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GOP Responds to Backtracking Charges; Pre-Emptive Strike on Military Budget; Ex-CIA Officer Arrested; Republicans Breaking Promises; Defense Department Trying to Get Spending Under Control; Financial Protection for Troops; Reading the Constitution

Aired January 6, 2011 - 17:00   ET

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


WOLF BLITZER, HOST: Happening now, the new House speaker responds to critics who say Republicans are already backtracking on their promises. On this the first full day of the new Congress, we are keeping score and holding both parties accountable.

Plus, President Obama says his new choice for White House chief of staff has government and politics in his DNA what will Bill Daley bring to the White House? "The Best Political Team on Television" has the inside track on the shakeup.

And millions of dead fish washing ashore to from Arkansas to the South Pacific and now, in Maryland, we are taking you to the scene of the latest kill and we are asking the experts if some kind of catastrophic convenient is simply going on.

I'm Wolf Blitzer, you're in THE SITUATION ROOM.

Just over 24 hours into his new stint as the speaker of the House, John Boehner is being called on the carpet over a laundry list of promises, the Republican leader insisting today he is going to make tough choices instead of avoiding them. But as our own Dana Bash said, wait a minute, that is not necessarily the full story.

Dana is joining us live from Capitol Hill with more.

Dana, you said that the Republicans are already seemingly backtracking on some of their promises and you had a chance to speak with the speaker about that today.

DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT: That's right, and his answer effectively, Wolf, was, on some of their promises, there are limits.

(BEGIN VIDEOTAPE)

BASH (voice-over): At his first news conference as House speaker, questions about why Republicans already appear to be violating some of their vows.

(on camera): Democrats are saying that there is hypocrisy going on here. It's not just them though, it's Tea Party activists. They're saying Republicans are already backtracking on their promises. REP. JOHN BOEHNER (R-OH), MAJORITY LEADER: Listen, I promised a more open process. I didn't promise that every single bill was going to be an open bill. Or -- as I said yesterday, we went through a whole Congress, two years without one -- without one open rule. And as I said yesterday, there will be many open rules in this Congress and just watch.

BASH (voice-over): The issue here, the way House Republicans are handling their first major legislation, repealing health care. House GOP leaders have repeatedly promised bills would not be written behind closed doors without committee hearings and that Democrats would be allowed to offer changes to bills on the House floor. Neither is happening with health care repeal.

REP. JAMES MCGOVERN (D), MASSACHUSETTS: It just strikes me as, you know, as unbelievable that after all we heard about openness and about full discussion that we are rushing this to the floor.

BASH: Another promise central in GOP campaigns, lowering the deficit, yet the Congressional Budget Office now says the House Republican plan to repeal health care would add $230 billion to the federal debt.

SEN. DICK DURBIN (D-IL), MAJORITY WHIP: They are living in the world of Dick Cheney and deficits don't count. We are back into that all over again.

BASH: Boehner brushed off the CBO report.

BOEHNER: I do not believe that repealing the job-killing health care law will increase the deficit.

BASH: Then there is the pledge to cut spending back to 2008 levels, which Republicans repeatedly promised would save at least $100 billion in the first year. Here's what Boehner told us in September.

BOEHNER: It's $100 billion in the first year. And if you look at it, we are talking about levels that many of us thought were to high then.

BASH: As House Republicans take power, aides are backtracking on $100 billion and say cuts will likely be half that, blaming the fiscal calendar, among other things.

Speaker Boehner avoided our question on the $10 billion figure, but said this --

BOEHNER: We will meet our commitment to the pledge in this calendar year. There's no ifs, ands or buts about it.

(END VIDEOTAPE)

BASH: Now House Republicans did keep a promise to, in their words, start cutting here at home, meaning in the House. They voted on a measure to cut the lawmakers' budgets by 5 percent. I want to put on the wall, though, what that cut means, it's probably better to call it a trim.

Cutting 5 percent or trimming 5 percent of a $3.5 trillion budget really is $35 million. That, as some budget experts will say, is less than a decimal point, it's .001 percent. But it does mean lawmakers are going to have to give back $75,000 in their own personal budgets. And Republicans we've talk to insist, look, every dollar counts when they are talking about cutting about spending. One GOP lawmaker said that he already did slash one position from his staff of 14.

BLITZER: On this bigger issue, millions of dollars obviously important, but billions a lot more important. Is the speaker still holding firm to that original commitment that he made to you and to everyone else that $100 billion would be cut in this first fiscal year?

BASH: He would not repeat that dollar figure. I asked him that question, he would not repeat the dollar figure, he simply said they would make a commitment to the bring down the levels of the spending that they had promised to.

But again, on that dollar figure, other Republicans are telling us it is probably not going to be that high. They give us various reasons for it about the fact that the fiscal calendar has changed, which sort of is a long, detailed story. They also say that the reason is because calculations have changed because they based that $100 billion figure on the president's budget, which he submitted last year, which was never put in.

