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Campbell Brown
Obama Blasts Wall Street Bonuses; Blagojevich Removed From Office
Aired January 29, 2009 - 20:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
CAMPBELL BROWN, CNN ANCHOR: Hi, everybody.
Breaking news right now: It is the end of a have prolonged and very political dance of death. The bizarre, sensational, fascinating, and, yes, at times, pathetic saga of Rod Blagojevich is now even stranger in what the now former governor himself described moments ago as a shutout.
Blagojevich was booted from office tonight, unanimously impeached, and moments ago, he took to the microphones about the corruption scandal that claimed his job.
(BEGIN VIDEO CLIP)
ROD BLAGOJEVICH (D), FORMER ILLINOIS GOVERNOR: And the fight goes on.
Just because I'm not governor anymore doesn't mean I'm not going to keep fighting for you and for the causes that I fought for my whole life, for ordinary people, like my parents, who worked hard and struggled to build a better life for their children, who knew what the struggles were, who had fears and challenges, but also had hopes and aspirations and big dreams for their kids, those simple values that they teach us in Sunday school, the golden rule, that you should do unto others as you would have others do unto you.
Those are the things I'm going to keep fighting for now that I'm in private life. And I also want to say that I'm going to keep fighting to clear my name. I'm disappointed in the state Senate's actions, because they deprived me of an opportunity to bring witnesses and prove my innocence.
I wanted to do that sooner, rather than later. I guess I will just have to wait until I have my day in court.
(END VIDEO CLIP)
BROWN: Living up to all of the unpredictable photo-ops and speeches. we have seen from him in recent weeks, he then went into the crowd outside his home on a freezing 12-degree night in Chicago, working the reporters.
It was as if he were running for office, not being thrown out of office. But he did refuse to answer questions about what went wrong this week.
(BEGIN VIDEO CLIP)
BLAGOJEVICH: So, I'm not looking for any pity and I don't need anybody to sympathize or feel bad for, me because I will be just fine.
Patti and I will rebuild our lives with our children, Amy and Anne. We will regroup. And I'm going to commit myself and focus on making sure that things are better for them, as I continue to fight and work on the issues that I believe deeply in and have fought for as governor, congressman, as a state rep and before that as a prosecutor and just a private citizen. I'm back in the private sector now. And I will keep fighting for those things.
(END VIDEO CLIP)
BROWN: Earlier today, at the state capitol, Blagojevich had made a passionate last-minute appeal, arguing the evidence just wasn't there, no proof that he had been selling President Obama's old Senate seat.
And then he got a call. His time in office had been cut short in a unanimous 59-0 vote to remove him from office. Every senator got up and spoke against the governor, as if to make sure Blagojevich knew loud and clear he was done.
We're all over this developing story. And that's not all. We're going to have much more on now former Governor Blagojevich and his impeachment in a moment.
But we have also got a whole lot more about President Obama, more details about his huge economic stimulus package.
So, we begin, as we always do, with bullet point number one: President Obama's toughest words yet on Wall Street and bankers and their bonuses in the middle of a recession. The president blasted Wall Street's big payoff for CEOs and Citigroup's aborted plan to buy a $50 luxury jet as taxpayers pour billions in saving those very same companies.
Bullet point number two tonight: the NO BIAS, NO BULL fine print look at the president's stimulus package. We're going to show you some of the more unusual line items in that $819 billion bill. Do we really need to use any of this money to help people quit smoking? We will talk about that.
And bullet point number three: Rush Limbaugh sounds a lot like he is campaigning to lead the GOP. The Republican Party may be unsure where to go next, but the radio giant has no doubts. Tonight, powerful Democrats including the president, are either using Limbaugh to make their case or trying to tune out the voice that millions listen to every day. We're going to take a closer look at that as well.
Now, though, as always, "Cutting Through The Bull."
A lot of us were pretty outraged to read new details today about big bonuses going to those Wall Street bankers, the guys whose companies we're all bailing out at this very moment. Despite the enormous damage created by the Wall Street failures, we now know Wall Street rewarded itself $18 million in bonuses for 2008.
We would normally take this moment to take a shot at them. But, frankly, the president did it for us today and said it pretty well.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: when I saw an article today indicating that Wall Street bankers had given themselves $20 billion worth of bonuses -- the same amount of bonuses as they gave themselves in 2004 -- at a time when most of these institutions were teetering on collapse and they are asking for taxpayers to help sustain them, and when taxpayers find themselves in the difficult position that, if they don't provide help, that the entire system could come down on top of our heads, that is the height of irresponsibility. It is shameful.
We're going to be having conversations as this process moves forward directly with these folks on Wall Street to underscore that they have to start acting in a more responsible fashion if -- if we are to, together, get this economy rolling again.
There will be time for them to make profits, and there will be time for them to get bonuses. Now is not that time.
(END VIDEO CLIP)
BROWN: Now is not that time.
And now we do go back to tonight's breaking news. One thing you can say about Rod Blagojevich is that he did not go down quietly. But, politically, anyway, he did go down. He was ousted from the governorship of Illinois by state lawmakers, who convicted him of corruption by a vote of 59-0.
