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President Obama, President Karzai Address Media

Aired May 12, 2010 - 12:05   ET

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

(JOINED IN PROGRESS)

QUESTION: Thank you very much.

First off all, thank you very much, Mr. President, to give us a chance. There is a lot of issues in Afghanistan, as long as I remember.

First of all, I'm sorry. I should introduce myself.

My name is Nazita Azim Kadami (ph). I'm a correspondent for Ariana Television from Afghanistan.

Today I'm not talking about as a journalist, as a woman in Afghanistan. As long as I remember, regarding Afghanistan's situation, the only reason that Afghanistan is not stabilized, Pakistan.

You mentioned, President Obama, about Pakistan. Pakistan has two faces regarding Afghanistan. That's why all the time we have problems, as Pakistan's government is not really, really honest regarding Afghanistan.

I need your answer, what is the new policy of United States to solve this problem?

And next question for President Karzai, I want to ask my question in Dari, and then I want to answer it in Dari, too.

(SPEAKING DARI)

Thank you.

OBAMA: OK. I know you're going to translate that for us.

(LAUGHTER)

OBAMA: He's very good at that.

QUESTION: Yes, civilians will (ph), too.

OBAMA: President Karzai and I have, in the past, met with Pakistan's president, President Zardari, as well as their intelligence officers, their military, their teams, and emphasized to Pakistan the fact that our security is intertwined. I think there has been, in the past, a view on the part of Pakistan that their primary rival, India, was their only concern. I think what you have seen over the last several months is a growing recognition that they have a cancer in their midst, that the extremist organizations that have been allowed to congregate and use, as a base, the frontier areas to then go into Afghanistan, that that now threatens Pakistan's sovereignty.

Our goal is to break down some of the old suspicions and the old bad habits and continue to work with the Pakistani government to see their interests in a stable Afghanistan which is free from foreign meddling and that Afghanistan, Pakistan, the United States, the international community should all be working to reduce the influence of extremists in those regions. And I am actually encouraged by what I have seen from the Pakistani government over the last several months. But just as it's going to take some time for Afghanistan's economy, for example, to fully recover from 30 years of war, it's going to take some time from Pakistan, even where there is a will, to find a way in order to effectively deal with these extremists in areas that are fairly loosely governed from Islamabad.

You know, part of what I've been encouraged by is Pakistan's willingness to start asserting more control over some of these areas, but it's not going to happen overnight. And they have been taking enormous casualties, the Pakistani military has been going in fairly aggressively. But this will be an ongoing project.

And President Karzai and I both discussed the fact that the only way, ultimately, that Pakistan is secure is if Afghanistan is secure. And the only way that Afghanistan is secure is if the sovereignty, the territorial integrity, the Afghan constitution, the Afghan people are respected by their neighbors. We think that that message is starting to get through, but it's one that we have to continue to promote.

KARZAI: Ma'am, we did discuss civilian casualties, the protection of civilians. I must report to you, ma'am, that since the arrival of General McChrystal in Afghanistan, there has been considerable progress achieved in this regard.

There is very open and frank attitude about that now. The president expressed in fundamentally human terms his concern about civilian casualties, not only as a political issue, but as a human issue that President Obama remarked about, to which I have my respect to the president on this issue.

We not only discussed the ways and means of how to reduce civilian casualties, but rather not have them at all. Nitrates (ph) were discussed and potentials (ph) were discussed. I made a remark about it in my opening remarks, and you will see the agreements between us on this reflected in the joint communique that I hope is coming up or is already issued.

Mr. President.

OBAMA: Suzanne Malveaux.

SUZANNE MALVEAUX, CNN WHITE HOUSE CORRESPONDENT: Thank you, Mr. President. With the thousands of U.S. troops and billions of dollars in aid that still pour into Afghanistan, can you talk to the American people and give us a sense of where we stand, how close we are to winning this war in Afghanistan, and whether or not you'll be able to meet your goal of pulling out the majority of U.S. troops by July of 2011?

