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No More Enemy Combatants; What To Do with GITMO Detainees; Lenders Accused of Racism; Nickel-And-Diming the Unemployed; Forced to Sell Sacred Heirlooms; Target of Your Anger: Governors

Aired March 13, 2009 - 17:00   ET

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

WOLF BLITZER, CNN ANCHOR: Happening now, the Obama administration may have a plan to ship out some terror suspects so it can shut down the prison camp at Guantanamo Bay -- getting a head start by getting rid of some very loaded language.

American teenagers hit men for a Mexican drug cartel and proud of it -- authorities say there are more of them in sleeper cells across the United States.

And a rabbi's widow left in debt by the swindler, Bernard Madoff. Now she's forced to sell off sacred religious heirlooms.

I'm Wolf Blitzer.

You're in THE SITUATION ROOM.

The President wants to shut down the detention camp at Guantanamo Bay and move out the terror suspects. His administration may be getting a head start by dropping the loaded term "enemy combatant" -- the term used during the Bush administration.

Let's go to our senior White House correspondent, Ed Henry.

He's here in THE SITUATION ROOM -- all right, Ed, explain what this really means.

ED HENRY, CNN CONGRESSIONAL CORRESPONDENT: A lot of substance here, but also symbolism. The White House is still, we have to be clear, declaring that the military has the power to hold the suspects, but that the power comes from Congress and the international laws of war, not from the power of the presidency.

That's a sharp break, of course, from the Bush-Cheney administration. They asserted the president could hold these prisoners indefinitely without any charges.

So in substance, the Obama team says there are now limits to holding these suspects. But symbolically, the term "enemy combatant," as you noted, became loaded language. It almost became a four letter word around the world, just like the war on terror. And you'll notice, the president doesn't really use that phrase "war on terror" anymore, either.

So beyond this legal documents, what's significant is the Obama administration is saying, basically, look, there's a new sheriff in town. We have a whole new approach to dealing with these terror suspects.

BLITZER: So is it fair to say that there are some new standards in place now in terms of who gets released and who doesn't?

HENRY: It absolutely does. And the question of who will be released is still unclear. The White House is setting a higher bar, though, for keeping those 240 terror suspects at Guantanamo Bay in custody. They're saying that suspects will be detained only if they provided "substantial support" to the Taliban or Al Qaeda.

Liberals are saying, look, this sets a good standard. If you were a minor player with one of these terror groups, you shouldn't be in a legal black hole indefinitely.

Conservatives are going to raise questions and say, well, how do you define substantial support?

This could lead to some of these dangerous suspects getting out onto the streets.

A couple nights ago, I was in the West Wing of the White House late at night and I saw the White House counsel, Greg Craig, as well as Eric Holder, the attorney general. They were huddled in the corner. And I was wondering what they were talking about just a couple of nights ago.

They're the two people in charge of this 180-day review to figure out how they're going to actually set these standards. They have their work cut out for them, because the legal questions moving forward -- it's not just keeping them for the next few months, these terror suspects, but they want to close Guantanamo Bay -- that military prison down within a year.

Facing that and actually doing the details, there's going to be some tough, long nights for them working through that.

BLITZER: Do you know for sure whether or not when they were huddled in the corner this was the subject they were talking about?

HENRY: Well, the legal document comes out within 48 hours. So it's a reasonable assumption that that was one of the issues they were talking about. They were waiting to get in right outside the Oval Office. So I think it's interesting now all this comes out after they've been meeting intensively over -- in recent days.

BLITZER: Ed Henry, thanks very much.

You learn a lot in the West Wing of the White House just hanging out.

HENRY: (INAUDIBLE) you never know.

BLITZER: I used to do it myself.

HENRY: I know that.

BLITZER: All right. Thank you.

Before the U.S. can shut down the detention center at Guantanamo Bay, it must decide what to do with the terror suspects who are still there, especially dozens from Yemen. The U.S. is reluctant to simply ship them home, but a plan may be in the works.

Let's bring in our Pentagon correspondent, Chris Lawrence -- Chris, tell us what's going on.

CHRIS LAWRENCE, CNN PENTAGON CORRESPONDENT: Well, Wolf, the plan would involve sending Yemeni prisoners to Saudi Arabia for rehabilitation. A diplomatic source who is familiar with the talks says the U.S. has approached both the Saudis and Yemen about the idea.

Now, these two countries share a border. But the Saudis have said their first priority is getting their own citizens out of the prison. And recently in a speech, the president of Yemen said he would be against the idea.

Now the U.S. is under pressure to figure out what to do with the remaining 240 prisoners at Guantanamo. U.S. officials tell CNN that almost half of those remaining prisoners are Yemenis and they're not confident the Yemen government can properly deal with them. You know, Yemen has been a safe haven for Al Qaeda for years -- from the USS Cole in 2000 to an attack on the U.S. embassy last year.

