumption?"

Sue in Idaho writes, "You betcha it's a good idea. I've had all mine done."

And Don in Pennsylvania says, "Yes, and start with Joan Rivers. That alone could substantially reduce the national debt."

Cruel.

If you didn't see your e-mail here, you can go to my blog at CNN.com/caffertyfile -- Wolf.

BLITZER: Very cruel indeed, Jack. Thank you.

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

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