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Secretary of State Clinton's Final Days in Office; Bill Richardson, Google Chairman Eric Schmidt to Visit North Korea

Aired January 5, 2013 - 18:00   ET

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


WOLF BLITZER, CNN ANCHOR: And you're in the SITUATION ROOM, happening now, the new showdowns looming with a new Congress ready to fight. We go inside, the next battle is ahead for President Obama.

Controversy and health crises. Unexpected health complications marked Hillary Clinton's final days as secretary of state.

And Google, why is the company's chairman visiting a rogue state with the former New Mexico governor? Bill Richardson, the veteran diplomat joins us this hour.

We want to welcome our viewers in the United States and around the room.

I'm Wolf Blitzer, you're in the SITUATION ROOM.

A new year, a new Congress and new cabinet to put together, and a very tough agenda for lawmakers and the president in the weeks ahead.

Let's begin our coverage right now with our national correspondent, Jim Acosta,. He's up on Capitol Hill where the battle lines.

Jim, are all ready being drawn?

JIM ACOSTA, CNN NATIONAL POLITICAL CORRESPONDENT: That's right, Wolf. Some things will not be changing in the new 113th Congress. John Boehner is still the speaker of the house. But there are lots of new faces up here on Capitol Hill and some of them are ready for a fight.

(BEGIN VIDEOTAPE)

ACOSTA (voice-over): The newly sworn in 113th Congress is so diverse it is redefining the term, ladies of the house. There are more women than ever before. Roughly a 100, add that to the approximately 43 African-Americans, 31 Latinos, 12 Asians, and seven gay and bisexual members of the House and Senate, and even the politicians themselves have taken notice.

REP. TAMMY DUCKWORTH (D), ILLINOIS: It means we reflect America more. You know, the district I come from is very diverse district. And it is good to see Congress starting to look like the rest of America. ACOSTA: But some things will stay the same on Capitol Hill. John Boehner survived the GOP defections to remain House speaker. Now surprisingly, the eyes of the famously emotional Ohio Republican welled up in tears.

REP. JOHN BOEHNER (R-OH), SPEAKER OF THE HOUSE: The American dream is in per peril, so long as its name sake is weighed down by this anchor of debt. Break it's hold, and we begin to set our economy free.

ACOSTA: That will be new easy task, with so many moderates gone from the Senate.

UNIDENTIFIED FEMALE: Here is the first woman.

(APPLAUSE)

ACOSTA: In some of their places, more partisans, like Democrats, Elizabeth Warren.

Do you think both sides can work together here?

SEN. ELIZABETH WARREN (D), MASSACHUSETTS: I hope so I really do.

ACOSTA: The banking industry critic will now seat on the senate banking committee as a hero to liberals.

DAVID AXELROD, OBAMA CHIEF CAMPAIGN STRATEGIST: There are people who sat in that senate and would do anything to stop her and to stop the kind of consumer protections she was fighting for. And now, she is a colleague.

ACOSTA: Now they have to deal with her.

AXELROD: Now they have to yield the floor.

ACOSTA: On the other side of the aisle, tea party Texas backed Republican, Ted Cruz, signaled to CNN, he will be fighting for conservatism, not compromise.

Were you despite disappointed on how the fiscal cliff went down?

SEN. TED CRUZ (R), TEXAS: I was. I think it is a lousy deal. I think raised taxes by $620 billion that is going hurt the economy. It is going to kill jobs.

ACOSTA: His party is already feeling feisty, on the next battle to come, whether to raise the next debt ceiling.

SEN. MITCH MCCONNELL (R-KY), MINORITY LEADER: We can't agree to increase that borrowing limit without agreeing to reforms that lower the avalanche of spending that is creating this debt in the first place.

(END VIDEOTAPE) ACOSTA: And there is another sign that old pattern of brinkmanship is back. On Friday, House speaker John Boehner told his Republicans conference behind closed doors that he will be insisting on spending cuts as part of any debt ceiling negotiation that is something the president said he will not discuss, but it is a sign, Wolf, that the battle lines are being drawn for this new congress, Wolf.

BLITZER: There is an area, and I know you have been looking into it, Jim, where there could be bipartisan and comprehensive immigration reforms, especially a lot of Republicans now think they have to reach out to the Hispanic community and show a little flexibility on this issue.

ACOSTA: That is right. We have seen indications from both the members of the House and Senate that they need to get with the program you might say, when it comes to immigration reform. They just have to look at what happened in the last election, in terms of how Hispanics voted overwhelmingly for President Obama.

