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Is the Health Care Debate Losing Steam?; Governor Palin Says Goodbye; The Tense Relationship Between U.S. and China; Did Obama Defame Doctors?; Discussing Palin's Future

Aired July 27, 2009 - 15:00   ET

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

T.J. HOLMES, CNN ANCHOR: Coming at you now, Sarah Palin says farewell with a couple parting shots.

(BEGIN VIDEO CLIP)

SARAH PALIN, EX-GOVERNOR OF ALASKA: How about in honor of the American soldier, you quit making things up.

(END VIDEO CLIP)

HOLMES: Point taken. But what we really want to know is what's next for the ex-governor? One of Rick's regulars weighs in with some Republican strategy.

UNIDENTIFIED MALE: I have been in the Army for 10 years and didn't even know it.

HOLMES: OK, that's a problem, especially if you just want to go home, but airport security thinks you're a deserter.

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: "I make a lot more money if I take this kid's tonsils out."

HOLMES: The president of the American Medical Association says that's not exactly true. He's here to sort that out. And, while we're on that topic, is the long, hot summer of health care debate losing steam as we approach the August recess? Who will win? Who will lose?

Your national conversation this Monday, July 27, starts right now.

(END VIDEOTAPE)

HOLMES: And good afternoon, everybody. I'm T.J. Holmes, sitting in today for Rick Sanchez.

Let's move this thing forward. Got a next generation of news, as always, here on Rick's show, a conversation with you. And you, as always, can get involved with this show.

A few issues certainly got you fired up over the past few days or so. One of the biggest ones, the professor, the policeman and the president. A lot of opinions out there, a lot of emotion, a lot of arguments. Your view of the state of race relations in this country. It has filled up our mailboxes, Twitter accounts, our Facebook, you name it, even our voicemail. A lot of you have been chiming in on this story. It's not over just yet, folks.

Today, something else to consider, the very words on the very 911 call that set this whole chain of events into motion. Of course, the president was trying to move away from some of this emotional debate, at least, saying he wanted to put this thing behind, came out and admitted his part in it all.

Also, we learned that this week he does plan to have the sergeant involved in this case, Sergeant Crowley, and also the professor, Professor Gates, to the White House for that beer we talked about that got this whole thing started. That's supposed to happen.

But now we have something else to consider. Take a listen now to a portion of the 911 call that got this whole thing started. Listen.

(BEGIN AUDIO CLIP)

UNIDENTIFIED FEMALE: I don't know if they live there and they just had a hard time with their key, but I did notice that they kind of used their shoulder to try to barge in. And they got in. I don't know if they had a key or not, because I couldn't see from my angle. But, you know, when I looked a little closely, that's when I saw...

911 DISPATCHER: (INAUDIBLE) Hispanic? Are they still in the house?

CALLER: They're still in the house, I believe, yes.

911 DISPATCHER: Are they white, black or Hispanic?

CALLER: Well, there were two larger men. One looked kind of Hispanic, but I'm not really sure. And the other one entered, and I didn't see what he looked like at all. I just saw it from a distance. And this older woman was worried, thinking someone's breaking in someone's house. They've been barging in.

And she interrupted me, and that's when I had noticed. Otherwise, I probably wouldn't have noticed it at all, to be honest with you. So, I was just calling because she was a concerned neighbor, I guess.

911 DISPATCHER: OK. Are you standing outside?

CALLER: I'm standing outside, yes.

911 DISPATCHER: All right, well, police are on the way. You can meet them when they get there. What's your name?

CALLER: Yes. My name is...

911 DISPATCHER: All right, we're on the way.

CALLER: OK. All right, I guess I'll wait.

(END AUDIO CLIP)

HOLMES: OK. So, you hear there that the caller, the caller never mentioned that the men were black. She was asked specifically white, black or Hispanic. She says she didn't know, only saw one guy from what she could tell and the one she saw did not look like a black guy. She couldn't tell what it was.

Also, something else we're finding out there is that the caller, actually, it was brought to her attention that two men were trying to get into the house by another lady. We haven't heard from that other lady even, actually. So this really throws a lot more questions into this mix.

Our Elaine Quijano following these developments for us, she's in Boston today.

(BEGIN VIDEOTAPE)

ELAINE QUIJANO, CNN WHITE HOUSE CORRESPONDENT: T.J., today, Cambridge police released tapes they say speak for themselves. The first is the 911 call that eventually led to the arrest of Professor Henry Gates back on July 16.

In that call, the person describes seeing two men trying to force their way through a front door. Take a listen.

(BEGIN AUDIO CLIP)

UNIDENTIFIED FEMALE: I don't know if they live there and they just had a hard time with their key, but I did notice that they kind of used their shoulder to try to barge in. And they got in.

I don't know if they had a key or not, because I couldn't see from my angle. But, you know, when I looked a little closely, that's when I saw...

DISPATCHER: (INAUDIBLE) Hispanic? Are they still in the house?

