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CNN LARRY KING LIVE

The Latest on the Caylee Anthony Case; Illinois Governor Pressured to Step Down; Auto Industry Bailout

Aired December 12, 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, has the desperate search for little Caylee Anthony come to a heartbreaking end?
(BEGIN AUDIO CLIP FROM ORANGE COUNTY UTILITY)

UNIDENTIFIED MALE: This is Orange County utility in the emergency dispatch. We found a human skull.

UNIDENTIFIED FEMALE: Oh, my gosh.

(END VIDEO CLIP)

KING: Do remains found near the home of Caylee's grandparents belong to her?

Could they clinch the first degree murder case against her very own mother?

And then, are Barack Obama and his transition team feeling heat from the Illinois political corruption scandal?

The state's busted governor rejects calls for his resignation. Blagojevich says he's got plenty of stuff to spill, but not right now.

(BEGIN VIDEO CLIP)

DREW .

In Atlanta, , CNN SPECIAL INVESTIGATIONS UNIT CORRESPONDENT: Do you have anything to say?

GOV. ROD BLAGOJEVICH (D), ILLINOIS: I will at the appropriate time. Absolutely.

.

In Atlanta, : Are you going to resign, sir?

BLAGOJEVICH: I will have a lot to say at the appropriate time.

(END VIDEO CLIP)

KING: Plus, the Senate slams the brakes on the multi-billion dollar auto bailout and up to three million U.S. jobs could be at risk. Let the blame game begin.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: In essence, you're piling a lot of money and debt on top of a company that already has more debt than it can pay back.

RON GETTELFINGER, UNITED AUTOWORKERS PRESIDENT: It's just unfortunate that the Republican minority decided that they wanted to go against their own president.

(END VIDEO CLIP)

KING: Amid the accusations and mounting economic anxiety, will the White House take action?

All next on LARRY KING LIVE.

Good evening.

Caylee Anthony's grandparents, Cindy and George, who were here on Wednesday, were supposed to be our guests tonight. And we were told yesterday they would join us to share their reactions to that discovery of a child's remains near their home in Florida.

But circumstances have changed and now they're being advised not to appear on our show at this time.

Our panel in Orlando is Jessica D'Onofrio. She's the reporter for WKMG-TV.

In Los Angeles here with us, is our old friend Mark Geragos, the famed defense attorney.

In Miami, another old friend, Stacey Honowitz, the assistant Florida state attorney.

And in New York is Dr. Lawrence Kobilinsky, forensic expert and professor at John Jay College of Criminal Defense, who, by the way, has been consulting for the defense in the Anthony case.

All right, Jessica, what do we know right to this minute?

JESSICA D'ONOFRIO, REPORTER, WKMG-TV, ORLANDO: Well, Larry, we finally saw the Anthonies today. They've been coming and going from their home all day today. But they have not said a word to the media. They've been very quiet.

Last night, they were staying at The Ritz Carlton Hotel while detective detectives rifled through every room of their house, which I'm standing in front of right now. They emerged early this morning with several bags of evidence. They took out vacuum cleaners. They took out pesticide tanks. They are looking for any evidence inside that house that could be linked to the remains of a child's body found just a half a mile down the road from here.

Right now, they're trying to positively I.D. that body at the medical examiner's office. And that scene down the street will be released soon by the sheriff's office.

KING: Mark Geragos is -- there's no longer innocence -- presumed innocence, rather, constitutionally?

MARK GERAGOS, DEFENSE ATTORNEY: No. Not in -- in some, in a case like this, no. Absolutely not.

KING: Would you bet that these are the remains of the child?

GERAGOS: I...

KING: I mean, there's no way to know, but...

GERAGOS: There's no way to know. But, I mean, what a horrible thing if -- even if it isn't, that there's yet another child that's dead and decomposed in that same area.

But it would seem to be that it would be the obvious conclusion at this point. And they will know -- my guess is if they don't already know, that they will know within the next 12 to 24 hours. It doesn't take that long for them to do the DNA.

KING: Stacey, are these cases -- a parent killing a child -- tough to prosecute?

STACEY HONOWITZ, ASSISTANT FLORIDA STATE ATTORNEY: You know, I don't think they are tough to prosecute. And certainly in a case like this, we've watched this case unfold through the press for the last couple of months. We've seen the behavior of this mother. I mean, people were blaming her early, of course, even before this body was found.

So I don't think, in this case, you're going to have difficulty in prosecuting this mother against -- you know, with this child being the victim.

KING: Dr. Kobilinsky, you've been consulting for the defense.

How you to see it today?

DR. LAWRENCE KOBILINSKY, FORENSIC EXPERT, CONSULTANT IN ANTHONY CASE: Well, I think. This is a critical element now. I think things have changed. And I think that the defense strategy has to be planned accordingly. This is new information. It's a new time. And it's a tragedy. Whether it's Caylee or some other young child, it's clearly a tragedy.

KING: Authorities have released a 911 -- a tape of a 911 call made yesterday after a utility worker found what many believe are Caylee's remains.

Let's listen.

