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THE SITUATION ROOM

Wall Street Soars; Senate Scandal; Super Bowl Advertising; Al Gore Defends Selling to Al Jazeera; The Most Expensive Election; Hillary Clinton Resigns; Kerry Arrives at Swearing in Ceremony; Geraldo Rivera for Senator?; New Jersey Senate Showdown; Once Powerful Cardinal Disciplined; $8M a Minute; Controversy Over Some Super Bowl Ads; New York Mourns Ed Koch

Aired February 1, 2013 - 16:00   ET

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


WOLF BLITZER, CNN ANCHOR: Happening now: a banner day for Wall Street and the White House. The Dow has more than doubled under President Obama, but should he take any credit for it?

A U.S. senator's alleged trips to sex parties not only land him in political trouble. Legal troubles may be ahead.

And if you're among the millions who watch the Super Bowl just for the commercials, we will point out the controversial ones you won't want to miss.

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

Today , Wall Street reached a milestone we haven't seen in years. For the first time since 2007, the Dow Jones industrial average climbed above the 14000 mark. The average has more than doubled since bottoming out at 6547, 6547 just after President Obama took office back in 2009.

Let's get quickly to CNN's Alison Kosik. She's over at the New York Stock Exchange.

It looks like it's just above 14000, Alison.

ALISON KOSIK, CNN CORRESPONDENT: It is closing at 14009 after watching the numbers settle.

What's interesting, as we see the Dow cross over 14000 for the first time in five years, believe it or not, not everybody thinks it's a big deal. Some say it's just a nice round number that we like to talk about and others say, yes, it is a milestone after the economy pretty much fell to pieces.

Now this is a sign that things are finally coming back.

(BEGIN VIDEOTAPE)

KOSIK (voice-over): Remember this? March 1999, the height of the dot-com boom. The Dow hit 10000 for the first time.

UNIDENTIFIED MALE: It was a big deal down here when we hit 10000. We gave out hats. These are big. There's like logical levels. They're big. They're crescendos.

KOSIK: Fast forward to 2006, the height of the housing boom, Dow 12000, nine months after that, 14000.

(on camera): But we wouldn't see that threshold again for a long time. The housing market was already crumbling. Recession was lurking. Now, five years later, we are back and the returns staggering.

(voice-over): Bank stocked buoyed by cheap interest rates bounce back, housing stocks through the roof. The rally is driven by you, the individual investor. You have plowed $16 billion into the market in just the past three weeks. The economy seems healthier, but perhaps the biggest driver is the Federal Reserve.

UNIDENTIFIED MALE: It goes right back to the Fed stimulus. Right? And every to central bank around the world, they are pumping the system with so much money and keeping rates artificially low that savers and people looking for yield can't anymore on the fixed income market. So they force this trade into risk assets.

KOSIK: That means stocks. The Fed is pumping $85 billion a month into the economy by buying long-term debt and mortgage-backed securities. That drives down interest rates leaving investors nowhere else to turn. So that's how we got here. But does 14000 really mean anything?

JEREMY SIEGEL, WHARTON SCHOOL OF BUSINESS: These are certainly nice round numbers. I personally think it will be more of an event once we break through that October 2007 all-time high.

KOSIK: That all-time high is 14164.

(END VIDEOTAPE)

KOSIK: And where there are bulls, there are bears, Wolf. One economist is telling me this is just a market where it's a correction waiting to happen. He believes that this rally isn't real, but then again you look at the jobs trend that's been going on, the triple- digit gains in jobs that we have seen lately, and you may want to think twice about that.

BLITZER: Impressive numbers on Wall Street.

Alison, I want to ask you also about the very interesting jobs report that was released this morning. We learned the unemployment rate stands at 7.9 percent after employers hired a total of 157,000 workers, new workers in January. Revised numbers for all of 2012 show the economy adding a lot more than originally reported, total of some 335,000 new jobs beyond those that were originally reported.

Seems like we're adding jobs, but the unemployment rate remains 7.9 percent. Why isn't it coming down?

KOSIK: Exactly. And the unemployment rate actually ticked up last month from 7.8 to 7.9 percent. The reason is because as much as we're sort of cheering the fact that you're seeing these triple-digit gains being made in the jobs numbers, for a very long time now in the jobs market, for a pretty good long time, it's really just not enough to keep up with population growth.

And the thing is, it's really going to sort of kick into gear when we see when Congress plays a role in this in March when they take up the automatic spending cuts again. The big worry here is that you may see a reversal, not just here in the stock market, but in these jobs additions because what could happen, Wolf, is that company may freeze and not want to hire when they see what is going on, on Capitol Hill -- Wolf.

BLITZER: Dramatic numbers on Wall Street and the jobs markets. Alison, thank you.

Virtually everyone with a 401(k) retirement account owns stocks, but today's news from Wall Street is much more than a financial story. There's political fallout as well.

