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Bush will release remaining TARP, if Obama asks; Roland Burris's lawyers to meet with Senate lawyers; Hollywood awards season started with Golden Globes

Aired January 12, 2009 - 11:00   ET

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

TONY HARRIS, CNN ANCHOR: Good morning, everyone. I'm Tony Harris. And you are in the CNN NEWSROOM.
Three hundred fifty billion dollars of your tax dollars remaining in the financial bailout fund. President Bush said today he has no plans to request the additional money from Congress unless President- elect Barack Obama asks him to. If that happens, the new administration could have the money available when the president-elect takes office. And he's promising more oversight of the so-called TARP money.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT-ELECT OF THE UNITED STATES: Keeping flow of credit is critical, and we had to do something last fall. I, like many, are disappointed with how the whole TARP process has unfolded. There hasn't been enough oversight. We found out this week in a report that we are not tracking where this money is going.

(END VIDEO CLIP)

HARRIS: The Obama team trying to reassure lawmakers about plans for doling out the remaining bailout dollars.

White House Correspondent Suzanne Malveaux joining us live now.

Suzanne, good to see you.

SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Good to see you, Tony.

HARRIS: We know that the president-elect's team had a meeting with congressional Democratic leaders over the weekend. My guess is the stimulus package and spending the TARP, and how to get the most bang from both, was at the top of the agenda.

MALVEAUX: Absolutely. And what you're hearing from President Bush and President-elect Barack Obama, they're really on the same page when it comes to this.

It wasn't surprising that President Bush, he has not yet asked Congress for the money, but what he said was if Barack Obama asks him to do that, then he will. And what you're seeing is Barack Obama and his team quietly trying to win over members of Congress first. Those Senate Democrats meeting with Larry Summers, his top economic adviser, to make sure they're on board with this. They're trying to avoid a political mess here where you'd have either President Bush asking for the money and Congress rejects it, and Bush has to go back with a veto, or, actually, Barack Obama having to veto that legislation, as well. So that is what you're seeing, kind of these back-door discussions taking place to make sure that when President Bush does ask for that money, that this goes over well with members of Congress.

Tony, got to tell you, very interesting press conference, final press conference from President Bush. I want you to take a listen to really kind of how defiant and adamant he was when it came to talking to Barack Obama about some of the threats that he's going to face once he takes office in eight days. Take a listen.

(BEGIN VIDEO CLIP)

GEORGE W. BUSH, PRESIDENT OF THE UNITED STATES: I wish him all the best. And people say, oh, that's just a throwaway line. No, it's not a throwaway line.

The stakes are high. There is an enemy that still is out there. You know, people can maybe try to write that off as, you know, he's trying to set something up. I'm telling you, there's an enemy that would like to attack America and Americans again.

There just is. That's the reality of the world. And I wish him all the very best.

(END VIDEO CLIP)

MALVEAUX: So, Tony, really an ominous warning to Barack Obama. But Barack Obama, he has all of the intelligence now. He is getting those daily intelligence briefings, just as President Bush has.

And President Bush very defensive when it came to the question whether or not the U.S. had somehow lost its moral standing in the world. He said remember those times, those press conferences after the September 11th attacks, when all of the questions started coming about, well, why didn't you see it, and why are you not connecting the dots and you are connecting the dots?

President Bush very defensive about this. He did acknowledge some errors, some mistakes, some misgivings along the way. But Tony, he was totally unapologetic when it came to that threat, what he says was is a real threat that Barack Obama has to face.

(BEGIN VIDEO CLIP)

BUSH: Why me? Oh, the burdens, you know. Why did the financial collapse have to happen on my watch? It's just pathetic, isn't it, self-pity? And I don't believe President-elect Obama will be full of self-pity.

(END VIDEO CLIP) MALVEAUX: So, Tony, what you are hearing is kind of President Bush mocking, if you will, some of the past presidents and leaders, folks who he says, look, this isn't about self-pity. That that's pathetic. This is what he's dealing with.

He mentioned the financial crisis, as well, saying that he chucked aside, in his words, free market principles because he said he was warned that it would be worse than the Great Depression if they didn't do anything. So, obviously President Bush quite defensive about how he's handled the economy, as well as events on the world stage.

HARRIS: I thought there were some extraordinary moments in that final news conference with the President. And we'll get to more of them throughout the morning here in the NEWSROOM.

Suzanne, appreciate it. Thank you.

Back to the TARP program for a moment.

You know, there are a lot of questions about where the first $350 billion of the bailout went and whether any of the remaining money will be used to help homeowners facing foreclosures. We put those questions to Professor Elizabeth Warren, chairman of the Congressional Oversight Panel for the bailout fund.

