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Obama set to announce another position in his administration; Israel halts military assault for humanitarian efforts; Controversy still surrounds Burris

Aired January 07, 2009 - 09:00   ET

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

HEIDI COLLINS, CNN ANCHOR: Stopped at the Senate doors. Today an appointee for Barack Obama's seat could find a warmer welcome.
Plus, holding fire. Israel takes its finger off the trigger to let Gazans get aid.

It is Wednesday, January 7th. I'm Heidi Collins. And you are in the CNN NEWSROOM.

Guarding your money. Next hour, President-elect Barack Obama will announce a new watchdog to oversee government spending. The goal of the new position? Stop wasting taxpayer dollars.

CNN White House correspondent, Elaine Quijano, is joining us now with more details of this.

Yes, the chief performance officer. Correct?

ELAINE QUIJANO, CNN WHITE HOUSE CORRESPONDENT: That's right. And President-elect Barack Obama is set to name Nancy Killefer to that position, according to two Democratic officials.

Killefer is currently director of a management consulting firm here in Washington, called McKenzie & Co. She's also a former assistant secretary of the Treasury in the Clinton administration.

Again, her job is going to be basically finding government efficiencies, so that announcement set to come at a news conference later this morning.

In the meantime, here at the White House, officials are gearing up for an historic meeting. It will be the first time since 1981, officials say, that they will have had a gathering of this kind.

It will include the living past presidents, as well as the current president and president-elect, all meeting, we understand -- because of the rain, they'll be meeting inside for the photo-op that was scheduled originally for the Rose Garden. Now will take place in the oval office.

We should mention that beforehand, the president, President Bush, and President-elect Obama, will have a chance to sit down one-on-one in the oval office for a discussion. And then they will be joined by the former presidents in the oval office. They'll move on to have lunch, we're told after that. Now, no word on what topics they might discuss in terms of policy. But Dana Perino, White House press secretary, told reporters yesterday that they'll likely discuss some personal reflections of their time inside the White House, including what it is like to raise children in the White House -- Heidi?

COLLINS: Well, it is interesting, Elaine. Given the timing of all this, just a few days away, of course, from the inauguration and a new president coming in.

QUIJANO: Well, that's right. We should note that this was a meeting that was suggested by President-elect Obama. We're told that President Bush readily agreed. But we talked to a political analyst about this, and they say, look, this is a very savvy move on the part of Barack Obama.

He, after all, was a president-elect who is a president-elect who ran on a platform of change, trying to appear as though he wants to transcend the tone in Washington. And so by having these former presidents come here to the White House, meet with him and the current president, men who have different ideologies, this certainly is intended to be a very symbolic meeting as well in addition to being historic -- Heidi?

COLLINS: All right, well, we will be watching.

Thanks so much, Elaine Quijano, sure do appreciate that.

QUIJANO: Sure.

COLLINS: And also I want to give you a little bit more now, a closer look at Nancy Killefer, President-elect Obama's choice of the new position of chief performance officer. She is currently a senior director at a Washington management firm.

And from 1997 to 2000 Killefer worked as assistant director of management at the Treasury Department. After leaving Treasury, she served five years on the oversight board at the IRS.

And a reminder President-elect Obama is scheduled to announce his chief performance officer next hour. We're going to carry that live for you. That announcement now scheduled for 10:15 Eastern, 7:15 Pacific.

Roland Burris heading back to Capitol Hill next hour and likely to get a much warmer welcome than yesterday.

Amid a media circus, you saw it here on the CNN NEWSROOM, he was publicly denied Barack Obama's Senate seat because of the disgraced governor who appointed him. Now it appears that support for Burris may have shifted in his favor.

Congressional correspondent Brianna Keilar joining us now to explain more on this.

Brianna, we thought that this could be a potential outcome of what we saw yesterday.

BRIANNA KEILAR, CNN CORRESPONDENT: Well, there is a lot of pressure, not only from the big spectacle yesterday, but from a growing number of Democrats here on Capitol Hill who disagree with Senate Democratic leaders in their decision to block Burris.

Here in just a few minutes Burris is expected to be meeting with the top two Democrats in the Senate and, again, they're facing mounting pressure. Most recently from California Senator Dianne Feinstein.

This is significant -- because she is the outgoing chairwoman of the Senate Rules Committee. This is a committee that is factored into the Democrat leaders' options for delaying Burris' appointment.

They'd actually talked about launching an investigation through the rules committee, to -- to delay the seating of Burris until basically Illinois governor, Rod Blagojevich, could be ousted and his successor could appoint someone.

