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CNN LARRY KING LIVE

Illinois Governor Arrested

Aired December 9, 2008 - 21:00   ET

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


LARRY KING, HOST: Tonight, a political scandal shocks the country.
(BEGIN VIDEO CLIP, COURTESY CLTV/CHICAGO)

PATRICK FITZGERALD, U.S. ATTORNEY: Governor Blagojevich has been arrested in the middle of what we can only describe as a political corruption crime spree.

(END VIDEO CLIP)

KING: The Illinois governor allegedly selling influence and Barack Obama's Senate seat.

(BEGIN VIDEO CLIP, COURTESY CLTV/CHICAGO)

FITZGERALD: The governor's own words describing the Senate seat: "It's a bleeping valuable thing -- thing. We don't just give it away for nothing."

(END VIDEO CLIP)

KING: Rod Blagojevich.

Plus, eye-popping, jaw-dropping charges and the Feds say FBI wiretaps caught it all on tape.

(BEGIN VIDEO CLIP)

BARACK OBAMA (D), PRESIDENT-ELECT: It's a sad day for Illinois.

(END VIDEO CLIP)

KING: But Blagojevich is still the governor.

What happens now?

Plus, President-Elect Obama and Al Gore meet today on climate change.

(BEGIN VIDEO CLIP)

OBAMA: The time for delay is over. The time for denial is over.

(END VIDEO CLIP)

KING: The two talk green and get going on a game plan to re-power America.

It's all right now on LARRY KING LIVE.

If you don't know this story, you're living on Mars.

Drew Griffin was in the Chicago courtroom today where the governor was brought.

What happened -- Drew?

DREW GRIFFIN, CNN SPECIAL INVESTIGATIONS UNIT CORRESPONDENT: Surreal. The governor comes in and he's a fairly arrogant guy. He's got a lot of bravado, Larry.

He walks into the courtroom and begins working the room like a politician, not like a defendant. He's got a blue jump suit on, some jogging -- tennis shoes on. He starts waving and nodding to people and then sits through the -- the 15-minute hearing, tells the judge he understands his rights. And then he's released on his own recognizance.

Later today, his attorney came out of Blagojevich's home saying look it, the governor said that -- he says he's sad, surprised and, Larry, he says he's innocent.

KING: Well, now, that was a hearing, not an arraignment, right?

So he didn't have to plead?

GRIFFIN: That's correct. He was -- he was read the two charges that he and his chief of staff, John Harris, were facing. He was told of the consequences of those charges if convicted -- basically 20 years and 10 years in a prison, respectively. And then he was told conditions for his bail, which are fairly light -- a signature bond and he got his passport taken away and told not to leave the Continental United States.

And then -- and then he was released.

KING: You've covered a lot of political scandal.

Ever anything close to this?

GRIFFIN: Nothing this brazen. This was unhidden. And the scope of it -- literally, according to the allegations by the U.S. attorney, from the moment he was elected in 2002, Blagojevich seems to be using his office to sell favors -- to curry favors, to use his power to enrich himself. And I think that the rush this morning -- the 6:15 a.m. arrest of the governor -- almost a Mafia-style arrest at this door -- came because there was a sense of urgency. The U.S. Senate seat for Illinois -- Barack Obama's seat -- was being sold, almost on the open market.

KING: Wow!

Drew will be back with us later. Drew Griffin, CNN Special Investigations Unit.

Joining us now in Chicago, is Lisa Madigan. She's the attorney general of the State of Illinois. She was mentioned as a possible successor to Barack Obama.

Did you want that job?

LISA MADIGAN, ILLINOIS ATTORNEY GENERAL, POSSIBLE SUCCESSOR TO SENATOR OBAMA: No, I never expressed any interest in the job. And, in fact, I haven't spoken to the governor or any of his associates about it. I made a commitment to serve as the attorney general and that was one that I intend to fulfill.

KING: Lisa, as you well know, as well as anyone would know, we are a country that has a belief in innocence until proven guilty.

Is that at all possible in this case?

MADIGAN: I think it...

KING: Is anyone ever presuming him innocent?

MADIGAN: Well, I think It's going to be very tough. I mean, as was displayed today by the U.S. attorneys, they have some very solid evidence. They had -- his phone line was tapped. There was a bug in, apparently, his offices. And so they have months of recordings.

And it seems pretty clear from the allegations that he was willing to sell the Senate seat. He was with holding payments for campaign contributions before he would sign legislation or provide Medicaid reimbursement to a children's hospital. He went so far as to get an editor at "The Chicago Tribune" fired before they would do a financing for Wrigley Field, home of the Chicago Cubs.

So, you know, as Drew said, brazen conduct -- shocking conduct, particularly because this is a governor who has been under federal investigation for years. And everyone has been speculating that it's just a matter of time until an indictment came down. And yet he was continuing to carry on in this manner.

KING: What's the law regarding his governorship?

Does he remain in office?

MADIGAN: He is still the governor. Obviously, I've called on him to resign, as have many others in the state. At this point, he claims he will not resign because he claims he has done nothing wrong. And so the legislature has an opportunity, at this point, to move ahead on an impeachment.

