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The Situation Room
President Obama's Unprecedented Request For Power; Supreme Court and Gay Rights
Aired March 24, 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: Happening now: The Obama administration want powers never before seen, the treasury secretary and the Federal Reserve chairman arguing it is absolutely necessary in these economic times. Republicans say it is an outright power grab.
A Web site yells scandal at a top university. It's over President Obama. One group even calls so far -- goes so far as to call him -- and I'm quoting now -- "abortion president."
And new pictures of Kim Jong Il, along with pictures of a confident U.S. Navy admiral. He says the U.S. is ready to defend against North Korean missile targeting of the United States -- all that plus the best political team on television.
We want to welcome our viewers in the United States and around the world. I'm Wolf Blitzer. You are in THE SITUATION ROOM.
The Obama administration says a financial crisis like no other requires special powers never given to the government before, so it is asking Congress, essentially, to turn the existing model of financial regulation on its head. The treasury secretary, Timothy Geithner, and the Federal Reserve chairman, Ben Bernanke, put the request to Congress today. Republicans, though, are blasting it.
(BEGIN VIDEO CLIP)
REP. JOHN BOEHNER (R-OH), HOUSE MINORITY LEADER: This is an unprecedented grab of power. And before that occurs there ought to be a real debate about whether we should give that authority to the treasury secretary.
(END VIDEO CLIP)
BLITZER: Let's go right to Capitol Hill.
Our senior congressional correspondent, Dana Bash, has all the details for us -- Dana.
DANA BASH, CNN SENIOR CONGRESSIONAL CORRESPONDENT: Well, Wolf, every time the Fed chief and the treasury secretary have come under withering criticism here on the Hill about the way that they handled these bailouts, the response has been, look, we did what we could with the tools that we have.
So, today, they came armed with a new controversial proposal was for new tools. (BEGIN VIDEOTAPE)
BASH (voice-over): The treasury secretary is trying to channel AIG anger into a new solution. Give him unprecedented power.
TIMOTHY GEITHNER, U.S. TREASURY SECRETARY: We came into this crisis without the authority and the tools necessary to contain the damage to the American economy.
BASH: Timothy Geithner wants Congress to grant him the same power over non-banking financial institutions like AIG that the FDIC has over banks, the ability to take control of a failing company and do what it takes to reduce risks.
Fed Chairman Ben Bernanke backed the idea, saying he would have had better tools to handle AIG's crisis and its controversial bonuses.
BEN BERNANKE, FEDERAL RESERVE CHAIRMAN: This bonus issue wouldn't have arisen because all the contracts could have been adjusted.
BASH: In fact, Bernanke said when he learned of AIG's bonuses, he wanted to sue, but was stopped by Fed lawyers.
Bernanke and Geithner's new proposal was clearly intended to deflect outrage, but it didn't always work, like when this Democrat demanded a full list of companies taking taxpayer dollars that paid bonuses.
REP. BRAD SHERMAN (D), CALIFORNIA: Are you going to give us the chart or are you going to hide the ball?
GEITHNER: I'm not going to hide the ball.
SHERMAN: Are you going to give us the chart?
GEITHNER: I will reflect on the suggestion you made and see if that is a reasonable...
(CROSSTALK)
SHERMAN: In other words, you won't commit to telling the American people how many folks at Goldman Sachs or AIG are going to make $1 million this year?
GEITHNER: Congressman, I will think carefully about your proposal.
BASH: That exchange evidence that Geithner's shaky bailout history will make lawmakers think twice before expanding his power.
(END VIDEOTAPE)
BLITZER: Before any of that power, Dana, is expanded, Congress has to pass legislation giving the executive branch this kind of new authority. Will Congress do that?
BASH: Well, you know, Democratic leaders in both the House and the Senate, they came out in support of this idea today.
But rank and file lawmakers, they are a bit more cautious, and the reason is because they feel like they have been burned by jumping in behind proposals with regard to these complex issues coming out of Treasury before. But we're going to have a chance to look at more dissection of this in the next couple of days because there's another hearing on this the day after tomorrow -- Wolf.
BLITZER: Under two hours from now -- Dana, thanks very much -- the presidential news conference, we are counting down at the bottom of the screen. You are going to see what happens right here on CNN.
Our coverage, by the way, will begin at 7:45 p.m. Eastern.
Now, President Obama will do what virtually no other president does this early in his new term. The prime-time news conference, the administration hopes, will become tonight must-see TV, all part of the administration' all-out press to get its message out to you.
Let's go straight to our White House correspondence, Dan Lothian.
Set the stage for us, Dan.
DAN LOTHIAN, CNN WHITE HOUSE CORRESPONDENT: Well, Wolf, what the president is expected to tell the American people tonight is that when it comes to the economic crisis, this administration has been attacking it on all fronts, trying to create jobs, help responsible homeowners and try to get money for lending flowing again.
This administration, the way they see it, is that there are signs of progress.
(BEGIN VIDEOTAPE)
LOTHIAN (voice-over): The president on offense ready to face the public in prime time.
ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: He wants to talk directly to them about what he is seeing and what he is working on every day, what is being put in place to strengthen our economy.
