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Americans Jailed in Haiti; President Obama Takes Q&A from the Democrats

Aired February 03, 2010 - 10:00   ET

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

KYRA PHILLIPS, CNN ANCHOR: Almost at the top of the hour; here's your top stories.

Backlash from the arrest of ten American missionaries in Haiti and a plea from an orphanage there asking UNICEF to open its tent cities filled with children so they may be better cared for at other facilities. God's Littlest Angels in Haiti says the U.N. is holding the kids to prevent possible child trafficking.

Meanwhile a hearing set for this hour on Haiti for five Idaho- based charity group members facing child trafficking charges. We'll get the latest in a live report from our Karl Penhaul momentarily.

Pilot error. NTSB investigators have ruled that was the cause of Continental flight 3407. The crash happened nearly a year ago. 50 people were killed that night outside Buffalo. Investigators say the pilot reacted incorrectly when the plane went into a stall. The pilot and co-pilot were also criticized for continually chatting with each other when they should have been aware of what was happening with that plane.

Two candidates remain standing in the fight for President Obama's former seat in Illinois. Illinois state treasurer Alexi Giannoulias won yesterday's democratic primary. Then you got Congressman Mark Kirk. He actually took the GOP primary. Voters return to the polls in November. Current Senator Roland Burris appointed by then Governor Rod Blagojevich said he wouldn't run for a full term.

Happening any moment now. We're waiting for President Obama to go off the script. Just days after meeting with Republicans, the president is holding a similar informal gathering with fellow Democrats. This is a live picture right now where the president is due to speak any moment. He's going to deliver remarks, field some questions and hopefully we'll find out more about where he stands with his own party. We're going to join this live as soon as it gets under way.

Ten Americans jailed in Haiti accused of trying to steal children. They've got another chance to straighten all this out before Haitian authorities. And CNN's Karl Penhaul is monitoring what could be their fate today. Karl, what do you think?

KARL PENHAUL, CNN CORRESPONDENT: Well, Kyra, we've been doing a lot of digging on this story. And now based on sources that work with the Americans, we believed that there were a series of unauthorized meetings with the Haitian policeman and also a Dominican official. Those meetings took place between the American Baptists and those unauthorized officials with the aim of trying to facilitate the passage of 33 Haitian children and babies across the border from Haiti into the Dominican Republic.

Passage for those children even given that they did not have any official documentation or passports to cross that border. It was an illegal crossing, so to speak. Now talking to translators who worked with the Americans for most of the time that they were in Haiti, those translators have told us that on two occasions the American Baptists held a meeting with a Haitian police officer or a man they believed to be a Haitian police officer.

That Haitian police officer offered to give help to the Americans to try and get them some kind of documentation from the Dominican embassy. What we don't know is that if there was any offer of money changing hands to facilitate that document. We don't know yet what kind of document, if any, was provided. But we do know that there was a meeting on Tuesday and a subsequent meeting in or at the Dominican embassy on the Thursday.

And then on the Friday, that's where the allegations of the Dominican official come into play because the translator who was on the bus said that when the Americans' bus was stopped at the border crossing by Haitian police, the team leader of the American Baptists put in a call to a man across on the Dominican side of the border and then a man dressed in a uniform then appeared to try and smooth things over with the Haitian police to facilitate the bus continuing on its journey. That attempt failed.

Now, we put those allegations last night to the Americans in their jail cells and that they did concede that they knew a Haitian policeman and had two meetings with him. They also conceded that they knew a Dominican official they described as a coast guard. They say there was no wrongdoing there and they say that god put those officials in their way, Kyra.

PHILLIPS: So bottom line, Karl, depending on how this all plays out in this court hearing that you're going to monitor and we are going to dip into as soon as it begins, could they be freed and sent back to the U.S.? Is that a possibility?

PENHAUL: I think if you think about the allegations that we have found out, one can assume that the Haitian police will also be on top of that and if there are allegations that unauthorized officials or officials held unauthorized meetings with the Americans, then that really changes the whole aspect of this. Maybe it was not a question of misunderstandings and good intentions, maybe there was a wider plan here to try and to try and get those Haitian children into the Dominican Republic at any cost, Kyra.

PHILLIPS: All right. Karl Penhaul, let us know as soon as you know something. We want to follow up, of course, for our viewers. We've stayed on top of this story. Thanks, Karl.

Live pictures right now of the president of the United States. He hasn't begun speaking yet but we are going to take it live as soon as he steps up to the podium. He is at the museum there in Washington, D.C.. He's actually going to take Q&A with Senate Democrats. You may remember five days ago it turned out to be a pretty heated exchange when he had a Q&A session with Republicans.

And it's interesting because it was a highly unusual televised Q&A session with the Republican representatives. And we took it in its entirety. So now we are interested to see what's going to happen with Democrats, if indeed his own party will, I guess, turn up the heat with the president like the Republicans did. It's an interesting time in our country, so we will take it live as soon as the president starts speaking. Harry Reid obviously introducing him right now.