Should they fail to do that, I also have an opportunity to go to the Illinois Supreme Court to seek to have him removed because he cannot serve in office.

KING: Could he technically, tomorrow, announce a senator? MADIGAN: Technically he could. I think it's highly unlikely that anybody in their right mind would accept a U.S. Senate appointment from the governor. I think it's obviously tainted. And so the legislature does plan on going into session early next week and passing a law that would call for a special election as the way to put in a new U.S. senator in Illinois.

KING: Barack Obama is not accused of anything in this case, but it's the fallout for him -- the fallout is a question mark.

Watch his comment.

(BEGIN VIDEO CLIP)

OBAMA: I had no contact with the governor what -- or his office. And so we were not -- I was not aware of what was happening. As I said, it's a sad day for Illinois. Beyond that, I don't think it's appropriate to comment.

(END VIDEO CLIP)

KING: When did you last contact or have contact with the governor?

MADIGAN: You know what, the only time this entire year I've even spoken to the governor was actually out in Denver at the Democratic National Convention. And I was complaining about the fact that he, for political reasons, had cut my budget 25 percent this year.

KING: Lisa, obviously, somebody must like him. He was elected governor.

Has anyone come out in his corner?

MADIGAN: I haven't seen anybody. And, you know, one of the reasons that he won a second time is that he had amassed a tremendous amount of money and started running ads almost immediately after the primaries had taken place against the Republican candidate. He really did bury her in negative ads. And he did win re-election, unfortunately.

KING: Now, in order for there to be the quid pro quo of a proposition, don't we have to have someone who received the bid to make the bribe?

MADIGAN: Well, you...

KING: Don't we have to have a person who he said, you want to be Senator, give me this?

MADIGAN: Well, it's unclear at this point. And as the U.S. attorney, Patrick Fitzgerald, has indicated, they put those charges out today. They plan on continuing their investigation. They had asked people with information to come forward so that they can complete their investigation. But they were very concerned, based on what they had heard, that they had to bring these allegations out immediately, to make sure that there wasn't going to be any campaign contributions being made for the U.S. Senate seat, for signing legislation or for any other illegal and improper reasons.

KING: Thank you, General Madigan.

General Lisa Madigan, the attorney general of the State of Illinois.

Suze Orman was our scheduled guest tonight. Due to the news about the governor, she has graciously agreed to join us tomorrow night instead.

We'll be back with two more people who were mentioned as possible successors -- both members of Congress.

What do they think about all of this?

Stay with us.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP, COURTESY CLTV/CHICAGO)

FITZGERALD: Governor Blagojevich has taken us to a truly new low. The conduct would make Lincoln roll over in his grave.

(END VIDEO CLIP)

KING: That, of course, the well-known Patrick Fitzgerald.

Joining us now, two distinguished members of Congress, both from Illinois. The Democrat, Congressman Danny Davis. He was touted as a possible successor to Barack Obama. And Representative Jan Schakowsky, also considered a possible successor.

Were you interested, Jan?

REP. JANICE SCHAKOWSKY (D), ILLINOIS, POSSIBLE SUCCESSOR TO SENATOR OBAMA: Yes, I expressed interest in the job. No question.

KING: And you Congressman, Davis?

REP. DANNY DAVIS (D), ILLINOIS, POSSIBLE SUCCESSOR TO SENATOR OBAMA: Well, yes, I was very much interested.

KING: How shocked are you about all of this, Jan?

SCHAKOWSKY: I really was shocked. You know, this morning, when I heard that the governor had been taken into custody, I was really shocked. But when I heard that it really involved the selling of the Senate seat, I was doubly disturbed by what I had heard. I had no idea that this was a seat that was out on the auction block.

KING: Congressman Davis?

DAVIS: Well, I was devastated. As a matter of fact, I thought immediately that, you know, this is a terrible day for the citizens of Illinois. But more importantly, it's a terrible day for the institution of government. And it undergirds and erodes confidence that people have in government. And it's so unfortunate.

KING: Congresswoman Schakowsky, could the House and Senate get into impeachment proceedings right away in Illinois?

SCHAKOWSKY: Well, I know that there has been legislation ready to go to do just that. But perhaps even more importantly, in terms of the Senate seat, they're going to go back into session and make a decision about taking the power to appoint the Senate -- the senator away from the governor and call for special elections instead and leave it up to the voters of Illinois, which I think, at this point, is really required to take the -- the stigma off of the appointment.

KING: Yes.

Here's more of what U.S. Attorney Patrick Fitzgerald said about the governor and Obama's Senate seat today.

Watch.

(BEGIN VIDEO CLIP, COURTESY CLTV/CHICAGO)

FITZGERALD: The tapes reveal that Governor Blagojevich wanted a number of things in exchange for making the appointment to the Senate seat -- an appointment as secretary of Health and Human Services or an ambassadorship, an appointment to a private foundation, a higher paying job for his wife or campaign contributions. At one point, he proposed a three way deal, that a cushy union job would be given to him at a higher rate of pay, where he could make money.

