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The Situation Room
Tens of Thousands of American Jobs Wiped Out; Joe Biden's Influence
Aired January 26, 2009 - 18:00 ET
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
WOLF BLITZER, CNN ANCHOR: And, to our viewers, you're in THE SITUATION ROOM.
Happening now: tens of thousands of American jobs wiped out in a single day. This hour, is President Obama doing enough to try to jump-start the economy? The best political team on television is standing by.
And the Obama White House sees green -- the president's new moves promoting fuel efficiency and a healthier planet. Will the troubled auto industry, though, pay a price in the short term?
And Joe Biden in the room, the vice president offering some new insight into his influence when the president makes some tough decisions.
We want to welcome our viewers in the United States and around the world. I'm Wolf Blitzer. You're in THE SITUATION ROOM.
A really horrible day for U.S. workers, and it's getting worse. Add Texas Instruments to the list of big companies announcing major job cuts today. The tech company says it will slash 3,400 jobs, six firms eliminating more than 40,000 positions on this day alone. President Obama says he sees the bigger picture for the economy and for families.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: Over the last few days, we've learned that Microsoft, Intel, United Airlines, Home Depot, Sprint Nextel and Caterpillar are each cutting thousands of jobs.
These are not just numbers on a page. As with the millions of jobs lost in 2008, these are working men and women whose families have been disrupted and whose dreams have been put on hold.
(END VIDEO CLIP)
BLITZER: President Obama announced major moves today that he says will help rescue the economy and also help save the planet. We are going to have extensive remarks from the president of the United States, what he had to say on these critical issues. That's coming up in a little while. Stand by for that.
But let's go to the White House right now. Our correspondent Dan Lothian has much more on this important development today -- Dan.
DAN LOTHIAN, CNN WHITE HOUSE CORRESPONDENT: That's right, Wolf.
Well, you know, the president really was stepping out on two fronts today, focusing and pushing that economic stimulus plan, but also pushing his green plan, turning to his Environmental Protection Agency to try to review some of the existing environmental policies.
These are changes that some believe could be devastating for the auto industry. But Mr. Obama sees it as a good long-term solution.
(BEGIN VIDEOTAPE)
LOTHIAN (voice-over): President Obama is leaning on the cash- strapped auto industry to help clean up the environment.
OBAMA: Our goal is not to further burden an already struggling industry. It is to help America's automakers prepare for the future.
LOTHIAN: And preparing for that future begins with a second look at states like California, which wants to create its own tougher auto emissions standards, a request the Bush administration denied.
Mr. Obama also wants to speed up the process of getting higher fuel efficiency cars on the road. Congress set the new bar at 35 miles per gallon by 2020. The president wants his administration to start making that happen with 2011 models.
ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: What ultimately we will come up is something that moves along the twin goals of ensuring a strong manufacturing sector while at the same time ensuring that we take the necessary steps to reduce our dependence on foreign oil.
LOTHIAN: This green push came on a day that saw more job losses, companies like Caterpillar and Home Depot laying off thousands of workers.
The president acknowledged the grim numbers as he again pushed for the $825 billion stimulus plan.
OBAMA: This is the boost that our economy needs and the new beginning that our future demands.
LOTHIAN: But there is still skepticism on Capitol Hill, where Mr. Obama will be meeting with House and Senate Republicans on Tuesday. Some key members, like Senator John McCain, have already said they can't support the stimulus package in its current form.
(END VIDEOTAPE)
LOTHIAN: So, McCain and other Republicans are promising that they will not be able to vote for this; they will vote no, unless there are some significant changes -- the sticking point for Republicans again, not enough tax cuts and too much spending.
So, that's the climate, as the president heads up to Capitol Hill tomorrow to talk with Republicans. White House Press Secretary Robert Gibbs saying that he does really want to seek their input. He's listening to their ideas. He will sit down and consider those ideas.
He doesn't really need Republicans to make this happen, but I was talking to a senior administration official and he told me that the president really feels that this could instill confidence in his administration if he can get bipartisan support -- Wolf.
BLITZER: And we're going to hear extensively from the president. That is coming up soon.
Dan Lothian at the White House, thanks very much.
You're looking at these live pictures from the floor of the United States Senate. The confirmation roll call of Timothy Geithner as the next secretary of the treasury, that has now started. They are doing the roll call. Once we get the final results, we will tell you what's going on. We expect that momentarily. We will tell you if -- if Timothy Geithner will be confirmed by the full Senate. He was confirmed by the Senate Finance Committee.
We expect he will be confirmed by the Senate as well. Stand by. We will go there live once we know the final roll call. Timothy Geithner, he's -- the roll call on his confirmation now under way.
Meanwhile, potential changes regarding emissions standards are indeed a welcome change in the state of California.
Let's go there to Los Angeles.
CNN's Thelma Gutierrez is working this story for us.
Thelma, what's the latest?
THELMA GUTIERREZ, CNN CORRESPONDENT: Wolf, I can tell you this is good news for California environmentalists, who have been fighting for tougher emission standards. They say that President Obama is now making good on a campaign promise. Now, as for California commuters, you take a look behind me, you see this crazy freeway here.
People here are very happy. They say it's about time that automakers are forced to roll out vehicles that are not only cleaner, but have a better driving range.
(BEGIN VIDEOTAPE)
GUTIERREZ (voice-over): Robert Metcalf dumpster dives for restaurant waste to convert into fuel that he puts into the gas tank of his '83 diesel Mercedes. Metcalf says he does this to be green, but also to survive the price of gas at the pump.