Our chief political analyst, Gloria Borger, is here to discuss how this could impact the president's agenda, how he hopes to get things done.

And just to recap, Gloria, the Dow Jones industrial shortly after, six weeks or so after he took office, March 9, 2009, it was at 6547, today, closing more than 14000, more than doubling over the past four years. A lot of people are making money. A lot of people are -- this president has been good for Wall Street, at least so far. What's the political fallout?

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: Well, it really hasn't helped him politically.

There's always been this disconnect, Wolf, between what's going on in Main Street and going on in Wall Street. People now are somewhat more optimistic about the economy than they were a year or two ago. I would argue that's one of the reasons that President Obama got reelected, because people started feeling better.

But when you look at the numbers about how people regard President Obama's handling of the economy, they are still not really good for him. Take a look at this. We asked in mid-January. Look at that. His approval rate for his handling of the economy, only 48 percent, disapproval, more than half of the voters.

And one reason may be that while Wall Street is doing well, Wolf, household incomes have not rebounded at all since the beginning of the recession in 2007. So people are not feeling it in their pocketbooks.

BLITZER: There are some people who are investing on Wall Street that are feeling pretty good about it.

BORGER: They are. But most Americans are not. BLITZER: Yes. But having said that, he did get reelected with 7.8, 7.9 unemployment, and that's a pretty impressive feat.

BORGER: Because people were feeling a little more optimistic, Wolf, but they still believe the economy is headed in the wrong direction. But their optimism was improving.

BLITZER: So, there's more jobs created, another 150,000 last month. They revised figures for November and December, another 200,000 beyond those earlier announced.

So how is this going to impact his legislative agenda on some of these critically important issues?

BORGER: Before he gets to immigration and everything else, he has to go through all of the business speed bumps, the economic speed bumps.

BLITZER: And there are plenty of them.

BORGER: And there are plenty of them coming up.

And I think both sides can make the case, Wolf, and they will, that a dysfunctional Washington really hurts consumer confidence and hurts business hiring. Republicans will say you have got to decrease the deficit and the president will say, you know what, we have to perhaps think about spending a little bit of money to get out of this and to try and reduce that unemployment rate.

So they are going to come at it from different sides, Wolf. The big thing to think about here is the president's approval rating. It is now at 52 percent. That gives him an awful lot of leverage on these economic issues.

BLITZER: He's going to need that if he's going to get some of these agenda items through.

BORGER: He will need every bit of it. Yes.

BLITZER: Gloria, thanks very much.

A U.S. senator's travel habits are under fire right now and may land him in serious legal trouble. We have the document showing that Senator Robert Menendez did not, as required, report he accepted free plane trips.

Plus, the fall of a man who was once among the most powerful Catholic leaders in the United States.

(COMMERCIAL BREAK)

BLITZER: A number of reports say the FBI is looking into allegations a U.S. senator accepted free trips on a private plane, and while there also are allegations Democratic Senator Robert Menendez flew to the Caribbean for sex parties with prostitutes, the travel itself appears to be his biggest legal trouble right now.

Let's bring our national political correspondent, Jim Acosta, who has been looking into this story.

What are you finding out?

JIM ACOSTA, CNN CORRESPONDENT: Wolf, the Senate's ethics rules are clear when it comes to these free flights Menendez accepted. The senator did not, as required, report them on his financial disclosure form.

The question is, what, if anything, the Ethics Committee will do about it.

(BEGIN VIDEOTAPE)

ACOSTA (voice-over): It was another day of a very public senator keeping a low profile. Outside a dinner Thursday night featuring New Jersey's top political leaders, Bob Menendez only offered a few words in response to the questions flooding his office.

SEN. ROBERT MENENDEZ (D), NEW JERSEY: I have commented already through my office.

UNIDENTIFIED MALE: These are nameless, faceless anonymous allegations.

ACOSTA: Just as Menendez is officially becoming chairman of the Senate Foreign Relations Committee, a key member of the Senate Ethics Committee is indicating the panel is now looking into a raid by federal agents on the offices of Menendez friend and Florida doctor Salomon Melgen.

In a statement, Republican Senator Johnny Isakson said: "We are aware of the news reports regarding the FBI raid on Dr. Melgen's office. The Ethics Committee will follow its established procedures in this matter."

One potential violation of ethics rules, the free flight Menendez took on Melgen's private jet to the Dominican Republic 2010. On his financial disclosure form for that same year, Menendez said, no, he did not receive any reportable travel worth more than $335. His office now says the flights were worth $58,000.

(on camera): Menendez reimbursed Dr. Melgen two years after he accepted those free flights, but according to a governor watchdog, that might not necessarily be a violation of Senate ethics rules.