We've also heard from Congressman Bobby Rush yesterday. He called this block a racist action. We heard from Congressman Jesse Jackson Jr. from Illinois as well who had actually thrown his hat into the ring for this seat, and he said that as this becomes increasingly racialized, the chances of hanging on to this seat in 2010 are not good.

So, mounting pressure, including from the NAACP.

At the same time, I spoke with the spokesman for Senate majority leader, Harry Reid. He said Reid is not feeling any pressure, but we do know from a senior Democratic source familiar with deliberations of the leaders, that they're talking about a possible compromise, Heidi, where Roland Burris may be seated as long as he doesn't run for the seat in 2010.

Some concerns he wouldn't be able to hang on to it. And at this point, though, Heidi, Reid and Burris have both said, they're not really happy with that idea. It just goes to show you that there is some perhaps middle ground they could find.

We're going to wait and see, of course, very anxiously, what comes out of this meeting.

COLLINS: All right, absolutely. Brianna Keilar, sure do appreciate that from Capitol Hill this morning.

And just a reminder, of course, Burris is new to the national spotlight, but he's been involved in state politics for a pretty long time.

What do Illinois voters think of Roland Burris? We're going to talk about that coming up later this hour.

A decision may be near on the possible impeachment of Illinois governor, Rod Blagojevich. A committee of state lawmakers back to work today reviewing the case and could soon come out with a recommendation. That means a full House could vote on impeachment by Friday or perhaps over the weekend.

Mixed results in the overseas markets today. In Asian trading, Japan's Nikkei was up for the seventh straight day. India's SENSEX stock index fell more than 7 percent, and the reason for that the chairman of a major computer company admitted to falsifying the company's profits for years.

At last check European trading is down. Markets in negative territory in Great Britain, Germany, and France.

The recession, layoffs, rising unemployment, news in this morning, retailer Goody's going into liquidation. Ethan Allen cutting 350 jobs. These scary times have many of us wondering how safe our own jobs and whether we should change careers.

Here to show us some of the best options is CNN's chief business correspondent, Ali Velshi.

Hey there, Ali.

ALI VELSHI, CNN SENIOR BUSINESS CORRESPONDENT: Good morning, Heidi. I -- you know we're two days away from the December unemployment report. It always comes out at the beginning of the following month. So we're expecting to -- have seen very heavy job losses in December. We'll probably get somewhere close to 2.5 million jobs lost in 2008.

So this is -- this Web site called Career Cast, it's partially owned by "The Wall Street Journal," and they have ranked 200 jobs in terms of, you know, what -- why they think these are good jobs or not.

And I'll show how they've ranked them. They've ranked them by the work environment, the income, the employment outlook, how easy it is to get a job and how easy it is to move up in that job, the stress level and the physical demands.

This is an interesting list. Look at the top five of the 200. I was a little surprised. Math -- mathematician, I can't even say it, actuary, statistician, biologist and software engineer.

COLLINS: OK.

VELSHI: Yes. I mean...

COLLINS: Well...

VELSHI: That's kind -- that's some serious -- I mean that's just serious work.

COLLINS: Yes, it is a lot of work.

VELSHI: But I guess there's not a lot of physical demands, I -- guess, if you know all...

COLLINS: Well, I mean, I think there's probably a lot of stress, especially when you're talking about an actuary.

VELSHI: Well, it's stressful to me because I don't know how to do it, but I imagine you're an actuary it's, you know...

COLLINS: You probably got the training.

VELSHI: Yes.

COLLINS: Hey, what about author? Like book author?

VELSHI: Yes...

COLLINS: Why isn't that up there?

VELSHI: Well, I don't know. I'll tell you what the worst is, I'll tell you what the worst is. 190 -- the bottom five, 196, EMT, then seaman.

COLLINS: Really?

VELSHI: Taxi driver, dairy farmer, which, you know, it's a lot of early mornings, and lumberjack. 200, number 200 on the list is being a lumberjack. I would think if you were a lumberjack, you'd be into that. Like, you're out.

COLLINS: Yes, sure.

VELSHI: Strong.

COLLINS: Yes, I -- don't know. I mean do they really look at every single solitary industry that's out there?

VELSHI: I don't know how...

COLLINS: That would be impossible.

VELSHI: Well, they got 200 jobs. And it was a real study but, you know, and a lot of this is -- clearly, if you want to be a mathematician, or you're inclined that way, you might be there. But it's not like you've got -- it's not like you're going to go from being a mathematician...

COLLINS: What about a mathematician lumberjack? No, anyway.

VELSHI: Then you're safe. You've got it all covered.

(LAUGHTER)

COLLINS: The book. Let's talk about the book.

VELSHI: OK.

COLLINS: Back to this being an author kind of thing.

VELSHI: Yes, I was looking for author. I couldn't find it.

