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American Morning
Language Heats Up Between North and South Korea; Clinton Warns North Korea; Global Markets Sink; New York Post Issues an Apology for Offensive Cartoon; Wall Street Hit With More Woes; Congress is All A- Twitter; Benjamin Netanyahu Picked to Form New Government; Michelle Obama's Mission; "The Wrestler" Actor Busted
Aired February 20, 2009 - 06:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
(BEGIN VIDEO CLIP)
JOHN ROBERTS, CNN ANCHOR (voice-over): Breaking news. Hillary Clinton speaks to CNN, overnight from South Korea.
HILLARY CLINTON, SECRETARY OF STATE: All of a sudden these insults and these provocative statements start coming across the border.
ROBERTS: The critical effort to stop a war of words from becoming something a lot worse.
Plus, the bank backlash.
JOHN STEVENS, CNN IREPORTER: My mortgage company barreling full force can take me out of this house.
ROBERTS: A plan intended to help homeowners put some deeper under water.
STEVENS: Now I feel a little sigh of relief, until today.
ROBERTS: The best money team fields your urgent iReports on the Most News in the Morning.
(END VIDEO CLIP)
ROBERTS: And good morning. Thanks very much for being with us. It's Friday, it's the 20th of February, heading into a weekend here.
KIRAN CHETRY, CNN ANCHOR: That's right, and we begin with breaking news this morning. We're talking about Wall Street bonuses again under scrutiny.
Sources are telling CNN that New York's attorney general has subpoenaed Bank of America's CEO, Kenneth Lewis, pictured there, part of an investigation to determine whether the $3.6 billion in bonuses given to Merrill Lynch employees last year were secretly moved up to compensate top executives before Merrill was taken over by Bank of America. The state is also investigating whether the bank violated state law by withholding information from investors.
Well, the Pentagon may have lost thousands of extra machine guns, armored vehicles and other military equipment. That's according to an internal report from the Defense Department. One top official says that some of the military stash was given to unauthorized countries between October of 2001 and March of 2006, potentially jeopardizing national security. The report points to failures by the Navy and Air Force that found that the Army was not at fault.
And gas prices dropping again overnight. This is the fifth straight day of declines after we saw several days of increases. According to AAA, the national average is now $1.94 a gallon. That's down more than a penny overnight.
ROBERTS: Well turning now to breaking news, Secretary of State Hillary Clinton talking one on one with CNN today as the language heats up between North and South Korea. This morning South Korea is warning its neighbor to the north that it is ready to respond and attack Pyongyang's launch sites if its ships come under attack. The North already proclaiming that it is "fully ready for war." A lot of tension in the region and the nation's top diplomat telling CNN that right now the North is at a crucial crossroads.
(BEGIN VIDEO CLIP)
CLINTON: What is clear from the six-party process over the last years is that when North Korea decides to cooperate and make agreements, that it believes are in the furtherance of its own interests, it will do so. And when it doesn't, it is always seeking advantage and it uses, you know, provocative words and threatened actions to try to get attention in order to, you know, make a deal in some way -- you know, food and fuel, and other kinds of assets.
I mean South Korea basically, you know, keeps the North Korean economy going with all of the subsidies of food and fuel and medical supplies and the like. So I don't -- I think it's calculated, and I think you have to respond in-kind, as you look at the behavior of the day, the week, the month and the year.
Now, if North Korea is calculating that somehow they're going to drive a wedge between the United States and the Republic of Korea, they're badly miscalculating. Our alliance is, you know, stronger than ever and it's not only about our mutual security, but it's also about how we're going to deal with the global economy and so much else.
So I think that there's a testing period, and a kind of, you know, wait and see attitude about how this is going to move forward, and we're hoping that North Korea will see its way clear to reengage. And as I've said repeatedly, if we can get to the point where denuclearization is verifiable and complete, there are tremendous advantages waiting for North Korea, not only a bilateral, normal relationship with the United States, but I think a lot of international support and aid that could come to the people of North Korea.
(END VIDEO CLIP)
ROBERTS: Secretary of State Hillary Clinton talking with our Jill Dougherty overnight. Right now, the secretary is headed to Beijing. And let's tap into CNN's global resources and head there now live ahead of the secretary.
Our John Vause is in our Beijing bureau this morning. And, John, back to North Korea, the language getting hotter and hotter between North and South Korea. What's up with all of the saber rattling there? Are they just trying to get noticed?
JOHN VAUSE, CNN CORRESPONDENT: Yes, well, certainly they're trying to get notice with the new administration in Washington. North Korea wants some attention. This sort of break (ph) shift tactics and the threats it's certainly is not unusual for North Korea. We've seen these tactics before, trying to drive a wedge between the allies in the region. They tried it during the six-party process.
There was a time then when they refused to speak with the Japanese delegates because of some perceived diplomatic spout. Hillary Clinton making it clear that it would not work. Also at the same time extending that hand to North Korea saying it plays by the rules. If it gets back to negotiations, there will be rewards for the North.