(BEGIN VIDEO CLIP)

HARRIS: Do we have the metrics in place? Do we have any idea, for example, if the money from the TARP program that's going to the banks is actually being used to make new loans to individuals, to consumers, to small businesses?

PROF. ELIZABETH WARREN, CHAIRWOMAN, CONGRESSIONAL OVERSIGHT PANEL: No.

HARRIS: No?

WARREN: No. What we know is the money has gone into the banks. That much we can track.

And what the banks have done with it, whether they have lent it to individuals and small businesses, whether they've used it to buy other banks, whether they've used it to buy assets overseas, or whether they've stuffed it in their vaults and locked the doors, no one knows. But let's be clear, no one asked them.

Treasury did not say, "Tell us what you're going to use with the money, what you're going to do with the money, tell us how you used it." That just hasn't happened. There's no basic accountability in this system.

HARRIS: The Obama financial team is considering a number of ways to alter the TARP program, along with Chairman Frank. You heard a bit of that just a moment ago with Campbell Brown. One of the tweaks being considered would allow bailout money to help some homeowners facing foreclosure.

My question is, isn't the language in the law already to do that? Is it clear that the second half of the TARP will, in fact, go to, in some way, mitigating foreclosures?

WARREN: You know, this is one of the stunning parts of the first $350 billion. The statute is pretty explicit that money from the TARP is supposed to be used, at least in part, for dealing with the mortgage foreclosure crisis.

Now, Congress, I think quite reasonably, didn't put big restrictions on it. They left it to Treasury to kind of work it out in good faith, not knowing exactly what the right way to do that would be. And Treasury's response on that particular part that they've been asked to do has been to do nothing.

So as I understand it, Chairman Frank is saying, look, if I have to, I'll fence off part of the money. I'll say that the only way you get access to this is if you're doing something to try to deal with the foreclosure crisis.

(END VIDEO CLIP)

HARRIS: More oversight for the bailout money. And President- elect Obama also pledges no earmarks or pork barrel projects in the economic stimulus bill.

House Speaker Nancy Pelosi agrees. She talked about the legislation with Wolf Blitzer on CNN's "LATE EDITION."

(BEGIN VIDEO CLIP)

WOLF BLITZER, CNN ANCHOR: So the $775 billion price tag, is that about something you like or...

REP. NANCY PELOSI (D-CA), HOUSE SPEAKER: Well, I'm not -- I'm not making any announcement about a number because we haven't finished with the legislation.

BLITZER: But you think you can get that done, you're saying, by mid-February, end of February?

PELOSI: It has to be. It has to be.

BLITZER: There's no way it could be done by the time he's inaugurated? You can't get it done in the House by then?

PELOSI: Well, when the package was smaller, we could, but the fact that the economy is worsening by the day -- 524,000 people lost their jobs in the month of December. Over, what, 2.6 million people lost their jobs in the year 2008. And as these numbers are revealed, the urgency is increased, the size grows, and it will take a little more time.

BLITZER: Might it still grow beyond the $775 billion? Is that what I'm... PELOSI: It might.

BLITZER: Really?

PELOSI: It might.

BLITZER: So you're still in a dialogue with the incoming administration?

PELOSI: Well, they're in a dialogue with the House and the Senate, and the president-elect has reached out to the Republicans, as well.

BLITZER: In this nearly $1 trillion legislation that you're talking about right now, can you assure the American people that there will be no pork barrel spending, none of these earmarks, these bridges to nowhere, these phony deals that are going on, that legislators wouldn't be able to bury stuff for their districts, the stuff that's been so highly publicized?

PELOSI: I can pledge to you that no earmark or any of that -- any description you want to make of it will be in the bill that passes the House.

BLITZER: Flat?

PELOSI: Absolutely flat out.

BLITZER: And you think you've got the support? Because, you know, this is the bread and butter for a lot of your members, Democrats and Republicans.

PELOSI: There will be no earmarks in the economic recovery package that passes the House.

(END VIDEO CLIP)

HARRIS: And we will make sure of that for you.

Issue number one, the economy. The 12-day streak of rising gas prices is over. AAA says a gallon of regular unleaded fell to a nationwide average of $1.79. That is down just a fraction of a penny. Pump prices began rising a few days after Israel opened its offensive in Gaza.

South Korean automaker Hyundai is cutting production as much as 30 percent. The first quarter pullback is in line with American and Japanese car companies.

