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Obama Could Name 1st Black Attorney General; Auto Companies: We Need Help; White House Tour for Obama Girls

Aired November 18, 2008 - 16:00   ET


WOLF BLITZER, CNN ANCHOR: Happening now, potentially more surprises from Barack Obama. The man set to become the first African- American president could be ready to make history again.
Also, titans of the auto industry are forced into a rather humbling act. They are desperately asking for money to save the big three automakers. If they fail, you could be hurt.

And John McCain finally goes back to his day job. How was he received in the Senate? And what's next for the senator who wanted to be president?

I'm Wolf Blitzer. You're in THE SITUATION ROOM.

President-elect Barack Obama could be on the verge of another history-making move. As he ponders who will help him run the government, we are hearing one name is possibly under consideration for one of the most important jobs in the country.

Let's go straight to CNN's Jessica Yelin. She's in Chicago covering the transition to power. What are you hearing, Jessica?

JESSICA YELLIN, CNN CORRESPONDENT: Wolf, the latest word is that Eric Holder, a former federal prosecutor and deputy attorney general under Janet Reno, is the leading contender to become attorney general in Barack Obama's upcoming administration. Some news outlets have reported that he has been offered the job, but a number of sources very close to Barack Obama tell us at CNN that it is not a completely done deal yet, but that he is the likely attorney general in the upcoming administration.

This man is one person with whom Barack Obama is very close. They share legal views. He is also someone very familiar with the Justice Department since he served under Janet Reno there.

Eric Holder is a man who would become the first African-American attorney general for the United States, and he does come with some baggage. During the Reno years, he was the man who was at the Justice Department when former President Bill Clinton pardoned Mark Rich. You'll remember he was a fugitive from justice here in the United States, got a last-minute pardon, and that stirred up some controversy because he had fled prosecution here. Eric Holder did not raise objections to that when Bill Clinton pardoned him.

Also, Eric Holder, a man closely associated with the Clinton years. Barack Obama has promised change. A lot of faces in his upcoming administration are remnants from those Clinton years, but where else are Democrats going to get some institutional knowledge? A lot of pressures there. Eric Holder well respected in Washington, D.C.

And finally, Wolf, a bit of trivia. He's a member of the board of trustees for Georgetown Day School. That's one of the schools the Obamas are looking at sending their girls. Could that nudge them in one direction? We'll see -- Wolf.

BLITZER: He's probably lobbying for that school.

But speaking of Clinton people, what about Hillary Clinton? What's the latest you are hearing about her possibly becoming the next secretary of the state?

YELLIN: Well, one of the big questions surrounding Hillary Clinton in the last few months was how will she pay down her debt? She had so many millions of dollars in debt. It now remains $7.6 million, is what she has left to pay down.

Obama has helped raise just under $1 million toward that debt. And one of the outstanding questions is, were she to become a member of the cabinet, could she help pay down her debt?

We spoke to two legal experts who say there's no law prohibiting it, but that could be a rule in the Obama administration. He might want to prevent her from raising any money. So it could be one of those small sticking points that has to be worked out before she could finally accept any position with his administration -- Wolf.

BLITZER: Jessica, stand by. We'll get back to you.

Let's go over to Capitol Hill right now. An urgent appeal and a dire warning. Auto industry executives and workers' representatives essentially telling lawmakers, throw us a lifeline or the boat that is the auto industry may sink and possibly take down millions of American jobs.

Our Congressional Correspondent Dana Bash is up on Capitol Hill. She's working the story for us. They are literally pleading for help as we speak, Jessica -- Dana, excuse me -- right now.

DANA BASH, CNN CONGRESSIONAL CORRESPONDENT: That's right. They're about to do that. In fact, I think we are minutes away from actually hearing from the CEOs of the big three auto companies to really make that plea that you just described.

We saw an advanced text of at least two of these CEOs, and there's no question that they are going to make abundantly clear to these senators that they need help. That they really need help, and it's not just about them and their companies, but it is about the viability of the economy, of hundreds and hundreds of jobs across the country.

Now, we have heard over the past half an hour, or 45 minutes or so, statement after statement from the senators on this panel, the Senate Banking Committee. And there is not a lot of sympathy at all, to say the least -- I think that's a big understatement, actually -- from the senators about the predicament that these auto companies are in.

In fact, listen to the way that Chairman Chris Dodd described the way he feels about these companies.


SEN. CHRISTOPHER DODD (D-CT), CHAIRMAN, BANKING COMMITTEE: Their discomfort in coming to the Congress with hat in hand is only exceeded by the fact they are seeking treatment for wounds that I believe to a large extent were self-inflicted. No one can say that they didn't see this coming.

Their companies have been struggling for years. They've been content, mind you, to not only satisfy, but in too many respects, drive the demand for inefficient gas-powered vehicles that Americans have been going broke to gas up.

They derided hybrid vehicles as making "no economic sense." They have dismissed the threat of global warming, the role it played by their products in creating it, and the strong desire for the American people to do something to stop it.