(BEGIN AUDIO CLIP FROM ORANGE COUNTY UTILITY)

(BEGIN AUDIO CLIP) UNIDENTIFIED MALE

Yes, we've -- this is Orange County Utilities Emergency Dispatch. We found a human skull.

UNIDENTIFIED FEMALE

Oh, my gosh.

UNIDENTIFIED MALE

I know. We've got a -- is it a meter reader?

UNIDENTIFIED MALE

Yes.

UNIDENTIFIED MALE

I'm going to let you speak right now with a representative from our field services facilities.

UNIDENTIFIED MALE

Hi. And everything is recorded. Here he is.

UNIDENTIFIED MALE

How are you doing?

A skull from the -- that we believe is human.

UNIDENTIFIED FEMALE

What's the location, please?

UNIDENTIFIED MALE

It's right off of Suburban and Chickasaw in the Caylee Anthony area...

UNIDENTIFIED FEMALE

Oh.

(END AUDIO CLIP)

KING: Jessica, is the presumption now that this is Caylee?

D'ONOFRIO: It really is, unfortunately, at this point, Larry. Investigators -- anyone who looked at that scene where the remains were, they could take, really, one look at it and see that this is really linked to little Caylee.

There was an article of clothing found in that bag. There were skeletal remains found in that bag. They also found duct tape wrapped around the skull of that small child.

And all evidence -- everything, initially, is pointing to the fact that it may just be little Caylee Marie.

KING: Mark, what on Earth would be the motive?

GERAGOS: Well, who knows?

And you can't even speculate. I've heard -- I've heard so many different theories and other things. You just never know.

And whether it's the mother or whether it's somebody else or whether it was an accident or whether it was a homicide and -- you just -- you can't ever guess.

The key to this case, I think, is going to come in what they do with the forensics and what they can find from the remains and whether they can determine how she died or -- and, you know, a good forensics person can probably do that.

KING: When we come back, we'll ask Stacey why the search of the grandparents' house.

Don't go away.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP FROM LARRY KING LIVE, WEDNESDAY, DECEMBER 10, 2008)

KING: When did you last see Caylee?

GEORGE ANTHONY, CAYLEE'S GRANDFATHER: I last saw her on June 16th, the day after Father's Day.

KING: What happened the day she went missing?

CINDY ANTHONY, CAYLEE'S GRANDMOTHER: We actually didn't find out until July. So...

KING: She had been missing how long when you found out?

CINDY ANTHONY: About a month.

KING: Isn't that strange?

CINDY ANTHONY: Well, not really. My daughter, you know, had her. And you know, we just -- we just assumed that Casey and Caylee were, you know, off visiting friends.

(END VIDEO CLIP)

KING: All right. Stacey Honowitz, why the intensive search of the grandparents' house?

HONOWITZ: Well, we know, really, this investigation is twofold -- first and foremost, it's to identify the remains so we can actually say this is Caylee Marie Anthony.

The second part is then to link up any of the evidence that maybe was found at that crime scene to anything in the Anthonies' house, because she was living at the house.

So, obviously, we know that there's duct tape. And we know that duct tape is a very good surface for fingerprints, for fibers. It's strong. It withstands under the weather.

And so, without speculating, obviously, these investigators found something in those remains, not just -- you know, connected to the bones -- that they think links up to something that's found in the Anthonies' house.

They applied for a search warrant based upon probable cause. They got that search warrant. And that's why they went back into the Anthonies' house.

KING: They're not suspects?

HONOWITZ: No, I don't think they're suspects at this time. I mean we all know and we've all said that maybe they're covering up some things, maybe there are some things that they know about that they're not talking about. But I don't think they're the focus of an investigation with homicide with her right now.

It's just that Casey and Caylee were living in the house. And we know that Casey had gone back to the house, had gone to the neighbor's house, had borrowed a shovel, had things in her trunk. And that's why they are revisiting that as a possible crime scene.

KING: Larry, attorneys say anthropological measurement of the remains are consistent with Caylee's.

What's that?

KOBILINSKY: Well, they -- they found -- first of all, they found hair in the plastic bag. And they also have the skull. Now they're making measurements -- fixed points on the skull. They're also looking at the dentition and comparing those measurements to what they see on a photograph.

And they're trying to determine whether they can exclude this skeleton as Caylee. And thus far, they have not been able to exclude the child.

The question is, can they include the child at what significant -- at what level, what statistical level?

And that will come, perhaps, when they get the DNA results. They'll know definitively whether this is the child or not.

KING: Jessica, how do you explain the incredible interest in this case?

D'ONOFRIO: It's really unexplainable, Larry. I've been covering this case since day one -- since Casey Anthony was arrested. And it's just grown from there. I don't think anyone ever thought that it would come to this, where national media would be here standing outside this Anthony home here in Orlando for such long periods of time. We had protesters here.

But I think the real crux of this whole case is people are just so emotional about it, because they see Casey Anthony and they don't see her showing any emotion over this.

KING: Yes.

D'ONOFRIO: And I think it has really whipped people up into a frenzy.

KING: Mark, the state withdrew the idea of the death penalty.

Why?