MELANIE SLOAN, EXECUTIVE DIRECTOR, CITIZENS FOR RESPONSIBILITY AND ETHICS IN WASHINGTON: It's only in the Senate Ethics Committee where you can pay back money and then sort of get off the hook.

ACOSTA (voice-over): Melanie Sloan with the watchdog group Citizens for Responsibility and Ethics in Washington says the trips amount to gifts that should have been reported promptly.

SLOAN: He should have paid the charter rate for the trips at the time or disclosed them, and he didn't do either of those things. ACOSTA: Sloan's group sent over its own file on Menendez to the FBI last summer, including an e-mail from a man claiming the senator was flying to Dominican Republic to meet with prostitutes, a story that eventually appeared on the conservative Daily Caller Web site. But Dr. Melgen is also a big campaign contributor to Menendez. He donated well over $100,000 to the senator's reelection campaign, as well as to connected Democratic committees.

NARRATOR: 2012 was supposed to be his year.

ACOSTA: Melgen's company sent another $700,000 to a super PAC that spent hundreds of thousands of dollars get Menendez reelected.

At a subcommittee last year, "The New York Times" reports Menendez urged government officials to help direct a port security contract to a company tied to Melgen. The top Republican in the senator's home state suggested it's time for Menendez to address all of the questions head on.

GOV. CHRIS CHRISTIE (R), NEW JERSEY: Senator Menendez has been in public life for, gosh, over two decades. I think he has a complete understanding of what he believes his responsibility is.

(END VIDEOTAPE)

ACOSTA: When asked why Menendez failed to report those flights on his financial disclosure time at the time, his staff did not respond to our questions here at CNN.

Intentionally falsifying these forms is a federal crime and we should point, it says so right on the form. You're supposed to report these flights, this travel, properly at the time that you take that travel and when you fill out these forms.

BLITZER: So, this investigation is ongoing right now?

ACOSTA: That is the indication from the ranking Republican on the Senate Ethics Committee. We should report, Wolf, that many of these committee investigations don't really reach the light of day. It's only when they reach the potential for a hearing process that you start to see some movement, perhaps a senator might resign.

In the case of Senator Ensign from Nevada, that was the case with the Senate Ethics Committee investigation regarding Senator Ensign. He decided to go ahead and resign his seat from the Senate, instead of going through a Senate Ethics Committee process.

So, we'll have to wait and see.

There aren't many hearings that come out of these types of investigations. The last time we had hearings, I think, was back in the mid-1990s, Wolf.

BLITZER: We'll stay on top of it. Thanks very much, Jim Acosta, reporting. One time presidential candidate, the former Vice President Al Gore is defending his decision to sell his cable television network Current TV to the Qatari-based news broadcaster Al Jazeera. Analysts estimate that Gore is making roughly $100 million on the deal. Gore spoke with CNN's Fareed Zakaria.

(BEGIN VIDEO CLIP)

FAREED ZAKARIA, HOST, CNN'S "FAREED ZAKARIA GPS": Current TV, a great business deal. But you started it because you wanted to create a greater -- another liberal voice, a stronger one, an independent voice. Is this an endorsement of Al Jazeera and you're saying Al Jazeera represents the same type of traditions that you were trying to further when you found -- when you founded Current TV.

AL GORE, FORMER U.S. VICE PRESIDENT: Well, I think that Al Jazeera has, in fact, established itself as a highly respected international news gathering organization. It's won awards all over the world. It has a reputation for integrity and excellent reporting.

I'm sure you watch Al Jazeera English.

ZAKARIA: You're talking about the English language channel, not the Arabic language?

GORE: Yes. And Al Jazeera America promises to be even better. But as Secretary Clinton has said, Al Jazeera is part of the solution, not part of the problem. It is viewed as a highly responsible organization and I'm very pleased. I think the net result is going to be very positive for the American media landscape.

(END VIDEO CLIP)

BLITZER: Fareed is joining us now from New York.

Good interview, Fareed. What's your take on this sale?

ZAKARIA: Well, I was struck, Wolf, by how gore defended it. He could have said, look, this is a free market, we founded a channel. There was a bidder. We sold the channel.

Conservatives he could have said, look, should be the last person to say I should look into the provenance of every person I sell something to. This is what capitalism is all about. You have buyers and sellers and we sell to the person who was willing to pay us the highest price.

But instead, he really doubled down and said that he -- he endorsed Al Jazeera. He said it was a very positive new entrant into the media landscape. It was very high-quality reporting. It's shown itself to be independent of its origins with the Qatar government.

I was struck by that. That he didn't feel like he just needed to describe this as a market transaction. It was an endorsement of Al Jazeera. BLITZER: Do you think the charges that have been made of Al Gore, that he's being hypocritical because of his passion against global warming, selling his company, a significant part of the company, to Al Jazeera, which is really owned by the government of Qatar, which makes a lot of its money with oil and carbon emissions and all of that, that he's being hypocritical. That's the charge that is being widely leveled against him?