He says he couldn't be happier that President Obama has asked the EPA to reconsider what California and 13 other states have been fighting for for years, the right to set their own tougher standards to reduce carbon dioxide and other greenhouse gas emissions. ROBERT METCALF, CALIFORNIA COMMUTER: California's always led the emissions standards. And so I think that's appropriate, because it's time for the U.S. to lead the world.
GUTIERREZ: Governor Arnold Schwarzenegger says, California is ready.
GOV. ARNOLD SCHWARZENEGGER (R), CALIFORNIA: California finally has a partner and an ally in Washington.
GUTIERREZ: But the auto industry argues that newer cars already meet rigorous environmental standards and that the timing couldn't be worse to put additional demands on the ailing industry.
KARL BRAUER, EDITOR IN CHIEF, EDMUNDS.COM: To pile on top of that additional expense in the form of emission controls and standards is one of the worst things you could do.
GUTIERREZ: On top of that, Leo Hagen, who sells Ford in California, says it's ridiculous to allow individual states to come up with their own rules.
LEO HAGEN, SALES MANAGER, HOLLYWOOD FORD: We do need a level field for all states, so that the manufacturers, when they spend millions and millions of dollars to have a standard, it's for all the states.
(END VIDEOTAPE)
GUTIERREZ: Now, the EPA would have several months to reach a decision, and the federal fuel standards would go from -- would all the way up to 35 miles per gallon by 2020 -- Wolf.
BLITZER: A story, an important story for all of us. Thanks, Thelma, very much.
A little bit more perspective right now on just how much our -- greenhouse gases come from cars and trucks. The EPA, the Environmental Protection Agency, says transportation produces one- third of all carbon dioxide emissions in the United States. CO2 is one of the biggest contributors to climate change.
When we take a closer look at the transportation piece of the pie, we find that 62 percent of those emissions, 62 percent, are coming from cars and trucks.
Let's go back to Jack. He has "The Cafferty File" -- Jack.
JACK CAFFERTY, CNN ANCHOR: President Obama had hoped that the political capital he won on the campaign trail would pay off in Washington and allow him to push through his emergency stimulus bill without a lot of hassle.
But, after less than one week in office, he's run headlong into the partisan battles that he was trying to eliminate in the nation's capital, the new president facing sharp resistance to his $825 billion stimulus package the House is expected to consider on Wednesday. Questions about how the money will be spent stand in the way.
And that's not surprising, when you consider the mystery of the $750 billion Wall Street bailout President Bush signed off on last year. We still don't know where a lot of that money went. President Obama is pulling out all the stops to try to get everybody on the same page. He's meeting with his economic advisers, talking with lawmakers on Capitol Hill.
He continues to tell the American people how bad things are and warns them to brace for things to get worse. And it's not just the stimulus package that the president's having trouble with. Republicans are holding up the confirmation of his attorney general, Eric Holder. And they can't be thrilled that President Obama is signing one executive order after another undoing the policies of his Republican predecessor, George W. Bush.
These are all indications it's not going to be the smooth sailing President Obama had in mind or perhaps wished for.
Here's the question: Is the spirit of bipartisanship already dead in Washington less than a week into the new president's first term? Go to CNN.com/caffertyfile and post a comment on my blog.
BLITZER: And we're hearing -- standing by to hear more from the president of the United States extensively in his own words on what's going on right now. Jack, thank you.
If you're confused about plans to fix the economy, should you look to the heavens for understanding?
(BEGIN VIDEO CLIP)
REP. JOHN BOEHNER (R-OH), HOUSE MINORITY LEADER: Oh, my God.
(END VIDEO CLIP)
BLITZER: Some of the smartest people are confused by plans to try to jump-start the economy. We are going to give you a fairly simple way to understand it.
Joe Biden wants to make it clear the days of Dick Cheney in the White House are over. And he explains exactly the kind of vice president he wants to be.
And Americans are addicted to foreign oil. Now President Obama lays out in detail his first steps toward breaking that habit.
(BEGIN VIDEO CLIP)
OBAMA: I cannot promise a quick fix. No single technology or set of regulations will get the job done.
(END VIDEO CLIP)
(COMMERCIAL BREAK) BLITZER: This is a critical week for the president's economic rescue plan. Senate committees take up the $825 billion package tomorrow. The full House may vote on its version of the plan Wednesday. But even as the legislation moves forward, not everyone is clear about what's in it.
Let's bring in our national political correspondent, Jessica Yellin.
It's pretty complicated stuff, Jessica.
JESSICA YELLIN, CNN CONGRESSIONAL CORRESPONDENT: It really is, Wolf. All of official Washington is talking about the stimulus as if it's the magic antidote to our economic woes, but it's almost amusing to note how many folks just don't understand how it's supposed to work. Here's an attempt to clear up some of that confusion.
(BEGIN VIDEOTAPE)
YELLIN (voice-over): If you're confused about the stimulus, there's good reason.
BOEHNER: Oh, my God.
YELLIN: From Capitol Hill to the White House, the discussion is not so clear.
GIBBS: They found that the spend-out rate on 120 days was actually less than a spend-out rate on 180 days, right?
YELLIN: Uh, what? Even journalists are getting schooled on air. On ABC's "This Week," a Nobel Prize-winning economist corrected a reporter who said this about one of the president's economic advisers.
(BEGIN VIDEO CLIP, "THIS WEEK")
SAM DONALDSON, ABC NEWS: She couldn't find that stimulus programs had really worked in any major sense. But I think it's right..
(CROSSTALK)
UNIDENTIFIED MALE: That's not right, actually. No, it's not...
(CROSSTALK)
DONALDSON: Am I close enough for government work?
UNIDENTIFIED MALE: No, actually.