The news comes a day after Hyundai's Genesis was named North American Car of the Year. At the Detroit Auto Show, Genesis is Hyundai's first foray into the luxury car market, the sedan, which tops out in the $40,000s, competes with Lexus and Mercedes.

The financial industry may open 2009 with another big deal today. Reports say Citi is trying to sell its brokerage unit to Morgan Stanley. The price tag may run as high as $3 billion.

Morgan Stanley became a bank last fall and tapped $10 billion of taxpayer bailout money. Citi has accepted $45 billion so far.

The recession may be driving more of you to drop a buck on the lottery. Of 42 states with lotteries, 25 report a jump in sales with scratch-off and daily lottery games. Experts say hard times lead some players to justify the spending. Interestingly, sales for those big money multi-state jackpots like Mega Millions and Powerball are down.

OK. We could we could find out today if Roland Burris will be seated in the Senate. Burris was picked by Illinois's embattled governor to replace Barack Obama.

Our Brianna Keilar on Capitol Hill.

Brianna, good to see you.

What is the latest on the story? What's happening?

BRIANNA KEILAR, CNN CONGRESSIONAL CORRESPONDENT: Well, today, Roland Burris' lawyers, not Roland Burris himself, but his lawyers, are going to be up here on Capitol Hill early this afternoon meeting with Senate officials. And Democratic sources say it's likely that Burris is going to get the news today on what Senate Democratic leaders have decided as far as his fate goes.

Now, one Democratic source told me he's likely to be very happy with the news he gets. But still, another one said, you know, not so fast, because there's still a big issue. And that is that even though Senate Democratic leaders want to seat Burris, there's this issue of the paperwork, Tony, which we've heard so many times before, the question of, does he have the appropriate documents as required by Senate rules?

He's got a couple of documents now. One is basically an adjusted certificate of appointment from Illinois Governor Rod Blagojevich, and this now no longer has that blank line where Jesse White, the Illinois secretary of state's signature should go. That line now gone.

But there is, as well, a second document. It's basically a certificate of receipt from Secretary of State of Illinois Jesse White, saying that this document has been received. So this is what lawyers are going over today. This is what Senate officials are talking with them about.

And if this paperwork is in order, Tony, then the expectation is this is really the big hurdle that Roland Burris would have overcome.

HARRIS: And we're not talking about the Senate perhaps delaying this further by waiting for the Senate in Illinois to hold its trial on the impeachment of Illinois's governor before seating Roland Burris?

KEILAR: We're not sure, but it does appear that Senate Democratic leaders, their main goal here is to do this quickly. HARRIS: Yes.

KEILAR: They don't really want to drag this out.

And, as well, you know, Tony, they talked about some other things. Do they then refer this appointment to the Senate Rules Committee?

HARRIS: The Rules Committee, yes.

KEILAR: Do they have a big vote including the full Senate? The bottom line here is they want to do this quickly, but then there are these Senate rules about the documents that they've kind of -- they're kind of painted into a box, so they're trying to get over that.

HARRIS: Yes, I think you're right.

All right. Brianna Keilar on Capitol Hill for us.

Brianna, thank you.

KEILAR: You bet.

HARRIS: Ohio Republican George Voinovich announced today he is retiring from the U.S. Senate. Voinovich plans to serve out his term, which expires in 2010. He will not seek reelection. Fellow Republicans Kit Bond of Missouri, Mel Martinez of Florida, and Sam Brownback of Kansas have also announced retirement plans in the past few weeks.

We are tracking your tax dollars from the TARP to the auto bailout. Your job, your life, it is our issue #1, right here in the CNN NEWSROOM.

(COMMERCIAL BREAK)

HARRIS: Israeli forces right now making their deepest push yet towards the center of heavily populated Gaza City. Day 16 of Israel's fierce offensive. Paratroopers report finding schools and homes booby-trapped with explosives. Hamas still managing to fire off its rockets. Palestinian medical sources now say more than 900 people have been killed, almost half of them women and children.

Israel reports 13 of its people killed, including 10 soldiers. The top U.N. human rights group today voted to condemn Israel over civilian deaths in Gaza despite western opposition.

Meanwhile, a boat loaded with humanitarian supplies is sailing today from Cyprus to Gaza. Protesters, doctors and lawmakers on board hope to break an Israeli blockade of the Palestinian territory. Their last attempt failed when an Israeli warship hit the group's boats.