CALLER: They're still in the house, I believe, yes.

DISPATCHER: Are they white, black or Hispanic?

CALLER: Well, there were two larger men. One looked kind of Hispanic, but I'm not really sure. And the other one entered, and I didn't see what he looked like at all. I just saw it from a distance.

(END AUDIO CLIP)

QUIJANO: Now, in addition, Cambridge police also released the audio of the police radio transmissions from that day.

Cambridge police also announced that they are forming a committee not to investigate the incident, but, rather, they say, to take away lessons learned from the situation -- T.J. (END VIDEOTAPE)

HOLMES: All right, so there's a lot now to consider. The caller never says the men were white, black or Hispanic or otherwise on that call, so why did race come into this whole thing?

Well, there's another case to be made here. When you look at the police report that Sergeant Crowley filed -- this is it I have in my hand -- he refers to two black males here. He says, though, that when he went and made contact with the woman who made the call, says she went on to tell me that she observed what appeared to be two black males with backpacks on the porch of this house.

So, during the call, she did not mention two black males, but, according to Sergeant Crowley, when he got there and made contact with her, she then, according to his police report, says it appeared to be two black males.

Also, I sat down with Charles Ogletree just on Friday. Charles Ogletree is a fellow Harvard professor of Professor Gates. The two are friends, are colleagues, and, also, Charles Ogletree representing Professor Gates. Listen to just a bit of what he told me when I sat down with him last week.

(BEGIN VIDEO CLIP)

CHARLES OGLETREE, ATTORNEY FOR PROFESSOR GATES: He says, why are you doing this? Is it because I am a black man and you are a white police officer?

HOLMES: Now, was he saying it as calmly as you are saying it to me?

(CROSSTALK)

OGLETREE: Well, the recordings will show.

HOLMES: Yes.

OGLETREE: You can imagine that he is feeling this sense of indignity that people feel every day. And it has nothing to do with race. There are people who feel powerless when they have done everything they can legally do to protect themselves and find that -- what professor Gates found was that, in a moment, you have been arrested.

(END VIDEO CLIP)

HOLMES: Now, you heard Charles Ogletree there and told me on a couple of occasions that, in fact, this was not about race.

This was a -- a matter of bad judgment by a police officer. But, still, since the incident happened, we have been talking in this country a debate about racial profiling. So, I asked him when did this become about race? He said it became about race when that caller called and said there were two black men at the door. And now we hear from the 911 call that the caller never said that. So, a lot of questions, still a lot of things to maybe be worked out and maybe add to some of the confusion, but, still, as the president said, maybe we are going to move past this and going to have that meeting with Sergeant Crowley and Professor Gates at the White House this week.

We got that word today.

A lot of you have all been weighing in on this story, still have emotions on this story one way or another.

Let's go to a few of the tweets we have been getting. Right there on the right screen there: "The first one says the 911 call actually does not matter. What matters is that the police were only verbally assaulted, and that is no reason to arrest."

One more we can do right below that says, "Whoever is at fault in the Cambridge incident, it definitely didn't help the situation between police and minorities. Set it back."

So, please keep those coming in. We will continue to share those throughout this hour, as always.

But don't go away. We will be talking about this story, but we have got much more, including this lady you are probably familiar with.

(BEGIN VIDEO CLIP)

SARAH PALIN, EX-GOVERNOR OF ALASKA: It is because I love Alaska this much, sir, that I feel that it is my duty to avoid the unproductive typical politics-as-usual, lame-duck session in one's last year in office.

(APPLAUSE)

(END VIDEO CLIP)

HOLMES: She says goodbye. Some say she quit. That's Sarah Palin we're talking about, now the former governor of Alaska. What's next for her in her political career? We will have a conversation with a Republican strategist on her political options.

Also, take a look at this picture here. What would you do if you drove up on that? Some people were driving up on that on the street. We will tell you the chaos it caused and where exactly this happened.

Also, the IOU the United States has with China, it's a big one. And you better believe the issue of collecting that cash was on the table when dozens of Chinese government types came to Washington today.

That's next. Stick around.

(COMMERCIAL BREAK)

HOLMES: Yes, that is what we're giving to China right now, just a big old IOU. It supposed to be a routine bilateral conference in Washington, but it's getting a whole lot of attention, a lot of personal attention from the U.S. treasury secretary, the secretary of state, as well as this man, the president of the United States, taking this thing pretty seriously to bring out those big dogs on this particular bilateral meeting.

But, yes, we're talking about China here. Arguably, there is no more important relationship politically, diplomatically and, yes, economically than the relationship between the United States and the People's Republic of China. Two days of so-called dialogue kicked off today, with President Obama calling relations with China that will shape the 21st century.

Rana Foroohar is here from "Newsweek" magazine.

Rana, hello to you.

We assume it's always going to be about the economy. That should be at the top of the list of issues to talk to China about, so what would you say would be the close second?

RANA FOROOHAR, "NEWSWEEK": Well, I think it's going to be economy, economy, economy.

