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The Situation Room
Disaster at Sea in Egypt; Bush Gets Boost from Positive Jobs Numbers; Libby Trial Date Set for 2007; John Boehner's First Day
Aired February 03, 2006 - 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: Ali, thank you very much. And to our viewers, you're now in THE SITUATION ROOM where new pictures and information from around the world are arriving all the time.
Happening now, disaster at sea. It's 11:00 p.m. in Egypt where officials are trying to figure out why a crowded passenger ship sank. Dozens are dead, dozen more missing.
Also this hour, a pick-me-up for American workers and for President Bush. It's 4:00 p.m. here in Washington where a new unemployment report was unveiled today. We'll have the bottom line on the economics and the politics of jobs.
And the timing of the CIA leak trial. Lewis Scooter Libby's day in court won't come soon. What does that mean for the former Cheney chief of staff and his legal strategy and for upcoming elections?
I'm Wolf Blitzer. You're in THE SITUATION ROOM.
Up first this hour, rescue and recovery in the Red sea. Egypt's transport minister reports 263 survivors from the passenger ferry ship that sank in bad weather today. Dozens of the 1,400 people on board are dead. Many, many more are missing. Most of the passengers were Egyptian workers returning from their jobs in Saudi Arabia. The ship was heading for the Egyptian port of Safaga when it lost radar contact.
CNN's Ben Wedeman is on the phone for us now. He's joining us from the port. Ben, what is the latest?
BEN WEDEMAN, CNN CORRESPONDENT: Well, as you said, Wolf, the Egyptian transport minister is saying 263 people have been pulled alive from the water. But, obviously, many, many hundreds more have not been accounted for.
Now, I'm right outside the port where there are hundreds and hundreds, possibly more than 1,000 Egyptians awaiting the news of their relatives who were on board that ship right in front of me. In fact, there's a man in a robe (ph) and sobbing because he doesn't know any information about his son who was on the boat.
Now, a little while ago, there was an official from the ship company who was reading a list of the passengers. It was a very emotional scene because people are angry. They want to know who are the survivors. And until now, that information has not been made available to the people here. Now, Wolf, it is 11:00 p.m. It is dark, it is becoming a bit misty here. And we're told by Egyptian officials that the rescue operation is still ongoing, but under these conditions it's going to be very difficult indeed, Wolf.
BLITZER: Do they think, Ben, this ship went down during daylight hours or overnight?
WEDEMAN: No, it went down overnight. Precisely when, nobody knows. It left the Saudi Arabian site at 7:00 p.m. It was due to arrive here at 3:00 a.m. in the morning. And sometime -- we're told around midnight -- is when it appeared when they lost radar contact with it. So it was at night. It was at a time when winds were high, waves were high as well.
And just so you know, I'm watching three, four, five, six ambulances have just left the entrance of the port going in the direction of the Safaga Hospital. Now, there are lots of riot police here as well, trying to keep the crowd away, not only from the hospital but from the entrance to the port, as well.
BLITZER: As you know better than most, Ben, have been terrorist attacks against Egyptian targets at Luxor, Sharm El-Sheikh, elsewhere in Sinai. Have Egyptian authorities ruled out terrorism in this particular case?
WEDEMAN: Well, they haven't ruled it out all together but they're certainly playing down the possibility of that happening. Now, if you look at the previous attacks in Egypt, terrorist attacks, they were aimed at tourist targets or foreigners.
And in this case, obviously, the boat, we're told -- I'm told by people who actually saw the list that there was one American on board, but by and large, the great majority of the passengers were Egyptian laborers returning from their jobs in Saudi Arabia. We're told also there were about 100 Saudi nationals on board that ship -- Wolf.
BLITZER: Ben Wedeman reporting for us. Ben's going to be staying with us throughout the next several hours here on CNN as we get more information on this huge tragedy. We'll bring it to our viewers.
Outrage and protests across the Muslim world today and beyond, over Danish cartoons of the Prophet Mohammad. In Gaza, thousands of Palestinians took to the streets accusing Denmark of defaming the holy figure.
In Iraq, the nation's top Shiite cleric joined in denouncing the cartoons, but he also suggested Muslim militants are partly to blame for distorting the image of Islam. One of the cartoons showed Mohammad wearing a turban shaped as a bomb. Muslims also protested in Indonesia and in Turkey.
The United States is defending the principle of free speech but is criticizing the publication of the caricatures -- that from the State Department in a statement earlier today. The anger also spread to the streets of London where hundreds of demonstrators chanted "kill Denmark." European leaders joined the call for restraint by newspapers.
Denmark's prime minister met Muslim envoys hoping to calm the furor, but he says his government cannot be held responsible for the actions of an independent newspaper. We'll have much more on this coming up in our next hour including debate over freedom of speech versus supposedly inciting violence.
President Bush is understandably eager to tout any upbeat economic news, and he got some today, that new report showing the unemployment rate down to its lowest rate in four years. But are the numbers as rosy as they seem? We'll go to CNN's Elaine Quijano at the White House in a moment.
First let's get the latest, the "Bottom Line" from our Ali Velshi -- Ali.