LOTHIAN: In just two days, the Obama administration has ramped up its domestic and international agenda, toughening its Mexico border policy with a $700 million commitment and deployment of hundreds of border agents, rolling out a plan to rid banks of toxic assets, announcing three of four key senior positions at Treasury, including Timothy Geithner's deputy, and asking Congress for new regulatory powers to prevent another meltdown like what happened at AIG.
OBAMA: I hope it doesn't take too long to convince Congress. And in the absence of that capacity, you end up with the situation that we've been in -- a systemic or an institution that poses systemic risks to the system, but a lack of capacity to shut it down.
LOTHIAN: The economy is a global concern, so the president sent a message to 31 newspapers around the world, writing in an op-ed that "The United States is ready to lead. And we call upon our partners to join us with a sense of urgency and common purpose."
OBAMA: I would love to visit Australia.
LOTHIAN: One of those partners, the prime minister of Australia, visited the White House. Tackling the global economic crisis dominated their meeting.
OBAMA: Our own success in rebounding from this crisis is going to be tied up with what happens around the world.
(END VIDEOTAPE)
LOTHIAN: We did receive some excerpts from the president's opening remarks tonight, the president expected to say in part -- quote -- "We will recover from this recession, but it will take time. It will take patience and it will take an understanding that, when we all work together, when each of us looks beyond our own short-term interests to the wider set of obligations we have to each other, that's when we succeed."
So, Wolf, an upbeat message from the president expected tonight, but still that reality that all of this will take time.
BLITZER: Yes, that challenge to the American people is easier said than done, obviously.
All right, thanks very much, Dan.
As we said, what happens tonight, certainly not uncommon for presidents, but it is rare for a president to hold a prime-time news conference this early in a brand-new term. President Nixon was the first to have a solo prime-time news conference.
That was back in March of 1969. President Reagan had the most prime-time solo news conferences, 31. As for more recent administrations, President Clinton held four prime-time Q&A sessions with reporters. President George W. Bush also held four.
Let's go to Jack Cafferty for "The Cafferty File" -- Jack.
JACK CAFFERTY, CNN ANCHOR: Wolf, first it was Russia. Now China is banging this drum. The Chinese Central Bank says it wants to dump the dollar as the international reserve currency and replace it with a new global system controlled by the International Monetary Fund.
China says the goal is to create a reserve currency that is disconnected from individual nations and is able to remain stable in the long run. Translation, that Beijing is worried actions being taken to save America's slumping economy will wind up hurting them.
It's also another sign the Chinese are becomingly increasingly concerned about holding more than $1 trillion of our debt. However, China did issue a separate announcement today that said they will continue to buy U.S. treasuries.
China wants a basket of currencies based on the value of the dollar, the yen, the euro, the pound sterling. After Russia initially proposed the idea of replacing the dollar, it said China, along with other emerging nations, were also on board. Also, a U.N. panel of experts -- now, I'm not sure -- that's an oxymoron -- is looking at increasing the use of a new international currency as well.
Most analysts don't think the dollar will be replaced anytime soon, but it may be a sign that China is flexing its economic muscle. And the timing is interesting here. It is happening just a week before the G-20 summit of the world's largest economies in London.
So, the question is this. What's the dollar really worth now? Go to CNN.com/caffertyfile and you can post a comment on my blog -- Wolf.
BLITZER: Still a very good piece of currency. I like it.
CAFFERTY: I would prefer it to anything else out that is there.
BLITZER: Me, too.
CAFFERTY: Right.
BLITZER: Jack, thank you.
Is Barack Obama like Ronald Reagan? As the nation's problems mount, his approval ratings stay high -- why he is being called a Teflon president.
And an openly gay congressman explains why this may not be the best time to take the issue of same-sex marriage to the U.S. Supreme Court. And he has some stunning criticism of one of the justices.
And investigators may have an important new clue into that fiery plane crash that killed 14 people in Montana.
(COMMERCIAL BREAK)
BLITZER: All right. There's already some controversy clouding President Obama's plan to address graduates at one of America's best- known Catholic universities.
Let's go to CNN's Brian Todd. He's working the story for us.
What's the controversy, Brian, all about?
BRIAN TODD, CNN CORRESPONDENT: Well, Wolf, some real brushback in the Catholic Church to the president's upcoming commencement address at Notre Dame university. He is scheduled to give that speech on May 17.
But the church leader whose diocese includes the university, Bishop John D'Arcy of Fort Wayne in South Bend, is boycotting the speech because of the president's support for abortion rights and embryonic stem cell research.
Also, the Cardinal Newman Society, which favors a more strict Catholic doctrine on college campuses, is asking people to sign an online petition calling President Obama's speech -- quote -- "an outrage and a scandal."
But Notre Dame doesn't seem to be backing down. A school spokesman told us, he doesn't think the president will -- the invitation, rather, will be rescinded. And he also says -- he gives us this quote from the school's president, John Jenkins -- quote -- "The invitation to President Obama to be our commencement speaker shouldn't be taken as condoning or endorsing his positions on specific issues regarding the protection of human life, including abortion and embryonic stem cell research."
Now, when we contacted the White House, a spokeswoman there said the president is honored to speak at Notre Dame to have the support of many Catholics, but -- quote -- "He does not govern with the expectation that everyone sees eye to eye with him on every position. And the spirit of debate and healthy disagreement on important issues is part of what he loves about this country."