(CROSSTALK)

FOROOHAR: Yes, I think so.

The U.S./China economic relationship is really the most important economic relationship in the world. And it's the fulcrum around what everything else turns. And, so, I think it's key, it's dysfunctional as it stands at the moment, and it's changing.

HOLMES: Yes. You said -- I have heard you use that word before, dysfunctional. Why call it dysfunctional?

FOROOHAR: Well, the U.S. and China are in a very co-dependent economic relationship. Basically, the way it works is they make a lot of cheap stuff. They send it over to Wal-Mart. Eighty percent of what you find in Wal-Mart was made in China.

We get to buy all this stuff. We get to get further in debt. And it's a vicious cycle and it's one of the main things that underscored the global financial crisis that we have just come through.

HOLMES: Well, at this point, who needs who more?

FOROOHAR: That's a great question. I think it's just about equal. People say China holds $1 trillion of our debt. They could tank our economy. But the fact is if they sold off all of those T- bills, their economy would go down, too. So, it's a dysfunctional relationship, as I said. HOLMES: And you told me the number one issue is the economy. Number two is the economy. Number three is the economy. OK, what would be number four, then?

(LAUGHTER)

FOROOHAR: Well, probably politics.

HOLMES: OK.

FOROOHAR: You have probably heard a lot about the "buy America" stuff a few months ago. That's kind of gone away. But about a month ago, China introduced a "buy China" program. That's gotten a lot of attention.

There's a lot of concern about the commodities companies that China's trying to buy up to fuel its own energy needs. So, everything's very political right now. And I'm sure that some of the talk behind the closed doors will be about all that.

HOLMES: How tough can we get with this talk?

I mean, the president came out today. And I guess some of it, he didn't back away. He had some strong words about what needs to be done on both sides, but also maybe a little criticism for China and its record as far as -- I guess in terms of human rights and freedoms.

But, still, how tough a talk can we expect to hear if we don't hear it publicly? Behind the scenes, how contentious I guess can these talks get?

FOROOHAR: Well, I'm not sure I would say they would be contentious. I think there's going to be a lot of frank discussion because both countries know that they need each other and the rest of the world needs them to stand up and take a lead in fixing the global economy and fixing these imbalances that I have been talking about.

HOLMES: How much time do we have left with the almighty dollar? You and I were talking about this just a second ago. You said it might only have enough life in it for another 10, 15 years?

FOROOHAR: Well, the dollar's always going to be with us, but it's slowly going to take a less important role in the global economy. And believe it or not, that's actually good.

One of the reasons that we're all in debt is that the dollar is artificially inflated by all these countries like China that have to buy our currency. If there's a more balanced currency system, it will be good for all of us.

HOLMES: Well, how helpful -- I guess name the two things. We're talking about economy a lot, but what does the United States need or what issue does the United States need China for the most?

Now, we talked about economy here, but, also, with other issues around -- whether that's climate change, whether that's North Korea, what do we need them? On what topic do we need their help the most?

FOROOHAR: Well, I think you just named it. We need them on just about every key global issue. We need them to rebalance the economy. We need them to address climate change. We need them to be our biggest partner in Asia.

Japan has always held that role, but I think it's going to be China in the future. The relationship between the U.S. and China politically in Asia is going to be key to securing that region. So, pretty much all of the above.

HOLMES: And last thing here. Are we going to see any major shift in whether that's policy or in just outright friendliness of a relationship between China with this administration, the Obama administration, vs. the Bush administration?

FOROOHAR: Yes.

I think you're going to see -- I wouldn't say necessarily friendlier, because I don't think the relationship with the Bush administration was contentious. But I think you're just going to see a lot more frank talk. And China is ready now to take a greater role in international dialogue and the U.S. is recognizing that. And it's a good thing.

HOLMES: All right. Rana Foroohar, again, with "Newsweek" magazine, ma'am, we appreciate you taking the time with us today. Good talking to you.

FOROOHAR: Thank you.

(BEGIN VIDEO CLIP)

UNIDENTIFIED MALE: To just one day be arrested and like, here you go, you're detained, you know, I mean, it's...

(END VIDEO CLIP)

HOLMES: This is a pretty big mixup to tell you about here, a military mixup, a man who was never in the Army thrown in jail, accused of being a fugitive for 10 years, called a deserter. You have got to hear what happened to him.

And the debate over health care continues. The president of the American Medical Association says doctors do care about patients, and the decisions they make are not just about money, despite what the president says.

(COMMERCIAL BREAK)

HOLMES: All right, a lovely, lovely picture here of Atlanta, Georgia.

This is where I and a lot of my colleagues here at the world headquarters, we live, right there. Anybody across the country, you live in a city, you have to deal sometimes with potholes on your streets. That's probably the one thing that mayors often hear about, potholes. How about this pothole?

This is not in Atlanta. However, this is what happened this weekend in Toronto. That's a pothole. I don't think I will complain to the mayor's office here about potholes anymore after seeing this one.