But Blagojevich doesn't seem to understand the concept of defeat. So, go down in defeat? No, not exactly. He did however go down with his mouth open.
(BEGIN VIDEO CLIP)
BLAGOJEVICH: I need to begin by saying that I'm obviously saddened and disappointed, but not at all surprised, by what the state Senate did today.
It was something that I knew they would do a long time ago, pursuant to a variety of different dynamics that were taking place since the world changed for us on December 9. At some point, I will be happy to share some of those insights and thoughts with you.
But I'm really here today just to say how -- how grateful Patti and I and our daughters, Amy and Anne, are for the opportunity to be able to serve the people of Illinois as their governor for the past six years, how blessed I personally feel to have had a chance to get up every day and try to fight for ordinary people, average people, people who otherwise don't have a voice, and how grateful I am that it wasn't just getting up and fighting for them, but that we over the last six years have been able to achieve a lot of things for real, ordinary people, and do it in a way, as I said earlier today, without burdening them, without burdening the middle class, without raising taxes, expanding health care for all our kids, giving all of our senior citizens free public transportation, giving all of our uninsured women access to mammograms and Pap smears, and, God forbid cancer is found, the treatment necessary to cure them and make them healthy, giving all of our 3- and 4-year-olds and every parent of a 3- and 4-year-old the same opportunities to send their children to preschool, like Patti and I had an opportunity to do for our kids.
Put a record amount in education without raising taxes on people, raised the minimum wage two times for low-wage workers, when President Bush wouldn't raise it even once, just real things real people who otherwise don't generally don't have a voice, and are generally not the priorities of government.
(END VIDEO CLIP)
BROWN: Much more from the Blagojevich soap opera. Is the story over for this disgraced governor? We don't think so. And Jeff Toobin is going to be here to tell us what comes next.
Also ahead, we have already told you about indignation at the White House today over the bonuses handed out on Wall Street. Still ahead, we will explore why the president called them so shameful.
We will also talk to John King live at the headquarters of Fortune 500 company Caterpillar, no bonuses there, just deep job cuts, deep, dramatic job cuts.
Plus, Rush Limbaugh hasn't been elected to anything. Why are so many people now calling him the voice of the Republican Party?
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
BLAGOJEVICH: One more thing to the -- for the people in the Latino community (SPEAKING SPANISH)
(END VIDEO CLIP)
BROWN: That's former Governor Rod Blagojevich there. Let me translate that into English for you. He said: "I want to say one thing to in the Latino community. Thank you for your support. Together, we can make our state a much place for everyone."
Yes, we can.
Tonight, we are covering the breaking news. The Rod Blagojevich circus just won't quit, even though he was thrown out of office a few hours ago by a unanimous vote of the Illinois State Senate. It is an incredible end to a historic-making day. No other Illinois governor has ever been impeached and removed from office. David Mattingly has been watching every step of this political train wreck.
David, get us up to speed.
DAVID MATTINGLY, CNN CORRESPONDENT: Well, Campbell, Rod Blagojevich made it clear he wanted to fight this to the bitter end. And that is exactly what he got. In his last chance to save his job speaking to the Illinois State Senate, he tried to argue that he hadn't been convicted of a crime, so he shouldn't be kicked out.
Clearly, that argument didn't work. He didn't admit to any wrongdoing. And, even tonight, he's still not saying he's sorry or saying goodbye.
(BEGIN VIDEO CLIP)
BLAGOJEVICH: I haven't let you down. I have gotten up every day thinking about you, fighting for you, pushing and prodding for you, being frustrated on your behalf, frustrated at a phony kind of politics that burdens you with everything, frustrated with a phony kind of politics where politicians talk a big game, but are not interested in getting anything done for you.
We have done real things for you, real tangible, meaningful things.
(END VIDEO CLIP)
MATTINGLY: That didn't resonate at all with the state Senate. He didn't win a single vote there, Campbell.
BROWN: And what do you make of that? I mean, the assumption was that he would in fact be impeached, but I didn't necessarily think it would be unanimous. But that sends quite a message, doesn't it, David?
MATTINGLY: Well, what they're saying tonight is that it's because he didn't defend himself, he didn't take the stand, he didn't testify under oath. He went on national TV, but he didn't talk to them, the state legislators who were actually holding his fate in their hands.
They say, he didn't present them any evidence to refute any of the allegations against him that he tried to use his office to pressure others for his personal gain.
(BEGIN VIDEO CLIP)
JOHN CULLERTON, PRESIDENT, ILLINOIS STATE SENATE: I had asked him to come. And at least he came to give a speech. But he didn't submit himself to answer questions under oath.
As Senator Haine had pointed out, as in any trial, the arguments are not evidence. There was not one shred of evidence offered to rebut the prosecution's comments. It's the first time, I'm sure, in history that, in an impeachment trial, the one accused was a no-show. And it was a big mistake.
(END VIDEO CLIP)
BROWN: So, David, he's out of a job, clearly, but what next?
MATTINGLY: Well, as hard as he fought to keep his job, he's probably going to have to fight just as hard to stay out of prison. People are saying they hope he has a good lawyer, because all those allegations against him have not gone away.
BROWN: Indeed, they haven't. David Mattingly for us tonight -- David, thanks.