COLLINS: Yes. Really? See, that's what I'm saying. In all seriousness, though, you -- you did write this book.

VELSHI: Yes.

COLLINS: It's right there on the screen, "Gimme My Money Back." A lot of people are probably saying that right now.

VELSHI: Right.

COLLINS: We -- talked yesterday, Ali, about throwing these words off of our times, you know, billions and trillions...

VELSHI: Yes. Right.

COLLINS: ... and it's gotten, you know, really crazy. When you look at your own personal financing, you were able in this book to be, you know, pretty optimistic about some things.

VELSHI: Yes. Sure, I am, because I think that if -- if we just follow a few rules and not be frightened of it, we can get ourselves back into a position where you can set yourself up for a future where your money is going to grow.

Now look, you can't do anything about home prices. That's not something within your own purview of control. You can't do a lot about your job. You can try and be positioned well, but bottom line is when these cuts come, they come.

You can control your investments, your 401k, your IRA, so many -- more than half of Americans have them, but they really don't do much with them because it's tough to understand.

Now I've extracted a piece of the book and I've put it on CNN.com. If you go to CNN.com/Living, you can take this risk test. In fact, just click on the little link there and it'll -- it'll take you to this test. And you run through seven simple questions.

That's me running through it right now. And they're very simple, your age, how long you think you have until retirement, and then a few questions about how you would feel about market movements.

And it's right out of the book. And I'll just give you an example of them. You know, question four is what -- what would -- assuming normal market conditions, what would you expect your investments to do? Would you expect them to keep pace with the stock market?

COLLINS: Right.

VELSHI: Would you expect them to be -- to lose money? How would you sleep if these things happen?

At the end of the seven questions, it will give you a pie chart and there are five different pie charts depending on your risk level, and you can really go right to the -- the computer and adjust your 401k or your IRA so that at least it reflects what your risk tolerance is. So you can go to sleep at night knowing that, at least, you're invested according to what type of investor you are.

COLLINS: Absolutely. And you know, that's one of the things to keep in mind throughout all of this is -- we are individuals.

VELSHI: That's right.

COLLINS: And everybody handles the amount of stress and the amount risk taking...

VELSHI: Right.

COLLINS: ... very, very differently.

VELSHI: Yes. It's not a one-size-fits-all situation. And this -- this will allow you to go in and personalized your investment portfolio.

COLLINS: All right. Very cool. Ali, sure do appreciate that.

VELSHI: Absolutely.

COLLINS: "Gimme My Money Back." Love the title. Thank you.

VELSHI: (INAUDIBLE), Heidi.

COLLINS: You, too.

A humanitarian truce in Gaza for three hours every other day. The first one ended just moments ago. Israel offered to suspend its military actions so people could get much-needed supplies.

Moments ago a government spokesman told CNN Israel welcomes a truce plan by Egypt and France and will keep talking with both countries about how to achieve a cease-fire.

This is the 12th day now of Israel's campaign aimed at Hamas militants.

In dispute today, Israel's shelling of a school turned shelter in northern Gaza just yesterday. At least 40 people were killed. Israeli commanders say militants were firing mortars from a school, but U.N. officials say they are, quote, "99.9 percent certain there were no militants at the school at the time."

Throughout this Palestinian territory, people are in desperate need of food, water, and medicines.

CNN's Paula Hancocks is joining us from now the Israel-Gaza border.

So, Paula, tell us a little bit more about how today's temporary truce went?

PAULA HANCOCKS, CNN CORRESPONDENT: Well, Heidi, the first thing to mention is that we still heard some explosions during that truce. It was certainly a lot quieter than we've seen in some time.

But it was -- it was a lull of types, and certainly it would have given three hours to those in Gaza to be able to get out and try and buy food and water. But the fact is, there is hardly any food in Gaza. There are huge, huge queues outside bakeries just to get the basic breads.

And, of course, there are -- there's hardly any fuel in Gaza either, so the aid agencies are saying three hours is fair enough. It's a first step. But if you can do three hours, why not do 24 hours?

And the United Nations agency in Gaza, UNRA, was saying that three hours quite, quite simply wasn't enough, because by the time the trucks got into Gaza, by the time they mobilized their people, who had been hiding in their homes, to get down to the crossing and then trying to distribute food to three-quarters of a million people, three hours was really not enough to -- to even -- just a drop in the ocean, really, for the sort of food, water and medical supplies that people need.

So certainly it has been cautiously welcomed. But the fact is it is not enough. And we are hearing about this Cairo peace initiative that was announced last night, that Israel welcomes it. We understand from the Israeli Foreign Ministry that they'll be sending people to Cairo to discuss the terms, maybe even tomorrow.