BLITZER: Chris, this rehabilitation program in Saudi Arabia, what's that all about?

LAWRENCE: Well, I think you're showing some of the photos that CNN obtained from -- from inside a class. The program uses education, reconnection with family and job training to try to reintegrate these prisoners into society. The Saudi government also gives them and their families money, provides them with jobs and, in some cases, even provides them with wives.

BLITZER: But the question is, does the program really work?

If they are, in fact, hardened terrorists, can this rehabilitation program in Saudi Arabia make them productive, peaceful citizens?

LAWRENCE: Well, it's considered effective, but it has had its problems. Some of the Guantanamo prisoners, in fact, have ended up back in terrorists roles, like this man, I think, that you're seeing right now. He's a Saudi. He's now considered Al Qaeda and Yemen's leader and may have been responsible for a car bombing outside the U.S. embassy just last year.

Now, a spokesman for the Yemen embassy told CNN that the country is trying to create its own rehabilitation program modeled on this Saudi program. But money is an issue and they're also waiting to see what President Obama is going to do.

BLITZER: All right. Chris, thanks very much.

Chris Lawrence at the Pentagon.

Let's go to Jack Cafferty.

He has The Cafferty File -- Jack.

CAFFERTY: Wolf, as the recession drags on, there is a distinct possibility that the sagging economy could spell trouble for incumbent politicians.

What's that old saying, around every cloud, if you look hard enough, there's a silver lining?

For example, in New Jersey, a Quinnipiac University poll of registered voters shows the Democrat governor, John Corzine, who's up for reelection in November, is trailing his likely Republican challenger, Chris Christie, by 9 points in a hypothetical match-up, up from a 6 point margin last month.

Corzine is trailing despite the fact 61 percent of those surveyed say they don't even know enough about Christie to cast a vote. Half of all voters disapprove of the job Corzine is doing and 53 percent say he doesn't deserve to be re-elected.

In this climate, it probably doesn't help that Corzine is a veteran of Wall Street.

Corzine is not the only one, either. The "Dallas Morning News" writes: "The recession could play a key role in next year's reelection campaign of Texas Governor Rick Perry, a Republican, Perry has been bullish on the economy, taking credit whenever things go well.

Well, with job losses expected to peak in Texas right around the time of the primaries, Perry could have a lot of explaining to do. One expert says: "Bad economies are bad for incumbents. He can't claim he wasn't in office when the economy went bad, he's been there for a decade."

So here's the question -- will the recession make you less likely to vote for incumbents?

Go to CNN.com/caffertyfile and post a comment on my blog.

You should be less likely to vote for them anyway. One-term is enough. Throw them out and get somebody else get in.

(LAUGHTER)

CAFFERTY: If you leave them there too long, they learn how to steal and rob us blind.

BLITZER: Strong words Jack.

Thank you.

Jack Cafferty will be back shortly. A new lawsuit accuses some major mortgage firms of systematic racism. CNN's Tom Foreman -- he's over at the magic wall looking at the charges that African-Americans have been hit harder than most by some subprime lending practices.

And forced to sell these religious heirlooms -- the widow of a rabbi who was a victim of the Nazis now victimized herself by the swindler, Bernard Madoff.

And Michelle Obama gives her first TV interview as first lady and tries to give a boost to her husband's image.

Stay with us.

You're in THE SITUATION ROOM.

(COMMERCIAL BREAK)

BLITZER: A new lawsuit is accusing two of the nation's largest mortgage companies of systematic, institutionalized racism. The suit filed by the NAACP targets the firms Wells Fargo and HSBC. Civil rights groups cite several studies that show African-Americans have been harder hit than most people by the subprime lending crisis.

BENJAMIN JEALOUS, PRESIDENT AND CEO, NAACP: This sort of discrimination, at the end of the day, totals up to the biggest strip mining of working people in this country that we've seen in the 233 years, you know, since the U.S. has been here. It's a very big deal.

(END VIDEO CLIP)

BLITZER: A Wells Fargo spokeswoman says: "The NAACP's allegations are totally unfounded and reckless. We have never tolerated and will never tolerate discrimination in any way, shape or form in any of our business practices, products or services."

The firm HSBC also stands by its lending practices.

Let's walk over to Tom Foreman.

He's got a closer look into these allegations.

And you can do it dramatically with the help of our magic wall.

TOM FOREMAN, CNN CORRESPONDENT: You can, Wolf. At least you can see why people might think that there is a problem.

Let's look at the map of the United States right now. And I'm going to light up right here all the subprime lending in this country based on a percentage of what we're talking about.

You can see the blue areas up here where you have less subprime lending. Over here, the more orange it is, the more subprime lending. And you can see there are sort of hot spots.

Here's New York up here. Here's Michigan. Here's Illinois. Here's out in California, this area down here.