Wolf, that speech is about two months away, the groundswell already beginning. We will see if the protests grow from here.
BLITZER: We will see. We will watch it with you, Brian. Thank you.
Despite the nation's growing list of problems, President Obama's popularity remains very high.
Let's go to our national political correspondent, Jessica Yellin, with more on this story -- Jessica.
JESSICA YELLIN, CNN CONGRESSIONAL CORRESPONDENT: Wolf, you look at the latest polling, and it's clear that Americans are angry. They're angry at AIG, at Congress, at Treasury Secretary Geithner, but guess who they don't blame? President Obama. He's untouched, wildly popular, with an approval rating of 63 percent.
So, is he the next Teflon president?
(BEGIN VIDEOTAPE)
YELLIN (voice-over): Rage over bonuses, a treasury secretary under fire, and a growing budget battle. With debris flying in Washington, none of it seems to be hitting the president. Mr. Obama's approval ratings remains sky-high.
OBAMA: Because I was those standing outside soaking in some rays.
(LAUGHTER) YELLIN: Comic book artists paint President Obama as an impenetrable superhero. But political watchers say a better comparison is to Ronald Reagan, a Teflon president.
STUART ROTHENBERG, EDITOR AND PUBLISHER, "THE ROTHENBERG POLITICAL REPORT": Even if they disagreed with him on individual issues, they still generally support him because they liked him. Barack Obama is benefiting I think from personal affection the way Ronald Reagan did.
YELLIN: His explanation? Americans want the president to succeed. Though he takes hits for issues like AIG, Americans don't blame him for the overall state of the economy. And his style helps him stay above the fray, brushing off criticism as he did literally during the campaign.
OBAMA: You just got to kind of let it...
(CHEERING AND APPLAUSE)
YELLIN: Top White House aides agree their greatest weapon is the president's personal appeal and they are deploying it aggressively, making him a permanent campaigner. He is everywhere, selling the economic plan this week.
OBAMA: The taxpayers share in the upside, as well as the downside.
YELLIN: Last week, he saturated the airwaves to clean up the AIG mess and reminded critics of his enormous popularity outside the beltway. But political watchers caution, the president's Teflon does not guarantee Congress will do everything he wants.
ROTHENBERG: It is not clear that just because he's popular that three months from now or six months from now, he will get whatever he wants on health care or whatever he wants on energy or tax policy.
(END VIDEOTAPE)
YELLIN: Wolf, he doesn't even have to wait that long to see if Congress will go his way. Late today, Senate Democrats announced plans to slice and dice the president's budget, which is his top priority.
Senator Kent Conrad, who runs the Budget Committee, said in a statement -- quote -- "We have made hundreds of billions of dollars of changes to make this work to get down to the deficit goal, and at the same time maintain the president's priorities of education and energy and health care."
In other words, Wolf, the president is going to have to fight Congress to get his way, despite his overwhelming popularity.
BLITZER: And there are some other Democrats who are insisting that his priorities are simply too expensive.
All right, thanks very much, Jessica, for that.
We are counting down to President Obama's prime-time news conference, one hour and forty-three minutes to go. But he may have addressed one of this evening's hot topics already today when he called regulation of the financial industry absolutely critical -- the president coming up in his on words.
And new pictures of Kim Jong Il, along with pictures of a very confident U.S. admiral. He says the U.S. is ready to defend against any North Korean missile targeting the United States.
And NASA wants the public to help name a new part of the space station, but did Comedy Central's Stephen Colbert manage to rig the online poll?
(BEGIN VIDEO CLIP, "THE COLBERT REPORT")
STEPHEN COLBERT, HOST, "THE COLBERT REPORT": You know what name would look fantastic on the side of that module? Colbert!
(CHEERING AND APPLAUSE)
(END VIDEO CLIP)
(COMMERCIAL BREAK)
BLITZER: President Obama made a very long-distance phone call today. He called to chat with the combined crews of the space shuttle Discovery and the International Space Station. They spoke about everything from how fast they were traveling to upgrades they are making on the orbiting lab.
(BEGIN VIDEO CLIP)
OBAMA: we are really excited about the project that you're doing. My understanding is, is that you are installing some additional solar panels on the space station, and that's actually going to increase the number of people that can work out of the space station, is that correct?
JOHN PHILLIPS, NASA ASTRONAUT: Sir, that's correct. We've roughly doubled the amount of solar power available for experimentation and for supporting a larger crew, and we hope to go to a crew of six and a more aggressive experimental program this year.
(END VIDEO CLIP)
BLITZER: Discovery, by the way, scheduled to return to Earth on Saturday.
NASA has asked the American public to help name a new section of the space station, but did Stephen Colbert hijack the online poll?
(BEGIN VIDEO CLIP, "THE COLBERT REPORT")
COLBERT: You are officially mobilized to get that module named after me.
(END VIDEO CLIP)
BLITZER: All right, let's go to our Internet reporter, Abbi Tatton. She's following this story.
Abbi, did Stephen Colbert succeed?
ABBI TATTON, CNN INTERNET REPORTER: Wolf, so far he's won the popular vote, that's for sure.