But Wolf, if we're getting back to that pattern of brinkmanship on the debt ceiling and on the spending cuts, even Senate Republican whip John Cornyn said in a column in the "Houston Chronicle" that there may need to be a government shutdown to force the president's hand on spending cuts. We may be stuck in this pattern of brinkmanship for some time and that could get in the way of other times like immigration reform.

BLITZER: It certainly could. All right, Jim Acosta, thanks very much.

Just days after the House of Representatives caused a furor by refusing to vote on $60 billion aid package for thousands of victims of super storm Sandy victims, both chambers of the new Congress have approved the smaller $9.7 billion measure. The remaining $51 billion will be considered later this month.

Joining us now is Ken Feinberg, he is the founder and managing partner of the law firm, Feinberg, Rozen, LLP. Also somebody who worked on these kinds of issues for years. You have given away what? $25 billion to victims of 9/11, Katrina and several others, BP, and Virginia tech, and some of the others, so what is your role now as far as super storm Sandy is concerned?

KENNETH FEINBERG, FOUNDER, MANAGING PARTNER, FEINBERG, ROZEN, LLP: Liberty mutual, private insurers, with claims all over the Atlantic region has decided to set up a program to accelerate the processes of insurance claims arising out of Sandy. Anybody insured with Liberty first tries to resolve the claim in the normal course with Liberty. If that does not work, Liberty has asked me to set up an independent mediation program designed to place the insured and the insurer together with a neutral third party to try to resolve the claim quickly within a matter of four to six weeks, without resort to litigation.

BLITZER: So you will be mediating between Liberty mutual, if you will, and individuals who are not satisfied with the money that they are going to get from Liberty mutual if they paid all the premiums over the years?

FEINBERG: That is right. Home owners, commercial establishments, that business interruption claims of other claims (INAUDIBLE), automobile insurance claims, all of those claims first go to Liberty. Now in Katrina, Liberty resolved like 95 percent of those claims. But if you're not getting satisfaction, then this program will accelerate the processing in an effort to get it resolved.

BLITZER: But you were retained by Liberty mutual, right?

FEINBERG: Liberty mutual is paying the entire cost of the mediation program. I have gone out and reached out to about 40 mediators, so we'll have enough mediators available, Wolf, to handle the claims if, as I suspect, there are relatively modest number that passed to the state.

BLITZER: So this is private money going to individuals. You have nothing to do with the government. You're not giving government money away that Congress will appropriate?

FEINBERG: That is right, this is a purely private effort by the insurance company to do the right thing by its insurance and incinerate the processing of these claims in an effort to get the result quickly without resorting to the courts.

BLITZER: All right, at some point let's say they get the $60 billion through Congress and they are going to start to distributing money to individuals. You won't have a role in that, but you have given away a lot of money. Give us some advice, how they do that, how they make sure the people that really need it get it. They're not phony operations, people just trying to sock away a little money.

FEINBERG: Most importantly, two rules had to learn. There are two conditions I have learned out over the years. One, get the money out fast. Don't delay --

BLITZER: When you say get the money out fast, how do you know the money is going to the people who need it to most?

FEINBERG: The second thing you have to do is have the fully transparent process with the right oversight, the right people reviewing these claims or these requests for compensation so is that you have a certain comfort level, even with BP. We had over a million claims, a million claims that were about -- there were about 12,000 that were fraudulent, because we had a pretty effective anti- fraudulent mechanism in place.

BLITZER: Because right now, we are hearing a lot of stories, people who are not getting their money, they thought they should be getting from insurance companies. Forget about the government right now, but from insurance companies.

FEINBERG: This program that I'm involved with is designed to deal with the concern about delay and about amount. And I'm confident based on the Katrina experience, that this mediation program will be reserved for the relatively modest numbers of claims with the insured does not get satisfaction.

BLITZER: Because you had a major decision after 9/11 or Katrina or BP, you know, how much is a life worth? For example, if somebody died in 9/11 at the world trade centers, you had to determine how much the survivors would get. Those are possibly difficult decisions to make.

FEINBERG: They're all difficult, now with the insurance Sandy claims, you will probably see there are disputes over is it wind, rain, covered, Flood, not covered --

BLITZER: Unless you have flood insurance.

FEINBERG: Unless you have flood insurance. That is not Liberty mutual. It was, what was the business interruption because my business was closed, I lost a certain amount of profit or income, revenue, is that covered? Auto, what is the value of the automobile? That is a relatively straightforward calculation.