The only problem with that line of diplomacy it just didn't work. For Condoleezza Rice when she was secretary of state, she tried in the last couple of years of the Bush administration and just hasn't worked. So this is the real problem for Hillary Clinton right now, John.
ROBERTS: You know the secretary of state, John, also talking about a potential crisis of secession there in North Korea. Still no certainty on Kim Jong-il's health and now word of a shakeup at the top ranks of the military?
VAUSE: We know something's going on inside North Korea. We know that in the last couple of days Kim Jong-il has sacked three senior military officials, replaced them with three hardliners who are loyal to him. We know that Kim Jong-il had a stroke last August and those who are coming out of North Korea have told me that the dear leader is still involved in key decisions but no longer involved in the day-to- day decision making.
We don't know how his health is. We've seen him last week, some still photographs inspecting some military units but we haven't seen any video. We haven't seen him moving.
One of the symptoms of that stroke was, in fact, said that he was suffering some kind of limp. So because we haven't seen him walking, we don't know if he is, in fact, still limping. We don't know if he is, in fact, walking at all so we don't know how severe that stroke was. We don't know how much he has managed to recover from that. But it is clear there is something going on within North Korea and Kim Jong-il is tightening his grip on the military, John.
ROBERTS: John Vause on the story for us this morning from Beijing. And again, Hillary Clinton will be heading to Beijing in just the next couple of hours. John, thanks so much.
CHETRY: There is breaking financial news this morning as well. Markets across the globe tanking overnight after the Dow closed yesterday at a six-year low. Japan's Nikkei tumbling ever closer to a 26-year low.
Well, stocks in Hong Kong are down more than two percents. And across Europe, traders also seeing red. London's FTSE falling below 4,000 points in early trading, lowest level in three months. Right now, we have Dow futures looking down by about 105 points.
Stephanie Elam is "Minding Your Business" this morning. So yesterday, we saw it close at 7465, numbers we haven't seen since 2002.
STEPHANIE ELAM, CNN BUSINESS CORRESPONDENT: Right, October 9th, 2002. Do you remember what you were doing then?
CHETRY: No.
ELAM: That's how far back it was.
CHETRY: I don't remember what I was doing yesterday.
ELAM: You were here. I was with you.
Yes, let's take a look at what's going on here. And the reason why we're seeing the overseas markets also tanking today is because of the fact that with all the plans that have come out from the Obama administration, people are still jittery about recession fears. There's fear that these plans will not be enough to help the global economy, which as we've seen started the housing crisis here in the United States and then it spread overseas from that. But now, other countries are in a recession as well and so this is the fear that is now going global.
Just to give you some idea here about what this means, form the record close for the Dow, it's now off 47 percent. That's how much we have fallen. The number then way back in those days 14,164. That was hit back in October. So if you look at these numbers and see, we're now back at the low of the last bear market and that's the reason why people are taking a look at it.
And also, just one last point. This is why we say don't try to find the bottom...
CHETRY: Right.
ELAM: ... because you think you'll hit it and it's like November, that's probably the bottom. Let's see if we start building and then you can fall again. So, the bottom is something you don't want to try to find and figure out and buy in and go for, because it's just too hard to figure out. It's one of those rear view mirror looking thing.
ROBERTS: I was just going to say this is not good for people's investments, 401(k)s...
ELAM: Not at all.
ROBERTS: ... other investments that people have. You know, what about folks who are facing retirement in the next four or five years?
ELAM: And that is the question for a lot of these people. It is changing when they can retire, and that's why so many people are concerned, you know. We always say to the younger people, you know, stay in it. It will be OK.
CHETRY: Right.
ELAM: It will be down by the time, but it is different and that's also part of the reason why when you do invest as you get older, you want to make it a safer bet, start finding less risky investments. For a lot of people, that's hard for them to do. They didn't start saving early enough, but that's one of the things you can do to help out. But it's a rough period, no doubt.
CHETRY: And there are analysts that say they don't see a turnaround for, you know, at least the first half of this year because there's no indication that there's any big catalyst for change on Wall Street right now.
ELAM: And it's also some people are saying this economy will shrink this year, so this whole year could be weaker. So that's another reason why you have to be concerned.
ROBERTS: You know, my 401(k) is back to where it was in 2002 but I'm still seven years older.
CHETRY: Yes.
ELAM: Right. Your age doesn't change.
CHETRY: Right. That's the problem.
ELAM: I know, it's rough.
CHETRY: I'm not even looking right now. Thanks, Stephanie.
Well, Stephanie stays with us this morning as the economy continues to grab headlines. We want to hear from all of you at home. Send us an e-mail or an iReport. Go to CNN.com/am, iReporter John Stevens in Torrington, Connecticut, sent us this video talking about the foreclosure on his home.
Let's listen.
