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Alive in Haiti; Toyota Sales; Congress' Costly Bill; Spending Freeze

Aired January 26, 2010 - 19:00   ET


WOLF BLITZER, CNN ANCHOR: Happening now, three breaking news stories we're following in THE SITUATION ROOM. Toyota suspends sales of eight models, including some of its most popular ones here in the United States. The car maker deciding a recall didn't go far enough to protect consumers.

Also, an alleged attempt to tamper with the phones at a U.S. senator's office, we're digging for new details on the arrest and why Democratic Senator Mary Landrieu of Louisiana was targeted. Stand by for that.

And a new rescue in Haiti two weeks after the earthquake -- are there hopes that more survivors might be found?

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.

Let's go to the breaking news in Haiti first. A man -- get this -- pulled alive from the rubble exactly two weeks after that devastating earthquake and the U.S. military 82nd's Airborne Division involved. Let's go straight to CNN's Karl Penhaul. He's now on the scene. What do we know, Karl?

KARL PENHAUL, CNN CORRESPONDENT: What an amazing story, Wolf, and the circumstances of this I heard directly from the mouth of (INAUDIBLE). He is a 31-year-old salesman, an ambulance salesman. He was selling soda at the time of the earthquake and became entombed in a building. He said to me from his hospital bed where he arrived about two hours ago now that he survived because right in front of him there was a two-gallon jug of water.

And he says that the water ran out this morning. He couldn't move because his right leg was shattered and then today it appears that a piece of machinery, heavy machinery, was working in that area and then there were Haitian people on top of the debris scavenging for what was left, and that exposed a hole and then they alerted that a man was alive under the rubble.

But what I want to do, Wolf, is patch (ph) you across to (INAUDIBLE). He is normally the chief of surgery at L.A. Children's Hospital, a Haitian American, he's down here helping his people. And he was one of the men that helped in assisting this patient when he was brought into clinic, and I'll patch (ph) you across so he can tell you more about the man's condition and how he managed to survive. BLITZER: All right Karl Penhaul, thanks very much. Let's speak with the physician. Doctor, tell us what you can about this individual, this very lucky individual's condition.

UNIDENTIFIED MALE: Well, Wolf, this is truly a remarkable story, this 31-year-old guy who basically had not seen his family or was presumed dead by his family would -- did not have enough strength to actually scream anymore, but when he heard the Haitians going through the rubble, he was able to mouth enough of a cry that they recognized that he was still alive. And they initially -- they immediately immobilized the Americans who were nearby with the heavy machinery and they got him out. And they brought him to the hospital, and what is really remarkable is that after 14 days of not eating, he is really in very stable condition.

BLITZER: But he did have -- he did have water, Doctor, right? He did have some water that he used over these 14 days?


UNIDENTIFIED MALE: That's correct. He's been drinking water over those 14 days, and as you heard, he just ran out of it this morning.

BLITZER: What's his prognosis, Doctor?

UNIDENTIFIED MALE: Basically, all he has is a femur fracture. He also has some other abrasions partly as a result of pulling him from the rubble, but remarkably, the only thing that he has right now is a broken femur. And we are in the process of splinting right now.

BLITZER: That's his thigh bone, the broken femur. You're going to deal with that. This is going to give hope, as you know, Doctor, to a lot of other people that there might still be people who survived. Maybe they had water, maybe they had some food. They couldn't get out but they're still under the rubble. So what happens now?

UNIDENTIFIED MALE: Well, undoubtedly this is very, very exciting, especially to all of us who have been deeply involved in this medical relief mission and we've seen so many amputations, so many (INAUDIBLE) we could not (INAUDIBLE). To pull this one out under those circumstances and for him to be in such good shape is just exhilarating. So I think that's going to renew our -- I guess our desire and determination to look through those rubbles and see if there are people who may still be alive.


BLITZER: I guess the mission -- the mission, Doctor, will be to remove the rubble important but do it in a very, very careful way in case there are more survivors and there could be more survivors under this rubble. Doc, thanks very much for your information. Thanks for the work. I wish this individual, this 31-year-old man, our best wishes. We hope there are more survivors under the rubble. Karl Penhaul, thanks to you as well. We're going to stay on top of this story and get you more information.

We're going back to Haiti soon, but there is other breaking news we're following right now involving millions, millions of cars on U.S. roads as we speak. We're talking about Toyota. It's stopping -- stopping the sales of eight models immediately -- the problem, an accelerator pedal that can stick without warning. More than two million are already in recall. Our senior correspondent Allan Chernoff is here in THE SITUATION ROOM working this story for us. This is a dramatic move by Toyota.

