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The Situation Room

Break in Volcano Gridlock; Fraud Charges and Financial Reform; America Divided; Trusting Government; Kansas Comeback

Aired April 19, 2010 - 17:00   ET

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

SUZANNE MALVEAUX, GUEST HOST: Thank you, Rick.

Happening now, the volcanic cloud over the airline industry -- the ash is easing, but thousands of planes remain grounded across Europe and beyond.

Will the gridlock ultimately cost every airline passenger big bucks?

Plus, 15 years ago, anti-government anger exploded in Oklahoma City. Some are afraid the political climate right now could trigger a new act of homegrown terror. Well, I'm going to ask Homeland Security Secretary Janet Napolitano about that and what the Feds can do.

And can Democrats bank on passing financial reform?

They may have a valuable new asset in the government's fraud case against Goldman Sachs. And there are a lot of questions about the timing of the lawsuit.

Wolf Blitzer is off today.

I'm Suzanne Malveaux.

And you're in THE SITUATION ROOM.

Well, millions of stranded airline passengers now have new hope of flying home five days after a volcano paralyzed international air traffic. European officials today announced plans to partially reopen the skies to some flights tomorrow. The volcano in Iceland is still -- yes, it is still erupting. But the ash that's been spewing across the continent, it's not as thick as it had been.

Our CNN's Gary Tuchman is following the story for us in Iceland.

GARY TUCHMAN, CNN NATIONAL CORRESPONDENT: Ten minutes away from here, complete sunshine. But now day has turned into night. This is ash plume from the volcano just to the north of us. It is literally raining ash right now -- going in our eyes. And you can see here in the ground, the ash is starting to cover the ground.

In the western part of Iceland, in this direction, life is almost completely normal. In Reykjavik, the capital, the winds haven't blown in that direction so they haven't seen any of this ash. But to the south of the volcano, to the east of the volcano, this is going on right now.

The people who live here -- this is a farm. There are farmers who live here. And you can see, you can't see their land. It's covered with ash. It's unknown how much property damage these people will suffer.

But the problem is you can't clean it up because they don't know how long the volcano will last. We visited a farm yesterday. The farmer had ash that turned into mud. He wasn't sure how long it would last before he got more ash. And today, his farm is right down the street -- covered with ash again.

It's unknown how bad these health effects are, but certainly the situation is very serious. It's just surreal right now that you can't see anything whatsoever because we are in an ash storm.

This is Gary Tuchman, CNN, in Colsvalur (ph), Iceland.

(END VIDEO TAPE)

MALVEAUX: Well, about 8,000 to 9,000 flights were expected to take off in European air space -- that happening today -- less than a third of the usual traffic on a Monday. This volcanic eruption is likely to leave a huge financial mark on the airline industry long after this ash is going to blow away.

Well, our CNN's Richard Quest, he covers the airline industry in Europe and around the world and he joins us in New York.

Good to see you -- Richard.

One of the big questions that we're all wondering here is, does this mean higher ticket prices for Americans now?

RICHARD QUEST, CNN INTERNATIONAL ANCHOR: Not in the short-term, I wouldn't have thought, for two reasons. The losses that are being experienced by the U.S. carriers are fairly limited -- I would say anywhere between $5 million and $10 million a day. Compare that to something like Lufthansa, which is completely closed down, at $34 million a day.

And the second reason is, even if they wanted to put up the prices, the pricing pressure by airlines at the moment simply doesn't exist. You put your prices up, you may hope others will follow. When they don't, Suzanne, you have to bring them back down again. I wouldn't look for any pricing -- price rises immediately as a result of this.

What I think. You're going to see over the next few days, of course, is just the sheer difficulty of travel, Suzanne. Even though there are these modest easing of restrictions, just in the last hour, we've heard that German air space will be -- will remain closed until tomorrow afternoon, Germany time -- Suzanne, putting it together, we are a long way, I think, from anything like normal aviation in Europe.

MALVEAUX: Well, Richard, we heard from the White House spokesman today, Robert Gibbs. And he said that there were actually what -- I think it was actually on Friday, 40,000 Americans who are stranded over there. Obviously, a lot of people who are upset at airports around the world.

Is this going to have, potentially, a domino effect around the world, when you take a look at, in Kenya, for instance, those vegetables that are just sitting there rotting or even in China, those cargo planes that have flowers that are just -- it's just stuck there on the tarmac?