(BEGIN VIDEO CLIP)
STEVENS: I've been unemployed going through a foreclosure. I don't have a lot of income coming in, which isn't enabling me to pay my mortgage and keep up with things. But besides that, I was so excited yesterday when President Barack Obama announced his foreclosure fix, the housing fix, and it kind of took a weight off my shoulders.
Today I find out that since President Obama announced his housing fix program that Citi mortgage was my mortgage company is now barreling in full force to take me out of this house.
(END VIDEO CLIP)
ROBERTS: That's terrible.
ELAM: That is a terrible story. And there are so many stories like this, where people feel like they're being targeted. And so we did a little research just to see exactly what is Citi saying about this.
And so, February 13th of this year, that's just coming out here, they're saying that they have issued a moratorium on all initiating any new foreclosure proceedings or closing any of them. This is for Citi-owned mortgages and also first mortgage loans and it has to be the principal resident of the borrower.
Now the reason why I say that is perhaps this mortgage was sold. You need to check and see who does own this. If not, then I say you go back and fight this one because they have said, this coming down from the chief executive that they will not issue any new foreclosures and they will not continue to, you know, finish anyone that they've started before. So that goes against what they're saying but definitely you probably need more details here on this one, but I would say they'll look into it and see if he can do anything to fight this.
CHETRY: All right.
ROBERTS: All right. Stephanie, thanks so much for that.
ELAM: Sure.
ROBERTS: Well across the globe this morning, nothing but red arrows as Washington spends hundreds of billions of dollars on a stimulus to prop up our economy. So why do stocks keep going south and what will it mean for your bottom line? We've got Chrystia Freeland and Jeffrey Sachs on tap today.
And the "New York Post" this morning saying that it's sorry for a cartoon that set off a firestorm. Find out why some are saying it's a sorry excuse for an apology.
It's 11 minutes now after the hour.
(COMMERCIAL BREAK)
ROBERTS: Thirteen minutes now after the hour and time to fast forward to stories that you'll see on CNN and CNN.com today.
This morning at the White House, President Obama meets with dozens of mayors from across the country. They're expected to discuss the best way to implement the $787 billion economic stimulus package. Vice President Joe Biden and other key members of the Obama administration also expected to attend that meeting.
First Lady Michelle Obama making the rounds today in D.C. She visits the Department of Transportation to thank workers there for their service. And coming up, we're going to take a look at the first lady's growing role as the president's eyes and ears in Washington.
And hundreds of investors who lost money in Bernard Madoff's alleged $50 billion Ponzi scheme will pack a federal bankruptcy court in New York today. They're hoping to find out when they can recoup some of their lost fortune. Right now, Bernard Madoff remains under house arrest in his Park Avenue apartment.
And that's what's going to be making later on today -- Kiran.
CHETRY: Thanks, John.
Well, this morning, an apology of sorts from the "New York Post" over a cartoon that sparked a lot of outrage. The paper claims that the cartoon was just a parody of Washington politics that played off the well-publicized chimpanzee attack. Others see it a clear racist portrayal of President Obama and for that the paper says it's sorry. So why are some not taking the apology seriously?
CNN's Jason Carroll is following this for us this morning. Hey, Jason.
JASON CARROLL, CNN CORRESPONDENT: Hello to you.
The Reverend Al Sharpton, for one, saying the apology seems somewhat insincere. "The Post" maintains that the cartoon is simply just that, a cartoon, and the paper's critics are merely using this as an opportunity for partisan payback. Even so, "The Post" did issue an apology.
It says, "It was meant to mock an ineptly written federal stimulus bill but it has been taken as something else, as a depiction of President Obama as a thinly veiled expression of racism. This most certainly was not its intent. To those who were offended by the image, we apologize."
The image offended a number of people. The cartoon showed a police shooting a chimpanzee with the caption "They'll have to find someone else to write the next stimulus bill." The drawing was a reference to a real life incident in Connecticut where police shot and killed a monkey who attacked a woman.
Protesters picketed in front of the tabloid's office yesterday, not satisfied with "The Post" original explanation about the cartoon. The paper initially said the cartoon "broadly mocked Washington" and it was not directed at President Obama.
Reverend Al Sharpton, among many who just simply did not buy that.
(BEGIN VIDEO CLIP)
REV. AL SHARPTON, CIVIL RIGHTS ACTIVIST: This is a very serious affront. This is race-based. This is offensive. To act as though the president of the United States, who is synonymous and personifies that bill, is the equivalent of a shot chimpanzee or monkey, speaks to all of the racial stereotypes and offenses that we've had to deal with this time.
(END VIDEO CLIP)
CARROLL: Grammy award-winning musician John Legend echoed Sharpton's comments calling the cartoon reprehensible. Legend is boycotting the paper and in an open letter to the paper is asking his colleagues in the entertainment business to do the same saying, "We do not need the "New York Post" to resurrect the images of Jim Crow to deride the new administration and put black folks in our place. Please feel free to criticize and honestly evaluate our new president, but do so without the incendiary images and rhetoric."
