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U.S. Warship Attacked by Pirates; Midterm Battle Over Health Care Reform

Aired April 1, 2010 - 18:00   ET


WOLF BLITZER, CNN ANCHOR: Happening now. Somali pirates pick the wrong target to attack-a U.S. warship. The pirates opened fire and the warship fired right back. We're learning new details of a dramatic battle at sea. Also, they're high-tech and controversial. The body imaging scanners possibly coming soon to a local airport near you. I turns out, they're finding a lot more than simply explosives.

And the frenzy over Apple's new iPad is reaching a fever pitch. Doesn't go on sale until Saturday, but we'll have one here, this hour, in "The Situation Room." we'll check it out. We'll test it. Does it live up to all the hype?

I'm Wolf Blitzer. We want to welcome our viewers in the United States, and around the world. You're in "THE SITUATION ROOM."

The "USS Nicholas" is no stranger to battle. It saw combat during the first Gulf War, but the guided-missile frigate has never quite seen anything like what occurred yesterday in the Indian Ocean. That would be a pirate attack, believe it or not. Our Pentagon correspondent Barbara Starr is here with details on what happened. What happened out there?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, you know, believe it or not, Wolf, it is hard. Some days you can't make this stuff up. A group of pirates took on a U.S. Navy warship off the coast of Africa, west of the Seychelles islands. Now, that's thousands of miles off of Africa's east coast.

This is prime pirate territory and apparently a small group of pirates in a skiff opened fire on the U.S. Navy warship, well, the U.S. Navy, to say the least, not amused, they fired right back. They disabled this small skiff. They took pirates into custody and really sending a message that this is not something that's going to be tolerated.

BLITZER: This was hundreds of miles off the coast, right? How do these pirates get out there?

STARR: Well, you know, this is the sophistication of these pirate operations these days. They were in a small skiff, and they came from, if you will, a mother ship, that's the name they use, a larger ship that obviously had been by roughed, they put small skiffs on board these ships. They go out. Thousands, hundreds of miles out to sea and start attacking commercial shipping. You know, once you get the potential snicker factor of how silly can pirates be to take on the U.S. Navy.

This is a serious security, of course, and economic issue. Millions, billions of dollars of cargo go through these waters every year, and the Navies of the world really do want to get a handle on this pirate activity.

BLITZER: Now, these must be the most stupid pirates ever to try to take on, go after a U.S. warship?

STARR: Well, how can one politely say that, but yes, it's not the brightest thing in the world. Pirates have tried this before. The good news for these pirates is they were taken into custody and no one was killed. The U.S. Navy has sunk pirate ships before when they have come after them, U.S. warships do not tolerate any - any type - of activity.

BLITZER: You said they've taken them into custody. What do they do with them?

STARR: Well, you know, this is the challenge out there, they take them into custody and look for a third country that will put them on trial, but an awful lot of these pirates, Somalis, wind right back in Somalia and go out and try this again. So, it's a real challenge to get a handle on this.

BLITZER: These pirates are lucky they are alive right now.

STARR: Indeed.

BLITZER: All right. Thanks very much, Barbara.

There is new controversy right now over those full-body imaging machines that the government plans to put in airports across the United States. Some critics say they are causing legal problems for people who pose no security threat at all. Let's go to our Homeland Security correspondent, Jeanne Meserve. She's investigating this story for us. What is going on here, Jeanne?

JEANNE MESERVE, CNN HOMELAND SECURITY CORRESPONDENT: Well, you know, Wolf, those full-body imaging machines are being employed around the country to detect hidden explosives. They haven't done that to date, but they are finding much more.


MESERVE (voice-over): Cocaine found on a passenger at the Indianapolis Airport. Marijuana at a pipe similarly concealed uncovered in Las Vegas. The TSA says over the past year, more than 60 prohibited or illegal items have been discovered through use of full- body scanners like this, at U.S. airports.


MESERVE: Acting TSA administrator, Gale Rossides, uses this simulation to show how imaging has uncovered concealed knives, razor blades and bottles of liquids, all prohibited from aircraft.

ROSSIDES: It is an excellent piece of technology that will significantly improve our detection capabilities.

MESERVE: But not every item the machine reveals poses a security threat.

ROSSIDES: I have a very small baggy that is a replica of some drugs that we found concealed in a sensitive part of a passenger's body.

JOHN PERRY BARLOW, ACTIVIST: I can't imagine an explosive that is powerful enough in that quantity to endanger an aircraft. That's inconceivable to me.

MESERVE: John Perry Barlow, a one-time lyricist for the "Grateful Dead" was arrested in 2003 after the TSA found a small quantity of drugs during a search of his checked bag. He took them to court, saying the agency's mandate is to look for threats to airplanes, not drugs. He makes the same argument when it comes to body imaging machines.