Israel's prime minister says his country is nearing the goals it set, but Palestinian lawmaker Hanan Ashrawi, who does not support Hamas, has a very different assessment. She spoke to our Fareed Zakaria. (BEGIN VIDEO CLIP)

FAREED ZAKARIA, "FAREED ZAKARIA GPS": There are a lot of people who say in Israel, in the United States, that part of the strategy here that Israel is using is to hit Hamas so that it can build up the moderates, build up the Fatah in the Palestinian -- in the West Bank, which is where you are.

Do you think that the Israeli incursion in Gaza has strengthened moderates in the West Bank?

HANAN ASHRAWI, PALESTINIAN PARLIAMENT MEMBER: It has exactly the opposite effect. And I think this is the problem with Israel and with U.S. policy.

They have such a simplistic view and a surface view of Palestinian realities and culture, that they always do exactly the opposite of what they proclaim or what they publicly claim that they want to do. Right now the attack on Hamas is strengthening Hamas, it is strengthening people who are not just Islamists, but even beyond Hamas' Islamist extremists. It is undermining the voices of moderation and peace, and even regimes in the region because public opinion is inflamed. And it is showing, in many ways that futility of negotiations, and showing that people who have adopted this path have become helpless and have become complacent (ph) in many ways with this type of violence.

(END VIDEO CLIP)

HARRIS: President Bush today restated his position that a sustainable cease-fire in Gaza could only be accomplished when Hamas stops firing rockets into Israel.

Millions of you are looking for that next job. Personal finance editor Gerri Willis has her top tips. That's next.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

OBAMA: The sooner a recovery and reinvestment package is in place, the sooner we can start turning the economy around. We can't afford three, four, five, six more months where we're losing half a million jobs per month. And the estimates are that if we don't do anything, we could see four million jobs lost this year.

(END VIDEO CLIP)

HARRIS: Wow. The president-elect with a dire warning -- pass a multibillion-dollar economic stimulus package, or face more job layoffs.

You know, more than 2.5 million Americans lost their jobs in 2008. Probably a friend, a relative, a neighbor of yours has been impacted. Experts predict layoffs will accelerate in 2009. For some, retraining may be the only option. Personal Finance Editor Gerri Willis is here.

Gerri, great to see you.

GERRI WILLIS, CNN PERSONAL FINANCE EDITOR: Good to see you, Tony.

Let's start with, I guess, a straightforward question to you. Where can people get help?

WILLIS: Yes, this is a big deal, retraining. Look, an easy place to go for information, the Department of Labor.

It sponsors a Web site called careeronestop.org. You can find a list of industries with the largest employment and those what will grow the fastest. You'll also be able to find employment and wage information. There's also an education finder so you can locate the schools, the colleges that offer programs in your field of interest.

Now, if you don't have a computer, you can get this information over the telephone. Call 1-877-US2-jobs. CareerVoyages.gov is another site where you can find out where the jobs are.

HARRIS: Hey, Gerri, are community resources available?

WILLIS: Yes. Well, you know, and ones you know but may not have thought of, look, your local Goodwill organization is a good resource if you've been out of work for a long time, or if you have disabilities.

Goodwill organizations, they train folks for jobs in IT, health care, retail, banking, and even landscaping. And as part of its career services, Goodwill helps people conduct job searches, write resumes, practice their interviewing skills, all things you might have forgotten if you've been out of work for a while.

Now, while you're looking for that permanent work, job seekers can also be placed in temporary Goodwill jobs like the retail stores. And to find your local Goodwill, check out locator.goodwill.org.

HARRIS: Any advice for older workers?

WILLIS: All about the AARP, Tony. If you're over 55, you meet income requirements, AARP has a free senior community service employment program. It's called SCSEP. AARP staff will assess your job skills, connect you with training, help you update your resume, provide you with job leads. As part of the program, you'll also work part-time for a host agency like a job bank or a library.

Now, for more info or to find the program in your area, go to aarp.org, enter in this acronym, SCSEP, in the search tool.

HARRIS: OK. And Gerri, one final question for you before I lose you. What if you want to be your own boss? A lot of people thinking about taking some of their own resources and starting their own dream business. WILLIS: Right, and now is a good time to do it, actually. I know it sounds contrary to logic, but it actually is a good time.

Maybe go to the U.S. Small Business Administration Web site at SBA.gov. You can download online courses with topics that range from how to start your own business, to building your Web site, tips on winning customers in a down economy.

You know, you may have an advantage here. You may be able to underprice competitors if you're just starting out.

And if you have questions about money or your job, be sure to send me an e-mail to gerri@cnn.com. Love to hear from you. We answer your questions right here every Friday.

HARRIS: Terrific. Thank you, Gerri. Have a great day.

WILLIS: My pleasure.