A sinkhole, probably more accurate to call it, 15 feet across, 40 feet deep at some points. This is Finch Avenue, a busy thoroughfare in Toronto. They have had several days of heavy rain there and old storm drains underneath and this is what often happens. This has actually happened on the same street before.

Going to take quite awhile to fix this thing. So far, the city workers don't know exactly how to fix it, however, but a heck of a picture to imagine you driving up on that on your street, a lot more than just a pothole.

We are going to turn back to health care. The clock is running out on President Obama's deadline to pass health care reform. Is anything going to happen? We will get insight next from, who else? Patricia Murphy.

Stay here.

(COMMERCIAL BREAK)

HOLMES: All right, we're just getting word out of New Jersey.

They are investigating 11 letters that have been received around the state, around several locales, with white powder. That's what's happening now, an investigation. At least 11 letters have been sent to various offices containing white powder. I think we're told these are public and government offices throughout the northern part of New Jersey.

They have been receiving them at these offices. That started on July the 17, been received in Clifton, Wayne, Ringwood, Woodland Park, also Fair Lawn, if you're familiar with the area, but all in northern New Jersey. No idea who is certainly responsible at this point. The investigation goes on.

Important to note that no one at this point has been harmed and they don't exactly know what the substance is in each of them. They don't have final results yet. The first three at least they have tested. Don't have final results yet, so don't exactly know what has been in these letters.

But at least 11 letters been sent to government offices, various offices, public and government offices, throughout northern New Jersey with this white powder. And it is being investigated at this point. We will continue to follow up on that, but again important to note, nobody been harmed just yet.

Let's turn to health care and health care reform. You remember when President Obama was calling on Congress to pass health care legislation by when? August. Well, August is coming and the way things are going right now, even the president seems to be admitting that August ain't going to happen. Listen to what he said over the weekend.

(BEGIN VIDEO CLIP)

OBAMA: This debate is not a political game for these Americans, and they cannot afford to keep waiting for reform. We owe it to them to finally get it done and to get it done this year.

(END VIDEO CLIP)

HOLMES: Patricia, that sounds a little different there.

Patricia Murphy of PoliticsDaily.com in Washington, it was a hard date. Get this done by August. He clearly just kind of slid it in there, by the end of this year.

PATRICIA MURPHY, POLITICSDAILY.COM: Yes, in your words, T.J., ain't going to get it done.

(LAUGHTER)

MURPHY: It's not happening before August. It may not even come out of the Senate committee before August.

There are all sorts of moving parts right now on health care. When you envision health care, think of marbles bouncing on a hardwood floor. That's what's happening in Congress right now. Members of Congress don't know exactly what's in these plans. Some of them have not been finalized. They are being pushed by their leadership to come on board and say they're going to support these plans, and, right now, all of this still has yet to form. We just don't know what's going to happen with it. But it's not getting done before August.

HOLMES: OK. Why does it sound like at least that Nancy Pelosi, the House speaker, hinting that she still wants to push for something by the recess? Why would she be doing that?

MURPHY: Well, she wants to get it done and she said last week she has the votes.

And it was unclear at that moment if she was literally counting votes and knows she's going to get it done or if she was just setting up a bar that she says she is going to pass. She wants to get this done because these members of Congress are going home for the month of August. They will be subjected to an onslaught of what's going to look like a presidential campaign for health care, basically. They have will ads run in their district. They are going to have town hall meetings. There are going to be debates for and against going on in front of them.

And so these members are going to hear case for and case against health care. If they have already voted for health care, she has already that win in the bag. It's very unclear if she's going to get to have that vote, though. So they may go home and get an earful from their worried constituents, nervous about passing such a big health care bill, and they may back away with their support. That's why she wants to get it done.

HOLMES: But, Patricia, if they go home after voting in the House at least, nobody's saying anybody's going to get anything done in the Senate before the recess, if they vote in the House on some legislation and then have to go home like you said in these town halls and have to defend it, they might be defending a vote on something that might not end up in the final bill anyway.

MURPHY: That's exactly right. And that is exactly what Nancy Pelosi is hearing back from her members.

This happened on the energy bill. A lot of House members, very moderate to conservative Democrats, voted for that energy legislation. They got an earful when they went home for July 4 recess and nothing's even happened in the Senate yet. So, they felt they spent a bucket of political capital for nothing in return. They don't want to go down that road again.

So, you can start to see this very, very, kind of very sticky political situation every single member, especially those conservative Democrats, have. That's why they're so reluctant to get on board with a health care plan. The Senate may not take it up -- they won't take it up before August. They may not even take it up in September. We just don't know what's going to happen. They don't want to commit without knowing that.

HOLMES: OK. Last thing here. What's the biggest threat to the president time-wise? If more time goes by, is there a danger of losing more fellow Democrats up on the Hill, or, as time goes by, he's losing the support of the American people as this debate continues?