NASA had wanted a name for this new section of the International Space Station to reflect a spirit of exploration and cooperation. Well, the people have spoken and they have chosen Colbert -- 230,000 submissions were registered for the name Colbert on an online poll that NASA has been running, by far the biggest submission of the whole group, even more than NASA's own suggestions.
Now, if this stands, if the vote stands, this is what the International Space Station's various sections or rooms would look like. Unity is one, Harmony, Destiny, and Colbert. However, this is not over. NASA says they reserve the right to make the final decision on what this module should be named when they decide next month.
And Colbert's fans have been disappointed in the past. You might remember a couple of years ago, they weighed in on an online poll to name -- to rename a bridge in Hungary after Stephen Colbert. The Hungarian government concluded, as Colbert was neither dead nor a Hungarian speaker, that he was not eligible -- Wolf.
BLITZER: Thanks very much, Abbi, for that.
Colbert, Unity, Harmony, Destiny, all right.
Vermont's State Senate has approved a bill allowing same-sex couples to marry, and it now goes to the statehouse. But under the 1996 Defense of Marriage Act, other states can refuse to recognize legal gay unions, bypassing the Constitution's full faith and credit clause.
Gay rights activists hope to see the Supreme Court rule on the law, but one U.S. congressman says not now, because one of the justices he says is homophobic.
CNN's Brianna Keilar is joining us now with more on this story.
Explain the background. What is going on?
BRIANNA KEILAR, CNN CONGRESSIONAL CORRESPONDENT: Well, this is Congressman Barney Frank, Wolf. He is an influential proponent of gay rights. But when it comes to same-sex marriage, he is actually urging patience.
(BEGIN VIDEOTAPE)
KEILAR (voice-over): In an interview with a gay news Web site, openly gay Congressman Barney Frank says now is not the time to take the issue of same-sex marriage to the nation's highest court.
REP. BARNEY FRANK (D-MA), FINANCIAL SERVICES COMMITTEE CHAIRMAN: It is a good one. At some point, that's going to have to go to the United States Supreme Court. I wouldn't want it to go to the United States Supreme Court now because that homophobe Antonin Scalia has got too many votes on this current court.
KEILAR: In a phone conversation, Frank told me he regards Scalia as a homophobe because of the way the conservative justice phrases his opposition to landmark gay rights cases.
For instance, in the mid-'90s, Coloradans voted to prohibit state government from protecting gay men and lesbians from discrimination. The Supreme Court said it was unconstitutional. Scalia sharply disagreed, writing: "Of course, it is our moral heritage that one should not hate any human being or class of humans, but I had thought that one could consider certain conduct reprehensible, murder, for example, or polygamy, or cruelty to animals, and could exhibit even animus towards such conduct. Surely , that is the only sort of animus at issue here, moral disapproval of homosexual conduct."
Says Frank, "The fact that someone believes the Defense of Marriage Act is unconstitutional does not mean they're a homophobe. There's a legitimate constitutional question there. What I'm talking about is the angry anti-gay rhetoric."
(END VIDEOTAPE)
KEILAR: Wolf, a spokeswoman for the Supreme Court said Justice Scalia would not have a response to Frank's comments. And, Wolf, we should note, it is somewhat standard that justices don't respond to these kind of things.
BLITZER: Thank you very much, Brianna Keilar.
We're getting ready for the presidential news conference. We're counting down to the news conference. We will assess what's likely to happen with the best political team on television when we come back.
(COMMERCIAL BREAK)
BLITZER: Let's get back to our top story, the Obama administration seeking unprecedented authority to regulate financial institutions the way that the federal government can now regulate regular banks. The president says he needs to be able to act on systemic risks.
(BEGIN VIDEO CLIP)
OBAMA: Right now we do not have resolution authority for a non- bank institution like AIG that is comparable to what we have for banks that get into trouble using the FDIC.
And in the absence of that capacity, you end up with the situation that we've been in -- a systemic or an institution that poses systemic risks to the system, but a lack of capacity to shut it down in an orderly way, renegotiate contracts, sell-off bad assets, and do so in a way that doesn't endanger the entire system.
So we are already hard at work in putting forward a detailed proposal. We will work in consultation with members of Congress. That will be just one phase of a broader regulatory framework that we're going to have to put in place to prevent these kinds of crises from happening again.
(END VIDEO CLIP)
BLITZER: President Obama also says it is absolutely critical that the economy return to a sustainable approach to growth, rather than rely on bubbles.
(BEGIN VIDEO CLIP)
OBAMA: Subprime lending was the initial trigger. But there's a larger problem, and that is huge unregulated capital flows, a reliance on bubbles as a driver of economic growth.
And what we have said is that it is very important for us to return to a much more stable approach to economic growth, one that's built on improved education, making sure that we are developing the new clean energies of the future, having a regulatory system in place that protects consumers.
In the case of housing, for example, here in the United States you saw people being peddled loans that they could never hope to pay back. But also protects the system by insuring that you're not leveraging off of one shaky loan huge numbers of other financial products that ultimately prove to be worthless. So this whole issue of financial regulation is going to be absolutely critical.
(END VIDEO CLIP)
BLITZER: President Obama also spoke about the ongoing terror threat, the topic he discussed at the White House with the visiting Australian prime minister. President Obama says the U.S. needs to stay focused right now.