QUEST: You've got three -- four groups of -- of, if you like, affected people -- business travelers who simply neither can't get where they want to or get home. A lot of them will have canceled their trips. Tourists who've got to take their trips because they're on vacation and if they don't get their trips, then they lose their money. You've then got cargo. Cargo can be the big heavy stuff. But that tends to go by boat. No, the cargo we're talking about is the high value, rotting, perishable cargo. It may be flowers from Kenya, carnations from Amsterdam. It may be high -- high value semiconductor chips from Asia. That is where. You're going to see some serious effects in terms of industry.

You cannot have this level of dislocation in aviation without there being a wider effect. And the real question, of course, in Europe is whether this could snuff out the fledgling recovery. At the moment, it doesn't appear to be that's the case.

MALVEAUX: OK. Well, I guess that's a little bit of good news to the story here. But, obviously, still thousands and thousands of frustrated passengers around the world.

Richard, thank you so much.

QUEST: Thank you, Suzanne.

MALVEAUX: Well, Iran's president thumbing his nose again at the United States, while the Pentagon is updating its options to take on Iran's potential nuclear program. Now a senior adviser says that President Mahmoud Ahmadinejad has approved sites for new uranium enrichment plants.

Our Pentagon correspondent, she's here with us more about how the U.S. Military might respond to Iran's nuclear defiance -- and, Barbara, obviously, there are contingency plans that are in place. You've got new details.

Tell us what this is about.

BARBARA STARR, PENTAGON CORRESPONDENT: Well, you know, Suzanne, a lot of this is front and center today in Washington because of a "New York Times" article suggesting that Defense Secretary Robert Gates was sounding a wake-up call about planning -- military planning for Iran.

Now the White House and the Pentagon says that is not what's going on. But, indeed, there is stepped up military planning just in case it's needed.

(BEGIN VIDEOTAPE)

STARR: (voice-over): Iran's military on parade this weekend -- President Mahmoud Ahmadinejad saying Iran is now so powerful, no country would dare attack it.

Iran's ultimate threat -- its nuclear weapons development program. But the White House Monday pointing out the regime's already had trouble making weapons grade fuel.

ROBERT GIBBS, WHITE HOUSE PRESS SECRETARY: The rhetoric of Iran and their nuclear program does not always meet the reality of what they're capable of.

STARR: But while diplomacy is the top option, the Pentagon has stepped up planning in case strikes are ordered. In January, Defense Secretary Robert Gates sent the White House a classified memo listing policy and military priorities. Gates saying in a statement over the weekend, quote: "The U.S. is prepared to act across a broad range of contingencies." Admiral Michael Mullen, chairman of the Joint Chiefs of Staff, several weeks ago, ordered his military planners to review and update options to be ready should President Obama ask for them.

Hints on Capitol Hill have been emerging.

SEN. CARL LEVIN (D-MI), INTELLIGENCE COMMITTEE: Do they include options of a maritime quarantine or a blockade of Iran's oil exports or import of refined petroleum products?

MICHELE FLOURNOY, UNDERSECRETARY OF DEFENSE FOR POLICY: Senator Levin, as the president said, all options are on the table. We see it as the Department of Defense's responsibility to plan for all contingencies and proofs (ph).

STARR: If there is a strike, the military would consult its so-called "targeting folders," which contain classified intelligence on target locations, whether targets are buried underground, the risk of civilian casualties and recommendations on which bombs to use in the strike.

But a U.S. attack may change little inside Iran.

UNIDENTIFIED MALE: We'd probably delay them. But that, if they're persistent enough, they could, at some point, succeed.

Is that a fair judgment from your position?

GEN. JAMES CARTWRIGHT, VICE CHAIRMAN, JOINT CHIEFS OF STAFF: That's a fair judgment.

UNIDENTIFIED MALE: So that the only absolutely dispositive way to end any potential would be to physically occupy their country and to just dis -- disestablish their nuclear facilities.

Is that a fair, logical conclusion?

CARTWRIGHT: Absent some other unknown calculus that would go on, that's a fair conclusion.

(END VIDEO TAPE)

STARR: And look, nobody is talking about invading Iran to deal with all of this. And that's the fundamental problem with a military option. Unless Iran's leaders are going to change their mind and give up nuclear weapons development, a military strike would only delay it -- Suzanne.