(END VIDEO CLIP)
YELLIN: And it doesn't help that partisans are spinning the numbers. For example, Republican critics have been citing an official-sounding congressional report claiming that only 40 percent of the stimulus would go into the economy right away. The White House quickly rejected that finding. What are they talking about? For the stimulus to work, you want it to go out the door fast and you want every government dollar to generate lots of spending. The $825 billion proposed stimulus could be divided into three parts, $275 billion for tax cuts.
This money would get out the door fast, but, according to experts, gets limited bang for the buck. About $300 billion would be sent to states to pay for services and workers. That gets out the door pretty fast, and it gets good bang for the buck.
Another $250 billion would be spent on infrastructure, roads and bridges. This takes the longest to get out, but, in many cases, has the biggest bang for the buck.
Economists say, in all of this, we're in uncharted territory.
WILLIAM GALE, SENIOR FELLOW, BROOKINGS INSTITUTION: We sort of have no good options right now. And we're choosing the least bad option.
YELLIN: What if the stimulus doesn't work?
GALE: Well, that's a very good question.
(END VIDEOTAPE)
YELLIN: So, now, I mentioned that government study. It showed that only a part of the stimulus would be spent right away. That got a lot of play in the news. The politicians talked about it. That study only looked at one category of spending I talked about, infrastructure spending.
That's the spending that takes the longest to get out the door, so it didn't take into account, Wolf, all the other categories. We're expecting a complete analysis of the stimulus to come out of the Congressional Budget Office any minute now.
BLITZER: But they're going to vote as early as Wednesday in the full House? Is that enough time to really digest and absorb, understand an $825 billion package?
YELLIN: It's hard to say it is, but they say urgency is so essential right now, they have to get it done. So, maybe they don't know all the details, but they have got to move.
BLITZER: All right, we will see. You're right. They're up against the clock.
Thanks very much, Jessica, for that.
The vice president of the United States, Joe Biden, he is clearly going to play a critical role in what's going on, on the Hill in both the House and Senate.
Let's bring in our Brian Todd. He's been taking a closer look at the role that he's trying to carve out for himself.
Brian, what are you picking up?
BRIAN TODD, CNN CORRESPONDENT: Well, Wolf, as we speak, there are several big adjustments to new jobs being made at the White House. Joe Biden is making one of the biggest. And his adjustments are already grabbing attention.
(BEGIN VIDEOTAPE)
TODD (voice-over): He says it three times in the course of 55 seconds. When President Obama's heard from everyone else, his word carries extra weight.
JOSEPH BIDEN, VICE PRESIDENT OF THE UNITED STATES: Hopefully, I'm the last person in the room with every important decision he makes. The agreement he and I have is that I would be available for every single major decision that he makes in the room, essentially the last guy in the room when he makes these critical decisions.
TODD: Joe Biden says he won't reprise Dick Cheney's role as a policy-maker and admits it will be harder to hold his tongue in his new role as backroom confidante to the president. He struggled with it on his first full day on the job.
BIDEN: My memory is not as good as Justice Roberts', Chief Justice Roberts'.
(LAUGHTER)
TODD: A joke that left his boss visibly flustered, one of several episodes leading to questions like this from GOP strategist Karen Hanretty. "Can you be the last man in the room if you can't keep your mouth shut?"
An aide to the vice president says he knows the difference between speaking candidly and keeping confidence, a sentiment echoed by a former Biden aide.
NORM KURZ, FORMER BIDEN COMMUNICATIONS DIRECTOR: He's never given away any important secrets or any important information that was inappropriate. That's just -- it's not going to happen.
TODD: A White House official says Biden will start settling into that more prominent, but unseen adviser role in the coming weeks, including regular private lunches with the president, as he had last Friday.
Observers say there's little doubt Biden's 36 years in the Senate, foreign policy experience and Washington savvy bolster his gravitas for the role.
A.B. STODDARD, ASSOCIATE EDITOR, "THE HILL": He has been there so much longer than Barack Obama, and he brings a real treasure trove of knowledge and information about the tricks and tips of how to get here and there in the fastest, most solid way. (END VIDEOTAPE)
TODD: Observers say that's going to be critical in these first few weeks, as the president tries to get his stimulus package through Congress. Even though domestic policy's not his strongest hand, Biden will be counted on, they say, to help negotiate that on the Senate side, as chief of staff Rahm Emanuel will on the House side -- Wolf.
BLITZER: Brian Todd, thanks very much. He is watching the vice president of the United States.
The embattled Illinois governor about to be impeached -- he's already been impeached, actually -- but will he be convicted by the Senate? Today, he is accused of trying to sell a U.S. Senate seat. Today, he took his story to the news media.
(BEGIN VIDEO CLIP)
GOV. ROD BLAGOJEVICH (D), ILLINOIS: I'm here in New York because I can't get a fair hearing in Illinois, in the state Senate in Illinois.
(END VIDEO CLIP)
BLITZER: And what Rod Blagojevich said may have already gotten him in trouble.
Plus, a man who now has a mission -- the president's pick to work in the Middle East. We will tell you what's going on.
And, remember, we're standing by to hear from President Obama. He's speaking extensively on the current economic crisis.
(COMMERCIAL BREAK)
BLITZER: Karl Rove, the former president's top political adviser, back in the news right now, news I'm sure he's not very happy about.
Let's go to Capitol Hill. Brianna Keilar is getting the information for us.
What's going on, Brianna?
BRIANNA KEILAR, CNN CONGRESSIONAL CORRESPONDENT: Wolf, we have just learned that House Judiciary Committee Chairman John Conyers has subpoenaed Rove to testify before Congress actually a week from today, on Monday, about his alleged role in politicizing of the Bush administration Department of Justice, having to do with the firing of those U.S. attorneys, having to do with the indictment of the Democratic former Alabama Governor Don Siegelman.