And then here's the biggest swatting down here of states that have some relationship with subprime lending. A lot of folks down in this area.

And now, here's what I want to do. I want to take this back so all you see are these shapes that we've highlighted here. And now I'm going to highlight by county where most of the African-Americans in this country live.

And look at this. Now you see that biggest area in the bottom that we were talking about, where there's so much subprime lending, does encompass a large part of the African-American population of this country.

So you see why some people might look at this and say there's a relationship. And, in fact, we did the math here. We took one set of numbers -- and, believe me, there are a lot of competing numbers on this. And we looked at this area up here, which is really predominantly white in a big way. We took like six states up here and six states down here and we just did the math.

What percentage, as you combine them, on average, were getting these types of loans?

Up here, the subprime rate was -- about 20 percent of the loans were subprime.

Down in this area, when we looked at this, we got, Wolf, 28 percent.

So that's what's attracting these people who are trying to push this case toward these companies -- Wolf.

BLITZER: Any other reasons, potentially, besides racism that could result in this?

FOREMAN: Yes, absolutely, Wolf. And that's the tricky part of this.

What else could be involved here other than racism?

Well, there are a lot of possibilities. And we're going to zoom in real quickly to look at Illinois and see what Illinois would tell us about all of this.

Look at the State of Illinois. If we look here, you can see that there are clusters of large African-American populations up here around Chicago, down around St. Louis and some others around the state a little bit.

But when you get down to the detail level, when you get beyond the generalization and you say now let's look at subprime lending in this state, now look. You get a very different look when you go down to the lower part and you look at the subprimes. Gosh, it's all over the map. Some states are being -- some counties are being hit very hard here that seem to have relatively small African-American populations. Some that have very large are not being hit so far.

That's what they're going to have to look at very carefully in court to see is it race or is it income or is it urban dwelling or was it particular companies operating in that area, trying to reach out to certain neighborhoods?

A lot of possible factors. That's what will have to be sorted out -- Wolf.

BLITZER: Tom Foreman, thank you.

Thanks very much.

Talk about adding insult to injury, laid off workers across the country say they're now being nickeled and dimed to death by fees on their unemployment benefits.

Drew Griffin of CNN's Special Investigations Unit is doing what he does best. He's investigating, together with your team.

What are you finding -- Drew?

DREW GRIFFIN, CNN SPECIAL INVESTIGATIONS UNIT CORRESPONDENT: Well, this really is insulting to the unemployed. Imagine just getting laid off and then be told by the state that you live in that the fastest way to get your benefits is with this debit card. But be careful -- use it too much, in fact, use it more than just once a pay period, in some cases, and you could be slapped with bank fees.

(BEGIN VIDEOTAPE)

STEVE LIPPE, UNEMPLOYED SALESMAN: To it's $1.50 here, $1.50, $1.50, purchases in the U.S. no fee; cash back with a purchasing fee, $.40 for a balance inquiry.

GRIFFIN (voice-over): These are the fees attached to Steve Lippe's unemployment benefits -- actually, to a debit card he got from the state. When he filed for unemployment, Pennsylvania gave him the option -- wait 10 days for your check or get this card immediately.

LIPPE: I was livid that -- that this situation existed. I just -- I just couldn't believe it. It's, you know, an outrage is too weak a word. It's obscene.

GRIFFIN: Thirty states run similar programs, contracting with a dozen big banks to distribute unemployment benefits on debit cards and allowing banks to the unemployed. We went to JPMorgan Chase, Bank of America, Wells Fargo and Wachovia, who all referred us to state governments, including Pennsylvania, where Steve Lippe is being charged.

Pennsylvania's acting secretary of labor is Sandi Vito. Her staff invited us to Allentown, where Vito was participating in this public meeting. Afterwards, we were promised she would answer our questions about debit fees. But when the meeting was over, Vito was running from our camera -- suddenly, too busy, her staff said, to talk to us.

(on camera): Hi, Ms. Vito?

SANDI VITO, ACTING SECRETARY OF LABOR: Hi.

GRIFFIN: Drew Griffin with CNN.

Do you have just a second?

VITO: I don't. I'm sorry. I've got to run.

GRIFFIN: You can't -- we just have one question.

VITO: Yes, I'm sorry. I can't.

GRIFFIN (voice-over): And as she dashed out the door, her press secretary tried to explain why unemployed workers in Pennsylvania were being charged fees to get their unemployment benefits.

TROY A. THOMPSON, PENNSYLVANIA DEPARTMENT OF LABOR & INDUSTRY: The distribution system for -- for getting individuals their benefits has been improved by the use of debit cards, way above and beyond what the -- what the distribution of a paper check had done.

(END VIDEO TAPE)

GRIFFIN: Wolf, that answer is not good enough for some members of Congress, New York's Carolyn Maloney among them. She says especially with 27 billion more dollars going out to unemployment benefits in that stimulus package, she wonders how much of that is going right into the banks in the way of fees.