GERAGOS: I think that, generally, it's a more rare case where you seek a death on a mother when the mother is charged with killing a child -- their own child. It's rare for a jury to impose it. It causes all kinds of problems.

And why go through the extra rigmarole?

I mean, the death penalty, in large part, I think is -- is problematic.

KING: Because the case in Atlanta, this man went into a court, shot the judge, shot other people and they deadlocked today...

GERAGOS: Yes, they deadlocked on he...

KING: ...on whether he should get...

GERAGOS: Exactly.

KING: And he will get life.

GERAGOS: The idea of expending all of these resources in death penalty case is just so silly, I think, in a -- you know, in a -- from an economic standpoint. If you have that alternative of life without parole, that's, in some ways, I think, more horrific than death.

KING: We'll be back with more.

Don't go away.

(COMMERCIAL BREAK)

KING: Casey's parents, George and Cindy, joined us a few nights ago. We discussed the recorded jailhouse conversations they had with their daughter.

Take a look.

(BEGIN VIDEO CLIP FROM LARRY KING LIVE, WEDNESDAY, DECEMBER 10, 2008)

(BEGIN VIDEO CLIP)

CASEY ANTHONY, MOTHER OF CAYLEE ANTHONY: My only concern is that Caylee comes back to us and she's smiling and she's happy and that she's -- that she's OK.

CINDY ANTHONY: OK.

What do you want know tell Caylee?

CASEY ANTHONY: That mommy loves her very much and she's the most important thing in this entire world to me.

(END VIDEO CLIP)

KING: George, why wouldn't your daughter call you and say Caylee's gone?

GEORGE ANTHONY: That's really a good question. I -- I know we kept in contact with her -- at least Cindy did -- almost every day or every other day, a little text message here. And everything was fine.

KING: So what do you make of it?

I mean, she's your daughter. You have to have some why wouldn't she not -- why would she tell you, not tell you?

CINDY ANTHONY: I think she's -- I think she was frightened. I think, from what we understand that, you know, there's been threats to not only Caylee's well-being, but also to our family's well-being.

KING: By?

CINDY ANTHONY: By the people that have Caylee.

(END VIDEO CLIP)

KING: If the remains were found less than a half a mile from the home, why weren't they found sooner?

Answers, when we come back.

(COMMERCIAL BREAK)

KING: All right. Stacey, earlier today, a judge denied a defense request that its experts be present for the autopsy and the initial testing of the remains.

Here's part of the prosecutor's argument against that request.

(BEGIN VIDEO CLIP)

JEFF ASHTON, ASSISTANT STATE ATTORNEY: The point I'm trying to make here is that, that additional respect that we give to the dead carries over into this case. What I don't want to see, bluntly, is five minutes -- I'm sorry -- 24 hours after viewing an autopsy a defense expert on a national news show describing this child's remains.

When Dr. Henry Lee examined the vehicle -- something as minimal as that -- within 24 hours, he was on a national news show describing what he had seen. And the specter of that is -- is nauseating to me.

(END VIDEO CLIP)

KING: Stacey, is that a good argument?

HONOWITZ: Well, obviously, it is, because the judge denied the motion. So the prosecutor really made his point. And the bottom line is everybody has been talking about this case. We're all on these shows -- you know, we're talking heads and we talk about all the evidence.

The fact of the matter is she hasn't been I.D.ed yet. And to have these strangers, basically, sitting in while the autopsy was going on, I mean it really shows a lack of respect.

Now, what the judge did do was -- I think that the protocol which the M.E.'s office uses, everything will be preserved. So that if the defense experts, after the autopsy, want to go in, the judge has ordered that all the evidence be preserved. And they'll have ample opportunity to review it.

So it kind of cuts both ways. They will have a chance to argue it.

KING: All right. It's possible that we should worry a prosecutor might release some of the information of what he or she saw.

GERAGOS: Well, yes. That's the kind of disingenuous part of that argument. It's usually the prosecutors who hold the initial press conference. It's almost always the prosecutors and the police who do the leaking initially.

And then when the defense comes along, then they want to scream, you know, you can't do this or we want to gag them or something else.

I don't necessarily disagree with the underlying feelings of the prosecutor in his argument. But there's a very simple solution to that and judges do it all the time. You can order that if the expert is going to go in there and he's going to do an examination, that he be covered under some kind of a protective order. And I -- I think that that's as simple a solution as to say not do -- not allow them to do it, especially, as Stacey says, ultimately, the defense is -- has the absolute right to go in there anyway.

KING: Dr. Kobilinsky, when do you think we'll know who this -- who this remains belong to?

KOBILINSKY: Well, Larry, I think if there was soft tissue that still remained intact, then we would know very quickly. We would probably know by now. So I'm -- my hunch is that there is insufficient soft tissue or it's highly degraded.

If it's from bone, it will probably take at least a week.

GERAGOS: Although if they've got -- if they've got hair, they can do mitochondrial DNA and they can -- they can link that up fairly quickly, as well.

KING: And based on where they were, do we know -- Jessica, do you know why they weren't found sooner?