But it's really just guidelines at this point. We're hearing from the Israeli foreign ministry that it would be a truce between Hamas and Israel, and there would be some kind of apparatus in place to stop Hamas rearming.

But beyond that, there really aren't many details -- Heidi?

COLLINS: Yes, you have the whole issue of the tunnels, of course, as well, that has yet to be addressed.

All right, CNN's Paula Hancocks from the border there. Sure do appreciate that, Paula.

Meanwhile now, a U.S. Senate race still in dispute. In Minnesota, Democratic challenger Al Franken holds a narrow lead in a final recount. We're going to talk with the secretary of state.

ANNOUNCER: CNN NEWSROOM brought to you by...

(COMMERCIAL BREAK)

ANNOUNCER: You're watching CNN NEWSROOM on CNN, the most trusted name in news.

COLLINS: Al Franken or Norm Coleman? After weeks of recounting votes in Minnesota's U.S. Senate race, state election officials say Democratic challenger, Franken, holds a 225-vote lead. But incumbent Republican Coleman has filed a lawsuit now challenging those results.

Joining us from Minneapolis today, Minnesota's secretary of state, Mark Ritchie, who is a Democrat.

Mr. Secretary, yesterday there was a press conference held by Norm Coleman. It was right after he rejected that ruling by the state canvassing board, declaring Franken the winner.

Listen here for just a moment.

(BEGIN VIDEO CLIP)

SEN. NORM COLEMAN (R), MINN. SENATE CANDIDATE: Whoever wins this race needs to have -- needs to have the trust of the people that that votes were counted fairly, that -- votes were not counted twice. That absentee ballots were looked at fairly and uniformly.

So I think in the interests of having somebody serve with the credibility and the consent of the governed, I think we have to get this right.

(END VIDEO CLIP)

COLLINS: Do you feel like Minnesota has gotten this right? I mean, were there votes that were included and some that were excluded?

MARK RITCHIE (D), SECRETARY OF STATE: Oh, I think the recount was the most accurate, humanly possible. And the purpose of the recount is to really determine how the Minnesotan's voted, but a contest is often to make sure that the losing candidate really does feel at peace in their heart that they did their best, but they came up short.

And so this is a very important part of our entire process here in Minnesota.

COLLINS: Well, there are attorneys, as I'm sure you're well aware, for Senator Norm Coleman who are accusing your office of sympathizing with Franken. You are a Democrat. Is there any truth to that?

RITCHIE: No. But I'm also a Georgian, born in Georgia. I'm a Minnesotan, I live in Minnesota. I'm a public servant, as were my other members of the state canvassing board. Strong Republicans. Strong independents. Nonpartisan people.

I think the people of Minnesota feel this was a very, very public and transparent and accurate process. And we feel great that our system itself gives us the opportunity to really get an accurate final count of how the Minnesotans voted on November 4th.

COLLINS: Well, then, what is Norm Coleman doing? I mean, do you think he's just making this all up? I mean, there's a lawsuit that's being filed and now this three-judge panel, of course, is going to have to decide.

You have to wonder if -- and, again, I don't want to put words in your mouth, but if this is just completely ridiculous and this has been very accurately counted, according to you, then how much is it really going to cost taxpayers in Minnesota?

RITCHIE: Oh, it doesn't cost the taxpayers. It costs the -- candidate. But, of course, this is about the attorneys. And so, you know, I don't have anything to say on behalf of the attorneys.

But a contest is really so the loser can feel comfort and understanding about the process, so we are very supportive. That's why this is actually part of Minnesota law. This is another critical component of how we, in the end, in very close elections, really settle these out here in our state.

COLLINS: Well -- what conversations, then, have you had with Governor Tim Pawlenty, who, we should say, is a Republican, on this? He said that he's not signing anything, he's going to hold off until, quote, "the battle is done"?

RITCHIE: Well, it's really not his decision and it's not my decision. Our law is very precise.

COLLINS: Yes, but the two of you have to sign that certificate.

RITCHIE: Oh, yes, but this is a ministerial function. When the contest is over, the certificate is issued. He signs it, I co-sign it. But it's really not a decision of his or mine.

This is the law of the state of Minnesota. It's very precise in this matter.

COLLINS: All right, well, we will continue to follow it and see what happens next. Again, that lawsuit just been filed by incumbent Norm Coleman, so we'll keep our eye on Minnesota as many people across the country are doing.

Secretary of State from Minnesota, Mark Ritchie, thank you.

RITCHIE: Thank you, Heidi.

COLLINS: Well, we are in for some stormy weather today. A wintry mix of rain, ice and snow causing some major problems across the country.