And to President Karzai, is there anything that you can do, your government or your people, to maintain that deadline, that end game of July 2011? And have you found your meetings with Iran's president, Mahmoud Ahmadinejad, to be helpful or hurtful in your relationship with the Obama administration?

Thank you.

OBAMA: Well, Suzanne, first of all, let's be clear about what July, 2011 represents.

What I have said is that having put in more troops over the last several months in order to break the momentum of the Taliban, that beginning in 2011, in July, we will start bringing those troops down and turning over more and more responsibility to Afghan security forces that we are building up. But we are not suddenly, as of July, 2011, finished with Afghanistan.

In fact, to the contrary, part of what I've tried to emphasize to President Karzai and the Afghan people, but also to the American people, is that this is a long-term partnership that is not simply defined by our military presence. I am confident that we're going to be able to reduce our troop strength in Afghanistan starting in July 2011, and I am in constant discussions with General McChrystal, as well as Ambassador Eikenberry, about the execution of that time frame.

But after July 2011, we are still going to have an interest in making sure that Afghanistan is secure, that economic development is taking place, that good governance is being promoted. And so we're going to still be putting in resources, and we're still going to be a friend to the Afghan people in their efforts to stabilize. So, that's something I want to make absolutely clear.

Now, to the American people, I think what they should know is, is that we are steadily making progress. It's not overnight, it's not going to be instant. But the sacrifices of those young people that President Karzai visited at Walter Reed, those sacrifices result over time in more and more of Afghanistan being under the control of the Afghan government, and our friend and ally, President Karzai, and less and less under the control of the Taliban.

As I indicated in my opening remarks, this is not just going to be a military solution. And so through the Peace Jirga that President Karzai is organizing, through the Kabul Conference that sends a strong message about the Afghan's commitment to rule of law and good governance and human rights and women's rights, through all those mechanisms, more and more of the Afghan people start feeling confident in the Afghan government. And as their confidence in the Afghan government grows, their fear of the Taliban weakens. And we are confident that that approach that has a strong military component to it, that is mindful of the enormous sacrifices that our troops and their families are making, that component is critical, but these other components are going to be critical as well. And if we marry those two approaches, then we are optimistic about success.

But there are going to be ups and downs. And one thing that I've tried to emphasize is the fact that there's going to be some hard fighting over the next several months.

The fact that we are engaging -- you look at a place like Marjah, the Taliban controlled that area. And when you move in and you say you're not controlling this area anymore, they're going to fight back. And they're tough, and they're going to fight.

But what you're seeing, not only have we succeed in driving the Taliban out of Marjah, but it also is a model of the partnership between U.S. forces and Afghan forces. And so you're starting to see Afghan government forces battle-ready, toughened, getting more experience. That, then, helps us to execute a transition so that more and more Afghan forces are able to take the lead. But it -- but this is going to be -- this is going to be taking some time.

One last point I want to make, because President Karzai referred to the issue of civilian casualties, the Afghan journalist asked about it. Let me be very clear about what I told President Karzai.

When there is a civilian casualty, that is not just a political problem for me. I am ultimately accountable, just as General McChrystal is accountable, for somebody who is not on the battlefield who got killed. And that is something that I have to carry with me and that anybody who is involved in the military operation has to carry with them. And so we do not take that lightly.

We have an interest in reducing civilian casualties not because it's a problem for President Karzai. We have an interest in reducing civilian casualties because I don't want civilians killed. And we are going to do everything we can to prevent that.

Now, war is tough and difficult, and mistakes are going to be made. And our troops put themselves at risk oftentimes in order to reduce civilian casualties. They will take a chance often in a field of battle where they're trying to deal with uncertain information and they're not sure whether that's an attack coming or not, or which house these shots are being fired from.