But the bottom line is we are already hearing from people outside of Congress, the people who sent Republicans here that, you know, they don't want to hear about that math. They want to hear that Republicans are keeping their promises and very concerned that because they talked about the $100 billion so much, so many times, that they might not get there.

BLITZER: Dana is up on the Hill. Thank you, Dana.

A first today for the U.S. Congress and for the U.S. Constitution, members reading the document from the beginning to the end, right on the House floor. Speaker Boehner kicked things off.

(BEGIN VIDEO CLIP)

BOEHNER: We, the people of the United States, in order to form a more perfect union, establish justice, ensure domestic tranquility, provide for the common defense, promote the general welfare and secure the blessings of liberty to ourselves and our posterity, do ordain and establish this constitution for the United States of America.

(END VIDEO CLIP)

BLITZER: It took a series of lawmakers 84 minutes to read the entire Constitution. The minority leader, Nancy Pelosi, and some other Democrats joined in. Republicans billed the reading as long overdue tribute to America's founding principles. Critics, however, dismissed it as nothing more than a political stunt by the new GOP leadership.

Over at the White House today, President Obama officially broke the news he tapped former Commerce secretary Bill Daley to become his next chief of staff. Daley has a unique resume as an investment banking executive, now a former member of the Clinton cabinet and as part of Chicago's famous political dynasty.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Few Americans can boast the breadth of experience that Bill brings to this job. He served as a member of President Clinton's cabinet as Commerce secretary. He took on several other important duties over the years on behalf of our country. He has led major corporations. He possesses a deep understanding of how jobs are created and how to grow our economy. And needless to say, Bill also has a smidgen of awareness of how our system of government and politics works. You might say it is a genetic trait.

(END VIDEO CLIP)

BLITZER: Daley will fill the shoes of Rahm Emanuel who left the White House to run for mayor of Chicago.

The president says the acting chief of staff, Pete Rouse, will stay on as a senior adviser.

We are going to have much more on what Daley brings to the Obama administration after the midterm election trouncing and heading into the 2012 presidential race.

Let's get to an unfolding story that's happening right now. A former CIA officer in court in St. Louis today on charges he disclosed secret Defense information. Our homeland security correspondent, Jeanne Meserve, is standing by here with details.

What is going on here, Jeanne?

JEANNE MESERVE, CNN HOMELAND SECURITY CORRESPONDENT: Wolf, his name is Jeffrey Sterling, 43 years old, a former CIA officer. He was arrested today and charged with leaking classified information to a journalist. The information is described in the indictment as relating to a secret program designed to impede the weapons capability of an unnamed nation and a human asset assisting that program.

The journalist is identified only as "Author A" in the indictment, but there is every indication it is James Risen of "The New York Times" who wrote the 2006 book "State of War: The Secret History of the CIA" which discussed a CIA operation which used a Russian scientist to try to setback Iranian nuclear development.

Sterling was fired by the CIA in 2002. The indictment says his anger and resentment toward the CIA grew over time. He sued the agency for racial discrimination before and after his firing. He also clashed with the agency's publication review board over his memoirs. The indictment quotes verbatim from conversations and e-mails between Sterling and "Author A." An attorney for James Risen would not comment on whether with Sterling was one of Risen's confidential sources and says Risen has not provided testimony or documentation or cooperated in any way with the government's investigations into sources for his book.

Sterling, meanwhile, has been working in St. Louis as an insurance adjustor. According to our affiliate KMOV, he made his initial court appearance today in leg shackles and he will remain in jail because the court judged him to be a flight risk -- Wolf.

BLITZER: They only identified the journalist as "Author A," so why the suspicion of James Risen? Is there any specific information in the court papers why he might be suspected?

MESERVE: It mentions at one point that "Author A" wrote an article about Sterling. It mentions the date on which this article was published, and if you go back and search the archives of "The New York Times," you find that James Risen wrote an article about Sterling on that date. That is one of the indicators.

BLITZER: OK, all right. Jeanne, thanks very, very much.

A smoke spews from packages and the bomb squad rushes in. Were the incidents at two state government buildings related?

And U.S. officials are investigating reports that another American is being held in Iran on charges of spying.

And a preemptive strike by the Pentagon and its own budget. We're going to tell you which branch of the military may be hardest hit.

(COMMERCIAL BREAK)

BLITZER: Twenty-four hours into the new Congress, Jack Cafferty certainly keeping score of what's going on. He is here with "The Cafferty File" -- Jack.

JACK CAFFERTY, CNN CONTRIBUTOR: Well, it didn't take very long, did it? Republicans have officially been in control of the House of Representatives for one day and they are already backpedaling on some of the promises of transparency they made during the campaign.