It's unclear if "The Post" apology will be enough to satisfy critics, many of whom are calling for the cartoonist, Sean Delonas, to be fired.
CHETRY: (INAUDIBLE) so-called the controversy surrounding it yesterday absolutely ridiculous, right?
CARROLL: Yes, he did. Yes, he did. But you know, like, you know, you can see both sides.
CHETRY: Yes.
CARROLL: It's an issue of free speech but then, you can also see how given, you know, the history of this country with racist imagery how a lot of people would be offended.
CHETRY: Jason Carroll, thanks so much.
ROBERTS: "Absolutely frigin' ridiculous" was I think the actual quote.
CHETRY: Yes, it was.
ROBERTS: The government is planning to spend hundreds of billions of dollars to prop up the economy and the troubling housing market. So why is that leading to more red arrows on Wall Street? We're asking a pair of experts this morning.
And back in the saddle again. Aerosmith wants to buck Republicans in Congress off their party pony. We'll take a look at this and some other stories making news in Washington.
Seventeen and a half minutes now after the hour.
(COMMERCIAL BREAK)
ANNOUNCER: This is CNN breaking news. ROBERTS: And we're turning to our breaking news this morning. Markets hemorrhaging big losses. The Dow closing at a six-year low yesterday, likely taking some of your retirement income along with it. And right now, that's sending markets south across the globe. So how will those markets and your 401(k) go? And is there any end in sight to the worldwide economic fund?
We're joined this morning by Chrystia Freeland, the U.S. managing editor of the "Financial Times" plus international economist and director of the Earth Institute at Columbia University, Jeffrey Sachs.
Good to see both of you this morning.
So what's going on with the markets here? They're back to where they were in 2002.
CHRYSTIA FREELAND, U.S. MANAGING EDITOR, "FINANCIAL TIMES": I think that this week the thing which is really hitting the markets especially the Dow yesterday is concerns about the banks. And I think this has been mounting since we had the very poorly-received Geithner plan.
What we're seeing is people becoming increasingly concerned that there will be some sort of nationalization of the banks. And interestingly, it was Citi and Bank of America, the two banks that are perceived to be the weakest which fell strongly yesterday, 14 percent.
ROBERTS: Yes. You know, not long ago Bank of America stock was at about $42.50. It's down around $4 now, Jeff. How low can we expect to see this market go? I mean, are we headed then to the sixes?
JEFFREY SACHS, DIRECTOR, EARTH INSTITUTE AT COLUMBIA UNIV.: Well, it's impossible to predict right now except what's clear is that the world hasn't bought in yet to any scenario of recovery, and we don't yet have on a worldwide basis a story or a vision that people say that's how we're getting out of this. And that's a big problem.
We're going to have to turn more as we've been discussing over the last few months more to a full international perspective that this is a worldwide crisis. It requires worldwide cooperation and coordination. We've been focusing only on the U.S. problem right now. There's an important meeting coming up in early April, the so-called G-20 meeting in London. This is going to take on more and more importance.
ROBERTS: And in the meantime, Chrystia, because your publication is a global publication, is the worldwide recession, the economic slowdown beginning to accelerate? I know it's kind of a contradiction in terms of slowdown accelerating with this.
FREELAND: Yes, I think it is. And I agree with Jeff that it is going to take global solutions. But what seems to be happening particularly in recent weeks is the U.S. pulling the rest of the world down. ROBERTS: So what about this idea of nationalizing the banks? Your former colleague, Nouriel Roubini (ph), who some people like to call Dr. Doom.
FREELAND: He likes it, too.
ROBERTS: He likes the title, says, yes, national of banks, it's inevitable.
SACHS: Whether it's inevitable or not, we don't yet have a plan from the administration. You know, one of the things that's happened as Chrystia said is that when Secretary Geithner came out last week, everyone said where are the details, what's the information? He said, well, that's coming over the next few weeks. That made people pretty scared, unfortunately, because they had a big announcement and the announcement was we don't know yet. So, whether the banks, the big banks have to be nationalized in the end isn't absolutely clear. I think they need a strategy, which has been --
ROBERTS: Well, if you were to be -- if you were to be a betting man, what would you say?
SACHS: I think that there are ways to work through this that will probably have most of the banks survive but some of the banks in the end probably can't survive.
ROBERTS: And then, of course, all of this feeds into everything else, every little aspect of this. And it's just this big snowball that keeps rolling down the hill. The housing rescue bill that the president announced earlier this year, do you have any faith that that's going to work?
FREELAND: No faith, but I think on the housing specifically, that's definitely better than nothing. I would really say I think at this particular moment especially in the U.S., the banks are at the center of everything. And while I think that Jeff is absolutely right that we have to differentiate between the banks, and some are stronger than others, the problem right now is the mechanism whereby that differentiation happens is very unclear. And as long as that's the case, everyone is going to be hammered. The only exception yesterday was Goldman Sachs, but that's just one exception.