We want to bring in two members of the best political team on television to talk about Blagojevich, senior political and legal analyst Jeffrey Toobin, a former federal prosecutor, with me, and senior political analyst Gloria Borger.
And, Gloria, we saw the governor mount this huge public relations campaigns this week. He came on this show. He spoke his piece in the legislature today. But was there anything he could have said anywhere in any forum that could have changed the course of events?
GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: Well, as David just said, he might have tried to defend himself against the specific charges that were leveled at him.
His lawyer quit. He decided instead to go on this valedictory tour, farewell tour, whatever you want to call it, to get the American public and maybe a future jury pool on his side. He had a -- you know, he had a very steep climb.
But he decided that he was just going to sort of say to the legislature, forget you guys, who are voting on me. I'm going to go over your heads and talk to the people.
And it didn't work and it was never going to work.
BROWN: But he has a different take on this, Jeff.
And let's listen to what he said, speaking to the state legislature this afternoon.
(BEGIN VIDEO CLIP)
BLAGOJEVICH: How can you throw a governor out of office who is clamoring and begging and pleading with you to give him a chance to bring witnesses in to prove his innocence, to do more than just ask for a presumption of innocence? Don't even give me that. Let me make my case, let me bring my witnesses in, let me show you that I'm innocent and I didn't do anything wrong.
(END VIDEO CLIP)
BROWN: So, he says he wanted to defend himself. JEFFREY TOOBIN, CNN SENIOR ANALYST: He said that he wanted to call witnesses. He could have called witnesses. He couldn't call exactly the witnesses he wanted to call.
But the idea of witnesses was certainly available to him. And the thing that was so maddening about this endless P.R. offensive was that he never responded to the charges.
This is the accusation. You said, give me $50,000 or I won't give you $7 million for the children's hospital, a pretty tough accusation. What's his response? He's been on every interview show in the United States, and he's never even addressed that. That's what's so maddening about this crazy behavior.
BROWN: I have got ask to ask both of you -- I mean, Gloria, you saw him outside of his house tonight. We're going to put some pictures up. He's shaking hands. He's hugging kids.
BORGER: I know.
BROWN: It's like he's loving this. I mean, this can't be the final chapter of this story.
BORGER: Well, I think, if you talk to shrinks, they will tell you that denial is a very legitimate form of coping.
(LAUGHTER)
BORGER: And I think this is a man clearly in denial here or delusional, one or the other.
And don't forget, he knows that he's facing a criminal trial, so maybe he's playing to the public in Chicago, saying, you know, I'm on your side. I have always fought for you.
But it's kind of odd.
TOOBIN: I think that's a little more logical than anything he's actually done.
(LAUGHTER)
TOOBIN: You know, this is -- we're really -- we have got a legal analyst, a political analyst. What we really need is a psychiatric analyst, because his behavior is not rational by any standard.
BORGER: Right.
BROWN: Well, finally, Jeff, though, and, quickly, the criminal trial is going to happen. He would like to call -- or he would love to call Valerie Jarrett, very close to President Obama, and Rahm Emanuel, of course, chief of staff. Do you see that happening?
TOOBIN: Definitely. He will definitely have the right. I think the prosecution will call Valerie Jarrett. She's a key part of the case. And I think they will definitely testify at this trial. BROWN: So, this story is not yet over.
TOOBIN: You're smiling when you say that.
(LAUGHTER)
BROWN: I'm not. I'm not. Thanks, guys, Gloria Borger and Jeff Toobin, for us tonight.
BORGER: Sure.
BROWN: Coming up, President Obama said today, we all have some responsibility to get the economy moving.
At this point, we are all invested in it. But can it work? The best money team on television breaking it down for us.
And then later, this volcano in Alaska could blow its top at any moment. We're watching it. We're going to show you the very latest shortly.
(COMMERCIAL BREAK)
BROWN: As you heard a moment ago, the news of those big bonuses at some of the bailed-out banks has clearly stirred up things inside the Oval Office.
Ed Henry is at the White House tonight. He has the very latest on this.
And, Ed, some pretty strong words from the president today. You're hearing next week, he's actually going to put some muscle behind it in terms of policy. What are you hearing?
ED HENRY, CNN WHITE HOUSE CORRESPONDENT: That's right, Campbell.
Senior officials are telling us tonight that the president is planning next week to unveil some sort of a massive financial reform package, go beyond just trying to stimulate the economy, but also get at what's wrong in the credit markets, how do you restore some trust and confidence in the markets, the SEC, the regulators who were asleep at the switch.
And, specifically, there will be a provision in there cracking down on Wall Street bonuses. The president was irate after he read this report today about more than $18 billion bonuses this year, this past year, to Wall Street folks, after a lot of their companies were teetering on the edge of bankruptcy, and they were coming to Washington for government handouts.
And so I think you can expect the president next week to try to come out and show that this is not just talk. Earlier this week, you will remember, he also -- some officials in his administration pressured Citigroup to refuse delivery on that $50 million corporate jet after they have received a lot of government's money.
So, clearly the president realizes this is an issue that might resonate and he wants to jump all over it -- Campbell.
BROWN: Well, like you said, it isn't just about new policy. He would love to get some political mileage out of this as well, wouldn't he?