And because of General McChrystal's direction, oftentimes they're holding fire, they're hesitating, they're being cautious about how they operate, ,even though it would be safer for them to go ahead and just take these locations out, because part of what the American military stands for is that we distinguish between civilians and combatants. Something, by the way, that our enemies do not do.

And that puts us more at risk and it makes it more difficult. But that's a burden that we're willing to bear. But I want everybody to be clear, especially the Afghan people. I take no pleasure in hearing a report that a civilian has been killed. That's not why I ran for president. It's not why I'm commander-in-chief. That's not why our young men and women sign up. That's not why they sacrifice in the ways that President Karzai saw they sacrifice when they're in Walter Reed. And we are going to work together as well as assiduously as we can to make sure that no civilian casualties are reduced, even as we try to accomplish a mission and even as we are reminding ourselves constantly that the overwhelming majority of civilian casualties in Afghanistan are as a consequence of terrorist acts by the Taliban.

President Karzai.

KARZAI: Ma'am, on the -- July 2011, Afghanistan's army and police are progressing steadily towards strengthening and towards institutionalizing. We plan to be conducting, providing security for our country in major parts of the country where we have the ability within the next two years. And by the time my term of office completes in four years, four and a half years from today, Afghanistan is working hard to provide security for the whole of the country, through the Afghan means and Afghan security institutions. On the overall picture, President Obama spoke for both of us on the issue of July, 2011.

On the question of Iran and my meeting with President Ahmadinejad in Tehran, and his visit to Kabul, Afghanistan's position there is very clear, from the very first day. And we have been clear with our brothers and counterparts in Iran on that as well, and with our other neighbors.

Afghanistan is a partner and a friend with the United States. The United States is our greatest contributor to stability and reconstruction as the provider of nearly 80 percent of the support that Afghanistan receives. And Afghanistan's desire to engage in a strong, steady, long-term relationship with America is one that we have expressed clearly and publicly and repeatedly.

We have also spoken with our American counterparts from the very begin that Iran is our neighbor and a brother, and we want to have the best of relations with them. They have had contributions to Afghanistan's reconstruction. We wish that Afghanistan remains friendly to both and is not a place where we are seen as a playground by our neighbors in any way.

So, the United States has been very clear and supportive and understanding of the Afghan position, and this has been reflected in the discussions between us and in the declaration, the joint communique. There was a reference to Afghanistan having friendly relations with its neighbors, and Iran is one of our neighbors. But we are distinct and clear on our relation with America and with Iran as well. We wish both countries the best, and if there is anything we can do to make things better, call us.

(LAUGHTER)

KARZAI: Ma'am?

QUESTION: (INAUDIBLE), Afghanistan Service with South America.

I will ask President Karzai a question and then President Obama.

KARZAI: South America's Afghanistan Service?

QUESTION: Yes.

KARZAI: Good.

QUESTION: Thank you.

One of your purposes of your trip here to gain at the support of U.S. government for reconciliation and reintegration of Taliban in Afghanistan, when you first initiated this strategy or plan, you were interested in talks with lower-to-middle level of Taliban, but you have increasingly shown interest into bringing Taliban leaders into the negotiations. While Taliban made it very clear that the only way for them to talk to the Afghan government is a complete withdrawal of foreign troops from Afghanistan, and the creation of a (INAUDIBLE) government in that country, are you sure that this is strategy, after all the support that you will gain from the international community, will be a successful one and will not be yet another failed strategy in Afghanistan?

And my question for President Obama would be that, Secretary Clinton, yesterday, mentioned in a gathering that U.S. supports this initiative only if the Taliban put their weapons down, respect the Afghan constitution, and cut all ties with al Qaeda. And we all know that Taliban, al Qaeda are pretty much fighting for the ideology, not material gains, and it's very hard to differentiate between the two in Pakistan and Afghanistan since they are fighting as a united force in those countries.

Do you think it's a doable strategy for Afghanistan?

Thank you.

