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Anderson Cooper 360 Degrees

Obama Institutes Sweeping Changes; Caroline Kennedy Drops Out

Aired January 22, 2009 - 22:00   ET


Tonight: President Obama making sweeping changes when it comes to torture, fighting terror, and the prison at Guantanamo Bay.

Also tonight, the economy in crisis, worse than we thought, mass layoffs for the first time ever at Microsoft, some of the worst employment figures in decades -- massive new challenges for the Obama administration. The question tonight, can they deliver?

Also, a political shocker -- Caroline Kennedy says she doesn't want to be senator. The mystery is why. We have got some possibilities.

And a perk of being president -- tonight, Barack Obama goes on board the plane the world knows as Air Force One. We will give you an inside look at his maiden voyage.

First, though, President Obama, who today began unraveling nearly eight years of policy since the 9/11 attacks, unwriting with the stroke of a pen eight years of controversial procedures for handling terror suspects and keeping them locked up initially beyond the reach of the law, trying, he believes, to undo some of the damage done to America's standing in the world.

Now, others disagree about both the diagnosis and the new treatment. Tonight, you can decide for yourself.

The facts from Ed Henry.


ED HENRY, CNN WHITE HOUSE CORRESPONDENT (voice-over): Day three, and President Barack Obama is staying on message, signing three executive orders striking right at the heart of former President Bush's approach to the war on terror, including a ban on the use of torture and a demand the U.S. military prison camp at Guantanamo Bay be closed within one year.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: The message that we are sending around the world is that the United States intends to prosecute the ongoing struggle against violence and terrorism. And we are going to do so vigilantly. We are going to do so effectively. And we are going to do so in a matter that is consistent with our values and our ideals.

HENRY: But Mr. Obama did not take any questions from reporters about what will happen to the prison's 245 terror suspects.

OBAMA: We're not doing a Q&A session.

HENRY: He left that task to Press Secretary Robert Gibbs, who, in his first White House briefing, said the administration is still working on a plan.

ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: One of the things that the executive orders does is begin the process whereby the current administration can examine what exactly is going on and who exactly is there.

HENRY (on camera): So these are terror suspects, and the American people are hearing, "Washington's going to study it." They're going to find out for a few more months, what are we going to do with these detainees? So what...

GIBBS: Well, this is day two.

HENRY (voice-over): Actually, it's day three for an administration anxious to show it's also all over the financial crisis, Gibbs revealing, the president is now getting an economic daily briefing, prepared with the same care as the president's vaunted intelligence briefing.

GIBBS: The president asked that this be added each day to his schedule, as the country is in the midst of an economic crisis and an economic emergency.

HENRY: There were other tough questions, such as whether the president is violating the spirit of one of his own executive orders.

OBAMA: If you are a lobbyist entering my administration, you will not be able to work on matters you lobbied on.

HENRY: But the president recently nominated William Lynn, a lobbyist for defense contractor Raytheon, to be deputy defense secretary.

With some fellow Democrats suggesting the nomination may be in trouble, Gibbs said the White House wants to make an exception.

GIBBS: The president believes that, as these experts do, that a very limited number of waivers...

HENRY (on camera): But he's not really closing the revolving door, though?


HENRY (voice-over): The president, paying an unannounced visit to the White House Briefing Room later on, was pleased with his spokesman's first day.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I'm very proud of him today. And, you know, he got a fist bump from me. HENRY: Gibbs is from Alabama, so he can sidestep tough questions with Southern charm, which may be exactly what the president wants.


COOPER: Ed, President Obama really on pretty much of a whirlwind, unraveling previous Bush administration policies. What happens tomorrow?

HENRY: Tomorrow, he's going to bring Republicans in here for the first time as president, meeting with the congressional leadership in both parties, and really try to push that economic recovery plan through the Congress.

But Republicans have been raising a lot of objections to the price tag, some of the details. But it's slowly making progress on the Hill. It's starting to get through some committees. So, they're confident that, while he's been pushing through these executive orders, largely on national security, that, meanwhile, on the Hill, he's getting, slowly, but surely, what he wants in this recovery package, as he hopes to give it a push here tomorrow at this meeting.

COOPER: All right.

HENRY: Anderson.

COOPER: Ed Henry at the White House -- thanks, Ed.

On that note, we learned this afternoon that the Senate plans a Monday vote on Timothy Geithner for treasury secretary. Now, the Senate Finance Committee today voting 18-5 to recommend confirmation. If, as the Obama administration says, the economy is riding on his confirmation, it can't happen too soon.

Today brought another wave of deeply troubling news, including mass layoffs, for the first time ever, at Microsoft. We're talking about your money, your future, big worries.

And, as always, Ali Velshi is with us.

Ali, we learned today that the number of people filing for unemployment high a 26-year high last week. Any indication that things are getting any better?

ALI VELSHI, CNN CHIEF BUSINESS CORRESPONDENT: Well, there was some suspicion that January would be tough, Anderson, as companies sort of do their laying off ahead of the fiscal year.

But look at that number, 589,000 people lining up last week. As President Obama was getting ready to take his new job, these folks were filing for unemployment claims for the first time. And can you imagine that, almost 60,000 people a week? That's up 62,000 from the week before?