D'ONOFRIO: Well, it's a good question, Larry. I mean we're just talking -- these remains were found blocks -- within walking distance of this house. There are people saying that it was underwater at a certain point in time. But then when Tropical Storm Fay came through -- and that might have submerged those remains.

But when the search was going on for the body initially, we didn't have any rain out here in Central Florida. It was completely dry.

KING: Yes.

(CROSSTALK)

D'ONOFRIO: They had the cadaver dogs out here. So...

KING: Yes.

HONOWITZ: Larry...

KING: Well, obviously, we're following it.

Quickly, Stacey. Yes, go ahead.

HONOWITZ: Tim Miller from EquiSearch came on. He said it was completely underwater. They couldn't go through. He didn't want anyone to walk through and maybe disturb something that -- that was there.

KING: I got you.

HONOWITZ: And that's the reason they didn't do it.

KING: Thank you.

Thank you all very much.

We'll be calling on you again.

When we come back, why won't Governor Blagojevich resign?

We'll have some answers.

Stay with us.

(COMMERCIAL BREAK)

KING: Welcome back.

Despite the firestorm of political scandal surrounding him, Illinois Democratic Governor Rod Blagojevich was on the job again today. His chief of staff, though, wasn't.

Just three days after he and the governor were arrested on a mind-boggling array of corruption charges, John Harris resigned. And around the time Harris bailed out, Illinois Attorney General Lisa Madigan asked the state supreme court to declare the governor unfit to serve so that the lieutenant governor can step up and take charge.

We welcome to discuss this, in Washington, Clarence Page, syndicated columnist "Chicago Tribune." He's also a member of the paper's editorial board, so he may have been targeted.

Here in Los Angeles, Arianna Huffington, co-founder, editor-in- chief of The Huffington Post. Her new book is "The Huffington Post

A Complete Guide to Blogging."

And in Atlanta, our old friend, Neal Boortz, the nationally syndicated radio host and best-selling author.

All right, guys, CNN's investigative correspondent, Drew Griffin, caught up with the governor today and got these comments.

(BEGIN VIDEO CLIP)

DREW .

In Atlanta, , CNN SPECIAL INVESTIGATIONS UNIT CORRESPONDENT

Drew Griffin with CNN.

Can you say anything to the people of the State of Illinois, sir?

Do you have anything to say?

GOV. ROD BLAGOJEVICH (D), ILLINOIS

I will at the appropriate time, absolutely.

.

In Atlanta,

Are you going to resign, sir?

BLAGOJEVICH

I'll have a lot to say at the appropriate time.

.

In Atlanta,

Governor, are the authorities right in their petition, that criminal complaint?

Did you do what they say you did?

Governor?

Just 30 seconds for anybody from the State of Illinois?

(END VIDEO CLIP)

KING: That was revealing.

Clarence, it's going to be hard to remove him, isn't it?

This is not going to take overnight.

CLARENCE PAGE, SYNDICATED COLUMNIST, "CHICAGO TRIBUNE": Not at all. And Lisa Madigan's move was a dramatic, radical, unprecedented move. We're not even sure if the supreme court is going to go along with it. Her argument is that the constitution allows the removal of a governor who is disabled.

She's taking a very, very broad definition of disabled. Legal scholars aren't real enthusiastic about backing her up on this.

The general assembly is meeting the first of the week to discuss what to do with him, including begin impeachment proceedings. They're only meeting for two more weeks and then their next session starts -- they'll have to start all over again.

But Blagojevich, I don't know, I think he might be holding out for a plea bargain of some kind, which he can make with the U.S. attorney more easily from the sitting position of governor.

KING: Arianna, where do you think this is going?

ARIANNA HUFFINGTON, EDITOR, "THE HUFFINGTON POST": Well, I think it's amazing, actually, to look at what brought him to this place. I mean there is a sudden pathology here. And far too many very articulate people have been reduced to calling him crazy. David Gergen said I'm calling him the idiot. You know, because this kind of behavior cannot just be explained politically. It has to be explained psychologically.

I went back that my old compatriot Heracles, who, two-and-a-half thousand years ago said character is destiny. And there is something about this governor's character -- but, in a way, maybe it's almost inevitable that he would end up with a 76-page criminal indictment. And it's fascinating.

KING: Do you see anything in his history that would have led to this?

HUFFINGTON: Well, yes. There is so much in his history. If you look at articles done about him, he was constantly described as a crook, as delusional, as somebody who is completely amoral. But now, just think of it. This is a man who knew that he was under federal investigation. So he knew that his calls could be monitored. And yet that's what he said on them.

KING: Neal Boortz, what's your read?

NEAL BOORTZ, TALK RADIO HOST: OK. A couple of thoughts.

First of all, when you talk about the constitution saying he could be removed if he's disabled, I think they're talking physically or mentally, not politically. He's certainly politically disabled at this point -- at this point.

And I agree, he's probably holding onto that office because what other bargaining chip does he have at this point?

And as to why he engaged in this behavior, I don't think it takes any -- being delusional or mentally imbalanced. He's a part of Illinois and Chicago politics. This is par for the course in the eyes of some people. And you get this feeling that you're bulletproof. So, hey, I -- you know, I can get way with this. There's many people before me that did.