HARRIS: Oh, and see you next hour. I know we're doing something else next hour that will be helpful to people watching. All right. See you then.

WILLIS: That's right.

HARRIS: All right. CNNMoney.com has advice and answers. Check out our special repot, "America's Money Crisis." That is at CNNMoney.com.

All right. News just in to CNN, $350 billion left in TARP. And guess what? President-elect Barack Obama has just requested President Bush to move forward with releasing those funds.

We will talk to our White House Correspondent Suzanne Malveaux in just a couple of moments.

Financier Bernard Madoff could have his bail revoked in the next hour. Coming up, an inside look into the scandal that has shaken Wall Street and its investors.

(COMMERCIAL BREAK)

HARRIS: Well, an interesting moment in the news conference, the final news conference for President Bush this morning.

We want to bring in our White House Correspondent Suzanne Malveaux.

Suzanne, good to see you again.

There was a question as to what the president was intending to do with the remaining funds in the TARP program, if he was, in fact, going to request that those funds be made available to Treasury. And the president indicated that that he was working in consultation with the president-elect and that he had not at that point received a formal request from the president-elect to do so, but we have some breaking news that you can share with us.

MALVEAUX: Absolutely. Right after the press conference, we had this development where Barack Obama has reached out to President Bush and said, yes, I want you to request the remaining money, the $350 billion of that bailout funding package there.

I want to read the statement real quick from Dana Perino, the press secretary. She said that "this morning, President-elect Obama asked President Bush to formally notify Congress on his behalf of his intent to exercise his authority under the Emergency Economic Stabilization Act to access that last bit, the $350 billion in funding for treasury programs, addressing the financial crisis.

"President Bush agreed to the president-elect's request. We will continue our consultations with the president-elect's transition team, with Congress on how to best proceed in accordance with the requirements of the statute."

What this simply means, Tony, is that President Bush, working with President-elect Barack Obama, will go to Congress and say, look, we need the rest of this money, we need it freed up and here is why. The next phase of this is to see whether or not Congress is going to reject this or if they're going to accept it. They've got 15 days to come up with a decision.

If they decide that they're going to go ahead and say, yes, we authorize this money to be released, well, then, we could actually see some of that money flowing days after Barack Obama becomes president. If on the other hand, Congress rejects it, President Bush could be in a position where he would veto, exercise his veto power over Congress, or he could leave it for Barack Obama to deal with that political mess and have Barack Obama actually veto the legislation when he gets into office.

Not the thing Barack Obama wants to do. Doesn't want to be faced with that possibility, and that is why you saw over the weekend Larry Summers, his top economic adviser, on the Hill in a rare Sunday session meeting with Senate Democrats to say, look, we're going to come up with the money. We're going to be transparent about it, how it's spent.

These are the kinds of back-door discussions, the things that they're talking about privately to make sure that this money not only signed off by President Bush, but Congress, as well -- Tony.

HARRIS: OK, our Suzanne Malveaux at the White House for us. Suzanne, appreciate it. Thank you.

All right, the votes have been counted and the winners announced. No we're not talking about last night's golden globes. We'll do that later. The car and truck of the year awards have been doled out. Which companies took the top prize? Susan Lisovicz at the New York Stock Exchange with the details. Susan, good morning.

SUSAN LISOVICZ, CNN CORRESPONDENT: Good morning, Tony. And you know, there is some connection with what Suzanne was talking about because you have to remember that GM and Chrysler have been given $17 billion of the original TARP allocation. And in the meantime, of course, you know, trying to sell vehicles right now is pretty tough. We do have the auto show taking place in Detroit.

And the industry's top awards are given out there. The Hyundai Genesis named car of the year. Hyundai's first attempt to launch a luxury car here in the U.S. Ironically, Hyundai also says it's cutting vehicle production due to slumping sales. Meanwhile Ford's redesigned F-150 named truck of the year. The F-150 has been the nation's top-selling vehicle for nearly three decades, but the new one is lighter and more fuel-efficient. Responding to the times.

HARRIS: Yes, yes. Well, you know, we often ask the question of whether or not you -- go back to the Golden Globes for a second, whether an award means something to the bottom line for a film. I'm just curious, will these awards help boost auto sales?

LISOVICZ: Well, you know, it's certainly priceless publicity, you know. It certainly won't hurt. But auto sales are after all, unlike movies, they're big ticket items and pretty much tied to the state of the economy. I don't think I need to elaborate on the state of the economy.