MALVEAUX: Thank you, Barbara.

And the Obama administration continues to emphasize that diplomacy is the way -- the first option that they want to go.

Thank you so much.

Well, a financial giant is battling fraud charges and becomes a foil in the political fight over financial reform.

How will the case against Goldman Sachs play in the Senate showdown brewing this week?

And a powerful blow to Al Qaeda in Iraq -- we're getting new information about the killing of two senior leaders of that terrorist group.

And President Bill Clinton's warning about anti-government anger in this country and how bitter words can unleash deadly violence. Stand by for his candid conversation with our own Wolf Blitzer.

(COMMERCIAL BREAK)

MALVEAUX: Jack Cafferty is here with The Cafferty File -- hey, Jack, it's good to see you.

CAFFERTY: Hi, Suzanne.

Likewise.

You might call it health care reform take two. The financial reform bill they're going to start debating in the Senate this week might just set the stage for the next big partisan showdown on Capitol Hill. In what may be another political miscalculation by the Republicans, all 41 Senate GOP members say they are united in opposing the legislation and that they want to see a more bipartisan and inclusive approach. Some are already promising to filibuster.

Republicans claim that the bill would continue the Obama administration's intervention into private enterprise.

Ironic when you consider that the original $700 billion TARP bailout happened under Republican President George W. Bush and his Treasury secretary, Hank Paulson. And those hundreds of billions of taxpayer dollars simply vanished into the pockets of the big banks with very few strings attached. The Democrats claim that this bill will actually prevent future taxpayer bailouts of failing banks. It would create a consumer protection office for investors, regulate some of the complex investments that led to the collapse and create a $50 billion failure fund financed by the banks.

Treasury Secretary Tim Geithner says he's confident the bill will pass Congress. And if Senate Democrats can nail down one or two Republican votes, a lot of people think that will open the floodgates and a bunch of others will begin to support it, as well.

Even conservative columnist George Will thinks, in the end, there will be plenty of bipartisan support. He says Republicans don't know what they want and he estimates that this bill will pass with 70 votes.

Here's the question -- what's behind the Republicans' opposition to financial reform?

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

MALVEAUX: Thank you, Jack.

Well, it seems like a safe bet that the name Goldman Sachs is going to come up a lot during the Senate showdown over Wall Street reform. The Securities and Exchange Commission's lawsuit claims fraud against the financial giant and it's adding a whole new dimension to this reform debate.

Now, I want to bring in our senior political analysts, Gloria Borger and David Gergen, to talk about this a little bit.

I want to start off, obviously, by mentioning that President Obama, on Thursday, he's going to be going to Wall Street. He's going to make the case, hey, I'm for the little guy, I'm going to get tough on Wall Street -- on the big banks here, they need tighter regulations.

We heard from a prominent Republican on the Senate floor, Senator Bob Corker of Tennessee.

And I want you guys to take a listen to how he put this debate -- what he wants.

(BEGIN VIDEO CLIP)

SEN. BOB CORKER (R), TENNESSEE: I think both sides of the aisle are trying to cast the characters in certain ways. There's sort of this herd process that happens around here, right?

I mean everybody wants to get everybody on the same team. And so what we do is we use rhetoric that sort of charges people up and gets everybody -- everybody on the same team. I don't like that process, Mr. President. I don't want to be a part of that process, Mr. President.

(END VIDEO CLIP) MALVEAUX: So the senator's arguing here, he wants to try to move Republicans kind of in the middle of the road, at least when it comes to rhetoric, to -- to move this thing forward -- Gloria, I want to start off with you here.

Why are -- why are the Republicans dead set against this legislation?

GLORIA BORGER, CNN SENIOR POLITICAL ANALYST: Well...

MALVEAUX: Or are they moving in a different direction?

BORGER: You know, Suzanne, they're not all dead set against it. Senator Corker, for example, is somebody who has been working for months to try and get some kind of financial regulation bill. So I think what got Senator McConnell, their leader, riled up was this notion of a -- of a fund that's paid for by the banks to help banks die, so that you do not create a panic on the street when a bank goes under. That's up for negotiation.

But having said that, I've talked to a number of Republicans in the Senate, one in particular who said to me, look, this is very different from health care reform. There are enough of us who want a bill to pass that if we disagree with our leadership, who may want an issue, then we will hold their feet to the fire and we will try and get a bill passed.