And, of course, as you know, Wolf, this is a back and forth that's gone on for some time. Rove has been subpoenaed before. Through his lawyer, he has refused to testify, citing executive privilege. And the Bush administration Department of Justice didn't enforce that subpoena, but now, without President Bush in power, this back and forth picking up right again.
And I should tell you, Wolf, that we have tried to get ahold of Karl Rove's lawyer through e-mail and phone and we're still waiting to get in touch with him to see if we can get some statement or some response from Mr. Rove.
BLITZER: All right, if you get some reaction, let us know. We will be happy to put that on the air as well.
Brianna is on the Hill for us.
Thank you.
President Obama says he won't let the U.S. be held hostage to dwindling resources or global warming.
(BEGIN VIDEO CLIP)
OBAMA: The days of Washington dragging its heels are over. My administration will not deny facts. We will be guided by them.
(END VIDEO CLIP)
BLITZER: We are going to hear at length from the president of the United States about his new moves on energy.
Plus, week two inside the new White House, it's going to get started tomorrow. Does the president have a lot more work to do to get his economic rescue plan passed?
And are President Obama's dramatic and repeated breaks with the Bush years good politics, good policy, or both? Gloria Borger, David Gergen, Stephen Hayes, they're standing by live.
Stick around. You're in THE SITUATION ROOM.
(COMMERCIAL BREAK)
BLITZER: To our viewers, you're in THE SITUATION ROOM.
Happening now: near the U.S. Embassy in Yemen, fire exchanged between checkpoint police and gunmen in a car, the Associated Press quoting an official as saying the U.S. embassy received a threat of attack hours earlier. We're on top of this story.
A former janitor pleads guilty to trying to sell hardware from Tennessee's closed Oak Ridge nuclear weapons plant. Prosecutors say he was caught in an FBI sting.
And Citigroup is catching heat on news that it is buying a new $45 million corporate jet after accepting billions in bailout funds. Citigroup says it is a replacement aircraft that is much more cost- efficient.
I'm Wolf Blitzer. You're in THE SITUATION ROOM.
ANNOUNCER: This is CNN breaking news.
BLITZER: The Senate has just confirmed Timothy Geithner to become the next secretary of the treasury, the vote, 60 in favor, 34 opposed. Timothy Geithner will now become the secretary of the treasury.
Let's go to our senior White House correspondent, Ed Henry.
They're wasting no time, I take it, Ed. You're getting exclusive information when he's about to be sworn in.
ED HENRY, CNN WHITE HOUSE CORRESPONDENT: That's right, Wolf.
Senior administration officials tell CNN the president himself is going to be heading over very shortly to the Treasury Department, a short walk for him, obviously -- he will probably take a motorcade, nevertheless -- to swear in Tim Geithner.
He will be there with Vice President Biden. The vice president might actually do the technical swearing-in, but the president, we're told, may even make a few comments. This is a sign that the president wants to move extremely quickly to get Tim Geithner actually sworn in. They originally wanted him sworn in, as you know, on Inaugural Day last week. That did not happen because of Tim Geithner's tax problems, the delay in that nomination.
But the White House is elated right now, I can tell you, that he got past all of that controversy. That's why they want to swear him in quickly, so he can hit the ground running. He has a lot on his plate, obviously, the whole bailout situation, the whole economic plan that President Obama is trying to sell tomorrow on Capitol Hill.
He will be meeting with House and Senate Republicans to try to bring them on board amid growing Republican opposition to this $825 billion plan. So, they want Tim Geithner to get to work immediately tonight -- Wolf.
BLITZER: All right. And, as our viewers probably know, he's a former head of the New York Federal Reserve.
We are about to get a new secretary of the treasury.
Ed Henry, thanks very much for that.
And once the president goes over to the Treasury to participate in that swearing-in ceremony, we will have coverage of that right here on CNN.
President Obama today set a new tone for the nation's attitude toward energy and the climate. He made them a priority, linking the country's economic future to the planet's future. And he says America will take the lead in making a change.
(BEGIN VIDEO CLIP)
OBAMA: At a time of such great challenge for America, no single issue is as fundamental to our future as energy.
America's dependence on oil is one of the most serious threats that our nation has faced. It bankrolls dictators, pays for nuclear proliferation, and funds both sides of our struggle against terrorism. It puts the American people at the mercy of shifting gas prices, stifles innovation and sets back our ability to compete.
These urgent dangers to our national and economic security are compounded by the long-term threat of climate change, which, if left unchecked, could result in violent conflicts, terrible storms, shrinking coastlines and irreversible catastrophe.
These are the facts and they are well-known to the American people. After all, there is nothing new about these warnings. Presidents have been sounding the alarm about energy dependence for decades. President Nixon promised to make our energy -- our nation energy independent by the end of the 1970s. When he spoke, we imported about a third of our oil. We now import more than half.
Year after year, decade after decade, we've chosen delay over decisive action. Rigid ideology has overruled sound science. Special interests have overshadowed common sense. Rhetoric has not led to the hard work needed to achieve results. And our leaders raise their voices each time there's a spike in gas prices, only to grow quiet when the price falls at the pump.
Now America has arrived at a crossroads. Embedded in American soil and the wind and the sun, we have the resources to change. Our scientists, businesses and workers have the capacity to move us forward. It falls on us to choose whether to risk the peril that comes with our current course or to seize the promise of energy independence. And for the sake of our security, our economy and our planet, we must have the courage and commitment to change.
It will be the policy of my administration to reverse our dependence on foreign oil while building a new energy economy that will create millions of jobs. We hold no illusion about the task that lies ahead. I cannot promise a quick fix. No single technology or set of regulations will get the job done.