BLITZER: Does it make any difference if it was your house, your primary residence, which was destroyed alone, let's say along the southern shore of Long Island. Or if you're a millionaire and have a second home along the Jersey Shore, the Long Island shore. Do those issues come into effect?

FEINBERG: In the private insurance business, what is the contract? What is covered? What is insured? Your first home, the second home, your third home? You have to look at the policy, Liberty has made it very clear, it wants to resolve --

BLITZER: What about the government money that will be allocated?

FEINBERG: Now, most of the government money, I suspect, I have not looked at the appropriation, I bet you the great bulk of that money is for community purposes, bridges, roads, sewers, water. I doubt that much of that government money is going to be reserved for individual payments, for individuals residing in the area, FEMA. And most of that money, I suspect, as in Katrina is going to go to community-wide improvements.

BLITZER: One final question, Ken. What is the most difficult kind of decision you had to make in giving away money, government money to the victims of 9/11, or BP, or Katrina, the Virginia tech shooting. These other areas where you were asked to distribute funds?

FEINBERG: In all of these cases whether it is BP or 9/11, or Virginia tech, any of them, the emotion that you confront with people who justifiably have been wronged through no fault of their own. They are innocent victims. They are frustrated by life's misfortune. And you have to try and empathize with people, understand what they confront, and that is the most difficult asylum is being sort of try to be a psychiatrist, in trying to gauge that emotion and try to deal with them as best you can.

BLITZER: Ken Feinberg, good luck.

FEINBERG: Thank you.

BLITZER: A key architect of fiscal reform says, Congress at the White House fell well short of what they had to do.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: We had a chance for our generation to do something big to put our fiscal house in order. And we absolutely blew it.

(END VIDEO CLIP)

BLITZER: My exclusive interview with Erskine Bowles, the former co-chairman of the Simpson-Bowles commission on the dangerous cliff the lie ahead.

Plus, surprising and dramatic twist to the end of Hillary Clinton's tenure as the country's top diplomat, what will her legacy be?

(COMMERCIAL BREAK)

BLITZER: Hillary Clinton's final days as secretary of state have been overshadowed by health scares and controversy. And it all making for a dramatic ending to what poll suggests was a stellar run as the country's top diplomat.

Our congressional correspondent Kate Bolduan is here in the SITUATION ROOM. She has got some details. And they are important details.

KATE BOLDUAN, CNN CONGRESSIONAL CORRESPONDENT: Very important details, Wolf. You know the end of 2012 was set to be marked with Hillary Clinton's farewell tour as the country's top diplomat. Things have clearly changed, leaving many to wonder with what lasting impact.

(BEGIN VIDEOTAPE)

BOLDUAN (voice-over): After logging more than 950,000 miles, visiting 112 countries, Hillary Clinton is known for keeping a grueling schedule and the joy something rarely seen anymore in politics, a huge approval rating, close to 70 percent in December.

OBAMA: She is tireless and extraordinary.

BOLDUAN: It seemed certain the secretary would end her tenure on a high note. But the closing chapter of her post has turned into anything but a fond farewell. Illness, a concussion, and most recently a blood clot has sidelined Clinton for more than three weeks.

VICTORIA NULAND, STATE DEPARTMENT SPOKESWOMAN: She is talking to staff. She is taking paper at home. She sounds terrific. She is looking forward to coming back to work next week. BOLDUAN: And she still faces tough questions about the September 11th attack on the mission in Benghazi, which threatens to leave a lasting stain on her three decades long career. Clinton told CNN in October, it is a disaster she takes responsibility for.

HILLARY CLINTON, SECRETARY OF STATE: I'm in charge of the state department, 60,000 plus people all over the world, 275 posts. The president and vice president certainly wouldn't be knowledgeable about specific decisions that are made by security professionals.

BOLDUAN: Beyond that mark on her legacy, that attack and the continuing violence in the Middle East, especially Syria, now become unfinished business that the secretary may leave behind.

AARON DAVID MILLER, VICE PRESIDENT, WOODROW WILSON INTERNATIONAL CENTER FOR SCHOLARS: We can't be ending that on a high. But I think it is part of a broader piece. This is not a slam dunk world. There were no spectacular successes to be had. There were only as I described elsewhere, migraines or root canals.

BOLDUAN: As she moves into the next chapter of her life and possibly a 2016 presidential bid, the real question is whether unfinished business may become political baggage.

MILLER: Her challenge is not going to be that Americans looked back and said why didn't you fix Syria, or why did the (INAUDIBLE) - how can the (INAUDIBLE) haven't give up quests their quest for weapons. I think the greatest challenge is going to be that she is running against history. Can you have another four to eight years of democratic rule after the last eight?

