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Interview With Former Labor Secretary Robert Reich; Obama Makes History With Attorney General Pick

Aired November 18, 2008 - 20:00   ET


It was the top story on Capitol Hill today. Top bosses of America's car companies tried to explain why they needed a $25 -- or $25 billion, rather, government bailout. We are going to get into that in great detail tonight.

But, first, we have got some breaking news to tell you about. Sources tell CNN that Eric Holder is president-elect Obama's choice now to be attorney general. Holder was deputy attorney general in the Clinton administration.

CNN has confirmed that Holder has told the Obama team he will accept the job. So, at this moment, all that appears to be standing in his way is the vetting process.

We want to go right now to White House correspondent Ed Henry, who is with Obama and his transition team out in Chicago. And Ed has been working his sources on this.

And, Ed, Holder was always on the short list. But we had heard a lot of other names, Janet Napolitano, governor of Arizona, being batted around. Tell us how it came to Holder, how all of this went down.

ED HENRY, CNN WHITE HOUSE CORRESPONDENT: Campbell, a very dramatic surprise for a lot of Democratic insiders, because you are right. They thought Janet Napolitano, the Democratic governor in Arizona, really had the inside track on this job.

But as we have pieced this together, Obama insiders say that Eric Holder really caught the attention of Barack Obama when he was co- chair of the vice presidential vetting process. This was the guy, a very powerful Washington attorney, who had to get behind closed doors with all these perspective V.P. nominees and ask them for all their deepest, darkest secrets, whether they had extramarital affairs, finances, put it all on the table. We need to know it.

Very discrete, very careful with all that information, obviously, very potentially explosive information, and then sit down with the candidate himself for hours in some cases and lay out for Barack Obama very coolly and calmly the pluses and minuses for these various nominees. And that's where he really caught Barack Obama's eyes, we're told.

This is also going to be history-making, of course, the first African-American attorney general, chief law enforcement officer in the nation. That's going to be dramatic. And then finally, a lot of people in the Democratic Party were expecting maybe Barack Obama would turn the page on all of those Clinton insiders. But instead he is turning once again to somebody who was a senior Justice Department official under Bill Clinton -- Campbell

BROWN: And give us a little more on his background. There's certainly been some pretty controversial A.G.s recently. What do we more beyond his role as deputy attorney general about Holder?

HENRY: One big thing you need to know right now, this is going to going to be a flash point in his Senate confirmation hearings, about the fact that he was in charge essentially at the Justice Department when Marc Rich was pardoned. And there were a lot of other controversial pardons at the end of the Clinton administration.

But the fugitive financier being pardoned was the one that really caught so much flak, really, so much criticism. He did not get blamed for pushing it through, but he sort of got blamed for not stopping it, not preventing President Clinton from pushing that pardon through.

He's going to hear a lot of flak about that. But I think, by and large, what we are hearing from Capitol Hill, especially the chairman of the Senate Judiciary Committee, who will be in charge of this, Pat Leahy, just put out a statement in the last few moments saying this is a highly respected person. He was a prosecutor. He was a judge. He's respected on both sides of the aisle. And Patrick Leahy is predicting that if in fact he is picked, it's going to be smooth sailing in the Senate.

And I think that coming on the heels of Alberto Gonzales in the Bush years, all these charges of cronyism and incompetence, frankly, at the Justice Department, this is somebody who might be considered an A-1 pick in the United States Senate there -- Campbell.

BROWN: Ed Henry for us tonight from Chicago with all the details -- Ed, thanks very much.

Joining me right now to take a closer look at Eric Holder, plus some of the other developments today as president-elect Obama begins putting his team in place, we have got senior political analyst Gloria Borger, CNN contributor Steve Hayes, a senior writer for "The Weekly Standard," and CNN political analyst and radio talk show host Roland Martin joining us.

Welcome, everybody.


Gloria, start us off. What does pick tell you about the kind of attorney general that Obama is looking for?

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: I think he's looking for somebody with experience, Campbell.

I think he's looking for somebody that he's personally comfortable with. Being attorney general is a very, very important job in an administration. And he's also looking for somebody who is eminently confirmable. And as Ed Henry was just saying -- I was talking to folks on the Hill today. This is a White House that has raised Eric Holder's name with both Democrats and Republicans on the Hill.

And the message they were getting back is, yes, there is this problem with the pardon for Marc Rich. But Eric Holder has already publicly stated that he needed -- he should have handled that a little bit differently. But I don't think that there about were any red flags raised about Eric Holder, and that's important for Barack Obama. He does not want to get stuck on his nominees, like Bill Clinton did.

BROWN: And, Roland, you have now got -- Ed Henry made this point a second ago. You have now got Rahm Emanuel, Greg Craig, Holder all joining the Obama team, along with a lot of other former members of Bill Clinton's administration who are already in transition roles.

For somebody who campaigned so heavily on changing Washington, Obama's White House beginning to look an awful lot like Bill Clinton's to a lot of people.

MARTIN: There's a difference between changing Washington with policy as opposed to people.