ALI VELSHI, CNN ANCHOR: (OFF-MIKE). The 193,000 jobs added is lower than the 250,000 that economists have expected. But over the course of the last year, the average number of jobs created in the United States, 175,000. The average hourly wage, $16.41.
Right now, that's up a little bit, and we've seen the biggest gain in hourly wages in the last year. People make more money in jobs. That's probably good for the economy because they'll spend money, Wolf.
BLITZER: What kind of jobs are we talking about, mostly the jobs that were created?
VELSHI: Well, the largest grouping was in construction, 46,000; health care; food services and bars, 31,000. Financial activities and accounting were big gainers. Interestingly, zero gain in the retail sector, zero gain in the manufacturing sector. And I think we could have expected that.
So a mix, not bad quality of jobs, but keep in mind, it's not just a raw number that matters. It means are people in jobs where they get benefits and the wages are OK. So yet to see. The president enjoying these numbers right now, but left to see how it will do for the rest of the year, Wolf.
BLITZER: Ali Velshi with the "Bottom Line." Ali, thank you very much. Ali will be back with us in the next hour, as well. You can also catch Ali and other CNN reporters on the excellent program "ON THE STORY." That airs Saturday nights, 7:00 p.m. Eastern here on CNN before a studio audience at George Washington University. Ali Velshi and "ON THE STORY," Saturday night 7:00 p.m. Eastern.
Let's go to the White House right now and the Bush administration's take on the new economic numbers. Our White House correspondent Elaine Quijano has that -- Elaine.
ELAINE QUIJANO, CNN WHITE HOUSE CORRESPONDENT: Good afternoon to you, Wolf. President Bush getting a boost from the latest jobs figures out. The president also talking up innovation, continuing with his post State of the Union tour. Today the president was in New Mexico at the headquarters in New Mexico for the computer chip maker Intel.
Later, the president moved on to Dallas, Texas. There he visited a school of engineering and science. And the president is basically continuing to promote what he calls his competitiveness initiative, which he outlined during his State of the Union Address.
Now, the proposals, of course, nowhere near the scale of the ambitious goal the president set last year of trying to overhaul Social Security. Instead, these initiatives relatively modest. They include making tax breaks for research and development permanent, also strengthening math and science courses in U.S. schools.
Now, the proposals are really designed to alleviate concerns people have about the economy, something that Republican strategists say continues to be a major source of anxiety. Now, on that note, the president today did tout those job numbers, saying they are a sign of an improving economy.
(BEGIN VIDEO CLIP)
GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: We've overcome a lot. I really ascribe that to mainly the entrepreneurial spirit of America is strong. The small business sector is strong. I do happen to think good tax policy helped. I think keeping taxes is low is an important way to make sure this economy continues to grow.
(END VIDEO CLIP)
QUIJANO: And looking ahead to next week, the president is going to address another concern that some of his fellow Republicans have had, and that is the budget. next Tuesday, the president heading to New Hampshire to talk about that -- Wolf.
BLITZER: Thanks very much. For the month of January, the upswing in new jobs was reflected online, as well. Internet job advertisers, monster.com, Hotjobs and Careerbuilder all observed growth in a number of industries.
Our Internet reporter Jacki Schechner is monitoring the story. She's joining us live -- Jacki.
JACKI SCHECHNER, CNN INTERNET REPORTER: Wolf, all three told me that if you're going to look for a job online, now is the time to do so. Monster puts together what it calls an employment index, and it studies about 1,500 Web sites, puts together data based on how many jobs are offered online. The top three states they came up for January? Alaska, D.C., and Arizona.
As far as industries are concerned -- now, keep in mind, these are an increase in postings in industries. Accommodations, food services, manufacturing, educational services. This is not necessarily reflecting the jobs that are out there, like Ali was talking about. This is how many postings we're seeing online. They've got a local map, as well. You can go into your region and find out what the job sectors are like there in terms of online availability.
Now, Career Builder was telling me today they are also seeing an upswing in postings in finance, accounting. Health care does continue to still be big. Yahoo, Hot Jobs, told me the exact same thing. We're also seeing an increase in I.T. jobs.
What they all told me, which was very interesting, Wolf, is they're also seeing not only an increase in number, but an increase in better compensation. One spokesperson told me that there is a war for talent out there, and when that happens, the potential hire is the one who ends up winning.
BLITZER: All right, Jacki, thank you very much. Jacki Schechner reporting.
Other news we're following here in Washington, a trial date has now been set for former Cheney chief of staff, Lewis Scooter Libby. He'll face perjury, obstruction of justice charges in the CIA leak case, almost a year from now. That would be on January 8th, 2007. Libby's lawyers say their client will be proved totally innocent. But will the timing of the trial help or hurt their case?
Our chief national correspondent John King is joining us with more.
Why is it going to take so long for the start of this trial? It seems like a long time, John.
JOHN KING, CNN CHIEF NATIONAL CORRESPONDENT: Sure is, Wolf. Almost a year away, as you noted. And the judge today said why? Because of the contentious legal issues here. Number one, the Libby defense team has made clear it wants to subpoena not only documents and e-mails, but also testimony from journalists. They expect the news organizations to fight that. Those cases could go on through the court throughout the spring, the summer, perhaps even into fall.