(END VIDEOTAPE)

BOLDUAN: Still, she is hugely popular both here and abroad. When asked about the number of goodwill, get well messages secretary Clinton has received following her illness, the state department spokeswoman will called it a tsunami of messages, so many people reaching out, wishing her well and wishing she gets back to work.

BLITZER: And yes, maybe the messages are working. Because it looks, at least according to her officials that she will get back to work maybe this coming week.

BOLDUAN: Yes, and that is something the folks at the state department looked at on a daily basis. What is the latest on her condition and recovery, and the latest we hear is she will be back at work next week, so, in the coming days. And everybody is very interested in how much she works when she does get back to work.

BLITZER: Thank you, Kate.

I spoke about the secretary with Paul Begala, and Ari F Fleischer. And I asked them how formidable presidential candidate she would be in 2016?

(BEGIN VIDEOTAPE) ARI FLEISCHER, CNN POLITICAL CONTRIBUTOR: She is very capable and owes it to the country, as Paul rightly pointed out she took responsibility for the head of the state department for what took place. And people want to know. People died, and we have a reasonable expectation that our diplomats can be protected when they go abroad and something goes wrong. Government officials, regardless of party, both in public, a very upfront explanation and they have to take the hard questions to make sure they thought through the answers.

So if that is coming up, she will deal with it. And that is her style, she will deal with it. I do accept absolutely that she has not in the past because of her illness. And hopefully she will be able to recover and testify.

BLITZER: You know, my sense has always been, and assuming she is emerging from this blood clot and concussion, and excellent shape and she is strong, healthy. Ari, how formidable of a presidential candidate would she be in 2016?

FLEISCHER: Well, you know, Wolf, I think everybody except for a few smart souls in Chicago thought she was unbeatable in 2008. 2016, I think you would have to say she would emerge the frontrunner for the Democratic Party.

But frankly, at the end of the day, I think she is not going to do it. I think it is a lifestyle of choice, a lifestyle issue. I think after all the years she has been a public life, she is entitled to relax and the good thing of life. I don't know that she want a burden. I think if she could get promised she wouldn't have to go through primaries and the primary process, she may want to do it and take on the Republicans. But to go through all the primaries again and the pancake eating in Iowa and everything you have to go through, that is a lot to impose on somebody again.

BLITZER: Paul, what do you think?

PAUL BEGALA, CNN POLITICAL CONTRIBUTOR: Well, first of all, nobody gives these things away nor should they. She wanted to be president, very much, and made, I think, historic and honorable run at is. It was the closest any woman has ever came to the top job in our country.

By the way, she was not wild about being the secretary of state. She loved being senator for New York. She loves Ari's state of New York. And God only knows why she does. And assertive wonderfully -- But she, I have no idea. The last thing she needs is another headache, certainly not one from me.

So, I think we ought to give her a couple of weeks, let her recover from this serious injury, actually, more than just a bump on the head. But, let her recover from that. Let her take a little time to figure this out. I travel the country, a lot of talk to Democrats everywhere. And she is beloved figure by everybody who supported her last time, but also by the folks who supported then senator Obama against her the last time. She will be incredibly formidable. But she will not be unopposed, I promise you that. (END VIDEOTAPE)

BLITZER: Paul Begala and Ari Fleischer, I guarantee you, we are going to have a lot more to talk about in the coming weeks, months and years about the secretary of state, Hillary Clinton.

When we come back it is much more than a regular army. Up next, disturbing new details about Iran's intelligence service.

Stay with us. You're in the SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: A new congressional reports speaks with tens of thousands of people as jobs description includes murder, terror and mayhem. We're talking about Iran's intelligence service.

CNN's Brian Todd has details of this disturbing new report.

(BEGIN VIDEOTAPE)

BRIAN TODD, CNN CORRESPONDENT (voice-over): Assassination plot, terrorist bombings, cyber war fare, tactics used around the world by Iran's intelligence service, one of the most aggressive spy operations in the world. That is according to a new report by government researcher commission by the Pentagon. The report says Iran's intelligence community has 30,000 people working for it. That's compared to just a hundred thousand 17 U.S. intelligence agencies and office.

From the standpoint of U.S. western national security what is the most dangerous operation that Iranian intelligence has its hand, do you think?

REUEL MARC GERECHT, FORMER CIA OFFICER: Well, I think the most dangerous thing is the terrorism. They have for decades now, developed networks with other terrorist groups, so they themselves don't necessarily have to do something. They can contract it out. They can encourage others to engage in terrorism against the United States and our allies.