ALLAN CHERNOFF, CNN CORRESPONDENT: A very big step, and they would not have done it if this were not a serious situation, but as you said, Wolf, the company temporarily halting sales of some of the most popular vehicles in America, eight models in all, the same Toyota vehicles that were recalled just five days ago because of an accelerator that can stick. Toyota says the accelerator can remain in a partly depressed position or return too slowly to an idle position. The models include Rav4, Corolla, some Camry's, Avalon, Matrix, Highlander, Tundra and Sequoia. Toyota said helping ensure the safety of our customers and restoring confidence in Toyota are very important to our company. This action is necessary until a remedy is finalized."

Wolf, they clearly want to try to clean their name, but this is going to hurt them I would think in the short term, at least.

BLITZER: These eight models, where were they manufactured?

CHERNOFF: All in North America, three in the United States. There are factories in Indiana, Texas and also Kentucky. Four factories in the U.S., I should say, and one in Canada.

BLITZER: They got to fix this problem because there are millions of people who are deeply worried right now.


CHERNOFF: You can compare this to the Tylenol situation. Johnson and Johnson took the extreme step years ago of pulling Tylenol when it had been poisoned. In the long run, it really worked out for the company. Toyota is trying to show that they really care about their customer, but in the short term it's a blemish.

BLITZER: Just imagine you're driving 30, 40, 50 miles an hour, and you -- the accelerator, you take your foot off the accelerator, but you know what, it's still going. That can freak you out.

CHERNOFF: Too scary to contemplate.

BLITZER: Very scary, all right thanks very much for that.

Another breaking news story we're following this hour. Four men are now charged with trying to illegally tamper with the phones at Senator Mary Landrieu's New Orleans office. One suspect is believed to be a conservative activist. Let's go to Capitol Hill. Our congressional correspondent Brianna Keilar is digging on this story. All right walk us through what happened, what we know, Brianna.

BRIANNA KEILAR, CNN CORRESPONDENT: Fascinating details from the FBI, Wolf. They say two of these four men went to the New Orleans office of Senator Landrieu and they were posing as phone company technicians, saying that there was something the matter with the senator's phone system. In fact, the affidavit says that each was dressed in blue denim pants, a blue work shirt, a light fluorescent green vest, a tool belt and carrying white construction style hard hats, so the whole nine yards here.

And actually, they were given access to the phone on the front desk of the office. And they apparently fiddled with it, according to the affidavit, they, quote, "manipulated it and declared that the phone system was broken", something was the matter with the phone system in the senator's office. And what's interesting is all the while at this time, Wolf, there was actually a third person who has now been charged, James O'Keefe, who was filming some of this with his cell phone camera. He and a fourth man being charged with assisting in this whole operation -- Wolf.

BLITZER: Now James O'Keefe, to some of our viewers who were following that whole ACORN scandal, is well known because he is the individual who posed as a pimp together with a prostitute trying to expose ACORN. This is the same individual in this arrest; is that right?

KEILAR: This is the same person. He made -- at least law enforcement officials seem to think he is. A guy who made a name for himself last year going undercover, really, with a hidden camera to ACORN offices and getting tax advice on how to operate a brothel. He made a name for himself, became a bit of a darling of conservatives who had long held that ACORN was a corrupt organization.

And check this out, Wolf. There's also another of these four men, his name is Robert Flanagan (ph). He was one who was posing as one of these phone company employees. He's actually the son of the acting U.S. attorney for the western district of Louisiana.

BLITZER: Yes and I assume that includes New Orleans as well. How did they get caught, these four individuals?

KEILAR: Well it seems that actually, according to the affidavit, the senator's office directed them to the building staff because she actually has an office in a federal building. It's not just her office. And so they were told to go to the building staff who asked for their credentials, and it seems that at that point their story kind of unraveled. The FBI got involved and now they're facing felony charges.

BLITZER: Brianna Keilar up on the Hill, thanks very much. We're going to stay on top of all three of these breaking news stories throughout this hour, also President Obama getting flak from the right and the left over his planned spending freeze -- details of what it could realistically accomplish and what the critics are now saying. Stand by.


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

JACK CAFFERTY, CNN ANCHOR: Wolf, hundreds of thousands of dollars, that's how much it cost for a delegation of 59 people led by House Speaker Nancy Pelosi along with members of Congress, staff, and in some cases, spouses and kids to go to Copenhagen, site of the climate summit just before Christmas.

CBS News reports that for 21 congressmen, food and rooms for two nights cost $4,400, and the total hotel bill including meeting rooms came to more than $400,000. Pelosi used to military jets for herself and her party at a cost of more than $100,000 in flight time alone. Hundreds of thousands of dollars of taxpayer money -- has nothing to do with the Obama administration officials, who went to Denmark to actually attend and work at the summit.

Pelosi filed the required expense reports, but so far she has failed to explain why it was necessary for her and her colleagues to make the trip to Copenhagen in the first place. Her arrogance on this subject breathtaking, as for the high hotel charges Pelosi's office says those who stayed two nights were charged a six-night minimum at the five-star Marriott, information that likely was available before Pelosi and her freeloaders made their vacation plans.