Now, let's talk about these layoffs. Microsoft has had layoffs before, but never these kind of layoffs, never this size. Microsoft is like -- you know, it's like the electrical company or the water company. It sells something everybody needs.

Look at these companies. This wall is not big enough for the list of companies that have announced worldwide layoffs this week alone, three working days this week, Intel, 6,000 people, Microsoft, 5,000 people, Ericsson, 5,000 people, Williams-Sonoma, 1,400 people. They're closing stores, so many of these. You know what the total is for three days so far, Anderson? More than 30,000 layoffs have been announced this week alone. And we're not done with the week yet -- Anderson.

COOPER: The job losses put even more pressure on the president to pass the stimulus package. He's already getting political roadblocks in pushing it through. You say it's all centered on this decades-old debate. How so?

VELSHI: Yes. And it really is the oldest debate in the book about what you do. Everybody understands money that can ultimately solve an economic problem. But where does the money go?

There are two sorts of ways of looking at that. And I will tell you, to our viewers out there, it's a massive oversimplification, but let me tell you, the one way is that money comes from the top. You cut taxes on the wealthy, you cut taxes on major corporations, people who save the money that they would otherwise be paying on taxes or companies that save that money reinvest it in the system. They create factories. They create jobs. They create employment opportunities. And that's how the economy ultimately gets repaired.

The other way of looking at things is that you take that money from the bottom up. You have seen the e-mails from our viewers saying, why don't they just divide up that $800 billion and give everybody a check, and that you put that money into the hands of consumers? Maybe it's a check. Maybe it's a tax cut. Maybe it's a jobs program. Maybe it's employment benefits that are extended, or COBRA benefits.

And people then have a little more money. They start spending it. And that's how the economy gets fixed. Do you do it from the top or do you do it from the bottom? This administration is actually looking like it's coming up with a recovery plan that's going to do a bit of each, probably a little bit more bottom-up than top-down, maybe about 60/30 or something like that. But that looks like what they're going to try.

It's never been tried that way before, Anderson, and we're just hoping that that's not $800 billion that starts to dissipate through the system.

COOPER: Ali Velshi, thanks very much.

We're talking about your money, your future. Let us know what you think about it all, what is on your mind tonight. Join the live chat happening now at And check out Erica Hill's live Webcasts also during the break.

Up next, though, digging deeper on the economic storm clouds President Obama now face with our panel, David Gergen, John Ridley, and Ed Rollins.

Also tonight, the mystery of why Caroline Kennedy decided she didn't want to be senator, and the conflicting reports about whether New York's governor even planned to offer the job to her.

Then, Mr. Obama on board Air Force One for the first time -- what it was like for him on board the plane that will be his for the next four years.


OBAMA: I have got to say, you're out of central casting.


OBAMA: You're exactly what I want the pilot of Air Force One to look like.



COOPER: President Obama on Inauguration Day, new photos we saw today for the first time from "TIME" magazine, behind the scenes, a few quiet moments before the event that someone called Woodstock without the mud, family scenes, some times with daughters, Malia and Sasha, the only two daughters in the land that can bring a note from dad into school excusing them from just about everything, practicing the oath with the soon-to-be first lady, for all the good it did a short time later, though. We're told that Chief Justice Roberts also practiced for weeks.

We will be showing you more of these remarkable photos shortly. And the photographer who took them gives us a rare behind-the-scenes account of what the Obamas are really like. That's later on tonight.

But, first, the actual hard work, a lot to talk about.

Let's dig deeper with senior political analyst David Gergen, National Public Radio and founding editor of, John Ridley, and GOP strategist Ed Rollins.

David, you heard in Ed Henry's report that President Obama is going to be getting a daily economic briefing, similar to the daily intelligence briefing that presidents always get. You have worked in -- in four White Houses. Is this unprecedented? I mean, do presidents normally get a daily economic briefing?

DAVID GERGEN, CNN SENIOR POLITICAL ANALYST: Never happened before, to my knowledge.

And I think it's a very good move. Whether he will also get from Larry Summers, who is going to be conducting these briefings, a written summary of the events, as he gets from the CIA, is unclear. But that daily briefing will focus him on economic issues, at a time when many around him think, Anderson, that, amidst all this joy, that the clouds are darkening very rapidly on the economy.

They're worried that the unemployment numbers, the number of jobless is actually going to increase over what it was the last three months -- 500,000 a month loss over the last three months, they worry it's going to go up higher than that.

The -- they had a bad report from the Congressional Budget Office yesterday that said their stimulus plan for spending on infrastructure, actually, less than half of that money will be spent in the next couple of years or so, that most of it will go out pretty late...


COOPER: Right, that a lot of these projects are not shovel-ready and may not be shovel-ready until 2010.

GERGEN: Right. And that's one of the things the Republicans are going to press in that meeting tomorrow with him and early next week.

They think we ought to go for more tax cuts and fewer of these infrastructure projects. The Democrats don't think that's a wise way to go. So, he's -- and, beyond that, there's this -- we're in this grip of an international set of questions about banks.