TODD: Reuel Marc Gerecht, a former CIA officer who tracked Iranian intelligence through Europe and the Middle East says the Iranian intelligence and security used to conduct most Iranian- sponsored assassinations overseas. He says that unit killed Shapour Bakhtiar, the former Iranian prime minister, assassinated in Paris in 1991. But Gerecht says, now those operations have shifted to feared (INAUDIBLE), the shadow in Iranian military unit that is part of the revolutionary guard. What is the ministry of intelligence's biggest big job now?

GERECHT: They're primarily used as an instrument of internal repression, they know how to hurt people.

TODD: The report also says the Quds force is inside Syria, backing Bashar al-Assad's forces. Separate from the reforms, Congressman Peter King, chairman of the homeland security committee has said that Iran runs spies out of the mission to U.N. and here at the Iran intersection in Washington.

King made those comments after a plot was revealed to assassinate Saudi Arabia's ambassador to the U.S. The Iranian-American who pleaded guilty of that case, said he worked with Iranian military people to formulate the play. In the wake of that, king called for strong retaliation against Iranian diplomats in the U.S.

REP. PETER KING(R), HOMELAND SECURITY COMMITTEE: To me, it should either get rid of all of them or most of them and send a clear signal.

TODD: Iranian officials denied any role in trying to assassinate the Saudi ambassador in Washington. We called a meeting for comment on the latest report for the country's intelligence operations.

We got no response. Brian Todd, CNN, Washington.

(END VIDEOTAPE)

BLITZER: After the fiscal cliff, a bigger cliff, the debt ceiling fight.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: For God's sake, I wouldn't wait until the last minute. We have had enough of this brinksmanship, this moving from crisis to crisis.

(END VIDEO CLIP)

BLITZER: I'll speak exclusively with Erskine Bowles. He co- chaired the bipartisan panel which tried to head off this crisis.

(COMMERCIAL BREAK)

(END VIDEOTAPE)

BLITZER: Congress went to the 11th how and then beyond before agreeing on a deal to keep the country from going over the fiscal cliff. That tax agreement was signed into law this week. But more cliffs lie ahead, including the very dangerous problem of raising the U.S. debt ceiling.

And Erskine Bowles is joining us right now. He is the co-founder of the organization called Fix the Debt, which is obviously something important. Former White House chief of staff under President Bill Clinton and the co-sponsor of the Simpson-Bowles commission, designed to deal with debt relief and debt reduction.

Erskine Bowles, thanks very much for joining us.

ERSKINE BOWLES, FORMER CLINTON WHITE HOUSE CHIEF OF STAFF: Thank you, Wolf. I'm glad to be with you. BLITZER: All right. A lot important issues are on the table, But first of all, had you been a member of the house or Senate, how would you voted for that fiscal relief legislation?

BOWLES: Oh, look, I would have voted for it. You know, I think going over the cliff would have been an economic disaster for the country. It was too much. Too quick, too abruptly. And if you look at the cuts that were, you know, in the sequester, they are all discretionary items, not on deal with the things that need to slow the growth rate, and that is the entitlement programs.

And it did generate a little revenue for the company of country about $600 billion worth. So, I would have voted for it, It was a step in the right direction. But for sure, Wolf, it was a missed opportunity. I call this the magic moment, you know, where we had a chance for our generation to do something big to put our fiscal house in order. And we absolutely blew it.

BLITZER: In the next few weeks, as you well know, there will be at least three crisis points coming up, raising the nation's debt ceiling, dealing with what is called that chief sequestration, the automatic spending cuts and domestic spending cuts and national security. And also continued resolution to keep the government operating.

How would you deal with the crisis points in order to deal with what you want, which is the big picture and really getting to the bottom of this whole issue?

BOWLES: For God's sake, I wouldn't wait until the last minute. We have had enough of this brinksmanship, this moving from crisis to crisis. That is a foolish way for any organization, small or large, much less the U.S. government, the largest economy in the world to run its organization.

Here is what we got to do. We have got to do -- make the tough decisions. And we're -- you know, we're only about half way there of the things we have to do. We have got to make sure we reform our tax code, broaden the base, simplify the code, get rid of some of this back door spending in the tax code. We have got to slow the rate of growth of the tax code, if we don't slow the rate of the health care, it will absolutely bankrupt the company.

And finally, we have to make Social Security sustainably solvent. These are big items we have to deal with if we are going to stabilize the debt and get it on (INAUDIBLE). These guys have got to negotiate. They got to start working together. They have to put some of this ultra-partisan politics aside and deal with these very big issues.