Note to the House speaker, we have skyrocketing deficits, a trillion plus dollars a year, a national debt north of $12 trillion in this country. The president is talking about reining in discretionary spending. I wonder if that would have included this junket by Pelosi and her colleagues. I'd be curious to know where Nancy Pelosi gets her sense of entitlement to simply blow hundreds of thousands of dollars of our money at Christmas time so she and her pals can take a little trip to Copenhagen.

Here's the question. Should House Speaker Nancy Pelosi be required to explain her trip to Copenhagen? Go to and post a comment on my blog. Here's a hint -- yes.

BLITZER: That's a good hint, Jack. Thanks very much.

Even before President Obama gives his State of the Union Address tomorrow night, he's getting a lot of flak from both sides of the aisle. Here's the reason. He's expected to call for that partial three-year spending freeze. Jack just spoke about that earlier. Some critics say it goes too far, others say it doesn't go far enough. Our senior congressional correspondent Dana Bash, our senior political analyst Gloria Borger, and our White House correspondent Dan Lothian, they're all covering this story for us. First to you, Dan -- give us the details of the president's proposal.

DAN LOTHIAN, CNN WHITE HOUSE CORRESPONDENT: Well this proposal, Wolf, will impact discretionary spending and the White House saying that taxpayers would save $250 billion. Now we don't know specifically what will be cut, what programs will be cut. I asked Robert Gibbs about that today and he said we had to wait to get the specifics until next week when the budget is rolled out, but we know what will not be cut, and that is the defense, homeland security, veteran affairs and also entitlement programs like Medicare, Medicaid and Social Security. Obviously the White House realizes here, Wolf, that this is just a small piece of this more than $3 trillion budget, but they say it's a small but necessary step they have to take.

BLITZER: A lot of people are asking this question -- to Gloria. Is this really a viable idea or simply a political stunt?

GLORIA BORGER, CNN SR. POLITICAL ANALYST: Yes. I think if you take a look at this, and I want to put up a little pie chart here, Wolf, I love pie charts, and you can see the amount that it is. Non- defense discretionary is less than 20 percent of the budget. When you compare that to mandatory spending that Dan was just talking about, Social Security, which looks like it eats up about half of the budget here, it's not a lot of money.

But it is a big political step for them because they have to prove to the American people that they want to get this deficit under control because that's what the American people care about and that's what their members, at least their moderate members going home, need to tell their voters.

BLITZER: And let's be precise, that 19 percent will remain 19 percent or so.


BLITZER: They're not going to cut any of that. They're simply not going to increase. They're going to freeze it at the current levels.


BLITZER: Dana, when -- and you'll remember this back in the campaign in 2008, John McCain made a very, very similar proposal and the president of the United States didn't exactly like it then. Here's your exchange that you had today with McCain.


DANA BASH, CNN CONGRESSIONAL CORRESPONDENT: He said that your proposal was a hatchet, not a scalpel. What do you think of his?

SEN. JOHN MCCAIN (R), ARIZONA: I think that the president understands now how serious this problem is and that it requires hatchets and scalpels. It requires a hatchet to bring it under control, and it requires a scalpel to eliminate the wasteful and unnecessary spending that characterizes so much of this bloated spending process we're in. So I appreciate the fact that the president has changed his position since the campaign.


BLITZER: All right, very generous comments from Senator McCain. What are liberal Democrats saying about this, Dana?

BASH: They're not happy, at least a lot of them that I talked to. I just bumped into a very strong supporter of the president's, but also a very proud liberal member of Congress who said I can't believe that he's doing this, because from her perspective, her philosophical perspective, the best thing to do is to spend federal dollars, to spend government money in order to get the economy -- keep the economy on the upswing and to create jobs.

And so that is the problem that President Obama has with liberals here. Another thing is that you saw -- or you heard Dan talk about the fact that defense and homeland security, they're not being touched here. We talked to several liberal Democratic senators, Tom Harkin and Ben Cardin, for example, of Maryland and they said that that's wrong, that if you're going to do a spending freeze, why not include those particular departments because so much spending is coming from those departments, and including from their perspective, a lot of waste.

Now I will tell you that the fact that there is a liberal outrage about this that is probably not -- they're not so, so unhappy about that at the White House because as Gloria and Dan were pointing out politically, I think a big reason why they're doing this is to make themselves and make Democrats look less like the big Democratic Washington spenders that many voters think they are, at least voters that perhaps went to the polls in Massachusetts, independent voters that are going to be so important in November.


BLITZER: Dan -- let me bring Dan for a moment -- what else are you hearing about his State of the Union Address tomorrow night?

LOTHIAN: Well clearly a big speech for the president. We're told that his team of speechwriters have been working on this speech now since November, that the president himself has jumped in doing longhand, much like he's done in the past on other speeches. To this point they have not yet wrapped up this speech, but we're told by top aides that the president will be talking about fighting for middle- class families. He'll also talk about bringing down the deficit, about creating jobs, even talk about health care reform, which of course is on life support, but this is a big, big night for the president. He realizes how important it is for him.