MURPHY: That's exactly the tension. You have put your finger right on it. And August -- I personally think August could be good for this bill. Members can go home, not only hear from people who are worried about passing health care reform, but then hear from people who are having their own personal tragedies, basically, because of health care reform.

We know that bankruptcies happen because people get cancer. They have terrible personal stories. Members of Congress could hear that, too. They could come back and feel better about voting for a bill. Right now, there is just all sorts of anxiety related to this bill. They could solve that with the August recess. But the president is going to keep pushing, and he's going to keep pushing hard.

HOLMES: Well, you spoke of anxiety. We are anxious as well, because we are expecting to hear from Nancy Pelosi, the House speaker, and other House Democratic leaders at 3:45. They're supposed to be having a press conference on health care, so maybe we will get some news out of that.

But, Patricia Murphy, PoliticsDaily.com, good to see you again.

Thank you so much.

MURPHY: Great to see you. Thanks. HOLMES: The governor of Alaska steps down, but she's pretty vague about what she's going to do now. Stick around if you missed it.

(BEGIN VIDEO CLIP)

OBAMA: I make a lot more money if I take this kid's tonsils out."

I make a lot more money if I take this kid's tonsils out.

(END VIDEO CLIP)

HOLMES: Ooh, some doctors didn't like to hear that. Ahead, the American Medical Association reacts to President Obama.

Stay here.

(COMMERCIAL BREAK)

HOLMES: All right, I want to remind you that we are standing by to wait for Democratic leaders, including the House Speaker Nancy Pelosi to step up to that microphone and to give some kind of a statement, some kind of a briefing, maybe some new information about health care reform.

Trying to get something out of the House by the August recess. Don't have a lot of time left. A lot of people think that is just not a possibility at this point but we will see. Hopefully we'll get some more information. Again, that's expected at 3:45, just 15 minutes from now. When it happens, you'll see it live here on CNN.

Meanwhile, Rick -- Rick Sanchez, he's not here right now but he was talking about the health care reform debate all last week and got into something last week that the president said, something he said during his news conference. It had a lot of people's ears perking up. Take a listen.

(BEGIN VIDEO CLIP)

OBAMA: Right now, doctors, a lot of times, are forced to make decisions based on the fee payment schedule that's out there. So if they're looking and you come in and you've got a bad sore throat, or your child has a bad sore throat, or has repeated sore throats, the doctor may look at the reimbursement system and say to himself, "You know what, I make a lot more money if I take this kid's tonsils out."

(END VIDEO CLIP)

HOLMES: All right. Dr. John Rohack is the president of the American Medical Association. He joins us now. Sir, is it fair to say that you or even some of your members were in some way offended to hear that, that the president suggests that a doctor, not necessarily looking out for the patient but looking out for his bottom line?

JOHN ROHACK, PRESIDENT, AMA: Well, physicians every day in America are working day and night to try and do what's best for patients based on what they have in front of them. We know because I'm a physician myself that we try and do what's right for the patient based on what they need.

So when we take a look at a broken American health care system, we know that there's variation across the country. Sometimes people live and work in a place where if a physician doesn't do something, they're going to be sued in a courtroom. So, we're committed to making fundamental health system reform this year to make all the incentives align to do what's right for patients.

HOLMES: And nobody at all -- I mean, we've all had great experiences with our doctors over the years, but at the same time, again, sir, you kind of went around it there a bit. The president got up and suggested that there are doctors out there who are making decisions based on a bottom line and making money, and not what you just said, doctors who are looking out for their patients. Again, did that just kind of rub you the wrong way to hear the president in a prime time news conference come out and make that accusation against this country's doctors or some of this country's doctors?

ROHACK: Well, again, there's variation in care and we know that there's variation in care. What we want to do is to say what's based on science, the right thing for the patient and when...

HOLMES: And when you say variation, you mean a little hanky- panky?

ROHACK: No. What we're talking about is in some areas of the country, many times in areas where you're sued if you're not doing something, people do more things. We know that we've got to change our system. Our system, really, for 50 million Americans that don't have health insurance or can't afford to buy health insurance, it's time we have the debate to change things now.

And so we're committed as the American Medical Association to say look, there are some things we do in the United States that's great but there's some things we do that really aren't for the best interests of our society. Let's fix those things. Let's make sure everybody has affordable health insurance coverage and let's make sure the doctor at the time the patient needs the care, has the evidence- based medicine what's best for that patient at that time.

HOLMES: Well, yes, I think in some of that, you're referring to some of the lawsuits, what some have referred to as defensive medicine. They want to make sure they exhaust all possibilities so god forbid if something comes up down the road, that patient is actually sick, they have documented that this doctor actually did all the tests they could possibly have done.