BASH: Now a little bit of a reality check here. Certainly a lot of members of Congress, particularly Democrats, say that the auto industry has hindered the ability for more fuel-efficient cars, but Congress didn't do very much until a year and a half ago. In fact, they didn't do anything to raise those fuel efficiency standards for about 30 years.

Nevertheless, Wolf, we are hearing that theme. We are also hearing a theme from Republicans and Democrats that there has simply been mismanagement at this company regardless of the technology and moving ahead -- moving forward with technology. So those are the themes we're hearing.

Having said that, many of these Democrats and Republicans say they understand the need to give these companies help, but behind the scenes here on Capitol Hill, particularly in the U.S. Senate, there still does not to be any real sign of compromise on just how to do that. They only have really this week to try to figure out how or whether to help these auto companies, and I don't think we are going to see very much support for legislation that will probably save up for either tomorrow or Thursday -- Wolf.

BLITZER: All right, Dana. We'll stay on top of this story with you.

And by the way, if you think economic conditions are a nightmare right now, many are warning of even more horror if the auto industry were to collapse. That could hit many of you rather hard. For example, if the big three automakers fail, their 250,000-plus workers could all lose their jobs. Also, many estimates say at least 2.3 million jobs are tied to the auto industry one way or another, and many of those jobs could be lost as well. Some estimates put that number even higher. It's about two percent of the U.S. workforce.

All right. There's a story just coming into THE SITUATION ROOM. Want to go right over to the White House. Elaine Quijano is working the story. What are you learning, Elaine?

ELAINE QUIJANO, CNN WHITE HOUSE CORRESPONDENT: Well, learning just a few minutes ago, Wolf, from Sally McDonough, the press secretary to the first lady, that the Obama daughters Sasha and Malia will be visiting the White House this afternoon. Sally McDonough confirming essentially what was put out by Mrs. Obama's office.

Mrs. Bush, in fact, did invite the Obama daughters to the White House, along with their mother, of course, when the girls were available. You'll recall it was just last week, of course, that Michelle Obama was here, took a look at the residence for herself, took a look at the rooms where her daughters will be staying.

So we are told again by Sally McDonough, Wolf, this visit will happen this afternoon. She also says that there will not any kind of readout or photo release. But as you know, an incredible amount of interest surrounding this story -- Wolf.

BLITZER: And we hear the little girls were visiting some schools in the District of Columbia today, checking out the various possibilities.

All right. We'll stay on top of this story with you, Elaine. Thanks very much.

Let's go to Jack. He's got "The Cafferty File" -- Jack.

JACK CAFFERTY, CNN ANCHOR: That's nice, right? Laura Bush invites Michelle Obama and the kids over to check out the bedrooms and stuff.

BLITZER: Can you imagine how excited those little girls must be to just walk around the White House?


BLITZER: And Laura Bush says, you know, this is going to be your bedroom, this is going to be your bedroom. It's pretty exciting.

CAFFERTY: That's a nice touch though on her part.

BLITZER: Yes, very nice.

CAFFERTY: Yes. She should have been president.

BLITZER: She's a lovely lady.


President-elect Obama met with Senator Clinton last week. And ever since, lots of buzz about the possibility of Obama's former rival, heated rival, becoming his secretary of state.

The big question this week is what sort of problems Bill Clinton might cause in the vetting process of his wife. Since he left office, President Clinton has begun a new career which involves some complicated international business dealings. He also has a global foundation with a long list of donors, some of whom might not agree with incoming President Obama's policies. But the Clinton have been here before, haven't they?

If Hillary gets the all clear and is offered the secretary of state's job, the next question is, should she take it?

After losing the Democratic nomination to Barack Obama, Clinton returned to her old job as the junior senator from the state of New York. She is very popular with her constituents, could likely remain in the Senate as long as she wants to, perhaps even becoming a Senate leader at some point.

But if she takes the secretary of state's job, her -- she will then tie her career to a degree to the successes and failures of the Obama administration. Remember Colin Powell? If Obama stumbles, Clinton would likely have an easier time making another run for the White House, which she indicates that she would like to do, from the Senate, as opposed to from the secretary of state's office if things don't go well.

So here's the question. What is the proper role for Hillary Clinton in President Obama's administration?

Go to and post a comment on my blog -- Wolf.

BLITZER: Jack, thank you for that.

A U.S. congresswoman known for rarely biting her tongue unleashing a scathing charge against the treasury secretary.


REP. MAXINE WATERS (D), CALIFORNIA: The fact that you, Mr. Paulson, took it upon yourself to absolutely ignore the authority and the direction that this Congress had given you just amazes me.


BLITZER: The California Democrat Maxine Waters, she voted for the $700 billion bailout, but now says it is being mishandled. She is standing by live to join us. She'll explain.

And John McCain goes back to the job he knows rather well, but what will life in the Senate be like for him now?

And with millions of people expected here in Washington for the inauguration, what will it take to protect them? You may be amazed at the security efforts.

Stay with us. You're in THE SITUATION ROOM.


BLITZER: Today the treasury secretary, Henry Paulson, has been facing some tough questions regarding that $700 billion bailout and some serious criticisms in the process, some of them coming from my next guest.

Democratic Congresswoman Maxine Waters is joining us from Capitol Hill. Congresswoman, thanks very much for coming in.

