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"Morning After" Pill for U.S. Troops; Toyota Chief: "We're Sorry;" Jobs Numbers "Cause for Hope;" Bill Clinton Talks to CNN in Haiti; Dems Vent Jitters & Frustrations; What Tea Partiers Really Want

Aired February 5, 2010 - 17:00   ET

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


WOLF BLITZER, CNN ANCHOR: Rick, thank you.

Happening now, a new move by the U.S. military to make, the so-called "morning after pill" more available. This hour, the troops, unwanted pregnancy and the culture wars.

Plus, critics say a new apology from Toyota's chief is too little, too late and many Prius owners, in particular, wanted more. The recall crisis is rocking the Japanese carmaker to its very core right now.

And bracing for the whiteout at the White House -- a winter storm is bearing down on the mid-Atlantic and it could paralyze the nation's capital with up to 30 inches of snow. We're tracking the travel delays, the danger across the region.

I'm Wolf Blitzer.

You're in THE SITUATION ROOM.

But up first this hour, a provocative new move by the Pentagon to prevent unwanted pregnancies within the ranks. The goal -- to make the emergency contraception pill known Plan B One-Step more available to U.S. troops around the world.

The conservative Family Research Council is blasting the move because it contends the drug can destroy a human life.

Meanwhile, pro-choice is praising the decision as a needed policy shift that the Bush administration resisted.

Let's bring in our Pentagon correspondent, Chris Lawrence.

He's working the story for us -- Chris, what's the Pentagon telling us about this?

CHRIS LAWRENCE, CNN PENTAGON CORRESPONDENT: Well, Wolf, what the Pentagon is doing is it's making it mandatory that all female troops anywhere in the world now have access to this drug. Now, a number the military hospitals and pharmacies already carry Plan B One-Step as an optional drug. What this does is it puts it on a list of medications that every military hospital and pharmacy has to carry. So that's the big difference.

Female troops in places like Iraq or Afghanistan will now have access to this pill.

Now, a panel of doctors and pharmacists made this recommendation. And the Pentagon says this was a clinical move, not a political one, although a -- a similar panel made a similar recommendation back in 2002 under former President George W. Bush. It was not pushed through.

And just to clarify so you we really understand what we're talking about here, Plan B One-Step is an emergency contraceptive. Basically, if you take it within three days of unprotected sex, it -- it -- it doesn't allow a fertilized egg to embed in the uterus and thus start a pregnancy. It has no effect once a woman is already pregnant, unlike RU-486, that so-called abortion drug -- Wolf.

BLITZER: The -- the whole issue of unwanted pregnancies in the U.S. military, it's a big issue for the military?

LAWRENCE: Yes, that's right. You know, this decision is coming just two months after a commander in Iraq tried to enforce a clause in the -- the Code of Conduct that -- that would make getting pregnant or getting a fellow soldier pregnant while you were deployed a punishable offense. And that set off a firestorm, including a lot of pressure from some senators right here on Capitol Hill. And that order was eventually rescinded.

But the idea behind it was that getting pregnant while you're deployed or the men who contribute to that pregnancy, force the pregnant woman to go home and that, in turn, weakens the unit while they are deployed at war.

BLITZER: Chris Lawrence working that story for us.

Thank you.

Turning to the story making so many people nervous and costing Toyota a fortune -- lots of embarrassment. Right now, the chief executive wants the world to know Toyota is sorry. In front of reporters, he apologized for the recall affecting more than eight million cars. But Toyota's chief executive did not announce a new recall and did not announce a solution for brake problems in its popular Prius hybrid.

What does it all mean for Japanese business leaders?

What does it mean specifically for them to apologize?

Brian Todd is looking into the story a little bit more closely -- Brian, what are you finding out?

BRIAN TODD, CNN CORRESPONDENT: Wolf, it was a real spectacle to watch Akio Toyoda to apologize, but certainly not you heard of for a Japan CEO to do something like that in public. Still, their style is certainly different from their American counterparts.

(BEGIN VIDEOTAPE)

TODD (voice-over): A Friday evening news conference in Japan -- not exactly the peak of the news cycle for a titan of industry to apologize for his product.

AKIO TOYODA, TOYOTA MOTOR CHIEF EXECUTIVE (through translator): The current problem is a huge problem and it is a critical situation.

TODD: Akio Toyoda, grandson of the company's founder, speaks formally for the first time during this crisis over the safety of Toyota's cars.

How rare is this sort of apology for a Japanese business leader?

JEREMY ANWYL, CEO, EDMUNDS.COM: ANWYL:

MICHAEL AUSLIN, AMERICAN ENTERPRISE INSTITUTE: Within that culture, there is this expectation for the responsible party or the -- the person running the company to express remorse and to accept shame.