For starters, Republicans promised all bills would go through a regular committee process. Not exactly. Wouldn't you know that the bill to repeal health care reform won't go through a single committee. Republicans say this is because the committees have not been formed yet and they want to move quickly. They also insist the repeal bill will be what they call a very straightforward document, whatever that means.

When the Democrats were in charge, you will recall, the Republicans complain they didn't allow unlimited amendments and debate on a single bill, so the Republicans promised a more open amendment process for bills. Not exactly. With a bill to repeal health care reform, there will be practically no amendments.

You have to give the Republicans some credit, though. It is not easy to break this many promises in a single day.

House Republicans said they wanted to publish committee attendance lists, you know, so the people who elect them could actually see who is showing up for work. Well, this one never had a chance. They claim that it wouldn't work since multiple committee hearings can happen at the same time.

And lastly, the Republicans had said they would include a constitutional justification with every bill. That's not happening either.

All of this comes after we learn that the estimate for how much the GOP would shave off the budget is now about half what it was in their "Pledge With America." So apparently that was a lie, too.

The more things change in Washington -- well, you know the rest.

Here is the question: What does it mean if House Republicans are breaking promises after just one day?

Go to CNN.com/CaffertyFile.

BLITZER: That committee issue, you know, I covered Congress for a long time. I can't tell you how many times --

CAFFERTY: You covered the first one, didn't you?

BLITZER: I covered -- yes. I went to a committee hearing and there are supposed to be 12 or 14 or 30 members, there was barely one sometimes. Sometimes there wasn't with even one member in a committee hearing, they would have a staffer asking the questions because nobody there showed up. It is a rather unusual situation.

CAFFERTY: So why would they promise to publish these lists of who's in attendance?

(CROSSTALK)

BLITZER: Well, they backed away from that. They were going to do that, but they didn't pass that rule, that's right. They quickly backed away from that one.

All right, Jack, thanks very much.

CAFFERTY: Sure.

BLITZER: Jack Cafferty, keeping them honest.

A one-two shot of fear today at a time went nation is on the heightened alert already fro package bombs. Flashes of smoke and fire set off alarms at two Maryland state office buildings. Brian Todd is following the developments from the state capital in Annapolis right now. Brian, what's going on here?

BRIAN TODD, CNN CORRESPONDENT: Well, Wolf, officials are telling us they cannot say definitely right now that these two incidents are linked, but they are saying they are very similar in nature.

The first incident occurred right near where I'm standing. We are literally at the foot of the state House, it's just a few yards away here in Annapolis, but the incident occurred here at the Jeffrey Building, which is a state housing building housing the State Department of Homeland Security, the secretary of state and people who work for the governor.

That incident occurred 12:25 p.m. Eastern time today. When an employee of the mailroom here opened a package, there was a burst of flame, a bit of flame, a little bit of smoke and a sulfuric smell. That person received some singeing in his fingers, but no further injury and he refused further medical treatment.

About 20 minutes later or so, a very similar incident happened a few miles north of here at the State Department of Transportation near Baltimore Washington International Airport. A similar injury to an employee there, again, not serious. Some people were taken to hospital just as precautions, but no serious injuries there.

Again, they're saying these incidents are not linked, but the fact that these two incendiary devices occurred within 20 minutes of each other, the packages, they say, were very similar, both of them looked like something would you receive a book in. We got a photograph of one of the packages earlier.

I was just told by a state police official that both packages did have postmarks, but this official did not want to say where they came from. They may not know or they may just not be saying at this particular time.

There is a third incident being investigated. That is at the State Department of Health and Mental Hygiene in Baltimore. We are told by state police that police and fire officials are on the scene as a precaution. That is all we can say about that incident at the moment.

So that is where we stand right now, Wolf, two very minor injuries and two incendiary devices that went off at very close proximity to each other in time and places not too far away from each other in Maryland state government mailrooms. The package that was opened up here was addressed to Governor Martin O'Malley, Wolf.

BLITZER: And I take it people, though, have been allowed to go back into those buildings to resume their work, is that right?

TODD: That's correct. As soon as these incidents occurred, they evacuated both buildings. There were about 50 people in this building behind me, there were about 250 people in the building near about the more, and they evacuated both of them immediately. In this building, about two hours later, they did allow people to come back in when they deemed the building to be safe and the incident was apparently contained.

What is interesting is I talked to a state legislator here not too long ago and he said the timing is interesting because there aren't that many people in these buildings right now, but a week from now when the state legislature is in session, there are a lot more people in this building. So maybe fortunate that it occurred now rather than a week from now.

BLITZER: Very quickly, Brian, I don't understand, if the packages were similar and the timing within 20 minutes of each other, why are the authorities rushing to say they don't see any connection?

TODD: Well, they're just not saying that right now. They're saying it is under investigation. They just can't say definitely that they're linked at the moment. It doesn't mean that they may not come out in the coming hours days and say that they're linked. I think they need do a little bit more forensics on it first and that is what they are doing now.