BLITZER: But you know Washington right now, it is very dysfunctional, despite of the last minute dealings on the fiscal cliff. And there was bipartisanship at the very, very end. But, looks like the only one who deal with what we call small ball, they're not ready to deal with the big picture unless you see something there I'm not seeing. BOWLES: Oh, look, I can tell you what I see are the things that you said. You know, there is great uncertainty out here in the country. The markets are going to react at some point in time, and react severely to the lack of knowledge of what is going to go on, the uncertainty, you know.

And we do have the debt ceiling coming up. We do have a budget coming up. You know, we do have this sequester coming up. All of that creates great uncertainty. And what these guys have to do is start to act like grown-ups. And they have to start negotiating. Just like I might add we did in the 1990s when President Clinton actually sat down and negotiated with Newt Gingrich and Trent Lott, even when there was ultra-partisanship. People say the partisanship is so much worse today than it was then, hell, back then, they we trying to impeach the president. I mean, good God, se have had partisanship, but you have to put that partisanship aside and work together.

BLITZER: Here is what the president says repeatedly now when it comes to raising the so-called debt ceiling, it will have to be raised by February, early March, at the latest. I want to play a little clip. Listen to the president.

OBAMA: If Congress in any way suggests that they're going to tie negotiations to debt ceiling votes and take us to the brink of default once again, as part of a budget negotiation, which by the way we never did in our history until we did it last year, I will not play that game.

BLITZER: He says he wouldn't play that game. But Republicans say they will only raise the debt ceiling if there is an equal amount of spending cuts accompanying the raising of the debt ceiling. He says he is not going to play that game. Will he have any choice?

BOWLES: Look. That is the kind of brinksmanship I'm talking about. We should not negotiate on the full faith and credit of a U.S. government. That is crazy. Why would we want to put our economy through that? But there are lots of things we can negotiate on. We do have a sequester. We do have the end of the continuing resolution. We have lots of things coming up that will force us to make some of the tough decisions.

BLITZER: Here is what Mitch McConnell wrote in an op-ed on Yahoo! News. And I'm going to read it to you because he is going after the president. He is the Republican leader in the Senate.

"Predictably the president is claiming already that his tax hike on the rich is not enough. I have news for him, the moment that he and virtually every elected Democrat in Washington has signed off on the terms of the current arrangement, it was the last word on taxes. That debate is over."

What he is saying it is now all about spending cuts, no more discussion of taxes for all practical purposes. No more increases in taxes. It is all spending cuts. You agree with Mitch McConnell on that? BOWLES: I actually don't. I think the primary focus has to be on spending cuts. You know, we have got us slow over right of healthcare in particular. We have to make Social Security sustainably solvent, and we are going to have to do more in to discretionary front there. So, there is lots of work left to be done the spending side. And we haven't had enough discussions on that to date.

(END VIDEOTAPE)

BLITZER: We can't leave this mess to the next generation, just ahead, a warning from Erskine Bowles, as my exclusive interview continues.

(COMMERCIAL BREAK)

BLITZER: The panel of the Erskine Bowles co-chair tried to steer policy makers toward a path of fiscal stability, but they didn't listen. Could Bowles now try to make a difference from inside the Obama administration.

More now of my exclusive interview.

(BEGIN VIDEOTAPE)

BLITZER: Would you like to be the treasury secretary?

BOWLES: No.

BLITZER: OK, that is a pretty blunt answer, because you have seen your name floated out there as a possible successor to Tim Geithner.

BOWLES: And the reason I say that is look, I -- I'm 67 years old. I have been gone from home for over a dozen years, doing various public service things. And I have come home, I have got nine grandchildren under seven, and I really want to stay home. So I don't want a full-time job either in the public or private sector.

BLITZER: One final question, how disappointed were you that the president rejected the Simpson-Bowles recommendations?

BOWLES: Well, look. I was disappointed at the time. But I came to understand that what he was doing was his goal was to use it as a framework for his discussions that he had with speaker Boehner back in God, almost two years ago now in his first effort to get a grand bargain. He felt that was the best way to be successful. If he had been right, he would have proven to be a political genius. Unfortunately, he was not. They didn't get a deal done and so, I was very disappointed.

BLITZER: Yes, I think that was an historic moment to try to do that grand bargain. I know you and Alan Simpson worked hard on it together with other members of your commission. It was clearly a missed opportunity, certainly with hindsight, at least that's what I think and I know you agree. BOWLES: And we're going to keep working on it. This is -- our generation, Wolf, yours and mine, we're the ones that created this fiscal mess. I don't care whether you're a Republican or Democrat, together we created this mess. And it is our responsibility to clean it up. We can't leave this to the next generation.