BARLOW: They're not there to be part of the DEA. They're not there to be part of local law enforcement. They're there to keep the public safe.


MESERVE: Now Gale Rossides says her agency not looking for drugs, it is looking for threats. But if it finds drugs, it will turn the matter over to local law enforcement. The TSA plans to deploy 1,000 imagers by the end of 2011, each with a price tag of $130,000 or more.

BLITZER: And they have full confidence in these machines that they're going to really strengthen security around the country at these airports?

MESERVE: Yes. I mean, they aren't saying it's the be all and end-all and it is going to catch absolutely everything, but it's one of those layers of security. And they say, look it, if we're finding these tiny packets of drugs, it's an indication of how good the machines are and how good the operators that are using them.

BLITZER: Jeanne Meserve reporting for us, thank you.

Jack Cafferty is coming up next with "The Cafferty File."

Then, the battle may be over, but the health care reform war rages on. Leading up to the midterm elections in November. We're going to hear President Obama's latest challenge to the Republicans.

Also, the inside story of the Wall Street collapse. Who actually saw it coming? Who let it happen? Where are they now? I'll ask Michael Lewis, he's the best-selling author of the brand-new book "The Big Short." And you can't get your hands on Apple's new iPad until Saturday. But we have one right here in "The Situation Room." This hour, we're going to take it for a test drive. Show you the good, the bad, and the ugly.


BLITZER: Let's go back to Jack Cafferty. He's here with the "Cafferty File." Jack?

JACK CAFFERTY, CNN ANCHOR: The Democrats may have won the year- long battle over health care reform, but there are signs now that that may not translate into victory for them come November. In fact, just the opposite. Several new polls out suggest that Democrats could be in trouble in the midterm elections.

For starters, a CNN-Opinion Research Corporation poll shows that after the passage of health care, 55 percent of Republicans say they are extremely or very enthusiastic about voting in November. Only 36 percent of Democrats say the same thing. Although the numbers are up for both parties, the Democrats still face a double-digit so-called enthusiasm gap.

The poll also shows 48 percent of voters favor Republicans in their congressional district, compared to 45 percent for Democrats. Add in the fact that Republicans usually vote in higher rates than Democrats, and you can see possible big trouble developing for the Democrats in November.

To make matters worse, more than half of the independents say they would back the Republican candidate. About the only silver lining in all this for the Democrats is a lot of these people say they could still change their minds.

Meanwhile, a new "USA Today" Gallup poll shows Americans worried about unemployment and the economy are increasingly blaming President Obama. The poll shows half of those surveyed say that Mr. Obama does not deserve to be re-elected, and he fails to get a majority approval rating on his handling of these four issues - the economy, foreign affairs, the deficit, or health care.

So, here's the question: How will health care reform affect your vote in the midterm elections? Go to Post a comment on my blog.

BLITZER: Good question, Jack. Thank you.

President Obama says he's ready to carry on the health care reform battle this November, and he's challenging Republicans to try to repeal the new law. Listen to what the fired-up president told a crowd earlier today in Maine.


BARACK OBAMA, PRESIDENT OF THE UNITED STATES: This is what everybody's been hollering about. As the end of freedom. And now that it's passed, they're already promising we're going to repeal it. They're going to run on a platform of repeal in November. And my attitude is, go for it. You try to repeal it.

If they want to have a fight, I welcome that fight, because I don't believe the American people are going to put the insurance industry back in the driver's seat. I'm happy to have that argument. I'm happy to have that argument.

Now, in fairness, and I want to be scrupulously fair, some of them have now said, well, we want to repeal and replace this bill with our brand of insurance reform, but when you poke and prod and you ask them, well, what is it exactly you're going to replace it with? It turns out they want to deregulate the insurance market. We've already been there. We know what that's like. We're not going back. We're not going backwards. This country's ready to move forwards.


BLITZER: All right. Let's talk about this with CNN's John King, he's the host of "John King, USA," it comes up immediately following "The Situation Room," and our senior political correspondent, Candy Crowley. She hosts "State of the Union," which airs every Sunday morning at 9:00 a.m. right here no CNN. 9:00 a.m. Eastern, I should say.

John, it sounds like this president, he's not reluctant to go out there and start campaigning leading up to the midterm elections on this health care reform law.

JOHN KING, CNN ANCHOR: He's not reluctant, but he would have no choice, even if he were reluctant. This is a big issue in the campaign. Right now, the Republicans are trying to turn it into a bigger issue. So the president is out there, number one, defending his plan and his ideas. Number two, showing Democrats I'll be there today, I'll be there tomorrow and I'll be there the seven months throughout November.