Another contentious issue, classified documents. The Libby defense team says it wants to see a number of classified records. Not only wants to see them to help prepare the defense, but also might want to introduce some of them in the trial, put them before the jury. So there will be fights over what can be made public. Not only will the prosecutor have to weigh in on that, but the FBI, CIA, even the White House might have to weigh in on that.
So what the judge wants is to resolve all these issues, and they could go up to the appeals court, do that over the next several months, so that when you do have a trial, it is clean. It is not interrupted by further appeals. Because of those, the likelihood of contentious issues, the judge said let's go for next January.
BLITZER: Libby's lawyers are asking for some of the most classified documents around, including the president's daily intelligence brief. Why are they -- why do they need that? KING: This could be a fascinating fight, Wolf. The president's daily brief is the most sensitive government intelligence document. Libby's team says they need to show how busy he was, how involved he was in some of the most sensitive national security issues facing the country: the war on Iraq, the war on terrorism.
They want to make the case that this is somebody who was overwhelmed with highly sensitive information, and that if he made inaccurate statements to the FBI and to the grand jury, he did so out of confusion, out of faulty memory, because he was so busy, not because of any effort to deliberately lie to the prosecutors.
But this could be a big test -- not for the White House. The prosecutor says he has some snippets from the daily brief, but not much. If Libby wants more, he may be going to court against his former bosses, the president and vice president, who as you know, have tried to keep this document, the daily brief, from Congress and the 9/11 Commission. So that could be an interesting fight.
BLITZER: When I heard earlier today that the trial won't start till January, my political antenna were immediately raised. This comes after the midterm elections in November. What are the political ramifications?
KING: Well, it certainly is a relief to some Republicans, who already know the Democrats want to make Republican corruption, Republican abuse of power. Those allegations are key to the Democratic campaign. So you won't have Libby on trial during the campaign. That could help the Republicans, one might argue.
At the same time, though, Wolf, all those other fights we were just talking about -- compelling testimony from journalists, trying to get access to classified documents -- there will be hearings and rulings on the key issues throughout the summer and fall. So even though the trial won't begin until January, you may still hear quite a bit about it during the campaign.
BLITZER: Libby has hired some of the best criminal defense attorneys in Washington, almost some of the most expensive criminal defense attorneys here in Washington. It's estimated he's going to need $5 or $6 million to pay for some of these legal bills. He's got a legal defense team, a fund that's now been established with some pretty prominent names. Tell our viewers about that.
KING: There are many prominent names, including former Senator Fred Thompson; former presidential candidates Jack Kemp and Steve Forbes; a big fundraiser, Mel Sembler, who was an ambassador in this administration. "The New York Times" with a report on this today -- we've confirmed some of the numbers here at CNN -- they say they have about $2 million so far. They're going for a goal of $5 or $6 million.
Some campaign finance good government groups will say whoa, how can you raise money for this guy? Are you trying to buy his testimony, raise money for him so he doesn't say anything damaging to the defense? His friends say nonsense. They say simply, Wolf, he has every right to mount a vigorous defense. He needs a lot of money. We're going to help him raise it.
BLITZER: And John's going to be back with us at 7:00 p.m. Eastern tonight for more on this story, right here on THE SITUATION ROOM. John King, thank you very much.
Let's go up to New York. Jack Cafferty's standing by with "The Cafferty File." Hi, Jack.
JACK CAFFERTY, CNN ANCHOR: Hello, Wolf.
President Bush is going to ask Congress for another $120 billion to pay for the wars in Iraq and Afghanistan. That will bring the total spending since the 9/11 attacks to about $440 billion. The administration says this would fund operations into 2007, but some officials say it still won't be enough. Also, it's not likely to include any money for reconstruction in Iraq.
Remember how we were told a while back Iraqi oil would be used to offset all these costs of this war? The new request is in addition to the president's expected $439 billion Defense Department budget for next year. We're starting to get up into some real money here, boys and girls.
The question is this. Is there a limit to how much the U.S. should spend on the wars in Iraq and Afghanistan? E-mail us at caffertyfile@CNN.com or go to CNN.com/caffertyfile -- Wolf.
BLITZER: Jack Cafferty, thank you very much.
Coming up, fresh face or status quo? The new House majority leader is under intense scrutiny. Is John Boehner the reformist he claims to be? He certainly claimed to be in his campaign. Or more of the same?
Also ahead, a senator's challenge to fellow Democrats to get tougher on President Bush. Will Evan Bayh's call to arms succeed?
And the politics of Scooter Libby's trial date. We'll have more on this story. 2007, is that the best time or worst time for the CIA leak case to go to court? Questions for Joe Lockhart and Bay Buchanan in our "Strategy Session."
You're in THE SITUATION ROOM.
(COMMERCIAL BREAK)
BLITZER: Zain Verjee's off this week. Fredricka Whitfield's filling in from the CNN Center global headquarters in Atlanta, with a closer look at some other stories making news. Hi, Fred.
FREDRICKA WHITFIELD, CNN ANCHOR: Hello to you, Wolf. Federal, state and local authorities are investigating a string of fires at six Baptist churches in Alabama. Investigators say five of the blazes were set overnight at churches in Bibb County, about 45 miles southwest of Birmingham. Arson is suspected. A sixth church that was under construction burned yesterday in neighboring Chilton County. There are no reported injuries.