If you are a Democrat, you are naturally going to go after those people who were in the subcategory or the subjobs when Clinton was president. You do look to the previous administration for the kind of experience.

Now, look, I was saying back in June that Eric Holder was likely going to get the A.G. job. There was a lot of issues there because he has young children. He was doing very well in private practice. He spent so many years in public policy. His wife really wasn't quite sure about going back into the public arena.

And so Obama has been looking at Eric Holder not recently, but as far back to the summer. So it is no surprise that Eric Holder would do this. But beyond Marc Rich, Campbell, he also played a critical role in civil rights cases, bringing in Deval Patrick. Cases that were dormant under Reagan, he brought those to the fore under Bill Clinton. That was also critical to this appointment.

BROWN: Steve, what do you make of how he handled the Marc Rich pardon? And do you think Republicans might focus on that, try to turn this into a messy confirmation process?

STEPHEN HAYES, CNN CONTRIBUTOR: Yes, I think that's a possibility. I made some phone calls this afternoon, when it looked like Eric Holder was going to be named, talked to some Republicans in the Senate, who said in effect it is too early to tell whether we are really going to make this a stink, but there is certainly some material there.

You have got the Marc Rich pardon, which you mentioned, where his job basically was to notify the White House about some objections to careerists at the Justice Department, which he didn't do. And as I think Gloria pointed out, he said that he didn't handle that very well.

There are some other questions about how he handled pardons of terrorists that caused a problem for Bill Clinton, you know, eight years ago, could cause Eric Holder a problem I think going forward in these confirmation hearings.

I think Republicans are studying his resume, reading the clips back from newspapers eight years ago to figure out exactly how hard they want to fight.

BORGER: But Republicans have to pick their fights on these nominees. And, you know, it would seem to me by looking at Eric Holder, that he wouldn't be the fellow that they would really pick a fight with, because he's so well regarded in Washington, that Republicans might do it at their own peril.

MARTIN: Absolutely.


HAYES: Well, I think it depends who else is nominated.

BORGER: Right. Exactly. Exactly.

HAYES: They are ready to make I think some fights, or at least have some contrasts, and say look this is not the person we would have picked. We would be doing things differently. And if there are others that are better suited to help them make that case, I think Republicans might choose chose.


So, the counter to that, though, Steve is a choice that is getting resounding endorsements seemingly from so many Republicans, which is Hillary Clinton, who is potentially now on deck for secretary of state.

Still getting an enormous amount of attention today. Why is it that you have -- literally, I have yet to hear one Republican say it is a bad idea. They are rallying behind her.

HAYES: Because conservatives have always loved Hillary Clinton. Don't you remember back in the day?


BROWN: Yes, exactly.


HAYES: No, I think -- well, for one thing, it will keep conservatives in business for a while. I think they are likely to -- first of all, I think, on serious note, they think that she will do a decent job. I think one of the things she did when she came to the Senate was study up on foreign policy, study up on national security, and truly made herself an expert. And I think even people who disagree with her policies can agree that she did that.

On the other hand, I think there is some intrigue there. I think there will be likely be lots of stories coming out if she is in fact chosen and she accepts about, you know, what she thinks on foreign policy, where she differs from Barack Obama. She is very ambitious. I expect that the State Department beat for reporters in Washington would be a very interesting one.


MARTIN: Hey, Campbell, you also have many Latino leaders who have really been working behind the scenes, pressing the transition team about Bill Richardson.

And let me tell you something. African-American and Hispanics have been looking at Obama's appointments. And, look, let's just be honest. Many of the folks who have been appointed thus far who are being talked about are all white, very few African-Americans and Hispanics.

And so people -- the Eric Holder possible appointment or even Bill Richardson would sort of keep those folks quelled a bit. But, trust me, it has been bubbling below the surface that, wait a minute, look, you got major support. What's going to happen with these high- level appointments? Obama is facing that pressure as well.


BROWN: Go ahead, Gloria.

BORGER: But that's the whole reason the Obama transition team is trying to hold all these appointments, perhaps except for the Treasury or the economic team. Perhaps we could get that as early as late this week.

But the rest of the appointments, you have to kind of see how the group looks. So, they don't want to say, well, we are going to appoint this person here and that person there, because they have to take a group photograph and they want to see where they are all coming from. So you can't rule out Bill Richardson for a job, for example, because they might feel that they want to put him in a prominent role.

BROWN: Right. All right.

BORGER: And that's why they didn't want us to know about Eric Holder either.

MARTIN: Very true.

BORGER: All right, guys, we are going the leave it there. Gloria, Steve, Roland, many, many thanks.

Coming up next: bailing out everybody. Today, it is the auto industry's turn to ask for a handout.


RICK WAGONER, CHAIRMAN & CEO, GENERAL MOTORS: Our industry, which represents America's real economy, Main Street, needs a bridge to span the financial chasm that has opened before us.


BROWN: So, would that be a $25 billion bridge to nowhere? We are cutting through the bull on that one when we come back.

And, then, later, we are going to hear an 8-year-old suspect tell police he shot and killed two men, including his father. But is he even telling truth? And why is he being pressed and questioned without a lawyer? We will get into that.