KARZAI: Ma'am, exactly the last part of your question is my answer. Afghanistan is seeking peace, because through military means alone we are not going to get our objectives of bringing stability and peace to Afghanistan and the defeat of terrorism.

Now, there are thousands of the Taliban who are not ideologically-oriented, who are not part of al Qaeda. All other terrorist networks, all controlled from outside in any manner troublesome to us.

There are thousands of them who are country voice, who have been driven by intimidation or fear caused by, at times, misconduct by us or circumstances beyond their control or our control. It is these thousands of Taliban who are not against Afghanistan or against the Afghan people or their country, who are not against America either, or the rest of the world, and who want to come back to Afghanistan if given an opportunity and provided the political means. It is this group of the Taliban that we are addressing in the Peace Jirga. It is this group that has our attention.

Those within the Taliban leadership structure who, again, are not part of al Qaeda or the terrorist networks or ideologically against Afghanistan's progress and rights and constitution, democracy, the place of women in the Afghan society, the progress that they have made, and are willing to march ahead with their -- the rest of their people and their country towards a benefit of Afghanistan, are welcome. And the jirga, the Peace Jirga, is intended for consulting the Afghan people, taking their advice on how and through which means and which speed should the Afghan government proceed in the quest for peace.

OBAMA: Well, I think President Karzai summed it up well.

We've been very clear that we need, ultimately, a political component to our overarching strategy in Afghanistan. And as President Karzai described, the "Taliban" is a loose term for a wide range of different networks, groups, fighters with different motivations.

What we have said is that, so long as there's a respect for the Afghan constitution, rule of law, human rights, so long as they are willing to renounce violence and ties to al Qaeda and other extremist networks, that President Karzai should be able to work to reintegrate those individuals into Afghan society. This has to be an Afghan-led effort, though. It's not one that's dictated by the United States or any other outside power. And I think that the Peace Jirga will allow for a framework to then move forward.

One of the things I emphasized to President Karzai, however, is that the incentives for the Taliban to lay down arms, or at least portions of the Taliban to lay down arms, and make peace with the Afghan government, in part, depends on our effectiveness in breaking their momentum militarily. And that's why we put in the additional U.S. troops. That's why General McChrystal is working so hard to clear out key population centers from Taliban control.

And so, the timing, how the reconciliation progress works, at what point do the Taliban start making different calculations about what's in their interests and how the Afghan people feel about these issues, is in part going to be dependent on our success in terms of carrying out our mission there. So, we are very, I think, an important partner in facilitating this potential reconciliation and effectively empowering the Afghan government so that it is in the strongest possible position as these talks move forward.

Let me just say in conclusion, again, Mr. President, I'm grateful for your visit. This is a reaffirmation of the friendship between the American people and the Afghan people.

When I came into office, I made it very clear that, after years of some drift in the relationship, that I saw this as a critical priority. I also said to the American people that this was going to take some time and it was going to be hard, that we weren't going to see magical transformations immediately, but with slow, steady, persistent work on the part of both the United States and the Afghan government, that I was confident that in fact we could achieve peace and stability and security there, and that ultimately would make the American people more safe and more secure.

I am more convinced than ever that we have found a difficult, but appropriate, strategy for pursuing those goals.

And I'm confident that we're going to be able to achieve our mission.

There are going to be setbacks. There are going to be times where the Afghan government and the U.S. government disagree tactically, but I think our overarching approach is unified. And I think that the visit by President Karzai to the United States and his willingness to listen to our concerns even as we listen to his, as he indicated, only makes the relationship stronger.

Thank you very much, everybody.

KARZAI: Thank you --

(CROSSTALK)

OBAMA: Thank you.

(APPLAUSE)

TONY HARRIS, CNN ANCHOR: There you have it. President Obama promising solidarity with the people of Afghanistan, in spite of difficult days in the past and certainly more difficult days to come. And perhaps that is the important point to take from all of this. There are plenty of political and security issues remaining for these two leaders to work out, but President Obama assuring the Afghan people that the United States is with them.