BASH: If I could just jump in at that point real fast on health care, Wolf, life support, that's an understatement. The Senate majority leader today said there is quote, "no rush on health care." That is because they are pretty much nowhere on figuring out the very, very difficult process to continue and actually pass the health care bill in light of -- in light of last week's election in Massachusetts and losing that Senate vote.

BORGER: And Wolf, have you ever heard of a president who wasn't fighting for the middle class? I've never met one. BLITZER: They all fight -- they all fight for the middle class. There will be though -- I think it's fair to say, Gloria, at least I've been told that the speech he will deliver tomorrow night on health care and certain other areas, it's going to be different, very different than what he would have said had Massachusetts gone the other way.


BORGER: I think so, because we would still be talking a lot more about health care. Look, this president tomorrow night and Dan knows more about this, is not going to come out with a laundry list like we're used to in these State of the Union speeches. I think it's about what he wants to do over the next year. This is going to be very focused.

He's going to let people know that he heard them and he's going to have to come up with some solution on health care and I guarantee you it is going to be something that's slimmed down, but we'll have to -- we'll have to see, as Dana says, how that -- how that plays out. But he is going to talk a lot about the middle class and about the deficit -- a big, big problem for him. He knows he has got to fix that issue with the voters.

BLITZER: Yes, he's been down before, this president, when he was running for office. I wouldn't, by any means, underestimate his ability to come back. He certainly can. He's got a good team over there working with him. But we'll watch tomorrow night and see how he does. Guys, thanks very much and all of you will be watching with us. You guys have no choice.

We're going to learn a lot more about the president's spending freeze, a lot of other issues, when he gives his State of the Union Address tomorrow night. Join us for our prime time coverage right after THE SITUATION ROOM. It all begins at 8:00 p.m. Eastern only here on CNN.

An arsenal of high-powered weapons and a map of a U.S. military base, that's what police say they have found after a scuffle with a suspect.

Plus, new concerns about Haiti's children, are earthquake orphans at risk of being stolen, trafficked or even exploited?


UNIDENTIFIED FEMALE: That is unacceptable. This is unacceptable and it's not about us, it's not about the physicians alone or the doctors or nurses, it's about these children. That is unacceptable.



BLITZER: Lisa Sylvester is monitoring some of the other top stories in THE SITUATION ROOM right now. Lisa, what else is going on? LISA SYLVESTER, CNN CORRESPONDENT: Hi, there, Wolf. Well government officials say a man accused of keeping a weapons arsenal in a New Jersey motel room had a map of the Fort Drum Army base in upstate New York. Police say they raided Lloyd Woodson's (ph) motel room after he resisted arrest, wearing a bullet proof vest and armed with a rifle. Woodson (ph) was arraigned on multiple weapons charges today. And the FBI says a preliminary investigation indicates he does not have terrorist ties.

U.S. helicopters are helping the Peruvian government evacuate hundreds of American tourists who were stranded near the famous Inca ruins at Machu Picchu. Mudslides set off by days of torrential rains are blocking the only rail line to the area. U.S. officials say as many as 400 Americans may be stranded along with about 1,000 other tourists. The flooding and mudslides have killed several people.

And it is now illegal for commercial truck and bus drivers to text while driving. Under the new federal guidelines announced today by Transportation Secretary Ray LaHood commercial drivers caught texting could face civil or criminal penalties of up to $2,750. LaHood calls the ban an important safety step to eliminate the threat from distracted drivers. A federal study shows that drivers who text are more than 20 times -- 20 times more likely to get into an accident than non-distracted drivers -- Wolf.

BLITZER: Yes, it's really, really dangerous and don't do it. It's very bad. Thanks very much, Lisa, we'll get back to you.

In Haiti right now, there are serious fears for the safety of children, orphans, among others, some whom may be just separated from their parents. We're taking a closer look at the threat of abduction, child trafficking and abuse. Anderson Cooper is on the scene. And a disturbing new account of the conditions inside an Iranian prison where three American hikers are being held.


BLITZER: By any measure what's happened in Haiti ranks among the worst global natural disasters in recent years. The Haitian Health Ministry and the European Union now estimate between 150,000 and 200,000 people were killed, one million people are now homeless. That's one out of every nine people in the country and an estimated 235,000 people have fled the ruined capital of Port-au-Prince using government transportation.

The number who have left on their own right now is simply unknown. Three hundred sixty-three Haitian orphans have been evacuated, but many more orphans remain behind and there is growing concern for their safety. Here's CNN's Anderson Cooper.


ANDERSON COOPER, CNN ANCHOR (voice-over): It is a rare sound in Haiti these days, kids being kids. These are children orphaned by the earthquake now under the care of UNICEF. They have food and shelter and people watching over them. But thousands of other new orphans and children separated from their families are still living on the streets in makeshift camps or overcrowded hospitals. Increasingly, doctors and nurses we've talked to are concerned not just about their medical condition but also about their physical safety.