(END VIDEO CLIP)

KING: Congressman Davis, last month, the governor said you'd make a great U.S. Senator.

Did he talk to you about it?

DAVIS: Well, he did talk to me about being a United States senator, but he never talked to me about any of these other quid pro quo kinds of things. Never in any interactions that I've had with the governor, or anybody representing him, has there been any hint of impropriety or quid pro quo.

KING: And what about you, Congresswoman?

SCHAKOWSKY: You know, I talked to the governor on November 17th. And we were talking about whether or not I was really in contention. And he said that I was. But I get the feeling that I was never really being seriously considered because he never asked me for anything. And it seems as if only those who were asked something are serious.

KING: Should he resign, Congressman Davis?

DAVIS: Well, you know, I take the position that one is innocent until proven guilty. There are some charges and allegations, but there has been no indictment. And so I'm willing to give the governor a little more time. And I'm willing to let the process kind of ride itself out.

We do have a judicial system, a court of law. And, of course, he has not been charged officially in terms of an indictment. So I'd give him a benefit of the doubt.

KING: Congresswoman?

SCHAKOWSKY: See, he...

KING: I'm sorry.

Go ahead.

SCHAKOWSKY: Yes. My feeling is that this is not just a legal question. This is also a political question.

And is the governor really in a position now to offer the kind of leadership that the people of Illinois really, really deserve?

Is he capable of leading our state in the proper direction?

And I think that, at this point, the answer really is no.

Clearly, on the legal charges, there will be a process and perhaps he, you know, may be found guilty or not. But I think it's very difficult for him to be the leader that we need as governor right now.

KING: Right. It would seem.

Congressman Danny Davis, Congresswoman Jan Schakowsky.

I'm sure we'll be calling you on again as this process continues.

Thank you both.

SCHAKOWSKY: Thank you, Larry.

DAVIS: Thank you.

KING: We'll be back in 60 seconds.

Thank you.

Back in 60 seconds with some incredibly compelling sound laying out the corruption case against the Illinois governor.

(COMMERCIAL BREAK)

KING: It wasn't all about Obama's Senate seat. U.S. Attorney Patrick Fitzgerald laid out other startling allegations against Governor Blagojevich, including his alleged involvement with funding for a children's hospital and a tollway. Watch.

(BEGIN VIDEO CLIP, COURTESY CLTV/CHICAGO)

FITZGERALD: I'll give you two examples set forth in this 76-page complaint.

One involves Children's Memorial Hospital -- a hospital that obviously takes care of children. At one point, the governor awarded funding -- reimbursement funding to that hospital -- to the tune of $8 million. But he also indicated privately that what he wanted to get was a $50,000 personal contribution from the chief executive officer of that hospital.

In the ensuing weeks, that contribution never came. And Governor Blagojevich was intercepted on the telephone checking to see whether or not he could pull back the funding for Children's Memorial Hospital.

A month or so ago, a $.18 billion tollway project was announced. And while that tollway project was being announced, Governor Blagojevich was privately seeking to have a person benefiting from that contract raise $100,000 in contributions. And privately, the governor said: "I could have made a larger announcement, but wanted to see how they would perform by the end of the year.

If they don't perform, bleep 'em."

That's a quote. And the word bleep was not the word he used.

(END VIDEO CLIP)

KING: Do you think the Illinois governor's scandal will taint President-Elect Obama?

That's the question on our blog. You can go to CNN.com/larryking right now and weigh in and we'll air some of your comments later in the show.

Stay with us.

(COMMERCIAL BREAK)

KING: Joining us now in Chicago, Gerould Kern, editor of "The Chicago Tribune," and Bruce Dold, editorial page editor of that very famous newspaper.

The "Chicago Tribune" isn't just covering the Blagojevich part of it from regards to the other things. They're also covering it from the newspaper's standpoint.

Watch.

(BEGIN VIDEO CLIP, COURTESY CLTV/CHICAGO)

FITZGERALD: "The Chicago Tribune" had not been kind to Governor Blagojevich, had written editorials that called for his impeachment. And Blagojevich and defendant Jonathan -- John Harris, his chief of staff, schemed to send a message to the "Chicago Tribune" that if the Tribune Company wanted to sell its ball field, Wrigley Field, in order to complete a business venture, the price of doing so was to fire certain editors, including one editor by name.

In the governor words -- governor's words: "Fire all those bleeping people. Get them the bleep out of there and get us some editorial support."

(END VIDEO CLIP)

KING: Gerould Kern, were you on the firing list?

GEROULD KERN, EDITOR, "CHICAGO TRIBUNE": I -- I'm -- I don't believe so. But I've got to tell you, that was a surprise to all of us today to hear that. We had no idea.

KING: Bruce, do you think you were going to be ousted if the deal -- if his deal went through?