HENRY: Absolutely.
And it's also because he wants to connect with the American people on the economy. They're obviously feeling a lot of anxiety. So, what's an easier target than Wall Street fat cats? That's part of it.
But I think also this president has some personal credibility on the line. Let's not forget that, in his inaugural address, he talked about a new era of responsibility. Well, that includes business executives, obviously.
And so he now has to play a key role in keeping them honest. And, so, we're going to be keeping him honest and make sure that he's following up on ushering in that new era of responsibility. He wants to make sure -- in fact, he had some CEOs here at the White House yesterday. We're told that he told them that they need to lead by example.
But the president's own personal credibility is on the line now and so he wants to step it up. And he needs to obviously -- Campbell.
BROWN: Ed Henry for us from the White House tonight -- Ed, thanks very much.
HENRY: Thank you.
Still clearly plenty of room to improve the president's economic revival plan, and he keeps saying that he's open to some Republican ideas. So, why is Rush Limbaugh at the front of the line tonight? Where are the rest of the Republicans, and do they even know what they stand for anymore? We're going to get into all that, NO BIAS, NO BULL.
And then later, look who dropped off the kids off at school today. When you're the president of the United States and the first lady, it's a pretty big deal. We're going to show you what happened.
(COMMERCIAL BREAK)
BROWN: When you're dealing with these big numbers, it's easy to forget that this crisis is about all individual Americans, their jobs, their families, how they're going to pay their bills come tomorrow.
And take a look at this. More than 4.7 Americans are unemployment right now, the largest number since 1982. Just this week, Caterpillar Incorporated announced it's cutting nearly one-fifth of its global work force.
And chief national correspondent John King is at the Caterpillar factory in Peoria, Illinois. And, John, Caterpillar was a company that until recently seemed to be doing really well. So, these layoffs have got to come as somewhat of a surprise to these workers. What are you hearing from them?
JOHN KING, CNN CHIEF NATIONAL CORRESPONDENT: Exactly right, Campbell.
The recession has hit late here in Peoria, but it has hit quite hard. Now, why was Caterpillar doing OK? Because more than 50 percent of its products were shipped overseas. So, while the U.S. auto industry and other U.S. manufacturers were struggling, Caterpillar was doing OK because of its sales to China, to Brazil, and Argentina.
But now with the big global slowdown, as you noted, Caterpillar is shedding 20,000 workers by the end of March. We talked to several today, and among them is Christy Williams. She's a single mother of five children. They run from age 5 up to age 14. She was told she was losing her job. She was given two weeks' notice, but she says she didn't tell her children until the very end, because she didn't want them to know how worried she is.
(BEGIN VIDEO CLIP)
CHRISTY WILLIAMS, FORMER CATERPILLAR WORKER: I don't let them see that I'm stressed out about things. That's why I waited. I didn't tell them right away.
The two 5-year-olds, I didn't think they would understand what that meant anyway. So, I just waited until I was done working. And then I said, you know, things are going to be a little bit different. I'm going to be home in the morning and when you go to school and when you get home from school. And we have just kind of gone that route.
(END VIDEO CLIP)
KING: Now, Christy Williams is on unemployment now. She has about 10 weeks left. She is hoping the big stimulus debate back in Washington means there could be extended benefits for her.
But, Campbell, she is like so many people in this community. She has a four-year college degree. She's been looking for a job since she was laid off. She says there are so many skilled employees now in the marketplace, there are no good jobs to be had. She's beginning to compromise her search, thinking maybe she will go to work at the mall in retail sales, something that would pay her a lot less than she was making, but she's worried of course about paying the mortgage and most of all about feeding her children -- Campbell.
BROWN: Of course she is.
And, John, you could see why they might be hopeful. I mean, Caterpillar makes construction equipment. And to get more orders, there needs to be demand for new projects like those in the stimulus plan. But given how long this whole thing is going to take, between the politics of it and actually that sort of kicking in, so that it might affect them, they have to be worried that it could be too late, huh?
KING: They are worried it could take awhile, Campbell, although they think any money spent on building roads and bridges will ultimately help Caterpillar. But there's a mixed blessing there, because both the House and the Senate versions have a buy American clause.
And what the Caterpillar workers worry is, if all those products have to be American-made, that there will be a trade war, that other countries will retaliate against the United States, and that Caterpillar won't be able to sell to China, won't be able to sell to Asia.
So, they say, in the short term they're worried, even though this would ultimately help jobs in the United States, it could hurt Caterpillar and even potentially, Campbell, in the short term cost more jobs.
BROWN: All right. John King for us tonight -- a good point there, John. Thanks.
Breaking it down a little further, we have got chief business correspondent Ali Velshi and national political correspondent Jessica Yellin. And their job is of course to tell us exactly how the president's stimulus plan could create jobs.
And, Ali, just heard John King, the real concern that these spending projects may happen too late, that it could spark some sort of trade war. Are they right? What would you tell them?
ALI VELSHI, CNN CHIEF BUSINESS CORRESPONDENT: Well, listen, Christy's concern in that piece is so dramatic, because, ultimately, unemployment pays a fraction of what she would have earned.