If you look at that poll today that Pew did, the only area in which the public wants Congress to intervene, Suzanne, is financial regulation. They want Wall Street regulated.

MALVEAUX: So, David, just following up on that regarding -- what -- what is the impact of the timing of that announcement regarding Goldman Sachs?

DAVID GERGEN, CNN SENIOR POLITICAL ANALYST, FORMER PRESIDENTIAL ADVISER: Well...

MALVEAUX: How is that going to play into this?

GERGEN: Well, so far, it has played very much into the president's hands and the Democrats' hands. The president is going to -- this Thursday to New York City. He's going to be speaking right near Wall Street in order to push for this legislation. And so, obviously, they think this is a windfall for them.

Barney Frank and Chris Dodd have both said this really helps us a lot. It -- the Organized for America, the -- you know, the grassroots effort that the White House helps to direct, they immediately rushed in. If you -- if you check out on Google, Goldman Sachs SEC, there you'll find an ad for Organizing for America. So they see it as very helpful.

But I would -- I would add there are now critics starting to say, wait a minute, this is -- it looks more and more, the critics suspect -- and Eliot Spitzer said today there was nothing coincidental about the SEC filing at this particular time. Yes, there's an independent agency, but they read the newspapers.

BORGER: (INAUDIBLE).

GERGEN: And they filed it at a sensitive time. We've learned today that the SEC vote internally was 3-2, three Democrats voting to bring these charges against Goldman Sachs and two Republicans voting against.

MALVEAUX: I want to...

GERGEN: That -- that set off speculation in the stock market that, in fact, it may be hard to make these charges stick. And Goldman Sachs' stock actually went up at the end of the day today.

MALVEAUX: And, Gloria, I wanted to follow up on what you had said before about -- obviously there's that $50 million fund, potentially, to bail out the banks here.

What is the likelihood that that is actually going to be a part of this?

Because we know that the White House and the president has gotten involved himself, saying that that's not something they want as a part of this legislation.

BORGER: Yes, I -- look, I think if you're talking about an area ripe for negotiation, that's one area that's -- that's ripe for negotiation. But I -- I think here that the White House -- and it's very different from -- from health care reform. You look back to health care reform, it took the president quite some time to start getting involved. We didn't know where he was on the public option until last August.

When it comes to this bill now, you're seeing the president go to Wall Street, word from the White House maybe we can negotiate on the -- on the so-called bailout fund. We want to change, perhaps, the way we're handling derivatives. You see the Treasury secretary...

MALVEAUX: Right.

BORGER: -- making call after call on the Hill. So this is a White House that wants to get this done. And the president will be out there personally doing it.

MALVEAUX: OK. We're going to have to leave it there.

Gloria and David, thank you so much.

GERGEN: Thank you.

BORGER: Sure.

MALVEAUX: All right

Well, bullets are flying in Iraq and two terrorist leaders go down. Ahead, new information about the setback for Al Qaeda in Iraq and what it could mean for global security.

And stand by to find out why the father of our country owes a substantial debt to New York City.

(COMMERCIAL BREAK)

MALVEAUX: Deborah Feyerick is monitoring some of the other top stories that are coming into THE SITUATION ROOM right now -- hi, Deb.

Good to see you.

What are you working on?

FEYERICK: Hey there, Suzanne.

Well, Vice President Joe Biden calling it a potentially devastating blow to Al Qaeda in Iraq. He's referring to yesterday's killing of the terror network's two most senior leaders in the region, Abu Ayyub Al-Masri and Abu Omar Al-Baghdadi, who were planning attacks on churches in Baghdad. The two men were killed during an Iraqi-led operation supported by U.S. forces. They were found hiding in a hole in a safe house. A U.S. soldier died during that assault.

Family members of the 17 sailors killed in the 2000 attack on the USS Cole are now taking on Sudan in a new lawsuit. Plaintiffs are seeking close to $300 million in damages for pain and suffering. A judge has already awarded $13 million in compensatory damages, finding Sudan liable for assisting the terrorists in the attack. Until now, federal law prevented the awarding of punitive damages.

And three people have been seriously injured after a chain reaction collision in Philadelphia involving a car and several horse drawn carriages. The car reportedly knocked one carriage onto the curb and the second carriage overturned near the city's historic district. No horses were injured in the crash. The cause of the accident still under investigation.