TODD: Jeremy Anwyl, a former consultant for Toyota, now runs Edmunds.com, a consumer Web site for car buyers. Anwyl says in Japan, CEOs often make one high profile apology, then fade back into the shadows. But in America, the leader of a troubled company would be expected to take a media tour, to repeatedly show remorse, to explain, reassure.

ANWYL: Here, we're very familiar, very comfortable with the idea of sort of the celebrity CEO -- the chief salesperson for the corporation, if you will. And in Japan, it's very, very different. They have a much more homogenous society. There is a saying that you might have heard that the tallest blade of grass tends to get cut off.

TODD: The culture in Japan, analysts say, is for the brand, not the CEO, to be the center of attention. As one expert said: "Their identity is the company."

Japan expert, Michael Auslin, says that's certainly the case for this company's namesake.

But what about his future?

(on camera): What does this do to his standing in Japan among consumers and in the business culture -- this apology?

MICHAEL AUSLIN, AMERICAN ENTERPRISE INSTITUTE: Yes, that -- that's a big -- it's a big question, if it was enough and it was too late. And that's what you hear a lot of voices saying. I think the jury is out. And -- and the worries are that -- that he may not have done enough, even though it's clear he's sincere.

(END VIDEO TAPE)

TODD: Now, Auslin and other experts say Akio Toyoda may get a bit of a pass here because he's relatively new to the job. He took over as CEO of Toyota just last summer and some of these problems are generally seen to have been developed not on his watch.

But how he and his company handle this in the next few months, they say, will likely determine whether he survives. Legacy or no legacy, Wolf, he could be on the block if they don't get out of this in the next few weeks.

BLITZER: There seems to have been another cultural change, Brian, at that news conference earlier in the day.

TODD: It was really noted that reporters did not show the typical deference that they sometimes do to Japanese CEOs. They were combative. They demanded answers. You know, this could be the phenomenon of the Internet and mass media, but clearly the culture of, you know, the way reporters cover the -- the corporations there is changing, as well.

BLITZER: The Americanization, if you will, of Japanese reporters.

TODD: It could be. It could be.

BLITZER: Because normally, the Japanese reporters are very deferential.

TODD: Right. They are.

BLITZER: But at this news conference, they were lively.

TODD: They were very lively. They were -- again, they were just -- they were really kind of pressing him. And he -- he was taken aback by it. The -- the culture there is changing.

BLITZER: Brian Todd, thanks very much.

We're going to go to Tokyo in our next hour and speak to Kyung Lah.

She's got more on this story for us.

The first Tea Party Convention is underway, with plenty of anti-Obama rhetoric. But members of the group tell us they hope to get beyond all the partisan name-calling. This hour, a conversation with Tea Partiers about what they really want.

(COMMERCIAL BREAK)

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

CAFFERTY: First it was the banks and the car companies, now it looks like Social Security might be the next in line for a taxpayer bailout.

"Fortune" magazine's Allan Sloan wrote a great column about the fact that, for the first time in 25 years, Social Security is taking in less than it's spending on benefits. That's because for decades, the government has been using the surpluses from the nation's largest social program to pay for other stuff. And now Social Security is running out of money and consists of little more than a bunch of IOUs.

Sloan points out that no one has officially announced that Social Security will be cash negative this year, but it becomes pretty clear when you look at the report from the Congressional Budget Office.

It's outrageous. Another bailout looming on the horizon because the federal government mismanaged these surpluses that were never intended for anything except Social Security. And because there's no surplus, there's no interest income, either -- tens of billions of dollars that are nothing more than a bookkeeping entry because the cash which would have been earning that interest, it's all gone, replaced by IOUs.

Things haven't been so bleak for the government trust fund since the early '80s, when it came very close to running out of money. Back then, the government wounds up trimming benefits, raising taxes. And that led to significant cash surpluses.

Meanwhile, Social Security already provides more than half the income for most retirees. And with millions of people seeing their home values sink, stock market portfolios slashed, well, it probably means they'll even be more dependent on Social Security in the future.

So here's the question -- what should be done about the government's squandering the Social Security surplus?

Your thoughts, please -- CNN.com/caffertyfile -- Wolf.

BLITZER: People have serious thoughts. This is a really important subject, Jack. I'm glad you brought it up today.

And I think you're going to enjoy this next conversation that we're going to have, because it follows up on something you noticed yesterday ahead of the pack. Stand by for a moment.

President Obama is welcoming an unexpected dip in the unemployment rate. It fell to 9.7 percent in January, the first time it's been below 10 percent since this past summer. At a small business conference in Maryland, the president said America is starting to dig itself out of its economic hole.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Now, these numbers, while positive, are a cause for hope, but not celebration, because far too many of our neighbors and friends and family are still out of work. We can't be satisfied when another 20,000 have joined the ranks and millions more Americans are underemployed, picking up what work they can.