But there are 4.8 -- almost 4.8 million people on unemployment insurance right now, possibly close to 11 million people who are unemployed in America. Many of those people don't get unemployment insurance because they have been unemployed for so long that they're off the rolls.
We are probably expecting in January more than 500,000 people to have lost their jobs. We started this week. You and I have been talking every single day. It doesn't matter what people say. The only goal right now of the stimulus plan has got to be to get America back to work, because ultimately people with a paycheck will spend that money.
And, as Jessica explained last night, if they spend it, it creates jobs, and those jobs then mean people who are further employed and pay taxes and buy things. That's got to be where every part of the stimulus goes. And there are good criticisms that there are some things in the stimulus bill that are not directed toward creating jobs. They're good, but they're not about creating jobs. JESSICA YELLIN, CNN CONGRESSIONAL CORRESPONDENT: The stimulus, though, does extend unemployment insurance for somebody like Christy. If this goes through, she will have about double the amount of unemployment she had before and about $25 more a week.
BROWN: But, in the political universe, Jessica, you also hear this argument. There are people out there who say it's time to back off and let the economy correct itself, which you can't imagine, given what we just heard, is going to resonate on any level with anybody.
YELLIN: Absolutely.
There's a vocal minority -- and a small minority, as Ali has pointed out -- of people who say, look, we got into this problem by spending too much and borrowing for that money. How are we going to get out of it by doing more of the same?
Now, that, again, is just one section of the criticism. The greater criticism is that tax cuts could do more. And that's what especially conservatives are saying, especially business tax cuts.
BROWN: And let me to that point, Ali, I'll read you this quote. Rush Limbaugh today who's getting a lot of attention on the "The Wall Street Journal." "Tax cuts are the surest and quickest way to create permanent jobs and cause an economy to rebound. That happened under JFK, Ronald Reagan, George W. Bush. We know that when tax rates are cut in a recession, it brings an economy back."
But you --
ALI VELSHI, CNN CHIEF BUSINESS CORRESPONDENT: This is not the economy that Ronald Reagan ever saw or anybody with the last name Bush ever saw, or Clinton. We have not seen anything like this in our lifetime.
Now, here's the issue with tax cuts. We are in a recession. Whether you are a person or a company, the only way to get through a recession is to have enough cash to get you to the other side in case you don't have any business or in case you don't have any work. So when companies take tax cuts, the idea is they use the savings to reinvest, build factories, employ people and get going.
BROWN: Right.
VELSHI: You know what happens in a recession? Any cash that they get, any saving that they get, many companies will just hold, many individuals. That's why they won't spend the money.
BROWN: Right.
VELSHI: They'll hold it to prepare for the worst.
You know that on the other side of a recession, business is good, but you may not spend it until then. So when anybody tells you this is how it works is lying. We don't know how it works. We have never seen anything like this before. BROWN: A point we heard made a number of times this week. Nobody knows how this is going to play out.
All right. Many thanks to Jessica and to Ali tonight. Appreciate it.
And coming up in a moment, Rush Limbaugh. It's almost as if he is campaigning to fill this big Republican vacuum. Is the big man at the mike now the voice of the Republican Party? We're going to explain why some Democrats wouldn't mind that a bit.
And in the "Political Daily Briefing," a judge decides California's governor Arnold Schwarzenegger has the power to force state workers to take unpaid days off. We'll have the story.
(COMMERCIAL BREAK)
BROWN: Here we see it, as strong a bond as there may be in Washington, President Obama and his smart phone. The love affair that could not be ended, not by an election, not by life in the White House, not even by national security concerns. The president held on to his handheld.
And with that, Erica Hill is here with the "Political Daily Briefing."
And this begins --
ERICA HILL, CNN CORRESPONDENT: All is right in the world.
BROWN: It begins with an appearance by our former president, correct?
HILL: It does. In fact, the first appearance since former president and Mrs. Bush left the White House and Wednesday night joining thousands of fans to cheer on the Baylor University women's basketball team. That it was actually number 43 who got the early standing ovation before the game even began.
There they are, walking in with Lady Bears coach, Kim Mulkey, a huge reception as you can hear for the former president. Another introduction during the first TV time-out brought a second round of cheers for the Bushes.
Now, their Crawford ranch, by the way, is only about 25 miles from Baylor, but we're told this is the first game they've attended in person, although he did meet their coach in 2005 when she and the team came to the Oval Office, Campbell, after winning the NCAA championship. I believe they're in -- they're fourth right now.
BROWN: Wow.
HILL: They're number four.
BROWN: Very impressive.
HILL: They lost that game the other night.
BROWN: Very impressive. Not as much enthusiasm probably in California for the governor in his victory.
HILL: He probably knows so much these days.
BROWN: Yes.
HILL: And that's because it is a win for Governor Arnold Schwarzenegger, but a lot of state employees may not be feeling that they're winning. A state court today ruling his executive order which forces state employees to take off two unpaid days per month is in fact perfectly kosher despite claims from unions and the state comptroller that it is illegal.
The order goes into effect next Friday. Those forced days off work amount to about a nine percent pay cut for employees, although they could save the state as much as $1.4 billion through June 2010.
