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The Situation Room
Banks vs. Automakers; Experts Without Experience; Blaming America for Bad Times; Bloody Assault on Police Academy
Aired March 30, 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: A bloody attack on a police academy -- militants kill trainees with guns and grenades.
How much more can Pakistan's fragile government take?
And the waters are no longer rising, but Fargo officials say their battle over the flood is not over yet. Residents are now facing a blizzard.
You're in THE SITUATION ROOM
Two U.S. automakers today may have moved closer to bankruptcy. Their recovery plans aren't good enough for the White House, so the Obama administration today sent Chrysler back to the drawing board and gave General Motors a short lease on life -- one that doesn't include the company's CEO.
Are the carmakers getting tougher treatment than the banks?
Let's go to CNN's Mary Snow.
She's got the story for us -- Mary.
MARY SNOW, CNN CORRESPONDENT: Well, Wolf, some say yes -- they are getting different treatment and tougher treatment. But it's a question sparking debate. And many say that this will surely serve as a warning sign to banking CEOs.
(BEGIN VIDEOTAPE)
SNOW (voice-over): The president's message was clear -- G.M. must have a new direction if it wants more government money. (AUDIO GAP). And the auto announcement comes just days after some of the nation's top banking CEOs met at the White House. And it's prompting the question -- what about the CEOs of banks getting billions in bailouts?
CNNmoney.com editor-at-large Paul Lamonica says there's a lot of head scratching.
PAUL R. LAMONICA, CNNMONEY.COM EDITOR-AT-LARGE: One source I spoke to said, you know, it seems like the automotive industry are being told, you know, don't play with fire, while some of the banking CEOs, they're being given matchbooks. So I think it is fair to wonder why there is this double standard in the two industries that are both getting bailed out. SNOW: But the comparisons aren't so cut and dry. In the case of G.M., Rick Wagoner was CEO for nine years and the company was losing money before the financial crisis.
Still, Michigan's governor says Wagoner is a sacrificial lamb. Among the banks, in the case of Citigroup, for example -- one of the biggest bailout recipients -- Vikram Pandit has been at the helm since late 2007. The previous CEO was edged out for the subprime mortgage mess.
But one economist says Wagoner's ouster signals pressure on banking CEOs.
JOSEPH STIGLITZ, COLUMBIA UNIVERSITY: So in the case of several of the banks, they're on -- the CEOs are relatively new. But the longer they're there and the more the problems fester, the more tarnished they are becoming.
(END VIDEOTAPE)
SNOW: Now, AIG, Fannie Mae and Freddie Mac all had changes in top executives when the government intervened last year and, for all intents and purposes, took them over. The departure of G.M.'s CEO is the first executive change for a bailout company since President Obama took office in January -- Wolf.
BLITZER: Mary Snow, thanks very much.
The presidential task force on the auto industry has 21 members. None have any direct real auto industry experience. Five are cabinet secretaries. Nearly half the members hold economic posts. Seven have ties to energy and the environment. Even the Treasury's senior adviser on auto issues, Ron Bloom, has no direct auto industry background.
One member of the auto industry task force is joining us now.
That would be Austan Goolsbee, a senior White House economic adviser.
Austan, thanks very much for coming in.
AUSTAN GOOLSBEE, WHITE HOUSE ECONOMIC ADVISER: Hi, Wolf.
How are you?
BLITZER: Is that fair, that none of you has any real direct auto industry experience?
GOOLSBEE: Well, I don't think it's fair, for two reasons. One, I believe that Ron Bloom does have a significant amount of experience and that is within the government task force. I mean there were a large number of experts who were involved in consulting with and talking to this task force.
And the other thing that I'd say is the president made clear in his remarks the U.S. government is not trying to get into the business of running an automobile company. That's not the intention here. The intention here is to create the conditions that would be a bridge allowing these companies to restructure and become viable enterprises...
BLITZER: Do you know...
GOOLSBEE: ...going ahead in the future.
BLITZER: Do you know off the top of your head what Ron Bloom's auto industry experience was?
GOOLSBEE: I -- no, I don't know. I believe that it was advising the unions and in working in the auto industry, but I'm not an auto executive so I -- that's not my area.
BLITZER: All right. We're going to double check that.
The decision to, in effect, fire Wagoner, the CEO of General Motors, was that the president of the United States?
Did he personally make that decision?
GOOLSBEE: Well, look, the situation, the -- Rick Wagoner has a good leader. He has a lifetime of service to G.M. The feeling of everyone involved is that if we're going to have a really significant switch in direction, we need a new vision. We need somebody different to lead it in a different direction.