Both in the United -- United Kingdom and the United States, there are growing questions whether the banks are weakening so rapidly, that they might have to be nationalized. That will come at enormous cost, and it would be an enormous intervention by the U.S. government. So, there's an awful lot that is piling up for him right now.

COOPER: Ed, how hard are Republicans going to be pushing back on the stimulus plan?

ED ROLLINS, CNN SENIOR POLITICAL CONTRIBUTOR: I think they are going to push very hard.

I think, obviously, they're not in a position to where they can control any part of this process. But I think, at this point in time, there are certain things that they believe very deeply in. Tax cuts is one of them. They want to make sure the public's money is not being wasted.

And I think the biggest problem now is, we're not sure. There's a -- obviously, there's a lot of smart people in the White House that the president brought in there. But there's a lot of different plans. There's not one plan.

And I think, to a certain extent, people are worried about, do we spend all this money and it doesn't work?

COOPER: John, I mean, that is what is so scary for so many people out there. No one really seems to know what to do. And no one seems to really have a grip on what has already been done, where the money that's been spent, where it went and why.

JOHN RIDLEY, COMMENTATOR, NATIONAL PUBLIC RADIO: Well, I think you bring up a really good point, Anderson, what people don't know.

I mean, remember, it wasn't that long ago President Bush famously admitted he didn't know the price of a gallon of gasoline had gone up to nearly $4 a gallon. So, the fact that Barack Obama is going to be briefed, obviously, as David pointed out, on a lot of the big issues, but, sometimes, the little bread-and-butter issues.

Part of this is communicating to the folks, again. Things are probably going to get worse before they get better, but you want to know that the leader of the country understands that they're getting worse and exactly where they're getting worse.

COOPER: David, let's talk about the banks, because, you know, while a lot of us were focusing on the inauguration, you suddenly look at the Bank of America stock, which was -- I think it had a high this year of, like, $45 or so, it's now down to $5 and change. J.P. Morgan Chase, all these banks which were supposedly the safe banks, suddenly seem to be almost in penny stock territory.

GERGEN: That's -- that's the worry, Anderson. They -- and they do need more capital.

And the question is, where do you get it? You know, the credit markets are really -- it's very hard to raise that money now. With the stock down so much, it's very hard to go to investors and ask them to pour more money into equities or any kind of stock like that.

And, so, the -- the government becomes the case of last resort. Well, the government already has a lot of money into this. But if they have to go and nationalize it -- and what that would mean is, the government would completely run the banks, like Bank of America and Citi -- that's a big, huge step. Other -- other countries have done this, gotten in, and then -- and then sort of de-nationalized.

But, if you nationalize two banks -- as one expert told me today, if you nationalize two of the main banks, how do the other banks compete against a government-owned bank, which is offering money at 1 percent? How does J.P. Morgan Chase compete against that?

It puts a lot of pressure on for the government then to nationalize a number of big banks. And that's very expensive, has its -- has its own perils.

So, when Paul Volcker said yesterday we may be looking at trillions of dollars in government spending, grants, loans, guarantees, there are a lot of people now working up to say, you know, this could get a lot more expensive than we ever thought, and we don't know if it will work. That's the real fear.

COOPER: Let's talk about Guantanamo briefly.

Ed, Republican lawmakers pushing back on the notion of, not just closing down Guantanamo, bringing those detainees to -- to be housed somewhere in the United States, saying, essentially, it's a national security issue. ROLLINS: Well, it's -- listen, there's plenty of places we could house 250 people. There's lots of prisons. There's lots of isolated places.

I think that's -- I think that's a moot issue. This president promised he was going to do it; he did it. He got 9.5 million votes than John McCain, so, he's entitled to do what he said he was going to do. I think it's -- I think it's a red herring. I think there's other issues that are far more significant than shutting that thing down.

COOPER: John, when you hear people say it's a national security issue, do you buy that?

RIDLEY: No, I don't. I you already got an individual like Ramzi Yousef, who is locked in Florence, Colorado. Obviously, we're talking about more people here. But we have gone from 775 prisoners down to about 260-some in the last eight years.

I think, more importantly, as Ed pointed out, Barack Obama is doing something. He's forcing everybody to deal with this issue. So, in a year from now, we will get rid of, hopefully, the rest of these individuals. Let's not pretend they're not bad actors.

But, already, as Bob Gates said today, you have got Europe that's willing to pitch in and try to repatriate or in some way deal with these individuals. And that's what we need now, is international cooperation. This move is helping to do that.

COOPER: We're going to have more from John Ridley, Ed Rollins...

GERGEN: Yes, Anderson?

COOPER: David, yes, go ahead.


GERGEN: I just want to add, briefly, this connects actually to the economic issue.

Barack Obama has been making the point there's a lack of confidence in the country. If he can, by following through on his campaign promises, create confidence in the government, maybe it can make people more confident about the economic future and help get the economic wheels moving again.

COOPER: And confidence is the key to a lot of this.


COOPER: David Gergen, Ed Rollins, John Ridley, we're going to have more from you throughout this hour.