COOPER: Dr. Laura Asher works in a hospital camp on the outskirts of Port-au-Prince.

COOPER (on camera): How worried are you about the security of the kids here now?

DR. LAURA ASHER, MEDICAL VOLUNTEER IN HAITI: We are extremely worried. We spent all day yesterday and the last four days going down to the U.N., going up the chain of command. We talked to the U.S. Army. We've spoken to the U.S. Air Force. We've done everything -- everything has been documented about our attempts to try to get somebody on base to take care of this camp for all of us.

COOPER (voice-over): She says there was a suspicious man on hospital grounds removed several days ago. She's convinced he was trying to steal a child and feels that no one is listening to her.

ASHER: That is unacceptable! This is unacceptable! And it's not about us, it's not about the physicians alone or the doctors and nurses, it's about these children. That is unacceptable!

COOPER: At another hospital, Dr. Elizabeth Belino says security is tight but she worries constantly about someone taking a child.

DR. ELIZABETH BELINO, MEDICAL VOLUNTEER IN HAITI: I mean we are on full-on lockdown here. I mean we have security walking around at all times, and my eye is constantly on at least, you know, 20 kids. And especially I have to keep an eye out for the orphans.

COOPER (on camera): But you really feel that it's a situation that the kids need actual protection?

BELINO: Oh, yes. Oh, yes.

COOPER (voice-over): UNICEF agrees. They're raising the alarm about the potential for children to be trafficked, stolen for illegal adoptions, sexually exploited, or sold as domestic servants.

BO VIKTOR NYLUND, UNICEF: Well, we have reports coming in that children are being trafficked out of the country, both through the boats as well across the borders through Santo Domingo.

COOPER (on camera): There are a lot of new orphans created by the earthquake and a lot of people around the world want to adopt them. And that's very understandable. But aid agencies like UNICEF say it's critical that there not be new adoptions just yet.

There's got to be a system in place and right now it's just simply too confusing and it's not clear who's a real orphan, who may have one parent, who's just separated from their parents, or who may have an extended family that can take care of them in the days and the years ahead.

(Voice-over): UNICEF has just begun to identify and track unaccompanied children and that process will likely take a long time. For now, however, they're trying to find and protect as many kids as fast as they can.

Anderson Cooper, CNN, Port-au-Prince.


WOLF BLITZER, CNN ANCHOR: Even before the earthquake, the plight of Haiti's children was grim. A study released just last month said that as many as 225,000 Haitian children were living and working as unpaid domestic servants, vulnerable to abuse. A door-to-door survey of more than 1,400 found 22 percent were living away from home.

Thirty percent of the households had arrested back child away from his home or her home. Worldwide, the U.S. State Department estimates 12.3 million children are held as work or sex slaves and more than 2 million children are caught up in the sex trade.

That's worldwide, that State Department report.

There's troubling new information about three American hikers held in Iran's most notorious prison. Two Belgians were recently detained under similar conditions and they paint a rather grim picture of what the Americans may be enduring.

CNN's Mary Snow has been looking into the story for us.

So, Mary, what are you discovering?

MARY SNOW, CNN CORRESPONDENT: Well, Wolf, two Belgian tourists who were in the same jail where the Americans are being held say they had some contact with Shane Bauer, Sarah Shourd, and Josh Fattal. And they say they are deeply concerned about their wellbeing.

The two Belgians were released in December, and they say when they left, the Americans were in solitary confinement. They say prisoners don't have any outside contact, ceiling lights are left on day and night, and they're not allowed to make even eye contact with guards and they're not allowed to talk to other prisoners.

Now the Belgians describe intense psychological pressure during interrogations, say they can only imagine the pressure the Americans are under, too, what they say confess the crimes, they are innocent, and they're pleading for their release.

Today we asked the State Department about any updates it had. A spokesman says the U.S. has demanded that a Swiss diplomat be able to meet with the Americans since U.S. has no diplomatic relations with Iran. But a spokesman says the last time a visit was granted was three months ago.

(BEGIN VIDEO CLIP) P.J. CROWLEY, STATE DEPARTMENT SPOKESMAN: What that tells us is that our three American citizens are potentially in deplorable conditions. It is outrageous that Iran refuses to abide by international standards, international agreements in terms of treatment of those who are in their care.

And we continue -- we will continue to press the Iranian government so that we can see for ourselves what the conditions of our citizens are.


SNOW: The three Americans were detained in July when their families say they accidentally strayed across an unmarked border in Iran when they were hiking. They're being held on espionage charges. Wolf?

BLITZER: They're families, as you know, Mary, they've been fighting for their release. Are they getting any information directly or indirectly?