In Texas, federal authorities have seized arsenals of illegal weapons and improvised explosive devices. They say the weapons were stockpiled in Laredo, apparently in connection with a drug trafficking battle between warring Mexican drug cartels. The stash includes grenades, assault weapons, silencers, machine gun assembly kits and police scanners.
Massachusetts police are looking for a teenager suspected of attacking several people in a gay bar. Police say 18-year-old Jacob Robida shot two people and struck another with a hatchet yesterday. More than 100 people attended a vigil in New Bedford last night. One of the three men injured is in critical condition.
Coretta Scott King's body will lie in honor tomorrow at the Georgia State Capital. Another public viewing will take place on Monday at the Ebenezer Baptist Church Heritage Sanctuary. Mrs' King's husband, civil rights leader, Dr. Martin Luther King, Jr., preached at that very church. Mrs' King's funeral will be Tuesday -- Wolf?
BLITZER: Fred, thanks very much. We'll check back with you soon.
This is John Boehner's first full day as the number two man in the U.S. House of Representatives. And he's trying to help the Republican leadership project a new and improved image. But Boehner is facing some serious questions about his reformist credentials in the wake of the Jack Abramoff lobbying scandal. Our congressional correspondent, Ed Henry, has been checking into that. Ed?
ED HENRY, CNN CONGRESSIONAL CORRESPONDENT: That's right, Wolf. Republicans are certainly hoping that John Boehner can turn the page on all those ethics controversies that dominated the Tom DeLay era. But now Boehner own close ties to lobbyists are getting some heavy scrutiny.
(BEGIN VIDEOTAPE)
HENRY (voice-over): Republicans are eagerly presenting John Boehner as a fresh face who likes to loosen his collar.
AMY WALTER, COOK POLITICAL REPORT: I think the message that they're sending is, We're going to roll up our sleeves and get this lobbying reform done.
HENRY: But that fresh face features a fabulous tan, because Boehner has one of the lowest golf handicaps on Capitol Hill, a hobby that's helped forge close ties with lobbyists.
REP. JOHN BOEHNER, (R) MAJORITY LEADER: I have good relationships with K Street and people who lobby us, both paid and unpaid. I can tell you that everything I've ever done is aboveboard, ethical in every action I've taken.
HENRY: But Democrats note Boehner is one of the top recipients of free travel from groups trying to influence government policy. Thirty-nine trips, totaling $157,000, to golfing meccas like Scottsdale, Arizona, and Pebble Beach, California.
His political action committee bulges with big money: $122,000 from student loan giant, Sallie Mae, which is major business before the Education panel he used to oversee, and tobacco companies like R.J. Reynolds. Several years ago, Boehner raised eyebrows by using the house floor to distribute checks from tobacco PACs, which he's apologized for.
As majority leader, Boehner is now pushing a go slow approach to reform efforts in the wake of the lobbying scandals.
BOEHNER: Clearly the rules are working because these members were in fact caught, and they're going to pay the punishment.
(END VIDEOTAPE)
HENRY (on camera): When he served in the leadership under then- Speaker Newt Gingrich, Boehner actually participated in a controversial conference call with the Republican leaders in which they plotted a PR strategy to deal with an ethics controversy involving Gingrich.
Democrats are now raising questions about that, but you know, that phone call was actually -- since Boehner was on a cellphone -- it was taped by a Florida couple. They got it off a scanner. Then Democrat Jim McDermott ended up leaking it to the media. Boehner actually filed a lawsuit against McDermott that McDermott is still filing, and McDermott, not Boehner, is the one who is facing an ethics complaint and a possible investigation right now by the House of Representatives, Wolf.
BLITZER: Ed Henry, reporting for us. Thanks, Ed, very much. Good piece.
Coming up, now that he's majority leader, how will John Boehner steer the House? I'll ask our Carlos Watson about which issues the new boss will push.
Up next, the political battle over domestic spying by the NSA. Who has the better strategy, Democrats or Republicans? Joe Lockhart and Bay Buchanan standing by. Stay with us.
(COMMERCIAL BREAK)
BLITZER: Welcome back. In today's "Strategy Session," the date is set for the start of the trial of former White House aide Lewis "Scooter" Libby. Which party will benefit more from the trial not starting until January of next year?
And one Democratic senator has tough words for his own party. Will they heed his call and fight harder against the president? Joining us now, former Clinton White House press secretary Joe Lockhart and Bay Buchanan, president of American Cause. Guys, thanks very much for joining us.
Here's what Ted Wells, Lewis "Scooter" Libby's lawyer, said in explaining why they need so much time to get ready. Listen to this.
(BEGIN VIDEO CLIP)
TED WELLS, LEWIS LIBBY'S ATTORNEY: The January 8, 2007, date will permit us the time we need to prepare Mr. Libby's defense. The defense will show that Mr. Libby is totally innocent, that he has not done anything wrong. And he looks forward to being totally vindicated.
(END VIDEO CLIP)
BLITZER: Joe, who benefits more, Republicans or Democrats, if anyone, from this delay in the start of this trial until after the midterm elections?