BRUCE DOLD, EDITORIAL PAGE EDITOR, "CHICAGO TRIBUNE": Well, he -- he did say he wanted to sweep out the editorial page and I run the editorial page. So I've got to assume that I as. I've covered politics in this town for -- Chicago, for 30 years and I've never seen anything like this. He -- he singled out my deputy editor, John McCormick, who has written most of the editorials about the governor. So at least the governor knew who was writing what at the paper.

KING: How does it feel, Gerould, having your paper named like this?

KERN: Well, it's a -- it's a surprise, you know, to us all. You know, we -- we're doing our job reporting on public issues -- and, I think, doing a fine job, both on the news pages and on the editorial pages. And it's shocking to hear that kind of sentiment coming from the governor of the state.

I will add, though, that there was never any complaint, request, any pressure put on me at any time about any of our editorials, about any of our personnel on the editorial board -- nothing from inside the company about that at all -- in fact, nothing from outside, either.

KING: So, Bruce, you had no awareness of any of this?

DOLD: No. You know, we knew the governor wasn't happy with us. We had pushed pretty hard to get a recall mechanism in the state. You can't recall public officials now. And we thought the public ought to have a chance to decide whether to kick him out.

We couldn't get that through the legislature. And when we couldn't get that through the legislature, we did start to push for a committee in the Illinois House to investigate impeachment. And, apparently, that was getting the governor's blood boiling.

We once had a pretty good relationship with him. The first year he was in office, he came in pretty often. We talked about the Cubs, we talked about politics, whatever.

As we saw more of the pay to play, more of these kind of instances, we had grown more critical of him. And he had grown much more distant from us.

KING: Gerould, the "Trib" was doing its own investigation, we understand, of the governor. Prosecutors asked you to delay publication of some of the stories.

What can you tell us?

KERN: Well, we were conducting our own investigation -- a journalistic investigation. The U.S. attorney was conducting a criminal investigation. And at times, you know, we -- we have developed information. And as we are -- as we do in standard practice, we ask questions, we get confirmation, we get information from principle characters involved in the story. And we did that, you know, with the U.S. attorney.

And there were a limited number of occasions where they indicated that publication of information at that particular moment could jeopardize the investigation. And they asked us to consider, you know, delaying that. We took that under advisement. We considered it. And there were circumstances where we continued to do our reporting and publish the story, you know, a few days later. There were also instances, I would say that, where requests were made like that and we said no and we went ahead and published the story, you know, in the next edition.

KING: Bruce, what will the editorial page of the "Tribune" say about how the senator -- the next senator -- should be chosen?

DOLD: Well, tomorrow we're going to say that Governor Blagojevich needs to resign and that if he doesn't resign, he should be impeached. We have not said that before today. But I think everything we've seen from this governor, even before this criminal complaint was filed, you know, was leading up to that.

So I think if the governor resigns or if he is quickly impeached, the lieutenant governor would step in, Pat Quinn. He has a reputation for honesty. I know that's surprising in Illinois...

(LAUGHTER)

DOLD: ...but he has a reputation as an honest guy. And I think he could he could make the selection for the senate.

I also think if -- if the governor doesn't, you know, somehow clings, stays on, then we would have to go to a special election, because no one could accept this governor's appointment to the U.S. Senate and survive. It would be absolutely unacceptable to anybody in the state.

KING: And, Gerould, would you say if Quinn does the selecting, no one would question it? KERN: I can't say -- I can't say that unequivocally. I've got to believe that he's got far more credibility coming into office than Blagojevich does now, given the cloud that's over him.

I agree Bruce's analysis of this. I think it's just politically impossible to accept Blagojevich's nomination, should he offer one up at this time.

KING: Thank you, gentlemen.

Gerould Kern and Bruce Dold of the "Chicago Tribune".

You're watching LARRY KING LIVE and we'll be right back with lots more.

Don't go away.

(COMMERCIAL BREAK)

KING: Joining us now in Washington, Lynn Sweet of the "Chicago Sun-Times." She is their Washington bureau chief and columnist.

In Washington, as well, is Chris Cillizza. He is the -- he writes "The Fix" column in thewashingtonpost.com and was recently appointed White House correspondent for "The Washington Post."

What an appropriately named column for this story.

(LAUGHTER)

KING: And back with us in Chicago is Drew Griffin, CNN Special Investigations Unit.

Lynn, what do you -- what do you make of all of this?

LYNN SWEET, D.C. BUREAU CHIEF, "CHICAGO SUN-TIMES": Well, I make of it that

Governor Blagojevich, who had a chance to rehabilitate his reputation a little bit by making a good Senate pick, just, in the words of Patrick Fitzgerald, did something that would make Lincoln turn in his grave.

This takes the cake. I've seen a lot of corruption in my years of covering Chicago politics. And this one just is over the top.

Usually these guys, Larry, know how to go up to the line and do play for play and just -- just stay this side of the line. And it just seems that Governor Blagojevich had a lot of schemes going on. And even though he knew he was under scrutiny, just couldn't -- couldn't resist the temptation of trying to finagle something out of this one.

KING: Chris, I don't want to get into psychological judgments.