A reminder: David is also blogging for us. You can see his latest post. It's a good one. It's on the economic crisis. It's right now on the Web site, Up next: why Caroline Kennedy took herself out of consideration for Hillary Clinton's old Senate seat -- conflicting reports. We will try to sort the fact from the fiction.

Also, Mrs. Clinton takes charge at the State Department, and the president comes calling.

And, later, more from that remarkable behind-the-scenes photo essay, the Obama Inauguration Day almost as they saw it -- tonight on 360.


COOPER: Big news out of New York tomorrow. That's when the governor will reveal his choice to fill Hillary Clinton's vacant Senate seat.

And we now know it will not be Caroline Kennedy. She abruptly ended her bid just after midnight this morning. And the question reporters have been trying to figure out is, why did she do this, and exactly what happened? Was it her idea or the governor's? There are conflicting reports.

Candy Crowley has all the latest "Raw Politics."



CAROLINE KENNEDY, DAUGHTER OF PRESIDENT JOHN F. KENNEDY: I feel this commitment. This is a time when nobody can afford to sit out.

CROWLEY: ... has turned into January's circus, as Caroline Kennedy makes a messy exit from the pool of people who want Hillary Clinton's Senate seat.

ROBERT ZIMMERMAN, CNN POLITICAL CONTRIBUTOR: The chaos around her withdrawal is consistent with the chaos around the way she pursued her prospective candidacy.

CROWLEY: As late as yesterday afternoon, Caroline, the daughter of Camelot, was said to be asking aides for briefing papers. By early evening, sources revealed she didn't want the Senate seat anymore.

Some close aides and friends were startled. An aide to New York Governor David Paterson, who will make the selection, said he hadn't spoken with her. By late evening, there were reports it was all a misunderstanding, and Kennedy still wanted the job. Shortly after midnight, Caroline Kennedy issued a written statement, pulling out.

ZIMMERMAN: I think her campaign was severely undercut by aides who really were more enablers than they were advisers.

CROWLEY: But the next chapter in bizarro world is nasty. A source close to the New York governor's office suggests Kennedy backed off because of a nanny and tax problem.

"We do know," said the source, "she's mired in some potentially embarrassing issues."

The 51-year-old Kennedy previously denied any nanny or tax problems, but even worse rumors keep New York's political elite abuzz. Trying to silence the speculation, a Kennedy spokesperson said she withdrew for personal reasons and called any our suggestions mudslinging.

Governor Paterson's office backed that up with a statement saying, no information has surfaced to disqualify any candidate, and "speculation to the contrary is both inaccurate and inappropriate."

But it doesn't end. A source close to Paterson says the governor was not going to pick Kennedy anyway, because her debut on the political scene was often naive and incoherent.

QUESTION: Caroline, why did you decide, after decades of very private life, to now go into the public spotlight?

KENNEDY: Well...


KENNEDY: You know, I...

CROWLEY: "Why would he pick her," said the source, "given how badly she handled herself in recent weeks?"

Kennedy's popularity among New Yorkers faded over time, but team Caroline insists there wasn't a hint the governor wasn't going to pick her.

There is one clear thing now. Caroline Kennedy will not step into the U.S. Senate seat once held by her uncle Bobby Kennedy. A New York congresswoman, Kirsten Gillibrand, is said to the current fave. Governor Paterson holds a news conference tomorrow.


COOPER: Candy, you and I were e-mailing a lot about this last night, trying to figure out what was going on.

How did this become such a mess?

CROWLEY: Well, you know, first of all, there's sort of the New York element to this.

And New York politics is combat sport, mixed with Broadway musical. It's just sort of crazy up there.


CROWLEY: And there's also the fact I think Caroline Kennedy, remember, just as she was being raised by her mother, the whole point of the way the mother took them away from the spotlight and made it very private was, she wanted private lives for them. And that's how Caroline has conducted her life.

Suddenly, she was thrown into -- from a very private person into a very public spotlight. It really hurt her, I think, that there weren't people around her. She never -- that really helped her. She didn't seem prepared.

You have the governor's office. He was not well-served, I think, by some of them who are around him. So, you have two communications departments that really, I think, fell short for their principals. But, in the end, you know it's always about the people in charge. And that would be Governor Paterson and Caroline Kennedy, both of whom seemed to have made mistakes that certainly made this a lot more of a circus than it needed to be.

COOPER: And we will be hearing more tomorrow.

Candy, thanks.

Next: Hillary Clinton's first full day as secretary of state. We will show you the reception she received at the State Department and what new message she's sending to the world. That is coming up.

And, later, jetting with the president -- climb aboard Air Force One as Barack Obama meets the crew and orders up some food for the first time.


OBAMA: If you have, like, salad or some vegetables or something.

UNIDENTIFIED MALE: Yes, sir. No fries or anything like that?

OBAMA: Oh, I will still take the fries.






HILLARY RODHAM CLINTON, U.S. SECRETARY OF STATE: There isn't anything that I can get done from the seventh floor or the president can get done from the Oval Office unless we make clear we are all on the American team. We are not any longer going to tolerate the kind of divisiveness that has paralyzed and undermine our ability to get things done for America.