And let's have this fight. Let's try to frame it our way, that we're going to take away kicking people off or denying them coverage for pre-existing conditions. He was trying to say today this will help small businesses, Republicans are saying just the contrary. There's a big policy argument here, Wolf, that is at the root of a giant political fight, and the president is trying to say the public may be divided right now, but I'm willing to fight it out through November.

BLITZER: A lot of the pros and cons of this health care reform law don't come into play for a few years. How does it play out leading up to November?

CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT: First of all, why you see the president talking about the things that will begin to take place immediately rather than the things that won't come into play until 2014, for instance, these insurance exchanges. I mean the whole idea of getting people who are uninsured and getting small businesses another way to cover their employees, that doesn't happen until 2014.

So listen, one of the things they know at the White House is that while health care reform is always important and while it's an important issue, the Republicans will use it as part of a broader issue and that is the whole "big government takeover" charge.

What the Obama administration believes is that this will be on the economy, and they believe if they can get people to feel as though the economy is getting better - and they do - if they can transmit that message, that's if not the winning message, that at least mitigates some of the losses.

So, I think you will see him more and more talk about the economy, and try to get people into the feeling that, yes, not only is health care going to help you in the future, but the economy's getting better. So, they're trying to create a feeling more than argue a fact.

BLITZER: Well, if they get some good numbers tomorrow morning, if there's a significant improvement in the jobless number, in other words, if they started to create 100,000 or 200,000 jobs in March, that would give a positive feeling to a bunch of folks out there.

KING: It would be a down payment. The economy would have to create somewhere in the ballpark of 300,000 jobs a month for the rate to start dropping significantly. They don't expect that quite yet. But if you look at our new polling, Wolf, roughly 80 percent of the American people believe the economy is in rough shape. I think it's 79 percent in the latest poll, that the economy is faring poorly.

That's exactly the same number as August, six, seven months ago. So the American people feel like they're treading water. And the president needs more positive data. He needs it now, next month and next month. Most people will tell you the psychology of an election year will be set pretty much by late summer, by labor day. So the President needs the next few months to be positive so that he can start to tell people, "I know it's tough but it's getting better."

BLITZER: And that old question, are you better off now than you were two years ago or four years ago, that affects a lot of voters.

CROWLEY: It absolutely does. And it also affects them to say here's where you might have been, we brought you back from the precipice. We've heard this sort of rhetoric from the president before, but if he can have something that says to people, our economy has started to grow.

I know that unemployment has been a lagging indicator, but it's getting better. Because, remember, now at 9.7 percent, 9.4 percent, over nine percent of people are unemployed. But that means 90 percent, 91 percent of people still do have a job, and so if you go with them and say it's getting better, hang on. That's what they believe will work.

BLITZER: Why did he go to Maine today? Two senators from Maine, both moderate Republicans, both of them voted against the health care reform bill, Olympia Snowe and Susan Collins, why Maine?

KING: There are a number of reasons. One is pure politics, in a sense that he's raising money for the Democrats in Boston tonight by having a policy event in Maine, the taxpayers pick up part of the price of the trip, not just the Democratic party.

But there are other reasons too. You mentioned those two Republican senators, Olympia Snowe and Susan Collins, they voted no on health care. The President wants to go to their state, a lot of independent voters, try to prove to them that he's still popular, that he still has some juice.

Because there are more issues about to come down the pike, and he could like to show the American people that not everything is going to be this partisan divide like health care was, so it's putting a little pressure on them, said nice things about them, essentially trying to say let's let bygones be bygones if we can't get along in health care maybe there is something else. Independent voters, a lot of them in Maine. They matter in this tier.

BLITZER: Take a look at these pictures. We're just getting them in. The President after leaving Maine, went down in Massachusetts, outside of Boston to meet with the governor, Deval Patrick, and there you see him over there getting a briefing on this really bad flooding that's hit not only Massachusetts, but Rhode Island and huge parts of New England right now.

This is an opportunity for the president, Candy, to show that he cares, he's made a detour. This was unannounced. He's showing, you know, his empathy with the folks who are suffering.

CROWLEY: Yes, he's in touch with those people. It's probably more valuable for Patrick Deval.

BLITZER: Deval Patrick.

CROWLEY: Deval Patrick, I'm sorry, who really is having a tough time in his elections. So, anything to kind of be the governor, you know, and I'm on top of this, is a good thing for him, probably better for him than the president.

BLITZER: How much trouble is Deval Patrick in?

KING: He's had a very, very tough race because of the economy, because of some frustration with state government. There was a point early on where many Democrats was saying, "please don't run, we'll get somebody else." But he's in this race, to the point there are six King siblings who live in that state and I can tell you, Wolf, from their reporting. This flooding, a lot of my friends say, wow, they've never seen anything like this in their lifetime.