Let me ask you as well, why come out already and support some of the legislation in the House before it's in its final form? I know there has been some fraction there between some of the state medical associations that are affiliated with you, not everybody is supporting it just yet. So why come out and support it before you know exactly what it's going to look like? ROHACK: Well, pretty simple. The status quo's unacceptable. And the American Medical Association, we believe and have been working for fundamental health system reform for many years. We wanted to make sure that the process didn't stop and at the time that this discussion was going on, there was a big significant problem occurring in America. Some people thought that status quo was OK, and as physicians caring for patients, we're saying no, it's not, for many of our patients, we need to make significant changes.

So our endorsement of the bill just recognizes that we have a House, we have a Senate, there are different components that have to work. We just want to make sure we move forward so that we can have affordable health insurance coverage for everybody. That's the goal.

HOLMES: Something you haven't been a big fan of is that public, I guess that public option to essentially have a government-backed option out there for health insurance. Now, that is in the bill and from what it appears, it seems to be popular at least up on the Hill. You weren't, and your organization not a big fan of that. So if it is still in that final bill, can you now -- are you now telling me you all are supportive of that public option?

ROHACK: Well, we know that there are public plans. For example, the federal employee health benefit program is a public plan. It's paid for by tax dollars and it benefits federal employees. So some public plans actually are a benefit. They provide choice, they provide the ability to pay hospitals and physicians a fair wage and a fair compensation for the services they're providing.

So we need to focus on what do we want? We want choice. We want to make sure that the patient has the ability to choose whatever coverage they want. We want the freedom as physicians to be able to practice in whatever environment we want and not be forced into something that won't cover our overhead costs and we have to close our practice.

But most importantly, we recognize this is America. We want to have an American system and that means private sector and public sector working together so that everyone has affordable, quality health insurance. It's a goal we need to achieve.

HOLMES: I want to be sure I'm clear on this because that's been a major issue you all have had, but a public health option, a government-run option as it stands in this bill, the AMA is supportive of?

ROHACK: When we took a look at principles of freedom of choice, freedom of practice, in the current bill that was H.R. 3200 that was proposed, it allowed the patients to opt out, it allowed the physicians to opt out. It didn't require anybody to be fixed within a system and it only could be offered for individuals or small employers that right now don't have health insurance.

So, it's for a segment of our population that right now aren't insured and the problem is we know that this bill has more to do. It doesn't deal with the defensive medicine costs. We have to make this thing affordable so that it will be sustained long-term. We endorse the bill knowing that we still have to work on it to make it better. We're supporting amendments that deal with the real issue of defensive medicine and the cost drivers of that so we want to keep the process moving forward.

HOLMES: Well, Dr. Rohack, that process seems to have a lot of steps still left. We certainly anticipate seeing you a lot down the road.

Dr. John Rohack, president of the American Medical Association. Kind sir, we appreciate you spending some time with us today.

ROHACK: Thank you very much.

HOLMES: And speaking of health care, we are standing by waiting for the House Speaker Nancy Pelosi and her fellow Democratic leaders to come to that podium. Not sure what they are going to say, but any time they speak on health care these days, it does make news when it does happen. Expecting it in about seven minutes from now. We will bring that to you live.

For those of you who missed Governor Sarah Palin's goodbye over the weekend, we'll play a bit of that next and tell you what she said and more of your feedback when we return.

(COMMERCIAL BREAK)

HOLMES: Michael Vick is back. That's the short of it, folks. Michael Vick, the former Atlanta quarterback, has been reinstated by the NFL commissioner today. This is coming to us from the Commissioner Goodell just a short time ago, Roger Goodell saying in fact, Michael Vick has been reinstated.

You know this story, know it well by now. Michael Vick served 23 months jail sentence for his operation of a dog fighting ring, essentially. Lost everything and essentially, he was kicked out of the NFL while he was in jail. There's a process you have to go through, they essentially suspend you from the NFL. You have to get reinstated. Well, he was reinstated. He is now allowed to play in the NFL.

Still a huge obstacle ahead for him right now, is finding a team willing to give him a chance. Two big chances they have to take is one, he's been out of football for so long, is he still in that kind of NFL shape, will he ever be the kind of quarterback he was, but also, two, everything that will come with it. They know protests are probably going to come. A lot of people still don't think he should have a chance to play in the NFL ever again, for this matter.

But according to Roger Goodell, he has reinstated Michael Vick. He can participate in all team activities, he can also participate in the final two preseason games of any team that happens to pick him up. However, he wouldn't be allowed to play in a regular season game until October the 6th, I believe it is, that's week six of the NFL season.

So even though he's reinstated, still couldn't play in a regular season game until week six of the NFL season. But Michael Vick, this drama, this story, this rise and this fall, one of the most talented quarterbacks that's ever played in the NFL by all accounts, has now been reinstated after all he went through in the dog fighting ring. Served his time, but Michael Vick reinstated. We'll see what happens now to see if he does get picked up by another NFL team.

We are still standing by. We could be just a couple minutes away from hearing from Nancy Pelosi, the House speaker, the Democratic leader, up on the Hill, expected to talk about health care at 3:45 at that podium right there. When she comes out with the fellow Democratic leaders, we will have it for you live. Stay with us.