BLITZER: Yes, obviously. All right, Brian, thanks very much. We will stay on top of the story.

Reports from Iran that an American woman has been arrested for espionage, including allegations she had a listening device, get this, hidden in a very unusual place. We will have details.

And dramatic new developments in the case of two sisters expected to be released from a Mississippi prison if one donates a kidney to the other. They may be just hours from gaining their freedom. We will have the latest, right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: This just coming into THE SITUATION ROOM, a developing story out of Washington, D.C.'s Dulles Airport.

Lisa Sylvester is monitoring that, some of the other top stories in THE SITUATION ROOM.

What is happening at Washington Dulles?

LISA SYLVESTER, CNN CORRESPONDENT: The information that we are getting at this time is that approximately around 3:40 Eastern time at Dulles Airport, a K-9 sniffing dog apparently picked up a scent of some sort outside the baggage claim area in that general area. And so what they have now done is the east end of Dulles Airport, this impacts both the baggage claim area as well as with the ticketing area, they have now evacuated those areas. If you have a flight out on United Airlines, this could impact you. So this is a story that we are going to continue to monitor as more information comes in.

In other news, the NPR executive who ignited that controversy when she fired news analyst Juan Williams last October has resigned. Ellen Weiss fired Williams after he appeared on FOX News and made controversial comments about Muslims. Her resignation comes on the same day that NPR announced the results of an investigation into the incident and recommended updating its code of ethics.

The State Department is also looking into reports that an American woman is being detained in Iran on spying charges. An Iranian news agency is reporting that a 55-year-old woman was arrested trying to enter the country from Armenia illegally. She allegedly was in possession of, quote, "espionage devices such as a microphone implanted in her teeth." But some details are contradicted in other reports and a State Department spokesman says U.S. officials don't even know if she is, in fact, an American.

A case of mistaken identification may have helped spark that shootout at an Arizona mall. Authorities say U.S. Marshals confronted a man they thought was suspected of shooting at a police officer last month. When the man opened fire, it seemed to confirm their suspicions. He later surrendered to police after taking two hostages at a nearby restaurant. It was only then that police discovered he was not the man they were originally seeking.

And in just a matter of hours, it's just a matter of hours now before two sisters will be released from a Mississippi prison on the condition that one donates a kidney to the other. A Department of Corrections official says Governor Haley Barbour has officially suspended their sentences and the two will be released tomorrow morning. The sisters have spent 16 years in prison for armed robbery while three accomplices received lesser sentences and have since been released.

This is a story I know a lot of people were tracking and following, there was some question whether the sentences were fair in the first place. Now they're going to be released.

BLITZER: I hope that kidney operation is successful and it works for both of these sisters.

Thanks very, very much.

Before the new Congress might take a whack at the Defense budget, the Pentagon is now making some of the own proposed cuts, billions and billions of dollars. We are standing by for the details.

And the wife of a top U.S. General in Afghanistan is now put in charge of the second biggest concern to U.S. military members after dying in battle. She is going to tell us all about it.

And a new Mega Millionaire is revealed.

(COMMERCIAL BREAK)

BLITZER: You're in "THE SITUATION ROOM."

Happening now, the president taps a member of an old Chicago political family to serve as his new White House chief of staff. What does it signal about the direction of the White House's agenda? We will have in depth analysis, that's coming up.

And details and surveillance video from some of the last moments from the life of a former Pentagon employee. We're going to update you on the new twists and turns in this very mysterious murder case.

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

A new preemptive strike by the Pentagon is now underway. The target, the military's own budget. Defense officials are trying to get spending under control and one possible victim in the cuts, the troops themselves.

Our Pentagon correspondent, Barbara Starr is standing by to describe what's going on. Some are saying these are pretty substantial, these proposed cuts. What are you learning?

BARBARA STARR, CNN PENTAGON CORRESPONDENT: Well, Wolf, if Congress approves Secretary Gates' plan, there will be very significant cuts. The Pentagon not immune from trying to get the federal budget under control.

(BEGIN VIDEOTAPE)

STARR (voice-over): After 10 years of war, the Army and Marine Corps have new marching order, cut the ranks. The Marines plan to lose 10 percent of their force, the Army 5 percent. The deficit- conscious White House ordered the Pentagon to trim a total of $78 billion over five years and dramatically reshape spending across the military.

ROBERT GATES, DEFENSE SECRETARY: My hope and expectation is that as a result of these changes over time what had been a culture of endless money, where cost was rarely a consideration, will become a culture of savings and restraint.

STARR: Congress will have to approve much of Gates plan at a time when Capitol Hill deficit hawks are a growing force.

TINA JONAS, FORMER PENTAGON CHIEF FINANCIAL OFFICER: Essentially, the key thing that the secretary is facing is a divided Congress and an agenda that is clearly about reducing the overall spending for the government entirely.