Do you think something is the matter with the governor? CHRIS CILLIZZA, W.H. CORRESPONDENT, WASHINGTON POST: You know, Larry, the thing -- I read this 78-page criminal document today, several times. And the thing that struck me over and over again was the sort of Nixonian elements to it, which is that, as Lynn said, this is not someone who -- was unaware that authorities were looking into him.

Since 2003 he has known. Maybe not the specifics of the investigation but certainly that he was a subject of an investigation. There's a level of self-delusion in his statements, in the wire taps that -- that's really amazing. The idea that he could somehow appoint himself to the Senate and be rehabilitated enough to run for president in 2016.

The idea that he could be secretary of Health and Human Services. The idea that he could trade with Senator Obama, soon to be President Obama, for a position as the head of a labor union.

This is someone with a 14 or 13 percent job approval. He's not really in a position...

KING: No.

CILLIZZA: ... to sort of -- he's not in a powerful position to negotiate.

KING: Drew Griffin, just yesterday, the governor just yesterday had this to say about the idea of somebody wire-tapping him. Watch him and comment.

(BEGIN VIDEO CLIP)

BLAGOJEVICH: I got to tell you that whatever I say is always lawful and the things I'm interested in doing are always lawful. And if there are any things like that out there, with (INAUDIBLE) here, is a governor who tirelessly and endlessly figures out ways to help average, ordinary working people.

You might hear a couple of words that you might not hear publicly but those are only adjectives to describe maybe some of you. But -- and you'll hear probably a lot of discussions about the Cubs and some of my ideas on what they ought to do in the off season.

But, you know, this is America. You know? And I appreciate it if you want to tape my conversations, give me a head's up and let me know.

(END VIDEO CLIP)

KING: Drew, he has a bit of a charm about him, does he not?

DREW GRIFFIN, CNN SPECIAL INVESTIGATION UNIT: Yes, some would call it a charm. Some would call it a swagger. I, I think...

KING: Yes. GRIFFIN: ... when you ask is there something wrong with the governor, people in Illinois, I think, are asking that tonight. He has a -- has had a sort of bunker mentality. It's me against everybody else, and everybody else happens to be his own Democratic Party.

Here in Illinois, he had to have known -- if he just read one or two of Lynn Sweet's great articles, he had to have known that the feds were circling his office and then he finds out last week from the media that his phones are tapped and he, and he make a comment like that.

I really don't know what the motive here other than this governor either was delusional or there was some desperate need for money or -- financial security that we're not seeing yet.

SWEET: Well, I would...

KING: Lynn, what's -- go ahead, Lynn.

SWEET: I've known Blagojevich for many years. I've covered him from the days when he was a state representative. And on this one, I think he has a very optimistic sunny personality where he thinks he's the kind of guy. Maybe guys, you know, who were out there watching this always knows somebody who thinks things will turn out OK.

You know, I once wrote a story about him, Larry, where with -- most politicians I cover would have thought it devastating. Let me put it this way. You spelled my name right and you put it on the front page. So he does look at things different than other people I covered.

And he's a bit of a wise guy in him and the idea that he could be at Republic's -- at the Republic Window & Door yesterday -- you know, there's two parts to this guy. He was trying to do his thing with the workers there. But somehow in there he just got caught up, caught up so much in this pay for play, for this need for campaign cash, which in Illinois is a wide open state.

They've never put a lid on these things and now this is what the citizens have to contend with because people have not stood up in this state to say, enough is enough.

KING: We'll be right back with Lynn Sweet, Chris Cillizza and Drew Griffin on this edition of LARRY KING LIVE. Don't go away.

(COMMERCIAL BREAK)

KING: Before we get back with our panel, what are you saying today on THE LARRY KING LIVE blog?

David Theall is here to tell us all. David?

DAVID THEALL, LARRY KING LIVE PRODUCER: Larry, this is the question we asked on your blog today. Do you think the Illinois governor scandal will taint President-elect Obama? Get right to the comments. Al chimed in, he says no, that it will not taint President-elect Obama. He says, the governor, most despicable, but Obama looks clean, he says.

Dianne also says that no, this will not taint President-elect Obama. She says, "However, the Republicans will do what they can to try to make President-elect Obama a part of this corruption."

Of course, we heard from people who feel differently, people who feel on the other side. One of them was Eric. He said, "Are we to believe that Obama can come up through the notoriously corrupt Chicago political machine completely clean? Please," he adds.

And finally, Larry, we also heard from Jason on your blog who, when asked, will this taint President-elect Obama, says "Tainted by this? With Bill Ayers, Tony Rezko, Reverend Wright, what more is there to taint?"

We, of course, are going to continue this conversation throughout the evening on your blog, CNN.com/Larryking. Look for the live blog link so you could come on in, jump into the conversation.

KING: Thanks, David, as always.

Chris Cillizza, what do you think is going to happen in Chicago?

CILLIZZA: Well, you know, Larry, my best guess based -- it's an informed guess based on reporting. A lot of moving parts here. You know, I want to warn you that it's not set in stone. So my guess is we are looking at a special election, a primary and a general election, sometime early next year.