(COMMERCIAL BREAK)

ANNOUNCER: You're watching CNN, your severe weather headquarters.

COLLINS: Take you over to Rob Marciano now to talk a little bit more about all of this weather that is hitting different parts of the country. We're talking about, what, cold and rain and yuck in the northeast.

(WEATHER REPORT)

COLLINS: Oh, yuck. It all looks pretty darn nasty.

All right, Rob, we'll check back a little later on. MARCIANO: You bet.

COLLINS: Make it better, will you?

MARCIANO: I'll try.

COLLINS: The White House and government watchdogs. We'll tell you why the Bush administration is blamed for losing billions of dollars of your money.

(COMMERCIAL BREAK)

COLLINS: President-elect Barack Obama working out an economic stimulus plan and today Wall Street has new evidence of why drastic measures are needed.

Susan Lisovicz is at the New York Stock Exchange with details on this and the opening bell.

Hey, Susan.

SUSAN LISOVICZ, CNN CORRESPONDENT: Perfect timing, Heidi. Nervousness about the job market has been high, with good reason. Stocks headed for a lower open as a result.

A private forecast from payroll's firm ADP out this morning estimates that job losses last month totaled nearly 700,000. Far higher than most other private outlooks.

The government report on December. Unemployment, meanwhile, comes out Friday. That is a more inclusive jobs report. And there are more cuts to come.

Alcoa, the world's third largest aluminum producer is cutting more than 13,000 jobs or about 13 percent of its global workforce. Alcoa is also freezing hiring and salaries.

Furniture company Ethan Allen is closing a Pennsylvania manufacturing plant and several retail stores. The result? 350 job cuts. If Friday's jobs report does show more losses, Heidi, which is almost a certainty, it will mean a perfect sweep with job losses for every month of 2008. And, of course, job losses certainly make it tougher for retailers.

Goody's family clothing is liquidating its operations. It's the first high-profile retailer in the U.S. to go under in a new year. That is expected to see more going-out-of-business announcements. Goody's, you probably know this store, Heidi. It operates nearly 300 stores in the southeast, has about 10,000 employees.

In the meantime what we're seeing in the first minute of trading triple-digit losses. The Dow right now down 149 points or 1.3 percent. Alcoa shares are down 10 percent. Obviously, that is one of the Dow 30.

The Nasdaq composite, meanwhile, is down 30 points or nearly two percent. And Time Warner shares are down 6.25 percent. That is CNN's parent company. This morning it says it will post a net loss for 2008. Time Warner revising its forecast for a number of reasons, including an economic environment that has proven more challenging than expected. And you want to know the -- you want to know the share price of Time Warner?

COLLINS: I don't know.

LISOVICZ: Heidi --

COLLINS: I don't know. All right, give it to me.

LISOVICZ: Right now, $10, which is actually not its 52-week low. That was $7.

COLLINS: OK. Well, hey, that's better, then. I'm glad.

LISOVICZ: OK, we have miles to go before we retire, Heidi. Miles to go.

COLLINS: Yes, boy, that's for sure. All right, Susan, sure do appreciate it.

LISOVICZ: See you later.

COLLINS: Thank you.

And this note as well, Treasury Secretary Hank Paulson, is scheduled to talk about the housing market in Washington a little bit later this morning. Mr. Paulson will address members of the Economic Club of Washington on how the government can help with housing recovery efforts.

A parting shot to the Bush administration. House Democrats say the White House has ignored thousands of recommendations from government watchdogs. The cost to you, the taxpayer, they say, billions of dollars. CNN's Joe Johns has the story.

(BEGIN VIDEOTAPE)

JOE JOHNS, CNN CORRESPONDENT (voice-over): From the last Congress, a final kick in the pants for the Bush administration. A report prepared by the Democratic staff of the House Committee on Oversight says that since 2001, the Bush administration has failed to implement more than 13,800 recommendations made by inspectors general, the watchdogs of various federal agencies, costing taxpayers almost $26 billion.

REP. HENRY WAXMAN (D), CALIFORNIA: When you have thousands of recommendations that can add up to billions of dollars, it seems to me they ought to be taken seriously.

JOHNS (on camera): Keeping them honest, what it means is that the government never went after billions of dollars of your money, that somebody else got, somebody who probably wasn't supposed to get it. (voice-over): The report says that $2 billion could have been saved just by cutting off social security disability benefit payments to people who were able to work. Then there's the $837 million in overpayments that the Pentagon handed out for military telecom contracts. And don't forget Hurricane Katrina, the report cites $16 million in questionable costs for a single base camp.

SEN. CLAIRE MCCASKILL (D), MISSOURI: You have $16 million here, $100 million here, $300 million there. Pretty soon you've got billions and billions of dollars that we could be saving.