BLITZER: You went to school in Rhode Island. So you know Rhode Island, you know Massachusetts, and it's a bad situation up there and the president stopped by to offer some support. Guys, thanks very much. We'll see you at the top of the hour, "John King, USA."

KING: I'll be there.

BLITZER: We'll see you Sunday morning, Candy Crowley.

It's the greatest financial crisis the U.S. has seen since the Great Depression, but how did it happen?


MICHAEL LEWIS, AUTHOR: At the bottom of it, it's a story about human perception and how people are -they see what they're paid to see.


BLITZER: That's Michael Lewis. He's written a brand-new, compelling book that takes us inside what he cause the doomsday machine. We'll get his take on the Wall Street collapse. Stand by for that.

And a new twist in the case of a TV host sentenced to be beheaded - yes, beheaded - for sorcery.


BLITZER: Lisa Sylvester's monitoring some of the other top stories from around the world. Lisa, what's going on?


Well, an update now, this is story we've been covering here in "THE SITUATION ROOM." The lawyer for the Lebanese man sentenced to be beheaded in Saudi Arabia tomorrow for sorcery says he has received a stay of execution. But there's no indication if his death sentence has been commuted or if he will be released. Ali Hussain Sibat used to make predictions and give advice to callers on Lebanese TV, but religious police arrested him during an Islamic pilgrimage to Saudi Arabia in 2008.

Talk about fire and ice. Amazing pictures. This was the magnificent sight for volcano watchers in Iceland today. A new crack has opened on a glacial volcano that began erupting in late March. Scientists don't believe that this lava flow poses a threat to local residents, but they are concerned that the it could trigger a more dangerous volcano nearby. Amazing pictures.

And here is an April Fools' joke that has everyone smiling in Istanbul, Turkey, thousands of pink balloons with happy faces came showering down on locals and tourists today. At the end, musicians also marched up and down the street. Organizers say that they did it - hey, they did it to cheer everyone up, and that it took all night to blow up 14,000 balloons. Who gets to clean all that up, though, Wolf? That's what I want to know.

BLITZER: I didn't know they did April Fools in Istanbul, Turkey, it's nice to see they have a sense of humor over there.

SYLVESTER: Yes, it puts a smile on people. It's always nice.

BLITZER: Thank you, very nice.

All right. Thank you, Lisa, don't go away.

He's taking on the people he says are behind Wall Street's recent collapse.


LEWIS: I think it's crazy to think that anybody's learned anything, because they haven't - they haven't suffered any consequences for their actions.


BLITZER: So, was it corruption? Was it greed? What was to blame? I'll speak with the best-selling author, Michael Lewis.

Also, it's a problem that plagued so many working mothers, where to pump breast milk at the office. But relief could be on the way.

And I'm getting a personal preview of a piece of technology that could revolutionize the way we use the web. The iPad is coming to "The Situation Room" this hour.


BLITZER: Tough economic times. Don't tell these guys on the front page of "The New York Times'" business section. Following a dismal year back in 2008, these hedge fund managers each - each - raked in a fortune last year, ranging from $825 million, to $4 billion in one year.

In fact, according to the industry magazine, "AR" the top 25 earning managers made a record $25.3 billion in 2009 alone. But even in the hedge fund world, they are the exceptions, not the rule. Many continue to struggle, along with the rest of the economy in the wake of the great recession.

And how we got to this point is the subject of a new book.

And joining us now, the best-selling author, Michael Lewis. His new book is entitled "The Big Short: Inside the Doomsday Machine," Michael, thanks very much for coming in. Thanks for writing this book.

LEWIS: Well, thanks for having me, Wolf.

BLITZER: Quickly tell our viewers what the doomsday machine is?

LEWIS: Well, it's a - it's the sub prime mortgage lending machine that in the end crashed Wall Street. And almost all of us at the same time. And in a story I'm telling is really about a handful of people who sort of diagnosed how the machine worked very early on, and made a whole bunch of money from it. BLITZER: They made money because they knew what was going on. It's a small number of people. So many others lost millions and billions and trillions, indeed, including a lot of lower-income, middle-class families. Was it a case of corruption or greed?

LEWIS: Well, greed is never very satisfying explanation for what goes on in Wall Street, because it's always there. And so, really, it's a question of how it's channeled. And the financial, the rules of the road in the financial system, have gotten so screwed up, that it's channeled into doing both idiotic and corrupt things.

I mean, it's a little hard to know where the stupidity ended and the corruption started. But there were elements of corruption and big elements of stupidity. I'd argue that just generally it wasn't widespread crime that led to this disaster, that it was closer to mass delusion and that it's going to be very unsatisfying trying to criminalize the behavior. What really needs to happen is Wall Street needs to be dramatically reformed.

BLITZER: You write an amazing story of a relatively small number of people who saw this, who understood what was going on, and they went on to make millions of dollars. And here's the question - why couldn't others see this? Why did only a small number of people see what was this bust was going to lead to this?