Well, it's hard to believe it's been about seven months since we've heard and reported the news.

(BEGIN VIDEO CLIP)

WOLF BLITZER, CNN HOST: We're getting some breaking news coming into the "Situation Room" right now about Michael Jackson, the king of pop, who's 50 years old. Let's go to Deborah Feyerick, she's working the story for us. What are we picking up?

DEBORAH FEYERICK, CNN CORRESPONDENT: Well, it appears that we can tell you that this is what's being reported by KTLA. Apparently, Michael Jackson suffered cardiac arrest this afternoon. He was rushed to UCLA Medical Center.

K.T. PILGRIM, CNN ANCHOR: I have to stop you now A.J., CNN can now confirm from the L.A. coroner that Michael Jackson is dead. So again, CNN is confirming from the L.A. coroner that Michael Jackson is dead.

(END VIDEO CLIP)

PHILLIPS: Yes, that was June 25th of last year. Can you believe it? And many tears, tributes, lots of speculation since then. The story has definitely not gone away. But no real justice or accountability to speak of as well but that could come any minute now.

We're talking about that first step as Jackson's doctor, Conrad Murray, gets ready to turn himself in. CNN's Ted Rowlands has been following those developments for us.

Ted, it's a story that you have been following since June and this could be the moment where we finally get some results.

TED ROWLANDS, CNN CORRESPONDENT: Yes, And finally get some more details on what the state has against Conrad Murray, if they do file this criminal complaint. Basically Dr. Conrad Murray, the physician that was with Michael Jackson at the time of his death and the physician that was treating him leading up to his death and the physician who gave him that propofol, that anesthesia that's normally used in a clinic at his home.

He is prepared to turn himself in. He's traveled from Houston along with his legal team, to Los Angeles and they are prepared to surrender because they anticipate criminal charges will be filed as early as today, but they anticipate at some point this week. They don't know when and they don't know where a surrender could take place.

It's safe to say that over these past six months investigators have gone through all of the paper trails and all of the trails that touched Murray and they have concluded after months and months of investigation and consultations with the district attorney's office here in Los Angeles that they have enough to move forward with some sort of criminal complaint against Murray.

That's why he's in Los Angeles. And according to his lawyer, he is more than ready to surrender at a moment's notice as soon as that criminal complaint comes down. So we're waiting for that to happen. We don't know when and we don't know specifically where, but we do now after six months know that something is coming down against Dr. Murray in the death of Michael Jackson.

PHILLIPS: Got it. All right. Let us know as soon as you know something. Ted Rowlands there in Los Angeles, California, for us wondering if indeed Conrad Murray, Michael Jackson's doctor, will turn himself in today. Ted, thanks.

All right. Let's get straight to the president of the United States. He's about to hold Q&A with the Democrats just like he did with Republicans five days ago. Let's listen in. He's at the museum in Washington, D.C.

(JOINED IN PROGRESS)

BARACK OBAMA, PRESIDENT OF THE UNITED STATES: ... State of the Union or at least pretend to listen to me. So, I'll try to keep it relatively brief. Some opening remarks and then open it up for questions.

First of all, I just want to thank Harry Reid. I recently said he's got one of the toughest jobs in Washington. Managing an institution that by its very nature is, let's face it, you guys are a little difficult to manage. I've been a part of this caucus.

I really don't think anybody could have done a better job under more trying circumstances than Harry Reid, and I think he deserves a huge round of applause.

Now, let me start by saying we always knew this was going to be a difficult year to govern, an extraordinarily difficult year to govern. We began 2009 with the financial system on the brink of collapse, an economy bleeding nearly 700,000 jobs per month, a $1.3 trillion deficit and two wars that were costly in every sense of the word.

We knew that solutions wouldn't come easily or come quickly. We knew that the right decisions would be tough and sometimes they would be unpopular. And we knew that we might have to make them sometimes without any help from our friends on the other side of the aisle. But we made those decisions. We led. Those actions prevented another great depression. They broke the back of a severe recession.

The economy that was shrinking by six percent a year ago is now growing at nearly six percent one year later. That's because of the work that you did. Harry listed some of the work that you did on behalf of the American people, even under these difficult circumstances. Extending health insurance to four million children, protecting consumers from getting ripped off by their credit card companies and kids being targeted by big tobacco.

Some things that weren't noted or didn't get a lot of attention, you reformed defense spending by eliminating waste and saved taxpayers billions while keeping us safe at the same time. You gave billions of dollars of tax relief to small businesses and 95 percent of working families here in America.

You did all this despite facing enormous procedural obstacles that are unprecedented. You may have looked at these statistics. You had to cast more votes to break filibusters last year than in the entire 1950s and '60s combined. That's 20 years of obstruction packed into just one. But you didn't let it stop you.