BLITZER: And the president made that decision?
GOOLSBEE: Well, as I say, I think this -- this is a joint decision made by a lot of parties. And it's not the role of the president to be trying to run an auto company. That's not the intention here. It's to try to get this -- both of these companies, which are very different companies, Chrysler and G.M., each into a position where they'd be a viable enterprise going forward.
BLITZER: So you say it was a joint decision. But I assume the president of the United States signed off on it?
GOOLSBEE: I'm not going to speculate about who said what or decided what. The fact is that the Auto Task Force, under the direction of the president, believes that we've got a plan in place to give some time to these companies to restructure their enterprises and make them viable companies. The main thing that we are not going to do, as the president said, is we're not going to make them wards of the state that only survive because we're giving them money.
BLITZER: Has the White House been involved in his compensation package upon his retirement, Rick Wagoner from G.M.?
GOOLSBEE: I don't know the details on that.
BLITZER: Would that be something logical, though?
Would that be -- given the enormous amount of taxpayer money going into G.M.?
GOOLSBEE: I'm not going to speculate on those matters. I don't know anything about it.
BLITZER: Here's what Tennessee Republican Bob Corker said today in reacting to your decision: "Firing Rick Wagoner is a sideshow to distract us from the fact that the administration has no progress to announce today. The administration is hoping the media and the public will stay focused on Wagoner and fail to notice that negotiations have not progressed since November."
Well, let's -- specifically, has there been any progress in the negotiations with Chrysler and G.M. since November?
GOOLSBEE: Well, as I stated at the outset, it is not the role of the government to be doing the negotiations that would take place in this business. There have been extensive and continuing negotiations within the company in dealing with the stakeholders, the bondholders, labor, management, the dealers and all across the board.
What the president is trying to outline is a means by which G.M. and Chrysler, through two different approaches, could become viable enterprises going forward.
It was -- it is not the intention of the president to make the main announcement being the departure of the CEO of G.M. It's rather funny that the senator would say that. I don't know if he watched the president's remarks. The president went through his vision of the U.S. auto industry, that with sufficiently aggressive restructuring, we are trying to make these companies viable businesses. We are willing to give them...
BLITZER: All right...
GOOLSBEE: ...a bridge to somewhere. It can't be a bridge to nowhere.
BLITZER: And when you say restructuring, some sort of organized bankruptcy in order to allow G.M. and Chrysler an opportunity to renegotiate labor contracts, health contracts, other basic structure -- structures of their industry -- is that something that you think, down the road, is going to be necessary?
GOOLSBEE: Well, it's -- that is on the table. But let us not be, as the president outlined in his remarks, let's not be hung up on the phrase bankruptcy. That's not the issue.
The issue is one of restructuring, not liquidation -- that his design is to help these companies restructure.
And the approach taken with Chrysler and G.M. are very different because they're two companies in very different situations.
So when the president outlines that the government's going to put its full weight to guarantee the warrantees for consumers, that we are coming out of the last couple of weeks where we've created the direct guarantees for suppliers so that we don't start getting into a situation where they -- different companies don't want to deal with other companies, you've seen a commitment on the part of the government to help them have a bridge to somewhere. But the president has laid out tough conditions. And he said the restructuring plans that they've put forward so far are not adequate and they have to go farther.
BLITZER: Thanks very much for joining us, Austan Goolsbee.
GOOLSBEE: Great to see you again, Wolf.
BLITZER: The Treasury's point man, by the way, on auto issues, Ron Bloom, is a former investment banker who spent more than a decade with the United Steelworkers Union. He did broker a union contract with Goodyear Tire & Rubber. That may be as close as he's come to working directly with the auto industry.
The financial meltdown has swallowed up many companies. The biggest bankruptcy in U.S. history came last September, when Lehman Brothers -- Lehman Brothers, the giant investment bank, went under. Its core business was bought by the British bank, Barclays.
The nation's second largest -- second largest electronics retailer was another recession victim. After filing for bankruptcy protection, Circuit City closed all 587 stores this month. That left 34,000 workers unemployed. A sad day for a lot of them, obviously.
But not every bankruptcy means a going out of business sale. Delta Airlines was more than $20 billion in debt when it filed for bankruptcy in 2005. In 2007, Delta emerged from bankruptcy protection as an independent carrier.
President Obama heading to his first major international summit. And behind the pomp and circumstance, he may get an earful from other leaders over the global financial crisis -- why some of them are blaming the U.S.
