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Dodd Not Running Again; Security System Failure; Flight 253 Fallout

Aired January 06, 2010 - 10:00   ET

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

HEIDI COLLINS, CNN ANCHOR: New developments this morning on Capitol Hill: Democrats are losing a couple of their veteran leaders. Sources tell CNN Connecticut's Chris Dodd will announce in just a couple of hours he is not running for re-election this year. This bombshell follows a similar decision by North Dakota's Byron Dorgan. Together they served nearly 50 years in the senate. They also account for two very important votes in the Democrats majority.

The departures leave a void for Democrats heading into critical midterm elections.

Senior Congressional correspondent, Dana Bash, live from Washington this morning.

Dana, let's start with Senator Dodd in all of this. A high profile Democrat who seemed pretty determined to stay right where he was. What happened?

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT: Well, look, the bottom line is, Heidi, he is very low in the polls in his home state of Connecticut and he is up for re-election this year. Democratic sources have told us for some time there's been deep concern he would lose that seat this coming November. In fact, Heidi, I just got off the phone with a senior Democratic source involved with Dodd's campaign who told me that internal data showed it was virtually, quote, "unwinnable for him."

And I'm told Democrats have been carefully, very carefully and quietly suggesting that he may want to retire for a while because they have another good candidate who can run and that is Richard Blumenthal. He is the state's attorney general. In fact, he has already announcing just about two hours after Dodd formally says he's going to retire, Richard Blumenthal is going to throw his hat into the ring. That just gives you a sense that Democrats really were ready for this in terms of their ability to keep this seat in their column.

COLLINS: Yes. Boy, don't let the door hit you on the way out, huh?

But he was in - Dodd was in quite a bit of trouble back in his home state. Some constituents, quite a few of them actually not very happy.

BASH: That's right. Look, he has represented the state of Connecticut for three decades and he has been pretty popular. But starting a couple of years ago in 2008 when he had a long-shot bid for president, he moved his whole family out to Iowa to do that. And people in Connecticut, they weren't that happy about that and then things snowballed for him when the financial system collapsed.

He is chairman of the Senate banking committee. He was seen as absent or maybe even too close to Wall Street. And recently you remember Democrats tried to boost his standing, you've seen it recently with him very much out there on health care. He took over for his good friend Ted Kennedy when he got sick but none of that seemed to resurrect him with voters back home.

COLLINS: Yes. And let's get to Dorgan now. His announcement was maybe more of a surprise.

BASH: Yes.

COLLINS: So with two veterans not running obviously this means the power, if you will, for the Senate, the majority is in jeopardy.

BASH: That's right. When it comes to the balance of power in the Senate, Dodd's retirement in Connecticut, that could ultimately mean his seat is safer for Democrats if they do end up winning there with another candidate. But I talked to democratic strategists this morning. They are very worried about Byron Dorgan's surprise announcement because they think that does put North Dakota in jeopardy because it's a red state and there's actually a popular Republican governor who may jump into that race.

So we've learned, Heidi, from health care reform, which passed the Senate by exactly 60 votes, that the president's agenda, at least on highly partisan Democratic legislation like health care, it depends on having that 60-vote majority that they have right now. So that's an issue. Beyond that, these two Democratic retirements in the Senate and one in Colorado we expect, we've heard that the governor is going to hang it up as well.

COLLINS: Yes. Bill Ritter.

BASH: Exactly. Bill Ritter. That is an indication that Democrats know that this year, 2010, is a very tough political environment for them.

COLLINS: It could have been fascinating. A lot of work ahead, though, for you and me, obviously.

Dana Bash, thank you.

BASH: Thank you.

COLLINS: Now, just to recap a moment here, that leaves 11 senators who are not defending their seats this year. Five Democrats, six Republicans. So after Dodd and Dorgan, the Dems lose Paul Kirk, who replaced the late Senator Ted Kennedy. Also Roland Burris who replaced President Obama and Ted Kauffman who replaced vice president Biden. Then to the GOP, Kit Bond, Sam Brownback, George Voinovich and Judd Gregg, also Jim Bunning are all retiring. In Florida, George LeMieux replaced Mel Martinez who retired last year but he is not going to defend the seat.

Called on the carpet. The intelligence community faces presidential wrath over the failed bombing of Northwest flight 253.

(BEGIN VIDEO CLIP)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: A suspected terrorist was able to board a plane with explosives on Christmas day. The system has failed in a potentially disastrous way. And it's my responsibility to find out why and to correct that failure so that we can prevent such attacks in the future.