(END VIDEO CLIP) COOPER: Strong words from Secretary of State Hillary Clinton, the nation's chief diplomat now, on her first day at work, taking a shot at the old regime. Secretary Clinton promised to, in her words, use defense, diplomacy and development for America's foreign policy and for its security.

And the work got under way in a hurry, with President Obama on hand to make two big announcements.

Jill Dougherty reports.




JILL DOUGHERTY, CNN FOREIGN AFFAIRS CORRESPONDENT (voice-over): Rock star excitement hits the button-down State Department, as Hillary Clinton starts her first day as secretary, telling staff, America's new smart power policy needs smart people.

CLINTON: I want you to give me the best advice you can. I want you to understand there is nothing that I welcome more than a good debate and the kind of dialogue that will make us better.


DOUGHERTY: Even President Obama showed up to welcome her...

OBAMA: I have given you an early gift, Hillary Clinton.


DOUGHERTY: ... letting his secretary of state announce they're drafting two foreign policy heavyweights, former Senator George Mitchell as special envoy to the Middle East...

GEORGE MITCHELL, SPECIAL ENVOY FOR THE MIDDLE EAST: There's no such thing as a conflict that can't be ended.

DOUGHERTY: ... and Ambassador Richard Holbrooke as special ambassador to Afghanistan and Pakistan. The message was unmistakable: U.S. diplomacy is back.

OBAMA: We can no longer afford drift, and we can no longer afford delay, nor can we cede ground to those who seek destruction.

DOUGHERTY: The president wasted no time diving into the most volatile issues, pointing to what he called a new era of American leadership.

OBAMA: The United States will not torture.

(APPLAUSE) DOUGHERTY: Alongside the president, a snapshot of his foreign policy brain trust, including the vice president, each with strong ideas and big egos.

(on camera): Hillary Clinton has her own strong ideas, and her challenge will be getting them heard by the man who has the last word, President Barack Obama.

Jim Dougherty, CNN, the State Department.


COOPER: Some big names with long resumes in dealing with the world's hot spots were appointed today by President Obama.

Special diplomatic envoy, as you just heard, George Mitchell, the former senator, is going to be tackling the Middle East. Richard Holbrooke will be the special U.S. envoy for Afghanistan and Pakistan.

Joining me again, David Gergen, John Ridley, and Ed Rollins.

Ed, you've got George Mitchell. You've got Richard Holbrooke, Hillary Clinton, a lot of big egos. How does that all balance out?

ROLLINS: Mitchell, no conflicts that can't be resolved. Well, the first conflicts are going to be all right there.

COOPER: Really? You think so?

ROLLINS: David and I lived in a White House that was pretty well divided, and you know, at the end of the day, the president was forced to make decisions because of different viewpoints, and it worked.

Here you've got a lot of talent, but you've got a lot of the world carved up. And you have now two very powerful men. One used to be majority leader of the United States Senate and one basically was the U.N. ambassador and assistant secretary. They have a separate access to the president. The secretary of state is going to have to scramble pretty hard, and the national security adviser, Commandant Jones, is going to have a very tough job being the referee.

COOPER: I want David to be able to weigh in on this. He's worked in White Houses. And also John. But I want to do that after the break.

When we come back, we'll talk more about that and also talk about what hotspots and also talk about what hotspots are going to be on the agenda first. That's going to be the biggest test for the president right away.

And imagine what it's like to fly on Air Force One. A new documentary shows you all the perks, plus what it was like the day Obama was first welcomed on board, shortly before taking office.

And then, fresh pictures tonight from that harrowing landing in the Hudson River last week of U.S. Airways Flight 1549. (COMMERCIAL BREAK)


BARACK OBAMA, PRESIDENT OF THE UNITED STATES: The imperatives of our young century demands a new era of American leadership. We must recognize that America's strength comes not just from the might of our arms or the scale of our wealth but from our enduring values.


COOPER: Those values are going to be put to the test in short order by multiple foreign crises, many in perennial hotspots like the Middle East. Let's dig deeper with David Gergen, John Ridley, and Ed Rollins.

David, where do you think priority No. 1 is? I mean, Afghanistan, Iraq, Israel, you've got -- the list goes on and on.

GERGEN: I think -- it is. And I think they're having a very hard time sorting that out. But appointing these two envoys today, I think they made ideal appointments.

George Mitchell has a record of listening closely, finding common ground, helping people mediate what appear to be irreconcilable conflicts, as he did in helping to bring peace in Northern Ireland.

Dick Holbrooke is known as the guy who can knock heads together, very tough and very forceful but can bring peace that way, as he did in Bosnia. So you've got two very different kind of personalities but I think well situated for the tasks at hand.

Mitchell in the Middle East where impartiality is going to be very important, so that the Arab world respects the negotiator from the U.S. Holbrooke in Afghanistan and Pakistan, an issue he's long been concerned about. He's been calling it Afpak, the Afpak problem.

I think these are two strong personalities, but they illustrate that you can't choose one or the other as party (ph). You've got to hit them both quickly. And to do that today, to get Barack Obama to come over to the State Department and have Hillary Clinton embrace the foreign service, which has felt very neglected and marginalized over the last few years.