REP. ADAM SMITH (D-WA), HOUSE ARMED SERVICES COMMITTEE: No one wants to cut Defense. No one wants to cut Social Security, Medicare or Medicaid. No one wants to raise taxes. No one wants to cut education or critical infrastructure. On the other hand, we have a $14 trillion debt.

STARR: Hardest hit may be the Marine Corps. Gates canceled the $12 billion new amphibious assault vehicle. And the troubled Marine Corps version of the F-35 fighter, if it can't be fixed, also canceled. A real flash point, making military retirees pay more for their health care. Right now, a retired military family of four pays about $460 a year for military health care, even as costs have skyrocketed.

GATES: For example, the fees for a comparable health insurance program for federal workers costs roughly $5,000 a year. TODD HARRISON, CENTER FOR STRATEGIC & BUDGETARY ASSESSMENTS: These military health care costs have grown to the point that they now consume some $51 billion a year in the defense budget, and it's near 10 percent of the base defense budget.

STARR: Gates wants to take $154 billion in proposed cost savings and put about half of it into new communications, intelligence, and electronic gear to deal with future threats from places like Somalia and Yemen.

(END VIDEOTAPE)

STARR: So, even as they are going to cut spending at the Pentagon, they are going to invest in trying to deal with new threats. Gates wants to start a significant new program, a new nuclear-capable bomber aircraft to deal with rising threats from places like China, North Korea and Russia -- Wolf.

BLITZER: Are they simply assuming, Barbara, that with all U.S. troops out of Iraq, for example, by the end of this year, and a significant reduction of U.S. troops in Afghanistan, the number, the billions and billions and billions of dollars spent every month in Iraq and Afghanistan, will dramatically go down?

STARR: Well, that will go down, but that is actually outside all of this. The winding down of the wars in Iraq and Afghanistan, or at least the hoped for winding down, is actually the reason Gates is making some of those cuts to the Marine Corps and the Army, even though he says that's the last place he really wanted to cut.

They are going to go ahead and do that. They're going to hope that they just don't need additional troops when there might be a new generation of threats out there -- Wolf.

BLITZER: Barbara, thanks very much.

Meanwhile, there is a new move by the Obama administration to protect military families from an enemy at home. We're talking about shady lenders.

A key position has now been filled in the new Consumer Financial Protection Bureau created by the Wall Street Reform bill which is now law.

Our national political correspondent, Jessica Yellin, is here. She is joining us with more.

Service members are about to get more protection. What's going on?

JESSICA YELLIN, CNN NATIONAL POLITICAL CORRESPONDENT: Wolf, I will give you a finding that surprised me.

When the military asked enlisted men and women, "What are the greatest causes of stress?" financial worries ranked second, higher than their worry about war and hostilities, higher than their worry about deployments. The only higher concern was overall career.

Now, administration officials say service members are disproportionately targeted by predatory lenders and identity thieves, and are at a special disadvantage during deployments. So they are setting this up office to help them avoid some financial predators out there.

BLITZER: And the person who is going to be the lead advocate in this office is?

YELLIN: Holly Petraeus, a familiar name. Yes, she is the wife of General David Petraeus.

She is going to be setting up what they call the Office for Servicemember Affairs inside the Consumer Financial Protection Bureau, and it's really in her wheelhouse. She is currently director of the Better Business Bureau's military line, where she is a consumer advocate for service members. And she says that financial abuse can be such a distraction to troops, that it even diminishes their readiness on the battlefield.

(BEGIN VIDEO CLIP)

HOLLY PETRAEUS, OFFICE OF SERVICEMEMBER AFFAIRS: The Department of Defense realized a number of years ago, and they had so many service members losing their clearances because their financial affairs were in such disarray. I know personally during the first deployment, we had soldiers from the 101st Airborne who had to be brought back from deployment because their accounts had been cleaned out while they were gone, they had identity theft and mismanagement issues. So it can affect their military readiness, and that is really not acceptable.

(END VIDEO CLIP)

YELLIN: And she says that, in fact, service members are often denied security clearance because they have such severe financial problems. It's the number one reason.

This office will write rules that prohibit unfair, deceptive practices, and they'll also just make sure that credit cards, loans, mortgages for service members, comply with existing regulations.

You saw her sitting there, Wolf, with Elizabeth Warren. She is the woman running this new Consumer Financial Protection Bureau which is designed to protect all of us from these kinds of traps.

BLITZER: And she's made the decision to bring in Holly Petraeus to run the military division of it.

YELLIN: That's right, yes. And I asked Holly Petraeus, "How does it feel joining the Obama administration?" She said, "I don't see this in a political way."

BLITZER: She sees it as doing the work to help military men and women. YELLIN: Right.

BLITZER: All right. Thanks very much for that.