Ford's CEO says that if the economy gets worse, he may have to ask the government for some bailout money. We mentioned, you know, moments ago that the $17 billion so far went to GM and Chrysler. Now GM says it may need more cash from the government, and "The Detroit News" is reporting Chrysler is asking for an additional $3 billion.

Ford shares are down 2.5 percent. The Dow is knocked down by the same margin. Blue chips right now off nearly 1 percent. The Nasdaq's down 1 percent. Tony, back to you.

HARRIS: All right, Susan. Appreciate it. Thank you, Susan.

LISOVICZ: You're welcome.

HARRIS: From a luxurious penthouse to a jail cell, that could be where Bernard Madoff is heading. A New York City judge may rule shortly on whether Madoff should have his bail revoked.

Since he's been free on bail, he has sent more than -- listen to this -- $1 million worth of jewelry and gifts to family and friends. CNN special investigative unit correspondent Abbie Boudreau takes a closer look at the SEC's investigation.

(BEGIN VIDEOTAPE)

ABBIE BOUDREAU, CNN CORRESPONDENT (voice-over): Right now, the SEC inspector general, David Cotz, has just as many questions as everyone else.

BOUDREAU (on camera): Some members of Congress said that the SEC failed miserably. Do you think that's a fair statement?

DAVID COTZ, INSPECTOR GENERAL OF THE SECURITIES AND EXCHANGE COMMISSION: We haven't conducted our investigation yet, so --

BOUDREAU: But do you think that statement's fair?

COTZ: Once we complete our investigation, I'll be able to tell you, but I really do have to go.

BOUDREAU (voice-over): Cotz says he promises to find out exactly what went wrong, whether obvious red flags were missed.

(on-camera): But do you feel like the SEC dropped the ball in this case?

COTZ: I need to find that out after I finish my investigation.

BERNARD MADOFF, ACCUSED OF BILKING INVESTORS: Today's regulatory environment is virtually impossible to violate rules.

BOUDREAU: This is the only video that surfaced so far where you could hear what Bernie Madoff had to say. The roundtable discussion was about the future of the stock market. "Time" magazine business columnist Justin Fox (ph) moderated. He gave us one of the only glimpses into how Madoff says he ran his firm, and his admittedly cozy relationship with SEC regulators.

MADOFF: I'm very close with the regulators. I'm not trying to say they can't -- you know, that what they do is bad. As a matter of fact, my niece just married one.

JUSTIN FOX, BUSINESS COLUMNIST, "TIME": The thing about his niece being married to a regulator and all of that, yes, that's cringe-worthy after the fact. At the time, it was sort of, whatever.

BOUDREAU: Fox said he had no idea at the time he was sitting across from one of the world's biggest con men.

FOX: It was innocuous enough. I wasn't investigating the guy. There weren't obvious red flags.

BOUDREAU: Former financial reporter Michael Ocrant did see the red flags. In 2001, after being tipped off, he wrote the first news article to question the way Madoff was doing business. Ocrant recalls a conversation with one of his sources.

MICHAEL OCRANT, FINANCIAL REPORTER: He basically said, but he's either doing it through frontrunning, trading ahead of his customers as marketmaker, or it's a giant Ponzi scheme. And I just kind of said, come on, that doesn't make any sense.

BOUDREAU: Madoff invited him to his office to talk.

(on camera): And was he believable?

OCRANT: He was believable in the sense that how calm he was, how unplussed he was. He was just -- it was almost as if we were sitting down to Sunday tea. BOUDREAU: Ocrant's article was printed in May of 2001, followed by a second article in Barron's. But according to former SEC Chairman Harvey Pitt, neither ever got any attention.

(on camera): Did you know about these articles or is this the first you're hearing?

HARVEY PITT, FORMER SEC CHAIRMAN: No, this is the first I'm actually hearing about them.

BOUDREAU (voice-over): Pitt was chairman from 2001 to 2003. He started three months after the articles were published, yet he says his staff never alerted him.

PITT: If I had seen the articles, I believe that I clearly would have sprung into action on it.

BOUDREAU: The SEC examined Madoff's operations at least four times since 1999, and conducted two separate investigations, one in 1992 and the other in 2006, according to government officials. No fraud was ever found, even after the SEC received its detailed 19-page road map that uncovered Madoff's scam.

It was written by Harry Marcopoulos, a hedge-fund expert who concluded, "The world's largest hedge fund is a fraud." His tip even referenced Michael Ocrant's articles and contact information.

BOUDREAU (on camera): And the sec never contacted you?

HARRY MARCOPOULOS, HEDGE-FUND EXPERT: No. No.