KING: Clarence, Obama's incoming chief of staff, Rahm Emanuel, won't say if he's the president-elect adviser referred to in the criminal complaint against the governor. Sources says Emanuel has been told he is not the target of a federal probe.

How is this going to impact him?

PAGE: Well, as long as he's not a target or even a subject, which is -- those are two different legal terms. A target is somebody who's about to be indicted. A subject is somebody who is just being investigated.

But we don't have any indication of that. And Fitzgerald, so far, has said there was nobody else who was in line to be a target. The investigation is ongoing.

Now, he's also denied that he was the one who dropped the dime on Blagojevich -- that he had called U.S. attorney after Blagojevich had made some kind of appeals to the Obama team.

So we don't know. A lot of things could happen.

But, otherwise, right now, the Obama team seems to be only connected to Blagojevich by the fact that they are Illinois Democrats. And, Neal, there are some who are reformers.

(LAUGHTER)

KING: All right.

Jesse Jackson, Jr. , by the way, another target -- if target is the right word -- spoke with CNN's Don Lemon earlier today and had this to say. Watch.

(BEGIN VIDEO CLIP)

REP. JESSE JACKSON (D), ILLINOIS: The governor not only cannot perform his functions under the Constitution of the State of Illinois, but has clearly violated a number of statutes under -- our state statutes and potentially federal statutes. And there may be a capacity issue.

DON LEMON, CNN CORRESPONDENT: What do you mean?

JACKSON: A capacity as in a mental capacity to complete the job. He cannot function under the duress that he is presently functioning under.

(END VIDEO CLIP)

KING: Based on perception alone, Arianna, can we say that Congressman Jackson has no chance to be the next senator from Illinois?

HUFFINGTON: Yes. I would say he has no chance. What is interesting, Larry, given what you said earlier, is that it is the media that tried to make a connection between this major scandal and Barack Obama. There is no connection. And it is not because I say so. Patrick Fitzgerald said so unequivocally. He said the complaint makes no allegations whatsoever about the president-elect.

KING: What media said so?

HUFFINGTON: The media constantly trying to find a connection. They are trying to say what happened. What happened with advisers? Why did he say he had no contact when in fact he had shaken his hand at the governor's conference? And why was Rahm Emanuel beet red? That's what an ABC journalist said this morning when Emanuel let him go to his house to go to the bathroom, beet red. I was talking to his brother Ari Emanuel who said, he hasn't been beet red since my mother gave birth to him. He's rather suave. So that's the kind of exaggeration that tries to create an atmosphere around the Obama camp that is completely illegitimate.

KING: And I'll ask Neal Boortz about that. By the way, don't forget our blog, CNN.com/LarryKing. We read all your comments. We'll be right back.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

UNIDENTIFIED FEMALE: In light of his arrest and the filing of the criminal complaint, Governor Blagojevich can no longer fulfill his official duties with any legitimacy. I recognize that this is an extraordinary request, but these are extraordinary circumstances.

(END VIDEO CLIP) KING: Neal Boortz, what is the effect on Obama?

BOORTZ: Well, I think it is absolutely natural right now that people are going, I don't see a connection. Sure, somebody in the Obama administration may have talked to him. Why not? He's the governor of Michigan. Obama is from Michigan. There is a Senate seat to fill.

But I think it is natural that the media is going to be curious about this. One thing I'm curious about, however, is why the Democrats are forming a firing squad in front of the Michigan governor when people like -- in the meantime --

KING: Illinois governor, you mean.

BOORTZ: The Illinois governor. At the same time, they're setting up a defensive posture around people like Charles Rangel. Why are they so anxious for this guy to just go away?

KING: Clarence, is that a fair question?

PAGE: In answer to the first question in regard to the media, yeah, media are very curious. But I think Arianna makes a good point in that some media have been trying to make another Whitewater out this because they would rather cover this than cover Obama's appointments and the rest of the transition. That's pretty dull stuff, global warming, economic collapse, pretty dull stuff next to this story.

BOORTZ: Since Watergate...

PAGE: There is a resemblance to Whitewater in the timing of all this. And you can pin one state and say oh, that state is corrupt, whether it is Arkansas or Illinois, which, by the way in "USA Today" survey the other day found out we were the 18th most corrupt state. I want to -- I demand a recount myself.

BOORTZ: Congratulations. That's better than I thought you would do, yeah.

KING: Arianna, you want to chime in?

HUFFINGTON: But you must admit Larry, it is quite extraordinary to have a state where the preceding governor is in jail, former Governor Ryan.

PAGE: And we may have two governors in jail.

HUGGINGTON: The current governor may also be in jail. It is not surprising. And as for clemency, for his predecessor, it's as if he knew that somehow he might be needing clemency too.

So it is an amazing story. I can understand the media following it. But it does not affect President-elect Obama and even the governor himself said so when he said, you know, they're not offering me anything except appreciation. Bleep them. BOORTZ: And we trust him now, don't we?

HUFFINGTON: He didn't say for you and me to hear it. He said it when nobody he believed was listening.