ROBERTS: And, Jeff, what about this plan that the treasury secretary is floating to provide $1 billion worth of money to private equity firms, to hedge funds to buy up some of these loan and mortgage-backed securities to try to get the credit markets flowing again? Do you think that's something the private enterprise can buy into?
SACHS: It raises a lot of questions. Partly we have --
ROBERTS: You're killing me here. You're both killing me here.
SACHS: Here's the problem. We had a bubble of consumption of housing spending and it collapsed. Now, what they seem to be saying is, let's get that going again. We'll start trying to lend money back into housing, back into the consumer spending, but people are saying but that collapsed. Should we be trying to recreate the bubble? And that's where I feel we don't yet really have the scenario.
We don't want to come out of this by putting back together what wasn't sustainable to begin with. We need to find new ways for investing and saving, and I think people would feel a little bit more comfortable if they saw the longer term path out of this.
ROBERTS: Everyone is Dr. Doom this morning.
SACHS: There are ways out of it. It's not the end of the world, but we haven't yet heard the full story.
ROBERTS: All right. Jeffrey, Chrystia, good to see you. Thanks for coming in this morning -- Kiran.
CHETRY: All right. Well, the financier accused of bilking investors out of $9 billion turns himself in and new details are now emerging, his millions of dollars in donations to some of Washington's biggest players.
Also from Sarah Palin's tax matters to the politician hitting a sour note with Aerosmith. We're taking a look at the stories buzzing throughout Washington that you may not have heard about this week.
It's 25 minutes after the hour.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP, "LATE NIGHT WITH CONAN O'BRIEN")
CONAN O'BRIEN, HOST, "LATE NIGHT WITH CONAN O'BRIEN": Is it true that you don't use -- you don't use a BlackBerry?
JERRY SEINFELD, COMEDIAN: No. Oh, no. I find the BlackBerry people, their eyes, their pupils don't focus. They seem to be -- they always hold it in their hand, because this is what BlackBerry commands them to do.
And they listen to what you're saying, and they compare it to what is on the BlackBerry, which is really more interesting here to me. Don't they do that? And you know what? I think there's more buttons here than on your face.
(END VIDEO CLIP)
ROBERTS: Welcome back to the Most News in the Morning.
Conan O'Brien bringing out the big guns with Jerry Seinfeld during his last week as host of "Late Night." Conan's final show airs tonight. He's then going to move to Los Angeles where he'll take over as host of "The Tonight Show" in the first of June. O'Brien replaced David Letterman as the host of "Late Night" back in 1993.
Right now, it's about 29 minutes after the hour and here's a check of the top stories. Secretary of State Hillary Clinton is on her way to China. It's the final stop of her first overseas trip. The stakes are very high for her. Tension is heating up between the U.S. and China during the current global financial turmoil. But China blaming the U.S. for its economic trouble and calling President Obama's stimulus package a "poison to the solution."
It's the first appraisal of Iran's nuclear program since President Obama was sworn in. Atomic inspectors say Iran has low- bawled the amount of enriched uranium that it has by about a third. U.N. officials told the New York Times for the first time Tehran has now announced more than a ton, and that is enough nuclear material to eventually make an atomic bomb.
And the manhunt for the billionaire dealmaker accused of cheating clients out of $9 billion. It's over this morning. Yesterday, the FBI served Robert Allen Stanford with a subpoena in Virginia and he surrendered his passport. We're also learning that last year, Stanford gave money to both President Obama and Senator John McCain. Both have now given that money to charity. Stanford's father says he is stunned by the allegations against his son.
CHETRY: Well, governor of Alaska, Sarah Palin, agreeing to pay back taxes on nearly $17,000 that was paid to her for travel reimbursements. This is when she spent nights in her Wasilla residence. According to state legal opinion, these payments were not legitimate business expenses they ruled this week. So now she owes the IRS for meals and other expenses.
So now with a look at this story as well as other stories from inside the beltway that you might not have heard out this week, we turn to CNN contributor and "Washington Post" columnist Dana Milbank.
Dana, good to see you this morning.
DANA MILBANK, CNN CONTRIBUTOR: Good morning, Kiran.
CHETRY: Now this is interesting because this was an issue that came up during the campaign, and she said at the time this is just a per diem that I'm allowed to take? But was she wrong, or did they change the law on her?
MILBANK: Well, she's allowed to take it, but she also had to pay taxes on it. It's a bit of a quirk of Alaska law there, because technically her office is up in Juneau, when she is in Wasilla, she was technically on the road. But it sounded a little fishy, so "The Washington Post" actually originally looked into it and now the state is saying, well, she's got to pay back the money on that. But I think this sets her up just perfectly for a job in the Obama cabinet right now, and that everybody needs to have a back tax problem.
CHETRY: In fact, I thought that you would enjoy this. Let's put up another "New York Post" cartoon, not the one that's raised all the raucous, but a different one about Sarah Palin. Can we show that one real quick? There you see it. It's Sarah Palin in the tax office, and it says "you need to pay your back taxes. Who do you think you are, a Democrat?"