WATERS: You're welcome.

BLITZER: : I listened to your grilling of Henry Paulson. You made the point that you supported the $700 billion even though you got some grief from other Democrats, some fellow members of the Congressional Black Caucus, but now you are disappointed.

Without getting into all the technical details, gives us the headline. Why are you disappointed in Henry Paulson?

WATERS: I'm so disappointed because when I voted for the bailout and convinced others to vote for it, it was because at the centerpiece of this bailout was loan modifications, help for homeowners who were facing foreclosure. That was the centerpiece of this legislation. This money was supposed to be used to buy up this toxic paper, this non-performing paper, mortgages that were in these banks and these service companies. And he has gone in a different direction. Not only has he not done that, he changed direction without even letting the Congress know.

BLITZER: Here's his explanation why he decided last week to have a reversal, if you will, a change on direction of how to use this money. Listen to this.



HENRY PAULSON, U.S. TREASURY SECRETARY: The key to turning around the housing situation and avoiding foreclosures is going to be to keep lending going. If a bank -- if the financial system collapsed, we would have many more foreclosures.


BLITZER: All right. What's wrong with that argument?

WATERS: Well, first of all, the equity investment in the banks is an investment to get the loans going, to unfreeze the credit, to buy cars, and to pay for student loans, but it does nothing for the foreclosure problem. The foreclosure problem is a problem where homeowners are facing losing their homes because they got involved in mortgages that they can't afford, they didn't understand. They are readjusting now, and when they readjust, they reassess (ph) at the existing interest rate, plus the margin on top of that, which means that loan could quadruple, almost, and they just can't afford them. So what he just described has nothing to do with loan modifications and helping to bail out the homeowners.

BLITZER: So you're not happy with what's going on right now. Is there anything though you could do about it? Does Congress have any ability to redirect those funds that Henry Paulson is controlling?

WATERS: Yes, we do. Yes, we do.

As a matter of fact, what we said to him and what we put in the law was he could spend the first $350 billion, but he had to come back to us to get our approval to spend the rest of the money. I'm prepared to work very hard against giving any further approval until America's homeowners are given some assistance in staying in these homes.

BLITZER: One final question, an unrelated matter. Is Hillary Clinton a good choice to become secretary of state from your perspective?

WATERS: Hillary Clinton is a good choice to become whatever Barack Obama would like to have her do. The woman is smart, capable and confident. If she decides that she wants to be the secretary of state, she should be the secretary of state.

BLITZER: Maxine Waters, thanks for coming in.

WATERS: You're welcome.

BLITZER: Appreciate it very much.

WATERS: You're welcome.

BLITZER: We're getting reports of a rash of pirate attacks off the coast of Somalia, in East Africa. Now there are reports they've hijacked their biggest target ever.

We're going to give you the details and show you some of the dramatic pictures as well.

And with just about two months until he leaves office, President Bush is giving some political allies government jobs for life. We'll tell you what's going on, on that front.

Stay with us. You're in THE SITUATION ROOM.


BLITZER: All right. Want to go right back to Ed Henry. He's in Chicago working the story about who might become the next attorney general of the United States. And give us the news, Ed.

ED HENRY, CNN WHITE HOUSE CORRESPONDENT: Well, Wolf, two officials now confirming to CNN that in fact Eric Holder is the president-elect's choice to be attorney general and that Eric Holder, a prominent Washington attorney, has accepted that. One official telling that to my colleague John King. One official telling me as well.

Officials for the record are still saying that it's not a done deal, but we are told that it's just going through the final vetting process. And in fact, this is Barack Obama's choice, it's been offered, and he has accepted it.

As you mentioned before, Eric Holder will be the first African- American attorney general. Obviously it would be an historic nomination.

He is a prominent attorney, and he really was well known in recent months for being co-chair of the vice presidential vetting process, along with Caroline Kennedy. That's where a lot of people got to know him. He did face some controversy when he was deputy attorney general in the Clinton administration for not stopping that controversial pardon of Mark Rich, but he was never really fully blamed for that, but just faced some criticism for not stopping that pardon in the final days of the Clinton administration.

Interesting that this is yet another prominent Clinton-era official who is going to be in the upper echelons of the Obama administration. And I should note as well that Eric Holder, prior to being in the Clinton administration, was a very prominent and well- respected federal prosecutor. And I can tell you, my initial phone calls to Democrats on Capitol Hill, they are receiving this news very well and suggesting that they think, at least in the early stages, that his confirmation could go well in the Senate -- Wolf.

BLITZER: The whole notion -- you know, obviously he served in the Clinton administration as the deputy attorney general under Janet Reno when she was the attorney general. But during the primaries, he was a major supporter of Barack Obama and not Hillary Clinton. Is that right?

HENRY: Absolutely right. And it's interesting that this follows on what we reported late last week about Greg Craig, the former Clinton impeachment counsel, now going to be chief counsel at the White House for Barack Obama.

On one hand, it may be somewhat surprising that so many Clinton officials who went with Barack Obama will no be in the Obama administration, and, you know, that he has so many Clinton veterans when he's trying to turn the page. But on the other hand, as you know, Bill Clinton was the last Democratic president. That's essentially the farm team, Wolf. That's where a lot of people cut their teeth in politics.