Also, new details emerging of the horror and heroism in a nursing home massacre that left seven elderly patients and a nurse dead.
Plus, a probe beginning into alleged torture of detainees -- could former Bush officials be arrested and charged?
(COMMERCIAL BREAK)
BLITZER: Tight security in the streets of London right now, as police try to head off more protests ahead of this week's big economic summit. With America's economy lurching from crisis to crisis, President Obama will join leaders of the world's 20 largest economic powers to look for solutions to what is now a global meltdown. But the president may take heat for both the recession and his response to it.
Let's go to our senior political correspondent, Candy Crowley -- Candy.
CANDY CROWLEY, CNN SENIOR POLITICAL CORRESPONDENT: You know, Wolf, though he has traveled abroad as a candidate, this is President Obama's first overseas trip. And even something so bland sounding as the G20 Economic Summit poses a multitude of problems.
(BEGIN VIDEOTAPE)
CROWLEY (voice-over): As a candidate, Barack Obama drew a huge, adoring crowd in Berlin. That was before the global recession. And popularity will only go so far when President Obama debuts on the international stage at a 20 nation economic summit.
CHRYSTIA FREELAND, "FINANCIAL TIMES": You might even go so far as to call an ideological rift between the Europeans and the Americans.
CROWLEY: Simply put, the U.S. wants more countries to put more money into their ailing economies. Reaction has been cool to hostile.
The outgoing Czech prime minister blistered the idea and the Obama administration's response to the U.S. economic crisis.
(BEGIN VIDEO CLIP FROM MARCH 25)
MIREK TOPOLANEK, CZECH PRIME MINISTER: One of these steps -- the combination and the permanency is a way to help.
(END VIDEO CLIP)
CROWLEY: Rather than putting more money into ailing economies, many countries want greater financial regulation. As French President Nicolas Sarkozy put it: "We consider that in Europe, we have already invested a lot for the recovery and that the problem is not about spending more, but putting in place a system of regulation so that the economic and financial catastrophe that the world is seeing does not reproduce itself."
Making matters worse, many countries blame the U.S. for the global recession -- arguing the failing American banking system was the first domino to fall.
Include Brazil in that.
(BEGIN VIDEO CLIP FROM MARCH 26)
PRES. LUIZ INACIO, LULA DA SILVA, BRAZIL (THROUGH TRANSLATOR): This crisis was not created by black nor Indians nor poor people. It was a crisis that was created and spread throughout the world due to the irresponsible behavior of white people -- blue-eyed people that thought they knew everything.
(END VIDEO CLIP)
CROWLEY: Others have made the point without the racial implications.
The bottom line -- the shine has come off capitalism, open markets and deregulation. FREELAND: This economic crisis has definitely made America's bully pulpit in the world less effective. And you're hearing a lot of people from around the world saying, well, actually, maybe Americans don't have any -- don't have everything right.
(END VIDEOTAPE)
CROWLEY: Signals from the White House suggest the president does not believe it has to be either stimulus or tighter regulation. White House Spokesman Robert Gibbs says the G20 nations will find in the U.S. a partner willing to move the economy forward, as well as a partner willing to institute stricter regulation -- Wolf.
BLITZER: Candy Crowley, thank you.
A police academy is the scene of the deadly attack and a desperate battle. Gunmen today attacked the training center in Lahore, Pakistan, killing at least eight cadets and staff members before the facility was recaptured.
CNN's Reza Sayah has the latest -- Reza.
REZA SAYAH, CNN CORRESPONDENT: Wolf, this is militants in Pakistan once again taking the fight to the Pakistani government -- hitting the heart of this nation's security apparatus.
(BEGIN VIDEOTAPE)
SAYAH (voice-over): 7:30 a.m. Monday morning -- security forces take cover as armed militants, some in police uniforms, stormed the Manawan Police Training Center near Lahore, Pakistan.
Their target -- hundreds of cadets gathered for a weekly parade.
Military officials tell CNN the militants attacked the cadets with grenades and guns. Chaos ensued. Hundreds scrambled to safety. Others were trapped inside the compound. Officials say the militants took hostages and barricaded themselves inside a three story building inside the compound. A stand-off began.
For hours, the extremists and security forces exchanged gunfire. The security forces steadily gained the upper hand. By early afternoon, they had the militants cornered inside the building. By 3:30 p.m. they had them defeated. With three militants in custody and four others killed, security personnel celebrated.
But this was no time to celebrate for Pakistan's fragile civilian government.