LEWIS: Well, this is the question. And I think because you've essentially got the financial system organized itself around this giant bet, and 99 percent of the system bet on the sub prime mortgage bond market, and a small handful of investors bet against it, and understood it - what was happening while it was happening.

And I think at the bottom of it, it's a story about human perception and how people are - they see what they're paid to see. And - and Wall Street, the big Wall Street firms, got themselves twisted into this knot where they weren't paid to see simple facts in front of their nose. I mean, the great, their sort of punch line to the whole crisis is that the people who were instrumental in disguising the risk of the sub prime mortgage market, the people at the big Wall Street firms, ended up owning a lot of that risk, and so they ended up fooling themselves.

BLITZER: But some of them have now emerged, still with a boatload full of money despite the fact that they were responsible for those disaster.

LEWIS: You know, this is the amazing thing, is it didn't matter which side of the bet you were on. You still got rich, even when you were wrong. And now, well, the problem is in some way worse. I mean, I would argue that the Wall Street firms got themselves into trouble in part because the traders were essentially playing with other people's money, and the other people being their shareholders.

But now they're playing not just with shareholder money but effectively with taxpayer money, and that creates an incentive to take risks that really shouldn't be taken. And -- and that's -- and they're paying themselves very well for taking these risks right now, even though -- in effect, what's happening is money's being gifted to the big Wall Street firms by the federal government.

BLITZER: Should people have gone to jail because of this?

LEWIS: I am sure people will go to jail. But the problem -- you missed the point, I think, if you think, Oh, we -- if we just put the bad people in jail, everything would be OK because I think the vast majority of the insane behavior was perfectly legal. I mean, that's what's frightening.

BLITZER: Perfectly legal?

LEWIS: (INAUDIBLE) the laws need to be -- the laws need to be changed. So it should be against the law for Wall Street firms to pay ratings agencies to rate the bonds they create. It should be -- it should be against the law -- it should be against the rules of finance in order -- to be able to create massive amounts of insurance on securities that isn't regulated like insurance. I mean, there are lots of things that just were -- the rules got twisted.

BLITZER: So you're basically saying we need more government intervention, more government regulation, and a whole new set of laws.

LEWIS: It's -- it's -- probably, in the end, it is more government regulation, but it's different sorts of government regulation. I sort of thing that regulators of the financial system will never be able to regulate it if the rules encourage really insane behavior as they do because, essentially, look, these people on Wall Street make, you know, multiples of what regulators make. They end up -- they end up capturing the regulators.

And so the only way the system works is if the rules -- if the incentives in the financial system make sense. And so it's crazy -- it's crazy, for example, that a Wall Street trader can make tens of millions of dollars for himself even while he is losing billions of dollars for his firm. But that happened at several firms.

BLITZER: Here's the bottom line question, I guess, from my perspective. Has Wall Street learned its lesson? Or to phrase it another way, could this disaster happen again?

LEWIS: Well, it depends on what you mean by "the lesson." But if the lesson is, Did they learn not to buy, you know, $50 billion of subprime backed mortgage bonds with lots of leverage? Yes, they probably learned that narrow lesson. But more broadly, no. I mean, look, it just -- if you back away from it, it seems to me that if you're working at a Wall Street firm, you've merely been encouraged by all of this. You're still doing very well for yourself. So I don't think -- I don't think -- I think it's crazy to think that anybody's learned anything because they haven't -- they haven't suffered any consequences for their actions.

BLITZER: That's a pretty depressing thought, when you think about that.

LEWIS: Well, but on the other hand, it creates an environment where reform might happen. BLITZER: Well, that would be more encouraging, I suspect. A lot of people would like to make sure that they don't lose their 401(k)s, they don't see their lifetime savings end up in half, or even worse.

LEWIS: Well, if they listen to Paul Volcker, they won't. I mean, you know, the administration has some pretty radical ideas, many coming from Volcker, and they make a lot of sense. And it's just a question of people being interested enough in the subject to push it down the throat of the legislature.

BLITZER: One final question on "The Blind Side." You're the author of that book. It became a major motion picture, nominated for an Academy Award, Best Picture. It did win an Academy Award for Sandra Bullock. How do you feel, as the author of a book like that, when you see it win all these awards on the big screen?

LEWIS: You know, when I first saw it, I probably had a quibble or two because it was my book, and you know, they changed this and that. But by about the time it got through, I don't know, say $200 million in domestic gross box office, I forgot I had any objections at all, you know? It was -- I felt like I'd written it myself. It's very -- look, it's a thrill to see a story that I thought was an important but very small story get played so big.

BLITZER: Did you get a piece of that box office or a lump sum?

LEWIS: Oh, you don't -- the writer never gets any piece of the box office.