Also, this much we know. We haven't seen the last of Sarah Palin. As for Palin's next gig, we don't so much know about that. Her farewell address to the state of Alaska isn't giving us a whole lot to go on. She spoke yesterday in Fairbanks. Her address reminiscent of the style that made her a Republican star as the GOP's vice presidential nominee. Like everybody else, we are intrigued at the notion of Sarah Palin as the Republican Party savior. We will talk about that in a moment with GOP strategist Rich Galen. But first, Sarah Palin bidding farewell to Alaska after cutting short her single term in office.

(BEGIN VIDEO CLIP)

SARAH PALIN, FORMER GOVERNOR OF ALASKA: Thank you so much. Oh, thank you so much for that very warm welcome. What an absolutely beautiful day it is and it is my honor to speak to all Alaskans, to our Alaskan family, this last time as your governor. And it is always great to be in Fairbanks. The rugged, hearty people who live up here and some of the most patriotic people whom you will ever know live here. And one thing that you are known for is your steadfast support of the military community up here. And I thank you for that and thank you, United States military, for protecting the greatest nation on Earth. Together, we stand.

First, some straight talk for some, just some, in the media, because another right protected for all of us is freedom of the press, and you have such important jobs, reporting facts and informing the electorate and exerting power to influence. You represent what could and should be a respected, honest profession that could and should be a cornerstone of our democracy. Democracy depends on you and that is why, that's why our troops are willing to die for you. So how about in honor of the American soldier, you quit making things up?

So, we are here today at a changing of the guard. Now, people who know me and they know how much I love this state, some still are choosing not to hear why I made the decision to chart a new course to advance the state. And it should be so obvious to you.

It is because I love Alaska this much, sir, that I feel that it is my duty to avoid the unproductive, typical politics as usual, lame duck session in one's last year in office. How does that benefit you? With this decision now, I will be able to fight even harder for you, for what is right and for truth. And I have never felt that you need a title to do that. (END VIDEO CLIP)

HOLMES: All right. That was just a portion there. Let me bring in Rich Galen, Republican strategist, now. Rich, I know you listened to the whole thing more than likely, and you heard her so what did she do right in this last speech?

RICH GALEN, REPUBLICAN STRATEGIST: Well, what she did right was allow the media to set up, we couldn't see the other way, but I suspect there was a fairly significant press platform with the bleachers and the writing press and the sticks and the whole ball of wax that she could pick on. So actually, I'm not sure what she did right, but on her behalf, the media certainly played into her hands by showing up en masse and providing her literally and figuratively a platform against which to play.

HOLMES: Oh, my goodness, all right. Well, that's just one question we have for you. We have plenty more. We're going to take a quick break and talk to Rich Galen on the other side.

(COMMERCIAL BREAK)

(BEGIN VIDEO CLIP)

JERRY STEVENS, ALASKA RESIDENT: Maybe Texas wants her, I don't know. Well, she can come up and fish in the summer, I guess.

(END VIDEO CLIP)

HOLMES: That's just one Alaskan's opinion after the resignation address of former Governor Sarah Palin. Let's take a quick look at Palin's approval among the country as a whole here. Overall, 40 percent favorable. Keep in mind, this was before her surprise resignation, July 3rd, or the announcement, at least, that she was going to resign. She had strong favorability among Republicans at 70 percent, 40 percent among Independents and among Democrats, probably no surprise, just 20 percent. Again, joining us, Republican strategist Rich Galen. And Rich...

GALEN: I think that poll was after her announcement.

HOLMES: That was after the announcement? Oh, all right.

GALEN: Yes.

HOLMES: Maybe that's a little more accurate or gives a little better sense of how the country feels about her. More recent than we even thought here. So, what about Republicans? We see that number saying how much still have a favorable opinion of her, but how about the party, I guess the higher-ups in the party? How do they feel about constantly seeing Sarah Palin as in a lot of ways a spokesperson for the Republican Party?

GALEN: It's not so much being a spokesperson, but I think the party's elite, so to speak, feels pretty strongly that what she does do, is because of the media attention she attracts, and it's not positive media attention, it's the kind of drive-by shooting media attention, but she does attract so much of it that it's very difficult for anyone else to sort of get on stage or share the spotlight. So, I think from that standpoint, she's not helpful, number one.

Number two is that 70 percent of number of Republicans that was in that "Washington Post" poll you put up there, that's not particularly high for party faithful for somebody that's under constant attack from the other side. You would have looked for somebody -- she should have been in the mid to high 80s if she had kind of a broad base of support.

HOLMES: OK and you're a Republican strategist here.

GALEN: Right.

HOLMES: How much of her strategy is flawed if you were advising her?

GALEN: All of it.

HOLMES: All of it.

GALEN: Yeah. Well, first of all, you can't -- I mean, look, she did two things wonderfully well. She gave a great speech in Dayton, and she gave a great speech at the Republican National Convention. I was on the floor for that.