(END VIDEO CLIP)

BLITZER: Today's numbers show the jobs crisis in American still runs very, very deep. As the president mentioned, a survey of businesses found that employers shed 20,000 jobs last month. And the government now estimates -- get this -- 8.4 million jobs vanished since the start of the recession in December 2007. That's up from the previous government estimate of 7.2 million.

Let's bring in our senior political analysts, Gloria Borger and David Gergen.

They're joining us now. So it goes down, David, from 10 percent to 9.7 percent. Still 20,000 jobs were lost. And overall, the estimate of people who have lost their jobs goes up more than a million since these numbers have been fluctuating and they take a closer look all the time.

This is as -- as positive as you want to put it, it's still pretty sad.

DAVID GERGEN, CNN SENIOR POLITICAL ANALYST, FORMER PRESIDENTIAL ADVISER: Well, it's still -- it's still a grim picture for millions upon millions of Americans. This one is a mystifying report, because, ordinarily, of course, Wolf, when the economy loses jobs, the unemployment rate goes up. And here we have the economy losing 20,000 jobs last month -- to be sure, a lot better than we were only a few months ago -- but still, we lost jobs and yet the unemployment rate falls. It fell from 10 percent to 9.7 percent, which is -- sort of defies gravity in some ways.

And it's partly due, apparently, to some ways -- new ways of measuring the statistics, trying to come to grips with it.

I think most economists are -- see the economy toning up. It's got a better tone than it did.

But even so, there's a realization that building the jobs of the future, this is going to be an agonizingly slow process. There are just not a lot of sectors where you can look at it and say, wow, that's going to take off soon.

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: You know...

BLITZER: I guess, in part, Gloria, the -- the 9.7, the number goes down from 10 percent to 9.7, but 20,000 more people...

BORGER: Right...

BLITZER: ...are unemployed. I think it's, in part, because more people have entered the job force looking for a job or trying to find a job.

BORGER: Right.

BLITZER: That's why you see that inexplicable, you know...

BORGER: That's right.

BLITZER: ...contradiction, if you will.

BORGER: That's right. And when you also delve into these numbers Wolf, there's something called the underemployment rate. And that's very important. That's those who have given up looking for work or who were forced to go part-time for work. And that number is at 16.5 percent.

When you think about it, that's triple what it was three years ago. So these are just folks who have -- who have given up and said, I'm going to stop looking for work for a while, because there's nothing out there for me. And that creates more economic anxiety. And that's the cycle -- that's the cycle we're in right now.

BLITZER: And the other...

GERGEN: And the...

BLITZER: Go ahead, David.

Make your point.

GERGEN: Well, I -- it's just -- when you've added -- when -- when the unemployment numbers we -- we realize there were an extra million people, as you just reported...

BORGER: Right.

GERGEN: ...who we didn't count before, you realize that these statistical surveys do have a lot of problems in them.

BORGER: Yes.

BLITZER: Yes, they obviously do have. We mentioned that Jack pointed this out yesterday.

Let's talk about what's happening in Europe right now, because we haven't paid a lot of attention to this, but it's -- the markets clearly have paid attention. It's called the PIGS -- these countries -- and this is the acronym, PIGS -- Portugal, Ireland, Greece and Spain -- David, a lot of people fear these -- these countries that are -- they're in such great debt, they could go broke.

GERGEN: Absolutely. And it's a warning shot across our bow, if I may say so. Wolf, the good current news short-term is that there's so much instability over finances in Europe that people are fleeing to the dollar. So the dollar has gotten a lot stronger and, actually, our -- our bond prices have gotten better.

But the -- but the -- I -- I'm -- I had lunch today with a -- with a guy who built one of the biggest hedge funds in the country. And he said, look, this is a shot across the bow because what's happened in Greece, which is causing a lot of this instability, is their -- their debts -- their deficits are up to 13 percent of their GDP.

Guess what?

The United States, it's above 10 percent. And -- and Greece, they -- they've had a real fall in -- in people who want to buy their bonds. And they're -- they're having a hard time paying their -- for their debts. And that's the future the United States faces off in the future...

BORGER: Well...

GERGEN: ...as Jack Cafferty and others have been reminding us, unless we get these deficits under control. BORGER: You know, our -- our -- our deficits right now are completely unsustainable. Everyone agrees. And David Sanger, in "The New York Times," posed an interesting question earlier in the week, which is, could we face the same fate as Japan faced over the last decade because of its economic situation and because of its debt?

And, you know, that's a -- that's a real problem for us right now. And he quoted Larry Summers, who is now one of the president's top economic advisers, but this is before he went into the administration, as saying, how long can the world's biggest borrower remain the world's biggest power?

BLITZER: Yes.

BORGER: And that's a real question we ought to be thinking about...