BLITZER: That's what I suspected.

LEWIS: So what you get is -- what you get is recognition.



BLITZER: All right. Well, that's good enough, I guess, sometimes, although a little money wouldn't be too bad -- too bad, either. Michael Lewis, congratulations on writing "The Big Short: Inside the Doomsday Machine." It's a great read. We appreciate you joining us.

LEWIS: Thanks for having me, Wolf.

BLITZER: All right, it's already one of the hottest new pieces of technology ever, and it's not even available yet. We have it right here, our own personal preview of the iPad. Stay with us. We're going to show you what this is all about.


BLITZER: If there's one thing that Apple does better than inspiring a fierce loyalty among its fans, it's whipping up some mania over the arrival of a new product. This week, the buzz is all about the iPad, which goes on sale to the public on Saturday. Will it live up to all the hype?

Ed Baig writes about technology for "USA Today." He took the iPad for a test drive, and Ed is here to show us something about this new machine. That's what it is, a machine. But give our viewers a little sense of what this iPad can do.

ED BAIG, "USA TODAY": Well, anybody who has an iPhone is familiar with this form-factor, but not in this size. And the big screen makes all the difference in the world. Let me show you.

BLITZER: Yes, show our viewers the screen. We're going to come up right behind you.

BAIG: I'm going to just show a comic book. This is Marvel Comics. Look at the screen there.

BLITZER: Beautiful color.

BAIG: Beautiful color. Now let me show you something very different, the elements. We all learned the periodic table of elements in high school.


BAIG: Well, this is doing it on an iPad.

BLITZER: So you can just go in there and...


BAIG: ... go in there. There's hacion (ph). You remember hacion.

BLITZER: Of course..

BAIG: There's palladium.


BLITZER: ... but you know what? I'm interested in how it deals with, for example, movies.


BLITZER: You want to see a movie. You're on a plane, you're in a car, not driving, but you want to see a movie. What do you do?

BAIG: OK. Hit video.


BAIG: Happen to have a few movies already loaded in here. "Star Trek."

BLITZER: (INAUDIBLE) comes up. BAIG: We hit play, and there you go, you're watching "Star Trek." And like the iPhone, it has an accelerometer, so when you do this...


BLITZER: So there it is. And you can see that and you can hear it or you can plug in some headphones.

BAIG: Right. It does have a lone speaker, not stereo, but of course, you can plug in stereo speakers.

BLITZER: If you plug in the external speakers, you can have stereo.

BAIG: Absolutely.

BLITZER: All right. So let's say you want to read a book or a magazine.

BAIG: OK. Well, this is where the iPad is getting a lot of attention as a potential killer to the Kindle from Amazon, which, of course, is the leader in that still-burgeoning space. And I'm going to show you iBooks. They have a bookstore. But this is "Winnie the Pooh"...


BAIG: ... the children's classic, of course. And I'm going to turn it this way. And watch how you turn a page, just like a real book. That page goes...

BLITZER: And you're reading the book and you go to the top of the bottom and you can just turn the page.

BAIG: Or you can just tap and you're turning a page.

BLITZER: And you can read the book.

BAIG: And it has color, which the Kindle does not have.

BLITZER: Kindle is black and white, doesn't have that.

BAIG: Yes.

BLITZER: So they can have little diagrams or whatever in color.

BAIG: Exactly.

BLITZER: On book. How did it feel to you reading a book on this iPad as opposed to, let's say, a Kindle?

BAIG: Well, actually, while there's more sizzle here, and a lot of, you know, "Gee whiz" kinds of stuff, the Kindle is great because it's much lighter, 10.2 ounces versus a pound-and-a-half, and you'll feel that extra weight. So when I was curled up in bed, I actually found the experience a little bit heavy. You know, sometimes I hit that screen when I didn't want to and turned a page when I didn't want to.

BLITZER: And so what -- let's say you want to read a newspaper or a magazine, what do you do? Do you...

BAIG: Well, again, there will be apps for newspapers and magazines. We've got a "USA Today" app coming. You, of course, can look on the Web at all the media sites on the Web. And the Web looks absolutely gorgeous on here. Again, the big screen -- I keep coming back to it. The big screen makes all the difference in the world.

BLITZER: Bigger than an iPhone but not as big as a laptop.

BAIG: Correct.

BLITZER: Let's talk about, you know, if people want to -- you know, if people want to send some e-mail, is there a keypad? Is there -- you know, can they -- can they write?

BAIG: There's a virtual or what they call a soft keypad in here. You can connect through a dock an accessory for a physical keyboard.

BLITZER: Show me the keyboard.

BAIG: Sure. Let me bring up e-mail. And I want to send a new e-mail, so there you go. There's your virtual keyboard.

BLITZER: So then you can start typing...