And, well, call it the case of library books that got checked out, but never returned. The culprit -- President George Washington, the first president of the United States. He checked those books out more than 200 years ago from the New York Society Library. He never brought them back. Since then, the books have been earning a few cents a day in fines. Today, that fine is more than $4,000, though, of course, if they're first editions, Suzanne, who cares about the fine?

Let's figure out how much the books cost and find the books. Wow!

MALVEAUX: I thought it would be a little bit more than that.

FEYERICK: OK.

MALVEAUX: Absolutely. Me, too. They should look at the last place he slept.

OK. Thanks, Deb. Well, Bill Clinton -- he knows a lot about being the target of anti- government anger. And he is worried about the protests and verbal attacks against the Obama administration. He talked to our Wolf Blitzer about his worst fears.

And why police in Arizona may get new power to crack down on illegal immigrants.

(COMMERCIAL BREAK)

MALVEAUX: You're in THE SITUATION ROOM.

Happening now, It was one of the worst terrorist attacks on U.S. soil. Now, on this 15th anniversary of the Oklahoma City bombing, what's the biggest threat Americans are facing?

I'm going one-on-one with Homeland Security Secretary Janet Napolitano.

And as Pope Benedict marks the sixth anniversary of becoming pope, does he have what it takes to moving the Catholic Church beyond a growing sex abuse scandal?

Wolf Blitzer is off today.

I'm Suzanne Malveaux.

And you're in THE SITUATION ROOM.

In Oklahoma City today, 168 seconds of silence -- one for every victim of the devastating bombing of a federal building exactly 15 years ago. It was the worst act of terror inside this country at the time, before 9/11. And it was all the more shocking because the bombers were Americans.

Army veteran Timothy McVeigh was executed. Terry Nichols is serving life without parole. And the nation still is trying to come to grips with the harsh reality that we are vulnerable to attacks from within.

Former President Bill Clinton and others fear that the kind of anti- government anger that led to the Oklahoma bombing is thriving today. Ahead,

I'll ask Homeland Security Secretary Janet Napolitano about that.

But right now, listen to Clinton's candid conversation with Wolf Blitzer about the political climate in this country.

(BEGIN VIDEOTAPE)

BLITZER: I guess the question is, is the rhetoric that we're hearing today -- I don't know if you want to get into the Tea Party or some of the expressions you're hearing there...

WILLIAM CLINTON, FORMER PRESIDENT OF THE UNITED STATES: Yes.

BLITZER: -- or what we're generally hearing from a small, but very, very vocal group.

Is that potentially dangerous?

CLINTON: Yes. Most of the Tea Party people, though, are -- are explicitly political. You've got to give them that. And forget about whether we disagree with them or not. It -- it's really important to be able to criticize your government and criticize elected officials. That never bothered me. Nobody's right all the time and it's part of the lifeblood of liberty. The freedom of speech means the freedom to criticize, in part.

And so most of them have been understanding that they are not like the Boston tea party when there was no law. There was no representation. They just have representation that they didn't vote for and don't agree with. But most of them have been well within the bounds. And they're harsh, but limited criticism. That is they're not advocating violence or encouraging other people to do it.

But some of the things that the secessionists had, the Idaho militia says if they want to secede in Idaho, they'll support them militarily. Some of the things the senators have said, some of the things these oath keepers have said, that's more like the extremists in the militia groups or what David Koresh did or some of the other people that all of which influenced Timothy McVeigh. I think it was important not to draw too tight of a historical analogy.

The only thing I want to say is I'm not interested in gagging anybody. I actually love this political debate. I'd like to be a part of it. I was a tiny part of it when the president asked Hillary and me to make some calls on the health care thing. And then for me to go out and speak to this Senate and others on it. But, I just think that we have to be careful. We've been down this road on more than one occasion for it. We don't want to go down it again.

WOLF BLITZER, CNN ANCHOR: The other difference, yes this internet has exploded over these 15 years. There's a Democratic president now, you were a Democratic president then. But the other big difference is there's an African American president.

CLINTON: Yes. And an African American president whose father was from Kenya who has been, you know, his mother's second husband was a Muslim. And so he's had all these attacks from the birthers and others. I do think -- and he's had a lot of threats, and also the members of Congress have had a lot of threats against them. We had a lot of threats. I remember when that guy came from Colorado and opened fire on the white house with an assault weapon and sprayed the press room. Remember that?