PITT: I think that the SEC performed miserably in connection with Mr. Madoff. If I were grading this -- and I do teach law school from time to time -- I would give it an F.

BOUDREAU (voice-over): And from the sound of it, so would members of Congress, who wanted to know how the inspector general is going to lead the investigation.

REP. GARY ACKERMAN (D), NEW YORK: I want to know who is responsible for protecting the security investor, because I want to tell that person or those people whose job it is that they suck at it.

(END VIDEOTAPE)

HARRIS: Wow, that's pretty strong. Abbie Boudreau with CNN's special investigations unit joins us now. And Abbie, have you had a chance to speak with the current SEC chairman? That's Christopher Cox.

BOUDREAU: Christopher Cox. We've tried several times. We asked him several times to sit down with us for an interview, and every single time he said no. His press secretary told us it was due to scheduling issues.

HARRIS: Let me ask you a question that I hope that lot of people watching this unfold that they're asking of themselves. Can you explain how the SEC conducts two full investigations, two other inquiries, and is essentially given by an investigative reporter the blueprint for investigating Bernard Madoff, and yet there is nothing uncovered? It's not shut down.

I'm just sort of curious, was there an insider? And I know I'm going into conspiracy land here, but was there an insider working on Madoff's behalf inside the SEC? I can't be the only one who's thinking this.

BOUDREAU: No, I think that's a question that a lot of people are bringing up and a lot of people are wondering. But at this point in the investigation, there's absolutely no way to really know what's going on. I mean, the inspector general talked about this at the Congressional hearing and said, we are going to look into this. We're going to look into all of these different things.

And some of them are a little bit, you know, conspiracy theories and stuff. But you have to wonder that. I mean, and that's what some members of Congress were asking, exactly that same question. Was there an insider?

HARRIS: Yes, OK. And the Congress is still holding hearings and investigating this, and so there is so much to learn on this?

BOUDREAU: It's really just the beginning. I mean, so much is going to come out in all of this. And we'll, of course, be reporting every step of the way.

HARRIS: All right, Abbie Boudreau from our investigative unit. We appreciate it. Thank you, Abbie.

BOUDREAU: Thank you.

HARRIS: We are one week, one day out from Inauguration Day. How about this? Live pictures now. Tickets for the swearing-in ceremony being handed out less than 30 minutes from now for members of the House and Senate. House members get about 200 tickets. Senators about 400.

And all members of Congress get about 240,000 tickets to hand out to constituents. And as you can imagine, the demand through the roof.

CNN's live inauguration coverage kicks off Monday morning, January 19th, at 5 a.m. Eastern time. Watch it on TV and online. Cnn.com and Facebook invite you to share this historic moment with friends and family. Watch it live on cnn.com. View comments and update.

Wow, this is new. Update your Facebook status all in one place. Be a part of history. Go to facebook@cnn.com now and RSVP.

The coldest front of the winter is sweeping the United States. Rob Marciano is tracking it for us in the Severe Weather Center. We'll check in with Rob in just a moment.

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HARRIS: How about these pictures, huh? The Dutch are skating through winter. Canals in the Netherlands have frozen over for the first time in, what, a dozen years or so. This video from a CNN iReporter. Pretty cool stuff, huh?

Well, look at that. The freezing on the canals have brought out an estimated 2 million skaters. Europe has been in the throes of a severe cold snap, but the weather we understand is starting to warm up this week. You can always check in with Rob on that.

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HARRIS: CNN iReporters already fanning out to cover next week's inauguration. Why don't we jump on the scooter here and take a trip to cnn.com's iReport desk -- and that's the food court there -- and check in with one of the guys helping to run things down there at our iReport operation, Tyson's corner. You know you love it, Tyson Wheatley. Tyson, good to see you.

TYSON WHEATLEY, PRODUCER, CNN.COM: Hey, Tony, happy Monday.

HARRIS: Happy Monday. I guess we were talking last week about this assignment were you were essentially issuing the clarion call to all of our iReporters in the area to send us some iReports of the inaugural preps, huh?

WHEATLEY: Yes, that's right. Washington officials expecting, what, about 2 million people to be...

HARRIS: Yes, that's what we hear.

WHEATLEY: ... flooding the city, basically. And so of course, early preparations already underway in D.C. And so, we're asking people to -- especially people living there -- to tell us what's going on.

And we've got a great iReport from a D.C. native. He's an iReport superstar. His name is David White, and he went down to the Capitol Building on Sunday where, of course, that's the site of the swearing-in ceremony, and he took some great video. And listen to what he had to say. Let's take a look.