ZAKARIA: Yes. I mean, I tend to be a capitalist about these things. I think that, you know, you do enter into commercial transaction with all kinds of people and all kinds of entities. That's not an endorsement of every single person you enter into a commercial transaction with.

He could say, the guy took $100 million, $500 million away from the Qatar government. You know, that doesn't -- it's not clear to me that every time you engage in commercial transactions, you are morally approving of everything that that person or that entity does.

It's an awkward reality, I think is the way I would put it, more than some kind of actual ethical violation.

BLITZER: Fareed is going to have the full interview with Al Gore this Sunday on "FAREED ZAKARIA GPS".

Fareed, thanks very much for joining us.

I want our viewers to know, you have another excellent interview coming up with the Microsoft founder, Bill Gates -- Bill Gates, Al Gore, Fareed Zakaria, Sunday at 10:00 a.m. Eastern, also 1:00 p.m. Eastern, only here on CNN.

Fareed, good work.

ZAKARIA: Thank you, Wolf.

BLITZER: The 2012 campaign will go down in history as the most expensive to date. We're going to tell you just how much money was spent. But here's a hint. You could have bought dozens and dozens and dozens of islands with all that cash.

(COMMERCIAL BREAK)

BLITZER: Violent protests are unfolding in Egypt's capital, at the presidential palace.

Lisa Sylvester is monitoring that and some of the other stories in THE SITUATION ROOM right now.

Those pictures are pretty dramatic.

LISA SYLVESTER, CNN CORRESPONDENT: That's right, Wolf.

You know, thousands of anti-government demonstrators have gathered outside the presidential palace in Cairo. They hurled rocks and Molotov cocktails over the palace walls. That set up a fire at the entrance. Egyptian security forces fired back with teargas and a water canon. At least one person has been killed.

The protesters are furious at President Mohamed Morsy. They accused him of betraying Egypt's revolution by taking too much power.

And the head of Mexico's oil giant Pemex says it's too soon to speculate if yesterday's deadly blast was caused by a bomb. Thirty- three people, rather, were killed when a blast tore through the company's headquarters in Mexico City. More than 100 people were injured. Crews are combing through the rubble looking for anyone who may still be trapped.

President Obama is losing another cabinet member. Energy Secretary Steven Chu plans to resign in a few weeks. The Noble Prize recipient has been a leading advocate of alternative energy development. He came under fire, though -- criticism from congressional Republicans in 2011 when a solar company went bankrupt after receiving federal financing.

Chu says he wants to return to teaching and research. And in a statement, Mr. Obama thanked him for his, quote, "dedicated service".

Well, take a look at this. The 2012 elections rung up a record tab, all told, candidates, parties and outside groups like super PACs, spent $7 billion. That's according to the Federal Election Commission.

And that amount, just in case you're wondering, is equal to 28 Boeing 787 planes or 70 private islands. Or how about this? Fifty billion polio vaccines.

And if you think that amount of money is a lot? Well, it is expected to rise in the future.

Were you surprised by that number, Wolf? Seven billion dollars?

BLITZER: Seven billion -- that's not just for the presidential races. That's for Senate races, House races -- all the races.

SYLVESTER: And the candidates and the outside money. But that is a huge sum that we're talking about.

BLITZER: A lot of advertising executives, mass mailings executives, social media executives, political operatives, they made a lot of money last year.

SYLVESTER: And everybody says this, you know, that number is only going in one direction -- up.

BLITZER: Yes, a lot of local TV stations, national TV stations, a lot of advertising.

SYLVESTER: We all did.

BLITZER: Thanks very much.

SYLVESTER: All right. BLITZER: Hillary Clinton's tenure as the secretary of state officially ended a little while ago. Her last day on the job was marred, though, by a terror attack. We have the latest details on the U.S. embassy bombing. That's coming up.

And how does this sound -- Senator Geraldo Rivera? He says he's serious. You're going to hear why.

(COMMERCIAL BREAK)

BLITZER: So John Kerry officially the secretary of state. He was due to be sworn in just a few minutes ago at a private ceremony over at the State Department. He has to deal with a crisis, though, from the first moments that he has taken this new job.

A suicide bomber detonated a device outside the United States embassy in Turkey's capital, Ankara, earlier today. He killed a Turkish security guard.

The White House and State Department say there is no doubt what kind of attack this was.

(BEGIN VIDEO CLIP)

JAY CARNEY, WHITE HOUSE PRESS SECRETARY: A suicide bombing on the perimeter of an embassy is by definition an act of terror. It is a terrorist attack.

VICTORIA NULAND, STATE DEPARTMENT SPOKESWOMAN: Clearly, it's a terrorist attack. This was an individual wearing a suicide vest trying to come in to our embassy compound.