As Harry mentioned, though, our mission is far from accomplished, because while the worst of the storm has passed, far too many Americans are still hurting in its wake. I know you've seen it back home in the shuttered businesses, the foreclosed homes. You've heard it from constituents who are desperate for work, and we've seen it in the burdens that families have been grappling with long since this recession hit. Issues that we've been talking about now for years.

The burden of working harder and longer for less, of being unable to save enough to retire or to help a kid with college expenses, the extraordinarily constant rising costs of health care. These problems haven't gone away. It's still our responsibility to address them. All that's changed in the last two weeks is that our party has gone from having the largest Senate majority in a generation to the second largest Senate majority in a generation.

And we've got to remember that. There was apparently a headline after the Massachusetts election, the "Village Voice" announced that Republicans win a 41-59 majority. It's worth thinking about. We still have to lead. Saving and creating jobs have to continue to be our folk us in 2010.

Last year we gave small business the engines of job creation, tax relief and expanded lending through the SBA. I don't know if you are aware that SBA loans have gone up 70, 80 percent, which, by the way, indicates the degree to which there is still huge demand among small businesses. Some of the banks are saying, well, we're not lending because there's not as much demand out there. There are a lot of small businesses that are hungry for loans out there right now.

And we've made progress but they're still struggling, so I've proposed additional ideas to help small businesses start up and hire, to raise wages and expand and get the credit they need to stay afloat. You've made some of these same proposals as well. We should put them into action without delay. We've invested in America's infrastructure, rebuilding roads and bridges and ports and railways and putting people to work strengthening our communities and our country. As you know, the Recovery Act was designed so that a lot of that work is going to be taking place this year, not just last year. Many of the projects you funded come on line in the next six months, but we can do more and we should do so without delay.

Through the investments you made in clean energy startups we've not only helped put Americans to work, we're on track to double our nation's capacity to generate renewable energy over the next few years. I proposed additional tax credits that will promote private sector hiring and energy conservation. We should do that without delay.

I think ideas like this should be pretty palatable to the other party. They seem pretty common sense, pretty centrist. We should be able to hear their ideas as well. That's why I spoke to the Republican caucus last Friday. I think it was to the country's benefit that we had an open and frank discussion about the challenges facing the American people and our ideas to solve them. I've got to admit I had a little fun at that caucus.

Now, obviously on some issues we didn't agree. But on some we did and I'm reminded that when it came to health insurance reform in particular, I sought out and supported Republican ideas from the start. So did you. Max Baucus, where's Max? I think he can testify to spending a little time listening to Republican ideas.

So can Chris Dodd and Tom Harkin. You considered hundreds of Republican amendments and incorporated many of their ideas into the legislation that passed the Senate. So when I start hearing that we should accept Republican ideas, let's be clear, we have. What hasn't happened is the other side accepting our ideas. And I told them I want to work together when we can, and I meant it.

I believe that's the best way to get things done for the American people. But I also made it clear that we'll call them out when they say they want to work with us and we extend a hand and get a fist in return. Last week, for example, you put up for a vote a bill I supported, Conrad, Gregg, fiscal commission. We were assured this was going to be bipartisan, only to see seven Republican who co-sponsor the idea in the first place suddenly decide to vote against it.

Now, I'm open to honest differences of opinion, but what I'm not open to is changing positions solely because it's good short-term politics. What I'm not open to is a decision to stay on the sidelines and then assign blame. I have little patience for the kinds of political calculations that says the cost of blocking everything is less than the cost of passing nothing.

It basically says if you lose, I win. That's been the politics in Washington for too long and the problem is it leaves the American people out of the equation. So I would just suggest to this caucus if anybody is searching for a lesson from Massachusetts, I promise you the answer is not to do nothing. The American people are out of patience with business as usual. They're fed up with the Washington that has become so absorbed with who's up and who's down that we've lost sight of how they're doing. They want us to start worrying less about keeping our jobs and more about helping them keep their jobs. They want to see their business done in an open and transparent way. When we took back the Senate in 2007 we did so in part because we made a case that we'd be better on ethics and transparency.

We backed that up bypassing the most sweeping ethics reform since Watergate and by beginning to address earmark abuse. We should be proud of those accomplishments, but if we're going to erase that deficit of trust that I mentioned at the "State of the Union," we're still going to have to do more.

That's why I've proposed that we work together to make all earmark requests public on one central web site before they come up for a vote and to require lobbyists to discuss details of their contacts on behalf of their clients with the administration or with Congress. That's why working with people like Dick Durbin who's been vocal on this for a long time, we've got to confront the gaping loophole that the Supreme Court recently opened in our campaign finance laws that allowed special interests to spend without limit to influence American elections.

We've also got to get back to fiscal responsibility and I spoke about this in the "State of the Union." Just 10 years ago America had a budget surplus of over $200 billion. Remember people were worried about what might happen with all these surpluses. And whether it would create problems in the financial markets. That was just a decade ago.