(END VIDEO CLIP)

COLLINS: So 11 days after it happened in a private meeting, President Obama called the incident a screw-up that could have been disastrous. He says the U.S. intelligence community had uncovered numerous red flags before the attack, but failed to put the information together. President Obama said he ordered his national security team to complete preliminary reviews this week. He says that will allow suggested reforms to be implemented.

The intelligence failures of flight 253 raised a troubling question. Is the flying public much safer now than in the aftermath of the 9/11 attacks? We put that question to former Homeland Security chief Tom Ridge on CNN's "American Morning."

(BEGIN VIDEO CLIP)

TOM RIDGE, FMR. HOMELAND SECURITY SECRETARY: I think we've learned a lot. I mean, I think we're gathering more and more information. I think one of the challenges this administration has is not only to correct the system or the procedure or the process but also I do think it would be helpful if they change the language a little bit. I mean, the president has referred to an isolated extremist attack and on other occasions they talk about man-made incidents. This is an ongoing, sustained effort by Al Qaeda to recruit, to do us harm and to do others harm.

(END VIDEO CLIP)

COLLINS: In other comments, Ridge applauded President Obama's vow to expand terror watch lists so more suspicious passengers will face additional screening.

And one of the big changes, expanding that terror watch list. The State Department says it's lowering the threshold now for airline passengers to be considered a potential threat. That means it will be easier for suspicious people to be selected for that additional screening or possibly barred entirely from coming into the United States. Remember the weekend security breach at Newark, New Jersey Airport? Of course you do, cameras captured the resulting chaos but security cameras won't be able to help locate the man who triggered the whole thing. It turns out the security cameras were not running. I'm sorry, they were running but were not recording when this individual passed by the screening. It's the latest embarrassment for the TSA. Its investigators were left scrutinizing security tapes from Continental Airlines but had no luck in identifying the man.

President Obama set to step back into the health care debate today with work starting on a compromised bill. The president has promised a hands-on approach to that new bill. Democratic congressional leaders are coming to the White House later on today.

(BEGIN VIDEO CLIP)

REP. NANCY PELOSI (D), HOUSE SPEAKER: We think that we have the fairest approach in our bill. We always say when it comes to tax policy around here, it's like a mirror. Mirror, mirror, on the wall, who is the fairest of them all. The Senate thinks theirs is fairer, we think ours is. We'll see which mirror cracks, but we will proceed in a way that is fair to the American people.

(END VIDEO CLIP)

COLLINS: Democrats have decided to skip a formal conference on the compromised bill. Sources tell CNN the decision was made to derail Republican efforts to slow down the process. A formal conference would have involved appointments and resolutions.

Right now, I want to get this information out to you because our correspondent Nic Robertson is coming to us from Jordan right now with news on the suspected alleged bomber of flight 253, Abdulmutallab.

Nic, tell us what you are learning.

NIC ROBERTSON, CNN SENIOR INTERNATIONAL CORRESPONDENT (via telephone): Heidi, what I'd like to do if I may is bring you details relating to the attack on the base at Ft. Chapman in Afghanistan where a Jordanian was alleged to have detonated explosives and killed seven CIA operatives and one Jordanian officer. I have been talking with the man who was accused of the bombing, al-Balawi.

I've been talking with his brother and I've also talked briefly with his father. The family say, of course, they were shocked. But what they have said is quite stunning information. They say that at 7:00 in the morning after the bombing happened, the father was called by an Afghan speaking in broken Arabic from Afghanistan and said that your son is dead. He has died a hero in an operation to kill the CIA. We know that this is going to make problems for your family, that you will have to deal with it, but for us he's a hero.

Now, the brother told me this was out of character, he felt, with his brother. That he believed that his brother was under pressure. His brother had told the family when he left Jordan a year ago that he was going to go to Turkey to finish his medical studies, but after three months they discovered that he wasn't in Turkey and they had been worrying about his whereabouts. They didn't know where he was.

And this was the first information the family had had. I asked did he think that this was a member of Al Qaeda that was calling the family to say that this operation had been successful. He said he didn't know if it was Al Qaeda, but he imagined it was one of those type of groups. Heidi.

COLLINS: All right. Understood. Forgive me there, Nic, I thought we were talking about a different story. So we sure do appreciate your information. Again coming out of Jordan on that CIA attack. We'll continue to follow that story and develop some of this information coming into us, once again, from Nic Robertson in Jordan.

Well, it is freezing from the plains to the deep south. At least five deaths are now being blamed on the bitterly cold temperatures with shelters packed in some cities like Rogers, Arkansas, getting ready to open what they're calling warming centers.

Rob Marciano has been following all of this for us.