(END VIDEO CLIP)

BLITZER: Hillary Clinton says the attack shows we live in what she described as complex and dangerous times. Of course, today was her final day on the job as the secretary of state.

In her resignation letter to President Obama, Mrs. Clinton thanked him for his friendship and the opportunity to serve. CNN foreign affairs correspondent Jill Dougherty is joining us now from the State Department with more. She got a pretty tumultuous reception upon her departure over there, Jill?

JILL DOUGHERTY, CNN FOREIGN AFFAIRS CORRESPONDENT: Yes, Wolf. You know, it was quite some day. She left here, the State Department. In fact, she was right here in this hall about two hours ago after an emotional farewell to her staff.

(BEGIN VIDEOTAPE)

DOUGHERTY (voice-over): On her last afternoon as secretary of state, an emotional farewell to the State Department staff Hillary Clinton led for four years.

HILLARY CLINTON, FORMER SECRETARY OF STATE: I will miss you. I will probably be dialling ups just to talk. I will wonder what you all are doing because I know that because of your efforts day after day, we are making a real difference.

DOUGHERTY: But early Friday morning, even before she left her house, reports of a suicide bombing outside the U.S. Embassy in Ankara, Turkey. Clinton was briefed by her staff then was driven to the State Department where she called the U.S. ambassador to Turkey and the Turkish foreign minister.

At the same time, Senator John Kerry, the man who within hours would succeed Clinton as secretary of state was briefed by his staff on the attack. Arriving at his Senate office for the last time, Kerry brushed off questions about the attack in Turkey saying he was still a senator and wasn't going to get into that.

NULAND: As you know, though, we only have secretary of state at a time. So she's the sitting secretary until 4:00 and then he will take over and take up his duties, obviously a difficult day for both of them.

DOUGHERTY: Hillary Clinton then drove to the White House for a farewell meeting with President Obama. She formally submitted a letter of resignation saying, I am more convinced than ever in the strife and staying power of America's global leadership and our capacity to be a force for good in the world.

Then just hours before leaving the State Department for good, more breaking news riots at the presidential palace in Egypt. But now for Hillary Clinton, private citizen, all of that is in John Kerry's hands.

(END VIDEOTAPE)

DOUGHERTY: And the new secretary of state already is making plans for his first official trip according to U.S. official, John Kerry expected to travel to Israel and to Egypt, perhaps as early as the middle of February and also western diplomats saying that he's been invited to some European capitals as well -- Wolf.

BLITZER: We should point out, Jill, that the new Secretary of State John Kerry, he is up on Capitol Hill actually being sworn in a private ceremony. He just got into the chambers there at the Senate Foreign Relations Committee. The Supreme Court Justice, Elana Kagan walking in as well.

She will swear him in this private ceremony. I assume there will be a public ceremony at some time as well, but there she is, Elena Kagan walking into the Senate Foreign Relations Committee to do the honors to swear in the next secretary of state, John Kerry. I earlier said the State Department. I obviously wanted to correct that. Thank you, Jill.

It should be a seamless transition over at the State Department. John Kerry is being sworn in as we all know. But there is some political news fallout from all of this. Republican former Senator Scott Brown announcing this afternoon he will not run for John Kerry's Senate seat.

Let's talk a little bit about what is going on in our "Strategy Session." Joining us, our CNN contributor, the Democratic strategist, Donna Brazile and CNN contributor, the Republican strategist Ana Navarro.

Ana, a lot of folks thought that the Republicans would have a pretty decent chance of winning that Senate seat if in fact Scott Brown were to run. He's not running. So does that mean in effect the Republicans are going to give up on it?

ANA NAVARRO, CNN CONTRIBUTOR: Absolutely not. You don't give up until you lose, Wolf, and until then you try to win. You know, a PPP poll, which is a liberal leaning poll, had shown that Scott Brown was 3 points ahead in that race, which tells you that the Democrats don't have a lot of on that race.

They may have it themselves, the Democrats, a very bloody primary between Congressman Marky and Congressman Lynch. I think Scott Brown, not making a decision had froze in the field. He was the elephant in the room.

But we do have some good candidates in Massachusetts. There's former Lieutenant Governor Healy, there's a former state governor, who is openly gay. There's a Hispanic who was a former Navy SEAL and has been in the financial sectors for 15 years.

There's also former Governor Weld. So we have good candidates. I think you're going to see them quickly coming in and filing now and we're going to have a race. Remember, this is a special election. Anything can happen in a special election, as Scott Brown himself showed.

BLITZER: That's a fair point, Donna. We don't know what's going to happen. We don't know the Democratic candidate will be, maybe Ed Marky, maybe not. What do you think?

DONNA BRAZILE, CNN CONTRIBUTOR: Well, first of all, I applaud Senator Brown for his decision to step aside, so to speak. I do believe that this seat will now lean Democratic for obvious reasons. It is a blue state.