But we will commit ourselves to steady, focused, pragmatic pursuit of an America that is freed from our energy dependence and empowered by a new energy economy that puts millions of our citizens to work.
Today, I'm announcing the first steps on our journey toward energy independence, as we develop new energy, set new fuel-efficiency standards and address greenhouse gas emissions. Each step begins to move us in a new direction, while giving us the tools that we need to change.
First, we must take bold action to create a new American energy economy that creates millions of jobs for our people. The American Recovery and Reinvestment Plan before Congress places a down payment on this economy. It will put 460,000 Americans to work, with clean energy investments and double the capacity to generate alternative energy over the next three years. It will lay down 3,000 miles of transmission lines to deliver this energy to every corner of our country. It will save taxpayers $2 billion a year by making 75 percent of federal buildings more efficient. And it will save working families hundreds of dollars on their energy bills by weatherizing two million homes.
This is the boost that our economy needs and the new beginning that our future demands. By passing the bill, Congress can act where Washington has failed to act over and over again for 30 years. We need more than the same old empty promises. We need to show that this time it will be different. This is the time that Americans must come together on behalf of our common prosperity and security.
Second, we must ensure that the fuel-efficient cars of tomorrow are built right here in the United States of America. Increasing fuel efficiency in our cars and trucks is one of the most important steps that we can take to break our cycle of dependence on foreign oil. It will also help spark the innovation needed to ensure that our auto industry keeps pace with competitors around the world. We will start by implementing new standards for model year 2011, so that we use less oil and families have access to cleaner, more efficient cars and trucks. This rule will be a down payment on a broader and sustained effort to reduce our dependence on foreign oil.
Congress has passed legislation to increase standards to at least 35 miles per gallon by 2020. That 40 percent increase in fuel efficiency for our cars and trucks could save over two million barrels of oil every day -- nearly the entire amount of oil that we import from the Persian Gulf.
Going forward, my administration will work on a bipartisan basis in Washington and with industry partners across the country to forge a comprehensive approach that makes our economy stronger and our nation more secure.
Third, the federal government must work with, not against, states to reduce greenhouse gas emissions. California has shown bold and bipartisan leadership through its effort to forge 21st century standards. And over a dozen states have followed its lead.
But instead of serving as a partner, Washington stood in their way. This refusal to lead risks the creation of a confusing and patchwork set of standards that hurts the environment and the auto industry.
The days of Washington dragging its heels are over. My administration will not deny facts. We will be guided by them. We cannot afford to pass the buck or push the burden onto the states.
ANNOUNCER: This is CNN breaking news.
BLITZER: We're getting reaction to the news that the chairman of the House Judiciary Committee has subpoenaed Karl Rove to testify next week on the firing of those U.S. Attorneys -- Gloria Borger, our senior political analyst, you've been on the phone with Rove's lawyer.
GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: Bob Luskin, his lawyer, who said that President Bush asserted executive privilege in a letter that they have as of two weeks ago. Mr. Lufkin said that we will consult with White House counsel and if there is a disagreement between them and President Bush, they're going to look for a solution.
But President Bush's assertion of executive privilege does not disappear.
So they're going to have discussions. He thinks it's unlikely that the question of whether Mr. Rove is going to testify or not is going to be resolved as early as next week, when they want Karl Rove to testify.
But they do have a letter from the president, as of two weeks ago, asserting executive privilege. But he also...
BLITZER: From the former president.
BORGER: Yes, right, from the former president.
He also makes the case that Karl Rove will do whatever the lawyers decide he should do.
BLITZER: All right. We'll stay on top of this. A little battle ensuing between Karl Rove and John Conyers.
We'll stay on top of it.
Gloria, don't go away, because we have more to talk about.
Coming up, with the plan may have been the easy part. Now President Obama has to sell it to lawmakers. And a lot of Republicans out there are making it clear they're not buying it.
And rolling back President Bush's policies -- is it good politics for President Obama, good policy or is it both?
Gloria is still here. We're going to bring in Steve Hayes and David Gergen. They're standing by live to weigh in.
(COMMERCIAL BREAK)
(BEGIN VIDEO CLIP)
OBAMA: We owe it to each of them and to every single American to act with a sense of urgency and common purpose. We can't afford distractions and we cannot afford delays.
REP. TOM RICE (R), GEORGIA: This isn't stimulus. This is paying back of political friends, this is making it so that they can reward individuals that assisted them in their most recent election.
(END VIDEO CLIP) BLITZER: Congressional Republicans are making it clear they're less than thrilled with President Obama's $825 billion economic stimulus plan.
So how hard of a sell will it be when lawmakers take it up tomorrow?
Let's talk about that and more with our senior political analyst, Gloria Borger; our contributor, Stephen Hayes, of "The Weekly Standard"; and David Gergen, our senior political analyst. They're part of the best political team on television.
How much work does he have -- when he meets separately with House and Senate Republicans tomorrow, how much work does he have before him?
BORGER: I think he has a lot of work to do, particularly with House Republicans. You have the leader of the House Republicans, John Boehner, on the record saying: "Oh, my God," about the stimulus package. It doesn't have enough tax cuts for them -- too much spending.
I think in the Senate, there are more Republicans who might be inclined to vote for it. But again, if Republicans don't want to vote for this, they've got an easy job. They figure it's going to pass without them anyway. So if Republicans don't like it, they can take a pass.
BLITZER: A lot of Republicans will be able to support it in the House and Senate, because there are no tax increases in this $825 billion package.
STEPHEN HAYES, SENIOR WRITER AT "THE WEEKLY STANDARD": Right, which I think is a bonus. It gives them some cover if they ultimately decide to do it.