(WEATHER REPORT)

COLLINS: In fact, whenever it gets this cold in Florida we always worry about the citrus crop. That is a $9 billion business. Andrew Meadows is a director of communications for the Florida Citrus Mutual Association. He is joining us now from Tampa this morning.

Thanks for being here, Andrew.

In fact, we've learned a little bit about this. Our correspondent John Zarrella has told us that there's a magic temperature, it's 28 degrees. It's got to be that or below for something like four hours before farmers are seriously concerned and the crop could be damaged.

ANDREW MEADOWS, DIR. OF COMMUNICATIONS, FLORIDA CITRUS MUTUAL ASSOCIATION: Exactly. That's kind of our line of demarcation is 28 degrees for four hours. We did have some isolated pockets that hit that. We got some mid-20s readings, so there's going to be isolated pockets of damage, but overall we came through pretty well last night. Certainly not a catastrophic event. But as you mentioned, we're not out of the woods yet.

COLLINS: Yes. It certainly sounds like that. So of course the next question is always what can farmers do? I mean this isn't the first time that this has happened in Florida and I'm sure that they, you know, have come up with tactics here. It's surprising because a lot of people might not understand or believe that it could actually be ice that helps in a situation like this.

MEADOWS: Yes, we actually irrigate it. It's a little counterintuitive but if you were paying attention in high school physics -

COLLINS: Absolutely. Dr. Barber. MEADOWS: You'll recall that the formation of ice gives off heat and that heat protects the trees at 32 degrees. So you'll see a lot of images of ice around trees and sometimes people mistakenly think that's naturally occurring ice when in reality that's what the grower wants. The grower wants a nice encasement around that trunk and lower portion of the tree.

COLLINS: All right. Well, we certainly wish all of the farmers there the best of luck and hopefully those temperatures will come up just a bit for everywhere across the country, especially Florida. Thanks so much, Andrew Meadows, we appreciate it.

MEADOWS: Thank you.

COLLINS: Look the one thing that we kind of can't stop talking about in fact in the CNN NEWSROOM, it is so cold that..., what? We want you to finish the phrase for us, finish the sentence. Go ahead and post your comments at our blog, cnn.com/heidi. And we'll read some of those responses coming up a little later on in this hour.

Boom after bust. The markets moved higher in 2009, as you know, but what's the outlook now for this year and how bright is the jobs picture? That's the key. We'll break it all down for you in just a moment.

(COMMERCIAL BREAK)

COLLINS: It's a brand new year and your 401(k) is probably looking much better than it did one year ago, but plenty of risks to the economy of course remain and jobs have certainly yet to return. CNNMoney.com's Poppy Harlow has more on the outlook for 2010.

(BEGIN VIDEOTAPE)

POPPY HARLOW, CNNMONEY.COM (voice-over): Despite the worst recession in modern history, 2009 was a boom year for the stock market. But when it comes to the real economy, namely your home and your job, there's still a lot of uncertainty about 2010.

UNIDENTIFIED MALE: I think my greatest financial worry for next year is just keeping my head above water. Costs are going up, incomes are not. They're flat or going down, and I don't see any immediate relief in sight.

HARLOW: The 2009 recovery effort was marked by massive government aid. TARP, the government's bank bailout plan, stimulus spending and fed action to keep mortgage rates low. But as the government pulls back its unprecedented financial support, some economists worry about what may lie ahead.

LAKSHAMAN SCHUTHAN, MANAGING DIR., ECONOMIC CYCLE RESEARCH INST.: I think it's a little riskier for the markets in 2010. There will be a lot more angst simply because the government is pulling back. The problem is we lost a lot. So it's recovering doesn't mean recovered. It's going to take a few years.

HARLOW: And what about the state of your job?

GARY LOCKE, COMMERCE SECRETARY: The president is most concerned about the high unemployment rate. Until everyone who wants a job has a job, the president and the entire administration will not be satisfied.

HARLOW: And although unemployment appears to have stabilized somewhat, the harsh reality is that some jobs may be lost forever.

JEFFREY JOERRES, CEO, MANPOWER: The pond is drained and companies are looking and saying why did we have four people doing that or why were we doing that at all? And they were able to consolidate it and there is a whole lot more being done with less. And I think that will continue. People are going to be asked to do a lot more than they were before.

HARLOW: Simply put, if you're one of the millions of Americans searching for work, a willingness to do more could be key.

JOERRES: What companies are looking for in situations like that is intellectual curiosity, the ability to learn and the collaborative agile mindset. That whole OK, I get it, I'm going to do this work. This may not be part of my responsibility but I'm going to help out somebody else.

(END VIDEOTAPE)

COLLINS: CNNMoney.com's Poppy Harlow joining us now live with more on this. So Poppy, is this the new normal? Working harder than ever but really having no choice because there's nowhere else to go?