The Democratic Party is much stronger today than it was two years ago and I also believe that Duval Patrick made a good decision with the interim person that will free up the Democratic Party that put all of its resources in securing a seat for the special election.

There's no question that running for Senate is a costly endeavour and with Ed Markey and perhaps Mr. Lynch, we will have a vigorous primary. But at the end of the day, the Democrats are united in Massachusetts and we will retain this seat.

BLITZER: Let's talk about New Jersey because there could be a pretty interesting Senate race next year in New Jersey as well if Geraldo Rivera decides he wants to be the Republican candidate to face either Frank Lautenberg if he seeks re-election, Cory Booker, the mayor of New Jersey is toying with the idea as well. Listen to Geraldo Rivera on Fox earlier today.

(BEGIN VIDEO CLIP)

GERALDO RIVERA, FOX NEWS ANCHOR: Remember, I believe in immigration reform. I believe in gay rights and gay marriage. I believe in choice. Not obscenely, but I believe in Roe V. Wade. So you have to take my fiscal positions on being a Republican who believes that we have to bail out future generations rather than in dead future generations with some of these social policies that aren't in sync with much of traditional GOP politics at least not in recent years.

(END VIDEO CLIP)

BLITZER: He's a pretty moderate Republican, Ana. But in New Jersey, if you want to get elected, Chris Christie is the Republican governor of New Jersey. I assume Geraldo would have a shot.

NAVARRO: I think he would. There's a lot of Hispanics in northern New Jersey, Wolf. As somebody who has always been advocating to have more Hispanics be candidates in the Republican Party, I would welcome his participation.

I think he would bring flair to a race we all thought would be ho-hum. You know, again, anything can happen. There's a lot of bad blood between current Senator Lautenberg and Cory Booker who is basically measuring the drapes before Lautenberg has even said he is not going to run.

You have Chris Christie with a popularity in the 70s. So, you know, anything can happen certainly. I also reached out to the NRSC, the National Republican Senatorial Committee today and they've told they have reached out to Geraldo Rivera's camp.

And that they would be welcome to help him in any way that they would help any other candidate. So they have reached out and they think he is seriously considering it.

BLITZER: Donna, was it appropriate for Cory Booker to say that he's interested in getting that Democratic senatorial nomination even before Frank Lautenberg has said whether or not he's going to seek re- election?

BRAZILE: Look, I respect all of the politicians. Senator Lautenberg is truly a champion that I admire and would love to see continue the Senate, but Cory Booker has to begin to think through what his future plans are. He's been an outstanding mayor of Newark. I'm one of his followers on Twitter.

He's a great public servant. But I want to say something about Geraldo because I've been looking at all his position, normalizing relations with Cuba. He's a great showman. He's passionate about all these issues, but when you start to look at everything he's said and done on television over the last 20 years and shows like this, Wolf, he's going to have a real, tough time securing a Republican primary.

But I want to applaud Cory Booker for being out there and at least consider running because as you know if you decide to run for the United States Senate, you have to raise millions and millions of dollars. I'm glad he's putting his name out there and I know Republicans like to say that Democrats are having a bit of a messy family stuff but at the end of the day, Frank Lautenberg and Cory Booker will sit down and break bread and we'll see what happens.

BLITZER: We'll see what happens. It could be exciting. I've known Geraldo for at least 30 years. He's a smart guy. He's got good name recognition. It would be a lively race.

NAVARRO: Maybe that's precedent. Media guys coming to politics. You never know. Senator Wolf Blitzer, I like the ring of it.

BLITZER: I don't that's happening. But Geraldo, you never know. Guys, thanks very, very much.

BRAZILE: Wolf, if you decide to get involved in politics --

BLITZER: I'm not getting involved in politics. I'm aiming for exactly what I'm doing right now.

BRAZILE: Have a good Super Bowl weekend, Wolf.

BLITZER: You guys as well. Thank you.

NAVARRO: Thank you.

BLITZER: He's one of the most powerful Catholic leaders in the country, but today L.A.'s Cardinal Roger Mahony was relieved of his duties. Some call it an unprecedented move. What prompted it? Stand by.

(COMMERCIAL BREAK)

BLITZER: A man who was once the most powerful leaders of the U.S. Catholic Church today stands in disgrace. The retired Los Angeles Cardinal Roger Mahony has been relieved of his remaining duties because of newly released court documents.

CNN's Brian Todd is coming into THE SITUATION ROOM. He has been looking into this. It's pretty shocking stuff, Brian.

BRIAN TODD, CNN CORRESPONDENT: Shocking, Wolf. You know, such a public reprimand of a cardinal is according to church observers, just stunning. It doesn't happen. The fact that Cardinal Mahony was rebuked by the man who replaced him speaks to the depth of the scandal in the arch diocese of Los Angeles.