MILBANK: It seems to be a bipartisan issue this year. But I'm telling you, health and human services still open, commerce department. She'll be just fine. It's only 17 grand and, you know, the book contract is going to be a lot more than that.
CHETRY: You know, this is another funny situation that happens a lot. You think a song is your theme song, it either captures your campaign or captures the message you're trying to bring along politically. However, the band doesn't always agree, and in this case we're talking about Aerosmith "Back in the Saddle."
And apparently that video was -- I mean, that song was used in a YouTube video to celebrate House Republicans' unanimously voting no on the economic stimulus bill. Well, it seems as though Steve Tyler and the bunch are not too thrilled.
MILBANK: No. They've -- the House Republicans have had some problem with this sort of thing before. Last year, they decided that their election year theme would be "The Change You Deserve" until they found out that was actually the slogan of the antidepressant drug Effexor. Now Eric Cantor, the number two House Republican, has gone with back in the saddle. Even though the lead guitarist was a McCain guy, they said no good. You're going to have to take this down, which they did. But it could be worst. They could have -- instead of "Back in the Saddle," they could have gone with Aerosmith's "Get a Grip." I think that would have been even worse.
CHETRY: Or "Love in an Elevator" wouldn't have been too great, either. But, you know, Richard Pearl, by the way -- of course, he was held up as this Neo conservative. One of the biggest advocates for going to war in Iraq and an adviser, of course, to the Pentagon and the run up to the Iraq war is doing some major back pedaling this week. It's very interesting what he's saying about his foreign policy views now. Tell us about them and why the change of heart.
MILBANK: Well, I was at a session with him just yesterday in Washington, where he said he really doesn't think there's any such thing as a neoconservative, and he's certainly not a neoconservative, and even if neoconservatives did exist, they certainly had nothing to do with all those bad things that happened over recent years. So there is definitely sort of an Alice in Wonderland feeling that everything had changed, and sort of down is up and in is out there. But, you know, there have been some damaging times for the neoconservatives these past eight years and I can understand why they might want to change their position on things. I'm going to try to argue next week that I am in fact not a journalist.
CHETRY: So this notion of preemptive attack and also using military power to spread democracy, sort of the hallmark of the neocon thinking. He says that that's not the case?
MILBANK: Didn't happen. It was a figment of your imagination, Kiran.
CHETRY: All right. Dana Milbank for us. Always finding interesting tidbit to share with us. It's great to see you this week. Have a great weekend.
MILBANK: You, too.
CHETRY: Thanks. It's 34 minutes after the hour.
JOHN ROBERTS, CNN ANCHOR: How to know what your lawmaker is doing every second of the day.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: We now have a new public bulletin board.
(END VIDEO CLIP)
ROBERTS: The new craze on Capitol Hill.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: Just like this, immediately.
(END VIDEO CLIP)
ROBERTS: Why Congress is all a-twitter.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: What are you posting now?
UNIDENTIFIED FEMALE: Just did an interview with CNN. I'm tweeting.
(END VIDEO CLIP)
ROBERTS: Ahead on the "Most News in the Morning."
(BEGIN VIDEOTAPE)
TOM SZAKY, CEO, TERRACYCLE: How are the bird feeders coming?
UNIDENTIFIED FEMALE: Tom Szaky is turning garbage into gold.
SZAKY: From Caprisun juice pouches, we make into messenger bags and pencil cases, chip bags into homework folders, vinyl records into clocks, circuit boards into frames.
UNIDENTIFIED CNN CORRESPONDENT: In 2003, Szaky dropped out of Princeton University to focus on its company TerraCycle. His first product was fertilizer. But now, he can't take his eyes off the trash.
SZAKY: Just in 2008, we saved somewhere over 100 million units of waste.
UNIDENTIFIED CNN CORRESPONDENT: TerraCycle takes ordinary garbage like juice pouches, cookie wrappers and plastic bags and turns them into new products. Companies like Craft and Frito Lays send their garbage to Szaky instead of to the dump. Schools, churches and other groups also help. For each item they collect, TerraCycle donates two cents to the school or charity of their choice. While the weakened economy affects sales, Szaky isn't worried.
SZAKY: We keep costs low by having waste as our input.
UNIDENTIFIED CNN CORRESPONDENT: And this may change consumer habits.
SZAKY: When you buy a TerraCycle pencil cases, it does not going to cost more than a cotton pencil case. Green sometimes is just considered very elitist. You know, it's only for people who can afford it, who are trying to break that down and do it for everybody.
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RICK SANCHEZ, CNN CORRESPONDENT: Flip it around, Robin. Let's go to the Twitter board.
Let's go to the Twitter board.
Shoot our Twitter board.
Let's go to the Twitter board if we possibly can.
Twitter board.
Twitter board.
Twitter board.
Twitter board.
Twitter board if we possibly can.