California, by the way, facing a huge deficit which is expected to grow generally $42 billion next year. It is so bad at this point, the state is suspending taxpayer refunds beginning February 1st, because, Campbell, it simply cannot afford them.
BROWN: Things are bad in California right now.
OK. Let's switch gears to a bit of a lighter note. President and Mrs. Obama paid a visit to the school.
HILL: Indeed they did. Visiting the school this morning, of course, the day after the snow day which President Obama mentioned yesterday. The first couple arriving at Sidwell Friends about 8:15. They were at the lower school on the campus there, where Sasha is in second grade for.
What we're told was a class presentation. Beyond that, though, we couldn't get a lot of information. The White House not saying just what that presentation was about.
We do know the president and first lady stayed at school for about an hour. One tidbit I found interesting from the full report here, it was not an official trip, so, Campbell, the motorcade did in fact stop at every traffic light.
BROWN: I never knew that. If it's unofficial, they have to stop at red lights?
HILL: Apparently.
BROWN: Oh, OK.
HILL: Just like the rest of us. Imagine that.
BROWN: We learn something every day. But we did get details, no details on the presentation, but we know who they're rooting for on Sunday, America's first couple? HILL: Yes, we do, which is really the big question, right? Stimulus shimulus (ph). What you really want to know is the Super Bowl, huh?
Well, the president today had this to say when asked who he'd be rooting for this Sunday.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: I wish the best to the Cardinals. They've been long suffering. It's a great Cinderella story, but other than the Bears, the Steelers are probably the team that's closest to my heart.
(END VIDEO CLIP)
BROWN: There you go, Joe Biden basically went on to say he's sticking with the boss on this one.
Chances are, though, these two are not watching the game together. As we told you last night, the Bidens are hosting a Super Bowl party at the Naval Observatory, their new home. And today White House Press Secretary Robert Gibbs saying the president is following up last night's cocktail party for lawmakers with another get together for the Super Bowl.
BROWN: A bipartisan Super Bowl party.
HILL: Keep pushing. I wonder if they'll have those helmets that are chip bowls. One for each team at the White House.
BROWN: They can have anything they want at the White House.
HILL: It is true.
BROWN: Erica Hill tonight. Thanks, Erica.
Coming up, ask Speaker of the House Nancy Pelosi about Rush Limbaugh and this is what you get.
(BEGIN VIDEO CLIP)
REP. NANCY PELOSI (D), HOUSE SPEAKER: I don't speak to that. I'm the speaker of the house. I don't get into that.
(END VIDEO CLIP)
BROWN: We're going to look at the well known conservative who has Democrats either dropping his name or just trying to drop the subject.
And then later, his city fell victim to Katrina. Wait until you hear what a Mississippi mayor and his wife are accused of doing.
(COMMERCIAL BREAK) BROWN: Despite the challenges he faces, President Obama's approval ratings are still high and that leaves the Republican Party under increasing pressure to find a leader who can rally the troops. Could that be Rush Limbaugh stepping in to fill the void? Listen to what he said on his radio show this week about the president.
(BEGIN VIDEO CLIP)
VOICE OF RUSH LIMBAUGH, RADIO TALK SHOW HOST: He's obviously more frightened of me than he is Mitch McConnell. He is more frightened of me than he is of, say, John Boehner, which doesn't say much about our party.
(END VIDEO CLIP)
BROWN: So what does it say about the party as Republican officials prepare to select a new party leader tomorrow and discuss their future on a retreat this weekend? Senior political correspondent Candy Crowley talked to some GOP leaders.
(BEGIN VIDEOTAPE)
CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT (voice-over): Republican Party activists are meeting inside this hotel ballroom in Washington, D.C. There will be no dancing.
SEN. MITCH MCCONNELL (R), MINORITY LEADER: We need to recognize where we are. Over the past two elections, we've lost 13 Senate seats and 51 House seats. Our most reliable voters are in decline as a percentage of the overall vote. And Democratic voter registration is on the rise.
CROWLEY: It's a mess as Republicans grapple with how to expand the party's appeal without abandoning the party's principles. How to attract new Republicans without alienating the faithful.
PHIL MUSSER, REBUILDTHEPARTY.COM: Clearly the Republican brand needs work, and I think that's a widespread recognition here that we lost our way.
CROWLEY: For starters, eight years of massive spending and jaw dropping deficits have shaken the party's core economic values beyond recognition.
UNIDENTIFIED MALE: We're the party of less government, less taxes.
CROWLEY: More difficult than a course correction on economics is reputation. Republicans say they are wrongly viewed as "the anti's" -- anti-immigrant, anti-union, anti-environment, the party of no. Which is why as Republicans line up to oppose a stimulus plan they think cost too much and won't work, they sound so defensive.
SEN. JEFF SESSIONS (R), ALABAMA: It has nothing to do with the idea that we might get some political advantage if Obama stumbles. As an American, I want to see the right thing done regardless of who gets the political credit.
CROWLEY: There are Republican alternatives, but it's risky business opposing the stimulus plan without being seen as opposing a very popular president who's courtship of Republicans has been frequent and well photographed.