BLITZER: Erskine Bowles, thanks for all that you have done. Thank Senator Simpson for it as well. And we'll stay in touch, as well.

BOWLES: Thank you, sir, good to talk to you.

(END VIDEOTAPE)

BLITZER: Against the advice of the U.S. government, the executive chairman of Google is going to North Korea. Can he persuade the young North Korean leader to open up on the flow of information, at least a little bit? I will talk more about that and more with the man traveling with him to North Korea, the former U.S. ambassador to the United Nations, Bill Richardson.

(COMMERCIAL BREAK)

BLITZER: Some stunning travel plans in the works right now. The Google chairman, Eric Schmidt, will be traveling to North Korea. He will accompany the former New Mexico governor bill Richardson, the former U.S. ambassador to the United Nations, on what is described as a private humanitarian visit.

I traveled to North Korea with governor Richardson two years ago the last time he was there. He is standing by to join us in just a moment. But first, listen to what the state department says about the upcoming planned visit.

(BEGIN VIDEO CLIP)

NULAND: Frankly, we don't think the timing of this is particularly helpful, but they are private citizens and they are making their own decisions.

(END VIDEO CLIP)

BLITZER: And joining us now is governor Bill Richardson.

So governor, how come you're going against the wishes of the state department, and heading off to North Korea?

BILL RICHARDSON, FORMER NEW MEXICO GOVERNOR: Well, I understand why they're cautious. This is a very sensitive time in diplomacy with North Korea. We're not happy with what the North Koreans have been doing, but I'm a private citizen, this is a private humanitarian mission. We postponed at their request once, right before the South Korean elections. And there never seems to be a good time to go.

In the past, I have postponed visits to North Korea at their requests, but I felt at this time because of the humanitarian nature of the trip, the fact that there is an American detainee there, I heard from the son of the detainee, (INAUDIBLE), I think it is important we go. It is a brief visit. Eric Schmidt is going as a private citizen. This is not a Google visit. And so I hope that the state department is appropriately cautious, but obviously, they have gotten a little bit of concern. But we're going to be fine.

BLITZER: So one of your goals is to bring home this American citizen who has been detained in North Korea, is that right?

RICHARDSON: Well, our goals are several. But, the primary mission is humanitarian. We're going to look at the human situation in North Korea, the poorest nation in the world. The detainee issue is another one. We're going to try to see the detainee. I think it is going to be difficult to bring him back, because the judicial process there has not even commenced. Third, we're going to obviously talk about some of the nuclear issues, very concerned about a possible nuclear test. Concerned about recent actions by the North Koreans.

But these are unofficial. This is not in any representation from the department of state or the administration. It is a two to three- day visit. And we hope to come back as I have over the years, the last 15 years, I have had success in negotiating with the North Koreans.

BLITZER: Any chance that you will meet with the new leader there, Kim Jong-Un?

RICHARDSON: Very doubtful. I think they have the leadership of their country meet only with the appropriate government leadership from other countries. So because this is a private visit, I don't believe we'll meet with him. But we will meet with a variety of officials from the foreign ministry, from the economics ministry, from the military. It will be a wide ranging visit where we get a chance, not only to talk to a number of North Korean officials, but a chance to get a look at the humanitarian situation there.

BLITZER: You I know you had a chance to review Kim Jong-Un speech that he gave on New Year's Eve, and I'm getting sort of conflicting interpretations. Is he trying to reach out to South Korea? Is he trying to reach out to the west? Is here a moderation in North Korea's position? Is it the same old, same old? What do you think?

RICHARDSON: Well, I am getting mixed messages. This is why we wanted to go and get an on hand assessment. On the one hand, his New Year's Eve speech talks about a dialog with South Korea. That is good. The new South Korean president is ready to engage.

Secondly, these launches that they have the undertaken are not conducive to six-party talks to the negotiations to the international community feeling comfort with a discussing issues with North Korea. It seems that the new leader is trying to strengthen himself domestically with his own people, the fact that the launch a year ago failed, now it succeeded. And so, that bothers him internally, plus internationally, you know how the North Koreans are, they like to send a message, hey, we are around, we are players, we have nuclear weapons. The international community should pay attention to us.

BLITZER: When I was there with you two years ago, almost exactly two years ago, it was a tense time on the Korean peninsula. There was military exchanges between north and south Korea. As you well remember and I certainly remember, how would you describe the situation on the Korean peninsula now as compared to then?