JOE LOCKHART, FMR. CLINTON PRESS SECRETARY: If you listen to Ted Wells, it would be, I guess, Democrats because he thinks he's going to be vindicated. I'm not sure it makes that much difference. I think marginally, maybe it helps Republicans, that right before the election this isn't being on the news every night.
But I think the real game -- that shoe has dropped on Scooter Libby. The real game is, what's Fitzgerald doing? Is there someone else in the White House? Is it Karl Rove, whoever. That could come between now and the election. That would have an pretty important effect on the midterm elections.
BLITZER: What's your take, Bay?
BAY BUCHANAN, PRESIDENT, AMERICAN CAUSE: I think it is beneficial to Republicans, because you never what's going to happen in a trial, you never know who's names are going to come up. And it starts putting a greater question. I think Democrats could go with a great distance on corruption if stuff started becoming muddier than it may be already. So I think it's very good for Republicans. I would like to see maybe Abramoff's moved till January, and yeah, the Republicans maybe get some Democratic trials going in June. I think all of that is to the benefit of who's out there right then.
BLITZER: You were the White House press secretary during the Clinton administration. There were plenty of problems: Whitewater and scandals as we all remember them. What should the White House strategy be this year in the face of this upcoming trial and the other scandals that are out there?
LOCKHART: You'll remember that during the heat of the Ken Starr investigation, which was 1998, we had a midterm election. In 130 years, no president in his sixth year had picked up seats. In probably the worst investigative scandal, the hysteria that was going on here in Washington, Democrats picked up seats.
The public has a sense of what's in their interest, what's happening for them. So I don't know that they're going to sit and vote on Scooter Libby. That's a problem, they worry about how classified information was used, they worry very much about these scandals and the special interest influence in Washington. But by and large, they're going to make their decision based on what's going on in their lives. And there are a lot of problems. If you look at the State of the Union address, they're kind of running out of patience with the president, who keeps saying, Things are going to get better right around the corner. And I think that's going to be the realm problem, as we come to the midterms.
BLITZER: Bay?
BUCHANAN: I happen to agree with Joe on this. I think there's a lot of issues out there that the president should be concerned about. Obviously the Democrats want to use this "culture of corruption" against Republicans. If they're successful, it'll work, because Americans do not like corruption, if they feel it's sided with one party over another.
But I think it's going to look like maybe both sides are fairly involved with this kind of corruption in Washington. So I think Joe's correct that the big issues are going to be, how's the Iraq war going? How's the job situation in this country? We know Ford Motor Company has laid off a lot of people. What's going to happen in those things? How are those people in Ohio faring, or Michigan? And I think that's what it's going to come down to.
BLITZER: That's what Bill Clinton did so successfully in '98. I covered the White House at that time. And, yes, he had Whitewater, Monica Lewinsky, all those impeachment issues certainly were roaring. But h focused on a lot of those bread and butter issues, and it certainly paid off.
Let's talk about Senator Evan Bayh. I think a lot of people recognize he would recognize he would like to run for president. He's thinking about it, he's acknowledged that. Had harsh words for his own party. Listen to this.
(BEGIN VIDEO CLIP)
SEN. EVAN BAYH (D), INDIANA: Some in my party are afraid of this fight. They urge that we change the subject to domestic issues that work better for Democrats. Others argue that it is wrong to inject politics into something as important as national security. I strongly disagree.
(END VIDEO CLIP)
BLITZER: He strongly disagrees. He's referring to the -- I guess the timidity among some Democrats to go head on and challenge the administration on the national security agency, the warrantless wiretaps, and other national security issues. Is he right?
LOCKHART: I think he is right. I think Democrats made a mistake in 2002 in trying to make it about just the economy. The public cares -- they can think. You know, they can walk and chew gum at the same time. They want to be safe and they want to be prosperous.
And Democrats have to do a couple things. One is push back on this sort of Karl Rove idea that somehow Democrats aren't as committed to protecting this country as Republicans. That's just wrong. Democrats are. But there's differences in how you do that. And we now have a five-year record of non-accomplishment as far as the administration where they've done things, where things haven't worked.
We went into a war without a plan for the peace, without a plan for the reconstruction, with troops without body armor, with non- reinforred vehicles, putting troops at risk. Democrats can go forward and say, "We're just as committed, but we can do it better."
BLITZER: Here's what Pat Roberts, the chairman of the Senate Intelligence Committee, said yesterday. "I am concerned that some of my Democratic colleagues use this unique public forum," referring to his hearings during the day, "to make clear that they believe the gravest threat we face is not Osama bin Laden and Al Qaeda, but rather the president of the United States." Those are pretty tough words from Pat Roberts.
BUCHANAN: They sure are. And obviously, he's upset that the Democrats are trying to make use of this. The problem the Democrats have though, Wolf, is they are all over the lot themselves on the issue of foreign policy, and in particular, Iraq. Whatever happens over there, none of us can control, not even our own military. And I think if it goes badly, goes south even more so than some people think it is now, there will be plenty of time for Democrats to pile on.