I want to get to something that we've just received into the CNN NEWSROOM. Chad Myers is here to help me understand what we're seeing here. We've gotten some pictures -

CHAD MYERS, AMS METEOROLOGIST: Yes.

HARRIS: A couple of pictures from BP.

MYERS: Hard to get pictures.

HARRIS: Difficult to get.

MYERS: Hard to find. Yes.

HARRIS: We've been talking about whether or not BP could have been a little more forth coming with some of the video that it has of this spill, right there at the wellhead on the floor in the Gulf.

MYERS: Right.

HARRIS: But we've got a couple of stills and you can help us sort through this.

MYERS: We do. We do. And I think now we know why they didn't want to show it. Although it is dark, the bottom, across the center of your screen back over toward the letters CNN, that's the pipe. And then the black part that you see over there on the right, that's the oil spewing out. Go to the other one and you can begin to see it a little bit better. The pipe there. And then you see the - kind of the ashy smoke look and stuff. Looks like it's smoke coming out of there. Well, clearly we know it's not smoke.

HARRIS: Yes.

MYERS: Now something we do know today that is brand new is that there's more natural gas coming out of the well today than there has been. That's good.

HARRIS: Yes. Yes.

MYERS: Because natural gas doesn't sit on top of the ocean and float and kill things.

HARRIS: Absolutely.

MYERS: Sure, it gets into the atmosphere and it's not all that good, but the atmosphere is big compared to this pollution that the oil is taking.

HARRIS: Absolutely.

MYERS: So if we can get more and more nat gas coming out of the well and less and less oil coming out of the well, that would be a good thing for the clean-up.

HARRIS: OK.

MYERS: So there's not as many gallons - not as many thousands of gallons of oil. There's only so much space can come out of that pipe, right?

HARRIS: Right.

MYERS: So if half the space is taken up with that gas and half the space is taken up with oil, that just means that it's finding its equilibrium. The well down below. The hole where the oil is. Where the, you know --

HARRIS: Right. Right.

MYERS: It's not really a hole. It's in between a -- the layers and layers of rocks.

HARRIS: Right.

MYERS: And so now we're kind of into a gas pocket. And, hey, we can stay in a gas pocket for two months, that would be amazing.

HARRIS: Wouldn't that be nice. Wouldn't that be nice.

What is the latest that you've heard on this plan to go with a smaller containment dome thing?

MYERS: They are trying to figure that out, you know?

HARRIS: I know.

MYERS: They're - I -- clearly --

HARRIS: We're with you on that (INAUDIBLE).

MYERS: Clearly the problem were the hydrates -

HARRIS: Yes. Yes.

MYERS: Coming out of it and getting clogged in the big box. We don't know whether this little box is going to have any better effect. What we think might want to happen is that -- get some kind of heater in that box to keep the oil warm.

HARRIS: Right. Right.

MYERS: And not get - and not -- the hydrates not deform (ph) because they don't - they can format at 60 degrees. It doesn't have to be freezing.

HARRIS: Right.

MYERS: Could we -- at that pressure down there. And then I've been hearing people say, they're just going to load it up with concrete and try to --

HARRIS: Trash it. Right.

MYERS: You know? And I don't believe this littler cap, this top hat will work as efficiently as the big box would have.

HARRIS: Right.

MYERS: But, hey, if we can get 60 percent off and lot, you know, not lose 100 percent, we only lose 40 percent, that would be a big gain.

HARRIS: Right.

MYERS: You know, they're grasping at straws at this point. They've tried what they can try. I - you know, I want you to go on the Internet today. I want you to go on YouTube and I want you to put on -- type in peat moss because if -- there's a company in Quebec that is shredding peat moss. You throw peat moss on a oil -

HARRIS: With this effort?

MYERS: Well, they're working on it.

HARRIS: OK.

MYERS: You take this shredded, activated peat moss.

HARRIS: Yes.