And now that a new Democratic administration is coming back, they are going to be coming, a lot of them, from the Clinton administration, like Rahm Emanuel, the incoming chief of staff. And you'll also remember when Bill Clinton came to power, Democrats had not been in the White House since Jimmy Carter. A lot of Cater veterans came into the Clinton White House. It's that same kind of cycle we're seeing played out once again -- Wolf.

BLITZER: Stand by, Ed. Our Chief National Correspondent John King is here in THE SITUATION ROOM as well.

So you are hearing what Ed is hearing, it's basically a done deal.

JOHN KING, CNN CHIEF NATIONAL CORRESPONDENT: A done deal, except for the formalities in the process, Wolf. And you've been through many of these.

There's a vetting process under way. They go through financial information, they go back through your record, his involvement in the Mark Rich pardon back in the Clinton days. It's all being looked at.

But they have now reached a comfort level. They still need to finish all the paperwork and the review, but President-elect Barack Obama has reached the comfort level where he has said to Eric Holder, I want you to be my attorney general. And Eric Holder, I'm told, has said, "I would be grateful for the opportunity, sir."

They just need to check the final box at the end to have an official job offer. But that could wait. That could be -- they may not announce this actually until the first week in December or so. Now that it's out, maybe they'll change the plan. But they wanted to do the economic team and the national security team first.

BLITZER: And obviously the Department of Justice a major part of that national security team as well. He knows the Justice Department. He was Janet Reno's deputy during the Clinton administration. He's also a former U.S. attorney, so he was a highly respected, as Ed points out, prosecutor as well.

KING: And that is one of the reasons the Obama transition team and the president-elect wanted Eric Holder. Remember how critical the Democrats have been of the Bush administration, of Gonzales and Bush, saying there was incompetence, that they didn't have a strong manager. The criticism over the years has been it's a very difficult bureaucracy to run and administer, they want someone who from day one knows the halls, knows how the process works, knows the system around the country, because one of the Democratic criticisms of the Bush administration has been that they over-politicized the department and they didn't have a sense of what it does and how to keep the pieces working together. They believe Eric Holder, because of that experience in the Clinton days, knows how on day one to take charge, to make the trains run on time.

BLITZER: Good. Stand by, John, because we're going to talk more about this. That's coming up.

Also, Barack Obama has promised to repeal the "Don't Ask Don't Tell" policy involving gays in the U.S. military. So how soon may gay troops be able to come out of the closet? We'll take a closer look. Jamie McIntyre working that story.

Also, one day after meeting with Barack Obama, John McCain is now back here in Washington. His role in the next Congress, that's just ahead in our "Strategy Session" as well.

And African-Americans in Congress. There's great pride in the Congressional Black Caucus over the election of Barack Obama. We'll tell you what's going on right here in THE SITUATION ROOM.


BLITZER: To our viewers, you're in THE SITUATION ROOM.

Happening now, Catholic anger toward Barack Obama. One Vatican official says the president-elect's stance on abortion is, in his words, "hostile, violent towards unborn children." But what about the American Catholics who helped to elect Barack Obama? Brian Todd standing by with a full report.

Also, Republican infighting. Former presidential candidate Mike Huckabee now slamming his former primary campaign rivals in a brand new book. We're going to give you the details about what he is saying and what it might mean about the 2012 race for the Republican nomination.

And Barack Obama's role model. The president-elect says he has been studying Abraham Lincoln, and there are some striking parallels. We're going to tell you about that and a lot more.

I'm Wolf Blitzer. You are in THE SITUATION ROOM.

President-elect Barack Obama has pledged to lift the ban on gays serving openly in the United States military, but he's determined not to repeat the political blunder of President Clinton, whose efforts back in 1993 backfired, resulted in a policy which lead to thousands of gays eventually being expelled from the U.S. Armed Forces.

Our Senior Pentagon Correspondent Jamie McIntyre is looking at this story. How quickly might it be, Jamie, before the president- elect, after he becomes president, gets his way and eliminates the "Don't Ask Don't Tell" policy?

JAMIE MCINTYRE, CNN SR. PENTAGON CORRESPONDENT: Well, Wolf, we have been talking to gay rights advocates and their supporters on Capitol Hill, and they think next year might be the year the restrictions on gays in the military are repealed.


BLITZER: If you think it is time to get rid of the "Don't Ask Don't Tell" policy in the U.S. military, raise your hand.

MCINTYRE (voice-over): On CNN last year, President-elect Barack Obama raised his hand to show allowing gays to serve openly in the military is a change he believes in. But two months ago, Obama signaled he would move cautiously, telling a gay newspaper he would first get the military on board.

(BEGIN AUDIO CLIP) SEN. BARACK OBAMA (D-IL), PRESIDENT-ELECT: Although I have consistently said I would repeal don't ask/don't tell, I believe that the way to do it is to make sure that we are working through processes, getting the Joint Chiefs of Staff clear in terms of what our priorities are going to be.