REHMAN MALIK, PAKISTAN INTERIOR MINISTRY: It is the (INAUDIBLE)...
SAYAH: Rehman Malik, head of Pakistan's interior ministry, acknowledges the militants penetrated the compound with ease.
MALIK: The boundary wall is not very high. And according to the eyewitnesses, some of them actually crossed the boundary wall and some entered through the gate, injuring the guards.
SAYAH: The attack comes three days after U.S. President Barack Obama pledged to support Pakistan in the fight against militants. But Malik says Pakistan needs help now.
MALIK: We need -- need the help of the international community in capacity building, because our police is not exactly trained for the -- for such action against the terrorists.
SAYAH: Within hours, Malik named Baitullah Mahsud, the head of the Pakistani Taliban, as suspect number one in organizing the attack.
IMTIZAZ GUL, ANALYST: They are ready to kill and die with the help of small arms.
SAYAH: Analyst Imtizaz Gul calls Monday's attack "a security lapse." He says the attack is strikingly similar to last month's attack in Lahore on the Sri Lanka cricket team. Both times, militants used guns and grenades to ambush their target. Security forces could do little to stop them.
GUL: Pakistan's civilian security apparatus is not geared to taking on the challenge that Pakistan currently faces.
SAYAH: Until that changes, says Gul, militants will hit whenever and wherever they want.
(END VIDEOTAPE)
SAYAH: The Pakistani government has accused Taliban leader Baitullah Mahsud before in militant attacks, including December of 2007, after the assassination of former prime minister, Benazir Bhutto.
To this day, Pakistani authorities have not been able to capture Mahsud -- Wolf.
BLITZER: Reza Sayah reporting from Pakistan.
Thank you, Reza.
Six former Bush administration officials possibly facing torture charges in Spain.
What are the chances of any of them actually being arrested?
I'll speak about it with our CNN senior legal analyst, Jeffrey Toobin. He's standing by live.
Plus, the first lady, Michelle Obama, about to make her debut on the world stage.
What role will she play in her husband's upcoming European tour?
(COMMERCIAL BREAK)
BLITZER: Let's check in with Betty Nguyen once again.
She's monitoring some other important stories coming into THE SITUATION ROOM right now.
What's going on -- Betty.
BETTTY NGUYEN, CNN CORRESPONDENT: Hey there, Wolf.
You may not want to check your portfolio, because on Wall Street today -- one of the worst trading days of the year -- major sell-off sent the Dow Industrial Average plummeting after the White House rejected restructuring plans from both General Motors and Chrysler. At the end of the day, the Dow lost 252 points, to close at 75.22.
And Madonna -- well, she's spending a little time in Malawi. A court today delayed a ruling on her application to adopt a second child in African nation until Friday. So the singer spent the day with her three children, touring a day care center built by her charity. Now, critics complain Madonna's adoption plans are being fast-tracked because of her money and status. Her 3-year-old son David's adoption was finalized last year.
And we want you to check this out. It looks like a spaceship has landed on the National Mall in Washington. Look at that. What it is is a mock-up of NASA's new Orion crew module. The nine ton stainless steel ship can carry six astronauts and resembles the older Apollo modules. Orion is what NASA envisions for U.S. astronauts to inhabit on the next missions to the moon, even Mars.
And one of the earliest photographs in existence has sold at auction for a princely sum. Sotheby's Auction House sold this black and white daguerreotype to an unidentified buyer for $62,000. Now, the five-and-a-half by four inch photo dates back to 1848 and depicts a house on a hill in what is now Manhattan. It was on what was then known as Old Bloomingdale Road and referred to as the continuation of Broadway. It absolutely does not look like that anymore -- Wolf.
BLITZER: I'm surprised it only got -- what did you say?
How much -- 50 something?
NGUYEN: Sixty-two thousand.
BLITZER: Sixty-two thousand dollars?
You would have thought -- or at least I would have thought I would have gotten more. Maybe it's...
NGUYEN: Yes, taken back in the 1800s.
BLITZER: It's a sign of the times -- the economy not that good right now.
NGUYEN: Yes, it's true. Especially with digital cameras. You can take a picture for almost nothing these days, huh?
BLITZER: Yes. Look at Manhattan. Look at Manhattan. Wow!
NGUYEN: Yes.
BLITZER: OK.
Thanks very much.
NGUYEN: Sure.
BLITZER: The president now in the driver's seat -- the Obama administration forces out the head of General Motors, setting some tough terms for helping the automaker stay afloat. James Carville and Ed Rollins -- they're here. They're standing by live.