BOORTZ: Why did you talk when nobody is listening?

PAGE: He did Obama a big favor with that little statement.

BOORTZ: Yes.

KING: Neal, after all, this is the state of Lincoln.

BOORTZ: Well, yes. We heard that a lot over the last couple of weeks too.

PAGE: My newspaper endorsed him, by the way.

BOORTZ: Endorsed Lincoln?

PAGE: Yes. We actually went; we sponsored his entry into the Republican Party.

BOORTZ: And I remember talking about him a lot on the show as I'm sure Larry does.

KING: He was great guest. He was also a good guest, always responsive.

BOORTZ: Better on radio than TV.

HUFFINGTON: And I'm sure according to Patrick Fitzgerald, he's turning in his grave, right?

BOORTZ: He's a little paranoid, right?

KING: Thanks, guys. We'll have you back, Clarence Page, Arianna Huffington, Neal Boortz. Right back with the head of the United Autoworkers. Oh, by the way, Neal is coming back with us in a little while. Don't go away.

(COMMERCIAL BREAK)

KING: Joining us now for some moments in Detroit, a return visit with Ron Gettelfinger. He's president of the United Autoworkers. The bailout dead in the Senate. Do you expect the White House to come through for you?

RON GETTELFINGER, PRESIDENT, UNITED AUTOWORKERS: Hi, Larry, yes. We're very hopeful that they will. At this point in time, that's the only chance we have got.

KING: Are you -- it seems odd that the Republicans in the Senate that voted against you come from states where there are plants with foreign companies having plants and know the scale of union pay there is no union, was much lower. Do you tie that? GETTELFINGER: Well, you know, we hear a lot of different reasons for why this went down and obviously a lot of people have their own opinions. But the fact that you stated are what they are. However, I'm not sure, you know, a lot of people have brought politics into it and said, well, because the union supported Democrats. But you know, most of the auto executives support the Republicans.

I'm really not sure what the rhyme or reason is for what we're doing here. We have done everything from our standpoint to try to make these companies successful. And we were just hopeful we would be able to get the bipartisan legislation out of the Congress.

KING: What do you think's going to happen?

GETTELFINGER: Well, I think the president put out a very positive release from the White House earlier this morning. I think now Treasury Secretary Paulson is taking a look into the situation. Obviously he's got the plans that the companies submitted to the Congress on December 2nd. And hopefully he can move rather quickly because it is imperative that this emergency bridge loan money come forward so that it just rests everybody from a standpoint of knowing that these industries and these companies are going to survive.

KING: What are the rank and file telling you?

GETTELFINGER: well, people are very nervous and very concerned right now and rightfully so. And very disappointed in what happened in the Republican caucus last night, in the Senate. In fact, a lot of people are extremely upset. But people also trust the system. They were pleased to hear what the president's statement said this morning. And just hopefully the treasury secretary will move this agenda forward.

KING: We'll keep in constant touch with you. Thank you, Ron. Ron Gettelfinger, the president of the United Autoworkers. When we come back, a major panel discussion on this very topic. Don't go away.

(COMMERCIAL BREAK)

KING: OK. We know the auto bill died in the Senate. We'll get into all of that with Ben Stein, the noted economist, former presidential speech writer, "New York Times" columnist as well and best-selling author. Remaining with us from Atlanta is Neal Boortz, the nationally syndicated radio host and best-selling author himself. He opposed the bailout, by the way. In New York is Congressman Charlie Rangel, Democrat of New York, chairman of House Ways and Means. He was for the bailout. And in Washington, Representative Mike Pence, Republican of Indiana. Mike is the incoming chairman of the House Republican Conference and he voted against the bill. Ben, what happened?

BEN STEIN, ECONOMIST: Well I think what happened was that the Republicans were sick of the bailout and they were also sick of the idea that the autoworkers had voted Democrat so many times and turned Michigan into an entirely Democratic state and they're also a little envious on behalf of the constituents of the way -- the imaginary super wage benefit legacy cause.

But I think they made a terrible and unpatriotic mistake. We're teetering on the brink of a depression. We can ship money to Iraqi warlords and giant cargo planes. We ship money all over the world. We can't ship it to help our own people? We can ship it to Goldman Sachs and rescue people that get $100 million a year but we can't rescue an autoworker and his family? That's crazy.

KING: That sets the scene. We'll get with the rest of the panel after we talk with Anderson Cooper, who will host "A.C. 360" at the top of the hour. Anderson, what's up?

ANDERSON COOPER, CNN ANCHOR: Larry, we're following the breaking news you've been talking about, new information on Rahm Emanuel and the Governor Blagojevich scandal. Is President-elect Obama's chief of staff in any way the target of investigators? He's not talking, but our sources are. We'll tell you what we know tonight. Plus, the death of the $14 million auto bailout. Did it come down to a civil war style battle between the senators from the north and the south. And one of Wall Street's biggest money makers brought down, charged with security fraud after cops say he confessed to a $50 billion scam. Wait until you hear who turned him in. And my interview with the greatest Olympic athlete ever, gold medalist Michael Phelps. Those stories and more Larry, on "360" tonight.