BROWN: Now we are going to get to the day's big news from Capitol Hill.

The heads of Detroit's car companies, Ford, Chrysler, GM, bumper to bumper, begging Congress for a bailout. We are going to start, though, cutting through the bull, and talk a little bit about how the automobile companies got into this mess.

Number one, Americans finally starting to turn their backs on those 12-mile-a-gallon SUVs. Yes, it took us long enough, but we are finally starting to get it. Now, I know gas prices have fallen back into the $2-a-gallon range. But we all remember what it cost to fill up last summer, when gas was $4 a gallon, and we all know that those days will come again, which brings us to problem number two.

Why isn't Detroit making what we want to buy now or what we should be buying now? Where are the hybrids? Where are the batteries? Where are the cars that get 70 miles a gallon? You automakers fought tooth and nail against proving fuel-efficiency standards for years. You say all these new things are in the pipeline. You say we are going to get a 40-mile-a-gallon car in 2020. Americans need them now.

And that brings us to problem number three, ignoring the competition. It seemed at times like American carmakers think that car buyers are so blindly loyal, we will keep coming back, despite the sticker shock for crummy cars that guzzle gas, that fall apart too soon, and cost too much to repair. Lots of other companies have figured out how to build better-quality, more fuel-efficient cars, and even do it right here in the U.S., which is problem number four, greed.

GM chief executive Rick Wagoner gets almost $9 million a year. Some union markers get $30 to $40 an hour, plus benefits. Retirees get pensions, health benefits that would make pretty much anybody jealous. You guys spend millions of dollars a year lobbying to keep everything the same way it is, and now you are asking the taxpayers for $25 billion.

Now, I don't know if a government bailout will rescue America's auto industry. But I do know, if there is a bailout, it better come with a big bright stop sign and a whole lot of strings attached.

Now, to be fair, just a few hours ago, GM chairman and CEO Rick Wagoner told the Senate Banking Committee none of that, none of those things are the real problem here. Let's listen to what he said.


WAGONER: I do not agree with those who say we are not doing enough to position GM for success. What exposes us to failure now is not our product lineup, is not our business plan, is not our employees and their willingness to work hard, it is not our long-term strategy.

What exposes to failure now is the global financial crisis.


BROWN: So, do you think Detroit's big bosses get it?

We want to ask our chief business correspondent Ali Velshi, who actually talked with Ford's CEO this morning.


BROWN: Ali, address first what we just heard from Wagoner. Is he right, or...

VELSHI: I spoke to Rick Wagoner at plant in Ohio a few weeks ago, where they were unveiling a new car. I think he is right to a point.

Right now, the problem facing the auto industry is that they can't get credit. They are in trouble. And buyers can't get credit. I got the same message from the CEO of Nissan the other day. They have got a real problem because of this credit environment.

The problem is, what did they do until now? The last five years have been problems. They have taken some major steps. They didn't take enough steps and they got caught.

BROWN: And too late, right?

VELSHI: That's exactly right.

BROWN: So, what's the guarantee, if they get this bailout, that they are not going to be back asking for another $25 billion or another $50 billion or whatever? There are so many people you hear saying that this is just a drop in the bucket.


VELSHI: Yes, there was a time when $25 billion was a lot of money. That's before we had a $700 billion bailout. Let me tell you, back in September, it kind of got lost in the shuffle, but there was a bill that was passed allowing the government to loan the auto companies $25 billion, under strict conditions that they use that money to retool and become more fuel-efficient.

This is different. They are asking for $25 billion out of the $700 billion. I spoke to Alan Mulally, the CEO of Ford, this morning in Detroit before he went to testify. And I said -- I asked him that very question. What is going to change?

Here is what he told me.


ALAN MULALLY, CEO, FORD MOTOR COMPANY: Part of the -- the condition of us accessing this money, if we need it, is that we would show the government that we have a viable business plan.

What that means is, as we all know, is that you have products that people want and they value, that you have a cost structure that is competitive, that your quality and your safety and your fuel mileage is competitive. And then you have a plan over time to increase your profitability and actually keep investing in new products.


VELSHI: He's right on a lot of levels. They have improved their quality. In fact, real measures of quality show that these American cars are doing well. The Malibu from Chevrolet car of the year. The Silverado is a great truck. Ford F-150 been the bestselling vehicle in America for more than 30 years. They have just introduced a new one.

They know how to make cars people like. They just haven't been building those in fuel-efficient models. If GM gets its Volt out there, the Chevy Volt, that thing could have 100 miles a gallon. They have the technology. They need to get it out there and sell to it people, like you just said.

BROWN: Now, it is still a big sales job for taxpayers.


BROWN: We recognize that giving them the bailout you are going to save a whole bunch of jobs. But how do you say -- or how do you explain to people who aren't directly tied into the automobile industry in some way that they're going to get something out of this? They are going to get their money's worth?


VELSHI: Yes. And I again put that to Alan Mulally. Will people get their money back?

They feel -- the automakers feel that they have been struggling towards this line for a long time. They were almost there, like a thirsty man going for water. And they're almost there and something has set them back.