And quote: "Everything you could possibly imagine that is bad in this world" -- that's how a police chief sums up the slaughter at a North Carolina nursing home. But there were some acts of heroism.
And the recover is no longer rising, but flood fears are still gripping Fargo, which now faces a blizzard.
(COMMERCIAL BREAK)
BLITZER: To our viewers, you're in THE SITUATION ROOM.
Happening now, new satellite images and new concerns North Korea is on the verge of a missile launch.
But what is North Korea's goal?
And is the U.S. ready to shoot it down?
President Obama is preparing for his European tour and packing a secret diplomatic weapon -- that would be his wife. We're taking a closer look at the first lady, Michelle Obama's, role is shaping world opinion of the U.S. in the Obama era.
And finding a bittersweet gift in a public tragedy -- how the accident that killed the actress Natasha Richardson saved the life of one little girl.
I'm Wolf Blitzer.
You're in THE SITUATION ROOM.
President Obama getting tough on Chrysler and G.M. -- he's rejecting their latest turnaround plan, setting a deadline for restructuring. And he effectively fired G -- G.M.'s CEO.
(BEGIN VIDEO CLIP)
BARACK OBAMA, PRESIDENT OF THE UNITED STATES: After broad consultation with a range of industry experts and financial advisers, I am absolutely confident that G.M. can rise again, providing that it undergoes a fundamental restructuring. As an initial step, G.M. is announcing today that Rick Wagoner is stepping aside as chairman and CEO. This is not meant as a condemnation of Mr. Wagoner, who has devoted his life to this company and has had a distinguished career. Rather, it's a recognition that will take new vision and new direction to create the G.M. of the future.
(END VIDEO CLIP)
BLITZER: Let's get right to our CNN political contributor, the Democratic strategist, James Carville; and our CNN political contributor, the Republican strategist, Ed Rollins.
Guys, thanks for coming in.
James, do you feel comfortable with the president of the United States effectively firing the CEO of G.M.?
JAMES CARVILLE, CNN CONTRIBUTOR: Well, you know, I feel a little bit like -- you and I are sports fans, as is Ed -- where you've got to really -- coaches are really -- Rick Wagoner seems like a good talented guy, but the team's been on the losing streak. I think the president felt like they had to do something and he's the head coach. I like Rick Wagoner. Let it be said that GM is making better cars today than when he came aboard. He's caught in a bad situation. I'm sure he understands. I bet the president under stands --
BLITZER: At the same time, when I interviewed one of the president's top advisers, I kept asking, did the president personally sign off on the firing of Rick Wagoner; he was moving around and not confirming that. Is there a problem with simply saying yes, it went to the president and he signed off on it?
ED ROLLINS, REPUBLICAN STRATEGIST: It should have gone to the president. This is the big move. A symbolic move. I know how a White House works and if this decision didn't go to the president and he didn't make the decision, he's not doing his job. I'm sure James would agree.
CARVILLE: I completely agree with that. I completely agree and if it was and the president didn't know, that would not be very good.
ROLLINS: So in answer --
He should have said yes, absolutely, the president made his decision.
BLITZER: Because I raised the question, I remembered in the Reagan administration, you worked for Reagan when he fired the air traffic controllers. He took personal responsibility for that.
ROLLINS: He also made the decision. The secretary of Transportation wasn't quite sure and there are other arguing points and Reagan said no we need to do this. They violated the law and I'm making the decision.
BLITZER: James, you want to add anything?
CARVILLE: What likely happened is the board recommended this and told the president and he didn't object. I don't know what happened, but I think that's a likely scenario. I'm sure he knew about this.
BLITZER: Do you have a problem, James, with the fact that several leaders of Michigan, they weren't consulted in advance about the firing of Rick Wagoner, but just told about it?
CARVILLE: I can understand where feelings would be bruised, but this GM problem is a big problem for the country and taxpayers and things had to move in a different direction. I suspect that once you start notifying people where do you stop, I don't know. I could see where fears are bruised, I'm sure Senator Levin, who's a very good guy, is upset. I don't know Rick Wagoner, he seems like a talented, decent guy who was dealt a bad hand. Like I said, it's like a coach who's got to go, but you hate to see it because he's a good coach.
BLITZER: I got the sense listening to the president this morning because he is giving Chrysler 30 days and GM 60 days. Correct me if I'm wrong, we're using all these sports analogies, he sort of punted.