(CROSSTALK)

BLITZER: It's a (INAUDIBLE) problem.

BORGER: ...right now.

BLITZER: And the healthy -- the healthy numbers -- 3 percent, if you want a healthy economy, 3 percent...

BORGER: Right.

BLITZER: ...the deficit should be 3 percent of GDP, not 10 percent; certainly not 13 percent. Three percent is -- is what they strive to achieve and we're not even close to that right now.

BORGER: And that's -- and...

GERGEN: We're a long way away.

BORGER: And that's one of the reasons the president says we can't have an open-ended commitment in Afghanistan, for instance, because we just can't afford it.

BLITZER: We can't afford a lot of this stuff.

All right, guys. Thanks very much.

The tragedy in Haiti is a top priority for the former president, Bill Clinton. He travels to the country. Wait until you hear what he's now saying. Joe Johns caught up with Bill Clinton. Stand by.

(COMMERCIAL BREAK)

BLITZER: Fredricka Whitfield is monitoring some of the other top stories in THE SITUATION ROOM right now -- hi, Fred.

What's going on?

WHITFIELD: Hello to you, Wolf. Well, consumer financial protection is a question mark on Capitol Hill today after lawmakers reached what's being called an impasse. Democratic Senator Chris Dodd, the chair of the Senate Banking Committee, says he'll continue to push forward with legislation for a consumer financial protection agency. But Republicans like ranking committee member Richard Shelby are concerned the agency ignores the well-being of financial institutions. The committee could vote on a reform package this month.

And authorities say one shark is to blame for the death of this man, Stephen Schafer. He was about a quarter of a mile off the shore in Stewart, Florida when he was attacked Wednesday. A lifeguard said there were three sharks surrounding him. Schafer sustained two bites and died from blood loss. No word yet on the type of shark responsible.

And the U.S. Coast Guard is investigating why this plane carrying two Coast Guard auxiliary members was forced to land without some of its landing gear in Florida. The pilot of the Cessna 414 was made aware of a malfunction prior to landing yesterday, but was still able to bring the plane down safely on its nose, as you see right there. The cause of the problem is still being investigated -- Wolf.

BLITZER: That's scary stuff for any pilot, I'm sure about that.

WHITFIELD: Yes, very frightening.

BLITZER: All right, Fred. Stand by.

In another aviation incident, officials say the pilot and copilot are dead in a helicopter crash in the Dominican Republic. Apparently, they were American citizens part of a mission to help Haiti. The helicopter was registered to a company in Florida. The cause of the crash is under investigation right now.

Bill Clinton returns to Haiti to see the latest on the relief efforts underway there.

CNN's Joe Johns caught up with the former president.

Joe is joining us live from Port-au-Prince.

So what is -- what is the former president doing and what is he saying -- Joe?

JOE JOHNS, CNN CORRESPONDENT: Well, he's going around Port-au-Prince, Wolf, talking to people, including some of the top leaders of the Haitian government.

Of course, when I caught up with him and asked him the thing that's on a lot of people's minds back in the States -- and that is about these missionaries that are being held in a jail here in Port-au-Prince on charges of allegedly trying to spirit away 30 some odd Haitian children.

It's pretty clear, number one, that there have been some conversations about that. As I said, he's talking to the prime minister, the president. But what he said was the officials here are trying to make sure that this does not become a distraction that takes away from the larger effort of rebuilding Haiti.

He also said he thinks that the officials here will be able to work together to try to defuse the crisis, in his words.

I also sort of talked to him about the -- the general notion that since the United Nations gave Bill Clinton additional powers early this week, a lot of people are wondering, what do those powers entail?

How far will those powers go?

He gave me a very direct answer to that question.

Let's listen.

(BEGIN VIDEO CLIP)

BILL CLINTON, FORMER PRESIDENT OF THE UNITED STATES: They are.

JOHNS: What's your role?

You got new powers this week.

Could you give us a little idea...

CLINTON: Oh, I got (INAUDIBLE)...

JOHNS: ...people want to know if you're going to be governor of Haiti?

CLINTON: The answer to that is no. And I don't know how much new power I got.

What I was asked to do was to extend my mandate as the U.N. special envoy through the reconstruction and the rebuilding phase. And that makes sense if the government of Haiti intends, as I believe they do, once the damage assessment is done here, to fold in what they're doing here with the -- with the development plan they were pursuing with me and the U.N. before this happened.

(END VIDEO CLIP)

JOHNS: I also asked him about Haitian president, Rene Preval. You know, Wolf, as we've gone around this country talking to people, there are a lot of people who say they think this government and the president are ineffective in Haiti.

And President Clinton's response was, in his view, Preval has certainly put the right people in place to try to stand up Haiti and bring it out of the -- the morass and the continued crisis it's had over the last many decades.