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ROBERTS: Welcome back to the "Most News in the Morning." Twittering, it's not just for our Rick Sanchez anymore. Millions of people are using the microblogger on their laptops and cell phones to send updates called Tweets to online buddies. Business folks, doctors or local police, even lawmakers on Capitol Hill are doing it. Everybody is all a-Twitter these days.
Kate Bolduan is live in Washington for us this morning.
What's the fascination, Kate?
And I asked that or saying that I have actually signed up for a Twitter account. I have yet to send my first tweet, though.
KATE BOLDUAN, CNN NATIONAL CORRESPONDENT: It's a big first step. You have to -- you have to let me know so I can start following you when I Twitter.
John, a tweet as limited as you are now learning to just 140 characters. And we all know brevity can be a challenge here in Washington, but it is taking off.
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BOLDUAN: Twitter, the social networking craze, has made its way to Capitol Hill in a big way.
SEN. CLAIRE MCCASKILL (D), MISSOURI: The way I think of it is we now have a new public bulletin board.
REP. JOHN CULBERSON (R), TEXAS: And it goes to my 6,400 followers who can then send it to their 100 or 1,000 or 2,000 followers, who send it to their hundred or thousand followers and it's geometric, just like this, immediately.
BOLDUAN: Missouri Democrat Senator Claire McCaskill and Texas Republican Congressman John Culberson are two of an estimated 71 members of Congress twittering. They have two of the largest Twitter followings, posting in committee, from the House floor...
UNIDENTIFIED MALE: Mr. Chairman --
BOLDUAN: And on the way to preside over the Senate. Even twittering during our interview.
What are you posting now?
MCCASKILL: Just did an interview with CNN on tweeting.
CULBERSON: First time in our history, we are empowered as free people through the Internet to see and hear and participate in our government.
BOLDUAN: Senator McCaskill updates her more than 4,000 followers on everything from the economic stimulus to her laundry, often spontaneous tweets, she says, not an easy task in a message-managed life of an elected official. So we asked, could all of that twittering be viewed as playing instead of working?
MCCASKILL: I don't think anybody in this area expects me to be reading legislation 24 hours a day. I think they expect me to be honest, and authentic and candid and truthful, and I'm trying to do that in a measured way that reflects what my day is really like.
BOLDUAN (on camera): The whole Claire McCaskill.
MCCASKILL: The whole Claire McCaskill, not just the official side.
BOLDUAN: And that's exactly what the sunlight foundation advocating greater transparency through technology hopes for.
CONOR KENNY, SENIOR EDITOR, SUNLIGHT FOUNDATION: It's a way of really opening up the mystery in the black box that is Congress to constituents back home, and really as well as revealing the human side of members of Congress.
(END VIDEOTAPE)
BOLDUAN: Now, twittering isn't always well-received. Congressman Pete Hopes for the top Republican on the House Intelligence Committee twittered his whereabouts while traveling through Iraq. Those posts have now prompted the Pentagon to review its policy of releasing travel itineraries as they say they're looking into their instructions to include new communication technologies. So be careful, John.
ROBERTS: Yes. There have to be some limits on twittering. You know, when I was a White House correspondent some years back, I remember when all of the administration officials went into the situation room, they had to leave all of their communications outside of that room, couldn't take it in. So --
BOLDUAN: Looks like everyone is taking everything everywhere right now.
ROBERTS: So the human side of Congress. Who knew there was one?
BOLDUAN: I know. I was a little surprised with that one.
ROBERTS: Kate, thanks so much. Great piece.
So what do you think about this Twitter thing?
CHETRY: Like I said, I can't believe you're going over to the dark side, John. You signed up for an account.
ROBERTS: I signed up for it. I'm following a few people. Lance Armstrong is the reason why I signed up. Also following Karl Rove to see what he has to say. But it's like you get this -- you know, if it's a member of Congress or something like Lance who was involved in like a race or something like that, you're following their progress, but somehow I got logged on to some other people's tweets and they're like, well, I'm thinking about, you know, feeding the baby here and maybe, you know, watching "Lost" and sitting down, and have a beer, and then, why do I need to know that?
CHETRY: Right. (INAUDIBLE)
ROBERTS: Yes, exactly.
CHETRY: The other thing, too, people want to go to Twitter, how do they know they're talking to you and not the Supreme Court justice?
ROBERTS: Because mine says CNN.
CHETRY: Very well. We have some breaking news we're following this morning as well out of Israel. Hard line leader Benjamin Netanyahu was picked to form a new government there. So we're working on details right now, and we're going to have more on that after the break.
Also, Michelle Obama getting to know her new home, Washington. We're going to take a look at what some are saying as her new role in the White House. It's 43 minutes after the hour.
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CHETRY: Wow, pretty picture this morning coming to us from WFTV. That's a live look at Orlando this morning. Thanks to our friends there. It's 50 degrees right now, going up to 64. It will be partly cloudy today as well. 26 minutes after the hour. And our Rob Marciano is live at the weather center in Atlanta.