SNOW: No. And, Wolf, the families say they have now hired a lawyer in Iran, but their children haven't had access to that lawyer. The family did release a statement saying, "On Sunday, they will have been held for six months with no contact with their families, not even one phone call, and have not had access to their lawyer. We appeal again to the Iranian authorities to release our loved ones and end our sorrow."

Now Iran's foreign minister did say back in December that the three Americans will face trial. Wolf?

BLITZER: All right, Mary, thanks very much. Mary Snow is on this story for us.

We've got a lot happening and right now we're going to get back to one of our breaking stories. We've just released -- we just received a statement that's been released from Senator Mary Landrieu on this very bizarre incident in her office in New Orleans. Stand by for that.

Also, is the stimulus turning into jobs for you? We're digging deep to find out just how much is being spent and where all that money is going.

And the U.S. Supreme Court throws out many of the government's campaign finance reforms. In a CNN exclusive, I'll ask the former Supreme Court justice, Sandra Day O'Connor, what she thinks about that.


BLITZER: We're just getting reaction right now, a statement from Democratic senator, Mary Landrieu of Louisiana, involving this bizarre incident in her office in New Orleans. The arrest of four individuals including well-known conservative activists for allegedly entering federal property under false pretenses.

Landrieu now saying this. "This is a very unusual situation and somewhat unsettling for me and my staff. The individuals responsible have been charged with entering federal property under false pretenses for the purpose of committing a felony. I am interested -- I am as interested as everyone else about their motives and purpose which I hope will become clear as the investigation moves forward."

One of these individuals arrested the same individual who was involved in that ACORN sting operation where he posed as a pimp together with a supposed prostitute to expose ACORN's alleged abuses.

We're going to have much more on this story coming up. It's not going away.

Let's get to the stimulus plan right now. It's designed to help jump-start the economy and especially try to put Americans back to work. But is it turning into jobs for you?

This week CNN steps outside the box, unleashing hundreds of journalists to dig deep and examine the facts. Our senior correspondent Allan Chernoff is one of them. He's been working on this.

So what's the bottom line? How much money is actually going toward job creation in this package?

ALLAN CHERNOFF, CNN SENIOR CORRESPONDENT: Wolf, the truth is, very little. The fact is the bulk of the Recovery Act spending so far is not going into jobs programs.

The vast majority of the billions paid out in the first 11 months of the stimulus plan has gone for tax relief and for Medicaid expenditures. And some of the jobs created, well, they're not putting a dent in the unemployment rate because many of the people hired have little problem finding work.


CHERNOFF (voice-over): Dr. Suzanne Walker could easily find a higher paying job. Her skills are always in demand, but she chooses to serve the underserved at this non-profit health clinic in Queens, New York, which is expanding thanks to federal stimulus funding.

DR. SUZANNE WALKER, COMMUNITY HEALTHCARE NETWORK: Our agency Community Health Care Network is still hiring, looking for very good people, people who are dedicated to providing good health care.

CHERNOFF: Like Suzanne, the clinic's new employees -- seven thus far -- also could likely find work elsewhere since health care is largely recession proof. That means Recovery Act funding for Medicaid clinics like Community Healthcare Network is having no impact on the unemployment rate, says Chris Mihm of the U.S. Government Accountability Office, which tracks federal spending.

CHRIS MIHM, GOVERNMENT ACCOUNTABILITY OFFICE: That has not created an awful lot of jobs and there wasn't a great deal of expectation that that would create jobs.

CHERNOFF (on camera): The fact is, three-quarters of all stimulus spending thus far, $190 billion, has gone either for entitlement programs, mainly Medicaid, or tax relief, neither of which does much to create any jobs.

And as the so-called stimulus spending continues, two-thirds of the entire Recovery Act budget is for these two categories, not for jobs.

(Voice-over): What the money is doing is providing sorely needed help to those hit hardest by the recession. Americans on Medicaid and those without health insurance.

(On camera): When the economy turned down, what happened to demand here?

CATHERINE ABATE, CEO, COMMUNITY HEALTHCARE NETWORK: The demand increased. We saw a huge percentage of increase this year. And, again, the uninsured rate is increasing. It's because people lost their jobs, they lost their coverage.

CHERNOFF (voice-over): The private companies in state and local governments that have received stimulus money claim they've created or saved more than 600,000 jobs. But the Government Accountability Office finds that number is unreliable.

Some employers are counting part-time jobs as full-time and others reported jobs but said they had received no stimulus funds.

The real job-producing stimulus funding has only recently begun to be distributed. Money for construction, roads, bridges, and even here at Community Healthcare Network, an expansion to build 20 new exam rooms that should put 70 people to work.


CHERNOFF: And that kind of spending will extend all the way out to the end of the decade. So far, though, the Recovery Act has been more of a social safety net than a job building program. Economists say the recession will be long over before stimulus spending has a big impact on expanding employment. Wolf?

BLITZER: All right, Allan, thanks very much. We're going to stay on top of this part of the story as well.