RICHARDSON: Well, it's still very tense. Obviously, these launchers have provoked a lot of concern. The nuclear tests have provoked more concern t security council is considering additional sanctions, so the situation is tense. The relationship between North Korea and South Korea, if what the new leader has talked about, which is a dialog, maybe things are calming down a bit. Maybe there's an opportunity for a new dialog, there's a new leader in North Korea. And a new leader in South Korea.

So, hopefully, this is going to be the key, how the two Koreas work with each other. But, I just do think that the six-party countries, Russia, China, the U.S., Japan, South Korea, I think perhaps a new approach is needed in dealing with North Korea.

I'm very concerned about North Korea's recent actions, but a new kind of dialogue perhaps is needed. But again, I'm on a private humanitarian mission, I'm not representing the U.S. government. Eric Schmidt is going also as a private citizen, not as a Google representative. We will make an assessment and see what come of our visit. But I think it will be a positive visit.

BLITZER: And your North Korean adviser, Tony Namkung is going along on the trip as well. He has been there, many, many times.

RICHARDSON: That's right. Tony Namkung is joining us. He is annex pertain on North Korea. He knows Asia very well. And so, it will be an interesting team.

BLITZER: Hey, governor, be safe over there and we will stay in close touch, good luck.

RICHARDSON: Thank you. Thank you very much.

BLITZER: All right. It's a bird. It's a plane, we have a very different story many coming up when we come back. It's superman, well sort off. Jeanne Moos, she is next.

(COMMERCIAL BREAK)

BLITZER: Here is a look at the hot shots.

In India, look at this. Firefighters want smoke rise after the destruction of a century he old warehouse.

In Germany, an honor guards lose a former defense minister at his funeral.

In Australia, a man jumps off of a pier into the water to find relief from the heat. And in Japan, J the sea lion paints a Chinese character brush in his mouth.

Hot shots, pictures coming in from around the world.

It's a bird, it's a plane, it's a remote control device that looks often a lot like superman. Now, while that phrase may not necessarily catch on, the superman flying machine most certainly is.

CNN's Jeanne Moos has that story.

(BEGIN VIDEOTAPE)

UNIDENTIFIED MALE: Here it comes.

JEANNE MOOS, CNN CORRESPONDENT (voice-over): He may look like the man of steel, but he is actually the man of light weight foam.

UNIDENTIFIED MALE: Faster than a speeding bullet.

MOOS: And actually, his top speed is 30 miles an hour. But the sight of superman flying above the California coast was enough to make a cyclist stop and shoot it, the video went viral and now folks are wondering --

UNIDENTIFIED MALE: Look up in the sky, it's a bird, it's a plane, it's superman.

MOOS: Yes, superman was 5'2", and weighed less than two pounds. It's a sensation in a local news.

UNIDENTIFIED FEMALE REPORTER: Big question, where did they hide the propeller?

(LAUGHTER)

MOOS: It's not nice to laugh at superman, but we will show you on the female version, super girl.

With electric motor and a battery that goes on her head. Gary Graf built about a dozen of these remote control figured. He is a former air force test pilot with a long career in aviation. He even customized superman, the cape that he had to shorten to keep his super hero aerodynamic.

GARY GRAF, REMOTE CONTROL MODEL ENTHUSIAST: It add as lot to how it looks and plus, it sounds really cool when it's flying by --

OTTO DIEFFENBACH, SUPERMAN MODEL CREATOR: It's removable.

MOOS: They plan to launch a business. In a few months, selling slightly smaller remote controlled figures for under $500 each. The buyers would assemble and customize their super heroes.

DIEFFENBACH: What I like to show off are her heels on the back.

MOOS: She is very shapely, actually.

DIEFFENBACH: She actually started as a nose art, you know, like the old aircraft had nose art.

MOOS: Honored after pin off girls, but Super girl's anatomy offered engineering opportunities. You mean her breasts are actually landing gear?

DIEFFENBACH: Yes. Silicone implants so she'd roll along the ground and have graceful landings.

MOOS: While the men have to sort of sticking their landings, she is shapelier than a speeding bullet.

Jeanne Moos, CNN.

Hey, get your hands off of her Gary.

DIEFFENBACH: Is my wife going to see this?

MOOS: New York.

(END VIDEOTAPE)

BLITZER: Very funny stuff.

Remember you can what is going on here in the SITUATION ROOM on twitter. You can tweet me @wolfblitzer.

I'm Wolf Blitzer in the SITUATION ROOM. The news continues next on CNN.