So a -- a vote of confidence, I will say, for the government of Haiti. Nonetheless, Bill Clinton is here with his expanded powers. BLITZER: Yes.

JOHNS: Wolf, back to you.

BLITZER: All right. And let's hope he makes a difference. God knows, they need a lot of work where you are, Joe.

Thanks very much.

We're going to check back with Joe and get more of his interview with the former president.

That's all coming up.

Meanwhile, top Democratic Party officials are meeting here in Washington. We want to get beyond the big names, the standard spin and find out when rank and file party members -- what they're thinking right now.

Our Dana Bash has been chatting with DNC members. She's getting a lot of anxiety from them. Stand by. We'll explain.

(COMMERCIAL BREAK)

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

Happening now, Tea Party activists reveal what they really want. And we reveal our brand new poll that shows your thoughts about them.

The U.S. will kill terrorists around the world, but if those terrorists are American citizens, it creates a controversial question -- should the U.S. assassinate -- assassinate its own citizens?

And anytime you step on a plane, secretly, there may be some air marshals who can act fast should anything happen.

But our are our anti-terror efforts being bogged down by agency politics or even worse?

I'm Wolf Blitzer.

You're in THE SITUATION ROOM.

Here in Washington right now, there's a big chill going down the spines of many Democrats and not just because we may be socked in by some monster winter weather. Members of the Democratic National Committee are meeting right now and they're venting their worst fears for this election year.

Our senior Congressional correspondent, Dana Bash, is here.

She's been -- went over to the DNC meeting to talk to some of these folks.

I guess they're a little nervous, huh? DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT: That's right. We spent all morning at the DNC gathering. It's at a hotel just -- not far from here. And what we encountered were party leaders and activists trying to shake a serious case of the political jitters.

(BEGIN VIDEOTAPE)

BASH: Members of the Democratic National Committee have come from all over the country here to Washington for a meeting. And today, they're split up by regions.

This is the Midwest region. And we wanted to come and talk to some folks in here because the politicians from this region are perhaps the most vulnerable in November.

REP. DEBBIE WASSERMAN SCHULTZ, DNC VICE CHAIR: This is a region of the country where we have made historic gains. The blood, sweat and tears you put in the last few cycles, we need to duplicate it in the 2010 elections.

RICK STAFFORD, DNC MEMBER, MINNESOTA: When I was State Chair of Minnesota in 1994, which was two years into the first term of President Clinton, and that was a rough year for Democrats nationwide.

BASH: Are you having some deja vu?

STAFFORD: Yes, a lot of the storm clouds have come back. People are frustrated. I think people voted in large numbers for change to happen or significant changes to happen. They haven't seen that.

BASH: So this is where the Democrats from the eastern region are meeting, and that of course includes Massachusetts. So let's go in and see what the Democrats from that state are telling their brethren about what happened there.

DEB KOZIKOWSHI, DNC MEMBER, MASSACHUSETTS: There are so many ways that we did miss the ball, and I'm not one to -- but it was all about Massachusetts. It was not about (inaudible).

BASH: All right, now, you're coming out of the region? They were just over in the eastern.

PATRICE ARENT, DNC MEMBER, UTAH: Different kind of Democrat with some of the same values.

BASH: What's it like as a Democrat out in the country in Utah looking at the way Washington is working under democratic control? Big concerns?

ARENT: Certainly we have concerns and certainly we have to be able to explain what's going on much better.

GILDA COBB HUNTER, DNC MEMBER, SOUTH CAROLINA: I'm the chair of the southern caucus. There are a number of colleagues who are extremely concerned that Democrats appear to like the best continual fortitude to get the job done. What we want is a Congress that understands the importance of standing, even if you have to stand alone and fighting for what you believe in. That's critical. We have the spirit in the southern. We just want a little southern spirit.

BASH: As you can see there, the overriding theme we heard from Democrats and from all over the country is frustration, Frustration that democrats here Washington are squandering what activists worked so hard for in 2008 and of course, it's controlled.

The White House and huge majorities in the House and Senate and I should tell you that the president will address this conference tomorrow morning. It will be interesting to see if he changes their minds or at least alleviates some of their fears.

WOLF BLITZER, ANCHOR: Yes, lots of conferences going on with these politicians. RNC in Hawaii the other day, now the DNC here in Washington, Tea Party going on in Nashville. We're watching it all. Dana, thanks very much.

In Nashville right now, members of the Tea Party Movement are demanding alternatives to the usual sniping between Democrats and Republicans. We're trying to get beyond the bus tours and protests and find out what the Tea Party members, what do they actually want?

What are they thinking about right now? Our Mary Snow is over at this first Tea Party conference that's been going on in Nashville. Mary, you've had a lot of conversations with the folks who gathered in Nashville. What are they saying?