JOHNS: The White House attacked the report as a hyper-partisan hatchet job telling CNN literally in the last minutes of the 110th Congress, it appears the partisan democratic staff has dumped out an incomplete report, whose facts, the White House says, aren't exactly factual. A top Republican on the House Oversight Committee said that while the report looked to him like one more attempt to pile on George W. Bush, it still raises serious accountability question.

REP. DARRELL ISSA (R), CALIFORNIA: It's a party shot. It's popular to kick somebody on their way out the door, but I'm going to take it along with Chairman Towns that there are 13,000 issues that we're going to follow.

JOHNS: Not entirely by accident, Senator Claire McCaskill, a former state auditor, is calling on the incoming Obama administration to beef up inspections for inspectors general.

Joe Johns, CNN, Washington.

(END VIDEOTAPE)

COLLINS: A promise of a temporary humanitarian truce. The Israeli military halted military operations in Gaza for three hours today. The truce began at 6:00 a.m. Eastern, ending just about a half an hour ago.

Israeli military officials say the lull is to allow in humanitarian aid and supplies. And, they say, the cease-fire will happen every other day. Palestinian medical sources say more than 600 people, including at least 100 women and children, have been killed in Gaza since the campaign began 12 days ago. IDF says 7 Israeli soldiers and 3 civilians have been killed.

As civilians try to get out of Gaza, these men and women try to rush in. They are the aid workers, ambulance drivers and doctors who may be the last hope for wounded civilians. CNN's Karl Penhaul has their story.

(BEGIN VIDEOTAPE)

KARL PENHAUL, CNN VIDEO CORRESPONDENT (voice-over): By night, by day, around the clock Israeli strikes on targets inside Gaza. At the Rafah border crossing with Egypt, the aftermath. Ambulance drivers say this young man had his left leg blown away by an Israeli bomb.

DR. AHMED ABD'IL QUAJEB: Look at the shot, civilians, children, women.

PENHAUL: The beep of the ventilator marks time slipping away for 10-year-old Husseina Fahn (ph) without treatment for head trauma, doctors say he could die. His face is pockmarked by shrapnel from an explosion.

(on camera): In the last few moments, there's been a flurry of activity with Palestinian ambulances arriving. The drivers say that some of the wounded appear to be young boys were hit when they were praying in a mosque that was bombed by an Israeli airplane.

(voice-over): There's no way to verify that. The Israeli military says it has targeted mosques it believes are being used as rocket sites and ammunition stores during its air campaign. The circumstances may be murky, but this teenager's pain is clear.

In another ambulance, this Palestinian man watches over his wife. "She has a wound in her leg, and it's very serious because she suffers from diabetes," he says. The Palestinian ambulance drivers may be risking their own lives, too, to save others.

The Palestinian Red Crescent says five ambulances have been hit by the Israeli military in the last 11 days. At least six paramedics and patients died.

"They hit an ambulance this morning, they hit another one yesterday, and the day before, they hit two ambulances," he says. A spokesman for the Israeli defense forces said he was not aware of ambulances being hit by Israeli fire.

The international committee of the Red Cross has warned both sides to respect medics and ambulances. Violating those rules of the Geneva conventions could constitute war crimes. Volunteer truck drivers readying to transport vital medical aid from Egypt into Gaza say they've been harassed, too. They say they fear crossing Israeli tank lines a few kilometers north of here en route to Gaza city.

"You cannot stop because if you stop, they shoot at you," he says. There are so many stories about the casualties here at the Rafah border crossing. But relatives have no time to tell them. Against daunting odds, they're racing to save the lives of loved ones. Karl Penhaul, CNN, at the Rafah border crossing, Egypt.

(END VIDEOTAPE)

COLLINS: $136 billion, that's how much Defense Secretary Robert Gates says it will cost to continue the wars in Iraq and Afghanistan this year. Mr. Gates tells lawmakers the Pentagon will need another $70 billion to add to $66 billion that was approved last year. This estimate also covers some of the costs from the global war on terror. But Gates says these estimates are his personal assessments. They do not reflect the position of the Bush administration or President-elect Obama's transition team.

Freezing temperatures across Europe. Not quite as chilly as relations between Russia and Ukraine right now. Their gas dispute putting the rest of Europe in a tough spot.

CNN's senior international correspondent, Matthew Chance, is joining us live now from Moscow this morning with more.

Matthew, good morning to you.

MATTHEW CHANCE, CNN SENIOR INTERNATIONAL CORRESPONDENT: Good morning to you, Heidi. Europe really paying the freezing price of over reliance on gas from Russia. There's been a dispute, of course, between Russia and the neighboring country of Ukraine over what price Ukraine should pay for its gas deliveries. That's resulted in Russia cutting off its gas to Ukraine.