MCINTYRE: Gay rights activists say it is important for the new president to avoid the ham-fisted effort President Clinton tried in 1993, when he naively promised to lift the ban by executive order. The roiled the Pentagon brass, including then Joint Chiefs Chairman Colin Powell, and provoked a fierce backlash from conservatives in Congress.

As a result, Congress stripped President Clinton of his power to change the policy, and forced him to accept the don't ask/don't tell compromise, a law that can only be repealed by Congress.


MCINTYRE: But, after 15 years and four wars, attitudes in the Pentagon and among the public have changed dramatically.

A "Washington Post"/ABC News poll this summer found, 75 percent of Americans support allowing gays to serve openly, compared to only 45 percent back in 1993. And a House bill to replace don't ask/don't tell with a policy of non-discrimination has 149 co-sponsors.

REP. ELLEN TAUSCHER (D), CALIFORNIA: The key here is, is to get bills that pass the House the Senate that we can get to president- elect Barack Obama to sign. I think that we can do that in certainly the first year of the administration.


MCINTYRE: Now, Wolf, when Barack Obama takes office in January, obviously, this is not going to be the first thing he's going to tackle. He has got bigger problems, the economy, two wars, things like closing Guantanamo. But there is an increasing feeling here at the military that -- that things have changed over the years.

Many officers know gay people who have served in the military honorably. And they are beginning to think that the example of Great Britain and Israel, where gays can so -- serve openly, can also work in the U.S. as well -- Wolf.

BLITZER: So, basically, what I hear what you saying is, over at the Pentagon, when you are walking through the corridors over there, folks are beginning to say, you know what, this is going to happen; they might as well deal with it?

MCINTYRE: And, you know, what you hear them say a lot of times is, you know what, it is not that big a deal; it is not that big a problem. And that was the big worry back in the early '90s, that it was going to affect unit cohesion, that people wouldn't be able to fight. I think they have found that that is simply not the case.

BLITZER: Jamie, thanks very much -- Jamie McIntyre over at the Pentagon.

With only about two months left in his presidency, President Bush is now taking some steps to try to solidify some of his administration's more controversial regulatory and policy initiatives and in the process, protect the jobs of some of his key allies. Our White House correspondent, Elaine Quijano, is looking into the story.


QUIJANO (voice-over): Just as the famous gopher in "Caddyshack" burrowed his way to safety, burrowing in government work means going from a politically-appointed job to safety of a career civil service position, one that expert Paul Light says is tough to lose.

PAUL LIGHT, NEW YORK UNIVERSITY: Impossible. Once you enter the civil service, you can remain until you retire, unless there is, you know, malfeasance or some sort of poor performance that is so significant that you can be removed through the disciplinary process.

QUIJANO: As "The Washington Post" first reported, between March 1 and November 3, 20 political appointees under the Bush administration were approved to become career civil servants.

DANA PERINO, WHITE HOUSE PRESS SECRETARY: We should want people who have worked in the administration who think they might want to make their careers in government. We have a lot of smart people all across the government with -- with a lot of expertise.

QUIJANO: The Bush administration is not alone. In the last 12 months of Bill Clinton's presidency, 47 political appointees were approved for civil service jobs.

Paul Light, author of the "A Government Ill-Executed," believes burrowing should be abolished.

LIGHT: This is a backdoor way of leaving an imprint on an administration. You are generally putting somebody in who was selected through a process that rewards political loyalty, campaign service, and places expertise at the back of the line.


QUIJANO: Now, Bush aides insist, as a matter of policy, the administration has not encouraged political employees -- appointees, rather, to seek career positions in order to further the president's policies. And they note, applicants for those permanent positions are screened by career employees -- Wolf.

BLITZER: Elaine Quijano at the White House -- thanks, Elaine. So, how much can Barack Obama trust some of the people around him? Leaks are typically a major problem for any administration, but can the incoming president keep some secrets under wraps? Stand by.

You or someone you know may be coming to Washington for this historic inauguration, but, with millions of people expected to come to Washington, what is it going to take to keep everyone safe?

And Barack Obama's incoming White House chief of staff -- there he is, Rahm Emanuel -- we're going to tell you about his ties to celebrities, especially his brother.

Stay with us. You're in THE SITUATION ROOM.


BLITZER: The enormous size of the crowds expected in Washington for Barack Obama's inauguration on January 20 might only be matched by the enormous size of the security efforts.

Let's go to our homeland security correspondent, Jeanne Meserve. She's telling us what is going on with all of these preparations.

It's an enormous operation under way. What do we know, Jeanne?

JEANNE MESERVE, CNN HOMELAND SECURITY CORRESPONDENT: Well, an inauguration always draws a crowd, but this one, Wolf, may be like no other.



MESERVE (voice-over): The National Mall is made for public gatherings, both celebrations and protests, but, as the city gets ready for January 20, the mayor expects something unprecedented.

ADRIAN FENTY (D), MAYOR OF WASHINGTON, D.C.: We should be prepared, as a city, for, you know, in the range of three to five million. You know, we don't want to be caught by surprise.

MESERVE: As a candidate, Barack Obama could draw crowds of 100,000 -- 240,000 gathered in Chicago's Grant Park to hear his acceptance speech. And there is consensus that the historic swearing- in of the nation's first African-American president will be huge.