(BEGIN VIDEOTAPE)

TODD (voice-over): It's the biggest Catholic arch diocese in America and it's now reeling from a scandal that extended to its top official. In unparalleled move, Cardinal Roger Mahony who retired as head of the Los Angeles arch diocese in 2011, has been relieved of all his public duties. The man slapping him down, Jose Gomez, the current arch bishop of Los Angeles. In announcing the rebuke of Cardinal Mahony, Gomez says the way that arch diocese handled decades of allegations of priests' abuse under Mahony's leadership was a terrible failure.

TOM ROBERTS, EDITOR, NATIONAL CATHOLIC REPORTER: This is almost unheard of. It's unheard of in the clerical culture especially (inaudible) of a culture for a bishop to rebuke another bishop, in this case, a public rebuke of not only a bishop, but a very high profile cardinal. That's what stunning about this.

TODD: Tom Roberts is editor-at-large for the "National Catholic Reporter" newspaper. He says what makes this such a painful moment for the church is that Mahony's reprimand comes in conjunction with the release of 12,000 pages of documents by the L.A. arch diocese.

Revealing how it handled allegations of sexual abuse involving nearly 200 priests and bishops. A judge had ordered the archdiocese to release the papers. They give graphic accounts of the sexual abuse of minors. What Archbishop Gomez calls brutal and painful reading and a detail a cover up.

ROBERTS: A very clear and deliberate actions to hide priests from law enforcement.

TODD: In one memo from January 1988, an official of the L.A. archdiocese discusses allegations against Father Nicholas Aguilar Rivera, a visiting priest from Mexico, who the L.A. County District Attorney's Office later charged with 19 counts of molestation.

The official discusses whether to give investigators a list of parish altar boys to interview. The memo says, "The whole issue of our records is a very sensitive one and I am reluctant to give any list to the police."

The L.A. County District Attorney's Office tells us Aguilar-Rivera remains a wanted man. That he fled to Mexico years ago and they haven't been able to extradite him. CNN was also unable to find him.

People who identify themselves as victims of abuse in the L.A. archdiocese say the release of the documents and the reprimand of Cardinal Mahony are still not enough.

JIM ROBERTSON, ABUSE VICTIM: These people behaved horrifically, absolutely horrifically. As far as I am concerned, their felonies must still be paid for and I think the federal government needs to be looking at this deeply.

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TODD: The L.A. County District Attorney's Office tells us it is looking at all of this. It is reviewing the newly released files. The archdiocese issued a statement apologizing again to abused victims and saying its efforts to protect children over the past decade have been among the best in the country. We could not get a response from Cardinal Roger Mahony to the reprimand from Archbishop Gomez or to the release of the documents. Wolf, the cardinal, Roger Mahony, remains a priest of good standing in the L.A. archdiocese.

He can celebrate mass with no restrictions. He can vote for the pope even now. The only thing he cannot do is give as many speeches and lectures as he once did.

BLITZER: What a fall. What a fall indeed. Thanks very much, Brian Todd for that report.

On a very different note, this Sunday, millions and millions of Americans will be watching the Super Bowl, many of them for the commercials. This year, several of them are steeped in controversy.

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BLITZER: More than 179 million people are expected to watch Sunday's Super Bowl showdown. So it's the most prime -- it's an excellent time for advertising. Advertising real estate is critically important.

Lisa Sylvester is joining us now. Lisa, you've been taking a closer look at some of these ads that we'll see Sunday. We'll be talking about Monday.

LISA SYLVESTER, CNN CORRESPONDENT: I want to first talk about some of the numbers. All right, $4 million for a 30-second ad, $8 million for a-minute long ad, and some companies are taking out more than one spot for the Super Bowl. So it comes down to how much impact these ads have and how much buzz.

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SYLVESTER (voice-over): It's all about the big reveal. Who is going to have the most talked about Super Bowl ads? But this year companies aren't even waiting for Super Bowl Sunday. They are rolling them out now.

BRANTLEY DAVIS, DAVIS AGENCY: There's the tail wagging the dog here? Yes. That's what's happening now. Before the Super Bowl even gets here, there's hype about the ads. So for guys like me who make our living this way, we couldn't have it any better. That's great. That's what we want.

SYLVESTER: Here's a look at a couple of the ads you'll see on Sunday.

UNIDENTIFIED MALE: No worries, man. Everything will be all right.

SYLVESTER: This one from Volkswagen, instead of getting kudos, is generating controversy for VW.

UNIDENTIFIED MALE: Yes. Great coffee, Mr. Jim.

SYLVESTER: The ad didn't go over well with some members on the panel on CNN's "STARTING POINT." CHRIS JOHN FARLEY, WSJ SPEAKEASY BLOG: I always have a problem with Jamaican accent that they are super imposed on other people --

SOLEDAD O'BRIEN, HOST, CNN'S "STARTING POINT": The quality of the accent?