After two wars, two tax cuts, prescription drug program, none of which were paid for, we faced a deficit of over a trillion dollars, a debt over the next decade of $8 trillion before my administration spent a single dollar. Now, we can't change the past, but we can change the future, and that's why I'm asking you to adopt a freeze in non-security discretionary spending for the next three years, starting next year. We're still having a tough time right now, given the economy is just starting to pick up steam but starting next year.

That's why I'm grateful that all of you restored the PAYGO rules that worked so well in the 1990s. I already mentioned the fiscal commission. We may not have been able to get the votes for a statutory commission, but we're going to - I am going to appoint a commission by executive order because it's important for us to take these issues seriously. Not just for us, but for our children and our grandchildren.

Let me just wrap up by saying this. I know these are tough times to hold public office. I'm there in the arena with you. The need is great. The anger and the anguish are intense. The economy is massive and so as a consequence no matter what levers and buttons we press, sometimes it doesn't move as quickly as needed to provide relief to so many of our constituents. In that kind of circumstance, I think the natural political instinct is to tread lightly, keep your head down and to play it safe. I've said this before to this caucus and I just want to say it again. For me, it is constantly important to remind myself why I got into this business in the first place. Why I'm willing to be away from my family for big stretches at a time. The financial sacrifice that say so many of you have made, being subject to criticism constantly.

You don't get in this for the fame. You don't get in it for the title. You get in it because somewhere in your background at some point in time you decided there was an issue that was so important that you were willing to stand up and be counted. You were going to fight for something.

And you decided you were going to run as a Democrat because there was a core set of values within the Democratic Party about making sure that everybody had a fair shot, making sure that middle class folks were treated fairly in our economy, making sure that those who were on the outside had a way in that led you to get involved in public service.

And that's what we have to remind ourselves. Especially when it's hard, especially when it's hard. You look at an issue right now like health care. So many of us campaigned on the idea that we were going to change this health care system. So many of us looked people in the eye who had been denied because of a pre-existing condition or just didn't have health insurance at all or small business owners in our communities who told us that their premiums had gone up 25 percent or 30 percent and we said we were going to change it.

Well, here we are with a chance to change it. And all of you put extraordinary work last year into making serious changes that would not only reform the insurance industry, not only cover 30 million Americans but would also bend the cost curve and save a trillion dollars on our deficits according to the Congressional Budget Office.

There's a direct link between the work that you guys did on that and the reason that you got into public office in the first place. And so as we think about moving forward, I hope we don't lose sight of why we're here. We've got to finish the job on health care. We've got to finish the job on financial regulatory reform. We've got to finish the job - we've got to finish the job, even though it's hard.

And I'm absolutely confident that if we do so in an open way, in a transparent way, in a spirit that says to our political opponents that we welcome their ideas, we are open to compromise but what we're not willing to do is to give up on the basic notion that this government can be responsive to ordinary people and help give them a hand up so they can achieve their American dreams.

We will not give up that ideal. If that's where we go, I'm confident that politics in 2010 will take care of themselves. Harry, thank you very much. Let me - let me turn it over to questions. Thank you. Thank you.

(APPLAUSE) SEN. HARRY REID (D-NV), MAJORITY LEADER: The first question, Arlen Specter. Let me tell everyone, people have come to me and indicated they wanted to ask questions. I've taken a list of those. Arlen Specter is first.

SEN. ARLEN SPECTER (I), APPROPRIATIONS CMTE.: Mr. President, I begin by applauding your decision to place the economy at the top of the agenda, to put America back to work and to provide jobs, jobs, jobs. I have a two-part question and just a brief statement of the issue.

We have lost 2,300,000 jobs as a result of the trade imbalance with China between 2001 and 2007. The remedies to save those jobs are very ineffective. Long delays, proceedings before the International Trade Commission subject to being overruled by the president. We have China violating international law with subsidies and dumping. Really a form of international banditry.

They take our money and then they lend it back to us and own now a big part of the United States. The first part of my question is would you support more effective remedies to allow injured parties, unions which lose jobs, companies which lose profits by endorsing a judicial remedy if not in U.S. courts, perhaps in an international court and eliminate the aspect of having the ITC decisions overruled by the president, done four times in 2003 to 2005 at a cost of a tremendous number of jobs on the basis of the national interest.

And if we have an issue on the national interest, let the nation pay for it as opposed to the steel industry or the United Steel Workers. And the second part of the question related is when China got into the World Trade Organization, a matter that 15 of us in this body opposed, there were bilateral treaties and China has not lived up to its obligations to have its markets open to us but take our markets and take our jobs.

Would you support an effort to revise, perhaps even revoke that bilateral treaty which gives China such an unfair trade advantage? Thank you.

OBAMA: Arlen, I would not be in favor of revoking the trade relationships that we've established with China. I have shown myself during the course of this year more than willing to enforce our trade agreements in a much more serious way.

And at times I've been criticized for it. There was a case involving foreign tires that were being sent in here and I said this was an example of where we've got to put our foot down and show that we're serious about enforcement, and it caused the usual fuss at the international level, but it was the right thing to do.