The U.S. Department of Labor would only say it's aware of this problem and would be working with the states, they say, to try to resolve these problems related to fees -- Wolf.

BLITZER: Thanks very much, Drew.

Good report, by the way.

You can see a lot more of Drew's investigative reports later tonight on "LOU DOBBS TONIGHT" at 700 p.m. Eastern.

Fire breaks out in a high rise mall with more than 2,000 shops. Thousands of shoppers are forced to flee, as helicopters pluck others from the roofs. We're going to show you the dramatic video.

And during the campaign, President Obama pledged to work hard to extend gay rights. But now a California court is forcing his hand.

But is it too soon to confront the issue?

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

(COMMERCIAL BREAK)

BLITZER: Zain Verjee is off today.

Fredricka Whitfield is monitoring some other important stories right now incoming into THE SITUATION ROOM right now.

What's going on -- Fred?

WHITFIELD: Hello again, Wolf.

A TV executive accused of beheading his wife just days after she filed for a divorce says he didn't murder her. The Buffalo, New York man pleaded not guilty today. Investigators say back in February, the man led police to his wife's body inside the offices of the Muslim TV network that they ran together. Police say the woman had filed for divorce six days earlier and had a restraining order against her husband.

And smoke and flames pour out of the windows of a high rise mall. This fire in Bangladesh today forced thousands of shoppers to rush out of the complex. Police say at least four people are dead and at least 20 injured. The mall is enormous, with 2,000 stores. Investigators say they are not sure how many people may have been trapped inside.

And the death of former Playboy playmate, Anna Nicole Smith, now has the attention of California's attorney general. He is charging smith's long-time partner, Howard K. Stern and Smith's former doctors. The A.G. Office says that the men gave Smith so many prescription pills that she was drugged: "Almost to the point of stupification." The attorney general says the men used fake names to get pills. Smith died of an overdose back in 2007. Stern and one doctor were released on bond yesterday.

And, Wolf, see that dummy right there on the wall?

Well, police say a driver in Washington State put that dummy in the passenger seat of his car so that he could use the car pool lane to beat traffic. The problem is he forgot to actually fasten the seat belt to the dummy and the trooper who happened to notice the vehicle noticed the dangling buckle, pulled over the driver and then ticketed him for violating HOV rules. Now he is even later than I guess he would have had he just stayed in traffic like everybody else -- Wolf.

BLITZER: Good point.

(LAUGHTER)

BLITZER: All right. That guy could be a little bit too smart.

All right, thanks very much for that, Fred.

A rabbi's widow left in debt by the swindler, Bernard Madoff. And now she's forced to sell off some sacred religious heirlooms. Let's go to CNN's Mary Snow.

She's got this story for us -- Mary, this is a sad one.

But tell our viewers what's going on.

MARY SNOW, CNN CORRESPONDENT: Yes, Wolf, it's really a heartbreaking story. One of these items is more than 200 years old. But members of the rabbi's family say they had no choice but to sell it.

(BEGIN VIDEOTAPE)

ELISA SCHINDLER, DAUGHTER OF RABBI SCHINDLER: It's really just one of our favorite pictures. It really captures the true essence of who Alexander Schindler was, with a smile on his face and the twinkle in his eye.

SNOW (voice-over): Elisa Schindler says she's focusing on the legacy of her late father, the rabbi Alexander Schindler, and not on anger toward Bernard Madoff. But says she's relieved her father didn't live to see the destruction Madoff has caused.

SCHINDLER: Here's a man who dedicated his entire life to making the world a better place. And then you contrast that with a man who didn't do that.

SNOW: Schindler, who died in 2000, was a leader of Reform Judaism in the U.S. who fought for civil rights and reached out to world leaders, seen here photographed at the White House and with the pope.

When he retired, his daughter says he invested his life savings with Madoff, but never met him. Now, Schindler's widow, Rhea, has to sell the home where they raised their five children, along with two sacred pieces of Judaica given to the rabbi as a retirement gift.

JONATHAN GREENSTEIN, JEWISH ANTIQUES EXPERT: It's extremely rare. Extremely, extremely rare.

SNOW: Auctioneer Jonathan Greenstein, who specializes in antique Judaica, says this Torah pointer dates back to the late 1700s and survived the Holocaust.

Also being sold, this Torah crown.

GREENSTEIN: It shouldn't be ruined by Bernie Madoff or anybody -- or any negative history that could be connected to it, but should be admired because it belonged to Rabbi Schindler.

SNOW: Elisa Schindler also says she doesn't want the items to be tainted by the Madoff scandal. And while she says it's heartbreaking, she also reminds herself of other struggles her family has endured.

SCHINDLER: My father came out of Nazi Germany. His mother once told me, when she came out of Germany, that what's in your mind and what's in your heart, they can never take away from you. And that was a lesson that's always stuck with me. Nobody can take that from you. And the rest of it is just things.