Washington does inaugurations every four years. And the Secret Service says it can adapt existing plans and do a little innovation to make the swearing-in and the inaugural parade safe and secure, no matter how big the crowd.

UNIDENTIFIED MALE: We have got subcommittees specific to airspace security, to prevention and to crisis management, to civil disturbance. And on each of those subcommittees, we have got members of the federal government, from the military, from the city.

MESERVE: Will Obama take a page from Jimmy Carter or Bill Clinton, and walk through the throngs?

UNIDENTIFIED MALE: We would prefer, of course, that he stay in the car, but that's not our call.

MESERVE (on camera): Whose call is it?


MESERVE (voice-over): How will everyone else get around in a city so jampacked with people? Metro, the city's mass transit system, says it is still planning, but promises it won't shut subway doors, no matter how many people show up.


MESERVE: Although everyone expects a crowd, we were unable to find anyone else estimating the three to five million the mayor is. One official said one million. Others say it is just too early to know just how many people are going to show up -- Wolf.

BLITZER: A million here, a million there, that's still, no matter what you say, a lot of folks.

All right, thanks very much, Jeanne, for that.

Let get some perspective on all these estimates. About 250,000 people heard Martin Luther King Jr. give his famous "I Have a Dream" speech here in Washington in 1963. More recently, organizers say, about 1.5 million packed onto the mall for the March for Women's Lives rally back in 2004.

And, as you just heard, Washington's mayor says they are planning for three million to five million people on January 20, which got us to thinking, if five million people actually show up for president- elect Obama's inauguration, could they all fit on the Mall?

The answer? Yes. But they would each have just about one square foot of ground to do stand on. You do the math.

Another question, where will they sleep?

Our Internet reporter, Abbi Tatton, has been looking into this part of the story.

It's a good question, Abbi.

ABBI TATTON, CNN INTERNET REPORTER: Wolf, there are only so many hotel rooms in Washington, right? So, the local residents know it, and they are going on the hundreds to Web sites like craigslist to offer their homes for a few days, for a week, and for a fee.

We're going to take a look at what your money can buy you for inauguration week right now. Going to Capitol Hill here, right near where the swearing-in ceremony is going to take place, $15,000 is one of the ads for a three-bedroom townhome there. A couple of miles away, we saw that it wasn't just homes being offered to people coming into town. A catamaran was also on offer for a few days, up to a week, for $5,000, if you want to stay at a local marina.

Now, if that is a little bit out of your price range, look a little bit further out of town, going to Silver Spring, Maryland, still on the Metro. And if we can bring up the picture -- there's the catamaran -- we are going a little bit slower there. If we could pull up the picture there of a backyard, where someone is saying that you can pitch a tent and stay there for free, though, if you want to use the house, it's going to cost you $100 per adult per night.

Wolf, we have seen people putting on their properties as far away as Baltimore, West Virginia. The owner of a timeshare in Williamsburg, Virginia, which is two-and-a-half-hours away, they're saying that they're doubling the rates for the week, and they have already got inquiries.

BLITZER: Fifteen thousand on Capitol Hill for a week. Fifteen thousand for a three-bedroom townhouse?

TATTON: And they -- they haven't got -- haven't got any responses yet, but she -- she thinks she is going to get it.

BLITZER: Those people who live there, they can go on vacation, go someplace nice...

TATTON: Right.

BLITZER: ... come back a week later, and probably have a lot of money left over as well. All right, Abbi, thanks very much.

He might be saying the Mac is back. John McCain returns to his job in the U.S. Senate. So, what is next for him?

And you are fired. It appears they will be -- that will be the fate of anyone caught leaking on Barack Obama's transition team. How much can the president-elect trust the people around him not to leak?

Stay with us. You're in THE SITUATION ROOM.


BLITZER: Senator John McCain is back on Capitol Hill today for the first time since losing his presidential bid. Will he have a major role in the new Congress?

Joining us now for our "Strategy Session," Democratic National Committee adviser Jamal Simmons, and Republican strategist, our CNN political contributor Leslie Sanchez.

Leslie, what do you think? The Mac is back, as they say.


BLITZER: What is going to be his role?

LESLIE SANCHEZ, CNN POLITICAL CONTRIBUTOR: Well, I have talked to several of the top Senate staffers. And they say, overwhelmingly, Senator McCain will be welcomed with open arms. They say it's going to be a mixed back.

In some lights, they think he will have a high profile on some of those issues like climate change, where it's going to probably work better to president-elect Barack Obama's positioning. You know, he supported several positions that they think there's going to be compromise.

Yet, on other areas, probably national security and defense, he's going to be more in line with Republicans like McConnell and Kyl.

BLITZER: What do you think, Jamal, because he had a good meeting, by all accounts, yesterday with the president-elect?


And I just want to correct one thing. I'm not a DNC adviser anymore. I'm just another one of these strategists out here.


BLITZER: So, you have left -- you have left the DNC?

SIMMONS: I have. I have.

BLITZER: But you are still a Democrat?


SIMMONS: I'm still a Democrat.