Having said that, I also believe that our future is going to be tied up with our ability to sell products all around the world and China is going to be one of our biggest markets, and Asia is going to be one of our biggest markets. And for us to close ourselves off from that market would be a mistake. The point you're making, Arlen, which is the right one, is it's got to be reciprocal. So if we have established agreements in which both sides are supposed to open up their markets, we do so and then the other side is imposing a whole set of non-tariff barriers in place. That's a problem and it has to be squarely confronted.

So the approach that we're taking is to try to get much tougher about enforcement of existing rules, putting constant pressure on China and other countries to open up their markets in reciprocal ways. One of the challenges that we've got to address internationally is currency rates and how they match up to make sure that our goods are not artificially inflated in price and their goods are artificially deflated in price. That puts us at a huge competitive disadvantage.

But what I don't want to do is for us as a country or as a party to shy away from the prospects of international competition, because I think we've got the best workers on earth, we've got the most innovative products on earth, and if we are able to compete on an even playing field, nobody can beat us. And by the way, that will create jobs here in the United States.

If we just increased our exports to Asia by a percentage point, by a fraction, it would mean hundreds of thousands, maybe millions of jobs here in the United States. And it's easily doable. And that's why we are going to be putting a much bigger emphasis on export promotion over the next several years.

And that includes, by the way, export promotion not just for large companies but also for medium-size and small companies because one of the challenges -- I was up in New Hampshire yesterday. And you saw this terrific new company that had just been starred up. It's only got 13, 14 employees at this point. But it has a new manufacturing technique for the component parts in LED light bulbs, potentially could lower the price of LED light bulbs, cut them in half.

And these folks, they potentially could market not just here in the United States, but this is a technology that could end up being sent all around the world. But they don't have the money to set up their own foreign office in Beijing to navigate through the bureaucracy. They have got to have some help being over there.

So, that's one of the things that we really want to focus on in this coming year is making sure that our export-import banks, our trade offices, that we are assisting not just the big guys, although we do want to help them, but also the medium-size and small businesses that have innovative products that could be marketed if they just got a little bit of help and a little bit of push from the United States government.

UNIDENTIFIED MALE: Senator Michael Bennet, Colorado.

SEN. MICHAEL BENNET (D), COLORADO: Thanks for coming, Mr. President, it's good to see you. You talked in the State of the Union very well about a number of the challenges that we face as a country, which are serious.

I mean, even before we were driven into the worst recession since the Great Depression, the last period of economic growth in this country's history is the first time middle class family income actually fell during a period of economic growth, no net jobs created since 1998. Household wealth the same at the end of the decade as it was at the beginning. And an education system that's not working well enough for our kids. On top of everything else, you've got a $1.4 trillion deficit and $12 trillion of debt.

I was saying that the other way, by the way, in Colorado and talking about how our kids were going to have to pay this back if we didn't make this decision that we've got to face up to. My daughter, Caroline, who's ten was there, and she walked out with me at the end and she said just so you know, "I'm not paying that back."

(LAUGHTER)

BENNET: She has the right attitude, I think.

OBAMA: Just in case you're counting on it.

BENNET: But at the same time this place looks broken to the American people. The ability -- our ability to make these decisions is open to enormous question in the wake of the health care discussion in particular.

I had a woman the other day in Glenwood Springs, Colorado, asked me where she could get her lobbyist in Washington, D.C. What are we going to do differently, what are you going to do differently, what do we need to do differently as Democrats and Republicans to fix this institution so that our democracy can actually withstand the tests that we're facing right now?

OBAMA: Let me just make a couple of observations. Having served in the Senate and now seeing it from the perspective of the White House.

First of all, whenever people ask me why isn't Washington working, I am a fierce defender of the integrity and hard work of individual members. Which is, by the way, matched up by when you look at polls. People hate Congress, but individual members, a lot of them feel are really working hard on their behalf.

So, the problem here you've got is an institution that increasingly has not adapted to the demands of a hugely competitive 21st century economy. I think the Senate in particular, the challenge that I gave to Republicans and I will continue to issue to Republicans is if you want to govern, then you can't just say no. It can't just be about scoring points. There are multiple examples during the course of this year in which that's been the case.

Look, I mentioned the filibuster record. We've had scores of pieces of legislation in which there was a filibuster, cloture had to be invoked, and then ended up passing 90-10 or 80-15. And what that indicates is a degree to which we're just trying to gum up the works instead of getting business done. That is an institutional problem.

In the Senate, the filibuster only works if there is a genuine spirit of compromise and trying to solve problems as opposed to just shutting the place down. If it's just shutting the place down, then it's not going to work. That's point number two.

Point number two, in terms of how we operate, we as Democrats, I do think that the more open we are, the more transparent we are, the more people know exactly how things are working, even if sometimes it takes longer to maintain that transparency, the better off we are.