This gets them off to a strong start. Are the problems almost impossible to fix? Probably so, but they have the best people working on it.

COOPER: John, it's interesting. Obama spoke on the situation on Gaza today, really, for the first time since taking office. He called on Palestinians to halt rocket attacks, for Israelis to complete the pullout of their ground forces. He seems to be kind of keeping in line with his strategy, trying to play things pretty much down the middle.

But in a situation like, you know, Israel and Palestinian situation, is that going to work?

RIDLEY: That's going to be tough to try to play that down the middle and try to get some kind of consensus. I think, for a large part of the Palestinian population, they felt that they have not been listened to. It's one thing to prove that you're listening to individuals, but you've got to get some payback for that. You've seen rocket attacks continue, despite the fact that Israel years ago had moved back from those territories.

So we've got to know that, if we're going to listen to them -- I was going to say appear to listen to them, but we certainly are trying to do, what are they going to do for us. It's not enough to seem as though you're impartial. If you're impartial, what are you getting for your efforts?

COOPER: And where does Joe Biden fit into all of this? I mean, he went on that, you know, whirlwind tour of some of the hot spots. He's certainly got a ton of foreign policy experience.

ROLLINS: He certainly does. He's going to have the toughest role of all, because he's not second in command. He doesn't have a portfolio. What he has is a lot of experience, and when his voice is heard, which means he has to do a lot of listening, but when his voice is heard, he has to be a very important voice and it has to be one that adds something new to the dialogue.

The other part, I think, is the secretary of state who's obviously very, very powerful, has two very powerful players who report to the White House and don't report to her. And say she's got to be very careful of the turf battles. And they've got to somehow work together as a team, and if they can, they'll be a very powerful team. If they can't, they'll create great chaos.

COOPER: David, I mean, do personalities and personality clashes really play such a big role? I mean, if they have different portfolios, Holbrooke and Mitchell, you know, why does it matter that they have big personalities?

GERGEN: Well, because they can get into conflicts. We've seen famous conflicts in the past, often between the State Department, say, and the White House. Al Haig at the State Department under Ronald Reagan had huge conflicts with the White House, and eventually he resigned under a lot of pressure.

Colin Powell, as much as he was admired by the American people, because he embraced the foreign service, there was a sense in the Bush White House that he was not one of them, that he was running a separate government. And they -- you know, they didn't listen to him in the way they should have.

You see this through a variety of administrations. I think Ed Rollins is right. Trying to get the personalities straight is very important. But there is a closeness here: Biden, Hillary Clinton, George Mitchell, and Dick Holbrooke, all of them are close to each other. They all have a lot of respect for each other. Barack Obama is new to this team, but he is bringing them in to be around him. It's a very fascinating thing.

And whether it will work I don't think -- I think, Ed, that Mitchell and Holbrooke are going to have to be reporting into the State Department, too. It won't work otherwise.

ROLLINS: It won't work. I agree with that totally, David. And I think -- I think in fairness that it is important the president has to show the secretary of state -- they have to have a common ground together. And they had some conflict in the course of the campaign. And I think that's a very important -- that may be a great, long weekend at Camp David that they'd come out of there unified, and obviously, here's where we go. Without Bill Clinton.

COOPER: We're going to leave it there. Ed Rollins, David Gergen, John Ridley, good to have you on the program. Thank you very much.

Still a lot to cover tonight. New pictures of the Obamas' private moments. These are really great pictures. Insights into the president and the first lady's relationship from the photographer who took the pictures. Sasha and Malia as the new first daughters and the family's first hours in the White House, all of it captured in a series of photos. That's coming up.

But first, Erica Hill joins us with a "360 Bulletin" -- Erica.

ERICA HILL, CNN ANCHOR: Really incredible pictures there, Anderson.

Also, some new pictures tonight. Equally amazing but in their own way, showing U.S. Airways Flight 1549 moments after its emergency landing in the Hudson River one week ago today.

A camera at a local power company captured this video. Now, you can see at one point an inflatable ramp and raft deploy from the Airbus 320. Passengers are also shown climbing out. Everyone on board, of course, did make it out safely.

That forced landing apparently the result of what is known as a bird strike.

Merrill Jessop, the top member of a polygamist sect in Texas subpoenaed, along the group's spokesman. Jessop was indicted on charges related to underage marriage after a raid last spring on the Texas ranch he oversees.

More than 400 children were removed. They were later returned under a court ruling.

Former Merrill Lynch CEO John Thain is leaving Bank of America just weeks after helping to close the deal combining those two companies. CNBC reporting today he spent more than a million dollars redecorating his office last year at Merrill, Anderson.

COOPER: More than a million dollars just to redecorate one office? HILL: I think in one account -- again, this is from CNBC, an $85,000 rug.

COOPER: I also saw an account that his driver earned more than $200,000 a year. Which is like...

HILL: I think I may be applying for that job. If it's still available.

COOPER: I know. That's amazing. That's incredible.

HILL: It is insane.

COOPER: It just makes you think.

All right. And -- I mean, that's one of the companies, you know, we're bailing out. It's unbelievable.

HILL: Makes you feel good.