(BEGIN VIDEO CLIP)
OBAMA: What I shared with the Prime Minister Rudd, you know, is something that I think the Australian people understand, just as the American people understand -- that the threat of terrorist attacks from Al Qaeda and their affiliates is not a threat that's gone away. We have to take it seriously.
Obviously, the United States has in its memory -- what's been burned into our memory is the events of 9/11. But I think the Australian people remember what happened in Bali. That's not something that we will forget.
And, as a consequence, it's important for us to stay on the offensive and to dismantle these terrorist organizations wherever they are. It is a difficult task. It's one that requires us to stay focused. It requires effective coordinated action. (END VIDEO CLIP)
BLITZER: President Obama in the Oval Office earlier today.
It's a potential crisis for the Obama administration -- North Korea possibly only a few days away from a missile launch -- why the White House has few good options right now.
Plus, we asked what you would ask the president in tonight's prime time news conference at the White House. Now our political roundtable is getting ready to weigh in.
Stay with us.
You're in THE SITUATION ROOM.
(COMMERCIAL BREAK)
BLITZER: We're 90 minutes away. We're counting down to President Obama's prime time news conference tonight.
Let's assess what's likely to happen with our senior political analyst, Gloria Borger; our CNN chief national correspondent, John King, the hose of "STATE OF THE UNION," which airs Sunday mornings; CNN political contributor Steve Hayes with "The Weekly Standard;" and Clarence Page of the "Chicago Tribune."
Here's an iReport. We asked our viewers out there to send in some video iReports of what they'd like to ask the president of the United States. This one from James Foley, who sent this in, this iReport, from Idaho.
(BEGIN VIDEO CLIP)
JAMES FOLEY, CNN IREPORTER: And my question would be to the president at his press conference today, is he prepared for the possibility that some or many of his policies may fail?
(END VIDEO CLIP)
BLITZER: They need some better lighting over there in Idaho.
(LAUGHTER)
BLITZER: He considers himself a moderate. He did vote for President Obama. It's a fair question, though.
How should the president respond to a question like that?
GLORIA BORGER, SENIOR POLITICAL ANALYST: Well, I think the president doesn't want to say that he thinks his policies can fail. What he has said in the past and continues to say is this is so complex, that sometimes we're going to be wrong. And if we're wrong, we're not going to be afraid to say you know what, we went in the wrong direction here and we need to correct that. But what the president is really going to do tonight is try and instill confidence in the American people that he's got a plan that's going to work.
BLITZER: One of the things that these news conferences -- these White House news conferences -- and you and I, John, we were both once White House correspondents. The president usually never gets follow-up questions.
JOHN KING, CNN CHIEF NATIONAL CORRESPONDENT: That's right.
BLITZER: The reporters, they all come with their questions and then the president can weave and dodge and get around it. But then they move on and ask another question.
I think it's really important for our White House report -- reportorial colleagues to follow up and press if the president doesn't answer a question.
KING: If you think you're going to get called on first, second or third, you come in prepared with a question. But what I always enjoyed doing if I was not in the first few people called on is listening, to do just that point -- listening. And maybe your four questions later, but you think you didn't quite answer Wolf's question, Mr. President, and jump back in. I think that's one of the responsibilities of the press corps. And I think this is an important moment because people are going to say a popular president with his second prime time news conference in just a few weeks, why is he doing this?
Well, he's doing this because, yes, he is popular. But to Gloria's point and to the perceptive iReport question, he has some selling to do.
Already, Wolf, you're seeing Democrats -- the chairman of the Senate Budget Committee today said, I like all the presidents priorities, but his math doesn't add up and I'm going to take away one of the tax cuts he wants. I'm going to find spending cuts elsewhere because I think this president, a Democrat, is running too big of a deficit.
Remember in 1993, Democrats supported Bill Clinton. In 1994, they were punished by the American people in the election. And Democrats in Congress know they need to be careful, as much as they support this president.
BLITZER: They have a memory.
All right, Steve, I had this exchange earlier today with Austan Goolsbee, one of the president's top economic advisers, amidst these suggestions by some in China that they may want to back away from the U.S. dollar as the U.S. international currency of choice toward some sort of new international currency.
Listen to this.
(BEGIN VIDEOTAPE)
AUSTAN GOOLSBEE, WHITE HOUSE ECONOMIC ADVISER: Different people have, in the past, argued for world currencies or new -- new currencies before. I believe the U.S. at this point, is the safest place to invest in the world. And it's likely to remain that the dollar is a critical currency in the years ahead.
BLITZER: So you don't like the new international currency that some Chinese are proposing?
GOOLSBEE: Well, look...
BLITZER: I assume that's right, right?
GOOLSBEE: I haven't seen the details of what they're proposing. I mean the dollar is the dollar. If people don't want to buy it, they don't buy it.
(END VIDEO CLIP)
BLITZER: Well, the Chinese have so much -- nearly a trillion dollars in U.S. currency -- loans that they've given the United States -- Steve, you've got to take all this talk seriously.
STEPHEN HAYES, SENIOR WRITER "THE WEEKLY STANDARD": Yes. I -- I was watching you from the gym, Wolf, and I nearly fell off the elliptical when I -- when I saw his non-response there. I mean I thought you pressed him twice to rule this out, to say, no, look, this is the U.S. dollar. We are confident in the U.S. dollar. We would not even entertain another global currency at this point. And I thought he went out of his way not to rule that out.