Lynn and I were talking before we came on, this -- if you are a Jan Schakowsky or a Danny Davis, two people you just had on, this is the absolute dream scenario for you.

You have, you have two months, essentially, to run for the Senate. These campaigns take two years. We've just spent two years litigating these campaigns. Now the idea that in a two-month period you could wind up in the Senate, it's not the best of circumstances, I'm sure neither of them...

SWEET: Right. It makes it...

CILLIZZA: ... wish those circumstances, but it is, it is certainly a good scenario for them.

SWEET: It make it is a cheap campaign. The other thing you're going to see while the general assembly is going to move to strip Blagojevich his power to appoint, let's just say some people might think, well, he still has a few days where he could make an appointment.

Senator Harry Reid, the Senate leader, sent out a statement tonight that indicated to me that even if Obama were to make an appointment, the senators would not seat the new colleague on the floor.

KING: Drew, if there is an election, would young Mr. Jackson be the favorite?

GRIFFIN: You know I talked to his spokesperson tonight who said that he was very interested in this idea about a special election. I haven't seen any polls, but certainly he would be in the running.

And what would be interesting is you wouldn't have to curry favor with any politicians who stand in line. You can just throw your hat in the ring and if you've got enough money left over from, let's say, a congressional campaign, you can use that money to run now for the U.S. Senate.

SWEET: Yes, Larry, let me just put the (INAUDIBLE), is this special, the candidates will be because there's nothing to lose. You don't have to step down. It will be a pretty even playing field. Jan Schakowsky and Danny Davis are well known with the state. Davis just went on a statewide tour. Congressman Jackson has been campaigning for the seat.

So you will have a lot of people in it because it will be a fairly cheap race. I would think -- I've covered politics in Illinois for many years, my whole career here. I would say you start out, don't assume any one is a front-runner if there is a special election.

KING: Chris, is a Republican going to get it, going to run?

CILLIZZA: Yes, Larry. If there's, if there's a special election, absolutely. Now -- but we know going back to 2004 when the Republican Party ended up with Allen Keys as its nominee...

KING: Yes, I know.

CILLIZZA: ... against then Senator Barack Obama. It is not in the greatest of places right now, the Illinois Republican Party. The name I keep hearing is a guy named Mark Kirk. He represents the tenth district, he's a congressman, just re-elected in a pretty tough race.

Two key things about Mark -- or three things. One, he's a moderate. That's very important as a Democrat -- as a Republican in Illinois. Number two, he's known in Chicago media market, absolutely essential. In a short election, Chicago media market, very expensive.

Number three, he can raise and has shown the ability to raise vast sums, millions of dollars in a short amount of time. So I think he, he would be the preferred candidate. Not clear whether he could get through a primary, though, Larry, because he is a moderate.

SWEET: Right. But also, if it came to a Senate race, and, again, this is local so I'll try to be quick. A lot of the money and support he had are -- many of them are Democrats who in a House district support Republican. In a statewide race with other choices probably would not be there.

KING: And Drew, will he be impeached? GRIFFIN: Well, we'll see. I think, you know, it depends a lot on whether or not he's going to resign first. I think everybody here is trying to give him the benefit of the doubt to take the next few days and decide what his figure is. But I think eventually if he doesn't step down, it sounds like impeachment will be -- will be moving at least on the table.

KING: Thank you all very much. We'll be calling on you a lot, Lynn Sweet, Chris Cillizza and our own Drew Griffin.

Breaking news tonight, when we return, we'll tell you about the conceptual agreement just confirmed in the auto bailout deal. Michigan governor, Jennifer Granholm, is here to comment.

And is there a climate change crisis? President-elect Obama and Al Gore have a meeting of the minds. Back in 60 seconds.

(COMMERCIAL BREAK)

KING: Breaking news tonight. The White House and congressional Democratic negotiators have reached a conceptual agreement on a proposed $15 billion automakers bailout package according to senior administration officials and a Senate Democratic aid. But the aid cautioned that there remain some sticking points to work out.

The governor of Michigan is with us.

Governor Jennifer Granholm, what can you tell us?

GOV. JENNIFER GRANHOLM (D), MICHIGAN: Well, I know that they've been working all day and into this evening and I know there were very few points of difference before going into a meeting with the White House and my understanding is that there is a conceptual agreement. They've got to put it to paper.

But the bottom line is, if they have reached an agreement and they get the votes in the Senate, in particular, that's where it starts to get this through, it's great news for 3 million American auto workers and people who are touched by the auto industry and, frankly, it's great news for the future of the nation because we can...

KING: Yes.

GRANHOLM: ... re-brand and reshape an auto industry that's green and is electric. And I know that it's part of what we want to talk about this evening, too.

KING: You're right. Is $15 billion enough?

GRANHOLM: Well, it won't be enough to do the whole trick but it gets us into the Obama administration and I think that's very good news, too, because I think this is a long-term strategy to make sure that we do have the ability to be independent of foreign oil.