So, they feel that if they get this bridge, by 2010, they can be back in business doing well -- 2009 will be really bad, but they actually feel they can be profitable. There's no point in investing this money if they are not going to be profitable. Then rather just pay the workers to stay...


BROWN: Do you believe them?

VELSHI: I remain conflicted about this one. I think there are a lot of...


BROWN: Thank you for being honest.

VELSHI: I think there are a lot of jobs at stake. And that, as you know, has always been my biggest concern.


VELSHI: If one of these companies fails, there could be hundreds of thousands of people out of jobs. That's what I lose sleep over.

BROWN: With an enormous ripple effect through the economy.


BROWN: Ali Velshi for us tonight making it as simple as he can possibly make it, given when we are dealing with here.

Ali, thanks.


BROWN: So, no bull here. Should we lend billions of dollars to the car companies or let them go broke? A lot of people say do let them go broke.

And what's the Obama administration going to do for the rest of us? In a minute, I will ask former Labor Secretary Robert Reich, who is on the transition team, advising him. He's going to be here with us in just a second.

And then, later, Senate Democrats decide whether to punish McCain supporter Joe Lieberman. Find out what happens. We have got it in the "Political Daily Briefing" segment, the "PDB."

Plus, an 8-year-old little boy tells police he shot and killed two men, including his father. We are going to ask attorney and truTV anchor Lisa Bloom if we can believe what we are seeing and hearing in this confession tape when we come back. (COMMERCIAL BREAK)

BROWN: So, first, we had a mortgage foreclosure crisis. Then we had a banking crisis. And, about an hour ago, we got this very dire warning about the automobile crisis. What could happen if America's car companies don't get a government bailout and instead go bankrupt?

This is GM's CEO again from earlier today.


WAGONER: This idea of a prepack bankruptcy is pure fantasy. If you're talking...


WAGONER: Excuse me. You'd be talking about a Chapter 7 liquidation...


WAGONER: ... which would affect the supply base, affect the other two, and ripple across this economy like the tsunami that we haven't seen, and it seems like to be a huge roll of the dice.


BROWN: So, short of rolling the dice, what can the Obama administration do to help here?

Former Labor Secretary Robert Reich has written several books on enemy combatant policy. His latest is "Supercapitalism: The Transformation of Business, Democracy, and Everyday Life." He's a member of president-elect Obama's economic transition team, an adviser. And we should mention the views he's sharing with us tonight, though, are strictly his own.

And, Mr. Secretary, welcome back.

I know, last time you were on, we ran out of time. And I wanted to talk about this subject. So, we are bringing you back to put you on the hot seat once again. Thanks for being here.

ROBERT REICH, FORMER LABOR SECRETARY: Good. Good evening again, Campbell.

BROWN: I don't have to tell you -- let's get straight into it -- that there are a lot of very smart people out there who say, you know what? Let the automakers die. The time has come. They are dinosaurs. We are throwing more good money after bad. They can't be saved.

How do you respond to that?

REICH: Well, to some extent, they are absolutely right. The normal process when a company is going down the tubes and or even an entire industry is called Chapter 7 or Chapter 11 of bankruptcy. They are different. Chapter 7 is liquidation. That is, you just basically roll up the carpets and you sell off everything and you pretend that it never happened. You just go home.

Chapter 11 is more interesting. that is reorganization under bankruptcy. That means everybody makes some sacrifices. Creditors and shareholders and your employees, and your executives, everybody puts some money into the common kitty in order to keep going.

And what we may see and perhaps the best way of coming out of this, given that you have so many jobs -- I mean, the estimates are millions of jobs at stake -- what we may see is some combination of Chapter 11 and a bailout. Call it a Chapter 11 bailout, in which all stakeholders put some money in. Everybody makes some sacrifices. Taxpayers also put some money in.

And out of it comes a very new American auto industry, something that's not only fuel-efficient, but also very competitive.

BROWN: But isn't it -- and, look, you are the expert here. It just seems like it is much more complicated than that, that that is a little Pollyannish to say that it's going to work out that way.

I mean, we know that part of the challenge comes down to union costs. It is much, much cheaper for a Nissan or a Toyota to make cars in non-union factories down South than it is for Detroit. Can this bailout package force automakers to truly compete, to tear up those union contracts?

REICH: Well, in the Chrysler bailout of the early 1980s, there was a concession, major wage concession by the unions. And I think if this is going to work, you are going to have to have similar wage concessions.

Now, the UAW did make major concession last year. And, in fact, the hourly wage of the new workers coming in to the big three is not all that different from the hourly wages of Americans working for Nissan or Toyota down South.


BROWN: But that's just new employees. I mean, they still have these legacy costs.

REICH: Yes. There are legacy costs.