MARY SNOW: You know, Wolf, the topics really ranged today from God to grass-roots efforts. The people here, 600 of them, spent a good part of the day learning how to become political activists.

(BEGIN VIDEOTAPE)

SNOW (voice-over): Liberalism kills kids, reads one poster in defense of mixing church and state (inaudible). Not far away t-shirts are on sale. Freedom brewing is one, others are more pointed and then there's the Tea Party jewelry. For Brandon Smythe, his reminder of the Tea Party Movement is on his iPhone.

BRENDAN SMYTHE, TEA PARTY MEMBER, IDAHO: With the click of a button, I've got the United States Constitution, Articles of Confederation.

SNOW: Brandon and his wife, Michelle, travel from Boise, Idaho. They said they were never politically active until last year. They attended grass-roots how-to sessions here. This one how to organize protests like this, getting your message out on new media.

In terms of practical information, Smythe learned, on a radio show or someone within my - the tea party group on the radio show. To blast that out to all our members or even other members to show we're going to be on. What time and have the phone number on the phone with one touch, you're calling in.

SNOW: Among the members, there are different missions and messages. Smythe says he's not interested in running for office, but making the political process more transparent. He often cites the constitution and personal freedom.

SMYTHE: Freedom is individuality, you make the choice for yourself and you go out and accomplish those things which you want to accomplish.

SNOW: I asked him how far he wants the government out of people's lives. Does that mean cutting social security and unemployment benefits?

SMYTHE: I think families, churches, neighborhoods should take care of those.

SNOW: So we should not have social security?

SMYTHE: I personally don't believe in that. Now, that's different than the rest of my group on some of these things, but like I said again, when we're not running for office, we're holding the ones accountable who are running for office. The Tea Party doesn't have to have a stance on that.

DORIS GENTRY, TEA PARTY MEMBER, CALIFORNIA: There are definitely people who have a philosophy that if there's absolutely no laws and no rules, you know, man will governs himself, and, you know, stepping back from that about halfway in the middle you'll find me. I'm definitely a strong conservative.

SNOW: Doris Gentry is unlike many others here. She says she's been involved in politics her own life and currently returning for an assembly seat in California. She learned how internships and listened to why Christians must engage. She says while there are many beliefs among the crowd, she sees one central theme.

GENTRY: I think we're a pretty good, radical, cohesive group of conservativism, less taxes, less government, less means more. I think that's a pretty resonating message here.

(END VIDEOTAPE)

SNOW (on camera): You know, Wolf, while members have different messages, they all seem to be in sync with organizers who today reiterated they don't want to form a third-party candidate -- Wolf.

BLITZER: Thank you, Mary. The conference opened up with some controversial remarks by former Republican Congressman Tom Tancredo of Colorado, what happened?

SNOW: Well, you know, Wolf he kicked off the conference last night. One of the things he said was that President Obama is a socialist. He also made a comment saying that people who couldn't even spell the word "vote" have now created what he called this socialist ideology.

You know, we asked some of the organizers about that, and the organizer here today said he thought that Tancredo's speech in his words was a fantastic speech and agreed about the socialism comment. I did ask another organizer this morning, who had a very different message.

He said that he found those comments problematic, and that they did not nothing to move dialogue forward. There also was mixed reaction among some people today. Some cringed at the comments, but many others say they didn't feel there was anything controversial, but certainly is some explosive comments.

BLITZER: All right, Mary, thanks very much. Mary Snow reporting for us from Nashville. We'll check back with her. She's at the Tea Party conference.

We're also going to get more about the Tea Party, learn more about it and whether it's all about independence or something else, whether members really lean Republican Ariana Huffington and Eric Erickson, they're both standing by for the strategy session. Stand by for that.

We're also getting word right now about what went wrong during the attempted Christmas airline bombing, just ahead, a communication gap on board the plane.

(COMMERCIAL BREAK)

Let's get back to Fredricka. She's monitoring other top stories in "The Situation Room." Fred, what else is going on?

FREDRICKA WHITFIELD: Hello again, Wolf. Hello, everyone. Pilots of that Northwest flight almost brought down by a bomb on Christmas where apparently initially unaware of the attempted attack.

FAA administrator Randy Babbitt says a communication gap prevented the cockpit from getting immediate information from crew that a passenger had attempted to ignite a bomb. He says the incident didn't initially register as anything of great seriousness, because the flight crew reported the passenger had attempted to light only fire crackers.

The space shuttle "Endeavour" is set for liftoff on Sunday. Mission managers gave the go ahead after a chance of good launch weather improved to 80 percent. Endeavor will be delivering a new room and observation deck to the international space station.

This country's loss is now China's gain. Panda cousins, the two beloved pandas who up until yesterday called the United States home, are now making new homes in China. The pandas arrived in China on the Fedex plane called the Panda Express. They will be part of a breeding mission to keep their species alive. Wolf, something tells me they're going to be very happy.