Some of the bullets got under pressure. They were so angry at me. And they were madder at me -- I was sort of -- and he's an outsider. That is the white southern protestant, which I was one, were the heart and soul of the then right wing movement in America. Of the right wing of the conservative party. Also the people who were most alienated. They figured what was the matter with me? I was a traitor to my class. President Obama is different and symbolizes the increasing diversity of America. And both of them -- and for him it's like a symbol -- he symbolizes the loss of control of predictability, of certainty, of clarity. That a lot of people need for their psychic well being. And so I worry about it. Look, he's well protected by the secret service, they're terrific. And a president, I can tell you, I've never pet a president. And look, George W. Bush had some threats against him. People who strongly disagree with his policy. Eric Cantor got a threat here.

The governor of New Jersey has been at least jokingly threatened by some of the interest groups in New Jersey, the Republican governor of New Jersey. But by and large, in the last 50 years -- at least since the early '70s when we had some left wing problems. By and large these have been systematically coming out of the far right. We just have to know where to draw the line. We should be sensitive to it. The 15th anniversary of Oklahoma City, I'm not trying to draw a total parallel. We should be aware of this.

This is a vast echo chamber, this internet. And there's lots of folks listening. And as I said, some are serious, some are delirious, some are connected, some are unhinged. And we all of us who have any responsibility have to exercise that responsibility so that we're intellectually honest about our political positions. But we're also intellectually honest what certain words might do to people who are less stable.

SUZANNE MALVEAUX, CNN ANCHOR: Well, there's fresh evidence that Americans are losing their faith and trust in government. What's driving the skepticism? And could it be devastating for the Obama administration?

Also, a vote that could change the way police nab illegal immigrants along the southern border.

And in the wake of its big recall scandal, Toyota agrees to pay a record fine for the federal government.

(COMMERCIAL BREAK)

MALVEAUX: Deborah Feyerick is monitoring some of the other top stories that are coming into THE SITUATION ROOM right now. Hey Deb. What are you working on?

DEBORAH FEYERICK, CNN CORRESPONDENT: Hi there Suzanne. Well, a sweeping immigration bill is set for a final vote in the Arizona state Senate. The house has already passed it. It would allow police to question people thought to be in the U.S. illegally. Arizona's the nation's busiest crossing point with some 460,000 undocumented immigrants. Backers say this would uncuff police. Opponents say it will encourage racial profiling. Another provision targets people who knowingly hire or transport day laborers who are illegal immigrants.

And the U.S. military's earthquake relief operation in Haiti is coming to a close. The U.S. commander there says all but about 500 National Guard and reserve troops will be gone by the first of June. At its peak, about 22,000 troops were involved in the relief and recovery efforts. The January 12th earthquake killed an estimated 250,000 people.

And President Obama is headed to Los Angeles this hour. He'll be taking part in high-priced fundraisers for the Democratic National Committee and Democratic Senator Barbara Boxer's reelection campaign. Tickets for one reception cost as much as $2500 each. Another event is priced at more than $17,000 a pop. The president will stay overnight in Los Angeles and return to Washington tomorrow.

If you like to shop at discount stores like Costco, your options might be getting just a bit limited by the U.S. Supreme Court. The justices agreed today to hear a legal site to stop Costco from selling Swiss watches for up to a third less than they cost elsewhere. The case could affect a wide array of discount stores and online sites that buy items overseas and then sell them without the manufacturer's permission. And that would take a lot of fun out of buying discount, Suzanne.

MALVEAUX: OK. Thank you so much, Deb.

Well, as the country marks the 15th anniversary of the Oklahoma City bombing, a new poll is revealing how much trust Americans have in their government. You might be surprised by what we find.

And would you be better off if it was your doctor serving in Congress rather than a career politician? You'll want to hear what some people are saying.

(COMMERCIAL BREAK)

MALVEAUX: On this 15th anniversary of the Oklahoma City bombing, how much trust do Americans have in their government? Joining me to talk about that and more in our strategy session, two CNN political contributors, Hillary Rosen of the Brunswick Group and Republican consultant Alex Castellanos. Thanks for joining us here. I want to start off by mentioning this poll. It's very interesting to see a lot of discussion about whether or not there's a strong antigovernment sentiment. The Pew Research Center says that - asks the question how often do you trust the government and Washington to do what's right? Well, most of the time 19 percent, some of the time, 65 percent, and never, 11 percent. Not a lot of faith in the government to do right. And the second one, are you angry with the federal government when it comes to Republicans, 30 percent. Democrats, 9 percent, independents, 25 percent. Why do you suppose there's such distrust, again, with the government and even some hostility? Alex?