But I -- I think that you're likely to see a sort of a spine stiffening here in the next couple of days among Republicans. And you've started to see this over the past last couple of days, with them pulling out specific things -- like $142 billion in education funding -- that is, you know, probably not going to be tremendously stimulative.
So I think their question is, is this sort of a Trojan horse for a vast expansion of government that is not even stimulating the economy?
BLITZER: David, given the enormous popularity that Barack Obama has right now, is this smart politically for these Republicans to vote nay?
DAVID GERGEN, CNN SENIOR POLITICAL ANALYST, FORMER PRESIDENTIAL ADVISER: I think it's very smart for them to raise questions about the package. But they have to be very careful not to be seen as pure obstructionists -- doing it only for political gain. I do think they have something to work with here, Wolf. And I think that the president has got a problem on his hands politically. And that is the growing number of examples we've had out of the TARP program helping the banks of things that have gone awry, that have not been well-managed, money that has been misused for refurbishing offices or buying airplanes.
And, you know, we learned today from "Wall Street Journal" that the -- you know, the actual loans by banks that have gotten money from the government has been going down, not up -- even though they got this money for that purpose.
So I think that's giving Republicans a lot of fodder. And Barack Obama has to overcome it.
From my point of view, what Barack Obama needs very soon is to name somebody who's going to oversee the stimulus spending -- someone who's going to make sure that it is spent wisely. He needs a Jack Welch type figure in there, who is tough, who's got corporate experience and who can guarantee the American people this money is not going to be misspent.
BLITZER: But you really can't blame -- in fairness to President Obama, you can't blame him for how the first $350 billion of that so- called TARP money was spent...
BORGER: No.
BLITZER: ...because that was spent during the Bush administration.
BORGER: No. But I -- and I think the second $350 billion of that separate program is going to have to have tremendous oversight. And I -- I agree with David about the oversight on the stimulus package. Because what Republicans are doing is kind of cherry picking pieces of it out that sound a lot more like pork and less like stimulus.
And that's something that Obama is going to have to address. Because he's going to have to go to some of his House Democrats and say, you know, folks, I know you like these programs, but in order to get these Republicans on board -- and I need them, I want this to be a bipartisan package -- we're going to have to give up some of this.
BLITZER: Let's take a look at these. It's not even a week yet that he's been president of the United States, Steve, and he's reversing or modifying major Bush administration positions. Guantanamo Bay, the prison there, he wants it closed within a year. He ordered the U.S. Military to get U.S. Combat forces out of Iraq within 16 months. Today, he announced tougher emission standards for cars. He's lifted the so-called gag rule on abortion counseling for international organizations that receive U.S. Funding. And he's banned the so-called enhanced interro -- interrogation techniques.
Is this smart policy, from his perspective, or is it just politics? HAYES: Well, I think it's expected, really. I mean, the guy won. As he said the other day, he won the election. You expect him to do the things that he campaigned on.
What I find most interesting about this, though, are the exceptions that he's created to himself. On interrogations, he hasn't closed the loop entirely for approving some enhanced interrogation techniques. And on Guantanamo Bay, he's basically sought a delay. And, you know, we don't know what's going to happen with that.
So after campaigning on that for as long as he did -- I mean I would say that that was, in some ways, the centerpiece of his foreign policy or national security critique of the Bush administration -- he hasn't shut the door as sort of swiftly and solidly as I thought he might.
BLITZER: As they say, David, the devil is in the details.
How do you read it?
GERGEN: From my point of view, Wolf, he has been very smart to move swiftly in carrying out his campaign promises. I think Steve is right, it was expected. So by doing it, though, he increases people's trust -- the general public's trust in him as a leader. And he's going to need to get some trust in -- essentially, in the bank -- that he can then transfer over to his economic program and say, because you trusted me on this one, I promise I'm going to do X, Y or Z on the economic program. I will follow through on that.
I think the lack of confidence in the economy is so widespread, that's holding us back. If he can increase some of the trust in himself and transfer it to the economy, maybe he can help get the wheels turning a little faster on the economic front.
BLITZER: Because as we see, just the enormous numbers -- tens of thousands of jobs announced lost on this one day. And it's presumably only going to get worse.
Guys, thanks very much.
We'll stay on top of this story.
Let's check in with Lou to see what's coming up at the top of the hour -- Lou?
LOU DOBBS, CNN ANCHOR: Wolf, thank you.
Tonight, we're reporting on the president's demands for what he calls extraordinary action to tackle a worsening recession.
But are the president and his surrogates talking down the economy to sell their so-called Recovery and Reinvestment Plan?
We'll have that assessment and complete coverage for you tonight.
We'll also be cutting through the increasing partisanship and outright blather on the so-called stimulus package and the direction of our economy. Tonight, we examine charges that this almost $1 trillion stimulus package is full of welfare and pork -- a report you'll only see on "LOU DOBBS TONIGHT."
And we'll be talking with two lawmakers, Congressman Dan Lipinski and Congressman Don Manzullo, who are defying corporate America, lobbyists and special interests leading the fight for "Buy American" to help American jobs, workers and companies.
Join us for all of that, all of the day's news and much more at the top of the hour -- Wolf, back to you.
BLITZER: Lou, thanks very much.
And we're standing by for the swearing-in of Timothy Geithner as the nation's new secretary of the Treasury. The vice president, Joe Biden, will be swearing him in. The president will be at the ceremony. Stay with CNN. We're going to have coverage of that.
President Obama gives marching orders to his new Middle East envoy.
(BEGIN VIDEO CLIP)
OBAMA: The charge that Senator Mitchell has is to engage vigorously and consistently in order for us to achieve genuine progress.