The party's myriad problems on and off the Hill are exacerbated by the absence of a clear leader. Democrats are happy to fill the void with the notion that sharp edge talk show host Rush Limbaugh is the true voice of Republicans, and he's not applauding the president's outreach program.
RUSH LIMBAUGH, RADIO TALK SHOW HOST, "THE RUSH LIMBAUGH SHOW": But when he got Republican input, he rejected it. Remember he said he won the election, meaning he's going to do whatever he wants to do. This entire sham of a bill, and the sham of this great uniter and unifier has now been exposed.
CROWLEY: Inside the ballroom, they're still not dancing.
MCCONNELL: My concern is that unless we do something to adapt, our status as a minority party may become too pronounced for an easy recovery.
CROWLEY: The clock is ticking.
(END VIDEOTAPE)
BROWN: And Candy, the Republican National Committee will pick its new chairman tomorrow. Will that vote tell us anything about the future of the party?
CROWLEY: It will tell us a little bit, but what they really need is a spokesman where a governor is the best bet that someone will come out of there with some real policy ideas. The party chairmen are nuts and bolts people. Nonetheless, there are some signals.
There are two African-Americans, Michael Steele, who was, as you know, the lieutenant governor in Maryland, along with Ken Blackwell, who was secretary of state in Ohio. If an African-American were put in that post, it certainly would signal a party very anxious to broaden its base.
You have the existing GOP chairman Mike Duncan, who is also running. An election of him would say we think actually George Bush was the problem and not the party.
You also have two party chairmen, one from South Carolina and one from Michigan who are running. If the South Carolina party chairman should win, that's a signal that the Republicans are pretty happy with where their base is and that's in the south. If the one from Michigan should win, that's a signal that they know they need to broaden that base. So you'll get some small hints, but really they need that big picture guy.
BROWN: All right. Candy Crowley for us tonight. Candy, thanks. Coming up, we'll ask some of the smartest minds in politics about the turmoil in the Republican Party, about Rush Limbaugh. Is it possible he really is the most important Republican in America right now?
Also, wait until you hear the outrageous charges facing one Gulf Coast mayor accused of trying to make money off the pain of Hurricane Katrina.
(COMMERCIAL BREAK)
BROWN: Listen up, Republicans. Here is a stark warning from Senate Minority Leader Mitch McConnell today at the Republican Party's winter meeting.
(BEGIN VIDEO CLIP)
SEN. MITCH MCCONNELL (R), SENATE MINORITY LEADER: Now in politics, there is a name for a regional party. It's called a minority party. And I didn't sign up to be the member of a regional party. And I know you didn't either.
As Republicans, we know that common sense conservative principles aren't regional. But I think we have to admit that our sales job has been. And in my view, that needs to change.
(END VIDEO CLIP)
BROWN: Right now, the top salesman for Republican ideas seems to be Rush Limbaugh who is even offering to discuss his own economic stimulus proposals with President Obama. Is that the best way to start a comeback from the political wilderness?
We want to ask Republican strategist Kevin Madden, CNN senior political analyst Gloria Borger, and "New York Daily News" columnist Errol Lewis.
Guys -- Kevin, let me start with you. You know, you just heard Mitch McConnell. You got top Republicans conceding your party has serious problems. How did Rush Limbaugh sort of become the most prominent Republican voice in the country right now?
KEVIN MADDEN, REPUBLICAN STRATEGIST: Well, look, I don't think that the party is about one face or one voice. I think one of the reasons that -- if you look at a lot of Republicans that we've gone back in trying to diagnose where we went wrong in 2006, where we went wrong in 2008, it's that we were no longer the party of ideas and we were no longer the party of reform. And Republican Party flourishes not when we're attached to an individual or a cult or personality, but when we're the party of ideas, a very proactive agenda and when we're the party of reform.
And I think that's where the Republican Party is kind of wrestling with right now. How do we go back to being the party of ideas? How do we go back and get that big mental of the American electorate, not just Republicans either but independents and conservative Democrats?
BROWN: But --
MADDEN: I think we lost our way on issues like spending.
BROWN: But you do need people who define those ideas for you, and frankly, like it or not, Limbaugh is the one who is defining those ideas for a lot of people.
MADDEN: Well, I would disagree. Look, I think Rush Limbaugh is the -- you know, he gives voice to the conscience of many conservatives across the country. But we don't necessarily need one individual right now when we back and we find that we're the party of ideas and we go out and we express those ideas on the big issues that the American public cares about.
BROWN: Right.
MADDEN: The things that are driving their anxieties right now, individuals will emerge. People like Mitt Romney on the economy, people like Bobby Jindal on issues like Medicare, and people like Tim Pawlenty out in Minnesota on how we reach middle class voters. That is what we have to focus on.
BROWN: But we really --
MADDEN: I think that's going to be the result of these meetings this weekend.
BROWN: Gloria, we haven't really seen those people, Romney or Jindal, emerge as real leaders and you do need along with ideas, you do need leaders to convey those ideas.
GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: Right.
BROWN: You know, how many people does Rush Limbaugh really speak for and why has he risen to this position that he's getting this level of attention? Is it just because nobody else has emerged?