ALEX CASTELLANOS, REPUBLICAN STRATEGIST: I think for a lot of reasons. We're moving from an old industrial age to big top down government could tell people what to do to the communications age. Now all of us have a lot of power over our own lives. Our lives are very complicated. And we don't think big old dumb slow government in Washington can run 40 percent of our lives of our economy. And that's a real concern for people. And also, right now the average American will work about 20 years of their lives to pay taxes, to pay for government. You know, that's -- if you commit murder, you only serve eight, but now you're working for the government for about 20 years or more of your life. Those kind of issues, the loss of power, being told what to do. I think by a big obtrusive government and the inability to solve our problems. Social security, nearly bankrupt, Medicare, bankrupt, post office, bankrupt.

MALVEAUX: I heard the words, big, old, slow, and dumb. I can't imagine you agree with any of those things.

HILARY ROSEN, BRUNSWICK GROUP: Well, I do agree there are trends that shift people's views about government. But I looked at the Pew results today in a graph form. And where it peaked was in the year 2000 in terms of faith in government. And since the year 2000, the chart just goes down and down and down. And what we've seen is President Obama's obviously inherited this since 2000 and is trying to pick it back up. But this is a big titanic turning around in a creek. And I think it's going to take time. But what we've seen is there's been some efforts at changing how government is responsive to people.

MALVEAUX: You know, one of the things when I covered President Obama then during the campaign, he ran on this notion. This idea that the government was -- that you can be a part of the solution, you could change the country. And that the government could change the country, as well if you were to go ahead and vote for him, you'd have a better life and you can make other people's lives better. Why do you suppose that people are not buying that yet? That they're not believing in that yet?

CASTELLANOS: Because of the campaign was very bottom up government. He said we're the change we've been waiting for. But since he got to Washington, bottom up Obama has been classic top down liberal orthodoxy. No, no, we're going to tell you what to think, solve all your problems, send us all your money. There's nothing really new about that. I think he's distanced himself as the bottom up candidate, become the top down president.

ROSEN: I think This is the squeaky, noisy wheels of change. And it takes a while. And we're going to see slow change, but as people see as a health care system that is responding to their need for more services as people see an energy system that's more into alternative fuels, education investment, this is going to change.

MALVEAUX: Real quick --

CASTELLANOS: The Catholic Church. It's the U.S. government. Big, slow, top down things don't work very well in a complex world.

MALVEAUX: Why do you suppose here, when we take a look at the Pew Research poll. Federal government is a major threat, Republicans, 43 percent say yes. Democrats, 18 percent, independents, 33 percent. We heard from former Bill Clinton who said part of the reason why you have this antigovernment sentiment in part is because you have an African American president. Do you believe that's true?

CASTELLANOS: No. Those same voters right there elected an African American president. And knew it. It wasn't a secret. But it wasn't a divisive agenda. He was a very different candidate than he's been a president. You know, he's really turned out to be more of George McGovern without the experience as president. He's grown government when he said we'd have pay as you go budgeting, that kind of thing. There's a reason people are angry. And that's because --

ROSEN: Actually --

MALVEAUX: You want to jump in here before we go?

ROSEN: Yes. The bottom line I thought President Clinton said that was more relevant to the problem is that the online space does allow a lot of camaraderie and discontent. So you can anticipate other people feeling angry if you are. In a way that you really couldn't before. But again, this is not something that came with president Obama. If anything, the shift is moving, I think the other way.

MALVEAUX: Okay. Got to leave it there. Hilary, Alex. Thank you so much.

Today marks five years since Pope Benedict XVI became pope. The Vatican is celebrating, but critics want the pontiff to say more and do more to respond to the sex abuse scandal engulfing the church.

And with volcanic ash still clouding the skies, is it safe for flights to resume in Europe? We're going to take a look at the short-term and long-term impacts of the crisis and when nature comes unleashed.

(COMMERCIAL BREAK)

MALVEAUX: It's in the middle of the United States, the geographic center. And while the state of Kansas has been hit hard by the economic recession, residents there are building up, and it's working. Our Tom Foreman has that story.