(END VIDEO TAPE)

SNOW: Now the items are to be auctioned in June. The auctioneer says he is hoping that someone will buy the items and return them to the Schindler family -- Wolf.

BLITZER: And do we have any idea how much they're worth, Mary?

SNOW: Well, the auctioneer says he thinks they are worth or he can get as much as $30,000, a little bit more than that. That would be at the high end of this. And, you know, the family said they come from modest means. They really didn't have any items to sell. And they really felt that they were forced to do this.

BLITZER: What a sad story. I knew Rabbi Schindler rather well. He was really a great, great man in many, many areas. My heart goes out to his entire family.

Thanks very much for that, Mary Snow.

American teenagers as young as 13 recruited as assassins for a Mexican drug cartel. CNN has obtained the shocking interrogation videos where they detail the killings and tell authorities they: "loved it." We're going to show you those tapes.

And a day after Michelle Obama takes her first official solo trip as first lady, there's another first step for the first lady. We'll tell you what's going on right here in THE SITUATION ROOM.

(COMMERCIAL BREAK)

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

Happening now, recruited to kill -- American teenagers hired as hit men for a Mexican drug cartel -- how it happened and the danger authorities say is still out there.

We know where billions of dollars of your money is going and why it could lead to faster travel for you.

I'm Wolf Blitzer.

You're in THE SITUATION ROOM.

We're going to focus in now on a story about a Democrat who's in trouble in one of the bluest states in the country.

Our senior political analyst, Bill Schneider, is looking into this story and what it tells us about larger trends out there -- what are the political signals, Bill, that we're getting right now from New Jersey?

WILLIAM SCHNEIDER, CNN SENIOR POLITICAL ANALYST: Well, that governor Corzine is in trouble. And if the governor of New Jersey is in trouble, other governors may be in trouble, too. (BEGIN VIDEOTAPE)

GOV. JON CORZINE, NEW JERSEY: I may not always have done what's popular at the moment, but you can be damned sure I've always done what I thought was right.

SCHNEIDER: Bold words from a governor who's in big trouble. Governor Jon Corzine is running 9 points behind his most likely Republican opponent, former U.S. Attorney Chris Christie, in two different polls of New Jersey voters. New Jersey is this year's marquis race -- a big state with an incumbent running for re-election. Next year, 36 states will elect governors. In the midterm election, voters take out their frustrations on governors. They're in charge. The Jersey boys are frustrated. The New Jersey economy is lousy, just like in other states.

On Tuesday, the governor announced some tough budget proposals, just like in other states.

GOV. JON CORZINE (D), NEW JERSEY: The wage freeze and furloughs for employees, eliminating the property tax deduction for next year on state income taxes for everyone but seniors.

SCHNEIDER: Corzine's a Wall Street multimillionaire. That meant financial whiz when he got elected in 2005. Now Wall Street has a tarnished image which he's eager to shake.

CORZINE: The tax structure in this country is making it easy for my old friends on Wall Street to do really, really well while the middle class is under enormous pressure.

SCHNEIDER: In 2007, Governor Corzine was critically injured when the state car he was riding in crashed and he was not wearing a seat belt.

CORZINE: I have to live with my mistake. You don't. Buckle up.

(END VIDEOTAPE)

SCHNEIDER: The governor could pass on that advice to a lot of other incoming governors running for re-election next year. Buckle up. It's going to be a bumpy ride. Wolf?

WOLF BLITZER, CNN ANCHOR: It certainly will. Bill Schneider, thanks very much.

Let's discuss what is going on in New Jersey and elsewhere, how much concern there should be for other democratic politicians right now, democratic incumbents, whether governors, members of the house or senate. Joining us are the strategists Paul Begala and republican strategist Ed Rollins. Both part of the best political team on television.

You remember, Paul, very well what happened in '94, the first midterm election after Bill Clinton make president of the United States. It was a blood bath for democrats in the house and senate. If the economy is still bad next year, how worried should all these democrat incumbents be?

PAUL BEGALA, DEMOCRATIC STRATEGIST: I think they should be worried. In 1992, of course, I helped elect Bill Clinton. I rode my horse up to New Jersey and almost in political unknown, beat him. Christy Todd Whitman, and he whipped my butt in that 1993 race in New Jersey. Ed I still take my hat off to you for that.

ED ROLLINS, REPUBLICAN STRATEGIST: Best campaign ever run. You guys did a great job.

BEGALA: Seriously, you're the best in the business but there was also larger forces going on. People were getting angry at the democrats; change had not come fast enough. I do think the caution for democrats now is this. They have in brand Obama; perhaps the only loved institution in America today is our president along with the military. But people are mad at their banks and their businesses. They are mad as a general matter at congress, although congress is picking up a little. My advice to those democrats would be, don't try to separate yourself from this president. He's the best thing you've got going. You should rise and fall with him and I think they will rise with him. He could be the life raft in this.