BLITZER: All right.


SIMMONS: Exactly.


SIMMONS: Thanks for clearing that up, Wolf.


SIMMONS: So what I'm hearing from some of my sources -- I talked to some friends in the business community today -- they think that Senator McCain is probably going to be focusing on things like energy, as well as national security, when he gets back.

But then you talk to some of the other folks in the Senate, and what they tell you is that, you know, there are over a dozen people in the Senate right now who have run for president before. So, coming back from the campaign trail as a former presidential nominee does not entitle you to be able to direct policy. People like Mitch McConnell are not going to wait to make decisions to talk to -- talk to John McCain first.

So, it's going to be a little bit of a mixed bag when he gets back there, and I expect some adjustment on his part.

BLITZER: Is it unrealistic, Leslie, to think that John McCain will eventually emerge as a key Barack Obama ally in the Senate?

SANCHEZ: I think, in some cases, he will. And I think those are probably areas that the media is going to illuminate.

But I wonder if they're going to illuminate as much the times that he's counter to those policies. One thing about the Senate is, you -- any senator can take any issue and any platform at any time. And it has a history of welcoming back -- look at John Kerry, Hillary Clinton. They can do as much or as little as they desire.

I think the onus is on Senator McCain. He has a strong reputation of both -- working on both sides. And I think he will continue to do that.

BLITZER: On the Obama transition, there's a story out there, report, Jamal, that the -- the head of the transition, the former White House chief of staff, John Podesta, has told staffers, you know what? You leak, you are fired. You have got to keep this close to the vest, all these sensitive names out there, who is going to be getting jobs.

What do you make of this?

SIMMONS: Well, I talked to some people over at the transition office today, and they have not hired Jack Bauer to come over there and start trying to plug the leaks. I don't think they are that focused on this.

This is -- there are a lot of reporters who are covering the transition. They're not a lot of information out there. So, people are telling real stories and also kind of making small things into bigger things.

But when it comes to this, welcome to Washington, Senator Obama. This is one of the reasons why I think he based his campaign in Chicago, to get it out of this -- kind of the Washington swarm of reporters and operatives.

But, you know, now they are back in Washington, and people are -- people are talking to their friends.

BLITZER: And there are people already being named, at least in the transition, and maybe eventually in the White House, who are pretty good at dealing with reporters. They know how to leak.


BLITZER: They were pretty disciplined during the -- during the campaign, Leslie, but they know how to deal with the press.

SANCHEZ: Wolf, you are exactly right. They do. But it's also, how do you take that mammoth operation, that had so much direct contact with people, and move it into a government apparatus? Some of it is going to work. Some of it is not. People and presidents have been dealing with leaks going back to George Washington.


SANCHEZ: I mean, anybody will tell you that in -- in here. And -- and some leaks are good, if it's -- if it is something that's breaking the law or, you know, affects our national security.

The question is, there's examples of presidents doing well and controlling that message. Bush 43, this current president, you know, you had Karen Hughes, who said she was reading those phone records, and you had to ask permission to talk to anybody. It was very disciplined.

But there's cases of Ronald Reagan. He would leak to "The Washington Post" and then "The Washington Times" back and forth to move policy. So, it depends how they use...


BLITZER: And my experience, as a reporter in Washington, Jamal, for a long time is that the most sensitive leaks, potentially the most embarrassing and damaging leaks, they don't come from mid-level officials. They don't come from junior officials. They come from right near the top. But that's just my experience.

SIMMONS: Well, yes, that -- that -- that is typically, I think, the way a lot of this happens. And here's -- and here's also what happens. I think people now are focusing -- you hear the story today about Eric Holder coming in the as the Justice -- perhaps as the Justice A.G. You know, people are focusing on pretty big things over at the transition office. And when you talk with people there, this is just not something that is really on the big radar screen over there right now.


BLITZER: We will leave it on that note. We will see what happens. I suspect there are going to be a lot of leaks, because there always are.

Guys, thanks very much for coming in.

SANCHEZ: Exactly right.

SIMMONS: Thank you.

BLITZER: Barack Obama is set to make another history-making move -- sources telling CNN the president-elect wants Eric Holder to become the first African-American attorney general of the United States. We will have the latest. And what a Vatican cardinal is now saying, it's certainly raising eyebrows. What would make him say that Obama's agenda is apocalyptic?

And time for a recount in Minnesota. We have the latest on that extremely tight Senate race -- that and a lot more coming up, right here in THE SITUATION ROOM.


BLITZER: It's the moment that, among other things, will long inspire this question: Where were you when? That's what many Americans will long ask about the moment the United States elected its first African-American president. Now some black members of Congress are openly sharing how moving that moment was for them.

Let's go to Dan Lothian. He's in Boston, watching this story for us. Dan, these are members of the Congressional Black Caucus.

DAN LOTHIAN, CNN BOSTON BUREAU CHIEF: That's right, Wolf. They were here for a forum that dealt with the issue of race in the aftermath of a historic election.



LOTHIAN (voice-over): The Congressional Black Caucus unplugged, deeply moved by Barack Obama's victory.