(BEGIN VIDEOTAPE)

TOM FOREMAN, CNN CORRESPONDENT: Out of the tourist attraction called "Old Cowtown," amid the cannon and guns, Kansans are reenacting some of the battles from the state's historic past. But their present struggle is for the future. Do you see a lot of people around here worrying about the economy right now?

UNIDENTIFIED FEMALE: Yes.

UNIDENTIFIED MALE: Yeah. My friends, some of them, don't know where the next check is coming from.

UNIDENTIFIED FEMALE: I'm in the automotive industry, and we've seen a big downturn and everybody is worried about it. Off to see the wizard

FOREMAN: Worried, but like that famous Kansan Dorothy in the wizard of oz, not sitting still. Smack in the middle of the country, Kansas has historically rolled out wheat, cattle, transportation and aviation products worth billions. The wonderful wizard of oz

NOAH WRIGHT, OZ WINERY: Yellow brick road. It's a blend of chardonnay. FOREMAN: So many have turned to past success for inspiration, and a competitive edge. That's what Noah Wright did.

WRIGHT: Kansas, before prohibition, was the third largest grape- producing state in the nation.

UNIDENTIFIED FEMALE: This is not too sweet, not too dry.

FOREMAN: Just three years ago, he had an idea to combine the state's little-known wine-making past with its fame as Dorothy's home. And oz winery has been booming ever since, despite the recession.

WRIGHT: Since we have opened, we have grown every year, and we don't know if we would be ten times more than that, or if we would just be the same level. You know, we just don't know if it's affecting us yet. We have no way to tell.

FOREMAN: Such efforts by thousands of small businesses have helped produce an unemployment rate well below the national average. A housing market on the rebound, and a population, if not entirely upbeat, at least hopeful. That classic American tune, "Home on the Range," was written in Kansas almost 140 years ago. And since that time, it's become a lot more than just a state song. For many people here, it is a measure of commitment. Their commitment to always build up whenever times turn down.

DINA BISNETTE, SMALL BUSINESS OWNER: The people here still have the same mentality. Whatever happens to us, we're going to manage. We're going to make due.

(END VIDEOTAPE)

MALVEAUX: That was CNN's Tom Foreman. His special series, "Building up America," continues from Kansas all this week. Also, Jack Cafferty is asking, what's behind the Republicans' opposition to financial reform? He is standing by with your e-mail.

And it was a shocking blow for al Qaeda in Iraq. The killing of two of the terror networks' top leaders. We'll have the details of how it all went down.

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MALVEAUX: Jack joins us again with the Cafferty file. Hey, Jack.

JACK CAFFERTY, CNN CORRESPONDENT: Suzanne, the question this hour is what's behind the Republicans' opposition to financial reform?

Kent writes in New Jersey, "The Republicans are opposed to the financial reform bill, because it's not reform. It doesn't change too big to fail. It doesn't separate commercial banks from investment banks. And it does nothing for the derivatives market. It will not end casino capitalism. It is just phony rhetoric."

Brian in Trinidad writes, "Because the Republicans know, same as the Democrats, that this is just about creating another government bureaucracy to reward party faithful with cushy, no-teeth jobs. The problem is not that our laws are inadequate, but that no one keeps an eye on things anymore."

Jane in Minnesota simplifies it, "Would you bite the hand that feeds you?"

Phil in Long Beach writes, "Both parties serve the same interests. Which side they take is all political theater, designed to distract the electorate. No matter what anyone says, there will be no meaningful financial reform just as there was no effective health care reform, no campaign finance reform, et cetera. It's just the Republicans' turn to play bad cop."

Bill in Pennsylvania. "Reform? You mean stop their raiding of the public treasury? There will be none of that. General Electric turned $10.3 billion before taxes. Paid no taxes. No, sir, there will be no reforms. All our legislators are bought minions of the corporations and the very rich. Two parties is just a myth to keep the voters entertained, but in the dark."

And Nikki writes, "The GOP says no, and I don't like this, more than my 4-year-old. Do the Republicans honestly think that even a Republican voter, just wants them to say no to every proposal the president announces? This is irrational. The GOP is losing credibility and looking more and more like a gang of robots, unable to think for themselves."

If you want to read more on the subject, you'll find it on my blog, CNN.com/CaffertyFile.

MALVEAUX: OK. Thank you, Jack.