But, again, the new contract that the UAW entered into does deal to some extent with those legacy costs. But I think, undoubtedly, if there is going to be taxpayer bailout, that we're going to have to ask more -- for more concessions from the UAW, but also from executives. Look at these executive salaries. They're totally out of control. Look at creditors. Creditors will have to take a haircut. Shareholders have to take even more of a beating. It will look a little bit like Chapter 11 reorganization under bankruptcy. But, again, given that there are so many jobs at stake, an estimate that I just looked up, the Bureau of Labor statistics, is 3.1 million jobs directly or indirectly related to automobiles, Campbell -- and you have about $400 billion in personal income. You can't just pretend that this industry is like everybody else.

BROWN: So, put this in context in terms of the big picture, and prioritize, because, you know, every day we are hearing how bad the economy is, the crisis we are in. Is this number one on president- elect Obama's list, or should it be, in your view, once January 20 rolls around?

REICH: Well, I suspect -- and, again, I'm speaking only for myself -- that the number-one priority for president-elect Obama is to get the economy running again.

And that means doing something about the credit crisis. That means maybe a major sort of stimulus package that gets jobs going, not only in the auto industry, but for all industries, also gets money in people's pockets, a tax cut for the middle class.

I mean, all of these things are things that president-elect Obama has talked about. But, undoubtedly, there has to be a lot going on. And there will be a lot going on after January 20, because the economy has not been in such bad shape. It is not just the automobile industry. I mean, industry by industry, everybody is hurting very, very deeply.

The only thing that makes the auto industry slightly different is not only the number of jobs at stake, but also it is not just this recession. The auto industry, at least the American automakers, have been going downhill for years, for decades.

In 1960, 90 percent of the cars on the roads were the big three cars. Now, today, over 50 percent of auto sales in the United States are non-American-made cars.

BROWN: All right, and there's good reason for that, I think, which is why we are having to see them make major changes in order to make all of this work.



REICH: It is an opportunity for major, major restructuring, major change, but will they take the opportunity? Will they see it as an opportunity? That's the question.

BROWN: Secretary Reich, appreciate your time tonight. Thanks again.

REICH: Thanks, Campbell.

BROWN: When we come back: the "Political Daily Briefing." Dana Milbank has the story of a politician who can't seem to understand that she lost.

Also in the "PDB," John McCain goes back to work in the Senate. How is that going to work out for him? We will talk about it.

Plus, the Obamas in Washington -- mom and the girls go shopping for a new school.


BROWN: Time now for our PDB, the "Political Daily Briefing" with CNN contributor Dana Milbank, national political correspondent for the "Washington Post."

And, Dana, after nearly two years on the campaign trail, John McCain returns to his day job today. Tell us about it.

DANA MILBANK, CNN CONTRIBUTOR: You know, there's a gracious way to lose, Campbell, and then there's then an ugly way to lose, and John McCain is pursuing the gracious way. Sort of a lovely concession speech goes out to Chicago to see Obama and then returns with no fanfare at all to Washington today.

Now on the flip side of that, you've got Congresswoman Marilyn Musgrave, a Republican out of Colorado. She lost her re-election bid by 12 points. It's two weeks later now. Still hasn't called to concede or even acknowledge that she lost the race. But I think it's not too late.

As a public service to her tonight, let's give her the number. It's 202-224-3121. That's the Capitol switchboard. Ask for Congresswoman-elect Betsy Markey.

BROWN: Twelve points and she's still hanging on? You got to give her a little credit for that.

MILBANK: She's keeping hope alive.

BROWN: Today, also, Dana, it became official but despite supporting John McCain, despite saying some pretty nasty things about Barack Obama on the campaign trail, Senator Joe Lieberman is going to keep his coveted chairmanship of the Homeland Security Committee.

MILBANK: It's amazing. Looks like a full amnesty for Joe Lieberman. He said some awful things about President-elect Obama. And now he gets -- I don't think you could even really call it a slap on the wrist there, and in fact, to thank his colleagues for keeping on board. He went out and gave this very carefully hedged mea culpa after hijacking the Democratic leader's press conference.


SEN. JOE LIEBERMAN (I), CONNECTICUT: Some of the statements -- some of the things that people have said I said about Senator Obama are simply not true. There are other statements that I made that I wish I had made more clearly. And there are some that I made that I wish I had not made at all. And, obviously in the heat of the campaigns that happens to all of us, but I regret that. And now, it's time to move on.


MILBANK: Well, the Democrats may look a little bit wimpy for their behavior here but unfortunately for them, the Republicans are looking no better. They met today to decide whether to kick out Ted Stevens over his felony conviction to decide, you know what? Let's take this up again in a couple of days.

BROWN: God, it's so cynical. Every vote counts.

And finally, the story that caught a lot of our eye. So many convicted felons who want to be pardoned by President Bush before he leaves office, there's apparently a backlog of at least 2,000 pardon applications.

MILBANK: Yes. It sort of has the feeling of the last helicopter off the embassy roof in Saigon. There are 2,300 people quite literally begging the president's pardon right now. This is the most in more than 100 years.

We've got everybody from the former congressman, Duke Cunningham to John Walker Lindh. Interestingly, not yet Scooter Libby, not yet Ted Stevens. Still time for them though. And there's also talk that maybe the president would just want to sort of get everything out of the way, give everybody in the administration a blanket preemptive pardon.