(END VIDEO CLIP)
BLITZER: The task before George Mitchell is nothing less than monumental. But those who know him say if anyone can succeed, it's him.
(COMMERCIAL BREAK)
BLITZER: Two days into his presidency, Barack Obama is now launching his first peace mission around the world, with help from secretary of State Hillary Clinton and their new special envoy to the Middle East, the former Senate majority leader George Mitchell.
Let's go to our foreign affairs correspondent, Jill Dougherty.
She's all over this story.
He launched it -- the president -- today with some fanfare.
JILL DOUGHERTY, CNN FOREIGN AFFAIRS CORRESPONDENT: Right. And, Wolf, George Mitchell will be leaving tonight, in just a few hours, on this eight day trip. And it's one that could test his contention that there is no conflict that can't be ended.
(BEGIN VIDEOTAPE)
OBAMA: I'm pleased to have a chance to confirm... DOUGHERTY (voice-over): A White House strategy session hours before special Mideast envoy George Mitchell leaves on a critical mission.
(BEGIN VIDEO CLIP)
OBAMA: Senator Mitchell is going to be fully empowered by me and fully empowered by Secretary Clinton. So when he speaks, he will be speaking for us.
DOUGHERTY: Just days after his appointment, Mitchell was flying into the whirlwind of Mideast conflict.
GEORGE MITCHELL, SPECIAL ENVOY FOR MIDDLE EAST PEACE: The pursuit of peace is so important that it demands our maximum effort, no matter the difficulties, no matter the setbacks.
DOUGHERTY: That's the ultimate aim. But with the Gaza conflict still at a rolling boil, Mitchell's immediate task is to push for a lasting cease-fire, open border crossings, jump-start aid to Gaza, work with Egypt to stop smuggling, preventing Hamas from rearming.
After visiting Cairo, Mitchell heads to Israel and the Palestinian West Bank. Then key allies, Jordan and Saudi Arabia, where patience with the U.S. is wearing thin.
Former Saudi ambassador to the U.S. Turkey al-Faisal, warning without forceful U.S. engagement, the peace process, the U.S.-Saudi relationship and the stability of the region are at risk.
It's a tall order. But Mitchell, a former Mideast envoy who also negotiated peace in Northern Ireland, has been here before, which makes him, says one former Mideast negotiator, the right guy for the job.
AARON DAVID MILLER, AUTHOR, "THE MUCH TOO PROMISED LAND": Mitchell is not a yeller and a screamer. He's persistent. He's determined. He's patient. And I think Mitchell's success will be a combination two of things -- his willingness and capacity to understand fairly and honestly what each side needs in order to cut a deal, on one hand; and his firmness in insisting if, in effect, he is to do his job, the Arabs and the Israelis really have to help him.
DOUGHERTY: But a new CNN poll shows the domestic political challenges to being even-handed when it comes to the Middle East -- six in 10 Americans saying they sympathize more with the Israelis than with the Palestinians.
(END VIDEOTAPE)
DOUGHERTY: But there are no allusions that this trip by Mitchell can quickly bring about Middle Eastern peace. The State Department says that he is listening mode and it's really just the first step in what could be a very long and difficult process -- Wolf.
BLITZER: If he can do it, he'll deserve much more than a Peace Prize.
All right. Thanks, Jill, very much.
Let's wish Senator Mitchell only the best.
Let's check in with Jack Cafferty.
He's got "The Cafferty File" -- Jack.
CAFFERTY: The question this hour, is the spirit of bipartisan already dead in Washington -- if, in fact it ever existed to begin with?
John writes: "Bipartisanship is not dead yet. The Republicans will approve the stimulus package and Eric Holder for attorney general. The Republicans will jump on the Obama administration, though, if there are no improvements in the economy by January of 2010."
Jackie in Texas: "Bipartisanship, what's that? Between the Democrats shooting themselves in their collective feet by fighting our new president and Republicans trying to sound all moral and fiscally conservative -- even though we all know they were the ones that got us into this mess, I don't believe that it exists -- yet."
Stacy in Virginia: "If you listen to right wing radio, which I do for kicks, they are attacking President Obama, the Democrats, Republicans who work toward compromise and so-called blind and lazy Americans that voted to throw the GOP out of office. For these people, bipartisanship and compromise are signs of weakness and failure. They are prophets, to some degree, because Obama's success means their tyrannical dogma is on the way out."
Claire in Florida writes: "Hello, Jack. Sadly, bipartisanship is just a meaningless word to the Republicans. These are the same follow the leader ideologues who aided, abetted and enabled Bush-Cheney to put through all these illegal priorities they instituted. I seem to remember something about partisan hacks not allowing the Democrats in the Congressional discussions about Bush-Cheney bills when they were in the majority. What goes around, comes around. And I hope they enjoy the irrelevancy they have worked so hard to achieve."
Matt in Virginia writes: "Bipartisanship not dead yet. What we're seeing is the end of Obama's honeymoon. The celebration is over and now the uphill battle begins. No matter what, there's going to be friction between liberals and conservatives. But unlike Bush, at least Obama is extending his hand, not clenching his fist."
And Kaz writes: "If you got rid of Pelosi and Reid, there would be more bipartisanship. They try and ram everything down the Republicans' throats. Naturally, they push back harder than they normally would if their Republican ideas were heard."
If you didn't see your e-mail here, you can go to my blog at CNN.com/caffertyfile and look for yours there, among hundreds of others -- Wolf. BLITZER: Thank you, Jack.
See you back here tomorrow.
Remember, we're waiting to hear from President Obama and Vice President Joe Biden. They're getting ready to swear in the new secretary of the Treasury, Timothy Geithner, who has just been confirmed by the full Senate.