Neighbors of a former Pentagon official are now speaking out about his death and how he turned up in a landfill. We're looking for clues in Jack Wheeler's back yard.

And political stunt or tribute to America's values? Stand by to hear what James Carville and Rich Galen have to say about the reading of the U.S. Constitution on the floor of the House.

(COMMERCIAL BREAK)

BLITZER: After an unexpected drop in new unemployment claims in late December, the latest numbers are now out.

Lisa Sylvester is here with some of that and some of the other top stories here in THE SITUATION ROOM, including whether or not there is a positive trend for job creation, negative trend.

What's the latest?

SYLVESTER: Overall, it's a positive trend, Wolf -- 409,000 Americans filed first-time jobless claims last week, which is about 18,000 more people than the week before. But despite the slight rise, economists say the overall improving trend in jobless claims is still intact. New jobless claims peaked at more than 650,000 in March, 2009, and there has been a general downward trend since August of last year.

Well, Jim and Carolyn McCullar, they are the newest members of America's super rich. You see them there, thanks to the Washington State lottery.

The couple from the town of Ephrata in eastern Washington, well, they won $190 million in the Mega Millions drawing this week. They are one of two winning ticket holders who is going to split that $380 million jackpot. The identity of the other winning ticket holder is not yet known. Good for them.

Well, it could be a windfall for investors in Facebook. "The Wall Street Journal" is reporting that the company could go public by April of 2012. The newspaper cites a company document that outlines plans to make an initial public offering or disclose financial information by that time.

So, all in all, Wolf, it could be a big payoff for the founders of Facebook.

BLITZER: Just what they needed, some more money. I mean, they're already worth billions and billions of dollars.

SYLVESTER: I know, billions on tops of billions. It's all gravy.

BLITZER: Did you see that movie?

SYLVESTER: I did. And I really --

BLITZER: It was a very good movie.

SYLVESTER: And it's really good insight into exactly how Facebook came about. Good movie.

BLITZER: All right. Thank you. I agree.

A key Democrat says his Party wants to get Nancy Pelosi her old job back. We'll discuss that strategy in today's "Strategy Session." Stand by.

And instead of reducing the number of troops in Afghanistan, the Obama administration is now preparing to add more troops to Afghanistan. I'll talk about that and more with Republican Senator Lindsey Graham of South Carolina, and we'll also discuss his proposal of putting permanent American military bases in Afghanistan.

(COMMERCIAL BREAK)

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

Joining us, the Democratic strategist and CNN political contributor, James Carville, and Republican strategist Rich Galen. Guys, thanks very much for coming in.

James, was it smart for the Republicans on this, the first full day of business in the new Congress, in the House, to formally spend, what, 85 minutes or so and read the U.S. Constitution?

JAMES CARVILLE, DEMOCRATIC STRATEGIST: Well, being that the Speaker and the Majority Leader both left to do a press conference, it turned out to be -- it was more like -- the Constitution is a great document, and what they did with it turned out to be kind of comical. There was nobody paying attention or listening. Even their own leadership didn't even pay any attention to it.

And, you know, it's not the end of days or anything, but they should have more respect for the Constitution than to do something like that.

BLITZER: Well, they did get some Democratic leaders to participate in reading clauses and articles and all sorts of stuff, as well including Nancy Pelosi, Rich.

RICH GALEN, REPUBLICAN STRATEGIST: Yes. Well, I disagree with James here.

I think that it was a nice thing to do. I think it's a good precedent to start.

I don't think there is anything wrong with, once every two years, spending an hour and a half of reading the Constitution. They did things like had Mr. Lewis of Georgia read the 13th Amendment which abolished slavery. Mr. Lewis, being one of the heroes of the civil rights movement.

I think it was much more than a joke. I think it was well done, both sides participated.

CARVILLE: Well, why didn't the Speaker and the Majority Leader sit and listen to it?

GALEN: Well, if --

(CROSSTALK)

CARVILLE: If you look at the chamber, it was entirely empty.

GALEN: Well, the minority didn't hang around either. But they were there for the time that they were supposed to be there, the people at home got to hear it.

And I'll tell you something else. I will bet that you for most of these members, that is the first time they have either heard or read the entire Constitution since social studies in high school.

CARVILLE: Rich, they were at a press conference.

GALEN: He was there to -- Wolf just played the clip of Boehner.

CARVILLE: He was at a press conference.

GALEN: Oh, stop it, James.

CARVILLE: He was at a press conference.

BLITZER: He was there at the beginning when he was reading that little section at the beginning.

CARVILLE: OK

(CROSSTALK)

GALEN: There are not enough straws in Washington for you guys to keep grasping at these. It was a good thing to do.

CARVILLE: I'm in New Orleans, man. I'm in New Orleans.

GALEN: It was done well. Well, there are not enough straws in New Orleans then for you guys to keep grasping at this.