ROLLINS: I agree with James. It's not basically an indictment of him, but I think we want to save GM. I think the decision is that Chrysler can't save itself. If they don't do the merger, they're going out of business. GM is a longer term investment by the American taxpayers and we want a management that we're going to have confidence in. I think that's the decision the president's made.
CARVILLE: And the real tragedy is GM actually makes very good automobiles. It just gets lost in this debate. They're the highest rated cars in the world right now. They've gotten around to producing some good automobiles and I think Rick Wagoner deserves some credit for that.
ROLLINS: There used to be a saying -- we're never going to sell that many again and I think we have to rethink the whole process here of what is American industrial business and manufacturing.
BLITZER: What's the most important thing, Ed, the president needs to think about as he goes to Europe?
ROLLINS: He's going to be measured not just by the United States anymore. It's a world measurement. It's a short meeting with a lot of players. He has to be sure of his presentation. There are people who want to push him a around a little bit. This is a real test of his meddle. You seldom get to make a second impression on world leaders.
BLITZER: They love him around the world, but not necessarily the fact there's a global, economic recession and most blame the United States for that.
CARVILLE: It's all right. Everything is true, but the United States' position globally has, I hate to say this, has deteriorated somewhat. His skills and ability to do things are going to be pretty much on trial here. It's not like we run the world here as we used to. A lot of people around the world as they've pointed out, blame us for what's going on. ROLLINS: Probably more ill will than any president faces in modern times. Not because of him, it's because of the Bush administration or whatever, the world economy. It's a real test for him and obviously, we hope he does well.
BLITZER: And we'll see if the criticism stops at the water's edge, if you will and we'll see what happens when he's in Europe. Guys, thanks very much.
Tomorrow, President Obama, as we've been reporting, goes to Europe. This will be his first overseas trip as president. What do you think is a most important thing he needs to do while there? Send us your video comments to ireport.com/situationroom and watch tomorrow to see if your comments get on the air.
And a gunman on a deadly rampage in a nursing home, the 911 tapes have been released. We're going to play them for you. That's coming up.
And disaster averted for now, but a new storm approaching Fargo, North Dakota. The mayor of Fargo is standing by live.
(COMMERCIAL BREAK)
BLITZER: Fargo's still facing the threat of a catastrophe flood, but it seems to be receding. Let's go to Chris Welch. She's our man on the scene.
Chris, you had a chance to see it. How did it go?
CHRIS WELCH, CNN CORRESPONDENT: The snow's coming down pretty hard, making it difficult to tell exactly where the flood waters end and snow covered land begins. Today, we had a chance to go up with a pilot here from the Fargo Jet Center. Check out what the land and water looked like from that vantage point. It's actually pretty astonishing to look at it from that angle because if you stay in the immediate Fargo-Moorhead area, a lot of the damage really is a little bit further out and it's tougher to get to because authorities and law enforcement officials want everyone to keep out of that area including people whose homes have been effected. So it's very tough to tell but when we went up today, you could see these homes with water going up to the second level with the manmade dikes, the sandbag dikes, that have broken surrounding the homes. It's a tough image to see, but hopefully people are hoping it doesn't get any worse.
BLITZER: Chris, stand by. As Chris mentioned, the approaching storm is threatening the situation, with high winds that could whip up the river creating waves that could batter the sandbags holding that river back. Let's go to the mayor of Fargo, Dennis Walaker. He's joining us right now.
Mayor, is it too early to say you dodged a bullet?
MAYOR DENNIS WALAKER, FARGO, NORTH DAKOTA: Yes, absolutely. We're at high alert right now. The snow doesn't bother me. Even the talk about wave action within the city. It's going to affect all of the farms and so forth and those people that don't have the protection we have in the city. This is not needed by any stretch of the imagination. We need this to go away. The forecast, they're talking about maybe a 38 to 39-foot crest again, a second crest, sometime in April. No, it's really quite nice here.
BLITZER: Because at some point, the snow and ice have to melt and what you're suggesting, are you saying that's going to make it more of a threat to flood?
WALAKER: Well, the river right now is starting to drop. It's down from the previous crest, which was the highest crest we've had in the red river valley in the history of the settlement.
BLITZER: We were talking about maybe 42 or 43 feet. What was the highest it reached?
WALAKER: Just about 41.
BLITZER: And the levees that you can have around Fargo, they can with stand up to 42 or 43?
WALAKER: We wanted everybody to go to 43. It's particularly a process of watching your dike, pumping the water out from the other side. Temperatures next week will be in the mid-30s, with the temperatures going lower than that in the evening, so that's good. You have to have rain and heat to turn this snow into moisture into liquid. That's not going to come here until some time next week.