I happen to think, you know, when you listen to what Mr. Bayh was saying, he started talking about Korea's nuclear program. Now, that's a hot issue for off-year elections. I know that's just buzzing out there. North Korea, I'm sorry. The North Korean nuclear program.
This is not what Americans are thinking about. Iraq, sure. It's going to play. But I think if Democrats want to come with a good national security issue, they should look at the border. The president has failed to secure the border of this county. That is a hot issue in this country.
BLITZER: We'll leave it at that point. Bay Buchanan, Joe Lockhart, good "Strategy Session." Thanks very much.
No matter how John Boehner's stint as the House majority leader turns out, his election is giving political pundits plenty to talk about, especially here in Washington. Here's our senior political analyst, Bill Schneider -- Bill?
BILL SCHNEIDER, CNN SENIOR POLITICAL ANALYST: Backroom maneuvering, secret ballots, surprise results. Everything you could want in a political play of the week.
(BEGIN VIDEOTAPE)
SCHNEIDER: Three weeks ago, Roy Blunt claimed he had enough commitments from his House Republican colleagues to win the election for majority leader on the first ballot. But the Republican caucus votes by secret ballot. On the first ballot, Blunt ended up six votes shy of a majority. On the second ballot, John Boehner picked up all the dissident votes and won, somewhat to his own surprise.
REP. JOHN BOEHNER (R-OH), HOUSE MAJORITY LEADER: I feel like the dog who caught the car.
SCHNEIDER: How did Boehner do it? One of his competitors said...
REP. JOHN SHADEGG (R), ARIZONA: Let me make it very clear. John Boehner did run on a platform of reform.
SCHNEIDER: House Republicans are nervous about holding their majority this year in the wake of a widening corruption scandal. Is Boehner Mr. Clean?
BOEHNER: I have good relationships with K Street and people who -- lobbyists, both paid and unpaid.
SCHNEIDER: The answer is, cleaner than Blunt. Blunt was Tom DeLay's man, and had ties to Jack Abramoff. And while Boehner once gave out checks from tobacco companies on the House floor, Blunt is married to a tobacco lobbyist. Get the difference? House Republicans did.
Boehner was once Newt Gingrich's man. This year, Democrats are hoping to do to the Republican majority what Gingrich did to their majority in 1994. That would be big. Boehner was one of the architects of the 1994 revolution. So his colleagues figure, maybe he knows how to stop a counter-revolution.
BOEHNER: I think our members wanted, obviously, to make a big decision, and they did.
SCHNEIDER: Big enough for the political play of the week.
(END VIDEOTAPE)
SCHNEIDER: Many years ago, Democrat Morris Udall was defeated for House majority leader, even though he thought he had commitments from a majority of his colleagues. After the secret ballot, Udall of Arizona told reporters, quote, "I have learn the difference between a cactus and a caucus. On a cactus, the pricks are on the outside," close quote.
BLITZER: Thanks very much, Bill Schneider, with the play of the week. So now that he's got the job, just what will John Boehner do as the House majority leader? And how will he affect the midterm congressional elections? Carlos Watson's standing by, our political analyst. We'll have more on the story.
Plus, Bill Clinton lends a helping hand to Hurricane Katrina victims. We'll tell you what the former president is up to right now. Stay with us. You're in THE SITUATION ROOM.
(COMMERCIAL BREAK)
BLITZER: Another time-out in the fight over the Patriot Act tops today's political radar. The Senate last night joined the House in passing a five-week extension of the anti-terrorism law. It's the second time since December that Congress has extended the current act. Lawmakers are trying to end a battle over a bill that would make most of the law permanent while adding new civil liberties protections.
Former President Bill Clinton has found a way to try to aid survivors of Hurricane Katrina. His foundation is launching a campaign to make many storm victims aware that they can claim thousands of dollars in tax breaks or refunds by applying for what's called the earned income tax credit.
And as we head into the Super Bowl clash between the Seattle Seahawks and the Pittsburgh Steelers, the governors of Washington State and Pennsylvania have placed their bets.
Washington's Christine Gregoire is putting up an array of her state's tastiest treats, including bushels of homegrown apples and clam chowder. Pennsylvania Ed Rendell is betting a box of wieners from Pittsburgh's original hot dog shop, and a case of Heinz ketchup and other condiments to go along with it. The loser will pay up to homeless shelters in the winning state.
Coming up, what's on John Boehner's to-do list? We'll examine the House majority leader's political priorities.
And it sounds like a B movie plot line, but it's very real and very deadly. Killer bees on the loose right here in the United States. The story in our 7:00 p.m. Eastern hour, right here in THE SITUATION ROOM.
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BLITZER: Welcome back. The new House majority leader John Boehner is calling economic freedom one of his top priorities in his new post. Let's bring in our political analyst Carlos Watson to talk a little bit about John Boehner.
Now that he's the majority leader, what do you suspect, Carlos, he's going to be pushing most?
CARLOS WATSON, CNN POLITICAL ANALYST: Wolf, three big items. And interestingly enough, while some people see John Boehner as a political boon for the president, more significantly, he could be a policy boon. What do I mean?
I mean in terms of education reform, pension reform, and healthcare reform, three things that the president has called part of his opportunity society agenda. John Boehner has actually been a leader over the years in pushing those kinds of reforms, and could actually be really helpful to the president in getting that going.