BLITZER: Cute little pandas. Thank you, Fred.

There are boiling questions you might ponder over a cup of tea. Are Tea Party activists just a group of people who don't like President Obama, or should President Obama worry? They have a sensible message appealing to conservatives and independents? Arianna Huffington at Huffington Post and Eric Erickson of redstate.com. They are both here.

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Let's talk a little bit about this Tea Party conference going on in Nashville. Joining us is Arianna Huffington of the huffington.com and Eric Erickson of redstate.com, two very popular web sites. Hey guys, thanks very much for coming in.

Eric, you're there right now in Nashville. Is this conference, about 600 Tea Party activists, is it just an opportunity to sort of gang up against the Obama administration?

ERIC ERICKSON, REDSTATE.COM: No, Wolf, actually I'm kind of surprised here that the Republicans may have more to worry about coming out of here than the Democrats. The activists who are here are really firedup. They feel like both parties have betrayed them.

They recognize the Republicans are probably more (inaudible) than the Democrats because of the supposed mantra of small government conservatism, but they admit the Republicans have betrayed them. I think you'll start seeing some Republican being taken out in primaries by these Tea Party activitist.

BLITZER: So you like what you're seeing there, I think, Eric?

ERICKSON: I think so. I've got some concerns about the convention in general, but of the activists, these people are here and committed. They're really tired of both parties spending their money in Washington.

BLITZER: How worried should the Democrats, Arianna? Should the president and other Democrats, especially those who are up for election in November, how worried should they be about this tea party phenomenon?

ARIANNA HUFFINGTON, HUFFINGTON.COM: Well, Eric is right. All incumbents should worry. This movement, despite all the fringe elements that a lot of the media obviously are focusing on is built on a legitimate anger about the system in general.

If you look at what's happening to the middle class, Wolf and how the middle class is crumbling, with a loss of jobs, savings, homes? That's really what's propelling this movement. Barack Obama is the beneficiary of that anger when he ran, because he ran against Washington.

And remember he used to say again and again, one of his greatest applause lines, I haven't been in Washington long enough to know its ways, but I know they have to be changed, but really to a large extent that's what propelled him to victory.

And now the independents and many Democrats and Republicans are feeling that the fix is in and the special interests and the establishments of both political parties are not really looking after the middle class, the hard-working people in the country.

BLITZER: Eric, how much credit should the Tea Party movement shall we say get, for example, Scott Brown's election as the Republican senator in Massachusetts, as opposed to the RNC?

ERICKSON: You know, I think as a movement, the Tea Party activists deserve a lot of credit. Not one of the individual factions, but as a whole, you know, I started hearing about Scott Brown in November and early December from Tea Party activists, not from the RNC, not from the NRSC, the Senate campaign committee for Republicans.

It was the Tea Party activists who started talking in beginning of December, let's surprise everybody and wake up. They were keen enough and aware enough that he doesn't agree on every issue, but does agree on spending and small big issues, and they rallied around and organized in money bum that made him a million a day before the Republicans even started spending money on him.

BLITZER: Ariana, look at these poll numbers. This is our new CNN opinion research corporation poll. We asked the opinion of people out there of the Tea Party Movement among Democrats only 19 percent are favorable. Among independents, though, 35 percent of independents have a favorable attitude toward Tea Party, and 47 of Republicans. That's a pretty significant block, the independents, as you well know, and more than a third of them, they like this Tea Party.

HUFFINGTON: Well, it is a very significant block, but if you ask a lot of additional questions, you see it heart of this support is a lot of anger at Wall Street, at the bailout, at the fact that Wall Street was bailed out, but Main Street is suffering.

So the question is, which way is the tea party movement going to go? Is it going to be taken over by fringe elements that are basically proclaiming a lot of fabricated statements like Obama is a socialist, or taking us down a fascist road? Or is it going to actually propel candidates who are more independent? Remember, Scott Brown ran as an independent Republican, and actually said that Mitch McConnell cannot count on his vote on all occasions.

BLITZER: What's the answer to that, Eric? Is it going to be a Tom Tancredo? Who is going to be the face of the Tea Party movement? Or a Scott Brown?

ERICKSON: I'm going to be somewhere between them. She's rallies the crowd here, Sarah Palin. The crowd loves Jim Demint, but Marco Rubio is challenging the Republican establishment in Utah and Mike Lee in Utah, who probably will beat Bob Bennett.

These are the people that the Tea Party wants. I will tell you this, we'll probably know when the Tea Party Movement has run its course when a leader does stand up and fill the vacuum. The movement exists in the absence of lip fighting for small government right now.

BLITZER: We'll leave it on that note, guys, but we'll continue this conversation down the road.