And I think the health care bill is a perfect example. I mean, the truth of the matter is, is that the process looked painful and messy, but the innumerable hearings that were held did give an opportunity for the product to get refined so that, I think that the ultimate package after potential negotiations between the House and the Senate is better than where we started. And there was a possibility and continues to be a possibility to be in discussions with the American people about what exactly that bill accomplishes.

On the other hand, and I take some fault for this, at the end of the process when we were fighting through all these filibusters and trying to get it done quickly so that we could pivot and start talking about other issues that were so important to the American people, some of that transparency got lost. And I think we paid a price for it.

And so it's important I think to constantly have our cards out on the table. And welcome challenges and welcome questions. If the Republicans say that they can ensure every American -- they can insure every American for free, which was what was claimed the other day at no cost, I want to know. Because I told them, I said, why would I want to get a bunch of lumps on my head doing the hard thing if you've got the easy thing?

But you've got to show me. You've got to prove to me that it actually works, because I've talked to every health care expert out there, and it turns out if you want to reform the insurance system, if you want to make sure that people without pre-existing conditions are able to get insurance, if you want to provide coverage for people, if you want to bend the cost curve, then you need a comprehensive bill. Because this is a complicated area involving one-sixth of our economy.

But we should be open to that dialogue. And not underestimate the power of the American people over time, despite millions of dollars of advertising to the contrary from the insurance industry and others, we should not underestimate the American people's willingness to say, okay, I've got it. And there's still going to be disagreements. Some will disagree with us. But we've got to constantly make our case, I think, and not play an insider's game. Play an outsider's game.

The last point I would make about this. You know what I think would actually make a difference, Michael? I think if everybody here, excuse all the members of the press who are here, if everybody here turned off your CNN, your Fox, your -- you know, just turn off the TV, MSNBC, blogs, and just go talk to folks out there instead of being in this echo chamber where the topic is constantly politics.

The topic is politics. It is much more difficult to get a conversation focused on how are we going to help people than a conversation about how is this going to help or hurt somebody politically. And that's part of what the American people are just sick of. Because they don't care, frankly, about majorities and minorities and process and this and that. They just want to know are you delivering for me.

And we've got to, I think, get out of the echo chamber. That was a mistake that I think I made last year was just not getting out of here enough. And it's helpful when you do.

(APPLAUSE)

OBAMA: All right.

UNIDENTIFIED MALE: Mr. President, you've told me, suggested, don't pay any attention to the blogs, don't listen to talk radio, don't watch cable TV, and I follow that advice pretty good.

(LAUGHTER)

UNIDENTIFIED MALE: Next question will be from the chair of our Agriculture Committee, the senator from Arkansas, Blanche Lincoln.

SEN. BLANCHE LINCOLN (D), ARKANSAS: Me neither, Mr. President. I stay away from the TVs and everything else. But thank you so much for being here with us today and I want to thank you also, I had a opportunity with several of my colleagues from the House and Senate to have a bipartisan meeting yesterday with the first lady on childhood obesity. It was a great meeting, and we look forward to working with her and you and your administration to really tackle that problem on behalf of our children and the future of our country.

Mr. President, I come from a seventh generation Arkansas family. My dad was a good Democrat, and he was a great Arkansasan. And he was very typical of Arkansans in that he was very independent minded, as am I, and as are most of our constituents. He used to tell me early on when I ran for Congress, he said it's really results that count.

And as I look at what's going on in my state and among my constituents, I visited with a constituent yesterday, good Democrat, small business owner, who was extremely frustrated. Extremely frustrated because there was a lack of certainty and predictability from his government for him to be able to run his businesses. He and his father have worked hard, they have built three or four different small businesses. And he fears that there's no one in your administration that understands what it means to go to work on Monday and have to make a payroll on Friday.

He wants results. He wants predictability. And I think that you're exactly right, people out there watching us, they see us nothing more than Democrats and Republicans, up here fighting, fighting only to win a few political points, not to get the problem solved. And so I just -- I want to echo, I guess, some of what my colleague, Michael Bennet, from Colorado mentioned, but also to ask to you in terms of where we are going, what can we tell the people in terms of predictability and certainty in getting this economy back on track. How are we going to do that, and are we willing as Democrats, not only to reach out to Republicans but to push back in our own party for people who want extremes and look for the common ground that's going to get us the success that we need, not only for our constituents but for our country in this global community and this global economy?

Are we willing as Democrats to also push back on our own party and look for that common ground that we need to work with Republicans and to get the answers, and it's really the results that are going to count to our constituents. And we appreciate the hard work that you put into it.

OBAMA: Well, look, there's no doubt that this past year has been an uncertain time for the American people. For businesses and for people employed by businesses. Some of that certainty just had to do with the objective reality of this economy entering into a freefall.

So, let's just be -- let's remind ourselves that if you've got an economy suddenly contracting by six percent or a loss of trillions of dollars of wealth basically in the blink of an eye or home values descending by 20 percent, that that's going to create a whole lot of uncertainty out there in the business environment and among families.