It was a nice thing to do. It was well handled. The minority participated. It was a good thing to, and I think they ought to do it every two years.

BLITZER: All right.

CARVILLE: You think anybody at home watched this?

GALEN: Oh, sure, the people that watched -- I guarantee you that people who watch C-SPAN stayed for every word of it. You bet. BLITZER: All right. Let's move on to another --

CARVILLE: Unfortunately, the Speaker of the House didn't stay.

BLITZER: -- issue involving the former Speaker, Nancy Pelosi.

James, let me start with you.

The chairman of the Democratic Congressional Committee, which is in charge of getting Democrats elected, re-elected to the House of Representatives, Steve Israel of New York, he says their goal is to make sure that Nancy Pelosi, after the elections in 2012, comes back as the next Speaker of the House. That would mean the Democrats capturing 25 seats in the 2012 elections.

Is that smart though, politically, to say out there, you know what? Our goal is that Nancy Pelosi comes back as the Speaker, given the divisive nature that she has had at least for a lot of Americans out there?

CARVILLE: Well, let's see where it is in 2012. And she is very popular in the Democratic Caucus. She's very popular with me. I'm personally very crazy about her.

I think she's ethically and morally one of the people I think people can really look up to. I don't -- I'm not sure anybody checked with former Speaker Pelosi, I'm not sure in 2012 she would be all that anxious to come back as Speaker, but somebody could ask her.

(CROSSTALK)

GALEN: Nineteen members of her own caucus didn't even want her as Majority Leader.

CARVILLE: Well, you know, we're Democrats. We're not told what to believe. At least she wasn't having a fund-raiser when she took the oath.

GALEN: We know this.

BLITZER: What do you think as a Republican, Rich, that if the Democrats say, you know what, if we get the majority again, she is going to be Speaker again? Is that a smart political strategy?

GALEN: No. I mean, I don't think so.

I mean, I think, you know, what the Democrats ought to be doing is looking for some new faces that they can trot out as the new face of the Republican -- of the Democratic Party rather than Nancy Pelosi, who, for us, was a lightning rod.

BLITZER: Who are some of those new faces? Who do you think some of those new faces are?

GALEN: Oh, I have no idea. I'm sure there's some young folks that have been there for -- we know there's only nine freshmen, so it's not going to be one of them. But I'll be there are some folks that have been -- Chris Van Hollen from Maryland that ran the D Triple C. He's a terrific guy. I think he could be a break great spokesman for the party.

BLITZER: Do you see any new faces out there, James, that you like on the Democratic side of the House, who potentially could be a Speaker?

CARVILLE: You know, you've got -- again, he points out that Chris Van Hollen is -- you know, a lot of them got out, new ones have come in. The next Speaker probably will be somebody -- John Boehner's hardly a new face, if you want to talk about new faces. I mean, to be Speaker, you have to be around for a while.

(CROSSTALK)

GALEN: Well, and Chris is. Chris was in the leadership. So he, I think, fits the mold. You're exactly right, James. You can't just be there and hop in as Speaker.

CARVILLE: Yes. Nine freshman, and the next Speaker is not going to come out the first (INAUDIBLE) -- and I understand what you were saying. I actually kind of agree with your point. But, you know, this was a tough cycle here for Democrats, so --.

GALEN: And you know that Gallup data today, James, where it showed that -- what is it, 31 percent of Americans identified themselves as Democrats, 29 as Republicans? That shows that both sides I think have some work to do. Don't you?

CARVILLE: I agree. And I think confidence for political parties is down. There's no doubt about that.

That's what protracted unemployment produces (ph). This kind of data is not surprising. And you will see what happens here, but it -- unfortunately, you know, the way things are getting off to a start, it might continue to go down.

BLITZER: Two years is a long time in politics. We saw the change from 2008 to 2010. We can see a huge change potentially in 2012 as well, as we all know.

Guys, thank you very, very much.

CARVILLE: Thank you.

BLITZER: This important programming note for our viewers. The new House Minority Leader, Nancy Pelosi, will be a special guest on "JOHN KING USA." That airs tonight at 7:00 p.m. Eastern, right after THE SITUATION ROOM.

Jack Cafferty is asking, what does it mean if House Republicans are breaking promises after only one day?

And Christians targeted for attacks in Muslim nations. Are the pope's worst fears coming true? (COMMERCIAL BREAK)

BLITZER: Let's go right to Jack. He's got "The Cafferty File" -- Jack.

CAFFERTY: The question this hour is: What does it mean if the House Republicans are breaking promises after only a single day in the charge?

Jay says: "It means they're not even trying anymore to hide their agenda. This is real transparency. Hey, voters, we'll sell you whatever bag of lies we think you'll buy around election time, and then we'll get right to work doing what we feel like regardless of what we promised you. At least you have to admire their fortitude."