BORGER: Well, it could be. I mean, look, Limbaugh speaks to millions of folks who listen to him, but I think what you have is a vacuum at the top of the Republican Party. I think Senator McConnell's sober assessment is absolutely true. And maybe you're not going to look to Congress to find the leaders. Maybe you will look outside of Congress.
But I remember when Newt Gingrich came in and the Republicans actually took control of the House of Representatives. He was a leader. He was a figure head, and he had ideas. Remember the contract with America, and he also was a reformer.
And what's happened to the Republican Party is they've lost their way. They're not reformers anymore. They became the establishment. That's one of the reasons Obama was elected.
BROWN: And Errol, Democrats love having him be the figure head, don't they?
LOUIS: Oh, obviously. You know, there was all this talk about how President Obama made a mistake by mentioning his name since it elevates his stature.
There's the possibility that it was entirely deliberate. I think the Democrats would like nothing better than to present this person who really -- you know, Kevin talked about a party that needs to be a party of ideas. This is somebody who kind of makes a hash of ideas. I mean, he's in the entertainment business. He's not about real clear policy development. You know, even his piece in the "Wall Street Journal" today really confused some very basic concepts of Keynesianism and supply-side economics.
That's fine for him. All he has to do is fill up a couple of hours, get a lot of audience members riled up. But when it comes to putting together a party systematically, across a broad base, not just a narrow listenership, but a broad base of the public, he is, I think, the worst nightmare. They've got to get another face out there.
BROWN: Kevin, you get the last word.
MADDEN: Well, I do think there is one lesson that we can take from Rush Limbaugh is that his listenership, his audience is very much a grassroots movement. He sort of smashed the hierarchal, you know, paradigms that we've always looked at and instead, he's inspired millions of people. And that's what we have to tap into with again, with ideas not just individuals.
BROWN: All right, we got to end it there. Kevin, Gloria, Errol, as always, thanks guys.
In just a few moments, we're going to turn things over to "LARRY KING LIVE," and he has a very special guest tonight.
Larry, who do you have?
LARRY KING, HOST, "LARRY KING LIVE": Well, Campbell, we got a prime time exclusive -- Ted Haggard. He was an influential Christian leader, but scandal involving a male prostitute and drugs quickly destroyed the career and the reputation. He's going to open up on what really happened, including his sexuality and thoughts about suicide. And we'll ask about new allegations that just surfaced.
It's all ahead on "LARRY KING LIVE," Campbell. It won't be dull.
BROWN: No, it won't. Larry, we'll be watching, thanks.
More late-breaking political news in a moment. A Gulf Coast mayor has just been indicted and the charges have to do with the aftermath of Hurricane Katrina. We'll have the latest on that next.
(COMMERCIAL BREAK)
BROWN: More of the latest news now, Tom Foreman joining us right now with "The Briefing" -- Tom. TOM FOREMAN, CNN CORRESPONDENT: Hi, Campbell.
Experts say there is little doubt Alaska's Mount Redoubt Volcano will erupt. Campbell, the question is when. The state volcano observatory is watching the 10,000 foot peak, 100 miles from Anchorage. Mount Redoubt last erupted 20 years ago.
The mayor of Gulfport, Mississippi has been indicted for allegedly trying to rip off FEMA and other government agencies. Brent Warr and his wife are accused of lying about a damaged home to get more than $200,000 in Hurricane Katrina money. They pleaded not guilty. The mayor intends to stay in office.
The shoe-throwing incident involving former President Bush is leaving a new footprint in Iraq. A giant replica of the shoe has been unveiled at an orphanage in Tikrit honoring the Iraqi reporter who threw his shoes at Mr. Bush in Baghdad last month. That reporter is still in jail, by the way.
And this is the biggest ice house we've ever seen. A truck towed this home off of an island and across frozen White Bear Lake in Minnesota. The house weighs 60 tons, but it took less than an hour to move it across the ice to its new location. I'm guessing it would take a lot longer in the summertime.
BROWN: Yes. I would not want to be driving that truck. I don't know.
Tom Foreman tonight. Tom, thanks.
Our "Bull's-Eye" is next. Why this working woman got a hug from President Obama at the White House today. We'll explain.
(COMMERCIAL BREAK)
BROWN: Tonight, our "Bull's-Eye" goes to a woman you may not have heard of before now. But because she wouldn't take no for an answer, our laws are a little more fairer today because of Lilly Ledbetter, President Obama's special guest at a White House ceremony today. And here's why.
After 19 years working at a Goodyear tire plant, she found out she was earning less than the men there doing similar jobs. She sued, but the Supreme Court ruled she went to court too late.
Today, President Obama signed a law named for her, relaxing the deadline for filing wage discrimination lawsuits. Listen to what the president said this morning.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: If we stay focused as Lilly did and keep standing for what's right as Lilly did, we will close that pay gap and we will make sure that our daughters have the same rights, the same chances, and the same freedoms to pursue their dreams as our sons. (END VIDEO CLIP)
BROWN: Well said, Mr. President.
Tomorrow on "NO BIAS, NO BULL," new education secretary Arne Duncan in his first interview about what he is going to do to improve our schools.
We want to hear from you about issues facing your local schools, so send us your iReport at iReport.com.
That is it for us tonight. "LARRY KING LIVE" starts right now.