Remember that Tom DeLay was a big help to the president on tax cuts and on social conservative issues, including the Schiavo incident. But when it comes to education, healthcare, and pension reform, look for John Boehner to make a big difference.
BLITZER: So does he help or hurt the Republicans going into the midterm elections?
WATSON: You know, I think that's a big question. I think he'll likely help. I think he'll help if, number one, in terms of keeping the base and getting the Republican base very excited, making 90 percent of them or so vote for candidates, that will happen if he shows that Republicans are willing to cut the deficit.
And so you hear a lot about earmark spending and preventing legislators from being able to put their pet projects in. If he's able to pass legislation on that, that will be a big deal.
And number two, in terms of reaching out to independents, if he does a John McCain, meaning having once been tarnished a little bit with ethical scandal but now coming clear to the other side and pushing hard for ethics reform, if indeed he does that, it certainly will help Republicans who are in those swing districts.
BLITZER: I know you've been looking into this whole issue of trial lawyers. They've been pretty powerful over the years, largely supporting a lot of Democrats. They've been on the defensive to a certain degree because of the Republicans. What are you picking up?
WATSON: Well, you know, scertainly trial lawyers have played a big role in our politics, not just over the last couple decades, but going back to Abraham Lincoln, a famous trial lawyer. And for us, they've meant everything from safer cars to the Dalcon (ph) shield case, safer health, to even pajamas that won't go on fire. So they often have done things that politicians won't do.
The 2004 trial lawyers were very close to Democrats, had what seemed to be a high water moment when John Edwards, one of their own, got named to the ticket. But last year was one of the toughest years they've had, whether it was on the medical malpractice, whether it was on class action lawsuits and the ban the president -- or the limit the president put on that. On bankruptcy, they've had a tough time.
And so, a couple of interesting things to watch, Wolf. Number one, they've started to supports Republicans a little bit more. You see it in Texas where trial lawyers are most prominent. But you also see people like the former Republican senator Al Demato (ph) joining a noted trial lawyer group.
Number two, you also see them quietly beginning to spend more money on Democrats. And so, in fact, as we go into 2006, if Democrats have some success in taking back either the House or the Senate, it may be because these trial lawyers who got beat up last year come back ready to spend a lot of money and a lot of energy in turning out some Republican incumbents. So dual strategy. Interesting group to watch.
BLITZER: Pittsburgh or Seattle?
WATSON: You've got to love the bus, Jerome Bettis, and you've got to hope that he goes for over 100 yards. But I'm going to give it to the MVP, Shaun Alexander. I think Seattle's going to win by ten points.
BLITZER: I have gone on the Record. If you're interested, I'll tell you what my prediction is.
WATSON: Please tell me.
BLITZER: 21-17, Pittsburgh.
WATSON: 21-17. That's a tough one for a guy who loves the Cleveland Browns to agree to. So I'm going to stick with Seattle, say that Seattle wins 31-21.
BLITZER: Let's see. We'll all watch, and we'll enjoy. Thanks very much, Carlos Watson.
WATSON: Take care.
BLITZER: We'll talk next week.
Up next, a walk in space. Minutes from now, a major cosmic collaboration between Russians and Americans in the outer reaches from Earth. We'll tell you what's happening.
And in our 7:00 p.m. Eastern hour, inside the mind of a suicide bomber. We'll show you what they think about their merciless missions and show you some amazing images on how they plan their terrorist tasks. Our Mary Snow has got an incredible report you won't want to miss. That's at 7:00 p.m. Eastern, here in THE SITUATION ROOM.
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BLITZER: Let's check back with Fred for another look at some other stories we're following right now -- Fred?
WHITFIELD: Hello again, Wolf. In New York State, sheriff's investigators have found no criminal wrongdoing in a deadly tour boat accident last October. Twenty elderly tourists died when the Ethan Allen capsized on Lake George. The Warren Country Sheriff's Office is now turning the matter over to the district attorney's office.
Terror suspect Jose Padilla may not have to wear handcuffs or ankle chains during court proceedings in Miami. A federal judge says prosecutors must first show he's a safety threat. The judge adds Padilla needs to take notes in court. He and four others are charged with providing support to terrorists.
So far, so good. That's what officials in Asia and Europe are saying about a computer worm timed to strike today. They say it's caused relatively little damage, possibly because there was enough advance notice about the so-called Kama Sutra worm.
In less than an hour from now, a U.S. astronaut and a Russian cosmonaut are going on an unearthly journey. They're heading outside the international space station for a six-hour spacewalk. They'll also toss a space suit stuffed with a radio transmitter into space. We'll explain what that's all about when we have live coverage next hour in THE SITUATION ROOM. And that's at about 5:20 p.m. Eastern Time -- Wolf?
BLITZER: All right, Fred. Thank you very much.
Meantime, let's quickly check in with our Internet reporter Jacki Schechner, who's monitoring this NASA space mission online -- Jacki?
SCHECHNER: Yes, we're keeping an eye on it, Wolf, and you can too at home at Nasa.gov. They have a streaming cast telling you all about what this is going to be. We can also show you what the spacesuit's going to look like. You can see the radio transmitter there on the head of the spacesuit. That's kind of cool.