That would be a nice place to be today, Rob.
(WEATHER REPORT)
CHETRY: Yes, it does sound very nice, given the frigid temperatures and all the wind we've been dealing with up here. All right. Thanks, Rob.
ROB MARCIANO, AMS METEOROLOGIST: You got it. See you later.
ROBERTS: This just in to CNN. Big news coming to us from Israel this morning after a couple of weeks of back and forth after the narrow Israeli elections. It appears as though we do have somebody who is potentially going to be the next Israeli prime minister. And here's the way that it shakes down.
Shimon Peres, the Israeli president, has asked Benjamin Netanyahu to try to form a government. He's got six weeks to do it, and if he does, if he manage this to put together a coalition that King govern, he will become the next Israeli prime minister.
Now, Tzipi Livni's Kadima Party had actually won one more seat than Netanyahu's Likud Party in the Israeli elections. But Shimon Perez believes that Netanyahu is in a better place -- better position to put together a coalition government. So he's asked him to form the next Israeli government. He said he's got six weeks to do it. Not clear at this point if he's going to form a right wing coalition or if he'll try to form a center-right coalition or a broader coalition by involving the Kadima Party in it.
Tzipi Livni has said so far that she has no interest in forming the coalition with Netanyahu. So, we'll see. Six weeks to do it if he does, Benjamin Netanyahu becomes the next Israeli prime minister.
This morning, Michelle Obama quickly becoming the smiling face of the White House as she continues her tour of government agencies. In just a moment, we'll take a look at the First Lady's mission these days.
And some have called it Obama's Vietnam. Now word from the commander in Afghanistan that a surge in troops could last another five years. We'll ask an expert on the region whether the U.S. can succeed there when every other nation that's tried has failed. It's coming up now on 50 minutes after the hour.
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MICHELLE OBAMA, SEN. BARACK OBAMA'S WIFE: As you probably heard, I've been running around the district, visiting departments, and as I said, it's been one of the most fun things that I've done. My purpose is simple. It's to say thank you.
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ROBERTS: Today, the meet and greet tour continues for the First Lady. In just a few hours, Mrs. Obama visits the Department of Transportation. The latest in a series of stops across Washington as she said. The goal, part introduction, part saleswoman. Here's CNN's Erica Hill with that.
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UNIDENTIFIED MALE: Michelle Obama.
ERICA HILL, CNN CORRESPONDENT (voice-over): The first lady didn't arrive at the Agriculture Department empty handed. Rallying behind Secretary Tom Vilsack's plans for community gardens at the USDA, Mrs. Obama brought her own addition.
M. OBAMA: I brought a little gift to get this garden going. It's right here in this pot. It is a seedling. It will be beautiful one day.
HILL: Especially if it grows like the magnolia tree it came from, planted on the White House lawn 180 years ago by President Andrew Jackson.
But there is more to this seedling than history. It's tough to ignore the symbolism of this gift. The relationship the Obamas hope to cultivate with the first lady's "get to know you" tour of government agencies.
M. OBAMA: It is an honor for me to serve in this capacity. And coming to these departments like I've been doing is probably one of the -- next to hanging out with Malia and Sasha -- is probably one of the most valuable things that I think that I can do.
HILL: It is also essential to her husband's administration.
LARRY SABATO, UNIVERSITY OF VIRGINIA: The president's been focused almost entirely on the economic stimulus package and probably privately on Afghanistan and Iraq. So she's making the connections to agencies that don't always get much attention.
HILL: Her message is consistent and clear. Thank you, and we need you.
M. OBAMA: It's going to take quite a long time to get this country back on track. So your contributions are more important now than they have ever been.
HILL: At each event, the first lady is also doing reconnaissance. With each handshake and hug comes a story of how real Americans are dealing with the downturn: their hopes, their fears, their dreams. Information the president needs.
SABATO: There is no more influential adviser than Michelle Obama. The trick is to be that influential adviser in private rather than in public. And in public, using those occasions to reinforce the president's agenda.
HILL: While Mrs. Obama's office tells CNN she is not visiting these agencies as a political surrogate for the president, the first lady is staying on message at each stop.
M. OBAMA: And the president's plan to address the home mortgage crisis is going to help rural families refinance their mortgages.
HILL: The White House hopes the first lady's plan will continue to help the president.
Erica Hill, CNN, New York.
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ROBERTS: Urgent diplomacy, tensions heat up between North and South Korea overnight, and Secretary of State Hillary Clinton responds first on AMERICAN MORNING.
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HILLARY CLINTON, U.S. SECRETARY OF STATE: All of the sudden these insults and these provocative statements start coming across the border.
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ROBERTS: Plus, final seconds of a doomed flight. Shaking, stalling, the buffalo crash, inside a cockpit simulator for answers.
(BEGIN VIDEO CLIP)
UNIDENTIFIED MALE: This is happening very quickly.
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ROBERTS: You're watching the "Most News in the Morning."
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