Time now for our "Beat 360" winners, our daily challenge to viewers to write a caption for a photo that we put on our blog each day.

Tonight's picture actually taken by producer -- producer Leah Smith -- Leah Smith. CNN's Gary Tuchman with Kanye West, capping off the inauguration at the Youth Ball on Tuesday.

HILL: One of our best pictures ever.

COOPER: That's a very good picture right there.

Chuck is our staff winner tonight. His caption: "Psst, control room. I'm going to need some guidance on what a 'shorty' is."


COOPER: Our viewer winner is Kevin from Toronto. His winning caption: "Tuchman's impromptu magic show falls flat when a dove does not appear out of the hanky placed in Kanye's pocket."


HILL: I like it.

COOPER: It's good, Kevin. Your "Beat 360" T-shirt is on the way. Congratulations.

When we come back, an exclusive look inside the ultimate flying machine. What it was like for Barack Obama when he stepped aboard Air Force One for the very first time.

Also ahead, we'll take you behind the scenes backstage with the Obamas on the biggest day of their lives. A pretty big one for the country, as well. We'll be right back.


COOPER: Cruising the menu aboard what is now Air Force One. The extraordinary image from inside the flying White House, taken the very day Barack Obama boarded the jet for the first time when he was president-elect. What did he order and what did -- what did he say that had everyone laughing? You'll see that in a second.

The video of Mr. Obama inside the 4,000-square-foot cabin is from a National Geographic special. And when he's on the 747, the leader of the free world sounds very much down to earth.

Up close tonight, here's Randi Kaye.


RANDI KAYE, CNN CORRESPONDENT (voice-over): It's as tall as a six-story building and longer than a hockey rink. It's also President Barack Obama's newest means of transportation: Air Force One.

UNIDENTIFIED MALE: Good afternoon. Nice to meet you.

OBAMA: Good to see you. You're a good pilot for Air Force One. You know, I got to say, you're out of central casting. You're exactly what I want the pilot of Air Force One to look like.


OBAMA: You look like you know how to play. You look like Sam Shepherd in "The Right" -- "The Right Stuff."

UNIDENTIFIED MALE: Thank you very much, sir.

KAYE: That's Mr. Obama stepping inside the plane for the first time. He was flying from Chicago to Washington before the inauguration. National Geographic's documentary about Air Force One captured the moment.

PETER SCHNALL, PRODUCER: He was as excited as his staff, who had already boarded the plane, and were sort of like kids in a candy shop in a sense.

KAYE (on camera): The documentary focuses on Air Force One: who and what it takes to move the president around the world. Obama's flight took place in the final days of shooting, so the film crew witnessed the on-board transition, too. Every new president gets a new pilot.


KAYE (voice-over): Colonel Mark Tillman flew President Bush on Air Force One for eight years.

COL. MARK TILLMAN, FORMER AIR FORCE ONE PILOT: He has an ability to run the country from Air Force One. So he has everything that's available in the White House, is available to him at 45,000 feet.

KAYE: Including a gourmet meal, though Obama stuck with the basics.

UNIDENTIFIED MALE: Welcome, sir. Have you had dinner already? This is a menu we have available for you.

OBAMA: I'll see how you guys do a burger. I take it medium well.


OBAMA: And cheddar cheese, if you've got it.

UNIDENTIFIED MALE: Sir, you know I got it.

OBAMA: Cheddar cheese?

UNIDENTIFIED MALE: Cheddar cheese, we have it.

OBAMA: And I'll take Dijon.

UNIDENTIFIED MALE: Dijon or the Grey Poupon?

OBAMA: That's fine. Do you have, like, salad or vegetables.

UNIDENTIFIED MALE: No fries or anything like that?

OBAMA: I'll still take the fries.


KAYE (on camera): Will President Obama be able to exercise on board?

TILLMAN: The president has the capability to exercise on the aircraft if he wants to, watch football games and sporting events. He's big on watching sporting events. He's got that capability.

KAYE: No basketball court, though?

TILLMAN: No basketball court. But he'll have the ability to ride a bike or something. Something small, up in his office, for sure.

KAYE (voice-over): An hour and a half later, when Obama touched down at Andrews Air Force Base, he said his good-byes to the crew, told them he'd see them in a couple of weeks after he was sworn in.

SCHNALL: You could sort of feel this air of awe in him, I think even in him, because he was very quiet as he walked out, and his face kind of got very quiet.

KAYE: A rare moment of peace, perhaps, to soak up the wonder of it all.

Randi Kaye, CNN, New York.


COOPER: Fascinating stuff. Don't you wish you were on a flight that had personal chefs?

"On Board Air Force One" airs this Sunday, January 25, at 8 p.m. Eastern on the National Geographic Channel.

When we come back, some remarkable behind-the-scenes images of the inauguration from a photographer who had an extraordinary access to the Obama family throughout the day. The pictures she took speak volumes. She'll also narrate them herself.

Plus, perhaps they were separated at birth. We'll show you a man who bears an uncanny resemblance to, well, you know who.

And at the top of the hour, Caroline Kennedy takes her name out of consideration for Hillary Clinton's Senate seat. The "Raw Politics" behind her decision, coming up.