HARLOW: Exactly. Slackers listen up to this one. I mean folks are staying in their jobs where they're not happy. We just heard yesterday job satisfaction is at a record low. Only 45 percent of people are even satisfied with their jobs. The big question is are we going to see those eight million jobs that have been lost in the last two years really return to this economy.

So we're asking people on Twitter. I want to point you to the CNN Money twitter page. Are you working harder than you used to just to hang on to your job? Let us know what you think, we'll bring you the answers today but the truth, you've got to do one job plus a little bit more it seems to hang on to the job you've got in 2010. Heidi.

COLLINS: All right. No question about that. Poppy Harlow, thank you.

HARLOW: Yes.

COLLINS: I want to get a quick check now of our top stories that we're watching this morning. Four people are dead after their helicopter clipped power lines in the Sierra national forest in central California. Among the victims are three biologists with the California Department of Fish and Game. They were surveying herds of deer. The pilot also died in the crash. An Amtrak train with more than 200 passengers on board derailed in Arkansas early this morning. There are no reports of any injuries. The Texas Eagle derailed about 45 miles northeast of Little Rock. It was headed from Chicago to Los Angeles through San Antonio, Texas. Amtrak officials are now deciding how to get those passengers to their ultimate destinations.

Well, these are headaches you can set by your watch. So painful, some women compare them to childbirth. We tell you about some relief you can find.

(COMMERCIAL BREAK)

COLLINS: Cluster headaches. Well, they're not your run-of-the- mill headaches, but ones marked by excruciating pain near the eye or temple. CNN's senior medical correspondent Elizabeth Cohen is here now joining us to talk more about what triggers them and obviously the latest treatments, because this is the good news. So what brings a cluster headache on in the first place?

ELIZABETH COHEN, CNN SENIOR MEDICAL CORRESPONDENT: You know, they don't actually know what the cause is but when they look at what some triggers are, they look at people with cluster headaches and what they might have been doing just before they got them. They have come up with a list of things that seem to trigger these headaches.

For example, smoking. That's an easy one to stop doing. You shouldn't be smoking anyhow.

COLLINS: Yes.

COHEN: Alcohol consumption, high altitudes and an irregular sleep schedule. All of those things seem to trigger cluster headaches. But I do also want to add that you can get them without having done any of these things.

COLLINS: Yes.

COHEN: And I've never had one but I've heard they're excruciating. In fact, one doctor in the '30s, Heidi, he called them suicide headaches because he was worried that his patients would commit suicide because the pain was so bad.

COLLINS: Oh my gosh. It sounds a little bit like migraines, just in the - you always talk about the triggers and trying to figure out what causes them from one person to the next. But what's the latest now on treating cluster headaches?

COHEN: Now this is so interesting. There's a study in the "Journal of the American Medical Association" that came out recently that said, you know what, inhaling pure oxygen seems to help. Right when you feel that headache coming on, and a lot of people know when it's going to happen because cluster headaches tend to happen at the same time every day, inhale pure oxygen and it worked for most of the people who tried it.

COLLINS: So what do you mean, just take a - I don't know, do you have to get your own oxygen tank in order to do that?

COHEN: You have to go to your doctor. You have to go to your doctor and he or she will get you set up. You don't want to try this. There are places that you can buy what says -

COLLINS: Oxygen bars or whatever.

COHEN: You don't want to do that. You want to go to your doctor. There are some people who should not be doing this treatment and you want your doctor to sort of set you up with the way to do this.

COLLINS: All right, very good. Elizabeth Cohen, I know you'll continue to watch that one, thanks so much. Appreciate it.

Getting ready for round two of the big chill. We'll get in with our Rob Marciano in a minute to talk about how long these icy conditions are going to stick around.

(COMMERCIAL BREAK)

ANNOUNCER: Live in the CNN NEWSROOM, Heidi Collins.

COLLINS: Fallout from flight 253. President Obama unleashing on the U.S. intelligence community over the failed Christmas day attack. He ordered preliminary reviews from his national security team to be complete this week.

Meanwhile, the president says plans will move forward to close the prison in Guantanamo Bay, but for now no Yemeni detainees will be sent back to their country. The suspect on flight 253 was reportedly trained in Yemen.

And the government is widening the criteria for putting people on the no-fly list now or revoking their visas. The Christmas day attack while a failure showed a serious gaps in U.S. security. Just how open is America to attack, even with the new measures in place?

Stephen Flynn is a security expert and author of books like "The Edge of Disaster, A Critical Look at America's Vulnerabilities" and is joining now live from New York this morning. Thanks for being with us. It's a good question, just how vulnerable are we?