BROWN: All right. Dana Milbank for us tonight. Dana, thanks.

MILBANK: Thanks, Campbell.

BROWN: And still to come this evening, the 8-year-old in Colorado who has been charged with murder. He has questions to answer and so do the local police.


BROWN: We'll move on now to one of those stories that makes you catch your breath and shake your head because it's upsetting however it plays out. And it can only play out in one of two ways. Either there is an 8-year-old murderer in custody tonight in Arizona or the authorities there have done a little boy a grave injustice. And come to think of it, both of those things may actually be true.

This report now from Deborah Feyerick begins with a couple of officers questioning the boy without a lawyer and without his mother. Listen.


DEBORAH FEYERICK, CNN CORRESPONDENT (voice-over): When the two officers started questioning the 8-year-old boy in an interview room, police say they thought he may have witnessed a double murder at his house.

OFFICER: You saw a car driving fast and tell me about that car.

CHILD: It was kind of like my grandpa's car except it had no rims. It had kind of like black rims.

FEYERICK: The child told officers he had come from school and walked ten times around the block before going home.

CHILD: And I saw the door open and I saw (beep). And I ran and I said, Dad, Dad, and then I went upstairs and tried to call him.

OFFICER: And you saw him? OK.

CHILD: And there was blood all over his face, I think. And I think I touched it.

OFFICER: You think you did touch it? What did you do when you touched it?

CHILD: I just kind of checked if he was a little bit alive.

OFFICER: You checked if he was a little bit alive? OK. And how did you do that?

CHILD: I kind of just went like that.

OFFICER: With your foot?

CHILD: I think so, yes.

FEYERICK: This interview took place less than 24 hours after the killings of the boy's father and a friend staying with the family. The chief of police in St. Johns, Arizona, says the boy confessed to shooting the two with a.22 caliber rifle his dad had bought for hunting.

CHILD: I think I was holding the gun, and I think it might have gone off.

FEYERICK: One of the officers tells the child the first shot was likely a bad accident. Then the child seems to explain he shot his dad a second time because he was in pain.

CHILD: I didn't want him to suffer. But then I went outside then I saw -- (INAUDIBLE) and then I saw (beep) and I think the gun went off at that time.

FEYERICK: But prosecutors say the third grader shot each man at least four times stopping to reload. After telling police he was often spanked, the child appears to wipe tears from his face.

Police say there was no evidence of abuse. The child has entered no plea. His lawyer says the boy was never read his rights and that a lawyer or parent should have been with him.

OFFICER: What do you think is going to happen?

CHILD: I'm going to go to Juvy?

FEYERICK: The boy is being charged as a juvenile.

Deborah Feyerick, CNN, New York.


BROWN: It is awfully hard to listen to that sweet voice saying what that little voice says in the videotape Arizona authorities released. This was just a few years ago, and there are many important legal questions to ask about this very disturbing case which is why we're joined now by Lisa Bloom, anchor for "In Session" on truTV.

And, Lisa, I want to play a little bit more of the tape. This is a part of the interrogation where clearly they're leading this child. And then let's talk about it. Listen.


OFFICER: Do you think you might have shot at Tim accidentally that night?

CHILD: Cause I already saw him bleeding and I thought I kind of saw him shaking. And I think I was holding the gun. And I don't -- I think it might have gone off, or I don't know.

OFFICER: OK. So you saw Tim shaking and you had the gun at that time.

OK. Now, let's talk about your dad.

OFFICER 2: Let's talk about your dad.

OFFICER: How, what happened with your dad?

CHILD: I don't know.

OFFICER: Come on, tell us the truth.

CHILD: I'm not. I'm not lying.

OFFICER: You didn't shoot your dad?

CHILD: I don't know.

OFFICER: How about if we had somebody that told us that you might have shot him?

CHILD: Shot who?

OFFICER: Your dad and Tim.

(END VIDEOTAPE) BROWN: So how about if we had somebody who told us you might have shot him? Look, I am a lay person observing this, but that sounds a little outrageous to me. This is a child.

LISA BLOOM, ANCHOR, "IN SESSION": Yes. This is very, very disturbing. What we know is that children under the age of 12 especially, and this boy is a third grader, are highly susceptible to questioning by authority figures, by a police officer, by a teacher, or by a judge.

And this child, at the beginning of the interview, maintain steadfastly that he did not do it. He came home and found the father and a friend lying in a pool of blood. The authority figures make it very clear to him what they want to hear from him. And slowly over the course of the 40-minute interview, he gives them that story.

It's very hard to know if this is credible or not. What we do know is that children this young have often been found to have engaged in false confessions...

BROWN: Because they just want to please.

BLOOM: ... confessions that simply don't match up with the evidence because they want to tell authority figures what they want to hear. What we need is some hard evidence linking this kid to the crime.

BROWN: So you think there's a chance that he maybe didn't do this and the way it reads to you is it's hard to tell.

BLOOM: I need a lot more evidence, Campbell. I want to see the ballistics evidence. I want to see the forensics evidence. And, by the way, at the beginning of the videotaped interview which I listened to very closely, the female police officer says it's very important for you to be honest and I promise that I'm going to be honest.