BLITZER: We're going to stay in close touch with you. Good luck to you and everyone in the region.
WALAKER: Thank you.
BLITZER: The sound of horror as it happened. The shocking 911 call that alerted authorities to the slaughter at the North Carolina nursing home.
And they were seconds away from losing her. How CNN's coverage of a celebrity's death helped a couple save their child's life.
Stay with us. You're in THE SITUATION ROOM.
(COMMERCIAL BREAK)
BLITZER: The 911 tapes have just been released from that North Carolina nursing home massacre that left eight dead. Let's go to T.J. Holmes. He's been listening to those tapes.
It's pretty chilling what happened and what you're hearing T.J.
T.J. HOLMES, CNN ANCHOR: Yes, chilling on those tapes. Even one person that called said they had been shot. Now, as bad as this was, we know eight people are dead, but as bad as it was officers saying it could have been a lot worse. That town has only 18 police officers in its entire police force. At the time of the shooting, only one police officer was on duty and now that one being credited for saving the day single handedly and with a single shot.
(BEGIN VIDEOTAPE)
HOLMES (voice-over): North Carolina investigators are searching for evidence that could tell them why a gunman shot and killed seven elderly nursing home patients and a nurse on Sunday morning.
MAUREEN KRUEGER, MOORE COUNTY, N.C. DISTRICT ATTORNEY: The information on motive is incomplete at this time. We can share this. This was not a random act of violence. There is only one suspect and he is in custody.
HOLMES: The suspect now identified as 45-year-old Robert Stewart. The police chief confirms local reports that say Stewart's wife worked at the nursing home.
CHIEF CHRIS T. MCKENZIE, CARTHAGE, N.C. POLICE: It was my understanding that he had one wife that he may have been separated from, but to the details as to whether or not she was there is yet to be determined.
HOLMES: Police say Stewart was carrying multiple weapons when he entered the center and opened fire on the defenseless elderly patients. Listen to a couple of the 911 calls that started coming in --
UNIDENTIFIED MALE: 911 --
UNIDENTIFIED FEMALE: Hurry, hurry.
UNIDENTIFIED FEMALE: They're on their way.
UNIDENTIFIED FEMALE: Hurry.
UNIDENTIFIED FEMALE: They're on their way!
UNIDENTIFIED FEMALE: They're close, they're close!
UNIDENTIFIED FEMALE: They're on their way.
HOLMES: Carthage Officer Justin Garner was the first on the scene went in alone, no backup. Police say Garner was shot in the leg, but managed single shot that hit Stewart in the upper torso.
(END VIDEOTAPE)
BLITZER: Have we heard from Officer Garner yet?
HOLMES: No, we have not yet. The families asking for privacy for right now. We understand he is resting comfortably at home right now. While he did exactly what the police are trained to do even though he's the only one on the scene, don't wait for backup when people are in immediate danger. That was the case. He went in and is credited with stopping this bloodshed.
BLITZER: He's a genuine hero, Officer Garner. What about the condition of the suspect?
HOLMES: They're not releasing a lot of information about the suspect, a lot about his condition. However, is expected to survive, not life threatening the injury he does have. He's all right and well enough to get in front of a judge, he is facing eight counts of murder.
BLITZER: What a horrible story. All right. Thank you very much for that report, T.J. Holmes reporting.
Six former Bush administration officials could face torture charges in Spain. The top Spanish judge has asked prosecutors to review a complaint by human rights lawyers that the officials including the former attorney general Alberto Gonzales and former under-secretary of defense Doug Feith gave legal cover to the torture of suspects at Guantanamo Bay. Spanish law gives courts jurisdiction beyond the country's borders. Let's go to our senior legal analyst Jeff Toobin.
How serious of a deal is this for these six Bush administration officials?
JEFFREY TOOBIN, CNN SENIOR LEGAL ANALYST: Well, I think it's really more evidence of how unpopular the Bush administration still is in Europe than evidence of an actual prosecution that will take place. There are many steps that have to be accomplished before this becomes an actual criminal case. But the prosecutor, the investigating judge in Spain, Mr. Balthazar Corazon, he's the man who has done this before, most famously in prosecuting Augusto Pinochet.
BLITZER: If they do go ahead and indict these six Americans Interpol would presumably get involved. If they travel, to, say, Europe, what would happen?