I would say going into this, you know, major press conference -- I think John laid it out quite well -- that's not exactly the kind of message you want to be sending as a key member of President Obama's economic team.
BLITZER: He had a few stumbles in the "60 Minutes" interview and the Jay Leno interview the other day, Clarence. He's got to be careful when he's joking around, which is often sort of an instinct that these political leaders have when speaking with reporters.
CLARENCE PAGE, "CHICAGO TRIBUNE": Well, that's true, Wolf, if you want to impress other reporters and pundits like us. I think your own Gallup Poll shows it has very little impact on most Americans. His approval ratings are still high. And it gives us something to talk about right now, because these economic stories are really complicated.
He's got to do some -- some heavy selling. It's tough for us to talk about these concepts without viewers' eyes glazing over. And it's easier for us to look at his facial expressions and his various ticks or whatever. And this is going all over the Internet like crazy right now. I mean you would never guess that Barack Obama had any confidence at all, judging by the -- by the various Internet traffic over him giggling during the "60 Minutes" interview, as if this were a major crisis.
So I don't think -- I do think there's much to it.
BLITZER: He's very good, Gloria, I think...
BORGER: Yes.
BLITZER: ...in explaining some of the complex issues in ways that all of us could understand.
BORGER: He is. He gets an A plus for explaining, for example, the AIG crisis, as he did on "Jay Leno." I thought he did a very good job of that.
But what he has to do tonight is not just give a bunch of A plus answers. He has to connect the dots for the viewers out there who are going to say, how is this going to effect my life?
How does this mean that I'm going to be able to keep my job?
What is this going to do to my 401(k) plan?
And explain to me why you have to do so many things at once, when actually I'm just really worried about my livelihood right now.
BLITZER: He has a good answer, when he's pressed often, you know, why are you doing all these things, why not just focus in on issue number one, the economy. Then you can deal with education, health care, energy independence down the road.
KING: He says that President Bush and even President Clinton before him, when the health care debate, the entitlement -- Medicare and Social Security -- he said he has been left a long list of festering problems that if you do not deal with them as soon as possible, you're, A, raising the price tag for when you do ultimately deal with them; and, B, you're cheating the next generation, because you need to deal with these as soon as possible.
The counterargument to that is can the system handle it all?
It's a process question. Many people say eh. But the other argument is, if you're going to deal with them all at once, Wolf, then the budget math will be critically tested.
Does it all add up?
And remember, again, the next test of Barack Obama politically is Democrats on the ballot in two years, not the president.
BLITZER: All right. I don't want anybody to leave, because we've got a -- we're counting down to the news conference. That's coming up in a little more than an hour or so from now.
Tomorrow, by the way, the National Urban League releases its report on the state of black America. We'd like to hear from you.
What is your assessment of the State of black America today?
Submit your video comments to iReport.com/situationroom and watch tomorrow for my interview with Marc Morial. He's the president of the National Urban League.
New developments in the crash that killed seven children and seven adults -- we're learning about an FAA warning involving the type of plane involved.
Does it have any link to this disaster?
Plus, what goes on when the camera goes off?
CNN's Jeanne Moos takes a Moost Unusual look at anchor antics.
(COMMERCIAL BREAK)
LOU DOBBS, HOST, "LOU DOBBS TONIGHT": Coming up at 7:00 Eastern on "LOU DOBBS TONIGHT," tonight, President Obama's second prime time news conference. We'll have complete live coverage for you.
Also, Treasury Secretary Tim Geithner begging Congress for more power -- unprecedented power -- to shut down companies such as AIG.
And the president unveiling plans to send hundreds of crime fighters to the Mexican border to combat the deadly drug violence that's sweeping across that border. Critics say the plan is long on rhetoric, short on specifics. We'll be talking about that with three of the nation's best radio talk show hosts. They'll tell us what it means, this word populism.
Join us for all of that and more at the top of the hour.
THE SITUATION ROOM continues in just a moment.
(COMMERCIAL BREAK)
BLITZER: An important new development in the search for clues to that fiery plane crash that killed 14 people in Montana.
Let's go to CNN's Ted Rowlands.
He's got the information.
What are you learning -- Ted?
TED ROWLANDS, CNN CORRESPONDENT: Well, Wolf, 12 days before this plane crashed, the FAA issued an airworthiness directive -- basically a warning -- concerning this aircraft, saying that anyone who owns this aircraft should bring it in to check out a certain component that might make it difficult to maneuver.
Well, late today, the NTSB said they are very aware of this, but they were able to find the component -- a core -- a cable in the wreckage scene. And they've been able to examine it and at this point, they don't believe that this directive -- this warning has anything to do with the crash.
That said, they are looking into it still and they haven't ruled it out. But at this point, the headline is the FAA directive, the NTSB does not believe, had anything to do with the crash.
What is the cause?
They're still looking into it. They plan to remove the rest of the wreckage today and move their investigation mainly to Washington, D.C. They're also retrieving some recordings from the pilot -- the last transmissions out of Salt Lake City, hoping for a clue as to why he diverted the plane from Boise, Montana to Butte.