The trouble is is that many of the pipelines that supply Ukraine carry on towards the west and actually supply Western Europe with their natural gas as well.

Now, it's all come in the middle of a freezing snap, as you say, one of the coldest winters in Europe for some years now. And that's put additional pressure on demand for gas, for heating, for cooking, and, of many countries now, up to a dozen countries in the European Union, are now no longer receiving their gas from Russia, and that's having a huge impact on them.

Who's to blame? Well, both Russia and Ukraine are blaming each other. The two sides, amazingly, after what more than a week of the dispute now, more than a week of cutoffs, are still not talking to each other about the possibility of a negotiated settlement.

Heidi --

And so, Matthew, what exactly is happening to the people where it's so cold?

CHANCE: Well, I mean, it depends on which country those people live in. In some of the more developed European countries like Britain, like France, like Germany, there are big strategic reserves of natural gas. They said they are not suffering at all at the moment.

But in other countries further to the east, the more new members of the European Union, countries like Bulgaria, for instance, have only got a few days of gas supplies left. And even now, thousands of people in those countries -- Bulgaria, Bosnia-Herzegovina, Croatia, other countries like that are suffering very severely now and have already seen their heating supplies, their cooking gas cut off already, and things could get much worse.

COLLINS: All right. Well, we know that you'll stay on top of that story for us.

Boy, Matthew Chance, coming to us live from Moscow this morning. Thank you, Matthew.

He's trying to produce a script in a city of political theater, but Barack Obama is having a tricky time with some supporting characters.

(COMMERCIAL BREAK)

COLLINS: Well, Washington loves a soap opera, but for a president-elect intent on setting its agenda, the many dramas can often get in the way. Here now, CNN's Candy Crowley.

(BEGIN VIDEOTAPE)

CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT (voice-over): A circus surrounding his old Senate seat, a finger-pointing front-page story, and a bit of a rebuke from his vice president, just another no- drama Obama day, relatively minor problems he created and major ones that come to him.

There's the Middle East, and there's a stimulus plan he needs to sell a Congress that is controlled by Democrats, who will not be controlled by Barack Obama, who says he will not allow members to attach pet projects, known as earmarks, to his still-gauzy proposal. Still, the definition seems squishy.

BARACK OBAMA, PRESIDENT-ELECT OF THE UNITED STATES: And I describe earmarks as the process by which individual members insert pet projects without review. So, what I'm saying is, we're not having earmarks in the recovery package, period.

CROWLEY: Obama made his remarks during a meeting with economic advisers, where he also found himself defending a CIA chief he hasn't announced.

OBAMA: I have the utmost respect for Leon Panetta. I think that he is one of the finest public servants that we have. He brings extraordinary management skills, great political savvy, an impeccable record of integrity.

CROWLEY: Senator Dianne Feinstein, incoming chairman of the Select Committee on Intelligence, thinks someone from the intelligence community should run the CIA. And it didn't help that she found out about Obama's pick in "The New York Times." Bad form.

On Capitol Hill, for Senate swearing-in ceremonies, even Obama's vice president-elect couldn't defend it.

VOICE OF JOSEPH BIDEN, VICE PRESIDENT-ELECT OF THE UNITED STATES: I think it's always good to talk to -- to talk to the -- the requisite members of Congress. I think it was just a mistake.

UNIDENTIFIED MALE: So, why didn't -- why didn't that happen?

BIDEN: I think it was just a mistake.

CROWLEY: Feinstein says Obama has since apologized profusely. There is also lingering blowback over the withdrawal of Bill Richardson as Commerce secretary, a spat over who overlooked the seriousness of a federal probe into a Richardson donor.

And there is this three-ring circus around Obama's old Senate seat.

UNIDENTIFIED REPORTER: Sir, what is your expectation? What is your expectation, sir?

CROWLEY: Roland Burris showed up Tuesday to sit at Obama's desk...

UNIDENTIFIED MALE: Here, let me hold it over him.

CROWLEY: ...and found himself standing in the rain.

ROLAND BURRIS, ILLINOIS SENATE APPOINTEE: I presented my credentials to the secretary of the Senate, and advised that my credentials were not in order and I would not be accepted, and I will not be seated.

CROWLEY: Many Democrats, including Obama, don't think Burris should be seated, because he was picked by Illinois Governor Rod Blagojevich, accused of trying to sell the Senate slot.

Late in the day, Dianne Feinstein, outgoing chairman of the Rules Committee, said Burris should be sworn in.

No-drama Obama is finding he can't always write the play in a city that thrives on political theater.

Candy Crowley, CNN, Washington.