TOOBIN: The first step is whether any charges would be brought. The basis of the charges would be torture that might have been committed against five Spanish citizens who were prisoners in Guantanamo. But the idea is if charges are brought, I don't think there's any chance that the police would come get them in the United States. But if they were to travel to Spain, they might well be arrested. And there have been American officials, including Henry Kissinger, who had had to avoid certain countries at times because of these investigations. Kissinger was never charged, but he was under the same kind of investigation.
BLITZER: Would it just be Spain? What if they went to other European Union countries?
TOOBIN: As far as I'm aware, that Interpol has not said that they would arrest someone in other European countries. It would be limited to Spain. But certainly, this kind of investigation -- first of all, it's extremely embarrassing. Second of all, there's an actual peril of arrest somewhere. So I think the exact parameters aren't known, but it would be a major, major issue if an American, senior American officials like this were ever actually placed under arrest, if arrest warrants were issued in Spain. BLITZER: Let's talk about more of these officials. John Yoo and David Addington who is vice president Cheney's chief of staff.
TOOBIN: David Addington was the top person in vice president Cheney's staff after Scooter Libby was indicted. John Yoo is infamous as the author of the torture memo. And one of the others, Jay Bybee, the least known of the six, he's actually a judge on the United States court of appeals in the United States. He was confirmed for his judgeship before any of these memos came out. And so he, a judge, is actually under criminal investigation here.
BLITZER: So what's your assessment of this judge? You point out he did eventually get Pinochet to come to Spain from Chile and they held him for a couple years before they let him go.
TOOBIN: I think the chances of this case going forward to an actual arrest are remote. Probably very remote. But I do think it's an illustration of something you see all over Europe, this tremendous hostility to the Bush administration, especially about the issue of torture, Guantanamo. As I say, I don't think this is going to proceed to an actual criminal case, but Germany has had an investigation like this, Spain has had one. I think we'll see more of this kind of investigation over the next few years.
BLITZER: Thanks very much, Jeff Toobin, our senior legal analyst.
Who is spying on the Dalai Lama? An investigation into computer hacking reveals that Tibet's spiritual leader may be one target of a vast cyberespionage network.
And can Michelle Obama help rebrand America? A closer look at the pivotal role she plays had her husband's upcoming trip to the G20 Summit and beyond.
(COMMERCIAL BREAK)
BLITZER: Michelle Obama's about to make her first trip abroad as the first lady of the United States traveling with her husband to the G-20 summit in London and then beyond. Our senior political analyst Bill Schneider is joining us live.
What can the first lady accomplish as she joins her husband on this trip?
WILLIAM SCHNEIDER, CNN SENIOR POLITICAL ANALYST: Well, Wolf, she can play a role in the rebranding of America.
(BEGIN VIDEOTAPE)
SCHNEIDER: Like her husband, first lady Michelle Obama has star power. When she accompanies her husband to Europe this week, it's likely to double the wattage.
MICHELLE OBAMA, FIRST LADY: I believe in this nation. And I believe in my husband. SCHNEIDER: President Obama's policies have been under attack abroad as well as at home.
MIREK TOPOLANEK, CZECH PRIME MINISTER (through translator): He talks about a large stimulus campaign buy American campaign, all these steps in combination and permanency is a way to hell.
SCHNEIDER: Some foreign leaders are resentful because the financial crisis that threatens to undermine the world economy started in the United States.
PRES. LUIS INACIO LULA DA SILVA, BRAZIL (through translator): It was that crisis that was created and spread throughout the world due to the irresponsible behavior of white people, blue-eyed people that thought they knew everything but are now showing they knew nothing.
SCHNEIDER: President Obama's mission is to rebrand the United States as a force for change and hope in the world just as John F. Kennedy once did. Jacqueline Kennedy was an important asset to JFK. Her charm and sophistication were a sensation overseas. Michelle Obama also embodies a new American brand, diversity and accomplishment. CNN has learned that the first lady will venture out twice on her own. She will visit the Jewish quarter of Prague, and in London, she will visit a school for underprivileged girls where she is likely to make a strong statement about women's rights, just as she did recently at the White House.
M. OBAMA: The difference between a struggling family and a healthy one is often the presence of a strong woman or women at the center of that family.
(END VIDEOTAPE)
SCHNEIDER: An African-American first lady will pay tribute to women and to Jews. It's the new face of America -- Wolf?
BLITZER: Thanks very much, Bill Schneider.
To our viewers, you're in THE SITUATION ROOM.
Happening now, President Obama threatens to pull the plug on GM and Chrysler if they don't do more to help themselves.