Our chief business correspondent Ali Velshi is over at the stimulus desk. He's read all of the legislations. He's checking the facts, loopholes and scams, whatever is involved. He knows where they are and now you will as well.

We're going to show you where $862 billion in taxpayer money is going. There are almost 57,000 projects that have been funded so far, so where are the jobs? Will these projects help the economy recover?

Let's go to Ali. He's got the answers. No simple answers, I take it, Ali, but we're learning a lot.

ALI VELSHI, CNN SENIOR BUSINESS CORRESPONDENT: We are learning a lot. Here it is, 57,000 projects here. This is the over $800 billion, not all of that is in these projects. A small portion of it is, but we're calling people and finding out about where the money went and what it's done.

Well, an hour ago we told you about an $841,000 grant to the Texas Engineering Experimentation in College Station, Texas to deal with human robot interaction in areas where a robot is needed. Emergency response, hostage negotiation and health care.

Emily Smith is on our stimulus desk. As I was talking to you about this, she got through to the company and has some explanation as to what this $841,000 is being used for and whether it's created jobs.

EMILY SMITH, CNN CORRESPONDENT: Essentially they're building such (INAUDIBLE) robots that can communicate more effectively with people while they're trapped. So you can talk back to first responders, you can play music that will calm you down, and they believe the technology is invaluable.

Plus they've created three jobs for graduate students and they hope to hire three more in the coming months and years. It's a three- year project and they're one year in.

VELSHI: All right. And it's Texas A&M and...

SMITH: And Stanford University. Texas A&M is building the actual robot and Stanford is charged of the communication side.

VELSHI: All right, so this is what we're working on, Wolf. It's these kinds of things. We're finding out whether the money has been spent and whether jobs are created. Every time we make a call like that, like Emily did, and we start an investigation into one of these projects, we add it to our tally.

So the total number of dollars under review during stimulus project week here at CNN, right now $1.965 billion. So we have taken projects worth this value and have investigated them. Some of them, we have resolution to, Wolf, as you said, some we don't.

Some we found are not getting -- are not having the intended effect. Others we have found are, in fact, and have resulted in jobs. Wolf?

BLITZER: All right, Ali. We're going to stay on top of this throughout the week. Ali Velshi working this story for us.

CNN is committed to tracking your money in THE STIMULUS PROJECT. If there is a town in America that serves as an example of the need for stimulus money, it's Wilmington, Ohio which got national attention during the presidential campaign.

It's a town of about 15,000 people and more than 10,000 of them lost their jobs. They're counting on the stimulus money, and they hope to help bring them back, but so far it's been a huge struggle.

Mary Snow goes back to Wilmington tomorrow. You'll see her report here in THE SITUATION ROOM.

The former Supreme Court Chief Justice Sandra Day O'Connor sat down with me today for an exclusive interview. It's rare she does such a thing. We spoke candidly about two of the court's more controversial rulings.


BLITZER: The former Supreme Court justice, Sandra Day O'Connor, is now speaking out about a controversial ruling by the high court last week. The court gave big business unions, special interest groups more power to spend freely in federal elections.

The decision threatens a century of government efforts to try to regulate the power of corporations to bankroll American politics.

Justice O'Connor sat down with me today at Georgetown University Law School for an exclusive interview.


BLITZER: What do you think of that decision the other day?

SANDRA DAY O'CONNOR, FORMER SUPREME COURT JUSTICE: Well, I haven't even finished reading these 170-some-odd pages. I'm in the process of it now. It did overrule, in effect, a decision which I did help write in 2003 dealing with the McCain/Feingold Act.

We upheld it in the 2003 decision and a majority of the present court overruled a portion of that case.

BLITZER: It was a 5/4, the decision?


BLITZER: If you had been a member on the court, I assume you would have been one of the four?

O'CONNOR: Well, let's left that be. I'll refer you back to my opinion in that case and it differed from the holding of the present.

BLITZER: I know this is an issue. Now it's going to open up the floodgates for campaign fundraising by the corporations, the labor unions, other special interests.

O'CONNOR: Well, I hope that it won't. It could. It has that potential. But...

BLITZER: Are you worried about that?

O'CONNOR: Well, of course I'm worried about it because so much money has been going into judicial campaign races in recent years. BLITZER: And your concern is that, with all this political money going into races, especially judicial races in the states, it could have a what?

O'CONNOR: Well, it has the effect of turning judges into these politically elected figures in arms races, if you will, by people with the means to support them.


BLITZER: I also asked Sandra Day O'Connor to look back on the Supreme Court's role in deciding the 2000 presidential election.


BLITZER: Let's look back a little bit on some history. Bush v. Gore. You remember that case.

O'CONNOR: I remember that.

BLITZER: Looking back, you know, we have had some time to put that, what, nine years now. Was that the right decision?