And part of what we've done over the course of this year is to put a floor under people's feet. That's what the Recovery Act did. That's what the interventions and the financial markets did. It broke the back of the recession, stabilized the markets. Nobody is talking about a market meltdown at this point. And people haven't recovered all that they had lost in their 401(k)s, but they're feeling a little better when they open that envelope now than they did six months ago.

State budgets were in freefall. That was stabilized. States are still going through incredible pain, but they did not have to layoff teachers and firefighters and cops at the levels that they would have otherwise had to lay them off. That provided some stability and some certainty.

So, the steps you've taken as a Congress, the steps we've taken as an administration have helped to stabilize things.

Now, moving forward, Blanche, what you're going to hear from some folks is that the way to achieve even greater economic growth, and keep in mind the economy is not growing at a 6 percent clip, so the question is when do businesses actually start hiring because they're now making a profit. What you're going to start hearing is the only way to provide stability is to go back and do what we've been doing before the crisis.

So, I noticed yesterday when there was some hearing about our proposal to provide additional financing to small businesses and tax credits to small businesses, some of our friends on the other side of the aisle said, "This won't help at all. What you have to do is to make sure that we continue the tax breaks for wealthiest Americans. That's really what's going to make a difference."

Well, if the agenda, if the price of certainty is essentially for us to adopt the exact same proposals that were in place for eight years leading up to the biggest economic crisis since the Great Depression, we don't tinker with health care, let the insurance companies do what they want, we don't put in place any insurance reforms, we don't mess with the banks, let them keep on doing what they're doing now because we don't want to stir up Wall Street, the result is going to be the same. I don't know why we would expect a different outcome pursuing the exact same policy that say got us into this fix in the first place.

Michael Bennet articulated it very well. Part of the reason people are feeling anxious right now, it's not just because of this current crisis. They have been going through this for ten years. They have been working and not seeing a raise. Their costs have been going up. Their spouses going to the workforce. They work as hard as they can. They're barely keeping their heads above water. They're trying to figure out how to retire. They're seeing more and more of their costs on health care dumped in their lap. College tuition skyrockets. They are more and more vulnerable and they have been for the last decade, treading water.

And if our response ends up being, you know, because we don't want to -- we don't want to stir things up here, we're just going to do the same thing that was being done before, then I don't know what differentiates us from the other guys. And I don't know why people would say, boy, we really want to make sure that those Democrats are in Washington fighting for us.

So, the point I'm making -- and Blanche is exactly right. We've got to be nonideological about our approach to these things. We've got to make sure that our party understands that like it or not, we have to have a financial system that is healthy and functioning so we can't be demonizing every bank out there. We've got to be the party of business, small business and large business, because they produce jobs. We've got to be in favor of competition and exports and trade.

We don't want to be looking backwards. We can't just go back to the New Deal and try to grab all the same policies of the 1930s and think somehow they'd work in the 21st century. So, Blanche is exactly right that sometimes we get ideologically bogged down. I just want to find out what works. And I know you do, too. And I know the people of Arkansas do, too.

But when you're talking to the folks in Arkansas, you also have to remind them what works is not just going back and doing the same things that we were doing before. And, yes, there's going to be some transition time.

If we have a serious financial regulatory reform package, will the banks squawk? Yes. Will they say this is the reason we're not lending? Yes. The problem is, we know right now they're not lending. And paying out big bonuses. And we know that the existing regulatory system doesn't work.

So we shouldn't be spooked by this notion that, well, is now the time to take seriously -- in an intelligent way, not in a knee-jerk way -- the challenge of financial regulatory reform so that you don't have banks that are too big to fail and your not putting taxpayers at risk and you're not putting the economy at risk. Now's the time to do it.

The same is true with health care. The same is true with health care. There are, I promise you, at least as many small businesses out there if you talk to them who will say I just got my bill from my health insurance and it went up 40 percent. And we've got to do something for them. All right?

(APPLAUSE)

UNIDENTIFIED MALE: Next question, the junior senator from state of New York, Kirsten Gillibrand.

KIRSTEN GILLIBRAND (D), NEW YORK (off-mike): Thank you, Mr. President....

OBAMA: Here, Kirsten, we've got a mic for you.

GILLIBRAND: Thank you, Mr. President. I have an issue I'd like to raise that is very important to every New Yorker and to many, many Americans. And that's health care for our 9/11 responders and for all of the communities that live near ground zero.

Now, these Americans hail from every one of the 50 states and every single congressional district in the entire United States. And now because of exposure to toxins from the collapse of the World Trade Center towers, there's about 20,000 people who are sick. Some of them gravely ill, suffering from serious health effects. Some are disabled, some have died.

I've introduced legislation to provide permanent care and proper compensation for these Americans. And my question is would you today commit to working with Congress to pass comprehensive 9/11 -- a comprehensive 9/11 health bill that's fully paid for?