But, again, the headline, the FAA directive, the NTSB doesn't think it had anything to do with the crash.
BLITZER: Seven adults and seven children killed in that crash.
All right, Ted, thank you.
In North Korea, new pictures of President Kim Jong Il go public, presumably to counter rumors about where he's been lately.
Meanwhile, Congress today also has been getting a closer look at new images that could shed new light on the Communist North's missile threat.
Our Pentagon correspondent, Barbara Starr, sorts out what commanders are saying.
BARBARA STARR, PENTAGON CORRESPONDENT: Wolf, U.S. commanders say there's every reason to believe North Korea is about to undertake a game changer.
(BEGIN VIDEOTAPE)
STARR (voice-over): North Korean state TV broadcast what it said were recent photos of leader Kim Jung Il, trying to show him alive and well. And in a few days, Pyongyang may show the world its missile program is also in good health.
North Korea says as soon as next week, it will launch a satellite on top of a missile from this site. The latest imagery shows continuing preparations at the launch pad.
GEN. WALTER "SKIP" SHARP, COMMANDER, U.S. FORCES KOREA: Kim Jong Il is in control. He will resort to many different types of provocations to try to ensure regime survival within North Korea.
STARR: A launch presents a potential crisis for the Obama administration. The U.S. calculates a North Korean missile could be over Japan within seven to eight minutes of launch. That means the U.S. will have as little as five minutes to decide whether to attempt to shoot it down. Pyongyang warned against any attempt to stop it.
UNIDENTIFIED MALE: We have concerns with missile activities in North Korea, as Skip mentioned earlier. But I think we -- I know we're ready to defend our territory and our allies.
STARR: Experts say any launch would give the North Koreans valuable military experience in developing long-range missiles that could hit the U.S.
(END VIDEO TAPE)
STARR: The latest U.S. intelligence assessment is that there is fueling equipment, gear and some electronics on the North Korean launch pad, but still no missile is visible -- wolf.
BLITZER: Barbara Starr at the Pentagon.
Thanks very much.
Let's check back with Jack for the Cafferty File -- Jack.
CAFFERTY: The question is what's the dollar really worth right now?
John in Louisiana: "Objectively, the world economy should not be pegged to the dollar. But it will continue to be as long as the U.S. is the dominant international player, that is. If that changes, though, all bets are off."
Mike writes: "With the recent spending proposals, the dollar is now worth much more than it will be 10 years from now." Randy in Winnipeg: "I remember the old days of the gold standard, when the dollar was redeemable at face value in pure gold. With the way the global economy has ebbed and flowed in the decades since, we've moved to paper. Time to see a return to gold. Governments can print all the money they wish, but there's only so much gold to go around."
Kimberly writes: "I'm glad to see that you and Wolf are so optimistic about the dollar. Frankly, I don't think it's worth a damn thing."
I'll tell you what, Kimberly. Send Wolf and I all your dollars if you don't think they're worth anything.
(LAUGHTER)
CAFFERTY: And we'll see what we can do with them.
Barry in Fort Wayne, Indiana: "We will only know the full extent of the value once all the countries holding our debt dump it. I figure it's really only worth the ink and paper it's printed on. Once our economy rebounds, hyper inflation will more than likely take over because of the irresponsible Congress members spending dollars like the Monopoly money."
Kim writes: "As long as the drug cartels, pirates, terrorists and other thugs in the world want dollars, they're valuable."
Robert writes: "About $1.23 Canadian. Do you want to trade?" And John in Alabama: "Good question. The dollar is worth two postage stamps and 16 cents in change. The dollar is worth a small cheeseburger with no drink or fries. The dollar is worth half a gallon of gas. The dollar is worth 20 pieces of bubble gum. The dollar is shrinking."
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.
BLITZER: Are you familiar with this book?
CAFFERTY: I've heard of this. I know this fellow who wrote it quite well, actually.
BLITZER: It's Now or Never
Getting Down to the Business of Saving Our American Dream".
I believe this book is available right now and in bookstores, is that correct?
CAFFERTY: Bookstores, online and I've got a few at the house if you want to come by. I'll sell them to you out of the garage.
BLITZER: You'll sign them too, right?
CAFFERTY: Absolutely.
BLITZER: You're going out. You're going to be on some shows. You're going to be promoting this book.
CAFFERTY: I'm going to do "The Daily Show" next Monday. I'm going to be on Larry King's program. I'm going to be on with Anderson maybe next week. I'm going to go on with Campbell Brown.
BLITZER: A bunch of radio interviews?
CAFFERTY: I did some radio this morning.
BLITZER: Good.
CAFFERTY: It's fun.
BLITZER: "Getting Down to the Business of Saving Our American Dream" -- now or never, Cafferty's new book.
CAFFERTY: Thank you, sir.
BLITZER: Good luck.
CAFFERTY: Thank you very much.
BLITZER: Now, here's something you don't normally see during your local TV news.
(VIDEO CLIP)
BLITZER: It kind of makes you wonder what else is going down during the commercial breaks. We're going to show you what's going on. Jeanne Moos is standing by.
And we'll also tell you what all the shouting is about in one of our Hot Shots.