O'CONNOR: I don't know. It was a hard decision to make, but I do know this. There were at least three separate recounts of the votes, the ballots, in the four counties where it was challenged, and not one of the recounts would the decision have changed. So I don't worry about it.

BLITZER: So you've no regrets as far as that decision is concerned?

O'CONNOR: No. It wouldn't have changed anything.

BLITZER: So the right man was elected president?

O'CONNOR: Well, the man who got the most votes.

BLITZER: That's...

O'CONNOR: That's the -- what it comes down to at the end of the day.


BLITZER: You can hear a lot more of this exclusive interview with Justice O'Connor Thursday right here in THE SITUATION ROOM. She's a fascinating, fascinating, very intelligent woman. She's getting ready to hit the age of 80 as well.

Is New York mayor Michael Bloomberg thinking about a presidential run? He's now hired a big-name political adviser. We're going to tell you what he's saying about that and more right here in THE SITUATION ROOM.

(COMMERCIAL BREAK) BLITZER: We're right back to check with Lisa for our "Political Ticker."

Lisa, what's going on?


Well, Ben Bernanke will soon know if he's going to win a second term as chairman of the Federal Reserve. Senate Majority Leader Harry Reid has scheduled a vote on Bernanke's nomination Thursday. A 60- vote majority is required to overcome procedural obstacles from Bernanke's critics. Opponents say he missed signs of the financial crisis, but supporters insist he took action that helped avoid a deeper crisis.

New York mayor Michael Bloomberg insists he is not interested in running for president in 2012. Speculations about his political ambitions ramped up after he hired Hillary Clinton's former medial strategist as a political policy and communications adviser. But the mayor says hiring Howard Wolfson who helped reelect him does not mean he's finding a future White House bid.

And a close primary race is shaping up for the Republican nomination for an open U.S. Senate seat in Florida. New polls show Marco Rubio, an attorney who once served as speaker of the state House, surging in favorability past Governor Charlie Crist among GOP voters. One telephone (INAUDIBLE) gives Rubio 47 to 44 percent edge over Crist. And that primary, Wolf, is in less than seven months. Wolf?

BLITZER: Plenty of time for both of these candidates. All right, Lisa, thanks very much. See you back here tomorrow.

Jack Cafferty is coming up with "The Cafferty File" after this.


BLITZER: Let's go right to Jack for "The Cafferty File." Jack?

JACK CAFFERTY, CNN ANCHOR: Wolf, the question this hour, should House Speaker Nancy Pelosi be required to explain her Christmastime trip to Copenhagen?

Matt -- we got a ton of mail on this, by the way. Matt writes, "Of course she should be required to explain the trip. Would you not require your employee to explain an expense that was unnecessary in another business? Doesn't she realize that she's our employee?"

Craig in Florida, "She should but she won't. Nancy Pelosi is clearly of the opinion that she is above the masses. She thinks she's better than the rest of the American people. She's arrogant, dishonest, and frankly, not all that smart. Most Americans cringe when they see her face on the TV screen because she will almost certainly embarrass them."

Vicki in California writes, "Yes, she should be called on the carpet for her absolute disregard of what's happening to the people of this country. As a Californian, I can only hope the people in her district were paying attention and watching this arrogant, nasty woman in action. Unfortunately, I don't live in her district so I cannot vote against her."

Chris writes, "What a foolish woman and a disgraceful act. Miss Pelosi preaches fiscal responsibility, but it'll be her actions that will long linger in the minds of independents. I'm included."

Maria writes, "While Miss Pelosi and friends were having fun at our expense, most of us were deciding whether or not to exchange Christmas gifts. Nancy Pelosi should be ashamed of herself for squandering tax money. She's a servant of the people that elected her. She is not royalty."

And Tom in Wisconsin says, "She absolutely should have to explain. I just spent a few days in Las Vegas. Want to bet I had to explain to our wife where our money went?"


If you want to read more about this -- as I say, we got an awful lot of mail on this subject. Go to my blog at

We appear to be out of time, Mr. Blitzer.

BLITZER: Almost, but one quick question. What's the most important thing the president has to do tomorrow night?

CAFFERTY: I think he's got to kind of fess up that the first year has been a struggle, that he's going to try and refocus, admit some of the mistakes he's made, and be a little more sensitive to some of the things he promised us like transparency and openness in government, some of those kinds of things.

BLITZER: I think we'll hear a lot of that. I think you're right, Jack. We'll cover it tomorrow...


BLITZER: ... starting at 8:00 p.m. Eastern.

CAFFERTY: It's a date.

BLITZER: Our primetime coverage. See you tomorrow, Jack. Thank you.

And see you back here in THE SITUATION ROOM tomorrow, 5:00 p.m. Eastern, 5:00 to 8:00 p.m. Eastern. Thanks very much for watching. I'm Wolf Blitzer in THE SITUATION ROOM. Up next, "CAMPBELL BROWN."

ANNOUNCER: CNN primetime begins right now.