Meanwhile, the Illinois governor, Rod Blagojevich, is really opening up -- his big day with the news media. Jeanne Moss has a "Moost Unusual" look. That's coming up, as well.
(COMMERCIAL BREAK)
BLITZER: For weeks, people have been talking about the Illinois governor, Rod Blagojevich. Today, Blagojevich was talking and talking and talking.
CNN's Jeanne Moos takes a "Moost Unusual" look.
(BEGIN VIDEOTAPE)
JEANNE MOOS, CNN CORRESPONDENT (voice-over): Blah, blah, blah, Blagojevich.
BLAGOJEVICH: The answer is this...
UNIDENTIFIED MALE: We don't want you over here.
BLAGOJEVICH: ...because you...
UNIDENTIFIED FEMALE: The camera is over here.
BLAGOJEVICH: Oh.
So who am I talking to?
(CROSSTALK)
UNIDENTIFIED FEMALE: Right here.
MOOS: You're talking to everybody.
(BEGIN VIDEO CLIP, COURTESY FOX NEWS)
GERALDO RIVERA, FOX NEWS CORRESPONDENT: Governor, open the window.
(END VIDEO CLIP)
MOOS: He didn't just open the window for Geraldo, he came out the door. He let Joy Behar on "The View" mess up his hair...
(BEGIN VIDEO CLIP)
JOY BEHAR, CO-HOST "THE VIEW": Come on.
(END VIDEO CLIP)
MOOS: ...then fix it up for him. He rescued a camera person who almost got pushed off her perch trying to get a better angle.
UNIDENTIFIED FEMALE: Hey, hey, hey, hey.
BLAGOJEVICH: Well, come on. You ought to be careful. Look how high she's up there.
Are you all right?
I'm holding you.
MOOS (on camera): No matter what reporters wanted to ask, there are things the governor wanted to say over and over about the impeachment proceedings against him.
BLAGOJEVICH: The fix is in.
I think the fix is in.
I know the fix is in.
MOOS: But the fix wasn't in for Senator Oprah Winfrey. Governor Blagojevich confessed he considered Oprah to fill Barack Obama's Senate seat.
(BEGIN VIDEO CLIP)
UNIDENTIFIED FEMALE: I've heard Oprah.
BLAGOJEVICH: That is true.
(END VIDEO CLIP)
MOOS: Oprah hadn't heard it and expressed bemused shock.
OPRAH WINFREY: I think I could be senator, too. I'm just not interested.
MOOS: What were interesting were all the cuckoo questions.
(BEGIN VIDEO CLIP)
MAYOR RICHARD M. DALEY, CHICAGO: I said cuckoo once, I'll say it again. Cuckoo. Thank you.
(BEGIN VIDEO CLIP, COURTESY FOX NEWS)
UNIDENTIFIED FEMALE: I have to ask what it's like to hear Mayor Daley call you cuckoo.
(END VIDEO CLIP)
(BEGIN VIDEO CLIP)
BEHAR: You and your wife are potty mounts (ph).
(END VIDEO CLIP)
(BEGIN VIDEO CLIP, COURTESY FOX NEWS)
BLAGOJEVICH: Those tapes sound so tacky.
(END VIDEO CLIP)
(BEGIN VIDEO CLIP)
BARBARA WALTERS, CO-HOST "THE VIEW": Your wife's family is -- doesn't seem to be crazy about you.
(LAUGHTER)
WALTERS: For your own dignity, wouldn't it be better if you resigned?
BLAGOJEVICH: No, that would be the worst thing that I could do.
(END VIDEO CLIP)
MOOS: Now those were great questions, but they don't compare to the grilling the governor got as he left a Manhattan restaurant.
UNIDENTIFIED MALE: How was dinner?
(CROSSTALK)
UNIDENTIFIED MALE: How was dinner?
Good?
BLAGOJEVICH: It was good. Thank you.
UNIDENTIFIED MALE: What did you have?
BLAGOJEVICH: Yes.
UNIDENTIFIED MALE: What did you have for dinner?
MOOS: For the record, it was pork loin with spinach and mashed potatoes. And we're told the governor had his table mates in stitches doing an impression.
(BEGIN VIDEO CLIP FROM "THE VIEW," COURTESY ABC)
BEHAR: Wait a minute. He does a fabulous Nixon impression. Do it for us.
(LAUGHTER)
BLAGOJEVICH: Who said that? BEHAR: Somebody told me. Come on.
BLAGOJEVICH: Well, no, I...
BEHAR: Just say I am not a crook. Do it.
BLAGOJEVICH: No, I'm not going to say that.
(LAUGHTER)
(END VIDEO CLIP)
MOOS: Governor Blagojevich declined. He did say...
(BEGIN VIDEO CLIP)
BLAGOJEVICH: Well, let me make this perfectly clear.
(LAUGHTER)
BLAGOJEVICH: I didn't do anything wrong.
(END VIDEO CLIP)
MOOS: To paraphrase Nixon --
(BEGIN VIDEO CLIP, COURTESY RICHARD NIXON LIBRARY)
RICHARD M. NIXON, FORMER PRESIDENT OF THE UNITED STATES: I'm not a crook.
(END VIDEO CLIP)
MOOS: Blagojevich is not a bleeping crook.
Jeanne Moos, CNN, New York.
(END VIDEOTAPE)
BLITZER: And finally, this note. We inadvertently showed the wrong video while referring to the president's aunt, a Kenya native who lives in the Boston area and has been in the United States for at least four years. The video was of another aunt who still lives in Kenya. We apologize for the error.
Let's go right to Lou.
He's got "LOU DOBBS TONIGHT" -- Lou.