BAIG: Start typing.

BLITZER: ... with one finger at a time, basically.

BAIG: One finger or two fingers.

BLITZER: So it's not like a regular...

BAIG: It's not like a regular keyboard. It's fine e-mail. It's fine for doing notes and short kinds of things. I wouldn't want to write my articles on this thing.

BLITZER: What does this do differently than the other -- you know, the laptops or the iPhones or the BlackBerries? What does this do differently?

BAIG: Well, I would say it's not so much what it does differently but how it does it. For one thing, you'll -- again, we just talked about the keyboard. There's no physical keyboard. There's no mouse here. Everything is done with your fingers. It's all multi-touch. Now, that is like the iPhone, but of course, this is the iPhone on steroids, a lot bigger screen. It's fabulous for games. It's fabulous, you saw, for movies. Pictures look wonderful. Let me show you what pictures look like here. Just tap.

BLITZER: You got all your pictures, but you can't take pictures with this.

BAIG: You can't take pictures with it. And that is one of the flaws in version 1.0. I would expect that somewhere down the road, they'll come up with a camera, a videocam. It would have been nice to do some video chats on here.

BLITZER: You can't print with it, either.

BAIG: You can't print with it, either, at least right now. Again, I think there'll be work-arounds for these things down the road. But right now, no, you can't.

BLITZER: But the battery life is pretty good.

BAIG: Battery life is very good. Apple says about 10 hours. I actually got a little bit better than that. So the battery life is very good. Not as good as the Kindle, which can go up to two weeks, but again, this does a lot more than the Kindle.

BLITZER: Is this for everyone?

BAIG: No, certainly not. And I don't mean to get across the message that the traditional laptop is going away. Of course, it's not going away. Again, there's the physical keyboard. There's the issue of storage. You can obviously hold a lot more on a laptop. And the other thing, of course, is if you're doing more advanced computing, video editing, say, you wouldn't do that on this.

BLITZER: You would do something else. But it will change. Is it fair to say it will revolutionize the way we deal with these kind of things?

BAIG: I think so. I mean, I -- the word "revolutionize" always is a little bit overhyped, but certainly, this has ground-breaking potential, and it has it in publishing and media, certainly games. This is a beautiful game machine. If I was Sony or Nintendo, I'd be worried.

BLITZER: This is what some people probably aren't familiar with. This is an actual newspaper. You notice that there's paper here, things like this. It's amazing. What will this do to this?

BAIG: Well, being a newspaper guy myself, I'm hoping this sticks around for a while longer. But this certainly represents the future. Now, whether it's this device or others like it remains to be seen. But I'd like to believe that the printed newspaper isn't going away so fast.

BLITZER: Yes. Well, you know, it's been in big trouble. I suspect this is going to make this thing even bigger -- in bigger trouble.

BAIG: Absolutely.

BLITZER: Ed, thanks very much for coming in. Good demonstration. BAIG: Thank you.

BLITZER: The Internet search engine Google is having some fun for April Fool's day. Find out why today it's going by the name Topeka.

And a rash of deadly gun violence breaks out on the streets of the nation's capital. You're going to find out who the police are now saying is responsible.

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


BLITZER: I want to go right to Lisa Sylvester. There's a story coming into the SITUATION ROOM. What are you learning, Lisa?

SYLVESTER: Wolf, we're just hearing that Scott Roeder -- he is the man who admitted to gunning down Dr. George Tiller -- that he has now been sentenced to life in prison without the possibility of parole for at least 50 years. This new development. We're going to continue tracking this story, and we'll bring the latest details as they come in.

And police in the nation's capital are pointing to possible neighborhood feuds and retaliation for street violence. In the past two weeks, three shootings left five people dead. Tuesday night, gunmen sprayed bullets on a crowd returning from a funeral, killing three people. Authorities have charged three suspects, including a 14-year-old boy, with first degree murder for that incident.

And here's a dubious honor for Newark, New Jersey. One considered one of the most dangerous cities, Newark passed the month of March without a single homicide. Now, it's a notable benchmark since Newark hasn't seen a murder-free month in 40 years. Credit is being given to Gary McCarthy (ph). He's the new head of the police department who took over, actually, in 2006. Last year, there were 77 homicides in Newark -- Wolf.

BLITZER: All right, good for Newark. Thank you, Lisa. Thank you very much.

Jack Cafferty is up next with your e-mail.

And a little known provision of health care reform with an impact on a lot of working mothers.


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

CAFFERTY: The question this hour is: How will health reform affect your vote in the mid-term elections come November?

Ray in Dallas writes: "Given the extreme measures taken by the Democrats to pass the bill in the face of prevailing public opinion, the situation leaves me very motivated to vote in November. I think the incumbent pro-"Obama care" members of Congress are in deep trouble across the board at this point, and I'm hardly alone in my motivation to work for and/or vote for an end of their terms."