Lance in California writes: "Give me a break, Jack. How many amendments germane to the repeal of Obamacare do you think are needed? The repeal is two pages long, it's been on the Web since Tuesday. The vote is next Thursday."

"Open up debate on amendments, the bill will languish in the House until hell freezes over. Let's get this vote done so the public can see who says yes and who says no."

Richard in Kansas says: "It means -- to quote former Arizona Cardinals coach Dennis Green -- "'they are who we thought they were.'"

James in San Diego, "It means the Tea Party voters are shown to be the fools, dupes or idiots that we on the professional left knew they were. Business as usual for the GOP."

Ralph in Texas: "It means our House is not in order. And no matter how big the gavel, promises unravel."

That sounds like it could have been written by Jesse Jackson.

Jeff in California writes: "Most Americans don't seem to have very long attention spans, so promises are fairly meaningless anyway."

Ben in Maryland: "Shocking, Jack. Shocking. I suppose you also believe everything your used car salesman told you right before you bought that Edsel."

And Dick writes: "I think this means 'The Cafferty File' should have enough ammunition to go back to three questions a day."

Not a chance.

If you want to read more on this, you can go to my blog, CNN.com/CaffertyFile. Read the e-mails too. Two questions a day.

BLITZER: They love "The Cafferty File," Jack, as they should. Right?

CAFFERTY: Well, it's wintertime. They're shut in. It's cold outside.

(LAUGHTER)

BLITZER: They learn something. Thanks very much.

New fears that Christians are fleeing Muslim nations now in droves after a series of deadly attacks including a suicide bombing on New Year's Eve. New information coming in.

And millions -- yes, millions and millions of dead fish, they're washing ashore around the world. The latest kill in Maryland. Is this a coincidence or is there something catastrophic going on?

(COMMERCIAL BREAK)

BLITZER: In Egypt, supporters of a Christian group are rallying in the wake of a New Year's Eve church bombing that killed 23 people. Pope Benedict is speaking out about that and about all of these spate of attacks against Christians in Muslims nations in recent weeks.

Our foreign affairs correspondent, Jill Dougherty, is following this story for us.

Jill, the pope is concerned that these attacks could have a very, very serious consequence on Christians living in the Muslim world.

JILL DOUGHERTY, CNN FOREIGN AFFAIRS CORRESPONDENT: Right, Wolf.

You know, he is calling the situation "intolerable," these attacks on Christians in predominantly Muslim countries. Many of those Christians are fleeing. In fact, in Iraq, for example, only four percent of the population is Christian, but Christians comprise nearly 40 percent of all Iraqi refugees. And the pope says he fears there's going to be an exodus of Christians from that region.

(BEGIN VIDEOTAPE)

DOUGHERTY (voice-over): In Alexandria, Egypt, a deadly start to the new year.

HANI BOTROS, ALEXANDRIA RESIDENT: I found bodies, big bodies, and one of the people crying.

DOUGHERTY: As Coptic Christians leave mass, a suspected suicide bomber kills at least 21 worshippers, wounding 43, the worst attack on Egyptian Christians in a decade.

Egypt, Iraq, Nigeria, the Philippines -- attacks on Christians by radical Muslims are spreading. And Pope Benedict XVI, in his New Year's Day homily, says, "Humanity cannot be allowed to become accustomed to discrimination, injustice and religious intolerance, which today strike Christians in a particular way." The pope says today, Christians are the most persecuted religious group in the world.

In the Egypt attack, and in an October attack on a Caldeon (ph) Catholic church in Baghdad, Iraq, in which at least 70 people died, terrorism analysts point to al Qaeda affiliates bent on avenging two Christian women who allegedly want to convert to Islam. But a religious freedom expert says it's much more complicated.

PAUL MARSHALL, HUDSON INSTITUTE FELLOW: Both things are going on, an increase in radical sentiment throughout a lot of the Muslim world which is leading to attacks on Christians and others, and now this second level where al Qaeda in particular countries -- maybe it will expand -- is making Christians the specific target.

DOUGHERTY: Egypt's president says his country is shocked and will investigate.

The State Department it's very concerned by the attacks.

P.J. CROWLEY, STATE DEPT. SPOKESMAN: Clearly, there are pressures on minority groups in these countries, and we would hope and expect that, you know, in those respective governments, you know, we'll fully investigate these attacks and bring those responsible to justice.

DOUGHERTY: But Paul Marshall says there's a climate of impunity in several majority Muslim countries.

MARSHALL: When Christians are attacked, when they're killed, there is no punishment. And there's often no arrests. The police say they don't know who did it. Or if they're arrested, they're let go, or if there's a trial, it drags on.

(END VIDEOTAPE)

DOUGHERTY: Now, this week hundreds of supporters of Christians held a march in Cairo. There was a very heavy police presence. There was no violence. But this is an indication of the growing frustration by Christians -- Wolf.

BLITZER: It's a bad situation.

Jill, thanks very much.