MYERS: You put it in the water. It doesn't absorb water. It only absorbs the oil. So it sits there and floats, absorbs the oil, then you skim it off and skim (ph). Now, we're not going to spread this over the entire Gulf of Mexico, but if you see it coming to Dauphin Island and all of a sudden the people of Dauphin Island take their boats out there and they shred this peat moss on it, it absorbs all the oil. You scoop it up and it doesn't make it to the beach, you win.

HARRIS: You win. That's a win. That's a clear win. All right, Chad, appreciate it.

MYERS: All right.

HARRIS: And, you know, we're going to get more answers from Washington. Brianna Keilar is there. We'll talk to her in just a couple of minutes. You're in the CNN NEWSROOM.

(COMMERCIAL BREAK)

HARRIS: All right. Welcome back, everyone, to the CNN NEWSROOM. I'm Tony Harris.

From the finger pointing to actual answers, new information is coming out of a congressional investigation into the massive oil leak in the Gulf of Mexico. Congressional correspondent Brianna Keilar following today's hearings on Capitol Hill.

And, Brianna, what are you hearing? What are you learning?

BRIANNA KEILAR, CNN CORRESPONDENT: There has been some finger pointing, Tony, but really we've been seeing this House subcommittee conducting this third BP hearing, this third oil spill hearing in two days. They're really getting to the heart of that question, what happened, what caused this disaster in the Gulf. So this House subcommittee has been conducting an investigation. Members of this committee have gone down to the Gulf. They've done a lot of interviews, collecting documents, collecting different accounts of the explosion and the events that precipitated this disaster.

And here's what we learned today during this hearing. First off, that this well, before the explosion, may have failed two crucial pressure tests. The other thing, that the safety shutoff device, that blowout preventer we've heard referred to as the BOP here in the last couple of days, was not working properly before the explosion. Listen to what Congressman Henry Waxman, who is the chairman of this full committee, said at the beginning of this hearing.

(BEGIN VIDEO CLIP)

REP. HENRY WAXMAN (D), ENERGY AND COMMERCE CHAIRMAN: Transocean, one of the world's largest operator of drilling rigs, says it has no reason to believe that the rig's fail-safe device, called a blowout preventer, was not fully operational. But we have learned from Cameron (ph), the manufacturer of the blowout preventer, that the device had a leak in a crucial hydraulic system and a defectively configured ram.

(END VIDEO CLIP)

HARRIS: Wow.

KEILAR: So a leak in the hydraulic system and, obviously, something that wasn't configured right, Tony. And we should tell you that these are, obviously, very much preliminary findings in this congressional investigation. And even members of Congress here admitting that they raised, perhaps, more questions than answers. But I think it sounds like we are getting perhaps toward some answers.

HARRIS: Yes. Yes, I think you're right.

Brianna, you said the well may have failed two crucial - I believe you said pressure tests. Why is that so important? And take some time to walk us through this.

KEILAR: Yes, and the way they explained it - they've been doing a lot of explaining in laymen's terms, very nitty-gritty details here. But the way it was explained by lawmakers and sort of getting some feedback there from these oil executives is what you do as you're testing a well, and this is something that was going on really in the hours before the explosion, you do what's called a positive pressure test, which is basically increasing the pressure within the well. You add fluids to it. It increases the pressure. You're testing the integrity of the well.

Well, so far this investigation has found that it did pass those tests. But then there's another one that's called a negative pressure test. And what you do is you decrease the pressure in the well and this would allow the ability to see if there are leaks in the well, leaks coming through the cement casings. And as it turns out, there were two of those tests that showed anomalies. And so they were asking -- the lawmakers here were asking the head of BP, the head of Transocean, what does that mean?

And what the head of BP said was, it tells you that there's something going on in the well bore that shouldn't be going on. So the question here by folks like Henry Waxman is, OK, well shouldn't that have raised the idea that maybe you should have stopped well operations?

HARRIS: Yes. Yes.