Diane in Texas: "I wish Gallup would call me. Thank goodness the Democrats got the beginnings of health reform passed. I live in a heavily Republican-dominated area of Texas, but I'll do what I can to get the obstructionist GOP replaced by Democrats."

Joshua writes: "The Democrats will pay heavily for this one. I hope Nancy's ready to hand over that gavel she seems to like so much." Bob in Kansas City -- "It won't affect my vote. I'll do the ABC exercise, anybody but conservatives." Ken in Philadelphia -- "I'll looking to vote for more radical liberal Democrats. The current Congress failed to create a health care bill for all Americans. It's time for the unwashed masses to get rid of the privileged lackeys of the wealthy in this country. Vote them out. Incumbents beware."

Jane in Wisconsin says: "Health insurance reform will absolutely affect my vote come November. The arrogance of Democrats in pushing this mess through, despite the majority of the public being against it will play a big role in the way I vote. The idea that they would pass it first and then sell it later is absurd."

And Anne writes from South Carolina: "I live in South Carolina. The health care bill has nothing to do with wanting to get rid of our current Republican senator. I would vote for the Democratic candidate no matter how illiterate he was. I promise you, it would be an improvement."

There are only two senators in South Carolina. I wonder which one she's talking about. If you want to read more about this, go to my blog,

BLITZER: One's a Democrat, one's a Republican, right?


BLITZER: So I suspect I know which one she's talking about.

CAFFERTY: So you figured this out?

BLITZER: Yes. All right, Jack...

CAFFERTY: What's the name?

BLITZER: Not too complicated.


BLITZER: We'll talk tomorrow, Jack. Thank you.

CAFFERTY: Good-bye.

BLITZER: There's a part of the new health care reform law that you may not know about. It could affect millions and millions of nursing mothers. You're going to find out why some workplaces say it simply goes too far.


BLITZER: There is a provision in the new health care reform law which could spell relief for millions of nursing mothers who work. Lisa Sylvester is back with some details. What's this all about, Lisa?

SYLVESTER: Well, you know, Wolf, finding a private place to pump breast milk at the workplace -- this is an interest that women's groups have been fighting for years. Well, they found an advocate in the junior senator from Oregon, who got it done.


(voice-over): Tonya Hirte is a working mother of two who nursed both of her children. When she returned to her job as a retirement plan administrator after the birth of her daughter, she faced a major challenge, finding a place to pump breast milk at her workplace. If she was lucky, she used someone's office. Unlucky days, a public bathroom.

TONYA HIRTE, WORKING MOTHER: The only plug in the room was above the counter between the two sinks, facing this huge mirror. And so I would have to stand there pumping, pumping in a place that's public or that -- where strangers can come in and see you, you know, with your shirt off, and you know, pumping. It -- it was -- it's really hard. I mean, it's so hard to describe.

SYLVESTER: Tonya has since joined a group called Nursing Mothers Council of Oregon. The group helped lobby for changes. Now a requirement in the health care reform bill signed into law will make it easier on nursing moms in the future. The provision requires employers across the United States to provide a lactation room -- a private space other than a bathroom for women to pump milk for one year after the birth of a child. Employers will also have to provide workers with reasonable break time. Companies with fewer than 50 workers can ask for an exemption if the new rules create an undue hardship.

Oregon senator Jeff Merkley says his own wife, who was a nurse, had trouble finding privacy and flexibility when she went back to work. He inserted the language in the national health care legislation.

SEN. JEFF MERKLEY (D), OREGON: This is just one of those really common-sense approaches to health care. So often, we're focused on sick care, how to help people get well who are already sick. This is one of those investments that costs virtually nothing. It's a cultural change that has a huge impact on the health of our children, the health of our mothers. And so it's -- I guess it's something -- the time -- we should have done this 20 years ago.

SYLVESTER: Twenty-four states already have laws related to breast feeding in the workplace, according to the National Conference of State Legislatures, but at least one business group has come out opposed to the new federal mandate. The National Retail Federation say reasonable employers already accommodate workers without the need for federal standards, adding, quote, "Every additional mandated rule further burdens employers who are struggling to keep jobs afloat."


Now, the Labor Department will have to write out the regulations, define for example, what is a reasonable amount of break time and defining undue hardship. The new rules are expected to take effect in about six months -- Wolf.

BLITZER: Interesting story. Thank very much, Lisa, for bringing that to our viewers.

Remember, you can always follow what's going on behind the scenes here in the SITUATION ROOM. I'm on Twitter. You can get my tweets @Wolfblitzercnn. That's all one word.

I'm Wolf Blitzer in the SITUATION ROOM. "JOHN KING USA" starts right now.