COOPER: The inauguration was full of memorable moments, certainly, including some very private moments for the first family. Some of those images are in the current issue of "TIME" magazine.

Photographer Callie Shell-Aurora had extraordinary access to the Obamas on Tuesday. The photographs she took are a rare window into a life-changing and historic day. We asked her to show us the photos and narrate what she experienced herself.


CALLIE SHELL-AURORA, PHOTOGRAPHER: It's a very special day, and it's not just a special day for the president and the first lady coming in but it's a special day for the whole country, especially this one.

I have to say, this is the most personal one because I've actually been with the person from beginning to end, starting this campaign. You know, so, you know, I just think it's an amazing process. I know the staff. There are many of them there that have worked there since Kennedy or near that time, and I know that when I left the White House, you know, the one thing they had said was, "Someday it would be really wonderful to serve a black president."

You go through a practice. You know, he's adjusting his lapel pin, you know, to make sure it looked OK. And not to make sure he looked OK, but you know, it's -- I've got this pin. Make sure that looks good. Make sure I carry it off right. Make sure I don't block the cameras with my hand.

And I just think Michelle the whole time, it was so obvious all day long that she was looking at him with pride. You know, they're very lucky to have these two children that understand the importance of what their father's doing -- means to their generation. Sasha is a skipper and a dancer and a run-arounder. So I think -- she had taken her shoes off, and they just sat down in the chair and fixed the shoe.

But I think having the girls there -- I think it means a lot to kids. They are these real people that -- they really do have this -- Michelle and Barack Obama have an amazing relationship as a couple, as best friends. Their support for each other is amazing. And they are just like every other parent. They're trying to balance work and balance their family.

The only way with a thousand people around you, you know, to go out and make a speech or go through the day is you just kind of close your eyes and pretend like a thousand people aren't around you.


COOPER: Such cool photographs. And remember the beautiful moment from the inaugural? Take a look.




COOPER: Itzhak Perlman, Yo-Yo Ma and company performing, note perfect. Tonight "the New York Times" is reporting why it was so perfect. It turns out it was previously recorded. Kind of pulled an Ashlee Simpson on this. The weather was apparently too cold for the instruments to stay in tune.

HILL: You know what's incredible, though is I have to say, I learned when I was watching the concert on Sunday. I noticed all the musicians were playing black violins or cellos. And "The New York Times" had an article about it the day before the inauguration, saying they're made of carbon because they can withstand the cold. They won't crack. And so they were actually supposed to play them, apparently, on that day so as to not ruin the instruments but decided not to.

COOPER: Well, it's interesting, because Aretha Franklin, who was on "LARRY KING" last night, was talking about how she wasn't happy with her performance because of the cold affected her voice. So apparently, I guess they didn't want to risk it or something. "The New York Times" reporting, in fact, it was prerecorded.

HILL: How about that? It still sounded good, though.


HILL: Not quite the same as Ashlee Simpson.

COOPER: No. They did it much better than Ashlee Simpson. COOPER: Probably don't need as much edit.

COOPER: Yes. Ashlee Simpson, that whole Ashlee Simpson thing, it seems like, what, years ago.

HILL: It does.

COOPER: Yes. Oh, well.

Up next -- and she looks completely different now. Up next, he's not the president, but he plays one on TV. Meet the man who's cashing in on his resemblance to Barack Obama. It's our "Shot of the Day."

And at the top of the hour, serious stuff: the real President Obama strikes at the heart of former President Bush's approach to the war on terror. "Raw Politics" coming up.


COOPER: Time for tonight's "Shot." A very good impression. Take a look at perhaps the best double for President Obama. This guy is from Indonesia. Maybe if you squint your eyes, it looks a little better.

HILL: Better than some I've seen. I'll tell you that.

COOPER: Well, that's true. He's a 34-year-old photographer. We're told he's a huge Obama look-alike star in Asia, making a good living at it, no doubt. Look at this. Our Obama impersonator is starring in the commercial in the Philippines. It's for some sort of antacid. He also was reportedly on an Indonesian TV show during Mr. Obama's inauguration.

HILL: You would need an antacid if you were the president or even playing one on TV.

COOPER: That is certainly true.

I also just want to take a moment to point out something that we have all been talking about here a lot today. Today is the last day for two people, very important people on our staff: Brittany Harris (ph), a producer here, long-time producer. A long time, a couple years. She -- she's risen quickly, and she's a remarkably young woman. And she's going off to London.

And Jenny Blanco (ph), who's a line producer here, who is truly extraordinary, is going off to another company to pursue an opportunity. But we hope both of them come back, eventually finding their way back to us.

HILL: Yes.

COOPER: They're truly remarkable talents.

HILL: Yes. We will miss them dearly. COOPER: We certainly will. Both personally and professionally, they are truly great. So you can see, of course, all the most recent shots on our Web site:

Coming up at the top of the hour, President Obama's pressure cooker. The economy apparently getting worse, his choices getting tougher. Later, trying to solve the riddle of Caroline Kennedy's abrupt loss of ambition to be senator. Tonight on 360.