And also, we're going to show you, coming up at 5:00, how you can track this thing yourself online. You can find out where it's going to be when. Also, you can listen to the radio transmissions coming down to you from space -- Wolf?
BLITZER: Thank you very much, Jacki Schechner.
And this just coming into CNN from the Egyptian Transportation Ministry. They now say that 314 people have been rescued so far from that ship disaster in the Red Sea. About 1,400 people were on board, 1300 passengers, about 100 crewmembers; 314 people so far have been rescued.
This according to the Associated Press, citing a spokesman for the transportation ministry in Cairo. We're going to have a live report. We're going to go there live to Egypt at the top of the hour, bring you the latest. If they've rescued 314 people, there's still 1,000 or so still missing, maybe more.
Still to come, the price of the war in Iraq. Should there be a limit on how much the United States spends? Jack Cafferty back in a moment with your email.
And in our next hour, who's setting Alabama churches on fire? The latest on the damage and the investigation. That's coming up in THE SITUATION ROOM in the next hour.
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BLITZER: Want to update you on a political note. It's official, now. Mitch Landrieu, the lieutenant governor of Louisiana, is going to challenge Ray Nagin for the mayor's job in New Prleans, the primary coming up in April. Mitch Landrieu deciding that he wants to be the mayor of New Orleans.
Among other things, he said this: "If elected, I commit to serve with integrity, candor, and courage. As mayor, I will represent all of our people, not any one party and any one faction, nor any one political ideology." Mitch Landrieu will challenge Ray Nagin for mayor of New Orleans. We'll watch that story.
In the meantime, let's go back to Jack in New York with "The Cafferty File."
Hi, Jack.
CAFFERTY: How you doing, Wolf? Has Nagin said he's going to run again?
BLITZER: Yes.
CAFFERTY: He has? I'm not sure after all the flack he's taken -- I might consider, you know, doing something else. Tough job he's had.
BLITZER: I think he wants to stay on and finish the job. I think that's -- he said things along those lines.
CAFFERTY: All right. I must have missed that.
President Bush is going to ask Congress for another $120 billion to pay for the wars in Iraq and Afghanistan. That will bring the total spending since the 9/11 attacks to $440 billion. The question is, is there a limit to how much the U.S. should spend on the wars in Iraq and Afghanistan? Here's some of what you've written us.
Bill in Alexandria, Virginia writes, "I believe the amount of money spent on Iraq and Afghanistan should match, dollar for dollar, the amount being spent on Katrina victims and New Orleans cleanup and rebuilding."
Mike in San Antonio, Texas: "What an idiotic question. I guess we would just drop everything once we reach a pre-set limit. How can we put a price on the lives that have been lost and saved in these wars?"
Pat writes in Ketcham, Idaho, "The question isn't whether there should be a limit on how much to spend in Iraq, but whether anyone in the Congress has the stomach to even tell Bush enough is enough."
Al writes, "Not if you're part of the military industrial complex in this country. All of those companies and people enrich themselves because the more wars we fight and the longer the wars go on, the better it is for all those military-related businesses. War is big business."
Dale writes, "Wars are much more expensive than in the past because of the technology used. I bet the enemy can put up $10 tents faster than the U.S. military can drop $100,000 bombs on them."
And Chris in Pensacola writes, "Absolutely not. If this president wants unlimited power, I say we should him run us into bankruptcy. It'll be a funny story to tell our grandchildren when they labor away in sweatshops that the Chinese will be making here" -- Wolf?
BLITZER: Did you ever think, Jack, that when this war started in March of 2003, that, what, almost three years later, the U.S. would be spending about a billion dollars a week, more than $300 billion so far, to continue this operation?
CAFFERTY: No. And the bulk of the combat operations were over in about an hour and a half. Remember? I mean, we swept across that country, took Baghdad. I mean, it was all wrapped up nice and tidy, we thought. And now, three years later, we're still fighting and dying, and the tab just keeps running. It's something I sure wouldn't have predicted.
BLITZER: You think that anyone also thought -- given the casualties from the first Gulf War when the U.S. liberated Kuwait, relatively modest in the low maybe 150, 200 casualties, the best of my recollection -- anyone thought that more than 2,000 U.S. troops would die in this war?
CAFFERTY: No, but casualties during the first couple of weeks when the bulk of the combat was fought. Those casualty numbers were very, very low. It's, you know, that constant, you know, two or three a day from these improvised explosive devices and the activities of the insurgency that have caused the body count to increase over time.
But initially, when we went in and took control of the country, we didn't lose very many people at all.
BLITZER: It was a relatively, relatively low number. Jack, thanks very much. We'll get back to you soon.
It's just before 5:00 p.m. here in Washington, and you're in THE SITUATION ROOM, where news and information from around the world arrive at one place at the same time.
Happening now, it's early Saturday morning in the Red Sea, where an aging passenger vessel sinks with 1,400 people on board. Most still unaccounted for.
Across the Muslim world, angry protests and chilling threats over the publication of cartoons showing the prophet, Mohammed. Is it a matter of free speech, or is it blasphemy?
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