Well, police officers don't have to tell the truth in interviews. They frequently do lie as an interrogation method. When she says somebody told me that you did it, I suspect that that is not true. There are no witnesses to this thing, so she's leading him down the primrose path. He's eight years old. It's not surprising he goes there with her.

BROWN: This whole case seems unusual. I mean, we're told the police didn't read the boy his Miranda rights.

BLOOM: Right. As if an 8-year-old would understand Miranda rights anyway.

BROWN: I know. No legal guardian present during the interrogation. I mean, should any of this have happened?

BLOOM: Absolutely.

BROWN: Are you supposed to read rights to a child?


BROWN: And should there be a guardian present? And why didn't any of that take place?

BLOOM: Yes. It absolutely should happen.

Here is what the police say. He was the victim of a crime, and they were interrogating him because he was a crime victim. They didn't expect him to become a suspect and halfway through the interview, he became a suspect.

Well, guess what? That happens every day of the week when police are interrogating crime victims. All of a sudden, oh, it looks like this person is a suspect now. They know they're supposed to stop the interview, "Mirandize" the person, say that they have a right to remain silent, the right to an attorney. And with an 8-year-old child, come on, of course an adult, a parent, the mother, the stepmother, a guardian, or an attorney should have been brought in.

BROWN: So if this goes forward, if this actually goes to trial, what happens to this kid? I mean, if he is found guilty, what can happen to this kid?

BLOOM: Well, now, we hear he's going to be tried as a juvenile, not an adult. Thank goodness for that, which means he could be held in "Juvy," as he calls it, in the juvenile facility until the age of 18. But all of this can still be used against him. So it's going to be up to the judge to take a hard look at the videotape.

I say one thing is very good about this case, Campbell, and that is that we have a videotape of this alleged confession. In a lot of states still, these confessions are not videotaped and it's the word of the police officer against the word of the suspect.

BROWN: Against the word -- yes.

BLOOM: I think certainly for juvenile interrogations, they should always be videotaped. I'm glad at least we have that so a judge can look at it very closely.

BROWN: Well, we'll stay on top of this and certainly let everyone know how it all turns out.

Lisa Bloom, thanks for being here. Appreciate it.

BLOOM: Thanks, Campbell.

BROWN: Still ahead tonight, our "Welcome to the White House" is written in the stars. We are going to check out -- yes, I'm not kidding here. It was not my idea, but the horoscope of Barack Obama's presidency. You're not going to want to miss this. Everything before nothing.


BROWN: "LARRY KING LIVE" coming up at the top of the hour. Tonight, the Obama transition of power. And who is on the president- elect's team?

Hey there, Larry, what have you got?

LARRY KING, HOST, "LARRY KING LIVE": You got it, Campbell. We'll have more on President-elect Obama's attorney general pick, and there might be some controversy.

And is Hillary still in the running? What did we hear today? And what to do when the backbone of American industry begs for help.

Plus, the extraordinary Thomas Friedman of the "New York Times" will join us with his take on things. Now, that's something you're going to want to hear. Next on "LARRY KING LIVE," Campbell.

BROWN: All right, Larry. We'll see you in a few.

Now remember how Barack Obama made that campaign promise to clean up Washington? Well, maybe he can use this. That's right. Obama's soap on a rope. Part of our "Welcome to the White House." We'll explain.

And the people of Loveland, Colorado, get our Bull's-Eye" tonight with a little coffee kindness.


BROWN: Now it's time for "Welcome to the White House," our nightly wrap-up on the next first family. And here with our "NO BIAS, NO BULL" expert in Obama-mania, Erica Hill joining us tonight.

What have you got?

ERICA HILL, CNN CORRESPONDENT: Tonight, OK. Big news on the Obama watch. So many questions about where the ladies of the future first family will be when they're in Washington.

Well, it turns out they've been in town making their way around, somehow managing to duck cameras at every stop. And these are important stops that the people want to know about.

Malia, Sasha and Michelle Obama toured Georgetown Day School yesterday. This morning their motorcade was spotted outside Sidwell Friends, of course, the Quaker school that Chelsea Clinton attended as well as one of Teddy Roosevelt's sons.

And just a little while ago, Mrs. Obama and her mother took the girls to the White House for the first time where they met with Mrs. Bush and her daughters.

Now, when they do move in, Sasha and Malia will, of course, have run of the White House children's garden and they can add their handprints to a collection in cement that includes prints from Amy Carter, Chelsea Clinton and the Bush twins. That's according to the "AP." And as you know, the frenzy for all things Obama is pretty much not going down any time soon. So here's the latest one. Since we have a little clue maybe on the school front tonight, how about the church watch? That's right. Where will the Obama family worship?

Well, it's obviously a sensitive issue after the controversy surrounding their previous pastor, the Reverend Jeremiah Wright. But the possibilities in Washington include St. Johns Church, which is an Episcopal parish known as the "church of the presidents." Also Metropolitan AME Church, which is a well-known predominantly African- American congregation, just six blocks from the White House.