REP. DANNY DAVIS (D), ILLINOIS: I can tell my grandchildren that these hands that I used to use to pick cotton, I used to help pick a president.

REP. JOHN LEWIS (D), GEORGIA: That night, I must tell you, I did cry. I think I had what I call an out-of-body experience.


LEWIS: I jumped. I shouted for joy. I didn't think my feet were ever going to touch the ground again.

REP. JAMES CLYBURN (D), SOUTH CAROLINA: And I looked first in the face of my daughter, my eldest, and tears were streaming down her face. I lost it at that moment. And I think I was shedding tears of vindication.

LOTHIAN: As Obama and his family thank the nation, most members say they also cried. Doubters became believers.

REP. DIANE WATSON (D), CALIFORNIA: And my emotion came about because I did not believe there were areas in the country that were ready to vote for a black man. And, so, it took me hours to really let it soak in that he had won.

LOTHIAN: As they talked the historic election at Williams College in Massachusetts, James Clyburn, the highest-ranking black leader in Congress, admitted, he didn't always believe his own rhetoric, that pep talk to his children and grandchildren.

CLYBURN: As I told them that they could grow up to be whatever they wanted to be, quite frankly, they didn't believe it, and I didn't believe it when I was telling them.


LOTHIAN: He sure does now. And, soon, with a black family in the White House, the Congressional Black Caucus hopes a new picture will emerge.

DEL. DONNA CHRISTENSEN (D), U.S. VIRGIN ISLANDS: It's going to have a transformative effect, impact on how people around this country see the African-American.

LOTHIAN: Like many Americans, they have high expectations of president-elect Obama, who must tackle not a black agenda, but an American agenda, the battered economy, energy, education.

REP. SHEILA JACKSON LEE (D), TEXAS: But this will require some heavy lifting. Let's help him. We are in a historic moment with a historic opportunity, with historic responsibility.

LOTHIAN: And one of those responsibilities they will focus on out of the gate, getting people back to work.

LEWIS: I think the number-one thing is jobs, number two, jobs, number three, jobs. It's going to be jobs, jobs, jobs.


LOTHIAN: They won't always agree with Obama on every issue. And, as one congressman said, "We're not going to call him 'Brother President,'" but they're inspired by what Obama represents and the potential to turn things around -- Wolf.

BLITZER: And, as you point out, Dan, there's a lot of history there. Many of these members of the Congressional Black Caucus, they lived through some of those moments on the civil rights movement. And they can step back and really appreciate what's going on right now.

LOTHIAN: They really can. And that's the reason this moment was so emotional for all of them.

BLITZER: Dan Lothian working the story in Boston for us -- thanks, Dan, very much.

Let's go back to Jack. He's got "The Cafferty File" -- Jack.

CAFFERTY: It's going to be a pretty interesting two, three years, I think.

The question this hour is, what's the proper role for Hillary Clinton in President Obama's administration?

Vera writes from Baltimore: "From my vantage point, she shouldn't have a role. She ought to stay in the Senate and help get Obama's legislation passed. If she becomes secretary of state, she will need someone to actually manage the State Department better than she managed her campaign."

Paula writes: "Hillary is the right choice for secretary of state. I love the fact that Obama feels secure enough to choose people who won't just be yes-people. I think he is smart to look to people who may not necessarily agree with him all of the time."

Mason in Tuscaloosa, Alabama: "Hillary Clinton would be great in Obama's Cabinet. That way, she can continue with her interpretation of Obama's message: change you can Xerox. Come on, now. If he appoints her, he might as well give Dick Cheney a job. That's not change. That's more of the same."

Maria writes: "Adviser only. Bill Clinton has too many hands in foreign cookie jars for the Clintons to be objective and not a liability to Barack Obama. She is an excellent politician, but an Achilles' heel to the Obama camp because of her husband."

Tom in Tucson writes: "I would think that secretary of health and human services would be the ideal place for her. Senator Clinton has always made health care one of her top priorities. It may not be as sexy as the secretary of state, but, with an annual budget of over $700 billion, it is certainly influential and affects millions of Americans in a very personal way."

Curt writes: "Any role she wants, and he ought to pay off her debt. He wouldn't be where he is without her."

And William in Vero Beach, Florida: "Getting Hill off the Hill also puts the chill on Bill. He wouldn't dare engage in international mischief if she were secretary of state -- or would he?"

If you didn't see your e-mail here, you can go to my blog at Look for yours there, among hundreds of others -- Wolf.

BLITZER: Jack, thank you.

And, to our viewers, you're in THE SITUATION ROOM.

Happening now: breaking news: President-elect Barack Obama taps the Justice Department veteran Eric Holder to become the next attorney general of the United States. We're taking a closer at his record, what he will bring to the troubled department. And we will talk to someone who worked with him. Stand by.

Also, a scathing rant against Barack Obama from a rather surprising source, a Roman Catholic cardinal -- the story behind his diatribe against the president-elect.

And Hillary Clinton possibly Barack Obama's secretary of state -- we go inside the vetting process and talk about the pros and cons of all of this with James Carville and Kevin Madden.

I'm Wolf Blitzer. You're in THE SITUATION ROOM.