BLITZER: So assuming the economy is still bad next year, Ed, what is the cautionary note for republicans?

ROLLINS: Well, I think republicans have got to run aggressive campaigns against each individual congressional race, particularly midterms after presidential are about can you get your own vote out. Obviously Obama put together a fabulous campaign. If that mechanism is still in place, it's going to help. But at the same time, each individual congressman and congressional challenger runs their own race. I think the key thing here is there are probably 50 seats that were won in the last two election cycles, republicans have held in the past. They won in 2004. If we don't make some end roads, if we don't get 15 or 20 of those seats back, we're going to live with this for a long period of time and this is the year to do it. Usually there's a drop off in the democrat vote in the off year. If that doesn't happen this time, then certainly democrats can have this thing for a long period of time.

BLITZER: As if the president, Paul, doesn't have enough on his plate right now. I assume you saw that front page story in the "New York Times" today, that he has to confront a really sensitive issue involving gay rights, he's got to make a decision fairly soon whether health insurance benefits to same-sex partners of federal employees have to go forward. You know, if you were giving some advice to the president on this issue right now, what would you say?

BEGALA: I would say, most decisions coming to the president are hard decisions, sir. This is an easy one. It's simple justice. When I worked for the federal government and I earned health benefits, benefits also applied to my life partner, my wife Diane. When these gay employees of the federal appeals court of San Francisco applied for equal treatment under the law, they are not getting it. The 14th amendment is very clear. He's the president of -- this is not a difficult one for Barack Obama. You have to treat all Americans equally. Gay Americans are equal Americans and ought to be treated as such. This should be an easy call for him and have absolutely equal rights.

BLITZER: It's not so easy Ed because the opponents of this are citing a 1996 defense of marriage act which says marriage is only between a man and a woman an act that President Clinton signed into law.

ROLLINS: It's an extraordinarily polarizing issue and I'm not going to argue one side or the other. All I'm going to say is that the president basically made this law the land without a court having ruled one way or the other on the defense of marriage act or on the California situation. I think he's going to ask or get a lot of polarization. It's a tough decision. Every decision a president makes is a tough decision.

BLITZER: What would you advise him? I know he's not going to -- what would you tell him?

ROLLINS: My advice is sooner or later the Supreme Court is going to take this issue up and I would wait until that occurred. And if that occurs and they basically say that these marriages are valid or that same-sex -- same partnership is a valid issue, I think you give the same rights, as Paul said.

BEGALA: Although, this is not marriage. There's an important factual difference. No one is asking the president to recognize anyone's marriage, simply the right to have equal benefits under the law. Health benefits I think is an equal case to make. My goodness, people have the rights to the same health benefits that straight people have. With marriage, I asked him about it, I said, of course I'm for gay marriage. Marriage is a little harder but the health benefits should be easy.

BLITZER: What about discrimination against gays and the military by just giving an order that you don't remove military personnel who are gay simply because they are gay.

BEGALA: My guess is that's coming. I don't know that. I don't have any insider knowledge that suggests that. But this is even Dick Cheney, not exactly a liberal, has said for years that the ban on -- the former defense secretary, Mr. Cheney, that the ban on a gay and lesbian serving equally in the military should be repealed and, my goodness, is Dick Cheney is for repealing it --

BLITZER: We heard late last year from Colin Powell who was the chairman of the joint chiefs when the don't ask don't tell went into effect back in 1993, we heard him say that times have changed since then and maybe it's time to reconsider.

ROLLINS: Times have changed and obviously brave men and women who obviously are homosexual or lesbians or what have you have fought for this country and they deserve to not be discriminated against and I think to a certain extent the president committed to do this. He can do it better than anybody else. A republican couldn't do it but certainly the president can do it. BLITZER: We'll leave it there. Ed Rollins, Paul Begala, guys, have a great weekend.

ROLLINS: Thank you very much. Take care.

BLITZER: Assassins are waiting for the phone to ring, perhaps in a town near you.

For a Mexican drug cartel, we have their stunning confession.

Plus, the first lady, Michelle Obama, gives a TV interview and tries to give a boost to her husband's image.

(COMMERCIAL BREAK)

BLITZER: A hit man for a Mexican drug cartel and, guess what, they say they are proud of it and authorities say there are more of them in sleeper cells across the united states. CNN's Ed Lavendera has the stunning confession.

(BEGIN VIDEOTAPE)

ED LAVENDERA, CNN CORRESPONDENT: Garcia just finished a family lunch in Laredo, Texas. He helped his pregnant wife and 3-year-old boy into their white Lexus.

LORI GARCIA, SON KILLED: This guy just came out of the car and just started shooting.

LAVENDERA: Garcia was a wanted man. He had a $10,000 bounty on his head. His wife was shot in the chest. She and her son survived but he was dead.