STEPHEN FLYNN, SECURITY EXPERT: Well, we are vulnerable in two ways. One is our society is pretty wide open still for a whole series of potential attacks that could be profoundly disruptive and could be quite destructive in terms of loss of life.

We're also very vulnerable to something I'm deeply worried about, by just how events have unfolded over the last two weeks which is to react or overreact to some extent to these terrorist incidents.

COLLINS: What do you mean by that?

FLYNN: Well, what I mean is that the military value for our adversaries to engage in terrorism on U.S. soil is to get a big bang for their buck. Most of that bang really comes from how we respond. If we basically pursue very destructive kinds of political things like we're doing now with a lot of the blame game I think is going on, but also imposing sort of quick fixes that often aren't very good fixes, very costly and disruptive kinds of security measures that are not well thought out, then we get ourselves in trouble.

This is a long-term effort. One of the concerns I've had for a long time is that we focus so much on the hunt-and-destroy portion of this, taking the battle to the enemy, that we haven't looked around and said "What are the things we can do right here at home to reduce some of our vulnerabilities and make us better prepared and more resilient as a society?" There's the ability to just withstand and bounce back and get on with life. Instead of being traumatized and sort of really incapacitated almost by fear.

COLLINS: Right. We talked a lot about those things pretty quickly after September 11, and we certainly saw, and I hate to use the word because it seems to diminish a serious coming together of this country, and I think there's been a lot of people who said, you know, if there's somebody who looks suspicious or somebody who's doing something that's not right on an airplane, you'll be hard pressed to see people who won't do something about it as we saw on Flight 253.

However, that's great to talk about and important, but if there's going to be so much money, federal dollars in specific spent on different agencies like the Homeland Security Department, like the NCTC, like -- I could go on and on.

FLYNN: Right.

COLLINS: What are we missing? What should have been done over the last several years since September 11 happened?

FLYNN: Well, one is very clear that we just have to accept, not a very pleasant message, which is that there are inherent limits to what our national security intelligence, law enforcement, border agents can do. These systems are always not perfect. We've seen a lot of imperfection, too many imperfections that need to be addressed.

But the missing piece I would argue that has been involved is the failure to get all of us, the "we the people" part, engaged. It turns out when these things happened, it's usually everyday people who get involved, whether they like it or not. In this case, the two pieces that were successful were, one, the father came forward and told us that his son had a serious problem that we should pay attention to, and we didn't. And the second piece, of course, is what happened aboard the flight itself, when passengers looked at this guy trying to create a bomb and blow himself up and take them with him. They stopped that from happening.

That's an important part. American people need to be informed and empowered, not treated like children saying, "We're going to protect you at all costs," because our government often can't deliver that.

Now that being said, there's no excuse for the mistakes that have been made that we see shown here. An element of it is that so much of the emphasis on how we've been dealing with the post 9/11 world is heavily on our military side of things. Looking for terrorists in places like Afghanistan and Iraq and so forth. Frankly, while it looks like a lot of money, the effort has not been really put to think smartly, intelligently, long-term about what do we do to reduce our vulnerability here.

COLLINS: Yes, well I think there will be a lot of discussion ahead about that, certainly, and what can be done simultaneously in theater and in countries surrounding particular countries that this country has named as terrorist lands where people are training and so forth. We've had a lot of discussion about that with the 14 different countries that will be going through different systems in order to make sure people are safe before coming into this country.

So, what's the number one thing if you sat down with maybe the Homeland Security Secretary yourself, Janet Napolitano, what would you say to her?

FLYNN: I'd really say two things. One is of course that we absolutely have to make the homeland security effort a priority, and you have to be willing to look clear-eyed at the gaps and ask the hard question. Put yourselves in the shoes of a potential would-be terrorist and look at the systems we have in place, and do they pass the smile test.

I'm afraid airline security is our crown jewel. If you look at what's going on in port security in terms of challenges there, in regard to our electric power grid vulnerabilities of chemical plants and refineries and so forth, we have a very long ways to go.

The second piece is, and I think this is something that Secretary Napolitano has tried to do is remind us this is an all-hands evolution. Basically, there's limits to what the federal government can do to protect a country as big and open as this one, and so it's a shared responsibility. Remind Americans that we are resilient as a people. We have the ability to deal with crisis, adversity and overcome it and there are other societies like Israel and the United Kingdom that are basically been dealing with terrorists a long time. We should learn lessons from them as well.