Something or somebody may be keeping Hillary Clinton up at night. The Secretary of State is opening be keeping Hillary Clinton up at night, because the Secretary of State is opening up in an exclusive interview about threats to the U.S. Candy is standing by. She will join us. We also talk about her new Sunday talk show. Stick around.

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BLITZER: Check back with Jack for the Cafferty file.

CAFFERTY: The question this is hour is what should be done about the government squandering the social security surplus.

Paul in Tennessee, heck, this is no surprise, whenever there is a lot of money sitting around, there is always someone with their fingers in the cookie jar. I would rather bail out social security than the damn banks handing out bonus. Now tell me, where is that Tea Party at?

Steven from Virginia Beach says I reject the premise that social security needs a bailout, what it needs is restitution from the elected thieves who stole the money from our senior citizen's trust fund and hence stole their financial security. Just like the current elected thieves are stealing the financial future of several generations.

Beyond repaying the IOUs, we also need legislation to prevent future thieving from the trust funds and an apology from the Republicans for mocking Al Gore for proposing that very legislation almost a decade ago.

Max says for almost a decade we've been and continue to spent several billion dollars a week chasing guys in caves around on the other side of the world and we have the nerve to ask why we have no money.

Rick says to regain fiscal responsibility is to vote both parties Dems and the GOP out of office and make it clear that the people will no longer be ignored.

Sheldon, I remember when Bush and Gore debated the social security surplus in 2000. It was going to go into the lock box according to Gore. Endless references by both to a lock box which became fodder for media, and I guess someone forgot to actually lock the box.

J.T. of Florida says I have paid into this fund since I was 12 years old. I am now 65. The government took this money by mandate. I had no choice but to pay in. We had a surplus, now we have IOUs. Pay us our money.

And Vern in California says stop the government from using social security funds to pay for other things. The answer is so simple even a caveman could understand it.

You want to read more on this subject, got a lot of mail on this. Go to cnn.com/caffertyfile, Wolf.

BLITZER: All right, Jack. Thank you.

Federal air marshals accused of playing Mickey Mouse games to protecting their jobs and perks. A CNN investigation into a program that is supposed to be improving and making fliers safer.

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We all remember Hillary Clinton's presidential campaign ad about a commander in chief's worst nightmare. A 3:00 a.m. phone call about some terrible threat to the United States. Now that she is Secretary of State, what global dangers are keeping the Secretary Clinton up at night?

Let's bring in our Senior Political Correspondent Candy Crowley. She is the new anchor of CNN's "State of the Union."

You got an exclusive interview with the Secretary of State then you spoke about these threats.

CANDY CROWLEY, SENIOR POLITICAL CORRESPONDENT: Yes, the always interesting secretary of state. Yes, had the 3:00 a.m. ad in mind when I talked to her and I said, look, out there in America, tell us right now, where is the biggest threat towards the U.S.?

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CROWLEY: If you were to say to the American people, this country is the most dangerous to Americans and to the U.S., where is that country?

HILLARY CLINTON, SECRETARY OF STATE: You know, Candy, in terms of a country, obviously a nuclear-armed country like North Korea or Iran pose both a real or a potential threat.

CROWLEY: And you are convinced that Iran has nuclear power?

SEC. CLINTON: No, but we believe that their behavior certainly is evident of their intentions. And how close they are is subject to some debate, but the failure to disclose the facility at Goem, and the failure to accept the reasonable offer by Russia, France and the U.S. through the IEAA to take the low-enriched uranium in exchange for the reactor.

I mean, there is an old saying if you see a turtle on the fence post in the middle of the woods, he didn't get there by accident, because somebody put him there, and so you will draw conclusions from what you see a wrong doing. But most of us believe the greater threats are the transnational non-state networks. Primarily the extremists, the fundamentalists, Islamic extremists who are connected, Al-qaeda in the Arab peninsula.

CROWLEY: Much more of course in this interview, we also talked about Haiti and how she works with the U.N. envoy to Haiti which is of course Bill Clinton and all of the trouble spots, Wolf. We looked at Pakistan and Afghanistan and at the end, a couple of surprises about being the mother of the bride and what the biggest problem is.

BLITZER: Chelsea is getting married, and she has to negotiate a wedding now. It is a diplomatic mission there.

CROWLEY: You know that, don't you?

BLITZER: Yes, I do. Thanks very much, Candy. And Candy starts her new gig this Sunday, and we want to make sure you watch "State of the Union" with Candy Crowley 9:00 a.m. Eastern right here on CNN. She starts off with a great exclusive with the secretary of state.

And to our viewers here in "Situation Room." Happening now, Toyota's president breaks the silence as the company reels from a global recall crisis. We're going to take you inside this news conference. It's unlike any (inaudible) experienced before. Stand by.