GARCIA: It happened so fast. He didn't have a chance with anything.

LAVENDERA: Garcia's murder at first looked like an isolated gang-land style killing but there were more. Seven murders in a year- long stretch. There was something more sinister brewing. Then Flores was killed, an innocent victim in case of mistaken identity. Investigators found fingerprints on the cigarette box in the shooter's get away car. The chilling truth unraveled and the clue led the police to American teenagers working as Mexican drug cartel hit men in the United States.

ROBERT GARCIA, LAREDO, TEXAS POLICE: They were very good at what they did. They were professional at what they did.

LAVENDERA: Assassins is what they were. How Gabriel evolved from an average teenager into hit men is laid out in court records and these police interrogation records obtained by CNN. In this tape, the details about how he carries out the first cartel assassination at the age of 13. I loved doing it, killing that first person. I loved it. I thought I was Superman. Detective Robert Garcia is the man sitting across the table from him.

GARCIA: One thing you wonder all the time, what made them be this way?

LAVENDERA: Like many Americans, these teenagers started hitting the bars across the border in Mexico and that's where the cartel was waiting to recruit them. These kids were easy targets for the cartel. They started living the high life. They got tattoos honoring the grim reaper like saint honored by drug traffickers. He had eye balances tattooed on his eyelids and markings marked his face.

They should have been in school here but instead the investigators say that he dropped out and joined the cartel's payroll. They drove around town in a $70,000 Mercedes and were paid $500 a week as a retainer to sit and wait for the call to kill. Then they could make up to $50,000 for a hit. Prosecutors say that they were hit men for a group of former special military forces that do the dirty work for the gulf cartel.

URIEL DRUKER, WEBB CO., TEXAS ASST. DISTRICT ATTNY.: They actually enjoy it and laugh about it and compete while discussing their exploits about conducting these activities.

GARCIA: They are already here. They are sleeper cells. They are already here in the U.S.

LAVENDERA: The interrogation he tells detectives that they are moving their operations deeper into the U.S. he says that he knows of his carried out in Houston and Dallas. They are in prison now serving long terms for murder. Before they were arrested, federal authorities recorded a phone call between the two young men. He brags about killing 14-year-old, the innocent cousin of an enemy, who is also murdered. He laughs about torturing both, making stew out of their bodies in large metal drums. He and his cousin have never been found. Before the call ends, he says -- there are three left to kill. There are three left. It's a reminder that cartels work never ends as they recruit the next generations of killers.

Ed Lavendera, CNN, Laredo.

(END VIDEOTAPE)

BLITZER: Going after young girls that dare to attend school like this one, it's a savage crime of the Taliban's renewed assault on Afghanistan. Many are now standing up to the threat. CNN's international security correspondent Paula Newton has our story from Kabul.

Paula?

PAULA NEWTON, CNN INTERNATIONAL SECURITY CORRESPONDENT: Another school year has opened in Afghanistan and still the Taliban is threatening girls who dare go to school.

(BEGIN VIDEOTAPE)

NEWTON: Threatening the Taliban scene against them. How many of them were afraid coming to school today? All afraid in and your parents? While the risk might be modest here in Kabul, more than 600 Afghan schools cannot open this year because of security threats. Safia Hayat is principal of the girl's school. I am asking those who close schools and throw acid on girls to let the children of this country go to school. Because it's a crime to close the schools, crime against the children of this country. When Taliban ruled Afghanistan in the late 1990s, girls were not allowed to go to the school. The Taliban commander told us schools dishonor women.

UNIDENTIFIED FEMALE: A doctor? And you?

NEWTON: In earnest, these aspiring young women say that they are afraid.

UNIDENTIFIED FEMALE: We don't have security.

NEWTON: But still determined to defy the Taliban. In the words Principal Hayat, for more than three decades, these children will build the future of Afghanistan. The students can't study, our future will be dark.

(END VIDEOTAPE)

NEWTON: And Wolf, CNN has been able to confirm that just to the west of here, two male students were beheaded by the Taliban just for speaking English. Wolf?

BLITZER: Thanks very much for that, Paula.

You might call it the money train. More than a billion stimulus dollars are going to Amtrak. Will it mean cheaper fares for you?

Today Michelle Obama is speaking about something else close to her heart. Her husband. We'll tell you what she has to say right here in THE SITUATION ROOM.

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BLITZER: Right back to Jack for the "Cafferty File."

Jack?

JACK CAFFERTY, CNN CORRESPONDENT: Wolf, the question this hour is, will the recession make you less likely to vote for incumbents at the next election?

Jim writes, "Yes, it will make me vote for the ouster of all those republican do-nothings that got us into the mess then did nothing about it and tried to sabotage everything this congress and president tried to do to rectify their wrongs. The grand old pussyfooters had their chance and they blew it royally."