That is how you manage these events and how you recover quick from these events is a very important part of the strategy, and we simply haven't invested enough in that. Thinking through what if these things happen, what are the safeguards in place, and if they fail, what do we do to basically rapidly recover so that the government doesn't look like keystone cops, which is a bit of what's been going on here lately. And people lose confidence and ultimately we get very discouraged, legitimately that folks in charge are not doing what they should be doing.

COLLINS: Absolutely. Stephen Flynn is the author of "The Edge of Disaster: Rebuilding a Resilient Nation." Stephen, thank you.

In fact, we are getting reaction on all of this from Homeland Security Secretary Janet Napolitano right now. I'm watching her sit down with our Jeanne Meserve, an exclusive interview taking place. We'll bring you part of it just as soon as possible.

If you think you have it bad, check this out. Much of Britain is covered in snow today. Up to 15 feet in places. A lot of cancellations at airports and train stations. And in Hamburg, Germany, the river Elva is caked in ice. Not much travel there either, as you would expect.

Rob Marciano is watching all things domestic. Now we have snow in the forecast for the South. And yes, I guess, Atlanta, huh?

(WEATHER REPORT)

COLLINS: Yes, absolutely. All right. We're watching all of it across that entire very cold map. Except for the desert, I heard you say that.

All right, Rob, thank you.

Schools at risk. California lawmakers make a push for federal funds to help out. We'll tell you about the new rules that would affect students and parents.

(COMMERCIAL BREAK)

COLLINS: Time now to check some of the top stories we're watching. Sources tell CNN Senator Chris Dodd is ready to announce he will not run for re-election this year. The Connecticut Democrat has been in the Senate since 1980. The news comes one day after another Senate veteran, Democrat Byron Dorgan, announced he also will not run again. The announcements put both seats in play in the critical midterm elections.

Making it easier for the families of fallen heroes. A new center is opening at Dover Air Force base in Delaware this morning. Dover is where the bodies of those killed in action come home. The new center is staffed by counselors and other support staff to help families deal with the loss of their loved ones.

New York business, political and civil rights leaders are gathering in Manhattan today to remember one of their own. Funeral services for attorney Percy Sutton begin at the top of the hour at the famed Riverside Church. The man who once represented Malcolm X is perhaps best known for leading the revival of Harlem's renowned Apollo theater. He died at the end of December at age 89.

Jobs for many people, that is issue number one. And we are happy to report new numbers today that show the job market is improving a bit. Susan Lisovicz on the floor of the New York Stock Exchange with more details. Hey there, Susan.

SUSAN LISOVOICZ, CNN CORRESPONDENT: Hey, Heidi. The headline really is that the U.S. economy is still losing jobs. The perspective here, though, and the trend, which is clear and decisive, is that we're losing far fewer jobs.

ADP, which is a huge payroll processing firm, says 84,000 jobs were lost last month. That is the smallest amount since March of 2008. We actually saw the services sector add jobs, and that's the biggest part of the U.S. economy. We've got a separate report from Challenger, Gray and Christmas, Heidi, and it said planned job cuts fell to the smallest amount in two years. So, a very clear and dramatic trend that we've been seeing for the last year now, Heidi.

COLLINS: Yes. But it seems like it's almost the lesser of many evils, if you will. That's December, but then when you look at the job market for the rest of the year, a different picture.

LISOVICZ: It's a terrible picture, and unfortunately, far too many of us know this situation firsthand. ADP says 4.7 million jobs were lost in 2009. The auto sector, not surprisingly, hit the hardest.

But most of the losses, Heidi, were concentrated in the first quarter of last year. Remember March of 2009? we lost nearly 750,000 jobs in one month. It has improved steadily since then. If this trend continues, net-net, we could see gains and we could see them soon.

How soon? Friday, we have the broadest picture of the labor market -- that comes from the government. The estimate is for it to come in flat. But, you know, it's always kind of just an educated guess. So, there's some optimists that think we could actually see a first gain in two years.

We are seeing some gains on Wall Street, but they are very modest indeed. The Dow is just up 2 points...

COLLINS: And dwindling!

LISOVICZ: The NASDAQ, well, the NASDAQ is down 2 points. It's kind of, you know, just sort of there right now, Heidi.

COLLINS: Okay. We'll watch for the rest of the trading day for sure. Susan, thank you.

California's budget crisis forcing lawmakers to overhaul the state school system in order to save it. CNN's Casey Wian looks at some controversial changes that would have to be made.

(BEGIN VIDEOTAPE)

CASEY WIAN, CNN CORRESPONDENT (voice-over): California public schools are being described as dismal, sad, hemorrhaging, in crisis, frightening and unacceptable. Those aren't the words of school critics but of state school districts describing themselves. The California School Boards Association plans to deliver a stack of letters from its members to Governor Arnold Schwarzenegger Wednesday, urging him not to make further cuts in education funding to reduce the state's budget deficit.