(END VIDEOTAPE)

COLLINS: And a reminder now, President-elect Obama is introducing his pick for Government Efficiency Chief. We're going to have that announcement about 20 minutes from now. We'll carry it live for you.

Senate Democrats are looking for ways to defuse the Roland Burris saga. He meets with top Senate leaders today about filling Obama's Senate seat. Meanwhile CNN's Susan Roesgen looks at Burris' reputation among Illinois voters.

(BEGIN VIDEOTAPE)

BURRIS: I am the magic man.

SUSAN ROESGEN, CNN GENERAL ASSIGNMENT CORRESPONDENT: Magic man maybe, but Roland Burris is seen as both an opportunist and a victim snubbed by the U.S. Senate.

Before Mr. Burris went to Washington, Illinois voters knew him as a politician from a different age. He broke the race barrier in the state when he became the comptroller in 1978. Since then, he's been Illinois attorney general and he's been defeated once in a race for Chicago mayor and three times for governor.

KATHY CHANEY, REPORTER, "CHICAGO DEFENDER": I'm part of the younger generation and I know that there are more younger, you know, candidates that are capable, as well as Burris, to handle the job.

ROESGEN: Kathy Chaney, a reporter for Chicago's oldest black newspaper, also says she might have voted for Burris as a senator, but she doesn't like feeling that he wants to be a senator at any price.

CHANEY: I just think that the timing was wrong. I just don't agree with him, you know, stepping up saying OK, yes, I'll take it right now.

ROESGEN: "Chicago Tribune" columnist, John Kass, says he's not surprised by the Burris saga and you shouldn't be either.

JOHN KASS, "CHICAGO TRIBUNE": Well, this is Chicago politics, OK? So get used to it, because this is how it's going to be.

ROESGEN: Kass sees the Burris appointment as just one more in a long line of crafty moves. It keeps a Democrat in the seat and it lets Governor Rod Blagojevich get some support that might help him stay in office.

KASS: You're going to start seeing Rod Blagojevich -- I would assume within a day or two -- leading gospel choirs singing let my people go.

ROESGEN: That is Chicago politics, where anything is possible.

Susan Roesgen, CNN, Chicago.

(END VIDEOTAPE)

COLLINS: A wintry weather mix -- rain, snow, sleet, and ice. What will it be like where you are? We'll tell you in a moment.

(COMMERCIAL BREAK)

COLLINS: Boy, a new round of weather headache to deal with today. Rain in the Southeast and a wintry mix in the northeast. Yesterday, heavy rain and flooding in northern Alabama forced officials to close some streets there.

In the Northwest, rain falling on top of heavy snow is raising the risk of flooding, avalanches and roof cave-ins.

And in New England, they're coping with a sloppy mix of snow, freezing rains and sleet. Schools and colleges across Massachusetts closed for the day, or at least on delayed openings.

Our Rob Marciano following all of it for us.

Busy, busy day, Rob.

(WEATHER REPORT)

COLLINS: There were warning signs. A wall that stood between a Tennessee coal plant and possible disaster breach. That's according to a former federal mining regulator. He says small leaks in the wall at the Tennessee Valley Authorities Kingston steam plant should have warned company engineers that the wall might not hold.

More than a billion gallons of sludge flooded the neighborhood after the breach. Three homes and hundreds of acres of land were damaged. Land owners are now suing the company.

Meet the woman charged with bringing efficiency to government. President-elect Obama introduces his chief performance officer.

(COMMERCIAL BREAK)

COLLINS: A 6-year-old boy missed his school bus. So he took the family car. He just forgot to tell his parents. Police say the boy drove nearly 10 miles toward the school. He ran off the road several times before hitting an embankment and utility pole near school.

(BEGIN VIDEO CLIP)

SHERIFF CHUCK WILKINS, NORTHUMBERLAND COUNTY, VIRGINIA: He was getting ready to pass some slower movement traffic and meet a tractor trailer with the back end and evidently lost control from overcorrecting. It's amazing that he made it unharmed.

DAVID DODSON, BOY'S FATHER: My wife and babysitter was in the bedroom looking for the youngest one's shoes when he disappeared out of the house. He is a very slick kid, he is.

(END VIDEO CLIP)

COLLINS: Police say the boy suffered only minor injuries in the crash. The boys' parents were arrested on felony child neglect. He's been placed in child protective services.

Well, this idea just popped up. A college student noticed people sneaking alcohol into the moves. So now he's selling alcohol-flavored popcorn. He first tried flavoring his popcorn with real spirits, but that just didn't work very well. So now he uses nonalcoholic flavors like Pina Colada or beer. He says it tastes just like the real thing, but without the buzz.