KING: Thanks, that's Anderson Cooper, 10 Eastern, 7 Pacific. Back to the panel. Neal Boortz, why do you think Ben is wrong?

BOORTZ: Well, how did you know I thought he was wrong? Look, he was right right there at the end. He was talking about bailing out the workers. That's what this is. It isn't an automakers bailout, it is a workers' bailout.

Let's see who was it, Barney Frank today, called it a welfare bill, essentially. I mean, he didn't use those words, but Lesley Stahl in an interview to be broadcast this weekend called it a welfare bill. And Barney Frank says, well don't you believe in welfare? Do you think people should starve? That's what this has been all along, welfare for union workers.

And whether they turn down this deal to, hey, promised by the end of 2009, your wage and benefits will be in line with Nissan, Toyota, Hyundai, they said no. Then I think it died a very well-deserved death.

KING: Charlie Rangel, why was it deserved? Why was the bailout deserved, not the death?

REP. CHARLIE RANGEL (D), NEW YORK: Well, you know, Neal calls it welfare. Imagine what he will call a trillion dollars to our bankers.

BOORTZ: Barney Frank calls it welfare.

RANGEL: The truth of the matter is, I think this could be the president's finest hour. His legacy will no longer just be the war and the failed crisis but he saved the manufacturing base of the United States of America. You know, being for workers is not an unpatriotic thing. It is workers and the middle class that makes our country so great. And it just seems to me every country in Asia and Europe, they have no hesitancy to be of assistance to their manufacturers.

I think the president is going to do the right thing. I think we're got to rebuild the system. This is not first time America had a setback and we once again can be the strongest automobile industry in the world.

KING: Congressman Pence?

REP. MIKE PENCE (R), INDIANA: Well, Larry, there is no question I was in Indiana much of today, talking with automotive suppliers. We had a long tradition in the automotive business in the Hoosier State. There is a very real crisis. Congress is right to act. The president is right to act.

But the American people know we can't borrow and spend and bail our way back to a healthy automotive industry any more than a healthy economy.

I heard a bit of Ben's comments. And Charlie's, of course. But, you know, I strongly opposed the $700 billion bailout. Thought it was wrong to take bad decisions on Wall Street and transfer them to Main Street. And I opposed and support the Senate's decision to oppose this $14 billion that would go to Detroit without creating the circumstances under which those companies could legally reorganize their business plan. And it did nothing to deal with the credit crisis that will be ongoing in 2009.

STEIN: But it is going to do a lot to deal with the onrushing depression business. That's the problem. The problem isn't the about business model of GM has failed. We know its failed. The business model of Goldman Sachs has failed. We've got a lot of failed business models.

What we are having is an onrushing depression. We have got to stop it now. We have got to have a government contra-cyclical action that stops it. If we fall off a cliff into depression, it will be so much worse than any of the bailout costs. You cannot imagine it. You do not want to let this go into Great Depression.

PENCE: Ben, I'm not suggesting, I guarantee you Senate Republicans and House Republicans are not suggesting we let the patient go into a depression.

What we ought to do, though, is rely on the institutions in our society that exist to give businesses the opportunity to reorganize and to restructure their business plan.

Now, I really do believe that what Congress should do is what House Republican leaders represented this week and that is we ought to extend the jurisdiction of the federal courts and allow these companies to engage in a court supervised reorganization and then encourage through government insurance more capital to flow in. We simply should not look to the American taxpayer for one bailout after another.

KING: Congressman Rangel is that suggestion of bankruptcy?

RANGEL: Bankruptcy will be the end of the business. No one wants to buy a car from a bankrupt corporation. But it seems like the Senate Republicans had a much higher demand for sacrifice of our workers in these plants than they did when the CEOs were coming by the Senate.

I really think at the end of the day, the senators from the south wanted to put a death knoll on the United States trade union movement and nothing else.

BOORTZ: Oh yeah, it's a southern problem.

RANGEL: Neal, I just want to point out something to you.

KING: One at a time.

RANGEL: I want you to know Neal that three irresponsible reporters have made allegations against me and I have referred it to the ethics committee. So all of this protection, the only thing that could protect me is honesty and fairness. I wish you'd apply just a little bit of it.

BOORTZ: Well let's be honest about this debate though, if we can.

KING: Neal, Neal, go ahead, Neal.

BOORTZ: Charles Rangel just said nobody would buy a car, these people going into bankruptcy. I'm sorry, just today about eight hours ago, I went to a Chevy dealer here in Atlanta and bought a brand new Chevrolet. I have confidence in the industry, but we are on the verge of throwing $14 millions or $15 million at them now and then when they -- after the transition takes place in January, another $35 billion. And before it's all over, we'll put $100 billion into the industry.

HENCE: One of the experts testified...

KING: Ben?

STEIN: Neal, with all due respect, that is pennies compared to what it cost us if we go into a genuine depression. Genuine depression costs trillions and scars generations. We have got to stop this right now.

KING: Let me --

(CROSSTALK)

KING: You'll get in. You'll get right in as soon as we come right back. Don't go away.