SCOTT PLOTKIN, CALIF. SCHOOL BOARDS ASSOCIATION: They're doing things like closing schools, increasing class size, especially at the lower grades where it is so important to have as much of that one-on- one contact as you can have when you're trying to teach kids how to read. You're completely disintegrating the support system for schools, whether it's counselors or librarians or nurses in every school.

WIAN: The group says during the past two years California has made larger per people cuts in education funding than at any time since the great depression. To stop the bleeding, the State Legislature is about to overhaul its public school system to make California eligible for $700 million in federal race to the top education funding. Its controversial provisions include allowing parents to remove their children from under-performing public schools and enroll them in a school of their choice, giving parents more power to force changes in schools and requiring weaker schools to conform to new federal guidelines.

BRIAN NESTANDE (R), CALIFORNIA ASSEMBLY: It's somewhat embarrassing I think for the state of California to have to have the federal government, President Obama come in and say here's how you should fix your schools in California. I think that's a problem, but I don't other solutions.

GLORIA ROMERO (D), CALIFORNIA ASSEMBLY: For too long we in Sacramento have to some extent looked the other way when it comes to in particular dealing with students in California who have languished in persistently under-performing schools.

WIAN: Governor Schwarzenegger visited one of those under- performing but improving schools Tuesday.

GOV. ARNOLD SCHWARZENEGGER (R), CALIFORNIA: We want to basically say in education we don't want to take it any longer. The status quo is not acceptable. We can make changes.

WIAN: As Schwarzenegger begins his last year in office, the former movie star is asking California's media to shift the spotlight away from him to the state's under-served schoolchildren.

(on camera): California's failing schools will be just one of the items the governor is expected to discuss in his final state of the state address Wednesday. On Friday, he'll unveil his last budget, which as of now is $21 billion in the red.

Casey Wian, CNN, Los Angeles.

(END VIDEOTAPE)

COLLINS: So, you know about the two White House party crashers, but there was a third. You'll hear about him and the buzz over the breach.

(COMMERCIAL BREAK)

COLLINS: A Washington attorney has identified his client as the third of the party crashers at the White House state dinner back in November. The lawyer says Carlos Allen has been questioned two or three times by the Secret Service. CNN has not been able to independently confirm the man in this video, the pictures, is Allen. Allen is the publisher and owner of "Hush" magazine.

The Secret Service says the man who wasn't on the official guest list made it into the dinner by traveling with the Indian delegation from an area hotel. The Secret Service also says the man went through all security measures before getting on the bus to the White House.

Anderson Cooper talked about the security breach on "AC 360" last night with "Washington Post" columnist Sally Quinn and CNN national security contributor Fran Townsend.

(BEGIN VIDEO CLIP)

SALLY QUINN, COLUMNIST, "THE WASHINGTON POST": I think that what happened at the White House was as big a security breach as the Christmas Day bomber situation because the White House should be the most secure place in the entire world, and the president could well have been assassinated if one of these three people had had explosives in his or her underwear.

So, the idea that three people separately could walk right into the White House with no identification at all and no screening and just march right in there I think is...

ANDERSON COOPER, HOST, "AC 360": Who do you think should be held responsible?

QUINN: Well, I think in the case of the White House situation, I think the social secretary, Desiree Rogers, and the head of the Secret Service, Sullivan. Both should be held responsible. I think they both should resign.

COOPER: Well, at least the head of the Secret Service went to testify before Congress. The social secretary, the White House, you know, decided not to send her because they thought it would be inappropriate and has really, I guess, said nothing publicly about it. Fran, what do you think needs to be done with security procedures to make sure this thing doesn't happen again?

FRAN TOWNSEND, CNN NATIONAL SECURITY CONTRIBUTOR: Well, Anderson, let's be clear. Mark Sullivan didn't just go up to Congress, he went up and took the hit for the administration on this. Said the Secret Service made a mistake, and he was committed to strengthening the Secret Service and improving their procedures. He's set about doing that.

They have reviewed their protocols with the State Department. They're reviewing their physical security procedures. I'm not sure I know what gets gained by firing Mark Sullivan, the head of the Secret Service, when what we really need is -- he's an experienced career officer of the Secret Service. What we need him is to lead this review and to tell us how we can do it better.

COOPER: Sally, you observed Washington for a long time. It seems to me people used to kind of resign honorably because mistakes were made.

QUINN: Well, that...

COOPER: Is that just gone, that whole idea?