That's part of the strategy of the Obama administration, is to make sure we've got vehicles that are powered by batteries, that are built in the United States by American workers, and vehicles -- put into vehicles that are built here in the United States and it creates jobs.

So all of that is very good for our national security, our energy security, and certainly jobs.

KING: Is Ford in this deal or not?

GRANHOLM: Well, Ford said that they would like to have access to the line of credit but that they would not draw down on it. So this first two draws will likely be for General Motors and Chrysler.

KING: We're going to take a break. And when we come back, Robert Kennedy Jr., John Stossel and Eric Schmidt of Google will join the governor in a discussion of the environment and other things. Don't go away.

(COMMERCIAL BREAK)

KING: Before we go with our panel, let's check in with Anderson Cooper, the host of "AC 360." Anderson? I think I know what's up.

ANDERSON COOPER, CNN ANCHOR: Yes. I think you do. We're following the story that you have been following. Breaking news on the Illinois governor. The governor is home tonight on bail after being hauled into federal court corruption -- federal corruption charges he's facing.

One of the allegations is he tried to sell Barack Obama's now vacant Senate seat to the highest bidder. We'll have the late breaking details.

And O.J. Simpson settling into his new role as prison inmate. A photo of him out by the prison. His co-defendants are appearing in court. His former friends tell the court they are sorry, too, but unlike O.J. they have escaped jail time. How did they do that? We'll explain in "Crime and Punishment" tonight.

And Oprah Winfrey's personal struggle. For the first time she is speaking out about new weight gains, saying she's put on 40 pounds in the past two years. It is a revealing look inside Oprah's life.

All that and more, Larry, tonight on "360."

KING: That's Anderson Cooper, 10:00 Eastern, 7:00 Pacific.

Now we'll assemble the panel. Barack Obama and Joe Biden met with former president Al Gore today -- former vice president Al Gore today to talk the environment, energy, and the economy. We'll get to that in a moment. But first, the condition in Illinois and we'll start with the governor.

What do you make of your fellow governor's problems?

GRANHOLM: It's just appalling. I don't -- it's incredible to me that somebody would abuse the public trust in that way from the tapes that have been played. It's just -- you know, it's disgusting.

KING: Robert Kennedy, what's your reaction?

ROBERT KENNEDY JR., ENVIRONMENTALIST, ATTORNEY: To what is happening in Illinois, I think it's appalling.

KING: Yes.

KENNEDY: You know, on the subject that we're here to talk about, which is energy, I want to commend particularly Governor Granholm for her leadership on this issue in making sure that the bailout happens. This is one out of every ten American jobs, but also that conditions were put -- fair conditions were put on -- and rational conditions were put on the automobile industry to try to make this transition to batteries and electric cars and she's been terrific on that issue.

KING: All right. Let's go to that issue. That's, that's the reason you're here. We've discussed that (INAUDIBLE) the governor of Illinois and probably will be for another year.

John Stossel, what -- how do you react to the news tonight of the apparent $15 billion deal?

JOHN STOSSEL, CO-ANCHOR, 20/20: I think it's a sad day for America when we reward failure. The governor said it's good news for three million Americans and temporarily it probably is but it's bad news for 297 million Americans. The politicians are pouring more money down the drain.

KING: Eric Schmidt, the CEO of Google, how do you read it?

ERIC SCHMIDT, CEO, GOOGLE, ON TRANSITION ECONOMIC ADVISORY TEAM: Well, from my perspective putting incentives around addressing climate change, fuel efficiency, and so forth, is something that the government's got to do. If those conditions are really part of the $15 billion and if the auto industry sticks to it, it is good for America.

KING: All right. The president-elect had this to say after meeting with Al Gore about global warming. Watch.

(BEGIN VIDEO CLIP)

BARACK OBAMA (D), PRESIDENT ELECT: The time for delay is over. The time for denial is over. We all believe what the scientists have been telling us for years now, that this is a matter of urgency and national security. And it has to be dealt with in a serious way. That's what I intend my administration to do.

(END VIDEO CLIP)

KING: Robert Kennedy, do you have high expectations for this administration?

KENNEDY: I do and, you know, all of the things that we need to do, Larry, to deal with global -- to avert the catastrophic impacts of global warming are things that we ought to be doing anyway to free ourselves from foreign oil, to reduce our huge trade deficits, to free ourselves from entanglements with these Mideastern sheiks who despise democracy and are hated by their own people.

If we can get off of oil The principal impediments to getting off of carbon are the huge, huge subsidies we give to the oil industry every year. $1.3 trillion to oil, about $1 trillion in subsidies to coal, about a half a trillion to...

KING: But you...

KENNEDY: And the president, one of the great things that this president has committed to do is to construct a national grid that will -- that will provide a real marketplace where much more efficient forms of energy can get in and -- lowest cost providers, solar, wind, and other forms...

KING: Eric...

KENNEDY: ... will come into the market place.

KING: Eric, you were a member of Obama's transition economic advisory board. Was this discussed on that board?