(COMMERCIAL BREAK)
BLITZER: Here's a look at some Hot Shots coming in from our friends at the Associated Press -- pictures likely to be in your newspapers tomorrow.
In Indonesia, political supporters shout slogans and gear up for an election.
In Arkansas, a motorcycle shop owner testifies against the bill requiring helmets.
In Afghanistan, vendors wait for customers to buy phone cards.
And in Florida, State Representative Ron Reagan rappels down the Florida Capitol Building on National Guard Day.
Some of this hour's Hot Shots -- pictures worth a thousand words.
TV anchor downtime has always been an unseen mystery to viewers. But thanks to advances in technology, there's no such thing as downtime any more.
CNN's Jeanne Moos takes a Moost Unusual look at anchor antics.
(BEGIN VIDEOTAPE)
JEANNE MOOS, CNN CORRESPONDENT (voice-over): If you think listening to the news is depressing, imagine delivering it.
(BEGIN VIDEO CLIP, COURTESY WGN)
BOB BANGE, WGN NEWS ANCHOR: The burning building.
JACKIE BANGE, WGN NEWS ANCHOR: Three patrons were stabbed.
BANGE: An undercover drug operation.
BANGE: The toxic dirt ordinance.
(END VIDEO CLIP)
MOOS: Give us a break -- a commercial break. There's a name for this.
(BEGIN VIDEO CLIP, COURTESY WGN)
BANGE: What anchors do during commercial breaks. (END VIDEO CLIP)
MOOS: Well, maybe not all anchors.
(VIDEO CLIP)
MOOS: At WGN in Chicago, the weekend anchors do this in the first commercial break of every show. It started a decade or so ago.
BANGE: We were so tickled to hear our names, we went ooh, ooh, ooh...
BANGE: And we started pointing.
UNIDENTIFIED MALE: You're watching WGN News at 9 with Jackie Bange, Bob Jordan.
(END VIDEO CLIP)
MOOS: This used to be something only the crew got to see. But then it landed on YouTube.
(BEGIN VIDEO CLIP, COURTESY WGN)
BANGE: Whoa.
(END VIDEO CLIP)
MOOS: They have between two and two-and-a-half minutes until the commercial break ends.
(BEGIN VIDEO CLIP, COURTESY WGN)
BANGE: Oh, getting close.
(MAKING NOISES)
(END VIDEO CLIP)
MOOS: Moves range from...
(BEGIN VIDEO CLIP, COURTESY WGN)
BANGE: Remember the John Travolta move?
BANGE: Yes. You missed that.
(END VIDEO CLIP)
MOOS: To the Dick Cheney.
(VIDEO CLIP)
MOOS (on camera): Hold it. That is the famous fly move. It's based on an actual incident when Robert got caught on camera when he thought he was off-camera. (BEGIN VIDEO CLIP, COURTESY WGN)
BANGE: I see the fly zooming around and I started reaching for it.
(END VIDEO CLIP)
MOOS: Sure, there have been dancing weathermen on YouTube.
(VIDEO CLIP)
MOOS: Even dancing Iraqi anchormen.
(VIDEO CLIP)
MOOS: And one of WGN's own reporters couldn't keep still.
(BEGIN VIDEO CLIP, COURTESY WGN)
BANGE: Look, I've got to do my thing. I'll be right back. I've got to go wrap this up.
(END VIDEO CLIP)
MOOS: But this takes choreography.
(BEGIN VIDEO CLIP, COURTESY WGN)
(MAKING NOISES)
BANGE: Thirty.
BANGE: Forty.
(SINGING)
BANGE: She would try to go with me, poke my eyes out.
(END VIDEO CLIP)
MOOS: Borrowed from the Three Stooges.
(VIDEO CLIP)
MOOS: But don't call these two stooges.
(BEGIN VIDEO CLIP, COURTESY WGN)
BANGE: I try to add moves, she won't let me add new moves -- the ones that I like.
BANGE: But, you know, ask him what his move was. Please.
BANGE: I want to do the chest bump.
(END VIDEO CLIP) MOOS (on camera): So next commercial, when you take a bathroom break, remember these two breaking into their routine...
(voice-over): Working it right down to the last second.
(BEGIN VIDEO CLIP, COURTESY WGN)
(SINGING)
BANGE: Ten seconds.
BANGE: Ten seconds.
BANGE: It's coming on to a voiceover.
BANGE: We made it.
(END VIDEO CLIP)
MOOS: Back to the world of mayhem and destruction.
(BEGIN VIDEO CLIP, COURTESY WGN)
BANGE: Three, two, one.
BANGE: Several hundred people...
(END VIDEO CLIP)
MOOS: Two anchors who aren't quite anchored to their desk.
(VIDEO CLIP)
MOOS: Jeanne Moos, CNN, New York.
(END VIDEOTAPE)
BLITZER: Very, very good moves. Very nice. That's what happens during commercials.
I'm Wolf Blitzer here in THE SITUATION ROOM.
I'll be back in about 45 minutes or so from now. We'll have extensive coverage of President Obama's news conference.
Stay with CNN for complete coverage.
Our coverage begins 7:45 p.m. Eastern.
I'm Wolf Blitzer in THE SITUATION ROOM.
Up next, "LOU DOBBS TONIGHT" -- Lou.