QUINN: Well, that is a larger point is that the president of the United States needs to be protected and everybody -- and I'm not -- I'm talking about from a publicity point of view now and a perception point of view, not physically as well.

But everybody who worked for the president is a hired hand, and everyone has been to be a loyalist, and their one job is to make the president look good and to make it appear that he is strong and a good leader and competent.

And what happens when there are these terrible mistakes and breaches of security and nothing happens and Desiree Rogers doesn't even bother to go up to the Senate and testify, you have a situation where it looks like the president is incompetent and that he's weak.

So, what somebody needs to do is to say I'm going to take the hit, because that way it will take the onus off the president of the United States and it make him look stronger and look like a better leader, not only among our people in the United States but for people all over the world. Otherwise, it looks like he's lost control of the situation.

(END VIDEO CLIP)

COLLINS: Allen's lawyer says his client was an invited guest at the state dinner. The attorney said he had seen a copy of what appeared to be a White House invitation, even though he admitted never having seen one before.

Beautiful but busted. Thousands of profiles removed from a hottie Web site. Blame the eggnog for this one.

(COMMERCIAL BREAK)

COLLINS: Putting on a few pounds over the holidays has never been so easy to take off. Taken off the list of beautiful people, that is. Here's CNN's Jeanne Moos.

(BEGIN VIDEOTAPE)

JEANNE MOOS, CNN NATIONAL CORRESPONDENT (voice-over): Imagine you're a beautiful person on the dating Web site called BeautifulPeople, and all that holiday food was just too beautiful to resist and you gained a few pounds.

UNKNOWN MALE: We've had over 5,000 of our newly-chubby members who have been removed from the site.

MOOS: 5,000 members dumped like a second helping. In the words of the founder of BeautifulPeople, letting fatties roam the site is a direct threat to our business model.

UNKNOWN FEMALE: It's a very ugly thing that they're doing. It's hideous.

MOOS: You can only become a member of BeautifulPeople if existing members of the opposite sex vote you on.

You probably think this Web site is about you.

Maybe both eyes, that's how we began a piece we did five years ago about the site.

MOOS (on-camera): What we need is a guinea pig, not him, me.

MOOS (voice-over): But despite our best efforts --

UNKNOWN MALE: Excellent.

MOOS: The photo I submitted was rejected. I didn't stack up.

MOOS (on-camera): At least I'm not alone. Four out of five applicants are rejected By BeautifulPeople.

MOOS (voice-over): Let them eat cake. Wait, better not eat any cake now that they say they're shedding beautiful people who packed on a few pounds. Members supposedly complained when they'd meet the actual person.

UNKNOWN MALE: And they hadn't looked as they'd represented themselves in their initial pictures.

MOOS: That's a shocker, huh?

UNKNOWN MALE: Yes.

UNKNOWN MALE: It is at least as yes to this because our members want it to be.

UNKNOWN FEMALE: This is insulting.

MOOS: Mia Amber Davis (ph) is a plus-size model who sees no pluses in this.

MOOS (on-camera): As you look at the BeautifulPeople, is there anything you would like to say to the BeautifulPeople?

MIA AMBER DAVIS (ph): They all deserve each other. Get a life.

MOOS (voice-over): She and we wonder if it could all be just a publicity stunt. Co-Founder Greg Hodge says no. When he looks in the mirror, he sees this, a 7.84.

MOOS (on-camera): How do you look at yourself in the mirror every morning when this is the kind of superficial thing you do?

UNKNOWN MALE: Look, is it politically correct? No, it's not. It's certainly very honest. People want to be with people they're attracted to. MOOS (voice-over): Those kicked off the site can re-apply to be voted back on. But you'd think even a guinea pig wouldn't be a glutton for punishment.

Jeanne Moos, CNN, New York.

(END VIDEOTAPE)

COLLINS: All right. So, we want to get to our blog question because we have been asking you all morning long because of the weather outside that a lot of us are experiencing, very, very cold, we put this sentence to you. "It's so cold that..." and we wanted you to finish the thought. We got hundreds and hundreds of responses on this.

Craig writes "It is so cold that I have to preheat the toilet seat with a hair dryer."

Laura writes, "It's so cold that a polar bear's teeth would chatter."

And Lane says, "I am sleeping in my workout clothes, sweats, sweatshirt, turtleneck and three layers of socks."

Phil writes, "When I went to start my car this morning, I think it actually said, 'Say what?'."

And Terrell writes, "It's so cold that I saw a polar bear with a coat on." Wherever he lives.

All right. Remember, we always like to hear from you so log on to CNN.com/heidi and share up comments with us on our blog.

I'm Heidi Collins, and I'm very cold. CNN NEWSROOM continues with Tony Harris.