FARLEY: It's not the quality of the accent. It's the fact the accent was coming out of people who seemingly were not supposed to be from Jamaica. It was done as a joke.

SYLVESTER: VW said they test marketed the ad to make sure it wasn't offensive and collaborated with musician, Jimmy Cliff.

UNIDENTIFIED MALE: At the end of the day, VW is a brand that everybody has a story about and quite often those stories put a smile on their face. That's what we're trying to achieve.

SYLVESTER: It's not the only ad that will likely raise eyebrows on Sunday.

UNIDENTIFIED FEMALE: Together they are perfect.

SYLVESTER: Advertisers want to keep with you a lasting image of their ad and hopefully their products.

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SYLVESTER: OK, I'm one of those, I love watching Super Bowl ads. Something else has changed in the last few years and that is social media, Twitter and Facebook. People are going to be watching and tweeting which ads they loved, which ones they didn't like so much and the word of mouth advertising is very, very valuable to these companies -- Wolf.

BLITZER: Because they can make a lot of money. That's what they are in the business of doing.

SYLVESTER: Yes, I got to say. This was a fun assignment because I got to watch a lot of these ads in advance of Super Bowl Sunday so there are some good ones to watch for.

BLITZER: We'll be watching those ads too. Thank you.

CNN's special coverage of Super Bowl XLVII kicks off on Saturday in New Orleans at 4:00 p.m. Eastern. We're breaking down the big event, what it means for the city, standby for that.

A Hollywood star on Capitol Hill, but this time he's shadowing a congressional leader. Kevin Spacy is here in THE SITUATION ROOM to explain why. But, first, Ed Koch's successors remember the former mayor and we have his final interview.

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BLITZER: A great mayor, a great man, and a great friend. That's how New York Mayor Michael Bloomberg is paying tribute to his predecessor Ed Koch who died this morning at the age of 88. CNN's Jason Carroll looks at his life and legacy.

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ED KOCH, FORMER NEW YORK CITY MAYOR: Whenever I would fly home, there was the city of New York laid out before me and I thought to myself, this belongs to me.

JASON CARROLL, CNN NATIONAL CORRESPONDENT (voice-over): He was funny.

KOCH: Shut up, will you? And let me talk to these people.

CARROLL: He was tough and confident.

KOCH: Good morning. I'm Ed Koch and I'm running for mayor and I need your help.

CARROLL: Ed Koch was just like the city he loved, vibrant, on the go, and in your face.

DAVID DINKINS, FORMER NEW YORK MAYOR: He'll be remembered by me and I hope a lot of other people with one who told it the way he saw it, and he never minced words.

CARROLL: Koch became mayor in 1978, during a time when New York was a much different place.

KOCH: When I came in, the potholes were enormous, the trains, the subways had graffiti. Crime was rampant.

CARROLL: Not just rising crime, businesses were leaving. New York was on the brink of bankruptcy. Koch saved the city.

KOCH: I brought a spirit back to the city of New York that was absent because New Yorkers were ashamed of living here because of what prior administrations had done.

MAYOR MICHAEL BLOOMBERG, NEW YORK: When we were down, Ed Koch picked us up. When we were worried, he gave us confidence. When someone needed a good kick in the rear, he gave it to them. If you remember, he enjoyed it.

CARROLL: Koch served three terms and laid the foundation for what the city is today low crimes, revitalized neighborhoods and more affordable housing. His popularity slipped in the third term as racial tension surfaced in parts of the city.

Koch's critics accused him of being slow responding to the aids crisis, a corruption scandal weakened his administration. In an interview with Piers Morgan last month, Koch reflected on his legacy.

KOCH: God gave me a very good hand to play over my 88 years. I have no regrets.

CARROLL: In his later years, Koch acted as a judge on the People's Court, hosted a radio show, his supporters even asked him to run again in 1993. KOCH: I said no. The people threw me out, and now the people must be punished.

CARROLL: Koch's personal life remained private. He never married. There were always questions about his sexuality. Filmmaker, Neil Barsky, just directed a documentary about the mayor.

NEIL BARSKY, DIRECTOR, KOCH: What's more poignant was that not that he was gay or straight, but that he was alone. You know, he never had a lifetime companion. And I do think that's poignant about that.

CARROLL: Koch will be buried at Trinity Church Cemetery in New York. He was the son of Polish Jewish immigrant. his headstone will evoke his faith and quote slain journalist, Daniel Pearl's final words. "My father is Jewish, my mother is Jewish, I am Jewish. Ed Koch was 88.

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BLITZER: You just saw a little bit of Piers Morgan's conversation with Ed Koch in the last few weeks. Tonight at 9:00 p.m. eastern, be sure to watch the interview on Piers Morgan tonight right here on CNN.