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DAVID J. WHITE, IREPORTER (voice-over): The stage is set. And those are the 30,000 seats.

(END VIDEO CLIP)

WHEATLEY; OK, so Tony, we've got at least 30,000 seats in place there, but 240,000 tickets, of course. So I'm not sure how many people are going to be standing, but we know that some are going to be standing. We know that hundreds of thousands of people, at least we expect, are going to be lining the parade routes, likely crowding the National Mall. You know, David doesn't have a ticket, not for lack of trying, of course. But he only lives a few miles away from the Capitol. And his plan, of course, is to go out on foot during the big weekend and see what he can dig up for us.

You know, it's interesting, David tells us that his fellow Washingtonians are obviously -- have been bracing for this massive crowd. One interesting note: He says a lot of local churches there are actually planning on having viewing parties because, you know, a lot of people there probably don't want don't want to go outside and have to mix it up with these floods of people.

HARRIS: Well, I would imagine those are going to be popping up all over the place. Hey, Tyson, I know you had an opportunity to see the president's final news conference of the -- of his presidency.

WHEATLEY; Right.

HARRIS: And I know that's part of your assignment today to get some thoughts from the i-reporters on the president's legacy.

WHEATLEY: Yes. That's right. I mean, it's President Bush's last week in office, so it's the perfect time to sort of reflect on the last eight years, and that's what we're inviting people to do.

In fact, I'm going to get our David, our camera guy, to zoom in on the assignment today. You can go to ireport.com/desk, and you too can weigh in on President Bush's last eight years. You know, what do you think his legacy is going to be. Tell us the highlights and lowlights. Share your thoughts on President Bush's place in history and also tell us where you think he -- what he should be doing post- presidency. (CROSSTALK) Great discussion already underway.

HARRIS: Can't wait.

WHEATLEY: And --

HARRIS: All right, Tyson, appreciate it. Let us know what you've got on that, and we'll pop you up.

All right?

HARRIS: All right. Take care, Tony.

HARRIS: All right, Tyson.

You know, it is the second full week of 2009. Are you sticking with your resolutions? Personal finance editor Gerri Willis helps you reduce your debt in the next hour of the CNN NEWSROOM.

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HARRIS: Wow, that was a good year for Jamie Foxx. Well, Hollywood's award season kicked off last night with the Golden Globes. The event featured a good deal of heart felt emotion as well as a few surprises.

Kareen Wynter runs down the big winners.

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TOM CRUISE, ACTOR: The Golden Globe goes to "Slumdog Millionaire."

(APPLAUSE)

KAREEN WYNTER, CNN CORRESPONDENT (voice-over): "Slumdog Millionaire," about an orphan who goes on India's version of "Who wants to be a Millionaire," went four for four, winning best picture/drama, plus score, screen play and directing honors.

UNIDENTIFIED MALE: The Globes just give us a platform that presents the film to the world.

WYNTER: The night's other top honor, best picture, musical or comedy went to Woody Allens's "Vicky Cristina Barcelona." Comedy actoring honors went to Sally Hawkins for "Happy-go-lucky" and to "In Bruge" leading man Colin Farrell.

COLIN FARRELL, BEST ACTOR, COMEDY: Nicer to be told well done than get a smack in the back of the head. Sometimes a smack is needed, but a well done is always lovely.

WYNTER: Hollywood loves a come-back story and they don't come much better than this. Mickey Rourke winning best actor, drama, for "The Wrestler."

MICKEY ROURKE, BEST ACTOR, DRAMA: I appreciate it a lot. It's a profession where you know, if you work hard enough and many years go by, you can get a second chance.

WYNTER: Kate Winslet ended Golden Globe drought in dramatic fashion by winning two awards. Supporting actress for the Holocaust film "The Reader," and best actress, drama for "Revolutionary road," which re-teamed her with her titanic friend, Leonardo Dicaprio.

KATE WINSLET, BEST ACTRESS, DRAMA: Leo, I'm so happy I can stand here and tell you how much I love you and how much I've loved you for 13 years.

WYNTER: And perhaps the night's most poignant moment came when the late Heath Ledger won for his memorable portrayal of the Joker in "The Dark Knight."

UNIDENTIFIED MALE: He will be eternally missed but he will never be forgotten.

WYNTER: Kareen Wynter, CNN, Hollywood.

(END VIDEOTAPE)

HARRIS: Sorry, we were still talking about Leonardo and -- all right.

OK. Change, it is sending Barack Obama to the White House, but will seeing the slogan make you spend that -- your hard-earned money? Next hour right here in the CNN NEWSROOM.

Wow.

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