KEILAR: And ultimately at that point, despite those readings, they did not stop them.

HARRIS: Gotcha. OK. Brianna Keilar on Capitol Hill for us.

Brianna, appreciate it. Thank you.

A little extra value for you here. In environmental terms, got to tell you, 210,000 gallons of crude gushing into the Gulf every day is an awful lot. But this terms of the country's daily use of petroleum, it is barely a drop in the proverbial barrel. Here is a quick fact check for you.

Every single day, America uses roughly 19.5 million barrels, or almost 819 million gallons of oil, mostly for transportation according to the government's Energy Information Administration. In comparison, we're told, the total amount leaked into the Gulf since last month's rig explosion is about 95,000 barrels, or 4 million gallons. A small fraction of a single day's consumption. Still, the environmental impact could be with us for many years.

First, Goldman Sachs. Now, is the Justice Department looking at Morgan Stanley's role in the financial meltdown of 2008? We're back in a moment.

(COMMERCIAL BREAK)

HARRIS: Well, first it was Goldman Sachs. Now, Morgan Stanley reportedly under investigation for misleading investors. CNNMoney.com's Poppy Harlow is in New York for us.

Poppy, it's good to see you. Haven't seen you in a while.

POPPY HARLOW, CNNMONEY.COM: Good to see you too.

HARRIS: What's the allegation here?

HARLOW: Sure. I mean it's one of the stories we're following very closely on CNN Money, as you see today. And that's because there are a lot of questions, right. "The Wall Street Journal" came out with a report very early this morning saying the Department of Justice has started investigating Morgan Stanley about whether or not they misled their investors when it came to their bets on the housing market. If that sounds familiar to you, it's because that is what the SEC is investigating Goldman Sachs for.

Here is the issue, Tony. I talked to folks -- sources with inside knowledge of this, this morning. Talked to a lot of them. And all of them say they haven't heard. Morgan Stanley even said this on the record, they haven't heard from the Department of Justice or the SEC about any of these alleged investigations. They haven't conducted any interviews. They haven't asked for documents. So that's the big issue here, is whether or not there's an investigation.

However, Morgan Stanley did talk to us about the products in question. And these are, again, some of those mortgage-backed securities deals. Bets that this bank made on the housing market.

Morgan Stanley says they didn't know where the housing market was going, but they worked with two other banks -- it gets a little confusing - Citigroup and UBS, to structure these products. OK. And they were about $200 million each. And Morgan Stanley bet on them, saying we think the housing market's going to fall. OK, Tony?

HARRIS: Yes. HARLOW: Morgan Stanley made about $400 million as a result. $400 million is a lot of money, OK. But let's put this in perspective. Morgan Stanley also about $10 billion in 2007 on their mortgage bets. So just like Goldman Sachs, you have another bank, one of Goldman's main competitors, that is on both sides of the housing market, at the heart of the crisis. The question is, what are the moral implications here? Did Morgan Stanley disclose what it needed to, to all of its clients.

The CEO of Morgan Stanley, today, talking in Japan, said, listen, there's no reason to believe there's any substance to this "Wall Street Journal" article. We're waiting to hear from the Department of Justice. And apparently, Tony, so are they on this one. But something to keep a close eye on. It's pretty important when you look at all the investigations.

HARRIS: I think you're absolutely right about that. All right, Poppy, good to see you. Thank you.

We'll take a quick break. You're in the CNN NEWSROOM.

(COMMERCIAL BREAK)

HARRIS: And time now for a look at some of the stories heating up on the Internet. There she is, Ines Ferre.

What's hot, lady? Good to see you.

INES FERRE, CNN CORRESPONDENT: Good to see you.

From CNN.com, the first 11 women to serve in U.S. Navy submarines.

HARRIS: The ban lifted a couple of weeks ago, correct?

FERRE: That's right.

HARRIS: All right.

FERRE: And some of these ladies are saying, you know, we don't want to be trailblazers. All we want to do is just be like everybody else.