Susan in Tuscaloosa, Alabama, "No, I never voted for them anyway. I would sooner vote for Mickey Mouse than my incumbents Dick Shelby or Jeff Sessions. Need I say more?"

Sam in Atlanta, "I don't need a recession to change my mind. It's just time for all career politicians to retire or find new lines of work and stop claiming that they're serving the people who put them in office. There's a lengthy list of those wasting space in D.C. and sucking up the taxpayers' money."

Damon in North Carolina, "Didn't we just do that? I say give him a couple of years and I'll give you a solid answer."

Agnes in Arizona writes, "The recession will double my efforts to unseat John McCain and Senator John Kyl from Arizona. We love our Congressmen Harry Mitchell plus the other members of the Arizona Congressional Delegation."

Scott writes, "If I could vote against Pelosi or Reid, I would be more than happy to. Other than that, I prefer the democrats are in control."

And Susan writes from Idaho, "Here they don't get voted out. They have to be caught playing happy feet in men's rooms and then they resign. Keep in mind here in Idaho, folks keep voting the same way and then pray for different results."

If you didn't see your e-mail here, you can go to my blog CNN.com/Cafferty file and look for yours there among hundreds of others. Nice way to spend the weekend, just perusing the "Cafferty File."

BLITZER: A lot of people do that, Jack.

CAFFERTY: They don't.

BLITZER: Pretty soon they'll be spending the weekends perusing your new book.

CAFFERTY: That's a good idea. It comes out a week from Monday.

BLITZER: I think it's already in some bookstores. What's the name of it again?

CAFFERTY: "Now or Never."

BLITZER: I've read it.

CAFFERTY: And you liked it, you said?

BLITZER: I liked it. I'm on the record.

CAFFERTY: What a guy.

BLITZER: Good work.

Monday we're also digging deeper into the economic crisis and how it's affecting you. What are you dying to ask our experts about the economy? You can submit your video questions to ireport.com/situationroom. We're going to have the answers for you next week.

Michelle Obama sits down for a rare TV interview. We're going to show you what she's saying about the president's first 50 days in office and her new role.

Also, how her daughters are adopting to life in the white house. That's coming up next right here in THE SITUATION ROOM.

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BLITZER: Traveling to North Carolina to meet with military families over at Fort Bragg, the first lady, Michelle Obama, is now speaking out on behalf of her husband's agenda. Let's go back to Fredricka Whitfield. She's got the story for us.

Fred, what happened today?

FREDRICKA WHITFIELD, CNN CORRESPONDENT: Wolf, it was her first television interview as first lady today. And she used it to try to give her husband's image a little boost.

(BEGIN VIDEOTAPE)

WHITFIELD: With her husband's first 100 days agenda on the line in Washington, Michelle Obama puts in a good word for him on ABCs "Good Morning America."

MICHELLE OBAMA, FIRST LADY: I believe in this nation, and I believe in my husband. Those are two things. I wouldn't want anybody but Barack Obama to be working at this time. Because he is a focused, clear-thinking, rational man. And that's what we need right now.

WHITFIELD: To those who say her husband might be doing too much too fast, she says --

OBAMA: There are also people saying he's not doing enough. We'll have to try a lot of things. Some of them will work, some of them won't. I think right now people understand that we're going to all have to work together and make a set of sacrifices.

WHITFIELD: How far will she go in advocating her husband's agenda?

LIZ CHADDERDON, DEMOCRATIC STRATEGIST: I'm sort of waiting for the real Michelle to appear, the one who likes to take on the tough issues, the one who will stand up and say things that make people raise their eyebrows. I like that Michelle.

WHITFIELD: If Michelle Obama goes too far into policy that won't help her husband.

Balancing her official duties with time for her two daughters.

OBAMA: I think I have a pretty full plate, but I still have time to be home for homework, and to make sure I'm there before they leave and to go to their parent/teacher conferences and everything that is important to do as a parent. So they're doing great. They keep us going.

(END VIDEOTAPE) WHITFIELD: The white house makeover for the Obama family is well under way. That shows it right there. The swing set was installed just last week on the white house south lawn, just 30 feet from the oval office window. So the girls can keep an eye on dad and dad can keep an eye on the girls. Wolf?

BLITZER: Excellent idea, Fred. Thanks very much. Stand by. Let's not forget tomorrow, Saturday, right here, THE SITUATION ROOM, our weekend edition, 6:00 p.m. eastern, among other things, we're going to be speaking with the education secretary, Arne Duncan, also a victim of the Bernard Madoff rip-off. 6:00 p.m. Eastern Saturday.

Wall Street's best week of the year. The Obama administration is urging investors to take advantage of bargains, now.

In the grip of recession, one industry's loss is another's gain. We're touting the winners and losers.

He's on the wanted list and on the Forbes list of billionaires as well. This hour, is an alleged drug king pin being glorified?