(COMMERCIAL BREAK) KING: Obviously, gentlemen, we're going to be doing a lot more on this. So if we don't get everything in tonight, there's a lot more coming. But Mike Pence, we pick back up with you.

PENCE: Yes, I just want to agree with something that Charlie said a moment ago. And that is that clearly we can't do or promote a traditional bankruptcy here. That would send the wrong message to the marketplace and discourage and discourage an already declining market from buying these wonderful vehicles.

But I don't think a bailout or a bankruptcy is the answer. But if the Congress was able to extend the jurisdiction of the federal courts for the specific purpose of a reorganization and power of a federal judge to bring all of these powers to the table with the authority to bring about the compromise, that's how we reorganize businesses every day of the week here in America, Larry.

KING: That sounds Ben Stein, logical.

STEIN: It sounds logical, except that who is going to be the lender? If a company goes into reorganization, there has to be somebody has to put up a huge amount of money for the reorganization. Who is that going to be?

PENCE: We actually addressed that Ben, in the Republican Leaders' Proposal in the House. We suggested that you create a government insurance program that covers up to 50 percent of the default loss and you encourage private investment to come in as debtor in possession financing. You're right. More than $100 billion as some experts say that Detroit needs is going to be hard to raise in this credit environment. But if we create an FDIC-style insurance program, that money will flow in and Detroit will come back stronger than ever before.

STEIN: Why don't you cover all of it and really get the thing rolling?

KING: Charlie, what do you think?

RANGEL: I don't think that's off the table. Include it in the bipartisan agreement that we had with the president that passed the House and went to the Senate. Included a car czar that had the opportunity to prepare in case we had to go into bankruptcy. But what we want to do is really give the creditors, the suppliers, the CEOs and the union leaders an opportunity to come together and get this thing right. Bankruptcy is not off the table, but this bridge loan can avoid that.

PENCE: Well, I think bankruptcy should be off the table, Charlie. I think we ought to have a reorganization entirely. As far as having a car czar, I think you'll have as much success reaching compromise without a federal judge involved as they did the other night in the Senate.

KING: Neal? BOORTZ: Real quick, first of all, to address Ben's concerns about a depression, there are a lot of ways to address the possibility of a depression other than pouring trillions, billions of taxpayers' money into a business that may not make it.

If we're so worried about a depression, why aren't we worried about some really comprehensive tax reform right now to attract business and industry back to this country?

And that is one way to fore stall that. And as for the bankruptcy, I rather like Congressman Pence's solution. I used to practice law and I did a lot of bankruptcy law.

It sounds to me like that might be viable. But a car czar? If the feds can come up with somebody that is that good, he ought to be working for the automobile companies in a private capacity right now.

(CROSSTALK)

STEIN: Well, we've solved the problem. Put them into reorganization, have the government guarantee the debtor and possession financing and go at it without a car czar. So we solved the problems and I think we should all get Cadillacs.

BOORTZ: And tax reform.

STEIN: We don't need tax reform right this minute.

BOORTZ: Oh, yeah, we do.

KING: Charlie, do you expect the White House to come through?

RANGEL: Listen, I think this president is going to leave a legacy that is going to be proud of this. There's no question. I don't think he has an option. It's national defense, it's the patriotic thing to do. If we ever need cars and tanks and a mechanism for America to move forward, the president has this authority to do it.

KING: Do you think -- whatever your opinion, Mike, do you think Bush will come through?

PENCE: Well, I have a strong sense that the administration is willing to open up what was financial services bailout for this. But Larry, I've got to tell you, I think that's a profoundly bad idea. I think the line of struggling businesses that will now want access to that $700 billion fund will go from Washington, D.C., to the Golden Gate Bridge.

I think the president was right in the first instance to say no. The financial services resources ought to go to strengthen our credit markets and we ought to come back into session -- Charlie, you and I ought to come back into session this week and come together around a plan that would give these companies the tools and the resources to reorganize without burdening taxpayers.

(CROSSTALK)

RANGEL: Well, if the president calls us back, we're ready to come back and do it, but it just seems to me that the worst thing in the world is to have 3 million people join the unemployment line.

STEIN: I absolutely agree, absolutely right. The government shoved tens of billions of dollars down the throats of banks who said, we don't even want it. Now Detroit and the workers there who are decent Americans are begging for it. For gosh sake, let's do the right thing.

PENCE: I think we should do the right thing, but I don't believe one more bailout is the right thing, Larry.

BOORTZ: And one more thing, it's very quick. None of this happens with the UAW in the picture. The union has to be busted.

RANGEL: Now, that's the Republican theme. That says it all, Neal.

KING: Thank you all very much.

BOORTZ: Absolutely it says it all.

KING: All right, thanks, guys. Go to CNN.com/LarryKing for guest lists, transcripts and our quick vote. Send us an e-mail, ask a question or download our latest podcast. You can go to CNN.com/LarryKing. It's all there all the time, including our blog. Monday night, Jim Carrey is here. And Tuesday, Sarah Jessica Parker and Alec Baldwin stops by next week. Stopping by right now is Anderson Cooper and "A.C. 360." Anderson?