HOLMES: OK.

GALEN: And I will tell you it blew the roof off. She was great.

HOLMES: OK.

GALEN: But after that, it was kind of a downhill slide. Resigning as governor, she can say anything she wants about the old politics of being a lame duck. But you signed up for four years. You didn't sign up for four years minus 18 months, so you knew what you were getting into.

And the last part is that if she comes down to the lower 48, I'm not so sure that will be in her benefit because she'll lose that sort of aura of it's hard to get to her, we don't know her and every time she says something, we really want to cover her. If she moves to Texas, California, New York, whatever, then she becomes sort of a regular in the mix and I think that will not be helpful to her.

HOLMES: I've got another sound bite here I want to play from her speech, but I want to ask you one question and get a quick answer before I roll this sound bite.

GALEN: OK.

HOLMES: And that is, Sarah Palin, does it still work for her to use this argument that she just wanted to get -- I guess you kind of hit on it there about some would say excuses she's making for leaving the office. But how much of this boils down to money? She can make probably a pretty decent chunk of change when she leaves the office. Do you think it's that simple?

GALEN: Oh, it might be. I have no idea. And people that know her say it's very difficult to try to gauge what's in her mind so, there's no way of knowing what is behind it or what combination of things is behind it. But her electoral career is over.

HOLMES: All right, a lot of the harshest words she had yesterday for the media yesterday. Take a listen.

(BEGIN VIDEO CLIP)

PALIN: Don't underestimate the wisdom of the people and one other thing for the media, our new governor has a very nice family, too, so leave his kids alone.

(END VIDEO CLIP)

HOLMES: Does that line still work, just to blame the media for all your troubles?

GALEN: Well, the fault here Brutus lies in...

HOLMES: Rich, I'm sorry, I've got to jump in here and interrupt you, but man, we knew this might happen. But we're seeing Speaker Pelosi step up to the microphone here with other leaders to talk about health care. Let's listen in.

REP. NANCY PELOSI, (D-CA), SPEAKER: -- continue our discussions with colleagues, and I'm very pleased to report that we're moving closer to a place where we will make -- we will lower costs, we will improve the quality of care, we will expand choices, and we will get peace of mind to the American people.

We're moving closer to a point where we hold the insurance companies accountable. This afternoon, you'll hear from my colleagues about how the CBO has reported and disputed claims made by the Republicans about what our legislation will do. We will hear from our chairman of our caucus as to what positive things will happen in the district of our members in terms of expanding opportunities for health insurance.

And from our distinguished whip, we'll talk about the costs of doing nothing, costs of doing nothing. Huge to the American -- to America's families, to our federal budget, and to our economy. We'll hear from --

HOLMES: All right. We're going to continue to monitor. She's just going through some of the pleasantries there at the very beginning, setting up a groundwork of how this thing is going to work. We're going to get a quick break in, we'll continue to monitor this, be right back.

(COMMERCIAL BREAK)

HOLMES: All right, we appreciate our i-Reporters as always. Look at this iReport picture we've got coming in. But this is a waterspout. This developed over the water, turned into a tornado. These were from Ormond Beach in Florida, Friday afternoon, more than 100 homes were actually damaged when this thing came ashore. But, again, these pictures came to us, as you can see it develop out there, over the water. They look pretty over the water, but when they come onto land, they get dangerous, get scary and they do become destructive. And that is what we saw here. You can see that thing making its way. But again, these pictures came to us from one of our i-Reporters actually caught this thing as it developed over the water. But, again, this thing became pretty destructive.

All right, quick break, going to wrap this show up. Oh, no break. Sorry, I got ahead of myself. My producer is screaming at me right now. We're actually going to share some tweets from some of you to wrap up this show.

We were talking a lot about health care today. Let's go through a couple of these. One said, the second one there, I'll show you, says "If I got seriously ill, my two choices -- bankruptcy or death. Why is health care for profit?" Kind of playing off that for-profit thing, as a lot of people think insurance companies are just in this thing to make money.

So also playing off the comments we played from the president that upset some doctors saying that some doctors gave unnecessary tests, unnecessary procedures just to make a buck. Let's go down one on to the next person there, saying "First we had big government control our health care, next our finances, then our dinner options, next our entire lives."

You see the sentiment here. Also another saying "The AMA flak is lying." I guess you saw the head of the AMA we had on just a short time ago. "I just saw a doctor for 15 minutes because of a sore shoulder. He charged me $580." Sir, I certainly hope at this point your shoulder feels better.

Another here saying "The American health care is based on profit. That is why they reject millions of people. Patients don't matter to them." I'll do one more here. "If you want to see what government- run health care looks like, take a look at the mold-stained walls and long wait times of the VA."

We appreciate you all, as always, participating in this show. I'm T.J. Holmes again sitting in today for Rick Sanchez. I'm going to hand it over now to "The Situation Room," Wolf Blitzer.