SCHMIDT: It has been. And I'll tell you that these guys are serious and they're moving pretty quickly. It's obvious that with the stimulus package coming we have an opportunity to remake the infrastructure of America into the model that we want to live with for the next hundred years. Solar wind, enhanced geothermal, more hybrids, that sort of stuff.

We've got to do the grid as Robert talked about, but the message about America is not about politics and all of that. It's about innovation. So the enormous creativity that exists in American universities, entrepreneurship, and that is unleashed by all of these new policies if done right.

KING: We'll get the comments of John Stossel and Governor Granholm right after this.

(COMMERCIAL BREAK)

KING: John Stossel, you can't be opposed to clean air, can you?

STOSSEL: I'm for clean air but global warming is not an issue of carbon -- of clean air. Carbon monoxide is not a pollutant that makes the air dirty. I mean this is magical thinking and faith in the magical healing power of politicians to think that with a few laws they can solve this problem.

If it's a crisis, and many scientists say it isn't, there's just no way with solar power and wind power that we are going to make a dent in our energy needs. We're going to be dependent on foreign oil for a very long time.

KENNEDY: Now that's not... KING: Governor Granholm, how will you respond?

GRANHOLM: I have to chuckle because, boy, Mr. Stossel is really looking in the rear view mirror. All of the credible scientists around the globe have said the same thing, that we are seeing a warming of the earth. And for us...

STOSSEL: Yes.

GRANHOLM: ... in this nation, in this economic crisis, what is so important for us is that we are going to be able to create a whole new industry surrounding, reducing climate -- global warming. We can have people installing the energy efficiency devices in people's home to create energy efficiency...

STOSSEL: Politicians can't create industries. Eric is right. The creativity comes from free individuals, not you politicians. Forgive me.

GRANHOLM: The -- well, excuse me. This would be industry that creates the opportunity for jobs and certainly solar...

STOSSEL: And you're going to pick which industries?

GRANHOLM: ... panels on people's roofs and windmills in regions of the country that have produced a lot of wind. The infrastructure associated with the smart grid, the ability to put batteries for energy storage in your home or in your vehicles, the ability to capture the movement of (INAUDIBLE) energy.

STOSSEL: If it's a practical idea, it would happen.

GRANHOLM: It creates -- in fact people who have studied this have said 40 million jobs will be created over the next 30 years. It's a very exciting time, it's a very exciting time to look forward and move forward...

KING: Robert...

GRANHOLM: ... and to really be a contributor to the solution.

KING: Robert, you've also dealt a long time with those who oppose you, right? I mean it's not surprising for you to hear what John Stossel is saying, is it?

KENNEDY: Well, Governor Granholm is right. You know government needs a role in this. The role is to construct a national grid that can act as a marketplace that does what a marketplace is supposed to do which is to reward good behavior which is efficiency and to punish bad behavior which is inefficiency in waste.

You know we built the (INAUDIBLE) in that grid, the Internet highway in 1979. The government did that. And what happened? A year later there were only 500 PCs in this country and IBM was saying it was a dead end technology. That's the kind of thinking that John Stossel is talking about today. Well, today everybody has a PC and the price of information of bits and bytes has plummeted precipitously. That's the same thing that will happen if we build a national...

KING: Eric...

KENNEDY: ... electric grid in this country that can efficiently transport energy through big wind centers and solar centers that provide so much renewable energy.

KING: Eric, do you concur?

SCHMIDT: I do. We need a network that people can connect to. There are very large groups that are just ready to get into the businesses that John was talking about so negatively.

They're just ready to spend literally billions of dollars to get this new energy sources online. The benefit of that, more jobs, more taxes, more experts in businesses, greater global security.

STOSSEL: But Eric, if -- they're ready to do it why do they need government? Why don't they just do it?

SCHMIDT: Because there are many impediments in the current regulatory environment that do not allow or make it very difficult for them.

STOSSEL: That's different from subsidy.

SCHMIDT: Well, the subsidy makes sense because first, existing fossil fuel industries are heavily subsidized. And secondly...

STOSSEL: Well, let's get rid of all subsidies.

SCHMIDT: Well, in fact, if you -- if you follow that model, that's fine but it's not going to happen.

KING: All right. Thank you all very much.

By the way, Robert, what do you make of your cousin Caroline maybe running for the Senate or being appointed?

KENNEDY: I hope she does. I've been encouraging her to do it. She's been a leader on education in this country. She's raised $60 million over the last couple of years for the New York City public school system.

KING: All right. We're out of time.

KENNEDY: She's one of the great national voices in education. I hope she runs.

KING: As always, thanks to our whole panel.

As always head to our Web site, CNN.com/Larryking, take our quick vote or watch our Web exclusive with Magic Johnson. There's lots to see and read on our blog, too.

Suze Orman has an exclusive commentary for you as do the grandparents of Caylee Anthony. Susie and George and Cindy Anthony are our guests tomorrow night on LARRY KING LIVE.

But tonight, tonight it's time now for Anderson cooper and "AC 360." Anderson?