OBAMA: Well, I fully commit to working with you guys. Keep in mind that our budget already significantly increased funding precisely for this purpose. So, I'm not just talking the talk, you know. We've been budgeting this as a top priority for the administration.

I confess, Kirsten, I have not looked at all the details of your legislation, but I know that not only you and Chuck but everybody here wants to make sure that those who showed such extraordinary courage and heroism during 9/11, that they are fittingly cared for and that's going to be something that we are going to be very interested in working with you on. All right?

GILLIBRAND: Thank you, Mr. President.

(APPLAUSE)

UNIDENTIFIED MALE: The next question is the chairperson of the Environment Public Works Committee, Senator Barbara Boxer.

OBAMA: Hey, Barbara Boxer.

SEN. BARBARA BOXER (D), CALIFORNIA: Great to see you here, Mr. President. Thanks for doing this and thanks for meeting with the Republican caucus at the house. I thought it was very instructive for the American people.

As Senator Feinstein and I tell our colleagues every day, California is hurting. I think -- I know that you're aware of that. And they really want to see a fighting spirit in us, that we are committed, even though we've had some political setbacks, to get the job done. And I just want to tell you as I watched you during the State of the Union, listened to you, what you are doing now is really important to the folks that I represent because you're showing that fighting spirit no matter what the adversity is, and you're coming up with specific proposals.

So, I want to ask you about small business. We all know they're the job creators. Sixty-four percent of new jobs over the last 15 years came from small business. Your new proposal, which does mirror a couple of people -- I look at Senator Merkley (ph), I know Senator Warner and others, we've worked hard on this.

For community banks to lend -- can you do that by executive order, because my understanding is you can use some of the T.A.R.P funds that were paid back and use -- or those funds that have not been used, can you use that and get this going by executive order or do you need us to put that program into a jobs bill?

And second, are you using your influence as much as you can to get the big banks to lend? They have dropped lending by $12 billion over the last year. So, I wonder if you can give us an update on that.

OBAMA: First of all, you know, I have now taken trips to Allentown, Pennsylvania, Elyria, Ohio, most recently...

AUDIENCE MEMBERS: Baltimore.

OBAMA: I was in Baltimore.

(LAUGHTER)

OBAMA: Had a great time in Baltimore. Just recently, Nashua, New Hampshire. Haven't been to Searchlight yet, but we're going to get there.

And everywhere I go, you talk to small business and they will tell you they are still experiencing a severe credit crunch. The larger businesses right now are able to get financing. Even the medium-sized businesses, the credit markets have improved. Smaller businesses, even if they are making a profit and have not missed a payment are finding that banks are adverse to providing them capital.

Now, two reasons that they cite. One is they say their bankers are telling them that the regulators are just looking over their shoulder too much, and so the community banks feel that their hands are tied. These are independent regulators. They are diligent in doing their jobs. Obviously, they feel caught off guard because of the lax regulation in some cases of the banking industry before the financial crisis. You get a sense that the pendulum has swung too far in the other direction.

The challenge that we've got is we've got to be careful because these are independent regulators, and we don't want to politicize them. But what Treasury Secretary Geithner and others have done is to discuss with the regulators what we are hearing in the field, and to make sure that there is a consistency of approach that doesn't prevent banks from making what are good loans and taking reasonable risks. So, that's one thing we're hearing.

The other thing, though, that is still out there is that the larger banks generally haven't been in this market. A lot of the smaller companies never had access to them in the first place, and we want to actually see if we can get more of those large banks to get into this marketplace. When I met with the big bank CEOs this was something that I pushed them on. They tell me, and we have seen some confirmation of this, that they are actually ramping up some of their small business lending and setting up more aggressive divisions actively seeking out loans. So, that's the effort that we're making to jawbone the private sector to do what it needs to do.

In the meantime, you mentioned the specific proposals that say we put forward. I do think it's better to do them through legislation than through executive order. T.A.R.P. was a congressionally created structure with some fairly stringent guidelines in terms of how we were supposed to approach it.

It shouldn't be hard to do, though. It's a pretty simple concept. Banks have repaid money. There's $30 billion that we could take that has already been repaid, immediately apply that to a fund so that small banks or community banks are able to provide their small business customers with greater lending.

And, you know, I do think that getting that as part of a jobs package is priority number one. I know I've already talked to Harry about this. My assumption is that if you combine that with the tax credits that we put in place for hiring, the provisions that we talked about to incentivize weatherization program that can immediately start hiring people to retrofit homes and businesses and help reduce our energy costs, taking some of those immediate steps now, I think, will pay big dividends down the road.

And the timing of it is perfect. Our job last year was to make sure the economy was growing. The economy is now growing. But what's happening is businesses either because they can't find financing or because they're still just dipping their toe in the water have been hesitant to hire full-time workers. And for us to start giving them some serious incentives, giving them additional access to financing could accelerate a process that otherwise could take a much longer time and, frankly, all those folks out there who are out of work right now, they just can't afford to wait any longer.