And in case you're keeping count, which I know you are, 63 days to go until the inauguration. And it is still the hottest ticket in town. Get this.

Top Chef Rick Bayless has cleared his schedule, created an inaugural menu. Now, remember, we told you last week the chef is rumored to be one of the top picks for White House chef. He's a chef at one of Barack Obama's favorite Mexican restaurants.

But strictly speaking, he hasn't actually been asked to cater any event. But in the event they call him, he's got this menu ready to go. Guacamole, tortilla soup, Hawaiian yellowtail seviche, Roasted beef with red-chili guajillo sauce, apple tarts with cajeta -- I think that's how you say it -- and a little coffee.

BROWN: I would call him. I like that menu.

HILL: I think he should make the menu for us, Campbell. I mean, I'm game.

BROWN: I'm all for it.

HILL: We'll be your testers. Of course, it's also our job to leave no inaugural stone unturned. So we can now reveal Barack Obama's inauguration day horoscope.

According to Madam Lichtenstein's Cosmic World, the president- elect's sun is in Aquarius and sits in the tenth house of Cancer. I mean, career.


HILL: Clearly, I'm going to take astrology stuff. Translation: The presidency is "rooted in altruism, public services and fighting the good fight for the rights of others."

Apparently, wherever the sun sits in the chart is where we need to live out our life's dreams and ambitions. So the planetary placement is, I guess, spelling success for the Obama presidency.

And while you may not think we can top that, come on, people. It's the White House watch. We're not done. How about a little hope on a rope?

I want to adjust your TV for this picture. It really is purple because according to the creators, Obama's stands for united. Get it? The red, the blue, just purple.

This soap on a rope, though, doesn't come cheap. It is 15 bucks a pop at That's if you can find it because it's intermittently available and then sold out.

BROWN: How did you come up with that?

HILL: I got to say, I have a lot of help over at the "NO BIAS, NO BULL" team.

BROWN: Yes. You packed it all in there.

HILL: A lot of stuff going on.

BROWN: Erica Hill for us today. Thanks, Erica.

Coming up, baseball's little big man. This Red Sox infielder just won the American League's MVP award. Details when we come back.



EVELYN LOPEZ, SIXTH GRADER: Dear President-elect Obama. Hi. My name is Evelyn Lopez, and I'm a sixth grader at Johnnie Cochran Middle School. My whole family are Latinos. They came from Mexico.

This was the first year for my mom and my brother to vote. I want to become the first Latino woman president, but I know it's hard work. You are making history by being the first African-American president. You have a lot of work to do.

I can't wait until January 20th, 2009. Please come and visit. Sincerely yours, Evelyn Lopez.


BROWN: All over the country, school children writing letters to our incoming president, sharing some of those letters with us. And tonight's letter, as you just heard, came from 11-year-old Evelyn Lopez of Los Angeles, California.

And if you want to send us videos of your kids and their "Dear Mr. President" letters, look for the iReport link on our Web site,

We've got the briefing right now. Joe Johns is with us -- Joe.

JOE JOHNS, CNN SENIOR CORRESPONDENT: Campbell, John McCain's apparently not tired of running for office. CNN's Dana Bash reports McCain met with top advisers tonight to set up a political action committee. That suggests he will run for re-election to the Senate in 2010.

Somalian pirates have struck for the seventh time in 12 days. Today, they hijacked an Iranian cargo ship. And this giant Saudi tanker seized on Saturday carrying $100 million worth of oil is now anchored off the coast of Somalia. No word yet on the pirate's demand.

In California, authorities say a bonfire built by a group of young adults sparked a massive wildfire in Santa Barbara, California. The group believed the bonfire had been put out before they left. The blaze consumed nearly 2,000 acres and destroyed 210 homes.

Lake-effect snow is piling up in parts of Indiana and New York State. Areas near South Bend, Indiana, were hard hit especially. Part of Interstate 90 was shut down for hours. Two feet of snow fell near Buffalo, New York.

Chalk up one for the little guys. Dustin Pedroia of the Boston Red Sox is the American League's Most Valuable Player. The 5'8" Pedroia is the first second baseman to win the AL MVP in 50 years -- Campbell.

BROWN: All right. Joe Johns for us tonight.

And, Joe, our "Bull's-Eye" tonight in Loveland, Colorado. Sounds like a nice town. Find out why some customers at the local Starbucks are crying tears of joy.


BROWN: In tonight's "Bull's-Eye," random acts of kindness in Colorado at a Starbucks in the town of Loveland. That's right -- Loveland.

Some customers are getting a small surprise at the drive-thru. When they pull up to the window, they found out that the customer ahead of them, a stranger, has already paid for their coffee.


UNIDENTIFIED MALE: It almost kind of took my breath away for a minute. It was such a wonderful surprise. You know, out of the blue. I think something like this just shows how many good people are out there.


BROWN: Sure does. And it's apparently turning into a trend. The gesture is reportedly spreading now to other Colorado towns. So these anonymous generous folks are in our "Bull's-Eye" tonight.

That does it for us. We'll see you tomorrow.

"LARRY KING LIVE" starts right now.