HARRIS: Yes.

FERRE: And, in fact, the Navy wants to put more women in the U.S. submarine -

HARRIS: So 11, correct?

FERRE: Eleven.

HARRIS: How many can we load in our new fangled system, about 10?

FERRE: Ten of them. We've got 10 of them right here. HARRIS: So we'll put all of the ladies' pictures on our blog page. Why don't we do that?

FERRE: Oh, great idea. Great idea.

HARRIS: Is that good? All right.

FERRE: All right. And then the next one is from Facebook.

HARRIS: Yes.

FERRE: First, it was "SNL." Now, Betty White's fans want her to host the Oscars and the Emmys. So they got her on "SNL." You know, it was a great success this past week.

HARRIS: Right, right, right.

FERRE: I don't know if you watched it. And now they're saying, hey, she should be hosting the Oscars.

HARRIS: So she's hotter than ever at 125 years old, right?

FERRE: And look at this.

HARRIS: Sorry.

FERRE: Eighty-eight and a half.

HARRIS: Hey, I'm sorry.

FERRE: All right.

HARRIS: Boy.

FERRE: Almost 50,000 people. Unbelievable.

HARRIS: Really? OK. Sorry, we just don't have a lot of time.

FERRE: I know.

HARRIS: We had the president and President Karzai.

All right, we've got to go.

David Cameron brings Great Britain's conservatives out of the political wilderness after 13 years. There is a Tory at number 10 Downing Street. We're back in a moment. You're in the CNN NEWSROOM.

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HARRIS: Boy, a story of disaster and survival unfolding in North Africa today. A Libyan airliner crashed on approach to Tripoli Airport, killing about 100 people. The wreckage is unrecognizable as a plane. And you wonder how anyone could possibly survive. But this child managed to get out alive. He is said to be an eight-year-old Dutch boy. Now, the Airbus was arriving in Tripoli from Johannesburg and was scheduled to fly on to London's Gatwick Airport. It crashed just short of the runway. One report says 61 Dutch nationals are among the dead. A Libyan government official describes the survivor's condition as relatively good. He is expected to recover. Other reports say the boy has broken bones, but none of this information is confirmed.

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HARRIS: In Great Britain today, there is a fresh, young face at number 10 Downing Street. CNN's Max Foster is outside the prime minister's residence in London. And we're not talking about Max, we're talking about David Cameron, who, Max, I understand, got right down to business today.

MAX FOSTER, CNN CORRESPONDENT: He really did. He's been talking today about a new style of government. New politics even. And it certainly is that. We haven't had a coalition government in this country since the second world war.

Now we have one. David Cameron is the prime minister. He's appointed Nick Clegg of the liberal democrats as his deputy prime minister. And the two men, fierce rivals just a week ago, appeared in the garden behind me, apparently the best of friends, laughing and joking. Let's first hear from David Cameron.

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DAVID CAMERON, BRITISH PRIME MINISTER: It will be an administration united behind three key principle -- freedom, fairness and responsibility. And it will be an administration united behind one key purpose, and that is to give our country a strong and stable and determined leadership that we need for the long term.

NICK CLEGG, BRITISH DEPUTY PRIME MINISTER: We are different parties and we have different ideas. This is a government that will last despite those differences because we are united by a common purpose for the job we want to do together in the next five years.

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FOSTER: And, Tony, they are very different parties. It's going to be a tough challenge for both of those two to keep all their parties together, all their party members together. Also looking ahead, they've got massive spending cuts that they've got to organize between them. More than $10 billion this year, Tony, to deal with this massive sort of amount of debt that the government's got and they've got to deal with it.

HARRIS: Yes, that's got to be the top priority.

Max, appreciate it. Thank you very much.

Let's take things to the next level. CNN NEWSROOM continues right now with our chief business correspondent, the man, Ali Velshi.

ALI VELSHI, CNN ANCHOR: You have yourself a great afternoon, Tony.